Document:

exhibit10_10.htm

Exhibit 10.10

Security Agreement by and among Greenhouse Holdings, Inc. and Premier Alliance Group, Inc., dated

March 5, 2012

  

  

  

SECURITY AGREEMENT

THIS SECURITY AGREEMENT (the “Agreement”) is made as of March 5, 2012 by and among GreenHouse Holdings, Inc., a Nevada corporation (the “Company”), and the holders identified on the signature pages hereto and their respective endorsees, transferees and assigns (each a “Secured Party” and, collectively, the “Secured Parties”).

 

WHEREAS, pursuant to the Note Agreement, dated of even date herewith, the Company issued to the Secured Parties a certain 2% Senior Secured Promissory Note (the “Note”).

 

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

 

1. Certain Definitions.  As used in this Agreement, the following terms shall have the meanings set forth in this Section 1.  Terms used but not otherwise defined in this Agreement that are defined in Article 9 of the UCC (such as “general intangibles” and “proceeds”) shall have the respective meanings given such terms in Article 9 of the UCC.  All capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the Subscription Agreement.

 

a. “Collateral” means the collateral in which the Secured Parties are granted a security interest by this Agreement and which shall include the following, whether presently owned or existing or hereafter acquired or coming into existence, and all additions and accessions thereto and all substitutions and replacements thereof, and all proceeds, products and accounts thereof, including, without limitation, all proceeds from the sale or transfer of the Collateral and of insurance covering the same and of any tort claims in connection therewith:

 

i. All goods, including, without limitation, all machinery, equipment, computers, motor vehicles, trucks, tanks, boats, ships, appliances, furniture, special and general tools, fixtures, test and quality control devices and other equipment of every kind and nature and wherever situated, together with all documents of title and documents representing the same, all additions and accessions thereto, replacements therefor, all parts therefor, and all substitutes for any of the foregoing and all other items, owned by the Company and used in connection with the Company’s businesses and all improvements thereto; and

 

ii. All inventory of the Company; and

 

iii. All of the Company’s contract rights and general intangibles, including, without limitation, all partnership interests, stock or other securities, licenses, distribution and other agreements, computer software development rights, employee non-compete, non-disclosure and assignment of rights agreements, leases, franchises, customer lists, quality control procedures, grants and rights, goodwill, deposit accounts, and income tax refunds; and

 

iv. All receivables of the Company including, without limitation, all insurance proceeds, and rights to refunds or indemnification whatsoever owing, together with all instruments, all documents of title representing any of the foregoing, all rights in any merchandising, goods, equipment, motor vehicles and trucks which any of the same may represent, and all right, title, security and guaranties with respect to each receivable, including any right of stoppage in transit; and

 

v. All of the Company’s Intellectual Property; and

 

  

  

  

vi. All of Company’s equity interest in its Subsidiaries (as defined in the Note) and certificates evidencing such equity interest, and any shares of stock (including, without limitation, a distribution in connection with any reclassification, increase or reduction of capital or in connection with any reorganization), or any option or right to acquire shares of stock, in substitution of, or in exchange for, any of such equity interest, or any stock dividend or split with respect to such equity interest, and any distributions, whether dividend or liquidating or otherwise, of any cash or property with respect to such equity interest; and

 

vii. All of the Company’s documents, instruments and chattel paper, life insurance policies and cash surrender value of the same, files, records, books of account, business papers, computer programs and the products and proceeds of all of the foregoing Collateral set forth in paragraphs (i) through (vi), inclusive, above.

 

b. “Copyrights” shall mean all of the following in which the Company now holds or hereafter acquires any interest (i) all copyrights, whether registered or unregistered, held pursuant to the laws of the United States, any State thereof or any other country; (ii) registrations, applications and recordings in the United States Copyright Office or in any similar office or agency of the United States, any State thereof or any other country; (iii) any continuations, renewals or extensions thereof; (iv) any registrations to be issued in any pending applications; (v) prior versions of works covered by copyright and all works based upon, derived from or incorporating such works; (vi) income, royalties, damages, claims and payments now and hereafter due and/or payable with respect to copyrights, including, without limitation, damages, claims and recoveries for past, present or future infringement; (vii) rights to sue for past, present and future infringements of any copyright; (viii) any rights in any material which is copyrightable or which is protected by common law, United States copyright laws or similar laws, or any law of any State, and (ix) any other rights corresponding to any of the foregoing rights throughout the world.

 

c. “Copyright License” shall mean any agreement, written or oral, in which the Company now holds or hereafter acquires any interest, granting any right in or to any Copyright or Copyright registration (whether the Company is the licensee or the licensor thereunder) including, without limitation, licenses pursuant to which the Company has obtained the exclusive right to use a copyright owned by a third party.

 

d. “Intellectual Property” shall mean, collectively, the Software Intellectual Property, Copyrights, Copyright Licenses, Patents, Patent Licenses, Trademarks, Trademark Licenses and Trade Secrets.

 

e. “Obligations” means all of the Company’s obligations under this Agreement, the Subscription Agreement and the Note, in each case, whether now or hereafter existing, voluntary or involuntary, direct or indirect, absolute or contingent, liquidated or unliquidated, whether or not jointly owed with others, and whether or not from time to time decreased or extinguished and later decreased, created or incurred, and all or any portion of such obligations or liabilities that are paid, to the extent all or any part of such payment is avoided or recovered directly or indirectly from the Secured Parties as a preference, fraudulent transfer or otherwise as such obligations may be amended, supplemented, converted, extended or modified from time to time.

 

f. “Patents” shall mean all of the following in which the Company now holds or hereafter acquires any interest: (i) all patents of the United States or any other country, all registrations and recordings thereof and all applications for patents of the United States or any other country, including, without limitation, registrations, recordings and applications in the United States Patent and Trademark Office or in any similar office or agency of the United States, any State thereof or

 

  

  

  

 any other country; (ii) all reissues, divisions, continuations, renewals, continuations in part or extensions thereof; (iii) all patents to issue in any such applications; (iv) income, royalties, damages, claims and payments now and hereafter due and/or payable with respect to patents, including, without limitation, damages, claims and recoveries for past, present or future infringement; and (v) rights to sue for past, present and future infringements of any patent.

 

g. “Patent License” shall mean any agreement, whether written or oral, in which the Company now holds or hereafter acquires any interest, granting any right with respect to any Patent (whether the Company is the licensee or the licensor thereunder).

 

h. “Software Intellectual Property” shall mean (i) all software programs (including, without limitation, all source code, object code and all related applications and data files), whether now owned, upgraded, enhanced, licensed or leased or hereafter acquired by the Company; (ii) all computers and electronic data processing hardware and firmware associated therewith; (iii) all documentation (including, without limitation, flow charts, logic diagrams, manuals, guides and specifications) with respect to such software, hardware and firmware described in the preceding subclauses (i) and (ii); and (iv) all rights with respect to all of the foregoing, including, without limitation, any and all upgrades, modifications, copyrights, licenses, options, warranties, service contracts, program services, test rights, maintenance rights, support rights, improvement rights, renewal rights and indemnifications and substitutions, replacements, additions, or model conversions of any of the foregoing.

 

i. “Trademarks” shall mean any of the following in which the Company now holds or hereafter acquires any interest: (i) any trademarks, tradenames, corporate names, company names, business names, trade styles, service marks, logos, other source or business identifiers, prints and labels on which any of the foregoing have appeared or appear, designs and general intangibles of like nature, now existing or hereafter adopted or acquired, all registrations and recordings thereof and any applications in connection therewith, including, without limitation, registrations, recordings and applications in the United States Patent and Trademark Office or in any similar office or agency of the United States, any State thereof or any other country (collectively, the “Marks”); (ii) any reissues, extensions or renewals thereof, (iii) the goodwill of the business symbolized by or associated with the Marks, (iv) income, royalties, damages, claims and payments now and hereafter due and/or payable with respect to the Marks, including, without limitation, damages, claims and recoveries for past, present or future infringement and (v) rights to sue for past, present and future infringements of the Marks.

 

j. “Trademark License” shall mean any agreement, written or oral, in which the Company now holds or hereafter acquires any interest, granting any right in and to any Trademark or Trademark registration (whether the Company is the licensee or the licensor thereunder).

 

k. “Trade Secrets” shall mean common law and statutory trade secrets and all other confidential or proprietary or useful information and all know-how obtained by or used in or contemplated at any time for use in the business of the Company (all of the foregoing being collectively called a “Trade Secret”), whether or not such Trade Secret has been reduced to a writing or other tangible form, including, without limitation, all documents and things embodying, incorporating or referring in any way to such Trade Secret, all Trade Secret Licenses, and including, without limitation, the right to sue for and to enjoin and to collect damages for the actual or threatened misappropriation of any Trade Secret and for the breach or enforcement of any such Trade Secret license.

 

l. “UCC” means the Uniform Commercial Code, as the same may, from time to time, be in effect in the State of New York; provided, however, in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection or priority of the Secured Parties’ security interest in any Collateral is governed by the Uniform Commercial Code as in effect in a

 

  

  

  

  jurisdiction other than the State of New York, the term “UCC” shall mean the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such attachment, perfection of priority and for purposes of definitions related to such provisions.

 

2. Grant of Security Interest; Priority.

 

As an inducement for the Secured Parties to enter into the Note and to secure the complete and timely payment, performance and discharge in full of all of the Obligations, the Company hereby, unconditionally and irrevocably, pledges, grants and hypothecates to the Secured Parties, a continuing security interest in, a continuing first lien upon, a right to possession and disposition of, and a right of set-off against, in each case to the fullest extent permitted by law (the “Security Interest”), all of the Company’s right, title and interest of whatsoever kind and nature in and to the Collateral.

 

3. Representations, Warranties, Covenants and Agreements of the Company.  Except as set forth on Schedule A attached hereto, the Company represents and warrants to, and covenants and agrees with, the Secured Parties as follows:

 

a. The Company has the requisite corporate power and authority to enter into this Agreement and otherwise carry out its obligations thereunder.  The execution, delivery and performance by the Company of this Agreement and the filings contemplated therein have been duly authorized by all necessary action on the part of the Company and no further action is required by the Company.  This Agreement constitutes a legal, valid and binding obligation of the Company enforceable in accordance with its terms, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditor’s rights generally.

 

b. The Company represents and warrants that it has no place of business or offices where its respective books of account and records are kept (other than temporarily at the offices of its attorneys or accountants) or places where the Collateral is stored or located.

 

c. The Company is the sole owner of the Collateral (except for non-exclusive licenses granted by the Company in the ordinary course of business), free and clear of any liens, security interests, encumbrances, rights or claims, and is fully authorized to grant the Security Interest in and to pledge the Collateral.  There is not on file in any governmental or regulatory authority, agency or recording office an effective financing statement, security agreement, license or transfer or any notice of any of the foregoing (other than those that have been filed in favor of the Secured Parties pursuant to this Agreement) covering or affecting any of the Collateral.  So long as this Agreement shall be in effect, without the prior consent of the Secured Parties, which consent shall not be unreasonably withheld, the Company shall not execute and shall not knowingly permit to be on file in any such office or agency any such financing statement or other document or instrument (except to the extent filed or recorded in favor of the Secured Parties pursuant to the terms of this Agreement).

 

d. No part of the Collateral or rights in connection therewith has been judged, by any governmental body with proper jurisdiction, to be invalid or unenforceable.  No written claim has been received alleging the Company’s use of any Collateral violates the rights of any third party. There has been no adverse decision to the Company’s claim of ownership rights in or exclusive rights to use the Collateral in any jurisdiction or to the Company’s right to keep and maintain such Collateral in full force and effect, and there is no proceeding involving said rights pending or threatened before any court, judicial body, administrative or regulatory agency, arbitrator or other governmental authority.

 

  

  

  

e. The Company shall at all times maintain its books of account and records relating to the Collateral at its principal place of business and its Collateral at the locations set forth on Schedule A attached hereto.

 

f. This Agreement creates in favor of the Secured Parties a valid security interest in the Collateral securing the payment and performance of the Obligations and, upon making the filings described in the immediately following sentence, a perfected first priority security interest in such Collateral and, to the extent that it can be perfected through such filings, the Intellectual Property.  Except for the filing of financing statements on Form-1 under the UCC with the jurisdictions indicated on Schedule A, attached hereto, no authorization or approval of or filing with or notice to any governmental authority or regulatory body is required either (i) for the grant by the Company of, or the effectiveness of, the Security Interest granted hereby or for the execution, delivery and performance of this Agreement by the Company or (ii) for the perfection of, or exercise by the Secured Parties of, their rights and remedies hereunder.

 

g. Prior to or promptly after the date hereof, the Secured Parties shall file or cause to be filed one or more executed UCC financing statements on Form-1 with respect to the Security Interest with the appropriate jurisdictions.  Furthermore, upon request of the Secured Parties, the Company shall execute and deliver any and all agreements, instruments, documents, and papers as the Secured Parties may reasonably request to evidence the Secured Parties’ security interest in the Intellectual Property and the goodwill and general intangibles of the Company relating thereto or represented thereby.

 

h. The execution, delivery and performance of this Agreement does not conflict with or cause a material breach or default, or an event that with or without the passage of time or notice, shall constitute a material breach or default, under any agreement to which the Company is a party or by which the Company is bound.  No consent (including, without limitation, from stockholders or creditors of the Company) is required for the Company to enter into and perform its obligations hereunder.

 

i. The Company shall at all times safeguard, protect and maintain the Collateral for the account of the Secured Parties until this Agreement and the Security Interest hereunder shall terminate pursuant to Section 12. Without limiting the generality of the foregoing, the Company shall pay all governmental fees and taxes necessary to maintain the Collateral and the Security Interest hereunder, and the Company shall obtain and furnish to the Secured Parties from time to time, upon demand, such releases and/or subordinations of claims and liens which may be required to maintain the priority of the Security Interest hereunder.

 

j. The Company will not transfer, pledge, hypothecate, encumber, license, sell or otherwise dispose of any of the Collateral without the prior written consent of the Secured Parties.

 

k. The Company shall, within ten (10) days of obtaining knowledge thereof, advise the Secured Parties promptly, in sufficient detail, of the occurrence of any event which would have a material adverse effect on the value of the Collateral or on the Secured Parties’ security interest therein.

 

l. The Company shall promptly execute and deliver to the Secured Parties such further deeds, mortgages, assignments, security agreements, financing statements or other instruments, documents, certificates and assurances and take such further action as the Secured Parties may from time to time request and may in its sole discretion deem necessary to perfect, protect or enforce the Security Interest.

 

  

  

  

m. The Company shall permit the Secured Parties and its representatives and agents to inspect the Collateral at any time and to make copies of records pertaining to the Collateral as may be requested by the Secured Parties from time to time.

 

n. The Company will take all steps reasonably necessary to diligently pursue and seek to preserve, enforce and collect any rights, claims, causes of action and accounts receivable in respect of the Collateral.

 

o. The Company shall promptly notify the Secured Parties in sufficient detail upon becoming aware of any attachment, garnishment, execution or other legal process levied against any Collateral and of any other information received by the Company that may materially affect the value of the Collateral, the Security Interest or the rights and remedies of the Secured Parties hereunder.

 

p. All information supplied to the Secured Parties by or on behalf of the Company with respect to the Collateral is accurate and complete in all material respects as of the date hereof, and all information supplied after the date hereof to the Secured Parties shall be accurate in all material respects.

 

q. With respect to any of the Company’s Intellectual Property:

 

i. such Intellectual Property is subsisting and the rights in connection with such Intellectual Property have not been adjudged invalid or unenforceable, in whole or in part;

 

ii. the rights in connection with such Intellectual Property are valid and enforceable;

 

iii. the Company has made all necessary filings and recordations necessary to protect its interest in such Intellectual Property, including, without limitation, recordations of all of its interests in the Patents, Patent Licenses, Trademarks and Trademark Licenses in the United States Patent and Trademark Office and its claims to the Copyrights and Copyright Licenses in the United States Copyright Office;

 

iv. the Company is the exclusive owner of the entire and unencumbered right, title and interest in and to such Intellectual Property and no claim has been made that the use of such Intellectual Property infringes on the asserted rights of any third party; and

 

v. the Company has performed and will continue to perform all acts and has paid all required fees and taxes to maintain its rights with respect to each and every item of Intellectual Property in full force and effect throughout the United States, as applicable.

 

r. Except with respect to any Trademark or Copyright that the Company shall reasonably determine is of negligible economic value to the Company, the Company shall:

 

i. maintain each Trademark and Copyright in full force free from any claim of abandonment for non-use, maintain as in the past the quality of products and services offered under such Trademark or Copyright; employ such Trademark or Copyright with the appropriate notice of registration; not adopt or use any mark which is confusingly similar or a colorable imitation of such Trademark or Copyright unless the Secured Party shall obtain a perfected security interest in such mark

 

  

  

  

 pursuant to this Agreement; and not (and not permit any licensee or sublicensee thereof to) do any act or knowingly omit to do any act whereby any Trademark or Copyright may become invalidated;

 

ii. not, except with respect to any Patent that it shall reasonably determine is of negligible economic value to it, do any act, or omit to do any act, whereby any Patent may become abandoned; and

 

iii. notify the Secured Parties immediately if it knows, or has reason to know, that any application or registration relating to any Patent, Trademark or Copyright may become abandoned, or of any material adverse determination or development (including, without limitation, the institution of, or any such determination or development in, any proceeding in the United States Patent and Trademark Office, the United States Copyright Office or any court or tribunal in the United States) regarding its ownership of any Patent, Trademark or Copyright or its right to register the same or to keep and maintain the same.

 

s. Whenever the Company, either by itself or through any agent, employee, licensee or designee, shall file an application for the registration of any Patent, Trademark or Copyright with the United States Patent and Trademark Office or the United States Copyright Office or acquire rights to any new Patent, Trademark or Copyright whether or not registered, report such filing to the Secured Parties within five (5) business days after the last day of the fiscal quarter in which such filing occurs.

 

t. The Company shall take all reasonable and necessary steps, including, without limitation, in any proceeding before the United States Patent and Trademark Office or the United States Copyright Office, to maintain and pursue each application (and to obtain the relevant registration) and to maintain each registration of the Patents, Trademarks and Copyrights, including, without limitation, filing of applications for renewal, affidavits of use and affidavits of incontestability.

 

u. In the event that any Patent, Trademark or Copyright included in the Intellectual Property is infringed, misappropriated or diluted by a third party, the Company shall promptly notify the Secured Parties after it learns thereof and shall, unless it shall reasonably determine that such Patent, Trademark or Copyright is of negligible economic value to it, which determination it shall promptly report to the Secured Parties: promptly sue for infringement, misappropriation or dilution, to seek injunctive relief where appropriate and to recover any and all damages for such infringement, misappropriation or dilution, or take such other actions as it shall reasonably deem appropriate under the circumstances to protect such Patent, Trademark or Copyright.  If the Company lacks the financial resources to comply with this Section 3(v), the Company shall so notify the Secured Parties and shall cooperate fully with any enforcement action undertaken by the Secured Parties on behalf of the Company.

 

v. None of such Patents, Trademarks, Copyrights and Trade Secrets is the subject of any licensing or franchise agreement as of the date of this Agreement.  No holding, decision or judgment has been rendered by any governmental authority which would limit, cancel or question the validity of any License, Patent, Trademark, Copyright and Trade Secrets.  No action or proceeding is pending (i) seeking to limit, cancel or question the validity of any License, Patent, Trademark, Copyright or Trade Secret, or (ii) which, if adversely determined, would have a material adverse effect on the value of any License, Patent, Trademark, Copyright or Trade Secret.  The Company has used and will continue to use for the duration of this Agreement, proper statutory notice in connection with its use of the Patents, Trademarks and Copyrights and consistent standards of quality in products leased or sold under the Patents, Trademarks and Copyrights.

 

  

  

  

 

4. Defaults.  The following events shall be “Events of Default”:

 

a. The occurrence of an Event of Default as defined in the Note;

 

b. If any representation or warranty of the Company in this Agreement proves to be incorrect in any material respect when made; and

 

c. The failure by the Company to observe or perform any of its obligations hereunder for three (3) business days after receipt by the Company of notice of such failure from a Secured Party.

 

5. Duty To Hold In Trust.  Upon the occurrence of an Event of Default, and at any time thereafter, the Company shall, upon receipt by it of any revenue, income or other sums subject to the Security Interest, whether payable pursuant to the Note or otherwise, or of any check, draft, note, trade acceptance or other instrument evidencing an obligation to pay any such sum, hold the same in trust for the Secured Parties and shall forthwith endorse and transfer any such sums or instruments, or both, to the Secured Parties for application to the satisfaction of the Obligations.

 

6. Rights and Remedies Upon Default.  Upon occurrence and continuance of any Event of Default and at any time thereafter, upon the approval and request from the Secured Parties of at least a majority of the aggregate Principal Amount of the Note then outstanding, the Secured Parties shall have the right to exercise all of the remedies conferred to the Secured Parties hereunder and under the Note, and the Secured Parties shall have all the rights and remedies of a secured party under the UCC and/or any other applicable law (including the Uniform Commercial Code of any jurisdiction in which any Collateral is then subject).  Without limitation, the Secured Parties shall have the following rights and powers:

 

a. to have a third party custodian take possession of the Collateral and, for that purpose, enter, with the aid and assistance of any person, any premises where the Collateral, or any part thereof, is or may be placed and remove the same, and the Company shall assemble the Collateral and make it available to the Secured Parties for the benefit of the Secured Parties at places which the Secured Parties shall reasonably select, whether at the Company’s premises or elsewhere, and make available to the Secured Parties, without rent, all of the Company’s respective premises and facilities for the purpose of the Secured Parties taking possession of, removing or putting the Collateral in saleable or disposable form; and

 

b. to operate the business of the Company using the Collateral and shall have the right to assign, sell, lease or otherwise dispose of and deliver all or any part of the Collateral, at public or private sale or otherwise, either with or without special conditions or stipulations, for cash or on credit or for future delivery, in such parcel or parcels and at such time or times and at such place or places, and upon such terms and conditions as the Secured Parties may deem commercially reasonable, all without (except as shall be required by applicable statute and cannot be waived) advertisement or demand upon or notice to the Company or right of redemption of the Company, which are hereby expressly waived.  Upon each such sale, lease, assignment or other transfer of Collateral, the Secured Parties may, unless prohibited by applicable law which cannot be waived, purchase all or any part of the Collateral being sold, free from and discharged of all trusts, claims, right of redemption and equities of the Company, which are hereby waived and released.

 

  

  

  

7. Indemnification of the Secured Parties.  Neither the Secured Parties nor any of its affiliates or representatives will be liable for any action taken or omitted to be taken by it or them under this Agreement in good faith and believed by it or them to be within the discretion or power conferred upon it or them by this Agreement or be responsible for the consequences of any error of judgment (except for fraud, gross negligence, or willful misconduct).  The Company shall indemnify the Secured Parties and its representatives and hold them harmless from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, reasonable expenses, and reasonable disbursements of any kind or nature whatsoever that may be imposed on, asserted against, or incurred by them in any way relating to or arising out of this Agreement or any action taken or omitted by them under this Agreement.

 

8. Applications of Proceeds.  The proceeds of any such sale, lease or other disposition of the Collateral hereunder shall be applied first, to the expenses of retaking, holding, storing, processing and preparing for sale, selling, and the like (including, without limitation, any taxes, fees and other costs incurred in connection therewith) of the Collateral, to the reasonable attorneys’ fees and expenses incurred by the Secured Parties in enforcing their rights hereunder and in connection with collecting, storing and disposing of the Collateral, and then to satisfaction of the Obligations on a pro rata basis based on the Principal Amount of each Secured Parties’ Note at the time of the default, and to the payment of any other amounts required by applicable law, after which the Secured Parties shall pay to the Company any surplus proceeds.  If, upon the sale, license or other disposition of the Collateral, the proceeds thereof are insufficient to pay all amounts to which the Secured Parties are legally entitled, then the Company will be liable for the deficiency, together with interest thereon, plus interest at the Default Rate as set forth in the Note, and the reasonable fees of any attorneys employed by the Secured Parties to collect such deficiency.  To the extent permitted by applicable law, the Company waives all claims, damages and demands against the Secured Parties arising out of the repossession, removal, retention or sale of the Collateral.

 

9. Costs and Expenses.                                           The Company agrees to pay all out-of-pocket fees, costs and expenses incurred in connection with any filing required hereunder, including without limitation, any financing statements, continuation statements, partial releases and/or termination statements related thereto or any expenses of any searches reasonably required by the Secured Parties.  The Company shall also pay all other claims and charges which would reasonably be expected to prejudice, imperil or otherwise affect the Collateral or the Security Interest therein.  Upon the occurrence and continuance of an Event of Default, the Company shall upon demand, pay to the Secured Parties the amount of any and all reasonable expenses, including the reasonable fees and expenses of its counsel and of any experts and agents, which the Secured Parties incurs in connection with (a) the enforcement of this Agreement, (b) the custody or preservation of, or the sale of, collection from, or other realization upon, any of the Collateral, or (c) the exercise or enforcement of any of the rights of the Secured Parties under the Note, including, without limitation, costs of collection.  Until so paid, any fees payable hereunder shall be added to the principal amount of the Note and shall bear interest as set forth in the Note.

 

10. Responsibility for Collateral.  The Company assumes all liabilities and responsibility in connection with all Collateral, and the obligations of the Company hereunder or under the Note shall in no way be affected or diminished by reason of the loss, destruction, damage or theft of any of the Collateral or its unavailability for any reason.

 

11. Security Interest Absolute.  All rights of the Secured Parties and all Obligations of the Company hereunder, shall be absolute and unconditional, regardless of: (a) any change in the time, manner or place of payment or performance of, or in any other term of, all or any of the Obligations, or

 

  

  

  

 any other amendment or waiver of or any consent to any departure from the Note or any other agreement entered into in connection with the foregoing; (b) any exchange, release or nonperfection of any of the Collateral, or any release or amendment or waiver of or consent to departure from any other collateral for, or any guaranty, or any other security, for all or any of the Obligations; or (c) any action by the Secured Parties to obtain, adjust, settle and cancel in its sole discretion any insurance claims or matters made or arising in connection with the Collateral.  The Company expressly waives presentment, protest and notice of protest.  In the event that at any time any transfer of any Collateral or any payment received by the Secured Parties hereunder shall be deemed by final order of a court of competent jurisdiction to have been a voidable preference or fraudulent conveyance under the bankruptcy or insolvency laws of the United States, or shall be deemed to be otherwise due to any party other than the Secured Parties, then, in any such event, the Company’s obligations hereunder shall survive cancellation of this Agreement, and shall not be discharged or satisfied by any prior payment thereof and/or cancellation of this Agreement, but shall remain a valid and binding obligation enforceable in accordance with the terms and provisions hereof.  The Company waives all right to require the Secured Parties to proceed against any other person or to apply any Collateral which the Secured Parties may hold at any time, or to marshal assets, or to pursue any other remedy.

 

12. Term of Agreement.  This Agreement and the Security Interest shall terminate on the date on which all payments under the Note have been indefeasibly made in full and all other Obligations have been indefeasibly paid.

 

13. Power of Attorney; Further Assurances.

 

a. The Company authorizes the Secured Parties, and does hereby make, constitute and appoint it, and its respective officers, agents, successors or assigns with full power of substitution, as the Company’s true and lawful attorney-in-fact, with power, in its own name or in the name of the Company, to, after the occurrence and during the continuance of an Event of Default, (i) endorse any notes, checks, drafts, money orders, or other instruments of payment (including, without limitation, payments payable under or in respect of any policy of insurance) in respect of the Collateral that may come into possession of the Secured Parties; (ii) to sign and endorse any UCC financing statement or any invoice, freight or express bill, bill of lading, storage or warehouse receipts, drafts against debtors, assignments, verifications and notices in connection with accounts, and other documents relating to the Collateral; (iii) to pay or discharge taxes, liens, security interests or other encumbrances at any time levied or placed on or threatened against the Collateral; (iv) to demand, collect, receipt for, compromise, settle and sue for monies due in respect of the Collateral; and (v) generally, to do, at the option of the Secured Parties, and at the Company’s expense, at any time, or from time to time, all acts and things which the Secured Parties deem necessary to protect, preserve and realize upon the Collateral and the Security Interest granted therein in order to effect the intent of this Agreement and the Note, all as fully and effectually as the Company might or could do; and the Company hereby ratifies all that said attorney shall lawfully do or cause to be done by virtue hereof.  This power of attorney is coupled with an interest and shall be irrevocable for the term of this Agreement and thereafter as long as any of the Obligations shall be outstanding.

 

b. On a continuing basis, the Company will cooperate in good faith with the Secured Parties to make, execute, acknowledge, deliver, file and record, as the case may be, in the proper filing and recording places in any applicable jurisdiction, all such instruments, and take all such action as may reasonably be deemed necessary or advisable, or as reasonably requested by the Secured Parties, to perfect the Security Interest granted hereunder and otherwise to carry out the intent and purposes of this Agreement, or for assuring and confirming to the Secured Parties the grant or perfection of a security interest in all the Collateral.

 

  

  

  

c. The Company hereby irrevocably appoints the Secured Parties as the Company’s attorney-in-fact, with full authority in the place and stead of the Company and in the name of the Company, from time to time in the Secured Parties’ discretion, to take any action and to execute any instrument which the Secured Parties may deem necessary or advisable in order to perfect the Security Interest, including the filing, in its sole discretion, of one or more financing or continuation statements and amendments thereto, relative to any of the Collateral without the signature of the Company where permitted by law.

 

14. Notices.  All notices, requests, demands and other communications hereunder shall be in writing, with copies to all the other parties hereto, and shall be deemed to have been duly given (i) if delivered by hand, (ii) upon receipt of proof of sending thereof if sent by facsimile, (iii) upon receipt if sent by nationally recognized overnight delivery service (receipt requested), the next business day, or (iv) if mailed by first-class registered or certified mail, return receipt requested, postage prepaid, four days after posting in the U.S. mails, in each case if delivered to the following addresses: (A)  if to the Company, to the address set forth immediately below the Company’s name on the signature pages hereto; and (B) if to the Investor, to the address set forth immediately below the Investor’s name on the signature pages hereto.  Each party shall provide notice to all of the other parties of any change in address.

 

15. Other Security.  To the extent that the Obligations are now or hereafter secured by property other than the Collateral or by the guarantee, endorsement or property of any other person, firm, corporation or other entity, then the Secured Parties shall have the right, in its sole discretion, to pursue, relinquish, subordinate, modify or take any other action with respect thereto, without in any way modifying or affecting any of the Secured Parties’ rights and remedies hereunder.

 

16. Miscellaneous.

 

a. No course of dealing between the Company and the Secured Parties, nor any failure to exercise, nor any delay in exercising, on the part of the Secured Parties, any right, power or privilege hereunder or under the Note shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder or thereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege.

 

b. All of the rights and remedies of the Secured Parties with respect to the Collateral, whether established hereby or by the Note or by any other agreements, instruments or documents or by law shall be cumulative and may be exercised singly or concurrently.

 

c. This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof and is intended to supersede all prior negotiations, understandings and agreements with respect thereto, including the prior Agreement.  Any term of this Agreement may be terminated or amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) only with written consent of the Company and the holders of more than fifty percent (50%) of the then-outstanding principal amount of the Note.  Any termination, amendment or waiver effected in accordance with this paragraph shall be binding upon each holder of the Note, each future holder of the Note, their successors and assigns, and the Company.

 

d. In the event that any provision of this Agreement is held to be invalid, prohibited or unenforceable in any jurisdiction for any reason, unless such provision is narrowed by judicial construction, this Agreement shall, as to such jurisdiction, be construed as if such invalid, prohibited or unenforceable provision had been more narrowly drawn so as not to be invalid, prohibited

 

  

  

  

 or unenforceable.  If, notwithstanding the foregoing, any provision of this Agreement is held to be invalid, prohibited or unenforceable in any jurisdiction, such provision, as to such jurisdiction, shall be ineffective to the extent of such invalidity, prohibition or unenforceability without invalidating the remaining portion of such provision or the other provisions of this Agreement and without affecting the validity or enforceability of such provision or the other provisions of this Agreement in any other jurisdiction.

 

e. No waiver of any breach or default or any right under this Agreement shall be considered valid unless in writing and signed by the party giving such waiver, and no such waiver shall be deemed a waiver of any subsequent breach or default or right, whether of the same or similar nature or otherwise.

 

f. This Agreement shall be binding upon and inure to the benefit of each party hereto and its successors and assigns.

 

g. Each party shall take such further action and execute and deliver such further documents as may be necessary or appropriate in order to carry out the provisions and purposes of this Agreement.

 

h. The validity and interpretation of this Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of New York.  Each of the parties hereto hereby consents to the exclusive jurisdiction and venue of the Courts of the State of New York, located in the City and County of New York and the United States District Court, Southern District, for the State of New York with respect to any matter relating to this Agreement and performance of the parties’ obligations hereunder, the documents and instruments executed and delivered concurrently herewith or pursuant hereto and performance of the parties’ obligations thereunder and each of the parties hereto hereby consents to the personal jurisdiction of such courts and shall subject itself to such personal jurisdiction.  Any action, suit or proceeding relating to such matters shall be commenced, pursued, defended and resolved only in such courts and any appropriate appellate court having jurisdiction to hear an appeal from any judgment entered in such courts.  The parties irrevocably waive the defense of an inconvenient forum to the maintenance of such suit or proceeding.  Service of process in any action, suit or proceeding relating to such matters may be made and served within or outside the State of New York by registered or certified mail to the parties and their representatives at their respective addresses specified in Section 14 hereof, provided that a reasonable time, not less than thirty (30) days, is allowed for response.  Service of process may also be made in such other manner as may be permissible under the applicable court rules.

 

i. Each party hereto hereby agrees to waive its respective rights to a jury trial of any claim or cause of action based upon or arising out of this Agreement.  The scope of this waiver is intended to be all encompassing of any disputes that may be filed in any court and that relate to the subject mater of this Agreement, including without limitation contract claims, tort claims, breach of duty claims and all other common law and statutory claims.  Each party hereto acknowledges that this waiver is a material inducement for each party to enter into a business relationship, that each party has relied on this waiver in entering into this Agreement and that each party will continue to rely on this waiver in their related future dealings.  Each party further warrants and represents that it has reviewed this waiver with its legal counsel, and that such party has knowingly and voluntarily waives its rights to a jury trial following such consultation.  This waiver is irrevocable, meaning that, notwithstanding anything herein to the contrary, it may not be modified either orally or in writing, and this waiver shall apply to any subsequent amendments, renewals and supplements or modifications to this agreement.  In the event of litigation, this Agreement may be filed as a written consent to a trial by the court.

 

  

  

  

17. Counterparts.  This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument.

 

18. Facsimile Signature.  In the event that any signature is delivered by facsimile transmission, PDF, electronic signature or other similar electronic means, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) with the same force and effect as if such signature page were an original thereof.

 

IN WITNESS WHEREOF, the parties hereto have caused this Security Agreement to be duly executed on the day and year first above written.

 

COMPANY:

 

GREENHOUSE HOLDINGS, INC.

By:           __/s/  John Galt____________________________________

Name:           John Galt

Title:           President

Notices:                      If to the Company:

Greenhouse Holdings, Inc.

Attn: John Galt

5171 Santa Fe Street, Suite J

San Diego, California  92109

Telephone: (858) 258-2626

Facsimile: (949) 315-3827

If to the Secured Party

Premier Aliance Group, Inc..

4521 Sharon Road

Suite 300

Charlotte, North Carolina 28211

Telephone:                                

Facsimile:

[Signature Page to Security Agreement]

  

  

  

ACKNOWLEDGEMENT

STATE OF _California_______________________                                                                                     )

 

 

COUNTY OF San Diego______________________                                                                                     )

 

On the ___ day of March, 2012, before me, the undersigned, a notary public in and for such state, personally appeared John Galt, personally known to me or proved to me on the basis of satisfactory evidence to be the individual whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his capacity as an executive officer on behalf of GreenHouse Holdings, Inc. and that by his signature on the instrument, he executed the instrument, and that he make such appearance before the undersigned.

 

 

 

 

__________________________________

 

Notary Public

 

[Acknowledgement Page to Security Agreement]

  

  

  

ADDITIONAL SIGNATURE PAGES TO SECURITY AGREEMENT

SECURED PARTY:

By:           __/s/  Mark Elliott____________________________________

Name:           Mark Elliott

Title:           President and Chief Executive Officer

Premier Alliance Group, Inc.

4521 Sharon Road, Suite 300

Charlotte, NC 28211

	
  

	
Notices:

  

  

  

SCHEDULE A

 

Principal Place of Business of the Company:

San Diego, California

Los Angeles, California

___________, Mexico

___________, North Carolina

Locations Where Collateral is Located or Stored:

Same as above.EX-10.1

[LETTERHEAD]

March 27, 2012

Re: 2012 Performance Unit Grant

Dear—:

Exide Technologies (the “Company”) is pleased to inform you that, pursuant to the Company’s 2009
Stock Incentive Plan (the “Plan”), you have been granted        Performance Units (“Performance
Units”) by the Compensation Committee (“Committee”) of the Board of Directors (the “Board”) as of
the date hereof, with each such Performance Unit being equal in value to $1.00. You will receive
separate award agreements for any restricted stock or restricted stock unit awards that you have
also been granted as of the same date.

This award letter (this “Agreement”) sets forth the terms of the Performance Units. However,
please note that the Performance Units are also subject to the terms of the Plan, as interpreted by
the Committee in its full discretion. Furthermore, this Agreement in no way guarantees that you
will receive any payment pursuant to the Performance Units under the Plan. Any terms not defined
in this Agreement will have the meaning ascribed to them in the Plan. The Performance Units are
intended to constitute qualified performance-based compensation under Section 162(m) of the
Internal Revenue Code of 1986, as amended (the “Code”).

General Terms

Your right to receive a cash payment pursuant to the Performance Units is contingent upon the
achievement of certain Management Objectives, which are described in detail below. The achievement
of the Management Objectives will be measured during the period from April 1, 2012 through March
31, 2015 (the “Performance Period”).

Management Objective

The Management Objectives for the Performance Period are based on the achievement of performance
goals relating to (i) the Company’s operating income (“OI”) (as defined below) for the Performance
Period (the “OI Performance Metric”), and (ii) relative total shareholder return for the
Performance Period (“Relative TSR Performance Metric”) (collectively, the “Performance Metrics”).

As further described below, if minimum thresholds are met with respect to both of the Performance
Metrics, you will receive a cash payment in U.S. dollars pursuant to at least a portion of the
Performance Units. Fifty percent (50%) of the Performance Units will be subject to the OI
Performance Metric and the remaining fifty-percent (50%) of the Performance Units will be subject
to the Relative TSR Performance Metric.

If the Committee determines that a change in the business, operations, corporate structure or
capital structure of the Company, the manner in which it conducts business, or other events or
circumstances render the Management Objective to be unsuitable, the Committee may modify the
Management Objective or the related levels of achievement, in whole or in part, as the Committee
deems appropriate; provided, however, that no such action will be made in the case
of a Covered Employee where such action may result in the loss of the otherwise available exemption
of the award under Section 162(m) of the Code.

Payment of Performance Units

You will receive a cash payment pursuant to the Performance Units for the Performance Period only
if payment is otherwise permitted under the terms of the Plan and the Board (or Committee, in the
case of Covered Employees) has certified that the Management Objectives have been satisfied. You
will receive any cash payment pursuant to the Performance Units that you have earned under this
Agreement within 90 days after March 31, 2015 (the “Payment Date”), unless your Continuous Service
with the Company or one of its subsidiaries terminates on account of your death or disability or in
connection with a Change in Control prior to the end of the Performance Period, in which such case
you will receive payment, if any, in accordance with the terms set forth below under the heading
“Effect of Early Termination on the Performance Units.”

Earning of Performance Units—Operating Income

Provided that you remain in Continuous Service through the end of the Performance Period, the
actual number of Performance Units that you will earn at the end of the Performance Period that are
attributable to the OI Performance Metric will be determined in accordance with the performance
matrix set forth on Exhibit A to this Agreement. Pursuant to the matrix, you will receive
up to 150% of your Performance Units that are attributable to the OI Performance Metric at the end
of the Performance Period if the OI at the end of the Performance Period equals or exceeds the
threshold amount ($      ) (the “OI Threshold Amount”) as set forth on Exhibit A. If the
OI at the end of the Performance Period is greater than the OI Threshold Amount, but less than the
target amount (the “OI Target Amount”) and is not expressly stated on Exhibit A, then each
additional $      improvement in performance will result in approximately a      % increase in the
number of Performance Units earned above the OI Threshold Amount until the OI Target Amount is
reached. If the OI at the end of the Performance Period is greater than the OI Target Amount, but
less than the maximum amount ($      ) (the “OI Maximum Amount”) and is not expressly stated on
Exhibit A, then each additional $      improvement in performance will result in
approximately a       % increase in the number of Performance Units earned above the OI Target Amount
until the OI Maximum Amount is reached. No additional Performance Units will be earned if
performance exceeds the OI Maximum Amount.

For purposes of this award, OI is defined as net sales of the Company less the sum of cost of
sales, selling and administrative expenses and restructuring and impairment charges, and excluding
the impact of currency exchange.

Earning of Performance Units – Relative TSR 

Provided that the OI Trigger, which is defined as $        in net sales of the Company reduced by
cost of sales, restructuring and impairment charges and further reduced by the sum of all selling,
administrative and research, development and engineering expenses and excluding foreign currency
translation (the “OI Trigger”), has been achieved at the end of the Performance Period and you
remain in Continuous Service through the end of the Performance Period, the actual number of
Performance Units that you will earn at the end of the Performance Period that are attributable to
the Relative TSR Performance Metric will be determined in accordance with the performance matrix
set forth on Exhibit B to this Agreement. Pursuant to the matrix, you will receive up to
150% of your Performance Units that are attributable to the Relative TSR Performance Metric at the
end of the Performance Period if the Relative TSR at the end of the Performance Period equals or
exceeds the threshold amount (25th percentile) (the “Relative TSR Threshold Amount”) as
set forth on Exhibit B. If the Relative TSR at the end of the Performance Period is
greater than the Relative TSR Threshold Amount, but less than the target amount (50th
percentile) (the “Relative TSR Target Amount”) and is not expressly stated on Exhibit B, then each
whole 1% improvement in performance will result in approximately a 3% increase in the number of
Performance Units earned above the Relative TSR Threshold Amount until the Relative TSR Target
Amount is reached. If the Relative TSR at the end of the Performance Period is greater than the
Relative TSR Target Amount, but less than the maximum amount (75th percentile) (the
“Relative TSR Maximum Amount”) and is not expressly stated on Exhibit B, then each whole 1%
improvement in performance will result in approximately a 2% increase in the number of Performance
Units earned above the Relative TSR Target Amount until the Relative TSR Maximum Amount is reached.
No additional Performance Units will be earned if performance exceeds the Relative TSR Target
Amount. Furthermore, if the OI Trigger is not achieved at the end of the Performance Period, you
will not receive any Performance Units under the Relative TSR Performance Metric.

For purposes of this award, Relative TSR will be based on the difference between the Beginning
Stock Price (as defined below) and the Ending Stock Price (as defined below) relative to the
performance of the Russell 2000®, plus the amount per share of any cash dividends paid
by the Company during the Performance Period. The term “Beginning Stock Price” means the average
closing price of a share of the Company’s Common Stock for the 20 consecutive trading days
immediately preceding, but not including, April 1, 2012 as reported by the online edition of The
Wall Street Journal on the NASDAQ Global Market, or as reported by such other source as the
Committee may approve. The term “Ending Stock Price” means the average closing price of a share of
the Company’s Common Stock for the 20 consecutive trading days immediately preceding, but not
including, the last day of the Performance Period as reported by the online edition of The Wall
Street Journal on the NASDAQ Global Market, or as reported by such other source as the Committee
may approve.

Effect of Early Termination on the Performance Units

Death

If your Continuous Service terminates early on account of your death prior to the end of the
Performance Period, the amount of the cash payment that your beneficiary will receive pursuant to
the Performance Units, if any, will be determined in accordance with Exhibits A and B
attached hereto and will be paid to your designated beneficiary on the Payment Date. However, the
amount of the cash payment will be pro-rated for the period starting on the date hereof and ending
on the last day of the month in which your Continuous Service is terminated on account of your
death.

Disability

If your Continuous Service terminates early on account of your disability prior to the end of the
Performance Period, the amount of the cash payment that you will receive pursuant to the
Performance Units, if any, will be determined in accordance with Exhibits A and B attached
hereto and will be paid on the Payment Date. However, the amount of the cash payment will be
pro-rated for the period starting on the date hereof and ending on the last day of the month in
which your Continuous Service is terminated on account of your disability.

Change in Control

In the event your Continuous Service is terminated by the Company for any reason other than Cause
or by you for Good Reason (as defined below) on or within twelve (12) months after a Change in
Control, the amount of the cash payment that you will receive pursuant to the Performance Units, if
any, will be determined in accordance with Exhibits A and B attached hereto. However, in
order to determine the number of Performance Units earned pursuant to both Performance Metrics, the
Performance Metrics will be measured as of the last day of the month in which your Continuous
Service is terminated in connection with the Change in Control instead of the last day of the
Performance Period. Any Performance Units earned on the date your Continuous Service is terminated
in connection with a Change in Control will be delivered as soon as practicable, and in all events
within 30 days, following the date your Continuous Service is terminated in connection with a
Change in Control; provided, however, that if the termination of Continuous Service
is not a “separation of service” as defined under Section 409A of the Code, payment will be made to
you within 30 days following the earlier of (i) the Payment Date or (ii) the date of your
“separation of service” with the Company (determined in accordance with Section 409A of the Code);
further, provided, that if the date of payment is determined by reference to the date of your
“separation of service” with the Company (determined in accordance with Section 409A of the Code)
or the Change in Control does not constitute a change in ownership or effective control of the
Company or a change in the ownership of a substantial portion of the Company, within the meaning of
Section 409A of the Code, and you are considered a “specified employee” for the purposes of Section
409A of the Code, payment will be made within 30 days of the first business day of the seventh
month after the date of your “separation of service” with the Company (determined in accordance
with Section 409A of the Code).

For purposes of this Agreement, the term “Good Reason” shall mean (i) a material diminution in your
authority, duties or responsibilities, (ii) a relocation of the office at which you provide
services to the Company or a Subsidiary to a location more than fifty (50) miles from its current
location; or (iii) any material breach of an employment agreement, if any, that is in effect at any
time between you and the Company.

Before a termination will constitute a termination for Good Reason, you must give the Company a
Notice of Good Reason within ninety (90) calendar days following the occurrence of the event that
constitutes Good Reason. Failure to provide such Notice of Good Reason within such 90-day period
shall be conclusive proof that you shall not have Good Reason to terminate employment.

Good Reason shall exist only if (A) the Company fails to remedy the event or events constituting
Good Reason within thirty (30) calendar days after receipt of the Notice of Good Reason from you
and (B) you terminate you employment within sixty (60) days after the end of the period set forth
in clause (A) above. If you determine that Good Reason for termination exists and timely file a
Notice of Good Reason, such determination shall be presumed to be true and the Company will have
the burden of proving that Good Reason does not exist.

For purposes of this Agreement, “Notice of Good Reason” means a written notice by you to the
Company which sets forth in reasonable detail the specific reason for a termination of employment
for Good Reason and the facts and circumstances claimed to provide a basis for such termination and
is provided to the Company in accordance with the terms set forth above.

Other Terminations

If your Continuous Service with the Company or any subsidiary is voluntarily or involuntarily
terminated during the Performance Period for any reason other than your death or disability, or in
connection with a Change in Control, you will forfeit your entire Performance Unit Award.

If there is a conflict between these termination provisions and the termination provisions of the
Plan, the terms of the Plan shall govern.

Taxes and Withholding

To the extent that the Company is required to withhold any federal, state, local or foreign taxes
in connection with any cash payment made pursuant to the Performance Units, the Company shall
withhold such amounts from such payment.

Please contact        at extension        if you have any questions about the Plan or the
Program.

Very truly yours,

      

By:

The undersigned hereby accepts the terms of this Award Agreement

and the Plan.

Address:

1

Exhibit A

Performance Units Earned — OI

	 	 	 	 	 
	OI	 	% of Award Earned
	Less than $ million
	 	 	0	%
	 
	 	 	 	 
	$     
	 	 	50	%
	 
	 	 	 	 
	$     
	 	 	62.5	%
	 
	 	 	 	 
	$     
	 	 	75	%
	 
	 	 	 	 
	$     
	 	 	87.5	%
	 
	 	 	 	 
	$ million
	 	 	100	%
	 
	 	 	 	 
	$     
	 	 	112.5	%
	 
	 	 	 	 
	$     
	 	 	125	%
	 
	 	 	 	 
	$     
	 	 	137.5	%
	 
	 	 	 	 
	$ million or greater
	 	 	150	%
	 
	 	 	 	 

2

Exhibit B

Performance Units Earned – Relative TSR

	 	 	 	 	 
	Percentile Rank Relative to Russell 2000®
	 	% of Award Earned
	 
	 	 	 	 
	Less than 25
	 	 	0	%
	 
	 	 	 	 
	25
	 	 	25	%
	 
	 	 	 	 
	30
	 	 	40	%
	 
	 	 	 	 
	35
	 	 	55	%
	 
	 	 	 	 
	40
	 	 	70	%
	 
	 	 	 	 
	45
	 	 	85	%
	 
	 	 	 	 
	50
	 	 	100	%
	 
	 	 	 	 
	55
	 	 	110	%
	 
	 	 	 	 
	60
	 	 	120	%
	 
	 	 	 	 
	65
	 	 	130	%
	 
	 	 	 	 
	70
	 	 	140	%
	 
	 	 	 	 
	75 or greater
	 	 	150	%
	 
	 	 	 	 

3

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