Document:

Exhibit 4.1

Exhibit 4.1

SPECTRUM PHARMACEUTICALS, INC.

DEFERRED COMPENSATION PLAN

 

 

 

ARTICLE 1

PURPOSE

In recognition of the services provided by certain key employees, Spectrum Pharmaceuticals,
Inc. a Delaware corporation, has adopted the Spectrum Pharmaceuticals, Inc. Deferred Compensation
Plan as of September 2, 2011 to make additional retirement benefits and increased financial
security available on a tax-favored basis to those individuals. The Plan is intended to be a
nonqualified deferred compensation plan that complies with the provisions of Code Section 409A.
The Plan is intended to be an unfunded plan maintained primarily for the purpose of providing
deferred compensation benefits for a select group of management or highly compensated employees.

ARTICLE 2

DEFINITIONS

“Affiliate” means: (a) any firm, partnership, or corporation that directly or
indirectly through one or more intermediaries, controls, is controlled by, or is under common
control with the Company; (b) any other organization similarly related to the Company that is
designated as such by the Company; and (c) any other entity 50% or more of the economic interests
in which are owned, directly or indirectly, by the Company.

“Beneficiary” means the person or persons designated as such in accordance with
Section 7.3.

“Board” means the Board of Directors of Spectrum Pharmaceuticals, Inc.

“Change of Control” means a change in the ownership or effective control of the
Company, or in the ownership of a substantial portion of the assets of the Company, within the
meaning of Code Section 409A and the regulations and Internal Revenue Service guidance issued
thereunder. For purposes of this Section, a change in ownership of the Company occurs on the date
on which any one person or more than one person acting as a group acquires ownership of stock of
the Company that, together with stock held by such person or group constitutes more than 50% of the
total fair market value or total voting power of the stock of the Company. A change in the
effective control of the Company occurs on the date on which either (i) a person or more than one
person acting as a group acquires ownership of stock of the Company possessing 51% or more of the
total voting power of the stock of the Company or (ii) a majority of members of the Company’s board
of directors is replaced during any 12-month period by directors whose appointment or election is
not endorsed by a majority of the members of the Company’s board of directors prior to the date of
the appointment or election. A change in the ownership of a substantial portion of assets of the
Company occurs on the date on which any one person or more than one person acting as a group
acquires assets from the Company that have a total gross fair market value equal to or more than
51% of the total gross fair market value of all of the assets of the Company immediately prior to
such acquisition or acquisitions. With respect to a Participating Employer other than the Company,
a Change of Control shall occur on the date that the Company or its affiliates (or any combination
of the foregoing) shall cease to be the beneficial owners of at least 50% of the total fair market
value or total voting power of the outstanding voting securities of the Participating Employer or a
sale of substantially all of the
assets of a Participating Employer to a party other than the Company or one of its affiliates,
provided that in either case, the transaction will constitute a change in the ownership or
effective control or a change in the ownership of a substantial portion of the assets, as described
in Treasury Regulation Section 1.409A-3(i)(5).

 

 

 

“Class Year Distribution Account(s)” means, with respect to a Participant for each
Plan Year, the Class Year Distribution Account established on the books of account of the Company,
pursuant to Section 5.1, for that Participant.

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

“Committee” means the Spectrum Pharmaceuticals, Inc. Compensation Committee appointed
by the Board of Directors of the Company.

“Company” means Spectrum Pharmaceuticals, Inc. a Delaware corporation.

“Compensation” means, for any Eligible Employee, the cash remuneration for services
payable by the Participating Employer with respect to a Plan Year, but excluding (even if
includible in gross income) reimbursements or other expense allowances, fringe benefits, moving
expenses and welfare benefits, as determined by the Company from time to time and communicated to
Eligible Employees.

“Disability” means that a Participant (a) is unable to engage in any substantial
gainful activity by reason of any medically determinable physical or mental impairment which can be
expected to result in death or can be expected to last for a continuous period of not less than 12
months, or (b) is, by reason of any medically determinable physical or mental impairment which can
be expected to result in death or can be expected to last for a continuous period of not less than
12 months, receiving income replacement benefits for a period of not less than 3 months under an
accident and health plan covering employees of the Participant’s employer. The determination of
the existence of a Disability shall be made by the Plan Administrator in accordance with Section
409A(a)(2)(C) of the Code and the regulations and guidance promulgated thereunder.

“Disabled” means having a Disability. The determination of whether a Participant is
Disabled shall be made by the Plan Administrator, whose determination shall be conclusive.

“Discretionary Company Contribution” means a contribution credited to the
Participant’s Class Year Distribution Account by the Company pursuant to Section 4.4 of the
Plan.

“Earnings Crediting Options” means the deemed investment options selected by the
Participant from time to time pursuant to which deemed earnings or losses are credited or debited,
as the case may be, to the Participant’s Class Year Distribution Accounts.

“Elective Deferral Limit” means the limit stated in Code Section 402(g)(1)(B), as
adjusted in accordance with Code Section 402(g)(4).

“Eligible Employee” means an Employee who has been determined by the Company to be
eligible to participate in the Plan.

 

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“Employee” means any individual employed by the Participating Employer on a regular,
full-time basis (in accordance with the personnel policies and practices of the Participating
Employer), including citizens of the United States employed outside of their home country and
resident aliens employed in the United States; provided, however, that to qualify as an “Employee”
for purposes of the Plan, the individual must be a member of a “select group of management or
highly compensated employees” within the meaning of Sections 201, 301 and 401 of ERISA; provided
further, that the following individuals shall not be eligible to participate in the Plan: (a)
individuals who are not classified by the Participating Employer as its employees, even if they are
retroactively recharacterized as employees by a third party or the Participating Employer, (b)
individuals for whom the Participating Employer does not report wages on Form W-2 or who are not on
an employee payroll of the Participating Employer, and (c) individuals who have entered into an
agreement with the Participating Employer which excludes them from participation in employee
benefit plans of the Participating Employer (whether or not they are treated or classified as
employees for certain specified purposes that do not include eligibility in the Plan).

“Enrollment Agreement” means the authorization form which an Eligible Employee files
with the Plan Administrator or its designee to participate in the Plan, including, without
limitation, one that is completed and/or sent electronically in a manner specified by the Plan
Administrator.

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

“Key Employee” means a “specified employee” within the meaning of Code Section
409A(a)(2)(B)(i) and the regulations issued thereunder.

“Participant” means an Eligible Employee who has filed a completed and executed
Enrollment Agreement with the Plan Administrator or its designee and is participating in the Plan
in accordance with the provisions of Article 4. In the event of the death or incompetency
of a Participant, the term shall mean his or her personal representative or guardian. An
individual shall remain a Participant until that individual has received full distribution of any
vested amount credited to the Participant’s Class Year Distribution Account(s).

“Participating Employer” means the Company, as well as each Affiliate identified in
Appendix A as may from time to time participate in the Plan by or pursuant to authorization of the
Company.

“Performance-Based Compensation” means Compensation based on services performed over a
period of not less than twelve months and which meets the following requirements: (a) the payment
of the Compensation or the amount of the Compensation is contingent upon the satisfaction of
pre-established organizational or individual performance criteria and (b) the performance criteria
are not substantially certain to be met at the time a Enrollment Agreement is submitted to the Plan
Administrator. For purposes hereof, “pre-established organizational or individual performance
criteria” shall mean criteria which are established in writing by not later than ninety (90) days
after the commencement of the period of service to which the criteria relates, provided that the
outcome is substantially uncertain at the time the criteria are established. Performance criteria
may be subjective but must relate to the performance of the
Participant, a group of Employees that includes the Participant or a business unit (which may
include the Company) for which the Participant provides services. The determination that any
subjective performance criteria have been met shall not be made by the Participant or by a family
member of the Participant. Performance-Based Compensation does not include any amount or portion
of any amount that will be paid regardless of performance or which is based on a level of
performance that is substantially certain to be met at the time the criteria is established.

 

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“Plan” means the Spectrum Pharmaceuticals, Inc. Deferred Compensation Plan, as amended
from time to time.

“Plan Administrator” means the Committee or any person(s) or entity appointed by the
Committee to perform the duties of Plan Administrator hereunder.

“Plan Year” means the 12-month period beginning on each January 1 and ending on the
following December 31. Initial Plan Year, August 15, 2011 to December 31, 2011.

“Retirement” means a Participant’s separation from Service with the Participating
Employer after attaining age 55 and completing at least 5 years of Service.

“Retirement Savings Plan” means the Company’s Retirement Savings Plan, or any other
defined contribution plan designated by the Company which is maintained by the Participating
Employer and intended to be qualified under Code Section 401(a).

“Separation from Service” means the termination of a Participant’s employment or
Service with a Participating Employer for any reason which constitutes a “separation from service”
within the meaning of Section 409A of the Code and the regulations promulgated thereunder,
including Treasury Regulation Section 1.409A-1(h).

“Service” means the period of time during which an employment relationship exists
between an Employee and the Participating Employer, including any period during which the Employee
is on an approved Leave of Absence, whether paid or unpaid. “Service” shall not be deemed to have
ceased if an Employee transfers directly between the Participating Employer and an Affiliate.

“Subsequent Election” means an election made by a Participant in accordance with
Section 4.1(d).

“Unforeseeable Emergency” means a severe financial hardship to the Participant
resulting from an illness or accident of the Participant, the Participant’s spouse, or a dependent
(as defined in Code Section 152(a)) of the Participant, loss of the Participant’s property due to
casualty, or other similar extraordinary and unforeseeable circumstances arising as a result of
events beyond the control of the Participant.

“Valuation Date” shall mean each business day except as specified below.

(a) The Valuation Date for benefits upon Retirement and for benefits upon Separation from
Service shall be the last day of the month in which the Participant’s Separation from Service
occurs. In the case of a benefits upon Retirement or Separation from
Service payable to a Key Employee, the Valuation Date shall be the last day of the month
following the date which is six months following such Participant’s Separation from Service.

 

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(b) The Valuation Date for an in Service distribution shall be the last day of the month in
which the in Service distribution date occurs.

(c) The Valuation Date for benefits upon Disability shall be the last business day of the
month in which the Plan Administrator determines that the Participant is Disabled.

(d) The Valuation Date for benefits upon death is the last day of the month in which the
Participant’s death occurs.

ARTICLE 3

ADMINISTRATION OF THE PLAN AND DISCRETION

3.1. The Committee, as Plan Administrator, shall have full power and authority to interpret
the Plan, to prescribe, amend and rescind any rules, forms and procedures as it deems necessary or
appropriate for the proper administration of the Plan and to make any other determinations and to
take any other such actions as it deems necessary or advisable in carrying out its duties under the
Plan; including, without limitation, the investment direction of Plan assets. All action taken by
the Plan Administrator arising out of, or in connection with, the administration of the Plan or any
rules adopted thereunder, shall, in each case, lie within its sole discretion, and shall be final,
conclusive and binding upon the Company, the Board, all Participating Employers, all Employees, all
Participants, all Beneficiaries and all persons and entities having an interest therein. The
Committee, may, however, delegate to any person or entity any of its powers or duties under the
Plan. To the extent of any such delegation, the delegate shall become the Plan Administrator
responsible for administration of the Plan, and references to the Plan Administrator shall apply
instead to the delegate. Any action by the Committee assigning any of its responsibilities to
specific persons who are directors, officers, or employees of the Company shall not constitute
delegation of the Committee’s responsibility but rather shall be treated as the manner in which the
Committee has determined internally to discharge such responsibility.

3.2. The Plan Administrator shall serve without compensation for its services unless otherwise
determined by the Board. All expenses of administering the Plan shall be paid by the Company.

3.3. The Company shall indemnify and hold harmless the Plan Administrator and the members
thereof from any and all claims, losses, damages, expenses (including counsel fees) and liability
(including any amounts paid in settlement of any claim or any other matter with the consent of the
Board) arising from any act or omission of such member, except when the same is due to gross
negligence or willful misconduct.

3.4. Any decisions, actions or interpretations to be made under the Plan by the Company, the
Board, any Participating Employer or the Plan Administrator shall be made in its respective sole
discretion, not as a fiduciary, and need not be uniformly applied to similarly
situated individuals and shall be final, binding and conclusive on all persons interested in
the Plan.

 

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3.5. Upon a Change of Control, the Committee, as constituted immediately prior to such Change
of Control, shall continue to act as the Committee. However, the individual who was the Chief
Executive Officer of the Company (or if such person is unable or unwilling to act, the next highest
ranking officer) prior to the Change of Control shall have the authority (but shall not be
obligated) to appoint an independent third party to act as the Committee.

Upon such Change of Control, the Company may not remove the Committee or, if different, the
Plan Administrator in existence prior to such Change of Control, unless 2/3rds of the members of
the Board of Directors of the Company and a majority of Participants and Beneficiaries with account
balances consent to such removal and replacement. With respect to directing the investment of Plan
assets, the trustee of any rabbi trust shall follow the instructions in place prior to such Change
of Control, as amended at any time from the Committee that was in existence prior to such Change of
Control or from the duly authorized Plan Administrator appointed prior to such Change of Control or
from any duly appointed independent third party appointed under this Section.

The Participating Employer shall, with respect to the Committee identified under this Section:
(i) pay all reasonable expenses and fees of the Committee; (ii) indemnify the Committee (including
individuals serving as Committee or Plan Administrator) against any costs, expenses and liabilities
including, without limitation, reasonable attorneys’ fees and expenses arising in connection with
the performance of the Committee hereunder, except with respect to matters resulting from the
Committee’s gross negligence or willful misconduct; and (iii) supply full and timely information to
the Committee on all matters related to the Plan, any rabbi trust, Participants, Beneficiaries and
accounts as the Committee may reasonably require.

ARTICLE 4

PARTICIPATION

4.1. Election to Participate.

(a) Eligibility and Timing of Election to Participate. Any Eligible Employee may
enroll in the Plan effective as of the first day of a Plan Year by filing a completed and fully
executed Enrollment Agreement with the Plan Administrator by a date set by the Plan Administrator.

(i) Filing of Enrollment Agreement. Subject to clause (iii) below, an executed
Enrollment Agreement must be filed by December 31 of the Plan Year preceding the Plan Year in which
such Compensation is to be earned, or such other time as may be established by the Plan
Administrator; provided, however, that all deferral elections under the Plan must be made at a time
that is permitted under applicable law, including, without limitation, Code Section 409A.

(ii) Revocation of Election. Except as otherwise provided in Section 6.7(a),
deferral elections for a Plan Year are irrevocable.

 

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(iii) “Evergreen” Enrollment Agreement. The Plan Administrator, in its discretion,
may provide in the Enrollment Agreement that such Enrollment Agreement will continue in effect for
each subsequent year or performance period. Such “evergreen” Enrollment Agreements will become
effective with respect to an item of Compensation on the date such election becomes irrevocable
under this Section 4.1. An evergreen Enrollment Agreement may be terminated or modified
prospectively with respect to Compensation for which such election remains revocable under this
Section 4.1.

(b) Amount of Deferral. Pursuant to the Enrollment Agreement, the Eligible Employee
shall irrevocably elect the percentage or dollar amount by which (as a result of payroll deduction)
the Participant’s Compensation will be deferred for the Plan Year. Each Participant’s Enrollment
Agreement shall designate separately the percentage of Compensation to be taken from the
Participant’s base salary for the Plan Year; the percentage or dollar amount to be taken from the
Participant’s short term incentive compensation, long term incentive compensation and any other
incentive compensation approved by the Company for the Plan Year; and whether to defer any refund
to the Participant of 401(k) contributions made to the Retirement Savings Plan. Subject to the
following sentence, the amount that may be deferred is any whole percentage or dollar amount of the
Participant’s Compensation; provided, however, that deferrals will be made after required payroll
tax deductions and any deductions elected by the Participant (including, but not limited to,
deductions for payment for medical and other benefit coverages). The Plan Administrator may
establish maximum and/or minimum amounts and/or percentages that may be deferred under this
Section 4.1 and may change such standards from time to time. Any such maximum or minimum
shall be communicated by the Plan Administrator to the Participants prior to the date by which
Participants must submit an Enrollment Agreement with respect to the Plan Year or type of
Compensation to which the maximum or minimum applies.

(c) Timing and Form of Payment of Distribution from Accounts. At the time that a
Participant makes a deferral election with respect to a Plan Year, the Participant shall designate
the time and form in which such deferral and any Discretionary Company Contribution made for such
Plan Year (and notional earnings thereon) shall be distributed; provided, however, that all
Enrollment Agreements filed by an Eligible Employee must provide for distribution to be made at a
time and in a form that is consistent with the distribution options made available under the Plan
and permitted under applicable law, including, without limitation, Code Section 409A. In
accordance with the foregoing, a Participant may only designate one or more of the following events
as the time for which a distribution will be made:

(i) Pursuant to a fixed schedule in accordance with Treasury Regulation Section
1.409A-3(i)(1);

(ii) Upon a Separation from Service;

(iii) Upon a Change of Control;

(iv) Upon a Disability; or

(v) Upon death;

 

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An election with respect to the time and form of benefit distributions may not be changed, except
as expressly provided for herein. In the event the Participant fails to make a valid election of
the form of payment, the distribution will be made in a lump sum upon the first to occur of (ii)
through (v) above.

(d) Subsequent Elections. Each Participant who has made an election to defer
Compensation may make a Subsequent Election to further defer the time of payment and/or change the
form of payment for one or more of such Participant’s Class Year Distribution Accounts. No such
Subsequent Election shall be valid unless it is made 12 months prior to the previously scheduled
payment date applicable to such distribution account and the payment commencement date is deferred
for not less than five (5) years from the previously scheduled payment date. In the event of the
Participant’s separation from Service with the Company prior to the expiration of 12 months from
the date the Subsequent Election is made, the Subsequent Election shall be of no effect. For
purposes of this subsection, a series of installment payments shall be considered a single payment.

(e) Performance Based Compensation. An Enrollment Agreement containing an election to
defer Performance-Based Compensation must be submitted to the Plan Administrator no later than six
(6) months prior to the end of the period in which the services are performed and in accordance
with the Section 409A of the Code and Treasury Regulation Section 1.409A-2(a)(8). An Enrollment
Agreement submitted pursuant to this Section 4.2(e) shall become irrevocable as of the day
immediately following the latest date for filing such election.

(f) Vesting. All Compensation deferred by Participants under this Section
4.1, and any deemed earnings thereon, shall be fully and immediately vested and nonforfeitable.

4.2. Leave of Absence.

(a) Paid Leave of Absence. If a Participant is authorized by his or her Participating
Employer for any reason to take a paid leave of absence from the employment or service of the
Participating Employer, and such leave of absence does not constitute a Separation from Service,
the Participant shall continue to be considered actively employed by or in the service of the
Participating Employer for purposes hereof and the Enrollment Agreement continue to apply to any
Compensation paid during such leave of absence.

(b) Unpaid Leave of Absence. If a Participant is authorized by the his or her
Participating Employer for any reason to take an unpaid leave of absence from the employment of or
service with the Participating Employer, the Participant shall continue to be considered actively
employed by the Participating Employer for purposes hereof. Upon the earlier of the date the leave
of absence expires or the date the Participant returns to paid employment or service, deferrals
shall resume for the remaining portion of the Plan Year in which the expiration or return occurs,
based on the Enrollment Agreement, if any, in effect for that Plan Year. If no deferral election
was made for that Plan Year, no Plan deferrals shall be withheld from Compensation for the
remainder of the Plan Year.

 

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4.3. Filing of Elections by New Eligible Employees. The Plan Administrator may, in
its discretion, permit an Employee who first becomes an Eligible Employee after the beginning of a
Plan Year to enroll in the Plan for that Plan Year by filing a completed and fully executed
Enrollment Agreement, in accordance with Section 4.1, as soon as practicable following the
date the Employee becomes an Eligible Employee but, in any event, not later than 30 days after such
date. Notwithstanding the foregoing, however, any election by an Eligible Employee to defer
Compensation pursuant to this Section 4.3 shall apply only to such amounts as are earned by
the Eligible Employee after the date on which such Enrollment Agreement is filed.

4.4. Discretionary Company Contributions. The Company may credit a discretionary
Company contribution under the Plan for a Plan Year (each, a “Discretionary Company
Contribution”). Such Discretionary Company Contribution, if any, and the amount thereof, will
be credited in the sole and absolute discretion of the Company, and to such Participants or
group(s) or category(ies) of Participants as shall be determined in the sole and absolute
discretion of the Company. Discretionary Company Contributions under this Section 4.4, if
any, and any deemed earnings thereon, shall become vested and nonforfeitable in accordance with
Section 6.2.

ARTICLE 5

ALLOCATION TO ACCOUNTS

5.1. Accounts. For each Participant, the Plan Administrator shall establish and
maintain a Class Year Distribution Account for each Plan Year. The amount of Compensation deferred
for a Plan Year pursuant to Section 4.1 shall be credited by the Company to the
Participant’s Class Year Distribution Account, in accordance with the Participant’s Enrollment
Agreement, as soon as reasonably practicable following the close of the payroll period or incentive
compensation payment date for which the deferred Compensation would otherwise be payable, as
determined by the Plan Administrator in its sole discretion. Any amount once taken into account as
Compensation for purposes of the Plan shall not be taken into account thereafter. Discretionary
Company Contributions, if applicable, pursuant to Section 4.4 for a Plan Year shall be
credited by the Company to each eligible Participant’s Class Year Distribution Account, in
accordance with such Participant’s Enrollment Agreement, at such time(s) as determined by the Plan
Administrator in its sole discretion. The Participant’s Class Year Distribution Account(s) shall
be reduced by the amount of payments made by the Company to the Participant or the Participant’s
Beneficiary pursuant to the Plan.

5.2. Earnings on Accounts.

(a) General. A Participant’s Class Year Distribution Account(s) shall be credited
with earnings in accordance with the Earnings Crediting Options elected by the Participant from
time to time. Participants may allocate their Class Year Distribution Accounts among the Earnings
Crediting Options available under the Plan only in whole percentages of not less than 1%.

 

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(b) Investment Options. The deemed rate of return, positive or negative, credited or
debited, as the case may be, under each Earnings Crediting Option is based upon the actual
investment performance of the investment fund(s) as the Plan Administrator may
designate from time to time, and shall equal the total return of such investment fund net of
asset based charges, including, without limitation and as the Plan Administrator determines from
time to time, money management fees, and fund expenses. The amount of such deemed investment rate
of return shall be determined by the Plan Administrator and such determination shall be final and
conclusive upon all concerned. The Plan Administrator reserves the right, on a prospective basis,
to add or delete Earnings Crediting Options. If a Participant does not make an election of an
Earnings Crediting Option, the Participant’s Class Year Distribution Account will be allocated to
such Earnings Crediting Option(s) as determined by the Plan Administrator in its sole discretion,
and the Plan Administrator shall be absolved of any liability or responsibility for such action.

5.3. Earnings Crediting Options. Notwithstanding that the rates of return credited or
debited to Participants’ Class Year Distribution Accounts under the Earnings Crediting Options are
based upon the actual performance of the investment options specified in Section 5.2, or
such other investment funds as the Plan Administrator may designate, the Company shall not be
obligated to invest any Compensation deferred by Participants under this Plan, or any other
amounts, in such portfolios or in any other investment funds.

5.4. Changes in Earnings Crediting Options. A Participant may change the Earnings
Crediting Options to which the Participant’s Class Year Distribution Accounts are deemed to be
allocated, subject to such rules and limitations as may be determined by the Plan Administrator.
Each such change may include (a) reallocation of the Participant’s existing Class Year Distribution
Account(s) in whole percentages of not less than 1%, and/or (b) change in investment allocation of
amounts to be credited to the Participant’s Class Year Distribution Account(s) in the future, as
the Participant may elect. The effect of a Participant’s change in Earnings Crediting Options
shall be reflected in the Participant’s Class Year Distribution Account(s) at such time following
the Plan Administrator’s receipt of notice of such change as shall be determined by the Plan
Administrator in its sole discretion.

5.5. Valuation of Accounts. The value of a Participant’s Class Year Distribution
Account(s) as of any Valuation Date shall equal the amounts theretofore credited or debited to such
Distribution Account(s), including any earnings (positive or negative) deemed to be earned on such
Distribution Account(s) in accordance with Section 5.2 through the day preceding such date,
less the amounts theretofore deducted from such Distribution Account(s).

5.6. Statement of Accounts. The Plan Administrator shall provide to each Participant,
not less frequently than annually, a statement in such form as the Plan Administrator deems
appropriate setting forth the balance standing to the credit of each Participant in each of his or
her Class Year Distribution Accounts.

5.7. Distributions from Accounts.

(a) For purposes of any provision of the Plan relating to distribution of benefits to
Participants or Beneficiaries, the value of a Participant’s Class Year Distribution Account(s)
shall be determined as of any Valuation Date as soon as reasonably practicable preceding the
distribution date, as determined by the Plan Administrator in its sole discretion. In the case of
any benefit payable in the form of a single lump-sum payment, the value of a
Participant’s Class Year Distribution Account(s), as determined pursuant to this Article
5, shall be distributed. In the case of any benefit payable in the form of annual
installments, as of any payment date, the amount of each installment payment shall be determined as
the quotient of (x) the value of the Participant’s Class Year Distribution Account subject to
distribution, as determined pursuant to this Article 5, divided by (y) the number of
remaining annual installments immediately preceding the payment date.

 

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(b) In the case of any benefit payable in the form of annual installments, the initial
installment will be paid within 90 days after the event giving rise to the distribution
(Retirement, Separation from Service, Disability or death, as applicable), and subsequent
installments will be valued each December 31st and paid as soon as administratively
feasible thereafter.

(c) Any distribution made to or on behalf of a Participant from such Participant’s Class Year
Distribution Account in an amount which is less than the entire balance of any such Distribution
Account shall be made pro rata from each of the Earnings Crediting Options to which such
Distribution Account is then allocated.

(d) Any and all distributions from the Plan shall be made in cash.

ARTICLE 6

BENEFITS TO PARTICIPANTS

6.1. Benefits From the Class Year Distribution Account(s). Benefits from a
Participant’s Class Year Distribution Account shall be paid to the Participant as follows:

(a) In-Service Distributions. In the case of a Participant who continues in Service,
the portion of the Participant’s Class Year Distribution Account consisting solely of the
Participant’s deferrals under Section 4.1 and earnings thereon under Section 5.2
shall be paid or commence to be paid to the Participant by the payment date elected by the
Participant in the Enrollment Agreement pursuant to which such Class Year Distribution Account was
established (which payment date may be no earlier than the first month of the third Plan Year after
the Plan Year for which such Class Year Distribution Account was established, e.g., January 2014
for the 2011 Class Year Distribution Account), in a lump sum or in up to five (5) annual
installments, as elected by the Participant in the Enrollment Agreement or in a Subsequent
Election.

(b) Continuation of Service Condition. In the case of a Participant whose Service
with the Company ceases, the Participant’s elections in an Enrollment Agreement or in a Subsequent
Election with respect to the time and form of distribution of such Participant’s Class Year
Distribution Account(s) applicable when a Participant is in Service shall be void and of no effect,
and distribution of such Distribution Account(s) shall be governed by the Participant’s elections
in an Enrollment Agreement or in a Subsequent Election applicable to distribution upon Retirement,
Separation from Service, Disability or death, as applicable.

 

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6.2. Vesting.

(a) Discretionary Company Contributions described in Section 4.4, above, and the earnings
thereon, shall vest in accordance with the vesting schedule(s) established by the Plan
Administrator at the time that the Discretionary Company Contribution is made. The foregoing
provisions concerning vesting of Discretionary Company Contributions notwithstanding, and subject
to the requirements of Treasury regulations promulgated under Section 409A of the Code, all
Discretionary Company Contributions shall become 100% vested upon the occurrence of the earliest
of: (i) Retirement; (ii) death of the Participant; (iii) Disability of the Participant; and (iv)
Change of Control of the Company (or with respect to a Participant who is employed by a
Participating Employer, a Change of Control of such Participating Employer). The Company may, at
any time, in its sole discretion, accelerate the vesting of a Participant’s interest in
Discretionary Company Contributions.

(b) Notwithstanding anything contained in this Plan to the contrary, in the event that any
payment or benefit to a Participant or for a participant’s benefit paid or payable or distributed
or distributable pursuant to the terms of this Plan or otherwise in connection with, or arising out
of, a Change of Control, or any other event which constitutes a “Change in Control” within the
meaning of Section 280G of the Code (a “Payment” or “Payments”), would be subject
to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then the benefits
payable under this Plan shall be reduced (but not below zero), but only to the extent necessary so
that no portion of the Payments shall be subject to the excise tax imposed by Section 4999 of the
Code (the “Section 4999 Limit”). Unless otherwise determined by the Plan Administrator in
its discretion, the Company shall reduce or eliminate the benefits payable under this Plan by first
reducing or eliminating those benefits beginning with benefits which are to be paid the farthest in
time from the Determination (as defined below).

(i) All determinations required to be made under this Section 6.2 (each, a
“Determination”) shall be made by the Plan Administrator. The calculations shall be
provided to the Participant upon request (provided that the Plan Administrator or the Participant
believe in good faith that the any of the Payments may be subject to the Excise Tax); provided,
however, that if the Plan Administrator determines that no Excise tax is payable by the Participant
with respect to a Payment or Payments, Participant may request that a nationally recognized
accounting firm designated by the Company and reasonable acceptable to the Participant (the
“Accounting Firm”) furnish the Participant with an opinion reasonably acceptable to the
Participant that no Excise Tax will be imposed with respect to any such Payment or Payments.
Within ten (10) calendar days of delivery of the Determination to the Participant, the Participant
shall have the right to dispute the Determination (the “Dispute”). The existence of any
Dispute shall not in any way affect the Participant’s right to receive the benefits under this Plan
in accordance with the Determination. If there is no Dispute, the Determination by the Accounting
Firm shall be final, binding, and conclusive upon the Company, the Plan Administrator and the
Participant, subject to the application of Section 6.2(a)(ii).

 

12

 

(ii) As a result of the uncertainty in the application of Sections 4999 and 280G of the Code,
it is possible that the Payments either will have been made or will not have been made by the
Company, in either case in a manner inconsistent with the limitations provided in this Section
6.2(a) (an “Excess Payment” or “Underpayment,” respectively). If it is
established pursuant to (i) a final determination of a court for which all appeals have been
taken and finally resolved or the time for all appeals has expired, or (ii) an Internal Revenue
Service (the “IRS”) proceeding which has been finally and conclusively resolved, that an
Excess Payment has been made, such Excess Payment shall be deemed for all purposes to be a loan to
the Participant made on the date the Participant received the Excess Payment and the Participant
shall repay the Excess payment to the Company on demand, together with interest on the Excess
Payment to the Company on demand at one hundred twenty percent (120%) of the applicable federal
rate (as defined in Section 1274(d) of the Code) compounded semi-annually from the date of the
Participant’s receipt of such Excess Payment until the date of such repayment. If it is determined
(i) by the Accounting Firm, the Company (which shall include the position taken by the Company,
together with its consolidated group, on its federal income tax return) or the IRS, (ii) pursuant
to a determination by a court, or (iii) upon the resolution to the Participant’s satisfaction of
the Dispute, that an Underpayment has occurred, the Company shall pay an amount equal to the
Underpayment to the Participant within ten (10) calendar days of such determination or resolution,
together with interest on such amount at one hundred twenty percent (120%) of the applicable
federal rate compounded semi-annually from the date such amount should have been paid to the
Participant pursuant to the terms of this Plan or otherwise, but for the operation of this Section
6.2(b), until the date of Payment.

6.3. Benefits Upon Retirement. Upon Retirement, each Class Year Distribution Account
of the Participant shall be distributed in one of the following methods, as elected by the
Participant in the Enrollment Agreement pursuant to which such Class Year Distribution Account was
established or in a Subsequent Election: (a) in a lump sum; or (b) in up to twenty (20) annual
installments; provided, however, that the Distribution Account(s) of Participants who are Key
Employees shall not be distributed prior to the expiration of six (6) months from the date of such
Retirement, as determined by the Plan Administrator in its sole discretion. Prior to distribution,
such Participant’s Distribution Account(s) shall continue to be credited with earnings and/or
losses in accordance with Section 5.2 until fully distributed.

6.4. Benefits Upon Separation from Service. In the case of a Participant whose
Service with the Company ceases prior to Retirement, the vested portion of all of the Participant’s
Class Year Distribution Accounts shall be distributed in a lump sum; provided, however, that the
Distribution Account(s) of Participants who are Key Employees shall not be distributed prior to the
expiration of six (6) months from the date of such separation from Service, as determined by the
Plan Administrator in its sole discretion. Prior to distribution, such Participant’s Distribution
Account(s) shall continue to be credited with earnings and/or losses in accordance with Section
5.2 until fully distributed.

6.5. Benefits Upon Death. In the event of a Participant’s death before the complete
distribution of his or her Class Year Distribution Accounts, such Participant’s Beneficiary, named
on the most recently filed Designation of Beneficiary form, shall be paid a lump sum. Prior to
distribution, such Participant’s Distribution Account(s) shall continue to be credited with
earnings and/or losses in accordance with Section 5.2 until fully distributed. If the
Company owns a corporate-owned life insurance policy on the life of the Participant and the
Participant was in Service prior to death, the Beneficiary will receive an additional taxable
survivor benefit equal to $500,000.

 

13

 

6.6. Benefits Upon Disability. In the case of a Participant who becomes Disabled,
all of the Participant’s Class Year Distribution Accounts shall be distributed in a lump sum.
Prior to distribution, such Participant’s Distribution Account(s) shall continue to be credited
with earnings and/or losses in accordance with Section 5.2 until fully distributed.

6.7. Acceleration of Payment.

(a) Unforeseeable Emergency. In the event that the Plan Administrator, upon written
request of a Participant, determines, in its sole discretion, that the Participant has suffered an
Unforeseeable Emergency, the Company shall pay to the Participant from his or her Class Year
Distribution Account(s), as soon as practicable following such determination, an amount necessary
to meet such Unforeseeable Emergency, in a manner consistent with Code Section 409A and the
regulations issued thereunder, after deduction of any and all taxes as may be required pursuant to
Section 7.9 (the “Emergency Benefit”). Emergency Benefits shall be paid first from
the portion of the Participant’s Class Year Distribution Accounts consisting solely of the
Participant’s deferrals under Section 4.1 and earnings thereon, to the extent such portion
of one or more of such Class Year Distribution Accounts is sufficient to meet the emergency, in the
order in which such Accounts would otherwise be distributed to the Participant. If the
distribution exhausts the portion of the Class Year Distribution Accounts consisting solely of the
Participant’s deferrals under Section 4.1 and earnings thereon, the remainder of the
Participant’s Class Year Distribution Accounts may be accessed (to the extent vested). With
respect to that portion of any Class Year Distribution Account which is distributed to a
Participant as an Emergency Benefit in accordance with this Section 6.7(a), no further
benefit shall be payable to the Participant under this Plan. To the extent required by the
regulations under Code Section 409A, upon receipt of Emergency Benefits, the Participant’s deferral
election under Section 4.1 shall be cancelled for the rest of the Plan Year in which the
Emergency Benefits are paid.

(b) Change of Control.

(i) To the extent permitted by the regulations under Code Section 409A, within the 30 days
preceding or the twelve (12) months following a Change of Control, the Company may exercise its
discretion to terminate this Plan and, notwithstanding any other provision of the Plan or the terms
of any Enrollment Agreement or Subsequent Election, distribute to or with respect to each
Participant all of his or her Class Year Distribution Accounts.

(ii) A Participant will receive all his or her Class Year Distribution Accounts in a single
lump sum payment equal to the unpaid balance of all of his or her Accounts within ninety (90) days
from his or her Separation from Service if such Separation from Service occurs within twenty-four
(24) months following a Change of Control.

(iii) A Participant who is receiving installment payments at the time of a Change of Control
will receive the unpaid balance of his or her Accounts in a single lump sum within ninety (90) days
after such Change of Control regardless of any election otherwise made in his or her Enrollment
Agreement or Subsequent Election.

 

14

 

(c) Other Acceleration Event. To the extent permitted by Code Section 409A and the
regulations issued thereunder, notwithstanding the terms of an Enrollment Agreement or Subsequent
Election, distribution of all or part of a Participant’s Class Year Distribution Account(s) may be
made at any time the Plan fails to meet the requirements of Code Section 409A and the regulations
thereunder, with such payment not to exceed the amount required to be included in the Participant’s
income as a result of the failure.

6.8. Limited Benefit Cash-Out. If a Participant becomes eligible for a distribution
in accordance with the provisions of this Article 6, the Plan Administrator shall,
notwithstanding any election of the time and form of payment by the Participant, distribute to the
Participant the Participant’s Class Year Distribution Account(s) in a lump sum, if the total value
of the Participant’s Class Year Distribution Account(s) on the date that payment is to commence
does not exceed the maximum amount permitted to be automatically distributed under the regulations
promulgated under Code Section 409A, with such payment made on or before the later of (a) December
31 of the calendar year in which the Participant’s Retirement, separation from Service, Disability
or death occurs, or (b) the fifteenth day of the third month following the Participant’s
Retirement, Separation from Service, Disability or death.

6.9. Deduction Limitation on Benefit Payments. Notwithstanding the foregoing, if a
Participating Employer reasonably anticipates that the Participating Employer’s deduction with
respect to any distribution from the Plan would be limited or eliminated by application of Code
Section 162(m), then to the extent permitted by Treasury Regulation Section 1.409A-2(b)(7)(i),
payment shall be delayed as deemed necessary to ensure that the entire amount of any distribution
from this Plan is deductible. Any amounts for which distribution is delayed pursuant to this
Section shall continue to be credited with earnings and/or losses in accordance with Section
5.2 until fully distributed. The delayed amounts (and any amounts credited thereon) shall be
distributed to the Participant (or his or her Beneficiary in the event of the Participant’s death)
at the earliest date the Participating Employer reasonably anticipates that the deduction of the
payment of the amount will not be limited or eliminated by application of Code Section 162(m). In
the event that such date is determined to be after a Participant’s Separation from Service and the
Participant to whom the payment relates is determined to be a Key Employee, then to the extent
deemed necessary to comply with Treasury Regulation Section 1.409A-3(i)(2), the delayed payment
shall not be made before the end of the six-month period following such Participant’s Separation
from Service.

ARTICLE 7

MISCELLANEOUS

7.1. Amendment and Termination. The Plan may be amended, suspended, discontinued or
terminated at any time by the Company; provided, however, that no such amendment, suspension,
discontinuance or termination shall reduce or in any manner adversely affect the rights of any
Participant with respect to benefits that are payable or may become payable under the Plan based
upon the vested balance of the Participant’s Class Year Distribution Account(s) as of the effective
date of such amendment, suspension, discontinuance or termination. Notwithstanding the preceding
provisions of this Section 7.1, the Company reserves the right to amend the Plan, either
retroactively or prospectively, in whatever manner is required to achieve compliance with the
requirements of Code Section 409A.

 

15

 

7.2. Claims Procedure. It is intended that the claims procedures of this Plan be
administered in accordance with the claims procedure regulations of the Department of Labor set
forth in 29 CFR §2560.503-1.

(a) Claim. A person who believes that he is being denied a benefit to which he is
entitled under the Plan (hereinafter referred to as a “Claimant”) may file a written
request for such benefit with the Plan Administrator, setting forth the claim.

(b) Claim Decision. Upon receipt of a claim, the Plan Administrator shall advise the
Claimant within ninety (90) days of receipt of the claim whether the claim is denied. If special
circumstances require more than ninety (90) days for processing, the Claimant will be notified in
writing within ninety (90) days of filing the claim that the Plan Administrator requires up to an
additional ninety (90) days to reply. The notice will explain what special circumstances make an
extension necessary and indicate the date a final decision is expected to be made.

If the claim is denied in whole or in part, the Claimant shall be provided a written opinion,
using language calculated to be understood by the Claimant, setting forth:

(i) The specific reason or reasons for such denial;

(ii) The specific reference to pertinent provisions of this Plan on which such denial is
based;

(iii) A description of any additional material or information necessary for the Claimant to
perfect his or her claim and an explanation why such material or such information is necessary;

(iv) Appropriate information as to the steps to be taken if the Claimant wishes to submit the
claim for review;

(v) The time limits for requesting a review under subsection (c) and for review under
subsection (d) hereof; and

(vi) The Claimant’s right to bring a civil action under Section 502(a) of ERISA following an
adverse benefit determination.

(c) Request for Review. Within sixty (60) days after the receipt by the Claimant of
the written opinion described above, the Claimant may request in writing that the Plan
Administrator review its determination. The Claimant or his or her duly authorized representative
may, but need not, review the pertinent documents and submit issues and comments in writing for
consideration by the Plan Administrator. If the Claimant does not request a review of the initial
determination within such sixty (60) day period, the Claimant shall be barred and estopped from
challenging the determination.

 

16

 

(d) Review of Decision. Within sixty (60) days after the Plan Administrator’s receipt
of a request for review, it will review the initial determination. After considering all materials
presented by the Claimant, the Plan Administrator will render a written
opinion, written in a manner calculated to be understood by the Claimant, setting forth the
specific reasons for the decision and containing specific references to the pertinent provisions of
the Plan on which the decision is based. If special circumstances require that the sixty (60) day
time period be extended, the Plan Administrator will so notify the Claimant and will render the
decision as soon as possible, but no later than one hundred twenty (120) days after receipt of the
request for review.

7.3. Designation of Beneficiary. Each Participant may designate a Beneficiary or
Beneficiaries (which Beneficiary may be an entity other than a natural person) to receive any
payments which may be made following the Participant’s death. Such designation may be changed or
canceled at any time without the consent of any such Beneficiary. Any such designation, change or
cancellation must be made in a form approved by the Plan Administrator and shall not be effective
until received by the Plan Administrator, or its designee. If no Beneficiary has been named, or
the designated Beneficiary or Beneficiaries shall have predeceased the Participant, the Beneficiary
shall be the Participant’s estate. If a Participant designates more than one Beneficiary, the
interests of such Beneficiaries shall be paid in equal shares, unless the Participant has
specifically designated otherwise.

7.4. Limitation of Participant’s Right. Nothing in this Plan shall be construed as
conferring upon any Participant any right to continue in Service, nor shall it interfere with the
rights of the Employer to terminate the employment of any Participant and/or to take any personnel
action affecting any Participant without regard to the effect which such action may have upon such
Participant as a recipient or prospective recipient of benefits under the Plan. Any amounts
payable hereunder shall not be deemed salary or other compensation to a Participant for the
purposes of computing benefits to which the Participant may be entitled under any other arrangement
established by the Company or its Affiliates for the benefit of its employees.

7.5. No Limitation on Company Actions. Nothing contained in the Plan shall be
construed to prevent the Company from taking any action which is deemed by it to be appropriate or
in its best interest.

7.6. Obligations to Participating Employer. If a Participant becomes entitled to a
distribution of benefits under the Plan, and if at such time the Participant has outstanding any
debt, obligation, or other liability representing an amount owing to the Participating Employer,
then the Participating Employer may offset such amount owed to it against the amount of benefits
otherwise distributable. Such determination shall be made by the Plan Administrator in its sole
discretion.

7.7. Nonalienation of Benefits. Except as expressly provided herein, no Participant
or Beneficiary shall have the power or right to transfer (otherwise than by will or the laws of
descent and distribution), alienate, or otherwise encumber the Participant’s or Beneficiary’s
interest under the Plan. The Participating Employer’s obligations under this Plan are not
assignable or transferable, except to (a) any corporation or other entity which acquires all or
substantially all of the Participating Employer’s assets or (b) any corporation or other entity
into which the Participating Employer may be merged or consolidated. The provisions of the Plan
shall inure to the benefit of each Participant and the Participant’s Beneficiaries, heirs,
executors, administrators or successors in interest.

 

17

 

7.8. Protective Provisions. Each Participant shall cooperate with the Company by
furnishing any and all information requested by the Company in order to facilitate the payment of
benefits hereunder, taking such physical examinations as the Company may deem necessary and taking
such other relevant action as may be requested by the Company. If a Participant refuses to
cooperate, the Company shall have no further obligation to the Participant under the Plan, other
than payment to such Participant of the then current vested balance of the Participant’s Class Year
Distribution Account(s) in accordance with his or her applicable Enrollment Agreement and/or
Subsequent Election.

7.9. Taxes. The Participating Employer may make such provisions and take such action
as it may deem appropriate for the withholding of any taxes which the Participating Employer is
required by any law or regulation of any governmental authority, whether Federal, state or local,
to withhold in connection with any benefits under the Plan, including, but not limited to, the
withholding of appropriate sums from any amount otherwise payable to the Participant (or his or her
Beneficiary). Each Participant, however, shall be responsible for the payment of all individual
tax liabilities relating to any such benefits.

7.10. Unfunded Status of Plan. The Plan is an “unfunded” plan for tax and ERISA
purposes. This means that the value of each Class Year Distribution Account of a Participant is
based on the value assigned to a hypothetical bookkeeping account, which is invested in
hypothetical shares or units of investments funds available under the Plan. As the nature of the
investment fund which forms the “index” or “meter” for the valuation of the bookkeeping account
changes, the valuation of the bookkeeping account changes as well. The amount owed to a
Participant is based on the value assigned to the bookkeeping account. The Company may decide to
use a “rabbi trust” to anticipate its potential Plan liabilities, and it may attempt to have Plan
investments mirror the hypothetical investments deemed credited to the bookkeeping accounts.
However, the liability to pay the benefits is the Company’s, and the assets of the rabbi trust are
potentially available to satisfy the claims of non-participant creditors of the Company. Each
Class Year Distribution Account of a Participant shall at all times represent a general obligation
of the Company. The Participant shall be a general creditor of the Company with respect to this
obligation, and shall not have a secured or preferred position with respect to the Participant’s
Class Year Distribution Account(s). Nothing contained herein shall be deemed to create an escrow,
trust, custodial account or fiduciary relationship of any kind.

7.11. Severability. If any provision of this Plan is held unenforceable, the
remainder of the Plan shall continue in full force and effect without regard to such unenforceable
provision and shall be applied as though the unenforceable provision were not contained in the
Plan.

7.12. Governing Law. The Plan shall be construed in accordance with and governed by
the laws of the State of California, without reference to the principles of conflict of laws.

7.13. Headings. Headings are inserted in this Plan for convenience of reference only
and are to be ignored in the construction of the provisions of the Plan.

 

18

 

7.14. Gender, Singular and Plural. All pronouns and any variations thereof shall be
deemed to refer to the masculine, feminine, or neuter, as the identity of the person or persons may
require. As the context may require, the singular may read as the plural and the plural as the
singular.

7.15. Notice. Any notice or filing required or permitted to be given to the Plan
Administrator under the Plan shall be sufficient if in writing and hand delivered, or sent by
registered or certified mail, to Spectrum Pharmaceuticals, Inc. ADDRESS: 11500 South Eastern
Avenue, Suite 240, Henderson, NV 89052 Attention: Chief Financial Officer, or to such other entity
as the Plan Administrator may designate from time to time. Such notice shall be deemed given as of
the date of delivery, or, if delivery is made by mail, as of the date shown on the postmark on the
receipt for registration or certification.

 

19

 

IN WITNESS WHEREOF, Spectrum Pharmaceuticals, Inc. has caused this Plan to be executed by its
officer thereunto duly authorized, on this 2nd day of September 2011.

	 	 	 	 	 
	 	SPECTRUM PHARMACEUTICALS, INC.

 	 
	 	By:  	/s/ Brett L. Scott
 	 
	 	 	Name:  	Brett L. Scott 	 
	 	 	Title:  	Acting Chief Financial Officer 	 

 

20

 

	 	 	 	 	 

Appendix A

NONE.

 

21exv4w1

Exhibit 4.1

CERTIFICATE OF DESIGNATION OF

SERIES A CONVERTIBLE PERPETUAL PREFERRED STOCK OF

XPO LOGISTICS, INC.

Pursuant to Section 151 of the

General Corporation Law of the State of Delaware

          XPO Logistics, Inc., a Delaware corporation (the “Company”), certifies that pursuant
to the authority contained in its Amended and Restated Certificate of Incorporation (as amended,
the “Certificate of Incorporation”), and in accordance with the provisions of Section 151
of the General Corporation Law of the State of Delaware (the “DGCL”), the Board of
Directors of the Company (the “Board of Directors”), by resolution adopted by unanimous
written consent pursuant to Section 141(f) of the DGCL, on September 1, 2011, duly approved and
adopted the following resolution, which resolution remains in full force and effect on the date
hereof:

     RESOLVED, that pursuant to the authority vested in the Board of Directors by
the Amended and Restated Certificate of Incorporation, as amended, the Board of
Directors does hereby designate, create, authorize and provide for the issue of a
series of the Company’s preferred stock, par value $0.001 per share, with an
initial liquidation preference of $1,000 per share (the “Initial Liquidation
Preference”), subject to accretion and adjustment as provided in Sections 2(c)
and 15(a) of this Certificate of Designation, which shall be designated as Series
A Convertible Perpetual Preferred Stock (the “Series A Preferred Stock”),
consisting of 75,000 shares, no shares of which have heretofore been issued by the
Company, having the following powers, designations, preferences and relative,
participating, optional and other special rights, and qualifications, limitations
and restrictions thereof:

          Certain defined terms used in this Certificate of Designation have the meanings assigned
thereto in Section 13.

          Section 1. Ranking. The Series A Preferred Stock shall rank, with respect to payment
of dividends and distribution of assets upon the liquidation, winding-up or dissolution of the
Company, (i) senior to the common stock, par value $0.001 per share, of the Company (the
“Common Stock”), whether now outstanding or hereafter issued, and to each other class or
series of stock of the Company (including any series of preferred stock established after September
2, 2011 (the “Issue Date”) by the Board of Directors) the terms of which do not expressly
provide that such class or series ranks senior to or pari passu with the Series A
Preferred Stock as to payment of dividends and distribution of assets upon the liquidation,
winding-up or dissolution of the Company (collectively referred to as “Junior Stock”); (ii)
pari passu with each class or series of stock of the Company (including any series
of preferred stock established after the Issue Date by the Board of Directors) the terms of which
expressly provide that such class or

 

 

series ranks pari passu with the Series A Preferred Stock as to payment of
dividends and distribution of assets upon the liquidation, winding-up or dissolution of the Company
(collectively referred to as “Parity Stock”); and (iii) junior to each other class or
series of stock of the Company (including any series of preferred stock established after the Issue
Date by the Board of Directors) the terms of which expressly provide that such class or series
ranks senior to the Series A Preferred Stock as to payment of dividends and distribution of assets
upon the liquidation, winding-up or dissolution of the Company (collectively referred to as
“Senior Stock”). The Company’s ability to issue Capital Stock that ranks pari
passu with or senior to the Series A Preferred Stock shall be subject to the provisions of
Section 4.

          Section 2. Dividends. (a) General. Dividends on the Series A Preferred
Stock shall be payable quarterly, when, as and if declared by the Board of Directors or a duly
authorized committee thereof, out of the assets of the Company legally available therefor, on the
15th calendar day (or the following Business Day if the 15th is not a
Business Day) of January, April, July and October of each year (each such date being referred to
herein as a “Dividend Payment Date”) at the rate per annum of 4% per share on the Accreted
Liquidation Preference in effect at such time (subject to the following paragraph), which Accreted
Liquidation Preference is subject to adjustment as provided in Section 15(a). The initial dividend
on the Series A Preferred Stock for the dividend period commencing on the Issue Date to but
excluding October 17, 2011, will be $5.00 per share (subject to the following paragraph), and shall
be payable, when, as and if declared, on October 17, 2011. The amount of dividends payable for any
other period that is shorter or longer than a full quarterly dividend period will be computed on
the basis of a 360-day year consisting of twelve 30-day months.

          In the event that dividends are paid on shares of Common Stock in any dividend period with
respect to the Series A Preferred Stock, then the dividend payable in respect of each share of
Series A Preferred Stock for such period shall be equal to the greater of (i) the amount otherwise
payable in respect of such share of Series A Preferred Stock in accordance with the foregoing
paragraph and (ii) the product of (A) the aggregate dividends payable per share of Common Stock in
such dividend period times (B) the number of shares of Common Stock into which such share of Series
A Preferred Stock is then convertible.

          A dividend period with respect to a Dividend Payment Date is the period commencing on the
preceding Dividend Payment Date or, if none, the Issue Date, and ending on the day immediately
prior to the next Dividend Payment Date. Dividends payable, when, as and if declared, on a
Dividend Payment Date shall be payable to Holders of record on the later of (i) the close of
business on the first calendar day (or the following Business Day if such first calendar day is not
a Business Day) of the calendar month in which the applicable Dividend Payment Date falls and (ii)
the close of business on the day on which the Board of Directors or a duly authorized committee
thereof declares the dividend payable (each, a “Dividend Record Date”).

          The Company shall make each dividend payment on the Series A Preferred Stock in cash.

2

 

          Holders shall not be entitled to any dividend in excess of the then-applicable full accrued
dividends calculated pursuant to this Section 2(a) on shares of Series A Preferred Stock. No
interest or sum of money in lieu of interest shall be payable in respect of any dividend or payment
which may be in arrears. All references in this Certificate of Designation to dividends or to a
dividend rate or accretion rate shall be deemed to reflect any adjustment to the dividend rate or
accretion rate pursuant to this Certificate of Designation.

          (b) Payment Restrictions. No dividends or other distributions (other than a dividend
or distribution payable solely in shares of Parity Stock or Junior Stock (in the case of Parity
Stock) or Junior Stock (in the case of Junior Stock) and other than cash paid in lieu of fractional
shares) may be declared, made or paid, or set apart for payment upon, any Parity Stock or Junior
Stock, nor may any Parity Stock or Junior Stock be redeemed, purchased or otherwise acquired for
any consideration (or any money paid to or made available for a sinking fund for the redemption of
any Parity Stock or Junior Stock) by or on behalf of the Company (except by conversion into or
exchange for shares of Parity Stock or Junior Stock (in the case of Parity Stock) or Junior Stock
(in the case of Junior Stock)), unless all accrued and unpaid dividends (including any accrued and
unpaid dividends that have accreted pursuant to Section 2(c) and are reflected in the Accreted
Liquidation Preference) shall have been or contemporaneously are declared and paid, or are declared
and a sum of cash sufficient for the payment thereof is set apart for such payment, on the Series A
Preferred Stock and any Parity Stock for all dividend payment periods terminating on or prior to
the date of such declaration, payment, redemption, purchase or acquisition. Notwithstanding the
foregoing, if full dividends have not been paid on the Series A Preferred Stock and any Parity
Stock, dividends may be declared and paid on the Series A Preferred Stock and such Parity Stock so
long as the dividends are declared and paid pro rata so that the aggregate amounts
of dividends declared per share on, and the amounts of such dividends declared in cash per share
on, the Series A Preferred Stock and such Parity Stock will in all cases bear to each other the
same ratio that accrued and unpaid dividends per share on the shares of Series A Preferred Stock
and such other Parity Stock bear to each other.

          (c) Accretion. If the Company is unable to, or otherwise fails to, pay dividends in
full on the Series A Preferred Stock on any Dividend Payment Date as described above in Section
2(a), the Accreted Liquidation Preference will be increased as of the first day of the immediately
succeeding dividend period by the Accretion Amount in respect of the unpaid dividends. If the
Company pays a portion of the dividends payable on the Series A Preferred Stock on a Dividend
Payment Date and accretes the unpaid portion, the Company will pay the current portion equally and
ratably to Holders of Series A Preferred Stock. The amount of dividends payable for any dividend
period following a non-payment of dividends will be calculated on the basis of the Accreted
Liquidation Preference as of the first day of the relevant dividend period.

          The Company may pay all or a portion of the amount by which the Accreted Liquidation
Preference of a share of Series A Preferred Stock exceeds the Initial Liquidation Preference of a
share of Series A Preferred Stock on (i) any Dividend Payment Date or (ii) any other date fixed by
the Board of Directors or a duly authorized

3

 

committee thereof. The Company shall make any such payment in cash and any such payment shall
be made equally and ratably to Holders of Series A Preferred Stock. The Accreted Liquidation
Preference of each share of Series A Preferred Stock will be reduced as of the first day following
the date of such payment by the amount of such payment (the “Paydown Amount”) and the
amount of dividends will be calculated on the basis of the reduced Accreted Liquidation Preference
for the period of time from the date of such reduction until the applicable Dividend Payment Date.

          The Company will use its reasonable best efforts to provide notice to Holders of the Series A
Preferred Stock not later than ten days prior to each Dividend Payment Date if the Company
determines that it will not pay dividends on that Dividend Payment Date. Such notice shall be
given by issuing a press release in accordance with Section 10(a) and by notifying the Transfer
Agent. If a development occurs less than ten days prior to a Dividend Payment Date that will
prevent the Company from paying dividends on that Dividend Payment Date, and the Company has not
already provided notice, the Company will provide prompt notice to the Holders and the Transfer
Agent as set forth above. The notice will indicate whether the Company will accrete all or a
portion of the dividends, as well as the amount of the dividends to be accreted. Any failure by
the Company to deliver such notice will not impair the Company’s ability to accrete dividends in
any respect.

          Section 3. Liquidation Preference. In the event of any voluntary or involuntary
liquidation, dissolution or winding-up of the Company, each Holder shall be entitled to receive out
of the assets of the Company available for distribution to stockholders of the Company, before any
distribution of assets is made on the Common Stock or any other Junior Stock, an amount equal to
the greater of (i) the aggregate Accreted Liquidation Preference attributable to shares of Series A
Preferred Stock held by such Holder, subject to adjustment as provided in Section 15(a), plus an
amount equal to the sum of all accrued and unpaid dividends (whether or not declared) for the
then-current dividend period, and (ii) the product of (x) the amount per share that would have been
payable upon such liquidation, dissolution or winding-up to the holders of shares of Common Stock
or such other class or series of securities into which the Series A Preferred Stock is then
convertible (assuming the conversion of each share of Series A Preferred Stock and without
deduction for the Accreted Liquidation Preference otherwise payable pursuant to clause (i)),
multiplied by (y) the number of shares of Common Stock or such other securities into which the
shares of Series A Preferred Stock held by such Holder are then convertible.

          None of (i) the sale of all or substantially all of the property or business of the Company
(other than in connection with the voluntary or involuntary liquidation, dissolution or winding-up
of the Company), (ii) the merger, conversion or consolidation of the Company into or with any other
Person or (iii) the merger, conversion or consolidation of any other Person into or with the
Company, shall constitute a voluntary or involuntary liquidation, dissolution or winding-up of the
Company for the purposes of the immediately preceding paragraph.

4

 

          In the event the assets of the Company available for distribution to Holders upon any
liquidation, winding-up or dissolution of the Company, whether voluntary or involuntary, shall be
insufficient to pay in full all amounts to which such Holders are entitled pursuant to this Section
3, no such distribution shall be made on account of any shares of Parity Stock upon such
liquidation, dissolution or winding-up unless proportionate distributable amounts shall be paid on
account of the shares of Series A Preferred Stock, ratably, in proportion to the full distributable
amounts for which Holders and holders of any Parity Stock are entitled upon such liquidation,
winding-up or dissolution, with the amount allocable to each series of such stock determined on a
pro rata basis of the aggregate liquidation preference of the outstanding shares of
each series and accrued and unpaid dividends to which each series is entitled.

          After the payment to the Holders of the full preferential amounts provided for above, the
Holders as such shall have no right or claim to any of the remaining assets of the Company.

          Section 4. Voting Rights. (a) The Holders of shares of Series A Preferred Stock
shall be entitled to vote along with the holders of Common Stock on all matters on which holders of
Common Stock are entitled to vote. The Holders shall participate in such votes as if the shares of
Series A Preferred Stock were converted into shares of Common Stock in accordance with this
Certificate of Designation as of the record date for the determination of holders of Common Stock
entitled to vote. In addition, each Holder shall have one vote for each share of Series A
Preferred Stock held by such Holder on all matters voted upon by the holders of Series A Preferred
Stock as a separate class, as well as voting rights specifically required by the DGCL from time to
time.

          (b) So long as any Series A Preferred Stock is outstanding, in addition to any other vote of
stockholders of the Company required under applicable law or the Certificate of Incorporation, the
affirmative vote or consent of the Holders of at least a majority of the outstanding shares of the
Series A Preferred Stock, voting separately as a single class, will be required (i) for any
amendment of the Certificate of Incorporation if the amendment would alter or change the powers,
preferences, privileges or rights of the Holders so as to affect them adversely, (ii) to issue,
authorize or increase the authorized amount of, or issue or authorize any obligation or security
convertible into or evidencing a right to purchase, any Parity Stock or Senior Stock, or (iii) to
reclassify any authorized stock of the Company into any Parity Stock or Senior Stock, or any
obligation or security convertible into or evidencing a right to purchase any Parity Stock or
Senior Stock, provided that, for avoidance of doubt, no such vote shall be required for the
Company to issue, authorize or increase the authorized amount of, or issue or authorize any
obligation or security convertible into or evidencing a right to purchase, any Junior Stock.

          Section 5. Conversion at the Option of the Holder. (a) Each share of Series A
Preferred Stock is convertible, in whole or in part, at the option of the Holder thereof
(“Optional Conversion”), into the number of shares of Common Stock (the “Conversion
Rate”) obtained by dividing (i) the Accreted Liquidation Preference by (ii) the Conversion
Price then in effect.

5

 

          (b) Holders of shares of Series A Preferred Stock who convert their shares on a day other than
a Dividend Payment Date will not be entitled to any accrued dividends for the dividend period in
which they convert their shares. Accordingly, shares of Series A Preferred Stock surrendered for
Optional Conversion after the close of business on a Dividend Record Date and before the opening of
business on the immediately succeeding Dividend Payment Date must be accompanied by payment in cash
of an amount equal to the dividend payable on such shares on such Dividend Payment Date. Such
Holders will be entitled to receive the dividend payment on those shares on that Dividend Payment
Date. A Holder on a Dividend Record Date who (or whose transferee) surrenders any shares for
conversion on the corresponding Dividend Payment Date shall receive the dividend payable by the
Company on the Series A Preferred Stock on that date (and if the Company fails to pay such
dividend, such Holder’s shares converted on such date will be converted at a Conversion Rate that
reflects the Accreted Liquidation Preference after giving effect to such failure), and the
converting Holder shall not be required to include payment in the amount of such dividend upon
surrender of shares of Series A Preferred Stock for conversion. Except as provided above, upon any
Optional Conversion of shares of Series A Preferred Stock, the Company shall make no payment or
allowance for unpaid dividends, whether or not in arrears, on such shares of Series A Preferred
Stock as to which Optional Conversion has been effected or for dividends on the shares of Common
Stock issued upon such Optional Conversion.

          (c) The conversion right of a Holder shall be exercised by the Holder of shares of Series A
Preferred Stock by the surrender to the Company of the certificates representing shares of Series A
Preferred Stock to be converted at any time during usual business hours at its principal place of
business or the offices of the Transfer Agent, accompanied by written notice to the Company that
the Holder elects to convert all or a portion of the shares of Series A Preferred Stock represented
by such certificate and specifying the name or names (with address) in which a certificate or
certificates or other appropriate evidence of ownership representing shares of Common Stock are to
be issued and (if so required by the Company or the Transfer Agent) by a written instrument or
instruments of transfer in form reasonably satisfactory to the Company or the Transfer Agent duly
executed by the Holder or its duly authorized legal representative and transfer tax stamps or funds
therefor, if required pursuant to Section 15(f). The date on which a Holder satisfies the
foregoing requirements for conversion is referred to herein as the “Conversion Date.” The
Company will deliver shares of Common Stock (or such other class or series of securities into which
the Series A Preferred Stock is then convertible) due upon conversion, together with any cash in
lieu of fractional shares in accordance with Section 14 hereof, in accordance with Section 6.
Immediately prior to the close of business on the Conversion Date, each converting Holder shall be
deemed to be the holder of record of the shares of Common Stock (or such other class or series of
securities into which the Series A Preferred Stock is then convertible) issuable upon conversion of
such Holder’s Series A Preferred Stock notwithstanding that the share register of the Company shall
then be closed or that certificates or other appropriate evidence of ownership representing such
Common Stock (or such other class or series of securities into which the Series A Preferred Stock
is then convertible) shall not then be actually delivered to such Holder. On the Conversion Date,
all rights with respect to the

6

 

shares of Series A Preferred Stock so converted, including the rights, if any, to receive
notices, will terminate, except the rights of Holders thereof to (a) receive certificates or other
appropriate evidence of ownership representing the number of whole shares of Common Stock (or such
other class or series of securities into which the Series A Preferred Stock is then convertible)
into which such shares of Series A Preferred Stock have been converted and cash in lieu of any
fractional shares, in accordance with Section 14 hereof and (b) exercise the rights to which they
are entitled as holders of Common Stock (or such other class or series of securities into which the
Series A Preferred Stock is then convertible).

          Section 6. Settlement upon Conversion. The Company shall satisfy its obligation to
deliver shares of Common Stock (or such other class or series of securities into which the Series A
Preferred Stock is then convertible) upon conversion of Series A Preferred Stock by delivering to
Holders surrendering shares for conversion a number of shares of Common Stock (or such other class
or series of securities into which the Series A Preferred Stock is then convertible) equal to the
product of (x) the aggregate number of shares of Series A Preferred Stock to be converted
multiplied by (y) the Conversion Rate then in effect (provided that the Company will
deliver cash in lieu of fractional shares in accordance with Section 14), as soon as practicable
after the third Trading Day (but in no event later than the fifth Business Day) following the
Conversion Date.

          Section 7. Anti-dilution Adjustments. (a) The Conversion Price shall be subject to
the following adjustments from time to time:

     (i) Stock Dividends. In case the Company shall pay or make a dividend
or other distribution on the Common Stock in Common Stock, the Conversion Price, as
in effect at the opening of business on the day following the date fixed for the
determination of stockholders of the Company entitled to receive such dividend or
other distribution, shall be adjusted by multiplying such Conversion Price by a
fraction of which the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such determination and
the denominator shall be the sum of such number of shares and the total number of
shares constituting such dividend or other distribution, such adjustment to become
effective immediately after the opening of business on the day following the date
fixed for such determination.

     (ii) Stock Purchase Rights. In case the Company shall issue to all
holders of its Common Stock options, warrants or other rights entitling them to
subscribe for or purchase shares of Common Stock for a period expiring within 60
days from the date of issuance of such options, warrants or other rights at a price
per share of Common Stock less than the Market Value on the date fixed for the
determination of stockholders of the Company entitled to receive such options,
warrants or other rights (other than pursuant to a dividend reinvestment, share
purchase or similar plan), the Conversion Price in effect at the opening of
business on the day

7

 

following the date fixed for such determination shall be
adjusted by multiplying such Conversion Price by a fraction, the numerator of which shall
be the number of shares of Common Stock outstanding at the close of business on the
date fixed for such determination plus the number of shares of Common Stock which
the aggregate consideration expected to be received by the Company upon the
exercise, conversion or exchange of such options, warrants or other rights (as
determined in good faith by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution) would purchase at such Market Value
and the denominator of which shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such determination plus
the number of shares of Common Stock so offered for subscription or purchase,
either directly or indirectly, such adjustment to become effective immediately
after the opening of business on the day following the date fixed for such
determination; provided, however, that no such adjustment to the
Conversion Price shall be made if the Holders would be entitled to receive such
options, warrants or other rights upon conversion at any time of shares of Series A
Preferred Stock into Common Stock; provided, further,
however, that if any of the foregoing options, warrants or other rights are
only exercisable upon the occurrence of a Triggering Event, then the Conversion
Price will not be adjusted until such Triggering Event occurs.

     (iii) Stock Splits, Reverse Splits and Combinations. In case
outstanding shares of Common Stock shall be subdivided, split or reclassified into
a greater number of shares of Common Stock, the Conversion Price in effect at the
opening of business on the day following the day upon which such subdivision, split
or reclassification becomes effective shall be proportionately reduced, and,
conversely, in case outstanding shares of Common Stock shall be combined or
reclassified into a smaller number of shares of Common Stock, the Conversion Price
in effect at the opening of business on the day following the day upon which such
combination or reclassification becomes effective shall be proportionately
increased, such reduction or increase, as the case may be, to become effective
immediately after the opening of business on the day following the day upon which
such subdivision, split, reclassification or combination becomes effective.

     (iv) Debt, Asset or Security Distributions. (A) In case the Company
shall, by dividend or otherwise, distribute to all holders of its Common Stock
evidences of its indebtedness, assets or securities (but excluding any dividend or
distribution of options, warrants or other rights referred to in paragraph (ii) of
this Section 7(a), any dividend or distribution paid exclusively in cash, any
dividend or distribution of shares of Capital Stock of any class or series, or
similar equity interests, of or relating to a Subsidiary or other business unit in
the case of a Spin-off referred to in the next subparagraph, or any dividend or
distribution

8

 

referred to in paragraph (i) of this Section 7(a)), the Conversion
Price shall be reduced by multiplying the Conversion Price in effect immediately prior to
the close of business on the date fixed for the determination of stockholders of
the Company entitled to receive such distribution by a fraction, the numerator of
which shall be the Market Value on the date fixed for such determination and the
denominator of which shall be such Market Value plus the fair market value (as
determined in good faith by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution) of the portion of the assets or
evidences of indebtedness so distributed applicable to one share of Common Stock,
such adjustment to become effective immediately prior to the opening of business on
the day following the date fixed for the determination of stockholders of the
Company entitled to receive such distribution. In any case in which this
subparagraph (iv)(A) is applicable, subparagraph (iv)(B) of this Section 7(a) shall
not be applicable.

     (B) In the case of a Spin-off, the Conversion Price in effect
immediately prior to the close of business on the date fixed for
determination of stockholders of the Company entitled to receive such
distribution shall be reduced by multiplying the Conversion Price by a
fraction, the numerator of which shall be the Market Value and the
denominator of which shall be the Market Value plus the fair market value
(as determined in good faith by the Board of Directors, whose
determination shall be conclusive and described in a Board Resolution) of
the portion of those shares of Capital Stock or similar equity interests
so distributed applicable to one share of Common Stock. Any adjustment to
the Conversion Price under this subparagraph (iv)(B) will occur on the
date that is the earlier of (1) the tenth Trading Day from, and including,
the effective date of the Spin-off and (2) the date of the Initial Public
Offering of the securities being distributed in the Spin-off, if that
Initial Public Offering is effected simultaneously with the Spin-off.

     (v) Tender Offers. In the case that a tender or exchange offer made
by the Company or any Subsidiary of the Company for all or any portion of the
Common Stock shall expire and such tender or exchange offer (as amended through the
expiration thereof) shall require the payment to stockholders of the Company (based
on the acceptance (up to any maximum specified in the terms of the tender or
exchange offer) of Purchased Shares) of aggregate consideration having a fair
market value (as determined in good faith by the Board of Directors, whose
determination shall be conclusive and described in a Board Resolution) per share of
Common Stock that exceeds the Closing Sale Price of the Common Stock on the Trading
Day next succeeding the last date on which tenders or exchanges may be made
pursuant to such tender or exchange offer, then, immediately prior to the opening
of business on the day after the date of the last time (the “Expiration
Time”) tenders or exchanges

9

 

could have been made pursuant to such tender or
exchange offer (as amended through the expiration thereof), the Conversion Price shall be reduced
by multiplying the Conversion Price immediately prior to the close of business on
the date of the Expiration Time by a fraction (A) the numerator of which shall be
equal to the product of (x) the Market Value on the date of the Expiration Time and
(y) the number of shares of Common Stock outstanding (including any tendered or
exchanged shares) on the date of the Expiration Time, and (B) the denominator of
which shall be equal to (x) the product of (I) the Market Value on the date of the
Expiration Time and (II) the number of shares of Common Stock outstanding
(including any tendered or exchanged shares) on the date of the Expiration Time
less the number of all shares validly tendered or exchanged, not withdrawn and
accepted for payment on the date of the Expiration Time (such validly tendered or
exchanged shares, up to any such maximum, being referred to as the “Purchased
Shares”) plus (y) the amount of cash plus the fair market value (determined as
aforesaid) of the aggregate consideration payable to stockholders of the Company
pursuant to the tender or exchange offer (assuming the acceptance, up to any
maximum specified in the terms of the tender or exchange offer, of Purchased
Shares).

          (b) De Minimis Adjustments. Notwithstanding anything herein to the contrary, no
adjustment under this Section 7 need be made to the Conversion Price unless such adjustment would
require an increase or decrease of at least 1.0% of the Conversion Rate then in effect. Any lesser
adjustment shall be carried forward and shall be made at the time of and together with the next
subsequent adjustment, if any, which, together with any adjustment or adjustments so carried
forward, shall result in an increase or decrease of at least 1.0% of such Conversion Rate. No
adjustment under this Section 7 shall be made if such adjustment will result in a Conversion Price
that is less than the par value of the Common Stock. All adjustments to the Conversion Rate shall
be calculated to the nearest 1/10,000th of a share of Common Stock (or if there is not a nearest
1/10,000th of a share to the next lower 1/10,000th of a share).

          (c) Tax-Related Adjustments. The Company may make such reductions in the Conversion
Price, in addition to those required by this Section 7, as the Board of Directors considers
advisable in order to avoid or diminish any income tax to any holders of shares of Common Stock
resulting from any dividend or distribution of stock or issuance of rights or warrants to purchase
or subscribe for stock or from any event treated as such for income tax purposes. In the event the
Company elects to make such a reduction in the Conversion Price, the Company will comply with the
requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations
thereunder if and to the extent that such laws and regulations are applicable in connection with
the reduction in the Conversion Price.

          (d) Stockholder Rights Plans. Upon conversion of the Series A Preferred Stock, to the
extent that the Holders receive Common Stock, such Holders shall receive, in addition to the shares
of Common Stock and any cash for fractional shares in

10

 

accordance with Section 14, if any, the
rights issued under any future stockholder rights
plan the Company may establish whether or not such rights are separated from the Common Stock
prior to conversion. A distribution of rights pursuant to any stockholder rights plan will not
result in an adjustment to the Conversion Price pursuant to Section 7(a)(ii) or 7(a)(iv),
provided that the Company has provided for the Holders to receive such rights upon
conversion.

          (e) Notice of Adjustment. Whenever the Conversion Price is adjusted in accordance
with this Section 7, the Company shall (i) compute the Conversion Price in accordance with this
Section 7 and prepare and transmit to the Transfer Agent an Officer’s Certificate setting forth the
Conversion Price, the method of calculation thereof in reasonable detail, and the facts requiring
such adjustment and upon which such adjustment is based and (ii) as soon as practicable following
the occurrence of an event that requires an adjustment to the Conversion Price pursuant to this
Section 7 (or if the Company is not aware of such occurrence, as soon as practicable after becoming
so aware), the Company or, at the request and expense of the Company, the Transfer Agent shall
provide a written notice to the Holders of the occurrence of such event and a statement setting
forth in reasonable detail the method by which the adjustment to the Conversion Price was
determined and setting forth the adjusted Conversion Price.

          (f) Reversal of Adjustment. If the Company shall take a record of the holders of its
Common Stock for the purpose of entitling them to receive a dividend or other distribution, and
shall thereafter (and before the dividend or distribution has been paid or delivered to
stockholders) legally abandon its plan to pay or deliver such dividend or distribution, then
thereafter no adjustment in the Conversion Price then in effect shall be required by reason of the
taking of such record.

          (g) Exceptions to Adjustment. The applicable Conversion Price shall not be adjusted:

     (i) upon the issuance of any shares of Common Stock pursuant to any present or
future plan providing for the reinvestment of dividends or interest payable on the
Company’s securities and the investment of additional optional amounts in shares of
Common Stock under any such plan;

     (ii) upon the issuance of any shares of Common Stock or options or rights to
purchase those shares pursuant to any present or future employee, director or
consultant benefit plan or program of or assumed by the Company or any of its
Subsidiaries;

     (iii) upon the issuance of any shares of Common Stock pursuant to any option,
warrant, right or exercisable, exchangeable or convertible security outstanding as
of the Issue Date;

     (iv) for a change in the par value of the Common Stock;

11

 

     (v) for accrued and unpaid dividends on the Series A Preferred Stock; or

     (vi) for the 4-for-1 reverse stock split consummated on the Issue Date
pursuant to the Investment Agreement dated as of June 13, 2011, by and among Jacobs
Private Equity, LLC, the other investors party thereto (including by joinders
thereto) and the Company.

          Section 8. Recapitalizations, Reclassifications and Changes in the Company’s Stock.
In the event of any reclassification of outstanding shares of Common Stock (other than a change in
par value, or from par value to no par value, or from no par value to par value), or any
consolidation or merger of the Company with or into another Person (other than with a Subsidiary of
the Company) or any merger of another Person with or into the Company (other than a consolidation
or merger in which the Company is the resulting or surviving Person and that does not result in any
reclassification or change of outstanding Common Stock), or any sale or other disposition to
another Person of all or substantially all of the assets of the Company (computed on a consolidated
basis) (any of the foregoing, a “Transaction”), upon conversion of its shares of Series A
Preferred Stock, a Holder will be entitled to receive the kind and amount of securities (of the
Company or another issuer), cash and other property receivable upon such Transaction by a holder of
the number of shares of Common Stock into which such shares of Series A Preferred Stock were
convertible immediately prior to such Transaction, after giving effect to any adjustment event or,
in the event holders of Common Stock have the opportunity to elect the form of consideration to be
received in any Transaction, the weighted average of the forms and amounts of consideration
received by the holders of the Common Stock. In the event that at any time, as a result of an
adjustment made pursuant to this Certificate of Designation, the Holders shall become entitled upon
conversion to any securities other than, or in addition to, shares of Common Stock, thereafter the
number or amount of such other securities so receivable upon conversion shall be subject to
adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the
provisions with respect to the Common Stock set forth in this Certificate of Designation.

          Section 9. Consolidation, Merger and Sale of Assets. (a) The Company, without the
consent of the Holders (but subject, for avoidance of doubt, to the right of the Holders to vote on
any such transaction in accordance with the first two sentences of Section 4(a)), may consolidate
with or merge into any other Person or convey, transfer or lease all or substantially all its
assets to any Person or may permit any Person to consolidate with or merge into, or transfer or
lease all or substantially all its properties to, the Company; provided, however,
that (i) the successor, transferee or lessee is organized under the laws of the United States or
any political subdivision thereof; (ii) the shares of Series A Preferred Stock will become shares
of such successor, transferee or lessee, having in respect of such successor, transferee or lessee
the same powers, preferences and relative participating, optional or other special rights and the
qualification, limitations or restrictions thereon, the Series A Preferred Stock had immediately
prior to such transaction; and (iii) the Company delivers to the Transfer Agent an Officer’s
Certificate

12

 

and an Opinion of Counsel, acceptable to the Transfer Agent, stating that such
transaction complies with this Certificate of Designation.

          (b) Upon any consolidation by the Company with, or merger by the Company into, any other
Person or any conveyance, transfer or lease of all or substantially all the assets of the Company
as described in Section 9(a), the successor resulting from such consolidation or into which the
Company is merged or the transferee or lessee to which such conveyance, transfer or lease is made,
will succeed to, and be substituted for, and may exercise every right and power of, the Company
under the shares of Series A Preferred Stock, and thereafter, except in the case of a lease, the
predecessor (if still in existence) will be released from its obligations and covenants with
respect to the Series A Preferred Stock.

          Section 10. Notices. (a) When the Company is required, pursuant to this Certificate
of Designation, to give notice to Holders by issuing a press release, rather than directly to
Holders, the Company shall do so in a public medium that is customary for such press release;
provided, however, that in such cases, publication of a press release through the
Dow Jones News Service shall be considered sufficient to comply with such notice obligation.

          (b) When the Company is required, pursuant to this Certificate of Designation, to give notice
to Holders without specifying the method of giving such notice, the Company shall do so by sending
notice via first class mail or by overnight courier to the Holders of record as of a reasonably
current date.

          Section 11. Transfer of Securities. (a) The shares of Series A Preferred Stock and
the shares of Common Stock issuable upon conversion of the Series A Preferred Stock (collectively,
the “Securities”) have not been registered under the Securities Act or any other applicable
securities laws and may not be offered or sold except in compliance with the registration
requirements of the Securities Act and any other applicable securities laws, or pursuant to an
exemption from registration under the Securities Act and any other applicable securities laws, or
in a transaction not subject to such laws. The Securities will have the benefit of certain
registration rights under the Securities Act pursuant to a Registration Rights Agreement entered
into by the Company and the Holders on the Issue Date, a copy of which may be obtained from the
Company by writing to it at XPO Logistics, Inc., 3399 South Lakeshore Drive, Suite 225, Saint
Joseph, MI 49085, Attention: Secretary of the Board of Directors.

          (b) Except in connection with a registration statement relating to the Securities, if shares
of Series A Preferred Stock in certificated form are delivered upon the transfer, exchange or
replacement of shares of Series A Preferred Stock bearing the Restricted Stock Legend, or if a
request is made to remove such Restricted Stock Legend on shares of Series A Preferred Stock, the
shares of Series A Preferred Stock so issued shall bear the Restricted Stock Legend and the
Restricted Stock Legend shall not be removed unless there is delivered to the Company and the
Transfer Agent such satisfactory evidence, which may include an Opinion of Counsel licensed to
practice law in the State of New York, as may be reasonably required by the Company, that such

13

 

shares of Series A Preferred Stock are not “restricted securities” within the meaning of Rule 144
under the Securities Act. Upon provision of such satisfactory evidence, the
Transfer Agent, at the direction of the Company, shall countersign and deliver shares of
Series A Preferred Stock that do not bear the Restricted Stock Legend.

          (c) Shares of Common Stock issued upon a conversion of the shares of Series A Preferred Stock
bearing the Restricted Stock Legend, prior to the first anniversary of the Issue Date, shall be in
global form and bear a restricted common stock legend that corresponds to the Restricted Stock
Legend (the “Restricted Common Stock Legend”).

          (d) The Company will refuse to register any transfer of Securities that is not made in
accordance with the provisions of the Restricted Stock Legend or the Restricted Common Stock
Legend, as applicable, provided that the provisions of this Section 11(d) shall not be
applicable to any Security that does not bear any Restricted Stock Legend or any Restricted Common
Stock Legend.

          Section 12. Tax Treatment. The Company and the Holders acknowledge and agree that it
is intended that the Series A Preferred Stock constitute stock other than “preferred stock” within
the meaning of Section 305 of the Internal Revenue Code of 1986, as amended, and the Treasury
Regulations promulgated thereunder, and that neither the Company nor the Holders shall treat the
Series A Preferred Stock as such.

          Section 13. Definitions. (a) “Accretion Amount” per share of Series A
Preferred Stock for any Dividend Payment Date on which accrued dividends are not paid in full,
means the product of (i) the accretion rate of 4% per annum, calculated on a quarterly basis, as
such may be adjusted pursuant to Section 2(a), (ii) the Accreted Liquidation Preference as of the
first day of the relevant dividend period and (iii) the fraction of the accrued dividends for that
dividend period that were not paid on the Dividend Payment Date.

          (b) “Accreted Liquidation Preference” per share of Series A Preferred Stock means, as
of any date, the Initial Liquidation Preference increased by the sum of the Accretion Amounts, if
any, for all prior Dividend Payment Dates, and decreased by the sum of the Paydown Amounts, if any,
for all prior Dividend Payment Dates or other dates on which Paydown Amounts were paid.

          (c) “Board of Directors” has the meaning set forth in the first paragraph of this
Certificate of Designation.

          (d) “Board Resolution” means a copy of a resolution certified by the Secretary or an
Assistant Secretary of the Company to have been duly adopted by the Board of Directors and to be in
full force and effect on the date of such certification, and delivered to the Transfer Agent.

          (e) “Business Day” means any day other than a Saturday or Sunday or any other day on
which banks in the City of New York are authorized or required by law or executive order to close.

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          (f) “Capital Stock” of any Person means any and all shares, interests, participations
or other equivalents however designated of corporate stock or other equity participations,
including partnership interests, whether general or limited, of such Person and any rights (other
than debt securities convertible or exchangeable into an equity interest), warrants or options to
acquire an equity interest in such Person.

          (g) “Certificate of Incorporation” has the meaning set forth in the first paragraph of
this Certificate of Designation.

          (h) The “Closing Sale Price” of the Common Stock on any date means the closing sale
price per share (or if no closing sale price is reported, the average of the closing bid and ask
prices or, if more than one in either case, the average of the average closing bid and the average
closing ask prices) on such date as reported on the over-the-counter “Pink Sheets” market or, if
the Common Stock is listed on a national securities exchange, the principal national securities
exchange on which the Common Stock is traded. In the absence of such a quotation, the Closing Sale
Price of the Common Stock will be an amount determined in good faith by the Board of Directors to
be the fair market value of such Common Stock, and such determination shall be conclusive.

          (i) “Common Stock” has the meaning set forth in Section 1.

          (j) “Company” has the meaning set forth in the first paragraph of this Certificate of
Designation.

          (k) “Conversion Date” has the meaning set forth in Section 5(c).

          (l) “Conversion Price” shall initially equal $7.00 per share of Common Stock, and
shall be subject to adjustment as set forth in Section 7.

          (m) “Conversion Rate” has the meaning set forth in Section 5(a).

          (n) “DGCL” has the meaning set forth in the first paragraph of this Certificate of
Designation.

          (o) “Dividend Payment Date” has the meaning set forth in Section 2(a).

          (p) “Dividend Record Date” has the meaning set forth in Section 2(a).

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

          (r) “Expiration Time” has the meaning set forth in Section 7(a)(v).

          (s) “Holder” means the Person in whose name a share of Series A Preferred Stock is
registered.

          (t) “including” means “including, without limitation”.

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          (u) “Initial Liquidation Preference” has the meaning set forth in the first paragraph
of this Certificate of Designation.

          (v) “Initial Public Offering” means, in the event of a Spin-off, the first time
securities of the same class or type as the securities being distributed in the Spin-off are bona
fide offered to the public for cash.

          (w) “Issue Date” has the meaning set forth in Section 1.

          (x) “Junior Stock” has the meaning set forth in Section 1.

          (y) “Market Value” means, with respect to any date of determination, the average
Closing Sale Price of the Common Stock for a five consecutive Trading Day period preceding the
earlier of (i) the day preceding the date of determination and (ii) the day before the “ex date”
with respect to the issuance or distribution requiring such computation. For purposes of this
definition, the term “ex date” when used with respect to any issuance or distribution, means the
first date on which the Common Stock trades, regular way, on the over-the-counter “Pink Sheets”
market or, if the Common Stock is listed on a national securities exchange, the principal national
securities exchange on which the Common Stock is traded at that time, without the right to receive
the issuance or distribution.

          (z) “Officer” means the Chairman of the Board, President, Chief Executive Officer, any
Vice President, the Chief Financial Officer, the Chief Accounting Officer, the Treasurer, any
Assistant Treasurer, the Controller, any Assistant Controller, the Secretary or any Assistant
Secretary of the Company.

          (aa) “Officer’s Certificate” means a certificate signed by two Officers.

          (bb) “Opinion of Counsel” means a written opinion from legal counsel who is acceptable
to the Company or the Transfer Agent. The counsel may be an employee of or counsel to the Company
or the Transfer Agent.

          (cc) “Optional Conversion” has the meaning set forth in Section 5(a).

          (dd) “Parity Stock” has the meaning set forth in Section 1.

          (ee) “Paydown Amount” has the meaning set forth in Section 2(c).

          (ff) “Person” means any natural person, corporation, limited liability company,
partnership, joint venture, trust, business association, governmental entity or other entity.

          (gg) “Purchased Shares” has the meaning set forth in Section 7(a)(v).

          (hh) “Restricted Common Stock Legend” has the meaning set forth in Section 11(c).

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          (ii) “Restricted Stock Legend” means a legend to the following effect:

“THE SECURITIES REPRESENTED BY THIS INSTRUMENT AND THE SECURITIES ISSUABLE UPON CONVERSION THEREOF
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR SECURITIES LAWS OF ANY
STATE AND MAY NOT BE TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO A REGISTRATION
STATEMENT RELATING THERETO IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE SECURITIES LAWS OR
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT OR SUCH LAWS.”

          (jj) “Securities” has the meaning set forth in Section 11(a).

          (kk) “Securities Act” means the Securities Act of 1933, as amended.

          (ll) “Senior Stock” has the meaning set forth in Section 1.

          (mm) “Series A Preferred Stock” has the meaning set forth in the first paragraph of
this Certificate of Designation.

          (nn) “Spin-off” means a dividend or other distribution of shares of Capital Stock of
any class or series, or similar equity interests, of or relating to a Subsidiary or other business
unit of the Company.

          (oo) “Subsidiary” of any Person means any other Person (i) more than 50% of whose
outstanding shares or securities representing the right to vote for the election of directors or
other managing authority of such other Person are, now or hereafter, owned or controlled, directly
or indirectly, by such first Person, but such other Person shall be deemed to be a Subsidiary only
so long as such ownership or control exists, or (ii) which does not have outstanding shares or
securities with such right to vote, as may be the case in a partnership, joint venture or
unincorporated association, but more than 50% of whose ownership interest representing the right to
make the decisions for such other Person is, now or hereafter, owned or controlled, directly or
indirectly, by such first Person, but such other Person shall be deemed to be a Subsidiary only so
long as such ownership or control exists.

          (pp) “Trading Day” means a day during which trading in securities generally occurs on
the over-the-counter “Pink Sheets” market or, if the Common Stock is listed on a national
securities exchange, the principal national securities exchange on which the Common Stock is
traded.

          (qq) “Transaction” has the meaning set forth in Section 8.

          (rr) “Transfer Agent” means Computershare Trust Company, N.A. unless and until a
successor is selected by the Company, and then such successor.

17

 

          (ss) “Triggering Event” means a specified event the occurrence of which entitles the
holders of rights, options or warrants to exercise such rights, options or warrants.

          Section 14. Fractional Shares. No fractional shares of Common Stock shall be issued
to Holders. In lieu of any fraction of a share of Common Stock that would otherwise be issuable in
respect of the aggregate number of shares of the Series A Preferred Stock surrendered by a Holder
upon a conversion, such Holder shall have the right to receive an amount in cash (computed to the
nearest cent) equal to the same fraction of the Closing Sale Price on the Trading Day next
preceding the date of conversion.

          Section 15. Miscellaneous. (a) The Accreted Liquidation Preference and the annual
dividend rate and accretion rate set forth herein each shall be subject to equitable adjustment
whenever there shall occur a stock split, combination, reclassification or other similar event
involving the Series A Preferred Stock. Such adjustments shall be determined in good faith by the
Board of Directors (and such determination shall be conclusive) and submitted by the Board of
Directors to the Transfer Agent.

          (b) For the purposes of Section 7, the number of shares of Common Stock at any time
outstanding shall not include shares held in the treasury of the Company but shall include shares
issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock.

          (c) If the Company shall take any action affecting the Common Stock, other than any action
described in Section 7, that in the opinion of the Board of Directors would materially adversely
affect the conversion rights of the Holders, then the Conversion Price for the Series A Preferred
Stock may be adjusted, to the extent permitted by law, in such manner, and at such time, as the
Board of Directors may determine to be equitable in the circumstances.

          (d) The Company covenants that it will at all times reserve and keep available, free from
preemptive rights, out of the aggregate of its authorized but unissued shares of Common Stock for
the purpose of effecting conversion of the Series A Preferred Stock, the full number of shares of
Common Stock deliverable upon the conversion of all outstanding shares of Series A Preferred Stock
not theretofore converted. For purposes of this Section 15(d), the number of shares of Common
Stock that shall be deliverable upon the conversion of all outstanding shares of Series A Preferred
Stock shall be computed as if at the time of computation all such outstanding shares were held by a
single Holder.

          (e) The Company covenants that any shares of Common Stock issued upon conversion of the Series
A Preferred Stock shall be duly and validly issued and fully paid and nonassessable, free from
preemptive rights and free from all taxes, liens, charges and security interests with respect to
the issuance thereof, except for transfer restrictions imposed by applicable securities laws.

18

 

          (f) The Company shall pay all transfer, stamp and other similar taxes due with respect to the
issuance or delivery of shares of Common Stock or other securities or property upon conversion of
the Series A Preferred Stock; provided, however, that the Company shall not be
required to pay any tax that may be payable with respect to any transfer involved in the issuance
or delivery of shares of Common Stock or other securities or property in a name other than that of
the Holder of the Series A Preferred Stock to be converted, and the Holder shall be responsible for
any such tax.

          (g) The Series A Preferred Stock is not redeemable.

          (h) The Series A Preferred Stock is not entitled to any preemptive or subscription rights in
respect of any securities of the Company.

          (i) Whenever possible, each provision hereof shall be interpreted in a manner as to be
effective and valid under applicable law, but if any provision hereof is held to be prohibited by
or invalid under applicable law, such provision shall be ineffective only to the extent of such
prohibition or invalidity, without invalidating or otherwise adversely affecting the remaining
provisions hereof. If a court of competent jurisdiction should determine that a provision hereof
would be valid or enforceable if a period of time were extended or shortened or a particular
percentage were increased or decreased, then such court may make such change as shall be necessary
to render the provision in question effective and valid under applicable law.

          (j) Series A Preferred Stock may be issued in fractions of a share which shall entitle the
Holder, in proportion to such Holder’s fractional shares, to exercise voting rights, receive
dividends, participate in distributions and have the benefit of all other rights of Holders of
Series A Preferred Stock.

          (k) Subject to applicable escheat laws, any monies set aside by the Company in respect of any
payment with respect to shares of the Series A Preferred Stock, or dividends thereon, and unclaimed
at the end of two years from the date upon which such payment is due and payable shall revert to
the general funds of the Company, after which reversion the Holders of such shares shall look only
to the general funds of the Company for the payment thereof. Any interest accumulated on funds so
deposited shall be paid to the Company from time to time.

          (l) Except as may otherwise be required by law, the shares of Series A Preferred Stock shall
not have any voting powers, preferences and relative, participating, optional or other special
rights, other than those specifically set forth in this Certificate of Designation or the
Certificate of Incorporation.

          (m) The headings of the various subdivisions hereof are for convenience of reference only and
shall not affect the interpretation of any of the provisions hereof.

          (n) If any of the voting powers, preferences and relative, participating, optional and other
special rights of the Series A Preferred Stock and qualifications, limitations and restrictions
thereof set forth herein is invalid, unlawful or incapable of being enforced by reason of any rule
of law or public policy, all other voting powers,

19

 

preferences and relative, participating, optional and other special rights of Series A
Preferred Stock and qualifications, limitations and restrictions thereof set forth herein which can
be given effect without the invalid, unlawful or unenforceable voting powers, preferences and
relative, participating, optional and other special rights of Series A Preferred Stock and
qualifications, limitations and restrictions thereof shall, nevertheless, remain in full force and
effect, and no voting powers, preferences and relative, participating, optional or other special
rights of Series A Preferred Stock and qualifications, limitations and restrictions thereof herein
set forth shall be deemed dependent upon any other such voting powers, preferences and relative,
participating, optional or other special rights of Series A Preferred Stock and qualifications,
limitations and restrictions thereof unless so expressed herein.

          (o) Shares of Series A Preferred Stock that (i) have not been issued on or before the Issue
Date or (ii) have been issued and reacquired in any manner, including shares of Series A Preferred
Stock purchased or converted, shall (upon compliance with any applicable provisions of the laws of
Delaware) have the status of authorized but unissued shares of preferred stock of the Company
undesignated as to series and may be designated or redesignated and issued or reissued, as the case
may be, as part of any series of preferred stock of the Company; provided that any issuance
of such shares as Series A Preferred Stock must be in compliance with the terms hereof.

          (p) If any of the Series A Preferred Stock certificates shall be mutilated, lost, stolen or
destroyed, the Company shall issue, in exchange and in substitution for and upon cancellation of
the mutilated Series A Preferred Stock certificate, or in lieu of and substitution for the Series A
Preferred Stock certificate lost, stolen or destroyed, a new Series A Preferred Stock certificate
of like tenor and representing an equivalent amount of shares of Series A Preferred Stock, but only
upon receipt of evidence of such loss, theft or destruction of such Series A Preferred Stock
certificate and indemnity, if requested, satisfactory to the Company and the Transfer Agent.

20

 

          IN WITNESS WHEREOF, the Company has caused this Certificate of Designation to be duly executed
by Michael R. Welch, Chief Executive Officer of the Company, and attested by John D. Welch, Chief
Financial Officer of the Company, this 2nd day of September, 2011.

	 	 	 	 	 
	 	XPO LOGISTICS, INC.,

 	 
	 	By  	               /s/ Michael R. Welch
 	 
	 	 	Name:  	Michael R. Welch 	 
	 	 	Title:  	Chief Executive
Officer 	 
	 

	 	 	 	 	 
	ATTEST:

 	 
	By  	/s/ John D. Welch
 	 
	 	Name:  	John D. Welch 	 
	 	Title:  	Chief Financial
Officer 	 
	 

21

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