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LIQUIDITY SERVICES, INC.
EXECUTIVE EMPLOYMENT AGREEMENT  
THIS EXECUTIVE EMPLOYMENT AGREEMENT (“Agreement”) is entered into as of October 1, 2020 (the “Effective Date”), by and between Liquidity Services, Inc., a Delaware corporation (“LSI” or the “Company”), and Novelette Murray (the “Executive”).
1.Employment Agreement.  On the terms and conditions set forth in this Agreement, the Company agrees to employ the Executive and the Executive agrees to be employed by the Company for the Employment Period set forth in Section 2 hereof and in the position and with the duties set forth in Section 3 hereof.  Terms used herein with initial capitalization are defined in Section 10.12 below.
2.         Term.  The term of employment under this Agreement shall be the period set forth in Schedule 1 attached hereto commencing on the Effective Date (the “Employment Period”).
3.         Position and Duties.  The Executive shall serve in the position and with the duties and title set forth in Schedule 1 attached hereto during the Employment Period.  In such capacity, the Executive shall have the normal duties, responsibilities, and authority of such position, subject to the power of the Executive’s “Reporting Officer” as designated in Schedule 1, the Chairman of the Board of Directors (the “Board”) or the Board to reasonably expand or limit such duties, responsibilities and authority. The Executive shall report to the Reporting Officer designated in Schedule 1.  The Executive shall devote the Executive’s best efforts and full business time and attention to the business and affairs of the Company; provided, however, that Executive may, to the extent such participation or service does not materially interfere with the performance of the obligations described in this Agreement, (i) participate in charitable, civic, political, social, trade, or other non-profit organizations and (ii) with the consent of the Board such consent not to be unreasonably withheld, serve as a non-management director of business corporations (or in a like capacity in other for-profit organizations). 
1.Place of Performance.  In connection with the Executive’s employment by the Company, the Executive shall be based at the principal executive offices of the Company, except as otherwise agreed by the Executive and the Company and except for reasonable travel on Company business.  
2.Compensation.
5.1.     Base Salary.  During the Employment Period, the Company shall pay to the Executive an annual base salary (the “Base Salary”), which initially shall be at the rate per year as set forth in Schedule 1.  The Base Salary shall be payable semi-monthly or in such other installments as shall be consistent with the Company’s payroll procedures. The Base Salary may be increased at any time or from time to time, but it may not be decreased without the consent of the Executive.
5.2        Bonus.  The Executive shall be eligible for a performance bonus as set forth in Schedule 1. Bonus eligibility will commence in the 2021 Fiscal year, which begins October 1, 2020.
                        5.3        Equity Awards.

5.3.1.    Annual Award.  Subject to any conditions set in Schedule 1, Executive shall be eligible to receive an annual equity award, subject to the terms of the Liquidity Services, Inc. Second Amended and Restated 2006 Omnibus Long-Term Incentive Plan or successor plan, as determined by the Board or any committee thereof.

5.3.2     Special Award.  In consideration of Executive entering into this Agreement and subject to approval by the Board or any committee thereof, the Company shall grant Executive the equity awards described in Schedule 1.

5.4        Benefits.  During the Employment Period, the Executive will be entitled to receive such other benefits approved by the Reporting Officer and made available to similarly situated senior executives of the Company, including health insurance, disability insurance, and 401(k) benefits.  At all times the Company agrees to maintain Director’s and Officer’s Liability coverage for the Executive. Nothing contained in this Agreement shall prevent the Company from changing insurance carriers or otherwise modifying the Company’s employee benefit programs. 
5.5        Employee Leave.  The Executive shall be entitled to all public holidays observed by the Company in addition to a total of 26 days of paid time off in accordance with the applicable policies of the Company, which shall be taken at a reasonable time or times per year.
6.         Expenses.  The Executive is expected and is authorized to incur reasonable expenses in the performance of his duties hereunder, including the costs of entertainment, travel, and similar business expenses 

incurred in the performance of his duties.  The Company shall reimburse the Executive for all such expenses promptly upon periodic presentation by the Executive of an itemized account of such expenses and appropriate receipts.  Any reimbursements provided under this Agreement that constitute deferred compensation within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) shall be made or provided in accordance with the requirements of Code Section 409A, including that (i) in no event shall any fees, expenses or other amounts eligible to be reimbursed by the Company under this Agreement be paid later than the last day of the calendar year next following the calendar year in which the applicable fees, expenses or other amounts were incurred; and (ii) the amount of expenses eligible for reimbursement that the Company is obligated to pay or provide, in any given calendar year shall not affect the expenses that the Company is obligated to reimburse in any other calendar year.
7.         Termination of Employment.  
            7.1.       Termination.  The Executive’s employment by the Company during the Employment Period will continue until Executive’s death, Disability, resignation or until Executive’s termination by the Reporting Officer or the Board at any time.
            7.2.       Notice of Termination.  Any termination of the Executive’s employment by the Company or the Executive (other than because of the Executive’s death) shall be communicated by written Notice of Termination to the other party hereto in accordance with Section 10.1 hereof.  For purposes of this Agreement, a “Notice of Termination” shall mean a notice which shall indicate the specific termination provision in this Agreement relied upon, if any, and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive’s employment under the provision so indicated.  Termination of the Executive’s employment shall take effect on the Date of Termination.
8.         Compensation Upon Termination.
            8.1.       Death.  If the Executive’s employment is terminated during the Employment Period as a result of the Executive’s death, the Company shall pay to the Executive’s estate, or as may be directed by the legal representatives of such estate, the Executive’s full Base Salary through the next full calendar month following the Date of Termination and all other unpaid amounts, if any, to which the Executive is entitled as of the Date of Termination in connection with any fringe benefits pursuant to Section 5.4 and expenses pursuant to Section 6. Subject to Section 8.5 below, the payments contemplated by this Section 8.1 shall be paid at the time they are due, and the Company shall have no further obligations to the Executive or his or her estate under this Agreement.
            8.2.       Disability.  If the Company terminates the Executive’s employment during the Employment Period because of the Executive’s Disability, the Company shall pay the Executive the Executive’s full Base Salary through the third full calendar month following the Date of Termination and all other unpaid amounts, if any, to which the Executive is entitled as of the Date of Termination in connection with any fringe benefits pursuant to Section 5.4 and expenses pursuant to Section 6. Subject to Section 8.5 below, the payments contemplated by this Section 8.2 shall be paid at the time they are due, and the Company shall have no further obligations to the Executive under this Agreement; provided, however, that the Base Salary shall be reduced by the amount of any disability benefit payments made to the Executive during a period of Disability from any insurance or other policies provided by the Company.  
8.3.       By the Company with Cause or by the Executive without Good Reason.  If the Company terminates the Executive’s employment during the Employment Period for Cause or if the Executive voluntarily terminates the Executive’s employment during the Employment Period other than for Good Reason, the Company shall pay the Executive the Executive’s full Base Salary through the Date of Termination and all other unpaid amounts, if any, to which Executive is entitled as of the Date of Termination in connection with any fringe benefits pursuant to Section 5.4 and expenses pursuant to Section 6.  Subject to Section 8.5 below, the payments contemplated by this Section 8.3 shall be paid at the time such payments are due, and the Company shall have no further obligations to the Executive under this Agreement.
a.By the Company without Cause or by the Executive for Good Reason.  If the Company terminates the Executive’s employment during the Employment Period other than for Cause, death, or Disability or the Executive terminates his employment during the Employment Period for Good Reason, the Company shall pay the Executive: (A) the Executive’s full Base Salary through the Date of Termination and all other unpaid amounts, if any, to which the Executive is entitled as of the Date of Termination in connection with any fringe benefits pursuant to Section 5.4 and expenses pursuant to Section 6; and (B) a lump-sum severance package equal to nine (9) months of the Executive’s Base Salary (collectively the “Severance Payment”). Subject to Section 8.5 below, the Severance Payment shall be payable to the Executive within 60 days of the Date of Termination, provided the Executive timely executes and returns a separation agreement and 

release of claims in a form acceptable to the Company, and such release has become irrevocable by such date.
b.Code Section 409A Matters. Anything in this Agreement to the contrary notwithstanding, if (A) on the date of Executive’s “separation from service” (within the meaning of Section 409A(a)(2)(A)(i) of the Code) with the Company, Executive is a “specified employee” (within the meaning of Section 409A(a)(2)(B)(i) of the Code) and (B) as a result of such separation from service, Executive would receive any payment under this Agreement that, absent the application of this Section 8.5, would be subject to the additional tax imposed pursuant to Section 409A(a) of the Code as a result of the application of Section 409A(2)(B)(i) of the Code, then no such payment shall be payable prior to the date that is the earliest of (1) six months after the Executive’s separation from service, (2) the Executive’s death or (3) such other date as will cause such payment not to be subject to such additional tax. Any payments which are required to be delayed as a result of this Section 8.5 shall be accumulated and paid as a lump-sum on the earliest possible date determined in accordance the preceding sentence.
9.         Other Agreements.   Executive contemporaneously executed an Employee Agreement Regarding Confidentiality, Intellectual Property, and Competitive Activities (the “Employee Agreement”), and the terms and conditions of the Employee Agreement are specifically incorporated herein by reference.  Executive’s equity awards detailed in Schedule 1 shall be the subject of a separate grant agreements which shall control for purposes of the award terms and conditions.
1.Miscellaneous. 

a.Notices.  All notices, demands, requests or other communications required or permitted to be given or made hereunder shall be in writing and shall be delivered by hand or mailed by first class registered or certified mail or delivery carrier, postage prepaid, addressed as follows:

                        10.1.1.  If to the Company:
            Liquidity Services, Inc.
            6931 Arlington Road, Suite 200
            Bethesda, MD 20814
            ATTN:    VP, General Counsel & Corporate Secretary

                        10.1.2.  If to the Executive:
            at the address set forth in Schedule 1.

or to such other address as may be designated by either party in a notice to the other.  Each notice, demand, request or other communication that shall be given or made in the manner described above shall be deemed sufficiently given or made for all purposes three days after it is deposited in the U.S. mail, postage prepaid, or at such time as it is delivered to the addressee (with the return receipt, the delivery receipt, the answer back, the confirmation (if electronic record) or the affidavit of messenger being deemed conclusive evidence of such delivery) or at such time as delivery is refused by the addressee upon presentation.
            10.2.     Representations.  Executive agrees to execute any proper oath or verify any proper document required to carry out the terms of this Agreement.  Executive represents that performance of all the terms of this Agreement and the Employee Agreement will not breach any existing non-compete or similar agreement.  Executive has not entered into, and Executive agrees not to enter into, any oral or written agreement in conflict herewith.
            10.3.     Severability.  The invalidity or unenforceability of any one or more provisions of this Agreement shall not affect the validity or enforceability of the other provisions of this Agreement, which shall remain in full force and effect.
            10.4.     Survival.  It is the express intention and agreement of the parties hereto that the provisions of Section 8 hereof shall survive the termination of employment of the Executive.  In addition, all obligations of the Company to make payments hereunder shall survive any termination of this Agreement on the terms and conditions set forth herein.
            10.5.     Assignment.  The rights and obligations of the parties to this Agreement shall not be assignable or delegable, except that (i) in the event of the Executive’s death, the personal representative or legatees or distributees of the Executive’s estate, as the case may be, shall have the right to receive any amount owing and unpaid to the Executive hereunder and (ii) the rights and obligations of the Company hereunder shall be assignable 

and delegable to any Affiliate of the Company or in connection with any subsequent merger, consolidation, sale of all or substantially all of the assets of the Company or similar reorganization of a successor corporation.
            10.6.     Binding Effect.  Subject to any provisions hereof restricting assignment, this Agreement shall be binding upon the parties hereto and shall inure to the benefit of the parties and their respective heirs, devisees, executors, administrators, legal representatives, successors and assigns.
            10.7.     Amendment; Waiver.  This Agreement shall not be amended, altered or modified except by an instrument in writing duly executed by the parties hereto; provided, that the parties may amend Schedule 1 hereto by executing and delivering a revised version of Schedule 1 and attaching such revised version to this Agreement.  Neither the waiver by either of the parties hereto of a breach of or a default under any of the provisions of this Agreement, nor the failure of either of the parties, on one or more occasions, to enforce any of the provisions of this Agreement or to exercise any right or privilege hereunder, shall thereafter be construed as a waiver of any subsequent breach or default of a similar nature, or as a waiver of any such provisions, rights or privileges hereunder. 
            10.8.     Headings.  Section and subsection headings contained in this Agreement are inserted for convenience of reference only, shall not be deemed to be a part of this Agreement for any purpose, and shall not in any way define or affect the meaning, construction or scope of any of the provisions hereof.
            10.9.     Governing Law.  This Agreement, the rights and obligations of the parties hereto, and any claims or disputes relating thereto, shall be governed by and construed in accordance with the laws of the State of Maryland not including the choice of law rules thereof.  Any suit, action or proceeding arising out of or relating to this Agreement must be instituted in the state or federal courts located in Montgomery County, Maryland.  Each of the Company and the Executive irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action or proceeding.
            10.10.   Entire Agreement. This Agreement, including Schedule 1 hereto and the Employee Agreement, constitute the entire agreement between the parties respecting the employment of Executive, there being no representations, warranties or commitments except as set forth herein.
            10.11    Counterparts.  This Agreement may be executed in two or more counterparts, each of which shall be an original and all of which shall be deemed to constitute one and the same instrument.
            10.12.   Definitions.
            “Affiliate” means as to a specified Person any other Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, the specified Person.
            “Agreement” means this Executive Employment Agreement.
            “Base Salary” is defined in Section 5.1 above.
            “Beneficial Owner” means a beneficial owner within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as amended.
                        “Cause” means (i) a material breach by the Executive of any term of this Agreement, the Company’s policies set by the Board or the Company, the Company’s Code of Conduct, Executive’s fiduciary duties to the Company or of any law, statute or regulation; (ii) the material failure to achieve the Company’s written objectives or goals as reasonably determined by the Executive’s Reporting Officer in consultation with the Executive and the Board of Directors or a committee thereof; (iii) misconduct which is injurious to the Company or any of its affiliates, either monetarily or otherwise, or which impairs Executive’s ability to effectively perform his duties or responsibilities; (iv) personal conduct which reflects poorly on the Company or Executive or which impairs the Executive’s ability to perform his duties or manage subordinate employees, including but not limited to the abuse of alcohol or controlled substances; (v) habitual or repeated neglect of Executive’s duties or responsibilities; (v) misappropriation of (or attempted misappropriation of) a business opportunity of the Company or its affiliates, including attempting to secure or securing any personal profit in connection with any transaction by the Company or its affiliates; (vi) the commission of or conviction for (or the procedural equivalent or conviction for), or the entering of a guilty plea or plea of no contest with respect to a crime, which in the Company’s reasonable judgment, involves moral turpitude; (vii) the commission of or conviction for (or the procedural equivalent or conviction for), or the entering of a guilty plea or plea of no contest with respect to a crime, which is a felony or in the Company’s reasonable judgment, involves moral turpitude; (viii) intentional injury of another employee or any person in the course of performing services for the company; any conflict of interest, including, but not limited to solicitation of business on behalf of a competitor or potential competitor; (ix) any conflict of interest, including, but not limited to solicitation of business on behalf of a competitor or potential competitor; (x) violation of the company’s policies prohibiting discrimination or harassment of employees, clients, guests or vendors of the Company; failure to comply with the company’s written Human Resources policies published on LSI Connect or any replacement to this; or (xi) failure to follow any material and lawful instruction given to Executive by Executive’s Reporting Officer.

            “Company” means Liquidity Services, Inc. and its successors and assigns.
            “Date of Termination” means (i) if the Executive’s employment is terminated by the Executive’s death, the date of the Executive’s death; (ii) if the Executive’s employment is terminated because of the Executive’s Disability, 30 days after Notice of Termination; (iii) if the Executive’s employment is terminated by the Company with or without Cause, the date specified in the Notice of Termination; (iv) if the Executive’s employment is terminated by the Executive with or without Good Reason, the date specified in the Executive’s Notice of Termination, which shall be no less than 30 days following the date on which the Notice of Termination is delivered; provided that the Company may waive all or any of the notice period for no consideration and the Executive’s Termination Date shall be determined by the Company; and (iv) if the Executive’s employment is terminated during the Employment Period other than pursuant to Section 7.1, the date on which Notice of Termination is given.
            “Disability” means the Executive’s inability to perform all of the Executive’s duties hereunder by reason of illness, physical or mental disability or other similar incapacity, as determined by a competent medical doctor appointed by the Reporting Officer after a complete and thorough medical examination and evaluation, which inability shall continue for more than three consecutive months or for such shorter periods that when aggregated exceed six (6) months in any twelve (12) month period.
            “Effective Date” means the date as of which this Agreement is executed as set out above.
            “Employee Agreement” is defined in Section 9 above.
            “Employment Period” is defined in Section 2 above.
                        “Good Reason” means (i) the Company’s failure to perform or observe any of the material terms or provisions of this Agreement (including the provisions of Schedule 1) or the Employee Agreement, and the failure of the Company to cure such default within 30 days after written demand for performance has been given to the Company by the Executive, which demand shall describe specifically the nature of such alleged failure to perform or observe such material terms or provisions; or (ii) a material reduction in the scope of the Executive’s responsibilities and duties without the written consent of Executive; or (iii) any change to the job title given to Executive without her written consent; or (iv) any reduction in Base Salary or any other material change in benefits provided to Executive hereunder; or (v) any constructive termination of Executive; or (vi) any request, instruction, directive or order, whether direct or indirect, to Executive by the Board, the Company or any executive officer of the Company to perform any act which is unlawful; or (vii) a requirement by the Company for the Executive to relocate outside of the Washington DC metropolitan region to retain his position without the written consent of the Executive. 

            “Notice of Termination” is defined in Section 7.2 above.
“Person” means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.
            “Severance Payment” is defined in Section 8.4 above.
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement, or have caused this Agreement to be duly executed on their behalf, as of the day and year first hereinabove written.

                                                        

															
			LIQUIDITY SERVICES, INC.
			
			By:		/s/ William P. Angrick, III
William P. Angrick, III

					CEO and Chairman
					
			EXECUTIVE:
					/s/ Novelette Murray
Novelette Murray

					

                             

SCHEDULE 1

CERTAIN TERMS OF EMPLOYMENT

All capitalized but undefined terms in this Schedule shall have the meaning ascribed to them in the Agreement.

Executive: Novelette Murray

Position/Title:  Chief Human Resources Officer  

Duties:  In coordination with the CEO and executive leadership team this position will have responsibility for the Company’s human resources strategy and for driving human resources best practices across the enterprise to support the needs of LSI’s business. 

These responsibilities shall include: recruiting, leadership development, talent alignment with Company strategy, institution of best practices for succession/bench strength; designing and communicating executive compensation programs with the CEO and Board Compensation Committee; communicating and reinforcing the Company’s culture across our dispersed organization (including acquired companies), M&A due diligence/integration from a human capital perspective; employee engagement and diversity programs, ensuring our existing team’s maintenance of best practices regarding performance reviews, compliance training, employee benefits, and healthcare.

Anticipated Start Date: October 1, 2020

Employment Term:   One Year from the Effective Date, automatically renewable for successive one-year terms unless earlier terminated by either party.

Reporting Officer:  Chairman and CEO

Base Salary:  $280,000 per annum

Bonus:  Executive shall be eligible for an annual incentive bonus one year from the Effective Date with a target of 50% of her Base Salary based upon the Company’s or the Executive’s achievement of certain deliverables or goals by the Executive and the Board’s Compensation Committee.  The amount of the bonus is further governed by the financial performance of the company. The Board’s Compensation Committee reserves the right to award a discretionary bonus based on the Executive’s performance and contributions.

Special Award: In consideration of Executive entering into this Agreement and subject to approval by the Board or the Board’s Compensation Committee, the Company shall grant Executive 40,000 shares of Restricted Stock pursuant to the Liquidity Services, Inc. Third Amended and Restated 2006 Omnibus Long-Term Incentive Plan, the grant date of which shall be the date the grant is approved by the Board or any committee thereof (the “Special Award”). Vesting shall commence on October 1, 2020 as follows:
•The restrictions on half of the Special Award shall lapse equally over four years, with twenty-five percent of the Restricted Stock vesting each year on the anniversary of the vesting commencement  date.  
•The restrictions on the other half of the Special Award will be performance-based shares dependent on Company attaining certain financial targets over a four-year period of time, which financial targets shall be set by the Board or a committee thereof.  The targets will be explained in a written equity grant agreement that shall be separately furnished to the Executive.

Review and approval of Executive’s new hire equity will be reviewed by the Board or the Compensation Committee thereof at its next meeting.  All other terms and conditions of such award shall be governed by the Liquidity Services, Inc. Third Amended and Restated 2006 Omnibus Long-Term Incentive Plan and the applicable award agreements.

Annual Equity Award: In addition to Executive’s initial equity award, Executive will be eligible for annual equity awards as part of the as part of the executive leadership team’s annual equity program which shall be subject to review and approval by the board’s compensation committee 

Ownership Requirement: Executive is subject to the Company’s equity ownership policy to align Executive’s interests with those of LSI’s public shareholders. This policy requires Executive to hold 150% of her base salary in equity and the Company’s expectation is that Executive will be able to meet this requirement by accumulating vested equity through the grant process and not be required to purchase shares of stock outright.

															
					
	COMPANY:				EXECUTIVE:
	/s/ William P. Angrick, III
William P. Angrick, III
				/s/ Novelette Murray
Novelette Murray

	Chairman & CEODocument

Liquidity services, inc.
ANNUAL INCENTIVE PLAN 

1.Purpose. The purpose of the Liquidity Services, Inc. Annual Incentive Plan (the “Plan”) is to attract and retain key executives and management team members for Liquidity Services, Inc., a Delaware corporation (the “Corporation”), and its Subsidiaries and to provide such persons with an annual cash bonus incentives based on the achievement of pre-established performance goals.

2.Definitions. As used in this Plan,
“Board” means the Board of Directors of the Corporation.
“Code” means the Internal Revenue Code of 1986, as amended from time to time.
“Committee” means the Compensation Committee of the Board or any other committee appointed by the Board to administer the Plan.
“Eligible Participant” means any executive officer or other employee of the Corporation or its Subsidiaries designated by the Committee.
“Incentive Bonus” shall mean, for each Eligible Participant, a bonus opportunity amount determined by the Committee pursuant to Section 5 below.
“Management Objectives” means the achievement of a performance objective or performance goals for a Performance Period established pursuant to this Plan for Eligible Participants. Management Objectives may be described in terms of Corporation-wide objectives or objectives that are related to the performance of the individual Eligible Participant or of the Subsidiary, division, department or function within the Corporation or Subsidiary in which the Eligible Participant is employed. The Management Objectives shall be limited to specified levels of, growth in or relative peer company performance in one or more of the following (and the Committee may, for a Performance Period, amend or adjust the applicable Management Objective(s) or other terms and conditions relating thereto in recognition of (1) asset write-downs; (2) litigation or claim judgments or settlements; (3) the effect of changes in tax laws, accounting principles, regulations, or other laws or regulations affecting reported results; (4) any reorganization and restructuring programs; (5) acquisitions or divestitures; (6) unusual, nonrecurring or extraordinary items identified in the Corporation’s audited financial statements, including footnotes; (7) capital charges; (8) costs and expenses; or (9) similar non-GAAP adjustments):
i.Sales, including (i) net sales, (ii) unit sales volume, and (iii) aggregate product price;
ii.Share price, including (i) market price per share, and (ii) share price appreciation;
iii.Earnings, including (i) earnings per share, reflecting dilution of shares, (ii) gross or pretax profits, (iii) post-tax profits, (iv) operating profit, (v) contribution profit, (vi) gross profit, (vii) earnings net of or including dividends, (viii) earnings net of or including the after-tax cost of capital, (ix) earnings before (or after) interest and taxes (“EBIT”), (x) earnings per share from continuing operations, diluted or basic, (xi) earnings before interest, taxes, depreciation and amortization (“EBITDA”), (xii) adjusted EBIT or adjusted EBITDA, (xiii) pre-tax operating earnings after interest and before incentives, service fees and extraordinary or special items, (xiv) operating earnings, (xv) growth in earnings or growth in earnings per share, (xvi) total earnings (xvii) operating income;
iv.Return on equity, including (i) return on equity, (ii) return on invested capital, (iii) return or net return on assets, (iv) return on net assets, (v) return on equity, (vi) return on gross sales, (vii) return on investment, (viii) return on capital, (ix) return on invested capital, (x) return on committed capital, (xi) financial return ratios, (xii) value of assets, and (xiii) change in assets;
v.Cash flow(s), including (i) operating cash flow, (ii) net cash flow, (iii) free cash flow, (iv) cash flow on investment, (v) levered free cash flow, and (vi) unlevered free cash flow;
vi.Revenue, including (i) gross or net revenue, and (ii) changes in annual revenues;
vii.Margins, including (i) adjusted pre-tax margin, and (ii) operating margins;
viii.Income, including (i) net income, and (ii) consolidated net income;
ix.Economic value added;
x.Costs, including (i) operating or administrative expenses, (ii) operating expenses as a percentage of revenue, (iii) general and administrative expenses as a percentage of revenue, (iv) expense or cost levels, (v) reduction of losses, loss ratios or expense ratios, (vi) reduction in fixed costs, (vii) expense reduction levels, (viii) operating cost management, and (ix) cost of capital;

xi.Financial ratings, including (i) credit rating, (ii) capital expenditures, (iii) debt, (iv) debt reduction, (v) working capital, (vi) average invested capital, and (vii) attainment of balance sheet or income statement objectives;
xii.Market or category share, including (i) market share, (ii) volume, (iii) unit sales volume, and (iv) market share or market penetration with respect to specific designated products or product groups and/or specific geographic areas;
xiii.Shareholder return, including (i) total shareholder return, stockholder return based on growth measures or the attainment of a specified share price for a specified period of time, and (ii) dividends; and
xiv.Objective nonfinancial performance criteria measuring either (i) regulatory compliance, (ii) productivity and productivity improvements, (iii) inventory turnover, average inventory turnover or inventory controls, (iv) net asset turnover, (v) customer satisfaction based on specified objective goals or company-sponsored customer surveys, (vi) employee satisfaction based on specified objective goals or company-sponsored employee surveys, (vii) objective employee diversity goals, (viii) employee turnover, (ix) specified objective environmental goals, (x) specified objective social goals, (xi) specified objective goals in corporate ethics and integrity, (xii) specified objective safety goals, (xiii) specified objective business expansion goals or goals relating to acquisitions or divestitures, and (xiv) succession plan development and implementation.

“Performance Period” means the period for which performance is calculated, which shall be the Plan Year unless otherwise specified by the Committee.
“Plan Year” means the Corporation’s fiscal year which begins on October 1 and ends on September 30, with the first Plan Year of the Plan commencing October 1, 2020 and ending September 30, 2021.
“Pro-rated Incentive Bonus” means an amount equal to the Incentive Bonus otherwise payable to an Eligible Participant for a Performance Period in which the Eligible Participant was actively employed by the Corporation or a Subsidiary, multiplied by a fraction, the numerator of which is the number of days the Eligible Participant was actively employed by the Corporation or a Subsidiary during the Performance Period and the denominator of which is the number of days in the Performance Period.
“Regulations” mean the Treasury Regulations promulgated under the Code, as amended from time to time.
“Subsidiary” means a corporation, partnership, joint venture, unincorporated association or other entity in which the Corporation has a direct or indirect ownership or other equity interest.
“Termination for Cause” means a termination of employment of an Eligible Participant by the Corporation or a Subsidiary due to the Eligible Participant’s (a) willful failure to substantially perform his or her duties with the Corporation (other than any such failure resulting from the Eligible Participant’s disability), after a written demand for substantial performance is delivered to the Eligible Participant that specifically identifies the manner in which the Corporation believes that the Eligible Participant has not substantially performed his or her duties, and the Eligible Participant has failed to remedy the situation within fifteen (15) business days of such written notice from the Corporation; (b) willful gross negligence in the performance of the Eligible Participant’s duties; (c) conviction of, or plea of guilty or nolo contendere, to any felony or a lesser crime or offense which, in the reasonable opinion of the Corporation, could adversely affect the business or reputation of the Corporation; (d) willful engagement in conduct that is demonstrably and materially injurious to the Corporation, monetarily or otherwise; (e) willful violation of any provision of the Corporation’s code of conduct; (f) act of dishonesty resulting in, or intended to result in, personal gain at the expense of the Corporation; (g) engaging in any act that is intended to harm, or may be reasonably expected to harm, the reputation, business prospects, or operations of the Corporation; or (h) engaging in any act that justifies termination of employment with immediate effect under the local laws applicable to the Eligible Participant’s employment relationship.
i.For purposes of this Plan, there shall be no Termination for Cause pursuant to subsections (a) through (g) above, unless a written notice, containing a detailed description of the grounds constituting cause hereunder, is delivered to the Eligible Participant stating the basis for the termination. Upon receipt of such notice, the Eligible Participant shall be given thirty (30) days to fully cure (if such violation, neglect, or conduct is capable of cure) the violation, neglect, or conduct that is the basis of such claim.
ii.For purposes of this definition, no act or omission by the Eligible Participant shall be considered “willful” unless it is done or omitted in bad faith or without reasonable belief that the Eligible Participant’s action or omission was in the best interests of the Corporation. Any act or failure to act based upon: (a) authority given pursuant to a resolution duly adopted by the Board; or (b) advice of counsel for the Corporation, shall be conclusively presumed to be done or omitted to be done by the Eligible Participant in good faith and in the best interests of the Corporation.

iii.As used herein, “disability” shall have the meaning set forth in the definition of Disability within the Corporation’s applicable policies and procedures.
3.Administration of the Plan. The Plan shall be administered by the Committee, which shall have full power and authority to construe, interpret and administer the Plan and shall have the exclusive right to establish Management Objectives for a Performance Period and the amount of Incentive Bonus payable to each Eligible Participant upon the achievement of the specified Management Objectives.
4.Eligibility. Eligibility under this Plan is limited to Eligible Participants designated by the Committee in its sole and absolute discretion.
5.Awards.
a.Subject to Regulations under Code Section 409A, not later than the ninetieth (90th) day after the beginning of the applicable Performance Period (and upon which date the outcome of the Management Objective(s) applicable to such Incentive Bonus are substantially uncertain), the Committee shall establish the Management Objective(s) for each Eligible Participant and the amount of Incentive Bonus payable (or formula for determining such amount) upon full achievement of the specified Management Objective(s). The Committee may further specify in respect of the specified Management Objective(s) a minimum acceptable level of achievement below which no Incentive Bonus payment will be made and shall set forth a formula for determining the amount of any payment to be made if performance is at or above the minimum acceptable level but falls short of full achievement of the specified Management Objective(s).
b.The Committee retains the discretion to increase and to reduce the amount of any Incentive Bonus that would be otherwise payable to an Eligible Participant (including a reduction in such amount to zero).
6.Committee Determination. As soon as reasonably practicable after the end of each Performance Period, the Committee shall determine whether the applicable Management Objective(s) has/have been achieved and the amount of the Incentive Bonus to be paid to each Eligible Participant for such Performance Period.
7.Payment of Incentive Bonuses. Incentive Bonuses shall be paid within thirty (30) days after the Committee’s determination pursuant to Section 6, but in no event later than two and a half months from the end of the Performance Period. 
8.Termination of Employment.
a.Except as otherwise provided in Section 8(b), if an Eligible Participant’s employment with the Corporation and its Subsidiaries terminates prior to the date of payment of an Incentive Bonus with respect to a Performance Period, all of the Eligible Participant’s rights to an Incentive Bonus for such Performance Period shall be forfeited.
b.If an Eligible Participant’s employment with the Corporation and its Subsidiaries is terminated by reason of the Eligible Employee’s death or disability (or, in the Committee’s discretion any other termination other than a Termination for Cause, to the extent not established by another applicable agreement) during a Performance Period, the Eligible Participant (or the Eligible Participant’s estate) will be paid a Pro-rated Incentive Bonus. Payment of such Pro-rated Incentive Bonus will be made at the same time and in the manner as Incentive Bonuses are paid to other Eligible Participants pursuant to Section 7 of the Plan.
9.No Right to Bonus or Continued Employment. Neither the establishment of the Plan, the provision for or payment of any amounts hereunder nor any action of the Corporation, the Board or the Committee with respect to the Plan shall be held or construed to confer upon any person (a) any legal right to receive, or any interest in, an Incentive Bonus or any other benefit under the Plan or (b) any legal right to continue to serve as an officer or employee of the Corporation or any Subsidiary of the Corporation.
10.Withholding. The Corporation shall have the right to withhold or require an Eligible Participant to remit to the Corporation, an amount sufficient to satisfy any applicable federal, state, local or foreign withholding tax requirements imposed with respect to the payment of any Incentive Bonus.
11.Non-transferability. Except as expressly provided by the Committee, the rights and benefits under the Plan shall not be transferable or assignable other than by will or the laws of descent and distribution.
12.Amendment and Termination. The Committee may amend the Plan from time to time, provided that any such amendment shall comply with Section 409A, or an exception thereto, and the Regulations promulgated thereunder. The Committee may also terminate the Plan at any time; provided, however, that no termination shall adversely affect the rights of any Eligible Participant with respect to any Performance Period that commenced prior to such termination.
13.Governing Law. The Plan shall be construed, administered and enforced in accordance with the laws of the State of Delaware without regard to conflicts of law.

14.Code Section 409A. It is intended that payments of Incentive Bonuses under the Plan qualify as short-term deferrals exempt from the requirements of Section 409A of the Code.
15.Clawback. All Incentive Bonuses paid under the Plan are subject to any clawback policy of the Corporation as in effect from time to time and, in accordance with such policy, may be subject to the requirement that such Incentive Bonuses be repaid to the Corporation after they have been paid.
16.Unfunded Plan. The Plan is an unfunded compensation plan, and all payments to be made hereunder shall be paid from the general funds of the Corporation.
17.Establishment of Sub-plans.  The Board may from time to time establish one or more sub-plans under the Plan for purposes of providing a bonus opportunity to Participants at the Corporation.  The Board shall establish such sub-plans by adopting supplements to the Plan setting forth (a) such limitations on the Committee’s discretion under the Plan as the Board deems necessary or desirable, and (b) such additional terms and conditions not otherwise inconsistent with the Plan as the Board shall deem necessary or desirable.  All supplement adopted by the Board shall be deemed to be part of the Plan, but each supplement shall apply to only to the affected Eligible Participant.
18.Effective Date. This Plan shall remain effective until the date the Board terminates the Plan. 
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