Document:

srcl-ex103_808.htm

Exhibit 10.3

 

Execution Version

 

STERICYCLE, INC.

SECOND AMENDMENT

 

This SECOND AMENDMENT, dated as of November 15, 2018 (this “Amendment”), is entered into by and among STERICYCLE, INC., a Delaware corporation (the “Company”), the Subsidiaries of the Company signatory hereto (collectively, the “Subsidiary Loan Parties”), the Lenders (as defined below) signatory hereto and BANK OF AMERICA, N.A., as administrative agent (in such capacity, the

“Administrative Agent”) under that certain Credit Agreement, dated as of November 17, 2017 (as amended, restated, supplemented or otherwise modified prior to the date hereof, the “Credit Agreement”), among the Company, the financial institutions from time to time party thereto as lenders (the “Lenders”) or as “L/C Issuers”, the Subsidiaries of the Company party thereto as “Designated Borrowers”, and the Administrative Agent. Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to them in the Credit Agreement.

W I T N E S S E T H

WHEREAS, the Company has requested that the Lenders and the Administrative Agent amend the Credit Agreement as set forth herein; and 

WHEREAS, the Administrative Agent and the Lenders have agreed, on the terms and conditions set forth below, to so amend the Credit Agreement.

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, each of the parties hereto hereby agrees as follows:

1. Amendment to Credit Agreement. Subject to the satisfaction of the conditions precedent set forth in Section 2 hereof and effective as of the Effective Date (defined below), Section 7.04(c) of the Credit Agreement is hereby deleted and the following is inserted in lieu thereof: 

(c) the Company or any Subsidiary may consummate any (i) Permitted Acquisition and (ii) Disposition permitted by Section 7.05 (other than Section 7.05(f)).

2. Conditions to Effectiveness. The provisions of Section 1 of this Amendment shall be deemed to have become effective as of November 17, 2017 (the “Effective Date”), but such effectiveness shall be expressly conditioned upon the following:

(a) the Administrative Agent’s receipt of counterparts of this Amendment, duly executed and delivered on behalf of each of the Company, each Subsidiary Loan Party and the Required Lenders; and

(b) unless waived by the Administrative Agent, the Company having paid all fees, charge and disbursements of counsel to the Administrative Agent to the extent invoiced prior to the date hereof.

3. Representations and Warranties. Each Loan Party hereby represents and warrants that:

(a) This Amendment has been duly executed and delivered by each Loan Party that is party hereto. This Amendment constitutes a legal, valid and binding obligation of such Loan Party, enforceable against such Loan Party in accordance with its terms (except, in any case, as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, examinership or similar laws affecting creditors’ rights generally and by principles of equity);

 

 

 

(b) Each Loan Party (i) is duly organized or formed, validly existing and in good standing (if applicable in such Loan Party’s jurisdiction of incorporation or organization) under the Laws of the jurisdiction of its incorporation or organization and (ii) has all requisite power and authority and all requisite governmental licenses, authorizations, consents and approvals to execute, deliver and perform its obligations under this Amendment;

(c) The execution, delivery and performance by each Loan Party of this Amendment have been duly authorized by all necessary corporate or other organizational action, and do not and will not (i) contravene the terms of any of such Person’s Organization Documents; (ii) conflict with or result in any breach or contravention of, or the creation of any Lien under, or require any payment to be made under (A) any Contractual Obligation to which such Person is a party or affecting such Person or the properties of such Person or any of its Subsidiaries or (B) any order, injunction, writ or decree of any Governmental Authority or any arbitral award to which such Person or its property is subject; or (iii) violate any Law;

(d) No approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental Authority or any other Person is necessary or required in connection with the execution, delivery or performance by, or enforcement against, any Loan Party of this Amendment;

(e) After giving effect to this Amendment, no Default has occurred and is continuing or would result from the consummation of the transactions contemplated by this Amendment; and

(f) The representations and warranties contained in Article V of the Credit Agreement and the other Loan Documents are true and correct in all material respects (except to the extent any such representation and warranty is qualified by materiality or reference to Material Adverse Effect, in which case, such representation and warranty shall be true and correct in all respects) on and as of the date hereof, except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects (except to the extent any such representation  and warranty is qualified by materiality or reference to Material Adverse Effect, in which case, such representation and warranty shall be true and correct in all respects) as of such earlier date and except that the representations and warranties contained in subsections (a) and (b) of Section 5.05 thereof shall be deemed to refer to the most recent statements furnished pursuant to clauses (a) and (b), respectively, of Section 6.01 thereof.

4. Governing Law; Jurisdiction; Waiver of Jury Trial; Etc. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS AND DECISIONS (AS OPPOSED TO CONFLICTS OF LAW PROVISIONS) OF THE STATE OF NEW YORK. This Amendment shall be further subject to the provisions of Sections 10.14 and 10.15 of the Credit Agreement.

5. Counterparts; Integration; Effectiveness. This Amendment may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Amendment, together with the other Loan Documents, constitutes the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof. Delivery of an executed counterpart of a signature page of this Amendment by telecopy or other electronic imaging means shall be effective as delivery of a manually executed counterpart of this Amendment.

6. Severability. If any provision of this Amendment is held to be illegal, invalid or unenforceable, (a) the legality, validity and enforceability of the remaining provisions of this Amendment shall not be affected or impaired thereby and (b) the parties shall endeavor in good faith negotiations to replace the 

 

 

illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

7. Effect. Upon the effectiveness of this Amendment, each reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof” or words of like import shall mean and be a reference to the Credit Agreement as modified hereby and each reference in the other Loan Documents to the Credit Agreement, “thereunder,” “thereof,” or words of like import shall mean and be a reference to the Credit Agreement as modified hereby. This Amendment shall constitute a Loan Document for purposes of the Credit Agreement.

8. Reaffirmation. Except as specifically modified by this Amendment, the Credit Agreement shall remain in full force and effect and is hereby ratified and confirmed.

9. Guarantors. Each Guarantor hereby consents to this Amendment and reaffirms the terms and conditions of each Guaranty and each other Loan Document executed by it and acknowledges and agrees that each and every such Guaranty and other Loan Document executed by such Guarantor in connection with the Credit Agreement remains in full force and effect and is hereby reaffirmed, ratified and confirmed.

 

[Remainder of this page intentionally left blank; signature pages follow]

 

 

 

 

IN WITNESS WHEREOF, each of the undersigned has caused this Amendment to be executed and delivered by a duly authorized officer on the date first above written.

 

BANK OF AMERICA, N.A.,
as Administrative Agent 

 

By: /s/ Ronaldo Naval

Name: Ronaldo Naval

Title:   Vice President

 

BANK OF AMERICA, N.A., as a Lender, an L/C Issuer and Swing Line Lender

By:_________________ 

Name:

Title: 

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

IN WITNESS WHEREOF, each of the undersigned has caused this Amendment to be executed and delivered by a duly authorized officer on the date first above written.

 

BANK OF AMERICA, N.A.,
as Administrative Agent 

 

By:_________________ 

Name: 

Title: 

 

BANK OF AMERICA, N.A., as a Lender, an L/C Issuer and Swing Line Lender

By: /s/ Matthew N. Walt

Name: Matthew N. Walt 

Title:   Director

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

		
		
	

STERICYCLE, INC., as the Company

	
 

	
By:      /s/ Daniel Ginnetti
	
	
Name: Daniel Ginnetti
	
	
Title:   Executive Vice President and Chief Financial Officer
	
	
 

	
STERICYCLE INTERNATIONAL, LTD., as a Designated Borrower and a Guarantor

	
 
	
	
By:      /s/ Daniel Ginnetti
	
	
Name: Daniel Ginnetti
	
	
Title:   Director
	
	
 

	
SRCL LIMITED, as a Designated Borrower and a Guarantor

	
 
	
	
By:      /s/ Daniel Ginnetti
	
	
Name: Daniel Ginnetti
	
	
Title: Director
	
	
 

	
STERICYCLE EUROPE S.à.r.l., as a Designated Borrower and a Guarantor

	
 
	
	
By:      /s/ Daniel Ginnetti
	
	
Name: Daniel Ginnetti
	
	
Title:   A manager
	
	
 

	
STERICYCLE, ULC, as a Designated Borrower and a Guarantor 

	
 
	
	
By:      /s/ Daniel Ginnetti
	
	
Name: Daniel Ginnetti
	
	
Title:   Executed Vice President and Chief Financial Officer
	
	
 

	
STERICYCLE INTERNATIONAL HOLDINGS LIMITED, as a Designated Borrower and a Guarantor

	
 
	
	
By:      /s/ Daniel Ginnetti
	
	
Name: Daniel Ginnetti
	
	
Title:   Director
	

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

STERICYCLE ENVIRONMENTAL SOLUTIONS, INC., as a Guarantor

 

	
	
By:      /s/ Daniel Ginnetti

	
Name: Daniel Ginnetti

	
Title:   Vice President, Secretary and Treasurer

 

SHRED-IT USA LLC, as a Guarantor

 

	
	
By:      /s/ Daniel Ginnetti

	
Name: Daniel Ginnetti

	
Title:   Vice President, Secretary and Treasurer

 

STERICYCLE COMMUNICATION SOLUTIONS, INC., as a Guarantor

 

	
	
By:      /s/ Daniel Ginnetti

	
Name: Daniel Ginnetti

	
Title:   Vice President, Secretary and Treasurer

 

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

STERICYCLE ESPAÑA, S.L. (Sociedad Unipersonal), 

as a Guarantor

 

	
	
By:      /s/ Franciscus J.M. Ten Brink 

	
Name:Franciscus J.M. Ten Brink

	
Title:Administrador Único

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

		
		
	
HSBC BANK USA, NATIONAL ASSOCIATION, as a Lender 

	
 
	
	
By:     /s/ Andrew Bicker
	
	
Name:Andrew Bicker
	
	
Title:Director
	

 

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

		
		
	
HSBC BANK PLC, as a Lender 

	
 
	
	
By:      /s/ Giovanna Padua
	
	
Name:Giovanna Padua
	
	
Title:Relationship Banker
	

 

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

		
		
	
JPMORGAN CHASE BANK, N.A., as a Lender 

	
 
	
	
By:      /s/ Krys Szremski
	
	
Name:Krys Szremski
	
	
Title:Executive Director
	

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

		
		
	
MUFG BANK, LTD., f/k/a THE BANK OF TOKYO-MITSUBISHI UFJ, LTD., as a Lender 

	
 
	
	
By:      /s/ Maria F. Maia
	
	
Name:Maria F. Maia
	
	
Title:Director
	

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

		
		
	
SUMITOMO MITSUI BANKING CORPORATION, as a Lender 

	
 
	
	
By:      /s/ James D. Weinstein
	
	
Name:James D. Weinstein
	
	
Title:Managing Director
	

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

		
		
	
WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender 

	
 
	
 

	
By:      /s/ Sara Barton
	
	
Name:Sara Barton
	
	
Title:Vice President 
	

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

		
		
	
U.S. BANK NATIONAL ASSOCIATION, as a Lender 

	
 
	
	
By:      /s/ James N. DeVries
	
	
Name:James N. DeVries
	
	
Title:Senior Vice President 
	

 

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

		
		
	
BMO HARRIS BANK N.A., as a Lender 

	
 
	
	
By:      /s/ Brian J. Doyle
	
	
Name:Brian J. Doyle
	
	
Title:Vice President
	

 

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

		
		
	
BMO HARRIS FINANCING INC., as a Lender 

	
 
	
	
By:      /s/ Brian J. Doyle
	
	
Name:Brian J. Doyle
	
	
Title:Vice President
	

 

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

		
		
	
COMPASS BANK, as a Lender 

	
 
	
	
By:      /s/ Gilberto Gonzalez
	
	
Name:Gilberto Gonzalez
	
	
Title:S.V.P.
	

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

		
		
	
UNICREDIT BANK AG, NEW YORK BRANCH, as a Lender 

	
 
	
 

	
By:      /s/ Mathias Eichwald
	
	
Name:Mathias Eichwald
	
	
Title:Director
	

 

	
	
By:      /s/ Tommaso Maiocchi

	
Name:Tommaso Maiocchi

	
Title:Associate Director

 

 

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

		
		
	
GOLDMAN SACHS BANK USA, as a Lender 

	
 
	
	
 

By:      /s/ Mahesh Mohan
	
	
Name:Mahesh Mohan
	

Title:Authorized Signatory

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

		
		
	
CITIBANK, N.A., as a Lender 

	
 
	
	
 

By:      /s/ Michael Chen
	
	
Name:Michael Chen

Title:Authorized Signatory

 

 

 
	

	
	CITIZENS BANK, N.A., as a Lender By:      /s/ Matthew PossanzaName:Matthew PossanzaTitle:Officer
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

 

		
	
PNC BANK, NATIONAL ASSOCIATION, as a Lender 

	
 
	
	
 

By:      /s/ Bridget Anderson 
	
	
Name:Bridget Anderson 
	
	
Title:Assistant Vice President 
	

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

 

 

		
	
SANTANDER BANK, N.A., as a Lender 

	
 
	
 

	
By:      /s/ Andres Barbosa 
	
	
Name:Andres Barbosa
	
	
Title:Executive Director 
	

 

	
	
By:      /s/ Carolina Gutierrez

	
Name:Carolina Gutierrez

	
Title:Vice President 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Page

 

 

 

 

 

		
	
THE NORTHERN TRUST COMPANY, as a Lender 

	
 

By:      /s/ Brittany Mondane
	
 

	
Name:  Brittany Mondane

Title:    Vice President
	
 

	
 
	
 

 

Stericycle, Inc.

Second Amendment to Credit Agreement

Signature Pagesrcl-ex1046_552.htm

Exhibit 10.46

 

Participants Eligible for Executive Severance and CIC Plan

Draft 1-2-19

Stock Option Award Agreement

 

(Nonstatutory Stock Option Under 

Stericycle, Inc. 2017 Long-Term Incentive Plan)

 

 

Stericycle, Inc., a Delaware corporation (the Company), grants to the following employee of the Company or one of its Subsidiaries (Participant), as of the following grant date (the Grant Date), a nonstatutory stock option (the Option) to purchase the following number of shares of Common Stock (the Option Shares), at the following purchase price per share (the Exercise Price), exercisable in installments in accordance with the following and the other terms and conditions of this Award Agreement:

		
	
Participant:
	
%%FIRST_NAME%-% %%LAST_NAME%-%

	
Grant Date:
	
%%OPTION_DATE,’Month DD, YYYY’%-%

	
Number of Option Shares:
	
%%TOTAL_SHARES_GRANTED,’999,999,999’%-%

	
Exercise Price Per Share:
	
$$OPTION_PRICE,’999,999,999.9999’%-%

	
Vesting Schedule:
	
[Insert Applicable Vesting Schedule]

	
Latest Expiration Date:
	
%%EXPIRE_DATE_PERIOD8,’Month DD, YYYY’%-%

 

Terms of Option

1.Plan. The Option has been granted under the Stericycle, Inc. 2017 Long-Term Incentive Plan (the Plan), which is incorporated into this Award Agreement by reference.  Unless otherwise provided herein, all capitalized terms used in this Award Agreement without being defined have the same meanings attributed to them in the Plan.

2.Vesting/Exercisability.  The Option shall vest and shall become exercisable with respect to the number of Option Shares subject thereto in accordance with the Vesting Schedule set forth above provided that Participant’s Termination Date has not occurred as of the applicable vesting date.  Any portion of the Option that is not vested and exercisable as of Participant’s Termination Date shall be forfeited and Participant shall have no further rights with respect thereto.  In no event shall the Option continue to vest after Participant’s Termination Date.  Notwithstanding the foregoing: 

(a)The Option shall vest and shall become exercisable as to all Option Shares then subject to the Option upon Participant’s Termination Date if Participant’s Termination Date occurs on account of  death.  

(b)The Option is subject to forfeiture and automatic cancellation as provided in the Employee Covenant Agreement referred to in Paragraph 7 of this Award Agreement . In addition, Participant may be required to repay the Company the net 

 

 

proceeds from the sale of any Option Shares as also provided in the Employee Covenant Agreement.

(c)If (i) a Change of Control occurs prior to the date on which the Option is fully vested, (ii) on or within 12 months following the Change of Control (the Protected Period), Participant’s Termination Date occurs as a result of a Qualifying Termination (as defined in subparagraph (d)), and (iii) the Release Requirements (as defined in subparagraph (d)) are satisfied as of the date that is 60 days following Participant’s Termination Date, then the Option shall become fully vested with respect to all of the Option Shares subject thereto as of the Termination Date (to the extent not already vested).

(d)For purposes of this Award Agreement :

(i)A Qualifying Termination means the occurrence of Participant’s Termination Date by reason of (I) termination by the Company or a Subsidiary without Cause or (II) termination by Participant for Good Reason (as defined below).

(ii)Participant’s Termination Date shall be considered to have terminated for Good Reason if (A) without Participant’s consent, one or more of the following actions or omissions occurs: (I) a material reduction in Participant’s base salary or bonus opportunity as in effect immediately prior to the Change of Control, (II) a material reduction in the level of Participant’s incentive plan participation (without replacement of substantially equal value) as in effect immediately prior to the Change of Control, (III) the elimination (without replacement) of a material benefit provided to Participant immediately prior to the Change of Control, (IV) Participant is required to be based at any office or location more than 50 miles from Participant’s office or location in effect immediately prior to the Change of Control, (V) any material diminution in Participant’s authority, duties or responsibilities as in effect immediately prior to the Change of Control, or (VI) any material breach of this Award Agreement or the Plan by the Company or the Committee, (B) Participant notifies the Company in writing of the event constituting Good Reason within 90 days after the occurrence of such event and within the Protected Period, (C) the Company has not cured the event constituting Good Reason within 30 days following receipt of the notice from Participant, and (D) Participant terminates employment within 5 days following expiration of the cure period.  For the avoidance of doubt, a delay in the delivery of a notice of Good Reason or in Participant’s termination following the lapse of the cure period shall constitute a waiver of Participant’s ability to terminate for Good Reason under this Award Agreement. 

(iii)The Release Requirements will be satisfied as of any date provided that, as of such date, Participant (A) has timely delivered to the Company a general waiver and release of claims in favor of the Company and related parties (the Release) in such form provided by the Company in its sole discretion and with such terms and conditions (which shall include, but are not 

2

 

limited to, non-competition, non-solicitation, confidentiality, and other restrictive covenants, as well as the events that shall result in the forfeiture, recoupment, and/or claw-back of the benefits provided under this Award Agreement and the Plan) as are reasonably acceptable to the Company, (B) Participant does not revoke the Release, and (C) the revocation period related to such Release has expired.

3.Expiration.  The Option shall expire and shall no longer be exercisable after the Expiration Date as defined in the Plan (which generally provides that if the Participant’s Termination Date occurs for any reason other than death, Disability, or Cause, the Expiration Date will be the 90th day after the Termination Date) but in no event later than the Latest Expiration Date as set forth above.  Notwithstanding the definition of Expiration Date under the Plan, however, if Participant’s Termination Date occurs on account of Retirement (as defined below), the Option shall remain exercisable until the earlier of the 12 month anniversary of Participant’s Termination Date or the Latest Expiration Date set forth above.  For purposes of this Agreement, Participant’s Termination Date shall be considered to have occurred on account of “Retirement” if his Termination Date occurs on or after the date that (a) he has attained age 65 or (b) he has attained 55 and completed at least 10 years of continuous service with the Company and its affiliates and provided that his Termination Date does not occur for any other reason other than Retirement (including termination for Cause).

4.Manner of Exercise. The Option may be exercised in respect of a whole number of Option Shares (and only in respect of a whole number) by written notice of exercise to the Committee (or its designee) at the Company’s principal executive offices (which are currently located at 28161 North Keith Drive, Lake Forest, Illinois 60045), which is received prior to the Option’s Expiration Date, together with (a) full payment of the Exercise Price of the Option Shares in respect of which the Option is exercised and (b) full payment of an amount equal to the Company’s federal, state and local withholding tax obligation, if any, in connection with the Option’s exercise.

In addition, the exercise of the Option shall be subject to any procedures and policies in effect at the time of exercise that the Committee has adopted to administer the Plan.

5.Manner of Payment. Subject to the following provisions, the full Exercise Price for Option Shares purchased upon the exercise of the Option shall be paid at the time of such exercise (except that, in the case of an exercise arrangement approved by the Committee and described below, payment may be made as soon as practicable after the exercise).  

Participant’s payment of the Exercise Price of the Option Shares in respect of which the Option is exercised shall be satisfied through the surrender of shares of Common Stock (or other amounts) to which Participant is otherwise entitled under the Plan (net withholding) unless Participant elects to pay such Exercise Price in cash or by tendering (including by way of a net exercise), by either actual delivery of shares or by attestation, shares of Common Stock acceptable to the Committee, and valued at Fair Market Value as of the day of exercise, or in any combination thereof; provided, however, that shares of Common Stock may not be used to pay any portion of the Exercise Price unless the holder thereof has good title, free and clear of all liens and encumbrances. 

3

 

Participant may also elect to pay the Exercise Price (and any applicable withholding taxes) upon the exercise of an Option by irrevocably authorizing a third party approved by the Committee to sell shares of Common Stock (or a sufficient portion of the shares) acquired upon exercise of the Option and remit to the Company a sufficient portion of the sale proceeds to pay the entire Exercise Price and any tax withholding resulting from such exercise.

Tax withholding obligations shall also be subject to Paragraph 6 of this Agreement.

 

6.Withholding.  This Award and all payments hereunder are subject to withholding of all applicable taxes. Any withholding obligations relating to this Award shall be satisfied through the surrender of shares of Common Stock (or other amounts) to which Participant is otherwise entitled under the Plan (net withholding) unless Participant elects to satisfy such withholding (a) through cash payment by Participant, (b) through the surrender of shares of Common Stock that Participant already owns, or (c) in accordance with Paragraph 5 hereof.  Notwithstanding the foregoing, previously-owned Common Stock that has been held by Participant or Common Stock to which Participant is entitled under the Plan may only be used to satisfy the minimum tax withholding required by applicable law (or other rates that will not have a negative accounting impact).

7.Employee Covenant Agreement. This Award Agreement and the grant of the Option are subject to Participant’s acceptance of and agreement to be bound by the Employee Covenant Agreement which has been provided or made available to Participant with this Award Agreement. The Company would not have granted the Option to Participant without Participant’s acceptance of and agreement to be bound by the Employee Covenant Agreement.

8.Transferability. The Option may not be transferred, assigned or pledged (whether by operation of law or otherwise), except (i) as provided by will or the applicable laws of intestacy or (ii) in accordance with Section 9.5 of the Plan. The Option shall not be subject to execution, attachment or similar process.

9.Interpretation/Administration. This Award Agreement is subject to the terms of the Plan, as the Plan may be amended, but except as required by applicable law, no amendment of the Plan after the Grant Date shall adversely affect Participant’s rights in respect of the Option without Participant’s consent.

If there is a conflict or inconsistency between this Award Agreement and the Plan, the terms of the Plan shall control. The Committee’s interpretation of this Award Agreement and the Plan shall be final and binding.

The authority to manage and control the operation and administration of this Award shall be vested in the Committee, and the Committee shall have all powers with respect to the Award and this Award Agreement as it has with respect to the Plan.  Any interpretation of this Award Agreement by the Committee and any decision made by it with respect to the Award or this Award Agreement is final and binding on all persons.

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10.No Employment Rights. Nothing in this Award Agreement shall be considered to confer on Participant any right to continue in the employ of the Company or a Subsidiary or to limit the right of the Company or a Subsidiary to terminate Participant’s employment.

11.No Stockholder Rights. Participant shall not have any rights as a stockholder of the Company in respect of any of the Option Shares unless and until shares of Common Stock are issued to Participant following the exercise of the Option.

12.Governing Law. This Award Agreement shall be governed in accordance with the laws of the State of Illinois.

13.Binding Effect. This Award Agreement shall be binding on the Company and Participant and on Participant’s heirs, legatees and legal representatives.

14.Adjustment.  The Option, the number and kind of shares subject to the Option and the Exercise Price per share shall be subject to adjustment by the Committee in accordance with the terms of the Plan.

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