Document:

EX-10.1

 

Exhibit 10.1

	 	 	 	 	 	 
	 	 	 	 	 	A. SCHULMAN, INC.
	 	 	 	 	 	2006 INCENTIVE PLAN
	 	 	 	 	 	 
	 	 	 	 	 	INSTRUCTIONS FOR COMPLETING TIME-BASED RESTRICTED STOCK AWARD
AGREEMENT FOR EMPLOYEES
	 	 	 	 	 	 
	 	 	 	 	 	Code Sheet
	 	 	 	 	 	 
	 	The following codes are used in this Award Agreement and should be replaced using your P.C.’s
“Replace” function (see instructions accompanying this form).
	 	 	 	 	 	 
	 	 	 	VTA
	 	Grantee’s name (all capital letters)
	 	 	 	 	 	 
	 	 	 	VTB
	 	Grant Date (all capital letters)
	 	 	 	 	 	 
	 	 	 	Vtb
	 	Grant Date (initial capital letters only)
	 	 	 	 	 	 
	 	 	 	Vtc
	 	Person to contact for more information
	 	 	 	 	 	 
	 	 	 	Vtd
	 	Contact’s telephone number, including area code
	 	 	 	 	 	 
	 	 	 	Vte
	 	Date that is 30 days after the Grant Date (initial capital letters only)
	 	 	 	 	 	 
	 	 	 	Vtf
	 	Number of shares of Restricted
Stock granted (insert only the number in Arabic numerals)
	 	 	 	 	 	 
	 	 	 	Vtg
	 	Contact’s street address
	 	 	 	 	 	 
	 	 	 	Vth
	 	Contact’s city, state and zip code
	 	 	 	 	 	 
	 	 	 	Vti
	 	Calendar year in which grant is made (e.g., 2006)
	 	 	 	 	 	 
	 	 	 	Vtq
	 	Grantee’s name (initial capital letters only)
	 	 	 	 	 	 
	 	 	 	 	 	 

1

 

A. SCHULMAN, INC.

2006 INCENTIVE PLAN

TIME-BASED RESTRICTED STOCK AWARD AGREEMENT ISSUED TO

VTA on VTB

A. Schulman, Inc. (“Company”) and its shareholders believe that their business interests are best
served by extending to you an opportunity to earn additional compensation based on the growth of
the Company’s business. To this end, the Company’s shareholders adopted the A. Schulman, Inc. 2006
Incentive Plan (“Plan”) as a means through which employees like you may share in the Company’s
success. If you satisfy the conditions described in this Award Agreement and the Plan, you will
have earned the shares of Restricted Stock granted through this Award Agreement.

This Award Agreement describes many features of your Award and the conditions you must meet before
you may receive the value associated with your Award. To ensure you fully understand these terms
and conditions, you should:

	 	•	 	Read the Plan carefully to ensure you understand how the Plan works;
	 
	 	•	 	Read this Award Agreement carefully to ensure you understand the nature of your Award
and what you must do to earn it; and
	 
	 	•	 	Contact Vtc at Vtd if you have any questions about your Award.

Also, no later than Vte, you must return a signed copy of the Award Agreement to:

Vtc

A. Schulman, Inc.

Vtg

Vth

If you do not do this, your Award will be forfeited and you will not be entitled to receive
anything on account of this Award.

Section 409A of the Internal Revenue Code (“Section 409A”) imposes substantial penalties on persons
who receive some forms of deferred compensation. Your Award has been designed to avoid these
penalties. However, because the Internal Revenue Service has not yet issued final rules fully
defining the effect of Section 409A, it may be necessary to revise your Award Agreement if you are
to avoid these penalties. As a condition of accepting this Award, you must agree to accept those
revisions, without any further consideration, even if those revisions change the terms of your
Award and reduce its value or potential value.

 

 

Nature of Your Award

You have been granted Restricted Stock. If you satisfy the conditions described in this Award
Agreement, the restrictions imposed on your Restricted Stock will be removed and you will own the
shares. These and other conditions affecting your Restricted Stock are described in this Award
Agreement and the Plan, both of which you should read carefully.

No later than Vte you must return a signed copy of this Award Agreement to:

Vtc

A. Schulman, Inc.

Vtg

Vth

If you do not do this, your Award will be forfeited and you will not be entitled to receive
anything on account of this Award.

Grant Date: Your shares of Restricted Stock are issued on Vtb.

This is the date you begin to earn your Award.

Number of Shares of Restricted Stock: You have been granted Vtf shares of Restricted Stock. The
conditions that you must meet before you actually own these shares are discussed below in the
section titled “When Your Award Will Be Settled.”

When Your Award Will Be Settled

Until the conditions described in this Award Agreement are met, your Restricted Stock will be held
in escrow. On the Settlement Date, these shares either will be distributed to you, free of any
restrictions, or forfeited, depending on whether or not you satisfy the conditions described in
this Award Agreement and in the Plan.

Normal Settlement Date: Normally, restrictions on 33 1/3 % of your Restricted Stock will be
removed on each anniversary of the Grant Date if you are an employee of the Company on that date.

However, your Restricted Stock may be settled earlier in the circumstances described in the next
section.

How Your Restricted Stock Might Be Settled Earlier Than the Normal Settlement Date: Your
Restricted Stock will be immediately settled if there is a “change in control” (as defined in the
Plan).

How Your Termination of Employment Will Affect Your Restricted Stock: You may forfeit your
Restricted Stock if you terminate employment before the Normal Settlement Date, although this will
depend on why you terminate.

2

 

	 	•	 	If you terminate because of [1] death or [2] disability (as defined in the
Plan), your Restricted Stock will fully vest on your termination date;
	 
	 	•	 	If you terminate because of retirement (as defined in the Plan) and if the
Committee agrees to treat your termination as a “retirement,” a prorata portion of
your Restricted Stock will vest on your retirement date equal to:

	 	 	 	 	 	 	 	 	 
	 

	 	Number of

unvested shares of              X
	 	 
	 	the number of whole months between Vtb

and your retirement date

	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	Restricted Stock

at retirement date
	 	 	 	the number of whole months between Vtb

and the Normal Settlement Date	 	 

	 	•	 	If you terminate under any other circumstances, all of the Restricted Stock
granted through this Award Agreement will be forfeited on your termination date.

Settling Your Award

If all applicable conditions have been met, your Restricted Stock will be settled automatically.

Other Rules Affecting Your Award

Rights During the Restriction Period: During the Restriction Period (as defined in the Plan) (and
even though these shares are held in escrow until they are settled), you may exercise any voting
rights associated with your Restricted Stock. You also will be entitled to receive any dividends
or other distributions paid on these shares, although these dividends also will be held in escrow
until the Award is settled and distributed to you (or forfeited) depending on whether or not you
have met the conditions described in this Award Agreement and in the Plan.

Beneficiary Designation: You may name a beneficiary or beneficiaries to receive any Restricted
Stock that is settled after you die. This may be done only on the attached Beneficiary Designation
Form and by following the rules described in that form. This form need not be completed now and is
not required as a condition of receiving your Award. If you die without completing a Beneficiary
Designation Form or if you do not complete that form correctly, your beneficiary will be your
surviving spouse or, if you do not have a surviving spouse, your estate.

Tax Withholding: Income taxes must be withheld when your Award is settled. These taxes may be
paid in one of several ways. They are:

	 	•	 	By the Company withholding this amount from other amounts owed to you (e.g., from
your salary);
	 
	 	•	 	By giving the Company a check (payable to “A. Schulman, Inc.”) in an amount equal to
the taxes that must be withheld; or
	 
	 	•	 	By having the Company withhold a portion of the shares that otherwise would be
distributed. The number of shares withheld will have a fair market value equal to the
taxes that must be withheld.

3

 

You must choose the approach you prefer before the shares are transferred to you, although the
Company may reject your preferred method for any reason (or for no reason). If this happens, the
Company will specify (from among the alternatives just listed) how these taxes are to be paid.

If you do not choose a method within 30 days of the Settlement Date, the Company will withhold
either through payroll practices or a portion of the shares that otherwise would be distributed.
The number of shares withheld will have a fair market value equal to the taxes that must be
withheld and the balance of the shares will be distributed to you.

Transferring Your Restricted Stock: Normally, your Restricted Stock may not be transferred to
another person. However, you may complete a Beneficiary Designation Form to name the person to
receive any Restricted Stock that is settled after you die. Also, the Committee may allow you to
place your Restricted Stock into a trust established for your benefit or the benefit of your
family. Contact Vtc at the address or number given below if you are interested in doing this.

Governing Law: This Award Agreement will be construed in accordance with and governed by the laws
(other than laws governing conflicts of laws) of the State of Ohio, except to the extent that the
Delaware General Corporation Law is mandatorily applicable.

Other Agreements: Also, your Restricted Stock will be subject to the terms of any other written
agreements between you and the Company to the extent that those other agreements do not directly
conflict with the terms of the Plan or this Award Agreement.

Adjustments to Your Restricted Stock: Your Award will be adjusted, if appropriate, to reflect any
change to the Company’s capital structure (e.g., the number of your Restricted Stock will be
adjusted to reflect a stock split).

Other Rules: Your Restricted Stock also is subject to more rules described in the Plan. You
should read the Plan carefully to ensure you fully understand all the terms and conditions of this
Award.

*****

You may contact Vtc at the address or number given below if you have any questions about your Award
or this Award Agreement.

*****

Your Acknowledgment of Award Conditions

Note: You must sign and return a copy of this Award Agreement to Vtc at the address given below no
later than Vte.

By signing below, I acknowledge and agree that:

	 	•	 	A copy of the Plan has been made available to me;

4

 

	 	•	 	I understand and accept the conditions placed on my Award and understand what I must
do to earn my Award;
	 
	 	•	 	I will consent (in my own behalf and in behalf of my beneficiaries and without any
further consideration) to any change to my Award or this Award Agreement to avoid
paying penalties under Section 409A of the Internal Revenue Code, even if those changes
affect the terms of my Award and reduce its value or potential value; and
	 
	 	•	 	If I do not return a signed copy of this Award Agreement to the address shown below
by Vte, my Award will be forfeited and I will not be entitled to receive anything on
account of this Award.

	 	 	 	 	 	 	 	 	 	 	 
	Vtq	 	 	 	A. SCHULMAN, INC.	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	(signature)
	 	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	Date signed:	 	 	 	Date signed:	 	 	 	 
	 

	 	 
	 	 	 	 	 	 	 	 

A signed copy of this form must be sent to the following address no later than Vte:

Vtc

A. Schulman, Inc.

Vtg

Vth

Vtd

After it is received, the A. Schulman, Inc. 2006 Incentive Plan Committee will acknowledge receipt
of your signed Award Agreement.

*****

5

 

Committee’s Acknowledgment of Receipt

A signed copy of this Award Agreement was received on                     .

By:
                                        
                    

Vtq:

___ Has complied with the conditions imposed on the grant and the Award and the Award
remains in effect; or

___ Has not complied with the conditions imposed on the grant and the Award and the Award
is forfeited because

 

 

.

describe deficiency

A. Schulman, Inc. 2006 Incentive Plan Committee

	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

	 	 
	Date:
	 	 	 	 
	 

	 	 	 	 

Note: Send a copy of this completed form to Vtq and keep a copy as part of the Plan’s permanent
records.

6

 

A. SCHULMAN, INC.

2006 INCENTIVE PLAN

BENEFICIARY DESIGNATION FORM

RELATING TO TIME-BASED RESTRICTED STOCK ISSUED TO

VTA ON VTB

Instructions for Completing This Form

You may use this form to [1] name the person you want to receive any amount due under the A.
Schulman, Inc. 2006 Incentive Plan after your death or [2] change the person who will receive these
benefits.

There are several things you should know before you complete this form.

First, if you do not elect another beneficiary, any amount due to you under the Plan when you die
will be paid to your surviving spouse or, if you have no surviving spouse, to your estate.

Second, your election will not be effective (and will not be implemented) unless you complete all
applicable portions of this form and return it to Vtc at the address given below.

Third, all elections will remain in effect until they are changed (or until all death benefits are
paid).

Fourth, if you designate your spouse as your beneficiary but are subsequently divorced from that
person (or your marriage is annulled), your beneficiary designation will be revoked automatically.

Fifth, if you have any questions about this form or if you need additional copies of this form,
please contact Vtc at Vtd or at the address or number given below.

1.00 Designation of Beneficiary

1.01 Primary Beneficiary:

I designate the following persons as my primary beneficiary or beneficiaries to receive any amount
due after my death under the terms of the Award Agreement described at the top of this form. This
benefit will be paid, in the proportion specified, to:

	 	 	 	 	 	 	 	 	 
	 

	 	___% to
	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 

 

 

	 	 	 	 	 	 	 	 	 
	 

	 	___% to	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	___% to	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	___% to	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 

1.02 Contingent Beneficiary:

If one or more of my primary beneficiaries die before I die, I direct that any amount due after my
death under the terms of the Award Agreement described at the top of this form:

___ Be paid to my other named primary beneficiaries in proportion to the allocation given
above (ignoring the interest allocated to the deceased primary beneficiary); or

___ Be distributed, in the proportion specified, among the following contingent
beneficiaries:

	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	___% to	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	___% to	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	___% to	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	___% to	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 

****

2

 

Elections made on this form will be effective only after this form is received by Vtc and only if
it is fully and properly completed and signed.

Vtq

	 	 	 	 	 
	Date of Birth:

	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Address:
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 	 	 

Sign and return this form to Vtc at the address given below.

	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	Date

	 	 	 	Signature	 	 

Return this signed form to Vtc at the following address:

Vtc

A. Schulman, Inc.

Vtg

Vth

Vtd

Received on:
                                        

	 	 	 	 	 
	 

	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 

3

 

A. SCHULMAN, INC.

2006 INCENTIVE PLAN

INSTRUCTIONS FOR COMPLETING SECTION 83(b) ELECTION FORM

You may make a Section 83(b) Election by completing the Section 83(b) Election Form. To do this:

	 	•	 	You must make the election by completing the attached form;
	 
	 	•	 	Within 30 days of Vtb, you must send a copy of this form to the Internal Revenue
Service Center at which you normally file your federal income tax return;
	 
	 	•	 	You also must send a copy of this form to:

Vtc

A. Schulman, Inc.

Vtg

Vth

 

 

A. SCHULMAN, INC.

2006 INCENTIVE PLAN

ELECTION UNDER SECTION 83(b)

OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED

The undersigned taxpayer hereby elects, pursuant to Section 83(b) of the Internal Revenue Code, to
include in taxpayer’s gross income for the current taxable year, the amount of any income that may
be taxable to taxpayer in connection with taxpayer’s receipt of the property described below:

	1.	 	The name, address, taxpayer identification number and taxable year of the undersigned
are as follows:
	 
	 	 	NAME OF TAXPAYER:           Vtq

	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	ADDRESS:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 

	 	 	IDENTIFICATION NUMBER OF TAXPAYER:
                                        
                    
	 
	 	 	TAXABLE YEAR: Calendar year Vti
	 
	2.	 	The property with respect to which the election is made is:
	 
	 	 	Vtf shares of the Common Stock of A. Schulman, Inc., a Delaware corporation
(“Company”).
	 
	3.	 	The date on which the property was transferred is: Vtb.
	 
	4.	 	The property is subject to the following restrictions:
	 
	 	 	Forfeiture of:
	 
	 	 	___ shares in favor of the Company if employment terminates before
                                        
.
	 
	 	 	___ shares in favor of the Company if employment terminates before
                                        
.
	 
	 	 	___ shares in favor of the Company if employment terminates before
                                        
.
	 
	5.	 	The fair market value at the time of transfer, determined without regard to any
restriction other than a restriction which by its terms will never lapse, of such
property is: $                    .

2

 

	6.	 	The amount (if any) paid for such property: $00.00.

The undersigned has submitted a copy of this statement to A. Schulman, Inc.. The transferee of
such property is the person performing the services in connection with the transfer of said
property.

The undersigned understands that the foregoing election may not be revoked except with the consent
of the Commissioner.

	 	 	 	 	 	 	 
	Dated:
	 	 	 	 	 	 
	 

	 	 
	 	 	 	 
	 

	 	 	 	 	 	Vtq

3EX-10.2

 

Exhibit 10.2

A. SCHULMAN, INC.

2006 INCENTIVE PLAN

INSTRUCTIONS FOR COMPLETING AMENDED AND RESTATED

PERFORMANCE-BASED RESTRICTED STOCK AND PERFORMANCE SHARE

AWARD AGREEMENT FOR EMPLOYEES

Code Sheet

The following codes are used in this Award Agreement and should be replaced using your P.C.’s
“Replace” function (see instructions accompanying this form).

	 	 	 	 	 
	 

	 	VTA
	 	Grantee’s name (all capital letters)
	 
	 	 	 	 
	 

	 	VTB
	 	Grant Date (all capital letters)
	 
	 	 	 	 
	 

	 	Vtb
	 	Grant Date (initial capital letters only)
	 
	 	 	 	 
	 

	 	Vtc
	 	Person to contact for more information
	 
	 	 	 	 
	 

	 	Vtd
	 	Contact’s telephone number, including area code
	 
	 	 	 	 
	 

	 	Vte
	 	Date that is 30 days after the Grant Date (initial capital letters only)
	 
	 	 	 	 
	 

	 	Vtf
	 	Number of shares of Restricted Stock granted (insert only the number in Arabic
numerals)
	 
	 	 	 	 
	 

	 	Vtg
	 	Number of Performance Shares granted (insert only the number in Arabic
numerals)
	 
	 	 	 	 
	 

	 	Vtg
	 	Contact’s street address
	 
	 	 	 	 
	 

	 	Vth
	 	Contact’s city, state and zip code
	 
	 	 	 	 
	 

	 	Vti
	 	Calendar year in which grant is made (e.g., 2006)
	 
	 	 	 	 
	 

	 	Vtq
	 	Grantee’s name (initial capital letters only)

1

 

A. SCHULMAN, INC.

2006 INCENTIVE PLAN

AMENDED AND RESTATED

PERFORMANCE-BASED RESTRICTED STOCK AND PERFORMANCE SHARE

AWARD AGREEMENT ISSUED TO

VTA on VTB

A. Schulman, Inc. (“Company”) and its shareholders believe that their business interests are best
served by extending to you an opportunity to earn additional compensation based on the growth of
the Company’s business. To this end, the Company’s shareholders adopted the A. Schulman, Inc. 2006
Incentive Plan (“Plan”) as a means through which employees like you may share in the Company’s
success. You have been granted Restricted Stock and Performance Shares (collectively, the “Award”)
under the Plan.

This Award Agreement describes many features of your Award and the conditions you must meet before
you may receive the value associated with your Award. To ensure you fully understand these terms
and conditions, you should:

	 	•	 	Read the Plan carefully to ensure you understand how the Plan works;
	 
	 	•	 	Read this Award Agreement carefully to ensure you understand the nature of your Award
and what you must do to earn it; and
	 
	 	•	 	Contact Vtc at Vtd if you have any questions about your Award.

Also, no later than Vte, you must return a signed copy of the Award Agreement to:

Vtc

A. Schulman, Inc.

Vtg

Vth

If you do not do this, your Award will be forfeited and you will not be entitled to receive
anything on account of this Award.

Section 409A of the Internal Revenue Code (“Section 409A”) imposes substantial penalties on persons
who receive some forms of deferred compensation. Your Award has been designed to avoid these
penalties. However, it may be necessary to revise your Award Agreement if you are to avoid these
penalties. As a condition of accepting this Award, you must agree to accept those revisions,
without any further consideration, even if those revisions change the terms of your Award and
reduce its value or potential value.

Nature of Your Award

The terms and conditions affecting your Award are described in this Award Agreement and the Plan,
both of which you should read carefully. If you satisfy such conditions:

[1] The restrictions imposed on your Restricted Stock will be removed and you will own the
shares; and

1

 

[2] Your Performance Shares will be settled and you will receive the shares underlying such
Performance Shares. For purposes of this Award Agreement, each Performance Share represents
the right to receive a share of the Company’s common stock, par value $1.00 per share.

No later than Vte you must return a signed copy of this Award Agreement to:

Vtc

A. Schulman, Inc.

Vtg

Vth

If you do not do this, your Award will be forfeited and you will not be entitled to receive
anything on account of this Award.

Grant Date: Vtb.

Number of Shares of Restricted Stock and Performance Shares: You have been granted Vtf shares of
Restricted Stock and Vtg Performance Shares.

When Your Award Will Be Settled

In General:

Restricted Stock: Until the conditions described in this Award Agreement are met, your
Restricted Stock will be held in escrow. On the Settlement Date, these shares either will
be distributed to you, free of any restrictions, or forfeited, depending on whether or not
you satisfy the conditions described in this Award Agreement and in the Plan.

Performance Shares: Your Performance Shares will be settled or will be forfeited depending
on whether or not you satisfy the conditions described in this Award Agreement and in the
Plan.

Normal Settlement Date: Normally, your Award will be settled using the following formula:

Restricted Stock: If the Company’s total shareholder return performance (as described below)
is below the 25th percentile (i.e., 75% of the companies perform better), none of the shares
of your Restricted Stock will vest. If the Company’s total shareholder return performance
meets or exceeds the 25th percentile, but is below the 50th percentile, the restrictions
will lapse (and your Restricted Stock will vest) with respect to half of the shares of your
Restricted Stock. If the Company’s total shareholder return performance meets or exceeds
the 50th percentile, but is below the 75th percentile, the restrictions will lapse (and your
Restricted Stock will vest) with respect to all of the shares of your Restricted Stock.

Performance Shares: If the Company’s total shareholder return performance is below the 75th
percentile, all of your Performance Shares will be forfeited. All of your Performance
Shares will be settled if Schulman’s total shareholder return performance meets or exceeds
the 75th percentile.

2

 

The total shareholder return calculation takes the theoretical value of $100 invested in Schulman
stock on the Grant Date and the theoretical value of $100 invested with each of the peer group
companies on the Grant Date. At the end of three years, the value of the Schulman stock (assuming
all dividends are reinvested) is compared with the value of each of the peer group companies (again
assuming that all dividends are reinvested).

However, your Award may be settled earlier in the circumstances described in the next section.

How Your Award Might Be Settled Earlier Than the Normal Settlement Date: Your Award will be
immediately settled earlier than the Normal Settlement Date if there is a “change in control” (as
defined in the Plan).

How Your Termination of Employment Will Affect Your Award: You may forfeit your Award if you
terminate employment before the Normal Settlement Date, although this will depend on why you
terminate.

[1] If you terminate because of [a] death, [b] disability (as defined in the Plan) or [c]
after qualifying for retirement (as defined in the Plan) if the Committee agrees to treat
your termination as a “retirement,”

[i] Restricted Stock: You will receive a prorated number of the shares of Restricted
Stock granted through this Award Agreement but only if the performance criteria
described above are actually met at the Normal Settlement Date. If they are not,
all of your Restricted Stock will be forfeited. If those performance criteria are
met, you will receive a number of shares equal to:

	 	 	 	 	 	 	 	 	 
	 

	 	Number of shares that 
would
have been due to 
you if you
had not 
terminated before the

Normal Settlement Date
	 	 

X
	 	the number of whole months between

Vtb and your termination date              

the number of whole months between

Vtb and the Normal Settlement Date
	 	 

[ii] Performance Shares: You will receive a prorated number of the shares underlying
your Performance Shares granted through this Award Agreement but only if the
performance criteria described above are actually met at the Normal Settlement Date.
If they are not, all of your Performance Shares will be forfeited. If those
performance criteria are met, you will receive a number of shares equal to:

	 	 	 	 	 	 	 	 	 
	 

	 	Number of shares that 
would
have been due to 
you if you
had not 
terminated before the

Normal Settlement Date
	 	 

X
	 	the number of whole months between

Vtb and your termination date              

the number of whole months between

Vtb and the Normal Settlement Date
	 	 

[2] If you terminate under any other circumstances, all of the shares of Restricted Stock
and Performance Shares granted through this Award Agreement will be forfeited.

3

 

Settling Your Award

If all applicable conditions have been met, your vested Restricted Stock will be settled
automatically. If all applicable conditions have been met, you will receive the shares
underlying your vested Performance Shares as soon as administratively feasible, but no later
than 60 days, after the last day of the Performance Period (as defined in the Plan).

Other Rules Affecting Your Award

Rights During the Performance Period:

Restricted Stock: During the Performance Period (and even though these shares are held in
escrow until they are settled), you may exercise any voting rights associated with your
Restricted Stock. You also will be entitled to receive any dividends or other distributions
paid on these shares, although these dividends and other distributions also will be held in
escrow and will vest and be settled (or forfeited) on the same terms and conditions as the
related shares of Restricted Stock.

Performance Shares: During the Performance Period, you will have no voting or dividend
rights with respect to the shares underlying the Performance Shares.

Beneficiary Designation: You may name a beneficiary or beneficiaries to receive any portion of
your Award that is settled after you die. This may be done only on the attached Beneficiary
Designation Form and by following the rules described in that form. This form need not be
completed now and is not required as a condition of receiving your Award. If you die without
completing a Beneficiary Designation Form or if you do not complete that form correctly, your
beneficiary will be your surviving spouse or, if you do not have a surviving spouse, your estate.

Tax Withholding: Applicable withholding taxes must be withheld with respect to your Award. These
taxes may be paid in one of several ways. They are:

	 	•	 	By the Company withholding this amount from other amounts owed to you (e.g., from
your salary);
	 
	 	•	 	By giving the Company a check (payable to “A. Schulman, Inc.”) in an amount equal to
the taxes that must be withheld; or
	 
	 	•	 	By having the Company withhold a portion of the shares that otherwise would be
distributed. The number of shares withheld will have a fair market value equal to the
taxes that must be withheld.

You must choose the approach you prefer before the shares are transferred to you, although the
Company may reject your preferred method for any reason (or for no reason). If this happens, the
Company will specify (from among the alternatives just listed) how these taxes are to be paid.

If you do not choose a method within 30 days of the Settlement Date, the Company will withhold
either through payroll practices or a portion of the shares that otherwise would be distributed.

4

 

The number of shares withheld will have a fair market value equal to the taxes that must be
withheld and the balance of the shares will be distributed to you.

Transferring Your Award: Normally, your Award may not be transferred to another person. However,
you may complete a Beneficiary Designation Form to name the person to receive any portion of your
Award that is settled after you die. Also, the Committee may allow you to place your Award into a
trust established for your benefit or the benefit of your family. Contact Vtc at the address or
number given below if you are interested in doing this.

Governing Law: This Award Agreement will be construed in accordance with and governed by the laws
(other than laws governing conflicts of laws) of the State of Ohio, except to the extent that the
Delaware General Corporation Law is mandatorily applicable.

Other Agreements: Also, your Award will be subject to the terms of any other written agreements
between you and the Company to the extent that those other agreements do not directly conflict with
the terms of the Plan or this Award Agreement.

Adjustments to Your Award: Your Award will be adjusted, if appropriate, to reflect any change to
the Company’s capital structure (e.g., the number of your Restricted Stock and Performance Shares
will be adjusted to reflect a stock split).

Other Rules: Your Award also is subject to more rules described in the Plan. You should read the
Plan carefully to ensure you fully understand all the terms and conditions of this Award.

*****

You may contact Vtc at the address or number given below if you have any questions about your Award
or this Award Agreement.

*****

Your Acknowledgment of Award Conditions

Note: You must sign and return a copy of this Award Agreement to Vtc at the address given below no
later than Vte.

By signing below, I acknowledge and agree that:

	 	•	 	A copy of the Plan has been made available to me;
	 
	 	•	 	I understand and accept the conditions placed on my Award;
	 
	 	•	 	I will consent (in my own behalf and in behalf of my beneficiaries and without any
further consideration) to any change to my Award or this Award Agreement to avoid
paying penalties under Section 409A of the Internal Revenue Code, even if those changes
affect the terms of my Award and reduce its value or potential value; and

5

 

	 	•	 	If I do not return a signed copy of this Award Agreement to the address shown below
by Vte, my Award will be forfeited and I will not be entitled to receive anything on
account of this Award.

	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	Vtq	 	 	 	A. SCHULMAN, INC.
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	 	 	 
	 	 	 	 	 
	(signature)
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Date signed:	 	 	 	Date signed:	 	 
	 

	 	 
	 	 	 	 	 	 

A signed copy of this form must be sent to the following address no later than Vte:

Vtc

A. Schulman, Inc.

Vtg

Vth

Vtd

After it is received, the A. Schulman, Inc. 2006 Incentive Plan Committee will acknowledge receipt
of your signed Award Agreement.

*****

6

 

Committee’s Acknowledgment of Receipt

A signed copy of this Award Agreement was received on                     .

By:
                                        
                    

Vtq:

___ Has complied with the conditions imposed on the grant and the Award and the Award
remains in effect; or

___ Has not complied with the conditions imposed on the grant and the Award and the Award
is forfeited because

 

 

.

describe deficiency

A. Schulman, Inc. 2006 Incentive Plan Committee

	 	 	 	 	 
	 

	 	 	 	 
	By:
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Date:
	 	 	 	 
	 

	 	 	 	 

Note: Send a copy of this completed form to Vtq and keep a copy as part of the Plan’s permanent
records.

7

 

A. SCHULMAN, INC.

2006 INCENTIVE PLAN

BENEFICIARY DESIGNATION FORM

RELATING TO PERFORMANCE-BASED RESTRICTED STOCK AND

PERFORMANCE SHARES ISSUED TO VTA ON VTB

Instructions for Completing This Form

You may use this form to [1] name the person you want to receive any amount due under the A.
Schulman, Inc. 2006 Incentive Plan after your death or [2] change the person who will receive these
benefits.

There are several things you should know before you complete this form.

First, if you do not elect another beneficiary, any amount due to you under the Plan when you die
will be paid to your surviving spouse or, if you have no surviving spouse, to your estate.

Second, your election will not be effective (and will not be implemented) unless you complete all
applicable portions of this form and return it to Vtc at the address given below.

Third, all elections will remain in effect until they are changed (or until all death benefits are
paid).

Fourth, if you designate your spouse as your beneficiary but are subsequently divorced from that
person (or your marriage is annulled), your beneficiary designation will be revoked automatically.

Fifth, if you have any questions about this form or if you need additional copies of this form,
please contact Vtc at Vtd or at the address or number given below.

1.00 Designation of Beneficiary

1.01 Primary Beneficiary:

I designate the following persons as my primary beneficiary or beneficiaries to receive any amount
due after my death under the terms of the Award Agreement described at the top of this form. This
benefit will be paid, in the proportion specified, to:

	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	___% to	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 

 

 

	 	 	 	 	 	 	 	 	 
	 

	 	___% to	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	___% to	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	___% to	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 

1.02 Contingent Beneficiary:

If one or more of my primary beneficiaries die before I die, I direct that any amount due after my
death under the terms of the Award Agreement described at the top of this form:

___ Be paid to my other named primary beneficiaries in proportion to the allocation given
above (ignoring the interest allocated to the deceased primary beneficiary); or

___ Be distributed, in the proportion specified, among the following contingent
beneficiaries:

	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	___% to	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	___% to	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	___% to	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	___% to	 	 	 	 	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	(Name)
	 	(Relationship)	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	Address:	 	 	 	 	 	 
	 	 	 	 	 	 	 

****

2

 

Elections made on this form will be effective only after this form is received by Vtc and only if
it is fully and properly completed and signed.

Vtq

	 	 	 	 	 
	 

	 	 	 	 
	Date of Birth:
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	Address:
	 	 	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 	 	 

Sign and return this form to Vtc at the address given below.

	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	Date

	 	 	 	Signature	 	 

Return this signed form to Vtc at the following address:

Vtc

A. Schulman, Inc.

Vtg

Vth

Vtd

Received on:
                                        

	 	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

	 	 

3

 

A. SCHULMAN, INC.

2006 INCENTIVE PLAN

INSTRUCTIONS FOR COMPLETING SECTION 83(b) ELECTION FORM RELATING

TO RESTRICTED STOCK AWARD

You may make a Section 83(b) Election by completing the Section 83(b) Election Form. To do this:

	 	•	 	You must make the election by completing the attached form;
	 
	 	•	 	Within 30 days of Vtb, you must send a copy of this form to the Internal Revenue
Service Center at which you normally file your federal income tax return;
	 
	 	•	 	You also must send a copy of this form to:

Vtc

A. Schulman, Inc.

Vtg

Vth

4

 

A. SCHULMAN, INC.

2006 INCENTIVE PLAN

ELECTION UNDER SECTION 83(b)

OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED

The undersigned taxpayer hereby elects, pursuant to Section 83(b) of the Internal Revenue Code, to
include in taxpayer’s gross income for the current taxable year, the amount of any income that may
be taxable to taxpayer in connection with taxpayer’s receipt of the property described below:

	1.	 	The name, address, taxpayer identification number and taxable year of the undersigned
are as follows:
	 
	 	 	NAME OF TAXPAYER:           Vtq

	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	ADDRESS:	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 

	 	 	IDENTIFICATION NUMBER OF TAXPAYER:
                                        
                    
	 
	 	 	TAXABLE YEAR: Calendar year Vti
	 
	2.	 	The property with respect to which the election is made is:
	 
	 	 	Vtf shares of the Common Stock of A. Schulman, Inc., a Delaware corporation
(“Company”).
	 
	3.	 	The date on which the property was transferred is: Vtb.
	 
	4.	 	The property is subject to the following restrictions:
	 
	 	 	Forfeiture of:
	 
	 	 	___ shares in favor of the Company if the following conditions are not met during the
time specified:

Insert the performance-related conditions that must be met to earn the Restricted
Stock granted through this Award Agreement.

	5.	 	The fair market value at the time of transfer, determined without regard to any
restriction other than a restriction which by its terms will never lapse, of such
property is: $                     
	 
	6.	 	The amount (if any) paid for such property: $00.00.

5

 

The undersigned has submitted a copy of this statement to A. Schulman, Inc. The transferee of such
property is the person performing the services in connection with the transfer of said property.

The undersigned understands that the foregoing election may not be revoked except with the consent
of the Commissioner.

	 	 	 	 	 	 	 
	Dated:
	 	 	 	 	 	 
	 

	 	 
	 	 	 	 
	 

	 	 	 	 	 	Vtq

6

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