Document:

ex_194649.htm

Exhibit 10.1

 

NATURAL ALTERNATIVES INTERNATIONAL, INC.

NON-QUALIFIED INCENTIVE PLAN

 

1.     Establishment of Plan. Natural Alternatives International, Inc. (the “Company”) hereby adopts and establishes this, the Natural Alternatives International, Inc. Non-Qualified Incentive Plan (the “Plan”), which is an unfunded incentive plan for certain designated Directors, Employees, and Service Providers who provide services to the Company.

 

2.     Purpose of Plan. The purpose of the Plan is to provide the Company with a means of attracting and retaining highly qualified Directors, Employees, and Service Providers and aligning the interests of those individuals receiving an Award hereunder with the financial success of the Company. The Plan is not intended to be governed by ERISA as an “employee welfare benefit plan” or an “employee pension benefit plan.”

 

3.     Definitions.

 

(a)     “Account” means a bookkeeping account established in the name of each Participant and maintained by the Company to reflect the fair market value of an Award to the Participant.

 

(b)     “Award” means an unfunded, unsecured promise by the Company to pay to a Participant an amount equal to the vested Award, including earnings or losses thereon, if any, subject to the terms and conditions of this Plan, such amount being set forth in an Award Agreement.

 

(c)     “Award Agreement” means a written agreement between the Company and a Participant that specifies the amount of the Award to the Participant, the terms of the Award and any additional terms as determined by the Committee or the Board.

 

(d)     “Award Value” means the fair market value of Award at the Measurement Date, as determined by the Board, considering such factors as it considers appropriate. The Award Value shall be determined by the Board on the Measurement Date. Notwithstanding the foregoing, if a Change in Control occurs, the Award Value shall be equal to the total value of the Award as if any vesting condition set forth in the Award Agreement had been fulfilled.

 

(e)     “Beneficiary” means any person or entity, designated in accordance with Section 11.7, who is entitled to receive benefits which are payable upon or after a Participant’s death pursuant to the terms of the Plan and the Award Agreement.

 

(f)     “Board” means the Board of Directors of the Company, as constituted from time to time.

 

(g)     “Cause” means, if there is an employment or service agreement between the Participant and the Company and the agreement contains a definition of “Cause,” the definition contained therein; otherwise “Cause” shall mean:

 

(i)     the Participant’s conviction of a felony under Federal law or the law of the state in which such action occurred;

 

(ii)     the Participant’s dishonesty in the course of fulfilling his or her duties on behalf of the Company;

 

 

 

 

(iii)     the Participant’s disclosure of the Company’s trade secrets;

 

(iv)     the Participant’s gross negligence, intentional misconduct or fraud causing or partially causing the Company to have to restate all or a portion of its financial statements;

 

(v)     willful and deliberate failure of the Participant to perform his or her duties on behalf of the Company in any material respect;

 

(vi)     if the Participant’s violation of a confidentiality agreement or similar agreement between the Participant and the Company and any restrictive covenants applicable to the Participant with respect to his or her providing services to the Company; or

 

(vii)     such other events as shall be determined in good faith by the Committee or the Board.

 

The Committee or the Board shall have discretion to determine whether Cause exists in any given case that Cause as defined in this Plan exists, and its determination shall be final and binding on all parties.

 

(h)     “Change in Control” means the occurrence of one person (or more than one person acting as a group) acquiring ownership of the stock of the Company that, together with the Company stock held by such person or group, constitutes more than 50% of the total fair market value or total voting power of the stock of the Company; provided, however, a Change in Control shall not occur if any person (or more than one person acting as a group) owns more than 50% of the total fair market value or total voting power of the Company’s stock and acquires additional Company stock. Notwithstanding the foregoing, a Change in Control:

 

(i)     shall be determined pursuant to any equity compensation plan adopted by the Company and approved by the Company’s shareholders after the effective date of this Plan; and

 

(ii)     if there is “deferred compensation” subject to or excepted from Section 409A of the Code, shall not occur unless such transaction constitutes a Change in Control under Section 409A of the Code.

 

(i)     “Code” means the U.S. Internal Revenue Code of 1986, as amended, or any successor statute, and the Treasury regulations promulgated, and other authoritative guidance issued, thereunder.

 

(j)     “Committee” means the Human Resources Committee of the Board or, if no such Committee exists, the Board. Unless the Board chooses in its sole and absolute discretion, whenever the Committee acts pursuant to the terms of the Plan and any Award Agreement it shall do so in its sole and absolute discretion.

 

(k)     “Company” means Natural Alternatives International, Inc., a Delaware corporation, or its subsidiaries or affiliates, or any successor thereto.

 

(l)     “Director” means a member of the Board of Directors of the Company who is not an Employee.

 

(m)     “Disability” means a condition of a Participant as determined by the Committee or the Board on the basis of such evidence as the Committee or the Board deems warranted in its sole discretion under the circumstances in accordance with applicable law (if any). Notwithstanding the foregoing, for Awards that are subject to or excepted from Section 409A of the Code, Disability shall mean that a Participant is disabled under Section 409A(a)(2)(C)(i) or (ii) of the Code.

 

Natural Alternatives International, Inc.

Non-Qualified Incentive Plan

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(n)     “Distribution Event” means an event the result of which a Participant will be entitled to receive a distribution of all or part of his or her vested Account balance. The Distribution Event shall be set forth in the Award Agreement.

 

(o)     “Effective Date” means July 16, 2020.

 

(p)     “Eligible Individual” means a Director, an Employee, or a Service Provider who is selected by the Committee or the Board to receive an Award pursuant to the Plan.

 

(q)     “Employee” means a common law employee of the Company, but excluding:

 

(i)     any Leased Employee;

 

(ii)     any person on the payroll of a third party with whom the Company has contracted for the provision of such person's services;

 

(iii)     any person who is a nonresident alien and receives no earned income from the Company that constitutes income from sources within the U.S. as defined in Section 410(b)(3)(C) of the Code; and

 

(iv)     any person classified as an independent contractor or consultant by the Company acting in its capacity as the employer, (regardless of the status of the individual for income tax withholding or other purposes) for any period during which he or she is so classified, even if such classification is later changed by a court, administrative agency, or prospectively by the Company.

 

(r)     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.

 

(s)     “Good Reason” means Separation from Service that occurs not more than 90 days following the initial existence of one or more of the following conditions arising without the Participant’s consent and the Company has no less than 30 days to cure one or more of the following conditions:

 

(i)     a material diminution in the Participant’s base compensation;

 

(ii)     a material diminution in the Participant’s authority, duties, or responsibilities;

 

(iii)     a material diminution in the authority, duties, or responsibilities of the supervisor to whom the Participant is required to report, including a requirement that a Participant report to a corporate officer or employee instead of reporting directly to the Board;

 

(iv)     a material diminution in the budget over which the Participant retains authority;

 

(v)     a material change in the geographic location at which the Participant must perform the services and/or

 

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Non-Qualified Incentive Plan

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(vi)     any other action or inaction that constitutes a material breach by the Company of the agreement under which the Participant provides services;

 

provided, however, the amount, time and form of payment made because of a Separation from Service under this subsection is substantially identical to a payment made on an actual involuntary Separation from Service.

 

(t)     “Leased Employee” means any person (other than a common law employee of the Company) who, pursuant to an agreement between the Company and any other person (a "leasing organization"), has performed services for the Company or any related persons determined in accordance with Section 414(n)(6) of the Code on a substantially full-time basis for a period of at least one year and such services are performed under the primary direction of or control by the Company. In the case of any person who is a Leased Employee (or who would qualify as a Leased Employee but for the requirement that substantially full-time service be performed for one year) before or after a period of service as an Employee, the entire period during which he has performed services as a Leased Employee shall be counted as service as an Employee for all purposes of the Plan, except that he shall not, by reason of that status, become a Participant of the Plan.

 

(u)     “Measurement Date” shall mean any date upon which a percent of an Award is valued, the vesting date, the Distribution Event, or such other time as the Committee or the Board shall determine in its sole and absolute discretion.

 

(v)     “Participant” means an Eligible Individual who is selected to participate in the Plan and receives an Award and any former Eligible Individual who continues to be entitled to a benefit under the Plan. An Eligible Individual becomes a Participant upon the Eligible Individual’s acknowledgement, execution, and delivery to the Company of the Award Agreement.

 

(w)     “Payment Date” means the date on which the Participant will receive a distribution of all or part of the Participant’s vested Account, including any earnings thereon, if any, in connection with a Distribution Event as set forth in the Participant’s Award Agreement.

 

(x)     “Plan” means the Natural Alternatives International, Inc. Non-Qualified Incentive Plan, as amended from time to time.

 

(y)     “Separation from Service” means the date upon which the Participant and the Company both anticipate at the time of separation that no further services will be performed for or on behalf of the Company. Notwithstanding the foregoing, a Separation from Service:

 

(i)     shall be determined pursuant to any equity compensation plan adopted by the Company and approved by the Company’s shareholders after the effective date of this Plan; and

 

(ii)     if there is “deferred compensation” subject to or excepted from Section 409A of the Code, shall not occur unless such event constitutes a Separation from Service under Section 409A of the Code.

 

(z)     “Service Provider” means an individual providing services on behalf of the Company as an independent contractor or a consultant and not as a common law employee.

 

(aa)     “Specified Employee” means an Employee who upon his or her Separation from Service is determined by the Committee or the Board or its delegate for purposes of Section 409A of the Code to be a key employee.

 

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Non-Qualified Incentive Plan

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4.     Eligibility; Participation.

 

4.1     Requirements for Participation. The Committee or the Board may select Eligible Individuals for an Award.

 

4.2     Cessation of Participation. If a Participant ceases to be an Eligible Individual, then the Participant shall not receive any further Awards. However, such Participant’s Account may continue to reflect the Award Value until the occurrence of a Distribution Event or until the Account is subject to forfeiture as set forth in Section 7.2 and any other terms of which shall be determined by the Committee or the Board and set forth in the Award Agreement.

 

5.     Availability and Grant.

 

5.1     Grant of Awards.

 

(a)     The Committee or the Board may grant Awards to such Eligible Individuals in such amounts, at such times, and according to such conditions as the Committee or the Board determines.

 

(b)     The Company will not be required to set aside funds for the payment of any Award; provided, however, the Board may elect to set aside funds for the payment of an Award, which may or may not be credited with earnings and losses as the Committee or the Board determines.

 

(c)     At the time and in the manner set forth in the applicable Award Agreement, the distribution in cash shall be payable to the Participant only with respect to a vested Award. If such Award is forfeited, the Participant shall have no right to such distribution.

 

5.2     Award Agreement. Each Award to a Participant shall be evidenced by an Award Agreement, which shall set out the amount of the Award to the Participant and such other terms and conditions as determined by the Committee or the Board.

 

6.     Accounts.

 

6.1     Establishment of Accounts.

 

(a)     The Company shall establish and maintain an Account for each Participant. Each Participant’s Account shall be credited with the amount of any Award awarded pursuant to Section 5.1 and represented in an Award Agreement.

 

(b)     If pursuant to Section 5.1(b), the Board sets aside funds for the payment of any Award, each Award Account for which the Board elects to set aside funds for the payment of any such Award shall reflect such earnings and losses thereon if the Committee or the Board so determines that any Awards will be subject to earnings and losses.

 

6.2     Statements of Account. At such times and intervals as determined by the Committee or the Board, each Participant shall be provided with a statement setting forth the Award Value of his or her Account, which will be inclusive of earnings and losses, if any, in accordance with Section 6.1(b).

 

Natural Alternatives International, Inc.

Non-Qualified Incentive Plan

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7.     Vesting.

 

7.1     Vesting. Participants shall become vested in the Award credited to his or her Account in accordance with the terms of the relevant Award Agreement, subject to the Participant remaining a member of the Board, in active full-time employment, or active service with the Company through the vesting date. Notwithstanding the foregoing, the Committee or the Board may provide in an Award Agreement that a Participant’s Award shall become vested if:

 

(a)     the Participant dies;

 

(b)     the Participant becomes Disabled;

 

(c)     the Participant is terminated without Cause;

 

(d)     the Participant voluntarily terminates with Good Reason; or

 

(e)     there is a Change in Control.

 

7.2     Forfeitures.

 

(a)     Notwithstanding any other provision contained herein, the Participant’s unvested Award shall be forfeited if he or she incurs a Separation from Service for Cause.

 

(b)     Except as provided in Section 7.3 or the underlying Award Agreement, if the Participant incurs a voluntary Separation from Service other than for Good Cause, all unvested Awards granted hereunder shall be forfeited.

 

7.3     Vesting – Discretion. Notwithstanding any other Plan provision contained herein or any provision in an Award Agreement, the Committee or the Board may, in its absolute discretion, accelerate the vesting of a Participant’s Award.

 

8.     Payment of Participant Accounts.

 

8.1     Payment of Vested Accounts. Payment of a Participant’s vested Account shall be made at the time and in the form set forth in the Award Agreement on the Payment Date of the Plan Year in which the Distribution Event occurs. Any payment from a Participant’s Account shall be made in a lump-sum cash amount equal to all or part of the vested Account adjusted for earnings or losses, if any.

 

8.2     Payment Delay.

 

(a)     To the extent permitted by Section 409A of the Code, payments will be delayed if making the payment on the Payment Date would jeopardize the ability of the Company to continue as a going concern. If payment is delayed, payment will be made during the first taxable year in which making the payment would not jeopardize the Company.

 

(b)     For as long as the shares of the Company’s common stock are publicly traded, and if a Participant holding an Award that constitutes “deferred compensation” under Section 409A of the Code is a Specified Employee, no distribution or payment of any amount that is due because of a Separation from Service will be issued or paid before the date that is six (6) months following the date of such Participant’s Separation from Service or, if earlier, the date of the Participant’s death, unless such distribution or payment can be made in a manner that complies with Section 409A of the Code, and any amounts so deferred will be paid as soon as administratively practicable and in accordance with Section 409A of the Code after such six (6) month period elapses. The balance (if any) shall be paid thereafter on the original schedule.

 

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Non-Qualified Incentive Plan

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8.3     Determining Value of Accounts. The value of a Participant’s Account shall be determined as of the applicable Distribution Event and the Participant shall not be entitled to any increases in value thereafter.

 

9.     Plan Administration.

 

9.1     Administration by the Committee or the Board. The Plan shall be administered by the Committee or the Board, which shall have the authority to:

 

(a)     construe and interpret the Plan and apply its provisions;

 

(b)     promulgate, amend, and rescind rules and regulations relating to the administration of the Plan;

 

(c)     authorize any person to execute, on behalf of the Company, any instrument required to carry out the purposes of the Plan;

 

(d)     select, subject to the limitations set forth in the Plan, those Directors, Employees, and Service Providers who shall be Eligible Individuals;

 

(e)     interpret, administer, reconcile any inconsistency in, correct any defect in, and/or supply any omission in the Plan and any instrument or agreement relating to the Plan;

 

(f)     exercise discretion to make any and all other determinations which it determines to be necessary or advisable for the administration of the Plan;

 

(g)     direct the investment of all or part of the Company’s funds set aside to fund the Plan, if any; and

 

(h)     establish investment criteria and appoint and provide for use of investment advisors and investment managers with respect to any of the Company’s funds set aside to fund the Plan, if any.

 

9.2     Non-Uniform Treatment.  The Committee’s or the Board’s determinations under the Plan need not be uniform and any such determinations may be made selectively among Directors, Employees, and Service Providers.

 

9.3     Committee or Board Decisions Final. All decisions made by the Committee or the Board pursuant to the provisions of the Plan shall be final and binding on the Company and the Participants, unless such decisions are determined by a court having jurisdiction to be arbitrary and capricious.

 

9.4     Indemnification. No member of the Committee or the Board or any designee shall be liable for any action, failure to act, determination or interpretation made in good faith with respect to the Plan except for any liability arising from his or her own willful malfeasance, gross negligence, or reckless disregard of his or her duties.

 

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Non-Qualified Incentive Plan

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10.     Amendment and Termination.

 

10.1     Amendment and Termination. The Board may, at any time, and in its sole and absolute discretion, alter, amend, modify, suspend, or terminate the Plan or any portion thereof; provided, however, that no such amendment, modification, suspension, or termination shall, without the consent of a Participant, adversely affect such Participant’s rights with respect to amounts credited to or accrued in his or her Account.

 

10.2      Acceleration – Discretion. The Committee or the Board may accelerate payment of all or a portion of a Participant's vested Account upon termination of the Plan in accordance with Treas. Reg. Section 1.409A-3(j)(4)(ix).

 

11.     Miscellaneous.

 

11.1     No Employment or Other Service Rights. Nothing in the Plan or any instrument executed pursuant thereto shall confer upon any Participant any right to continue to serve the Company or any subsidiary or affiliate of the Company or interfere in any way with the right of the Company or any subsidiary to terminate the Participant’s employment or service at any time with or without notice and with or without cause.

 

11.2     Other Benefits.  Amounts paid under the Plan shall not be considered part of a Participant’s salary or compensation for purposes of determining or calculating other benefits under any other employee benefit plan or program of the Company.

 

11.3     Tax Withholding. The Company shall have the right to deduct from any amounts otherwise payable under the Plan any federal, state, local, or other applicable taxes required to be withheld.

 

11.4     Governing Law; Forum Selection. All questions arising with respect to the provisions of this Plan or an Award Agreement, or both, shall be determined by application of the laws of the State of Delaware, without giving any effect to any conflict of law provisions thereof, except to the extent preempted by Federal law. Any action or proceeding by either party to regarding this Plan or Award Agreement, or both, shall be brought only in any federal court located in the County of San Diego, State of California. The parties hereby irrevocably submit to the exclusive jurisdiction of such courts and waive the defense of inconvenient forum to the maintenance of any such action or proceeding in such venue.

 

11.5     Section 409A of the Code.

 

(a)     The Company intends that the Plan comply with the requirements of Section 409A of the Code and shall be operated and interpreted consistent with that intent. Notwithstanding the foregoing, the Company makes no representation that the Plan complies with Section 409A of the Code and shall have no liability to any Participant for any failure to comply with Section 409A of the Code. Each Participant is fully responsible for any and all taxes or other amounts imposed by Section 409A of the Code.

 

(b)     This Plan shall constitute an “account balance plan” as defined in Treas. Reg. Section 31.3121(v)(2)-1(c)(1)(ii)(A). For purposes of Section 409A of the Code, all amounts deferred under this Plan shall be aggregated with amounts deferred under other account balance plans.

 

Natural Alternatives International, Inc.

Non-Qualified Incentive Plan

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11.6     Unfunded Benefit. All amounts provided under the Plan shall be paid from the general assets of the Company and unless the Board determines otherwise, no separate fund shall be established from which to make payment. To the extent that any person acquires a right to receive payment from the Company under the Plan, such right shall be no greater than the right of any unsecured general creditor of the Company.

 

11.7     Beneficiary Designation. Each Participant under the Plan may from time to time name a Beneficiary or Beneficiaries to receive the Participant’s interest in the Plan in the event of the Participant’s death. Each designation will revoke all prior designations by the same Participant, shall be in a form reasonably prescribed by the Committee or the Board and shall be effective only when filed by the Participant in writing with the Company during the Participant’s lifetime. If a Participant fails to designate a Beneficiary as set forth pursuant to the terms of this Section 11.7, then the Participant’s designated Beneficiary shall be deemed to be the Participant’s estate. Nothing in this Section 11.7 shall be interpreted to suggest a Participant may have a benefit under the Plan following the death of the Participant. All such determinations shall be made pursuant to the Plan and Award Agreement.

 

11.8     No Assignment. Neither a Participant nor any other person shall have any right to sell, assign, transfer, pledge, anticipate, or otherwise encumber, transfer, hypothecate, or convey any amounts payable hereunder prior to the date that such amounts are paid (except for the designation of beneficiaries pursuant to Section 11.7).

 

11.9     Clawback Provisions. If it is determined by the Committee or the Board that gross negligence, intentional misconduct or fraud by a Participant caused or partially caused the Company to have to restate all or a portion of its financial statements, the Committee or the Board, in its absolute discretion, may, to the extent permitted by law, and to the extent it determines in its judgment it is in the best interests of the Company to do so, require repayment of a portion or all of any Award if: (1) the amount of the Award was calculated based upon, or contingent on, the achievement of financial or operating results that were the subject of or affected by the restatement; and (2) the amount of the Award would have been less had the financial statements been correct. The action permitted to be taken by the Committee or the Board under this Section 11.9 is in addition to, and not in lieu of, any and all other rights of the Board and/or the Company under applicable law and shall apply notwithstanding anything to the contrary in the Plan.

 

11.10     Severability. If any provision of the Plan is held to be invalid, illegal or unenforceable, whether in whole or in part, such provision shall be deemed modified to the extent of such invalidity, illegality or unenforceability and the remaining provisions shall not be affected.

 

11.11     Headings and Subheadings. Headings and subheadings in the Plan are for convenience only and are not to be considered in the construction of the provisions hereof.

 

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IN WITNESS WHEREOF, Natural Alternatives International, Inc. has adopted this Plan as of the Effective Date written above.

 

 

 

	
			 

				
			NATURAL ALTERNATIVES

			INTERNATIONAL, INC.

			
	 	 
	 	 
	 	 
	
			 

				
			By: ___/s/ Kenneth E. Wolf________

			
	 	 
	 	 Kenneth E. Wolf, President

 

Natural Alternatives International, Inc.

Non-Qualified Incentive Plan

10Exhibit

                                                                                                                                  Exhibit 10.1    

FARMER BROS. CO. 
2017 LONG-TERM INCENTIVE PLAN 
RESTRICTED STOCK UNIT AWARD AGREEMENT
Farmer Bros. Co. (the “Company”) has granted to the participant listed below (“Participant”) the restricted stock units (the “RSUs”) described in this Restricted Stock Unit Award Agreement (this “Agreement”), subject to the terms and conditions of this Agreement and the Farmer Bros. Co. 2017 Long-Term Incentive Plan (as amended from time to time, the “Plan”), which is incorporated into this Agreement by reference.  For purposes of this Agreement, references to the “Company” shall include any Subsidiary employer, as applicable.  To the extent not defined herein, terms used in this Agreement which are defined in the Plan shall have the same meanings as set forth in the Plan.
	
		
	Participant:
	 

	Grant Date:
	 

	Number of RSUs Granted:
	 

	Vesting Schedule:
	Subject to and conditioned upon Participant’s continued employment with the Company through the applicable Vesting Date, and further subject to the terms and conditions of this Agreement and the Plan, the RSUs shall vest and become exercisable as follows:
Notwithstanding the foregoing, the RSUs shall be subject to accelerated vesting in certain circumstances as provided in this Agreement.
In no event shall the RSUs vest and become exercisable for any additional Shares following Participant’s Termination of Service.

	
	
	

ELECTRONIC ACCEPTANCE OF AWARD: 

By clicking on the “ACCEPT” box on the “Accept Grant” page, you agree to be bound by the terms and conditions of this Agreement and the Plan.  You acknowledge that you have reviewed and fully understand all of the provisions of this Agreement and the Plan, and have had the opportunity to obtain advice of counsel prior to accepting the grant of the RSUs pursuant to this Agreement.  You hereby agree to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan or relating to the RSUs.

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Article I. 
AWARD; VESTING; FORFEITURE AND SETTLEMENT
1.1    RSUs and Dividend Equivalents.  
(a)    Each RSU represents the right to receive one Share on the terms, and subject to the conditions, set forth in this Agreement.  Participant will have no right to the distribution of any Shares until such time (if ever) as the RSUs have vested hereunder.
(b)    The Company hereby grants to Participant, with respect to each RSU, a Dividend Equivalent right that shall, to the extent that any dividend becomes payable on Common Stock while such Dividend Equivalent right remains outstanding, and subject to the terms set forth below, entitle Participant to a cash payment in the amount of any such dividend paid by the Company in respect of a share of Common Stock.  The Dividend Equivalent right shall remain outstanding from the Grant Date through the earlier to occur of (i) the termination or forfeiture for any reason of the RSU to which such Dividend Equivalent right corresponds, or (ii) the delivery to the Participant of the share of Common Stock in respect of the RSU to which such Dividend Equivalent right corresponds (in any case, the “RSU Termination Date”).  For clarity, each Dividend Equivalent right will entitle Participant to a cash payment in the amount of any dividend(s) paid by the Company in respect of a share of Common Stock to the extent that such dividend(s) are declared and have ex dividend date(s), in each case, that occur on or after the applicable Grant Date and on or prior to the applicable RSU Termination Date, payable upon the settlement date in respect of the RSU to which such Dividend Equivalent right corresponds as provided in Section 1.3 of this Agreement; provided, that with respect to any dividends meeting such criteria that are paid after the RSU Termination Date, the applicable Dividend Equivalent payment will be paid if and when the Company pays the underlying dividend (but in no event later than March 15th of the year following the year in which the applicable ex dividend date occurs). For the avoidance of doubt, (x) if an RSU does not ultimately vest hereunder, no Dividend Equivalent payments shall be made with respect to such unvested RSU, and (y) in no event shall a Dividend Equivalent payment be made that would result in Participant receiving both the Dividend Equivalent payment (in respect of a dividend) and the actual dividend with respect to the same RSU and corresponding share of Common Stock.  Dividend Equivalent rights and any amounts that may become distributable in respect thereof shall be treated separately from the RSUs and the rights arising in connection therewith for purposes of the designation of time and form of payments required by Section 409A.
1.2    Forfeiture.  Unless the Administrator otherwise determines or as otherwise provided for in the Plan or this Agreement with respect to Participant’s Termination of Service, the RSUs will immediately and automatically be cancelled and forfeited as to any portion that is not vested as of Participant’s Termination of Service.  Dividend Equivalents (including any Dividend Equivalent Account balance) will vest or be forfeited, as applicable, upon the vesting or forfeiture of the RSU with respect to which the Dividend Equivalent (including the Dividend Equivalent Account) relates.
1.3    Settlement. All of Participant’s RSUs which are then vested pursuant to the Vesting Schedule set forth above will be paid in Shares, and any related Dividend Equivalents (including any Dividend Equivalent Account balance) will be paid in cash, in each case, during the thirty (30)-day period following the date on which RSUs first become vested.  Notwithstanding anything to the contrary in this Agreement 

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or the Plan, no RSUs or Dividend Equivalents shall be distributed to Participant pursuant to this Section 1.3 during the six-month period following Participant’s Separation from Service if the Company determines that distributing such RSUs and Dividend Equivalents at the time or times indicated in this Agreement would be a prohibited distribution under Section 409A(a)(2)(B)(i) of the Code.  If the distribution of any of Participant’s RSUs and Dividend Equivalents is delayed as a result of the previous sentence, then such RSUs and Dividend Equivalents (including any Dividend Equivalent Account balance) shall be paid to Participant during the thirty (30)-day period beginning on the first business day following the end of such six-month period (or such earlier date upon which such RSUs and Dividend Equivalents can be distributed under Section 409A without resulting in a prohibited distribution, including as a result of Participant’s death).
Article II.     
TAXATION AND TAX WITHHOLDING 
2.1    Responsibility for Taxes.  
(a)    Participant acknowledges that, regardless of any action taken by the Company, the ultimate liability for all income tax, social insurance, payroll tax, employment tax, fringe benefit tax, payment on account or other tax-related items related to Participant's participation in the Plan and legally applicable to Participant or deemed by the Company in its discretion to be an appropriate charge to Participant even if legally applicable to the Company (“Tax-Related Items”) is and remains Participant’s responsibility and may exceed the amount actually withheld by the Company.  Participant further acknowledges that the Company (i) makes no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the RSUs, including, but not limited to, the grant or vesting of the RSUs or any related Dividend Equivalents, the subsequent sale of Shares acquired upon vesting, and the receipt of any dividends; and (ii) does not commit to and is under no obligation to structure the terms of the grant or any aspect of the RSUs to reduce or eliminate Participant’s liability for Tax-Related Items or achieve any particular tax result.  Further, if Participant is subject to Tax-Related Items in more than one jurisdiction, Participant acknowledges that the Company may be required to withhold or account for Tax-Related Items in more than one jurisdiction.
(b)    Prior to the relevant taxable or tax withholding event, as applicable, Participant agrees to cooperate with the Company in satisfying any applicable withholding obligations for Tax-Related Items.  In this regard, the Company or its agents, at their discretion, may satisfy, or allow Participant to satisfy, the withholding obligation with regard to all Tax-Related Items by any of the following, or a combination thereof:
(i)    By delivery of cash, check or wire transfer of immediately available funds by Participant to the Company; provided that the Administrator may limit the use of one of the foregoing methods if one or more of the methods below is permitted;
(ii)    Unless the Administrator otherwise determines, (A) delivery (including telephonically to the extent permitted by the Administrator) of a notice to the Company that the Participant has placed a market sell order with a broker acceptable to the Administrator with respect 

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to Shares then issuable and that the broker has been directed to deliver promptly to the Company funds sufficient to satisfy the tax obligations, or (B) the Participant’s delivery to the Company of a copy of irrevocable and unconditional instructions to a broker acceptable to the Administrator to deliver promptly to the Company an amount sufficient to satisfy the tax withholding by cash, check or wire transfer of immediately available funds; provided, that such amount is paid to the Company at such time as may be required by the Administrator; or 
(iii)    To the extent permitted by the Administrator, delivery to the Company of Shares, including Shares delivered by attestation and Shares then issuable in settlement of the RSUs, valued at their Fair Market Value on the date of delivery (or such other date determined by the Administrator). 
(c)    The Company has the right and option, but not the obligation, to treat Participant’s failure to provide timely payment of any tax withholding with regard to all Tax-Related Items as Participant's election to satisfy all or a portion of the tax withholding pursuant to Section 2.1(b)(iii) above.  
(d)    Depending on the withholding method, the Company may withhold or account for Tax-Related Items by considering applicable statutory withholding amounts or other applicable withholding rates, including maximum applicable rates, in which case Participant may receive a refund of any over-withheld amount in cash through the Company’s normal payroll processes and will have no entitlement to the Common Stock equivalent.  
(e)    Finally, Participant agrees to pay to the Company any amount of Tax-Related Items that the Company may be required to withhold or account for as a result of Participant's participation in the Plan that cannot be satisfied by the means previously described.  The Company may refuse to honor the vesting of the RSUs and/or refuse to issue or deliver the Shares or the proceeds from the sale of the Shares if Participant fails to comply with Participant's obligations in connection with the Tax-Related Items.
Article III.     
OTHER PROVISIONS
3.1    Nature of Grant.  In accepting the RSUs, Participant understands, acknowledges, and agrees that:
(a)    the Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time in accordance with its terms;
(b)    the grant of the RSUs is exceptional, voluntary and occasional and does not create any contractual or other right to receive future grants of RSUs, or benefits in lieu of RSUs, even if RSUs have been granted in the past; 
(c)    all decisions with respect to future RSU or other grants, if any, will be at the sole discretion of the Administrator; 

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(d)    the RSU grant and participation in the Plan shall not create a right to employment or service or be interpreted as forming or amending an employment or service contract with the Company or any other Subsidiary and shall not interfere with the ability of the Company or any other Subsidiary, as applicable, to terminate Participant's employment or service relationship (if any) at any time with or without cause; 
(e)    Participant is voluntarily participating in the Plan; 
(f)    the RSUs and any Shares acquired under the Plan, and the income and value of same, are not intended to replace any pension rights or compensation (if any);
(g)    the RSUs and any Shares acquired under the Plan, and the income and value of same, are not part of normal or expected compensation for purposes of calculating any severance, resignation, termination, redundancy, dismissal, end of service payments, bonuses, long-service awards, pension or retirement benefits, welfare benefits or other similar payments (if any);
(h)    the future value of the Shares underlying the RSUs is unknown, indeterminable and cannot be predicted with certainty;
(i)    no claim or entitlement to compensation or damages shall arise from forfeiture of the RSUs resulting from Participant's Termination of Service (for any reason whatsoever, whether or not later found to be invalid or in breach of Applicable Laws or the terms of Participant's employment or service agreement, if any);
(j)    unless otherwise agreed with the Company, the RSUs and the Shares underlying the RSUs, and the income and value of same, are not granted as consideration for, or in connection with, any services Participant may provide as a director of a Subsidiary; and
(k)    unless otherwise provided in the Plan or by the Administrator, the RSUs and the benefits evidenced by this Agreement do not create any entitlement to have the RSUs or any such benefits transferred to, or assumed by, another company, nor to be exchanged, cashed out or substituted for, in connection with any corporate transaction affecting the Common Stock.
3.2    No Advice Regarding Grant.  Neither the Company nor any Subsidiary is providing any tax, legal or financial advice, nor is any such party making recommendations regarding participation in the Plan, or Participant's acquisition or sale of the underlying Shares.  Participant understands and agrees that Participant should consult with Participant's own personal tax, legal and financial advisors regarding participation in the Plan before taking any action related to his or her Awards under the Plan.
3.3    Transferability. The RSUs are not transferable, except by will or the laws of descent and distribution or as permitted by the Administrator in accordance with the terms of the Plan.  Any permitted transfer of an Award hereunder shall be without consideration, except as required by Applicable Law.

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3.4    Adjustments.  Participant acknowledges that the RSUs, the Shares subject to the RSUs and the Dividend Equivalents are subject to adjustment, modification and termination in certain events as provided in this Agreement and the Plan.
3.5    Defined Terms; Titles.  Capitalized terms not defined in this Agreement have the meanings given to them in the Plan. Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of this Agreement.
3.6    Conformity to Applicable Laws.  Participant acknowledges that the Plan and this Agreement are intended to conform to the extent necessary with all Applicable Laws and, to the extent Applicable Laws permit, will be deemed amended as necessary to conform to Applicable Laws.
3.7    Successors and Assigns; Third-Party Beneficiaries.  The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement will inure to the benefit of the successors and assigns of the Company.  Subject to the transfer provisions set forth in the Plan, this Agreement will be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors and assigns of the parties hereto.  Each Subsidiary is an intended third-party beneficiary of any rights or entitlements conferred on any such party hereunder, and shall be entitled to enforce such rights and entitlements hereunder as if such entity was a signatory to this Agreement.
3.8    Entire Agreement and Imposition of Other Terms.  The Plan and this Agreement (including all exhibits and appendices hereto) constitute the entire agreement of the parties and supersede in their entirety all prior undertakings and agreements of the Company (or between any other Subsidiary) and Participant with respect to the subject matter hereof.  Nonetheless, the Company reserves the right to impose other requirements on Participant’s participation in the Plan, on the RSUs and on any Shares acquired under the Plan, to the extent the Administrator determines it is necessary or advisable for legal or administrative reasons, and to require Participant to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.  In the event of any inconsistency between the Plan and this Agreement, the terms of the Plan will control.
3.9    Severability.  In the event that any provision of this Agreement is held illegal or invalid, the provision will be severable from, and the illegality or invalidity of the provision will not be construed to have any effect on, the remaining provisions of this Agreement.
3.10    Waiver.  Participant acknowledges that a waiver by the Company of breach of any provision of this Agreement shall not operate or be construed as a waiver of any other provision of this Agreement, or of any subsequent breach by Participant or any other person.
3.11    Limitation on Participant’s Rights.  Participation in the Plan confers no rights or interests other than as herein provided.  This Agreement creates a contractual arrangement between the Company and Participant only (except as expressly provided above with respect to third-party rights of Subsidiaries) and shall not be construed as creating a trust for the benefit of Participant.  Neither the Plan nor any underlying program, in and of itself, has any assets.  Participant will have only the rights of a general unsecured creditor of the Company with respect to amounts credited and benefits payable, if any, with respect to the RSUs and Dividend Equivalents, and rights no greater than the right to receive the Shares or cash as a general 

7

unsecured creditor with respect to the RSUs and Dividend Equivalents, as and when settled pursuant to the terms hereof.
3.12    Electronic Delivery and Acceptance.  The Company may, in its sole discretion, decide to deliver any documents related to current or future participation in the Plan by electronic means.  Participant hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.
3.13    Notices.  Any notice to be given under the terms of this Agreement to the Company must be in writing and addressed to the Company in care of the Company’s Secretary at the Company’s principal office or the Secretary’s then-current email address or facsimile number.  Any notice to be given under the terms of this Agreement to Participant must be in writing and addressed to Participant at Participant’s last known mailing address, email address or facsimile number in the Company’s personnel files.  By a notice given pursuant to this Section, either party may designate a different address for notices to be given to that party.  Any notice will be deemed duly given when actually received, when sent by email, when sent by certified mail (return receipt requested) and deposited with postage prepaid in a post office or branch post office regularly maintained by the United States Postal Service, when delivered by a nationally recognized express shipping company or upon receipt of a facsimile transmission confirmation.
3.14    Limitations Applicable to Section 16 Persons.  Notwithstanding any other provision of the Plan or this Agreement, if Participant is subject to Section 16 of the Exchange Act, the Plan, this Agreement and the RSUs will be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3) that are requirements for the application of such exemptive rule.  To the extent Applicable Laws permit, this Agreement will be deemed amended as necessary to conform to such applicable exemptive rule.  
3.15    Insider Trading Restrictions/Market Abuse Laws.  Participant acknowledges that Participant may be subject to insider trading restrictions and/or market abuse laws, which may affect Participant’s ability to acquire or sell Shares or rights to Shares under the Plan during such times when Participant is considered to have “inside information” regarding the Company (as defined by Applicable Laws).  Any restrictions under these laws or regulations are separate from and in addition to any restrictions that may be imposed under any applicable insider trading policy of the Company.  Participant acknowledges that Participant is responsible for ensuring compliance with any applicable restrictions and should consult Participant’s personal legal advisor on these matters.
3.16    Section 409A. The intent of the parties is that the payments and benefits under this Agreement comply with or be exempt from Section 409A and the regulations and guidance promulgated thereunder and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith.  For purposes of Section 409A, each payment that Participant may be eligible to receive under this Agreement shall be treated as a separate and distinct payment.
 3.17     Clawback Provisions.  In consideration of the grant of this Award, Participant agrees that this Award (including the gross amount of any proceeds, gains or other economic benefit Participant actually 

8

or constructively receives upon receipt of this Award or the receipt or resale of any Shares underlying this Award) will be subject to recoupment by the Company to the extent required to comply with Applicable Laws or any policy of the Company providing for the reimbursement of incentive compensation (including any policy adopted after the Grant Date).
3.17    Governing Law.  This Agreement and the RSUs and the Dividend Equivalents will be governed by and interpreted in accordance with the laws of the State of Delaware, disregarding the choice-of-law principles of the State of Delaware and any other state requiring the application of a jurisdiction’s laws other than the State of Delaware.
*****

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