Document:

EXHIBIT 10.3

 

 

EXECUTIVE EMPLOYMENT AGREEMENT

This Executive Employment Agreement (the "Agreement") is made as of June 29, 2018, by and between Mission Media USA, Inc. (the "Company"), Troika Media Group, Inc. (the "Parent"), and Nicola Stephenson, an individual having an address at 200 Water Street, Apt. 3A, Brooklyn, NY 11201 ("Executive"). Executive, Company and Parent shall be individually referred to as a "Party" and collectively as the "Parties."

1. Duties and Scope of Employment.

(a)     Positions; Duties.  During the Employment Term (as defined in Section 2), the Company shall employ Executive as: (i) the President of each of the Company, MissionCulture LLC, and Mission-Media Holdings Limited (collectively, "Mission Media"), and (ii) at such time as Parent has successfully obtained its E-2 Treaty Investor Company Registration on behalf of itself and its subsidiaries (the "E-2 Registration") and Executive has obtained her E-2 visa status under the E-2 Registration, the Executive shall be appointed President of the Parent. Executive shall have duties, authority, and responsibilities that are reasonable, consistent, and customary with such position.  Executive shall report to the Chief Executive Officer and the Board of Directors of Parent (the "Board") at its New York office.

(b)     Obligations.  During the Employment Term, Executive shall devote substantially all of Executive's business efforts and time to the Company and Mission Media, and to Parent to the extent the conditions set forth in Section 1(a)(ii) above are fulfilled.  Executive agrees, during the Employment Term, not to actively engage in any other employment, occupation or consulting activity for any direct or indirect remuneration or benefit whatsoever or howsoever without the prior approval of the Board of Directors of the Parent (the "Board") or the Chief Executive Officer; provided, however, that Executive may (i) serve in any capacity with any professional, community, industry, civic, educational or charitable organization, (ii) serve as a member of corporate boards of directors or as an advisor to companies that the Executive currently serves  and, with the consent of the Board (which consent shall not be unreasonably withheld or delayed), other corporate boards of directors, and (iii) manage Executive's and Executive's family's personal investments and legal affairs; provided, however, that in each instance, such activities do not materially interfere with the discharge of Executive's duties.  It is expressly understood and agreed that, notwithstanding any provision of this Agreement to the contrary, that it is a material condition of this Agreement that the Executive travel to and spend periods of time at certain Company satellite locations (e.g. London), as mutually agreed by the Parties.

2. Employment Term.  The Company hereby agrees to employ Executive and Executive hereby accepts such employment, in accordance with the terms and conditions set forth herein, commencing on the date hereof (the "Employment Commencement Date") and continuing until the fifth (5th) anniversary of the Employment Commencement Date (the "Initial Term"), unless terminated earlier pursuant to this Agreement; provided that on the fifth (5th) anniversary of the Employment Commencement Date and each second anniversary of the Employment Commencement Date thereafter (such date and each second anniversary thereof, a "Renewal Date"), this Agreement shall be deemed to be automatically extended, upon the same terms and conditions, for successive periods of two years, or for such other period as Executive and the Company may mutually agree in writing (each a "Renewal Term"), unless either Executive or Company has given written notice to the other that such automatic extension will not occur (a "Non-Renewal Notice"), which notice must be given not less than ninety (90) days prior to the applicable Renewal Date. The period during which the Executive is employed by the Company hereunder is hereinafter referred to as the "Employment Term."

 

 

 

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3. Compensation/Benefits.  During the Employment Term, the Company shall pay and provide to Executive the following:

(a)     Cash Compensation.  As compensation for Executive's services to the Company, Executive shall receive a base salary and shall be eligible to receive additional variable compensation.  During the Employment Term, the Board or its Compensation Committee (the "Compensation Committee") shall review Executive's Base Salary (as defined below) and Bonus (as defined below) then in effect at least annually and may increase (but not decrease) such Base Salary and/or Bonus as the Compensation Committee may approve.  The Base Salary shall be payable in accordance with the Company's normal payroll practices in effect from time to time, but in no event less frequently than bi-monthly, and, in the case of the Bonus, as soon as practical during the calendar year following the calendar year with respect to which such Bonus is payable, but in no event later than March 15th of such following calendar year.  No increase in Base Salary shall be used to offset or otherwise reduce any obligations of the Company to Executive hereunder or otherwise.

(i)     Annual Base Salary.  Executive's annual Base Salary under this Agreement shall be FIVE HUNDRED THOUSAND USD ($500,000.00) ("Base Salary").

(ii)     Annual Discretionary Bonus.  In addition to the Annual Base Salary, Executive shall also be eligible to earn annual variable compensation, the amount of which will be set by the Compensation Committee (the "Bonus"). The Bonus for any calendar year shall be awarded at the sole and absolute discretion of the Compensation Committee based upon the Company's achievement of stated financial and strategic goals, as established by the Compensation Committee.  Any such Bonus may be made to Executive by means of cash or stock options.

(iii)     Other Compensation.  Executive shall also be eligible to participate in all other bonus and incentive compensation plans and programs, if any, provided by the Company or Parent to its senior executives in accordance with the terms thereof as in effect from time to time ("Other Compensation").

(iv)     Currency.  All payments and amounts hereunder shall be in United States Dollars.

(b)     Equity Compensation.

(i)     Stock Ownership.  The Company shall cause Parent to authorize and reserve a pool of Seven Million Five Hundred Thousand (7,500,000) shares of common stock of Parent (the "Pool") to be granted as incentives to employees of Mission Media (the "Options" and, once vested, the "Vested Shares"), on terms mutually agreed to by the Parties in writing within ninety (90) days after the Employment Commencement Date and in accordance with the Employee Stock Option Plan.  Executive and James Stephenson will both be granted Options under the Pool and Executive shall recommend the recipients and the amount of the grants of Options, subject to the approval of the Board.  If Executive's employment hereunder is terminated by Company without Cause, is terminated by Executive for Good Reason or as a result of Executive's death or Disability Termination (as defined herein), then, in addition to any other benefits to which Executive is entitled pursuant to this Agreement, the Options held by Executive shall accelerate and be fully vested and immediately exercisable.

(ii)     Ongoing Awards.  Executive shall be eligible to participate fully in annual stock option grants, and any other long-term equity incentive programs at levels commensurate with Executive's position and as determined by the Compensation Committee.

 

 

 

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(c)     Employee Benefits.  Executive shall, to the extent eligible, be entitled to participate, at a level commensurate with Executive's position, in all employee benefits, welfare and retirement plans and programs, as well as equity plans, provided by the Company or the Parent to its senior executives in accordance with the terms thereof as in effect from time to time.  Notwithstanding the foregoing, at all times, the Company and Parent (as applicable) reserves the right to amend, modify, or terminate any such plan or program.

(d)     Perquisites.  The Company shall provide to Executive, at the Company's cost, all benefits and perquisites, including (without limitation) health insurance, dental insurance for the Executive and her family and life insurance, on terms no less favorable than enjoyed by the Executive as of the date of this Agreement and approved by Executive; provided, that the Company shall pay all premiums of the Executive and her family's participation in the Company-sponsored group health plan – the 'Oxford Freedom Platinum' plan (the "Health Plan") at such level of coverage as determined by Executive. The Company will not amend, modify or terminate the Executive's and her family's right to participate in the Health Plan, or otherwise interfere with their ability to remain covered by the Health Plan. Notwithstanding the foregoing, the Company may amend, modify or terminate the Health Plan, so long as the Company procures replacement group health coverage for Executive and her family, with no gap in coverage, and such replacement coverage provides substantially the same value and benefits at substantially the same cost, and provided such replacement plan is in accordance with applicable law.

(e)     Business and Entertainment Expenses.  Upon submission of appropriate documentation by Executive in accordance with the Company's policies in effect from time to time, the Company shall pay or reimburse Executive for all business expenses that Executive incurs in performing Executive's duties under this Agreement, including, but not limited to, business class travel (excluding gas mileage), entertainment, and professional dues and subscriptions, in accordance with the Company's and Parent's policies in effect from time to time.

(f)     Vacation, Holidays and Sick Leave.  Executive shall be entitled to vacations of no less than twenty-five (25) days per calendar year excluding public holidays.  Executive shall be eligible for such other paid holidays, sick leave, paid family leave, and other leaves and benefits provided to other senior executives of the Company or the Parent, in accordance with the Company's or Parent's employment manual or effective policies and procedures or as required by law.

(g)     Expenses. Subject to and in accordance with the Company's or Parent's policies and procedures and in accordance with the Company's or Parent's expense policy, as it may be amended from time to time, the Company shall reimburse Executive for the cost associated with cellular telephone, internet access and other reasonable expenses associated with business uses upon appropriate submission and documentation of such expenses.

4. Termination of Employment.

(a)     Death or Disability.  The Company may terminate Executive's employment for disability in the event Executive has been unable to perform Executive's material duties hereunder for six (6) consecutive months because of physical or mental incapacity by giving Executive notice of such termination while such continuing incapacity continues (a "Disability Termination").  Executive's employment shall automatically terminate on Executive's death.  In the event Executive's employment with the Company terminates during the Employment Term by reason of Executive's death or a Disability Termination, then upon the date of such termination:

(i)     any Options or other shares shall accelerate and be fully vested and immediately exercisable;

(ii)     the Company shall, within fourteen (14) days of the date Executive's employment is terminated, pay and provide Executive (or in the event of Executive's death, Executive's estate) (A) any unpaid Base Salary through the date of termination and any accrued vacation, (B) reimbursement for any unreimbursed expenses incurred through the date of termination, and (C) all other payments, benefits or fringe benefits to which Executive may be entitled subject to and in accordance with the terms of any applicable compensation arrangement or benefit, equity or fringe benefit plan or program or as required under applicable law, or grant any amounts that may become due under Sections 3 or 4 hereof (the items under this clause (ii) are collectively referred to as "Accrued Benefits"); and

 

 

 

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(iii)     the Company shall pay to Executive at the time other senior executives are paid under any cash bonus or long-term incentive plan, but in no event later than March 15th of the calendar year following the calendar year in which Executive's employment is terminated, a pro-rata bonus equal to the amount Executive would have received if Executive's employment had continued (without any discretionary cutback) multiplied by a fraction where the numerator is the number of days in each respective bonus period prior to Executive's termination and the denominator is the number of days in the bonus period (the "Prorated Bonus"); provided, however, that at the time of death or Disability Termination, Executive is on pace to achieve the performance milestones necessary to be eligible for such bonus.

(iv)     the Executive will continue to participate in any Bonus or Other Compensation plan, in accordance with the terms of such plan until such plan has expired.

(b)     Termination for Cause.  The Company may terminate Executive's employment for Cause (as defined below).  In the event that Executive's employment with the Company is terminated during the Employment Term by the Company for Cause, Executive shall not be entitled to any additional payments or benefits hereunder, other than Accrued Benefits (including, but not limited to, any Vested Shares and other equity awards), to be paid or provided within thirty (30) days of the date Executive's employment is terminated.

(i)     For the purposes of this Agreement, "Cause" shall mean:

(A)     material breach of any provision of this Agreement by Executive, which has not been remedied within 30 days from written notice of such breach from the Board that specifically identifies such material breach.

(B)     the willful failure by Executive to perform Executive's duties with the Company (other than any such failure resulting from Executive's incapacity due to physical or mental impairment), unless any such failure is corrected within thirty (30) days following written notice by the Board that specifically identifies the manner in which the Board believes Executive has not materially performed Executive's duties; provided, however, that no act, or failure to act, by Executive shall be "willful" unless committed without good faith and without a reasonable belief by the Executive that the act or omission was in the best interest of the Company; or

(C)     an act of gross misconduct by Executive with regard to the Company that is materially injurious to the Company and is committed without good faith and without a reasonable belief by the Executive that the act or omission was in the best interest of the Company.

(c)     Termination by the Company Other Than for Cause or by the Executive for Good Reason.  Any payments to be made or benefits to be provided under this Section 4(c) are conditioned on (x) Executive's execution of a customary general release and/or termination agreement ("General Release") reasonably satisfactory to the Company, provided that such General Release shall not contain restrictive covenants already contained in this Agreement or other agreements between or among the Parties, and (y) such General Release becoming effective; provided, however, that such conditions shall be deemed waived by the Company if the General Release is not presented to Executive within fourteen (14) days of such termination.

(i)     For the purposes of this Agreement, "Good Reason" shall mean any one or more of the following, except as Executive shall otherwise consent in writing: (A) a material reduction of Executive's salary, title, authority, duties, responsibilities or reporting relationships; (B) the assignment to Executive of any duties inconsistent with Executive's position or that are no consistent with those of other senior executives; (C) a relocation of Executive's workplace to a location more than 10 miles from her present workplace; or (D) the Parent breaches Section 6.06 of that certain Goodwill Purchase Agreement dated on or about the date hereof among the Parent, Executive and a subsidiary of Parent (the "Goodwill Purchase Agreement") or Section 9.06 of that certain Equity Purchase Agreement dated on or about the date hereof among Parent, Executive, James Stephenson and a subsidiary of the Parent (the "Equity Purchase Agreement").

 

 

 

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(ii)     If Executive's employment with the Company is involuntarily terminated by the Company other than for Cause or the Executive terminates her employment for Good Reason (as defined below), then the Company shall pay or provide Executive with the following as of the date of termination:

(A)     any Accrued Benefits, to be paid or provided on the date Executive's employment is terminated;

(B)     the Prorated Bonus for each year remaining in the Initial Term or the Renewal Term, as applicable; provided, however, that at the time of the termination of Executive's employment, Executive is on pace to achieve the performance milestones necessary to be eligible for such bonus, and provided further that such Prorated Bonus is paid no later than March 15 of the calendar year following the calendar year in which Executive's employment is terminated;

(C)     a severance amount equal to one (1) year of the Executive's then-current annual Base Salary, payable in a lump-sum or semi-annual payments, commencing on the date Executive's employment is terminated;

(D)     the right to participate in the Bonus plan, and Other Compensation plans in effect from time to time, until such plans expire;

(E)     all shares of unvested stock Options shall immediately become vested;

(F)     [RESERVED.]

(G)     the right to continue Executive's and her family's participation in the Health Plan, either directly or through COBRA continuation, at substantially the same value and benefits at no additional cost to Executive other than she would have incurred as an employee, for the amount of time remaining on the Initial Term or the Renewal Term, as applicable, or the length of time Executive is entitled to continue health insurance under applicable law when combining COBRA and New York State continuation benefits), whichever is less, beginning with the first calendar month after such date of termination.  In the event Executive obtains other employment during such period, pursuant to which she becomes covered for substantially similar or improved benefits at substantially the same cost, Executive's right to continue to participate in the Health Plan, at the Company's expense, offered or provided by the Company shall immediately cease; and

(H)     reasonable outplacement services at a level commensurate with Executive's position, including use of an executive office, for a period of ninety (90) days commencing on Executive's date of termination but in no event extending beyond the date on which Executive commences other full time employment.

(d)     Termination by Executive Other Than for Good Reason.  Executive may terminate Executive's employment at any time by written notice to the Company.  In the event that Executive terminates Executive's employment with the Company during the Employment Term without Good Reason, Executive shall not be entitled to any additional payments or benefits hereunder, other than Accrued Benefits (including, but not limited to, any Vested Shares and other equity awards), which shall be paid or provided to Executive within thirty (30) days of the date Executive's employment is terminated.

(e)     Termination Due to Non-Renewal by the Company or Executive. In the event Executive's employment with the Company is terminated due to the Company or Executive sending a Non-Renewal Notice in accordance with Section 2 of this Agreement, Executive shall be entitled to the Accrued Benefits (including, but not limited to, any Vested Shares and other equity awards) and payment of the Bonus to which Executive is entitled for the calendar year in which the Non-Renewal Notice was sent, which shall be paid or provided to Executive within thirty (30) days of the date Executive's employment is so terminated.

(f) No Mitigation/No Offset.  Executive shall not be required to seek other employment or otherwise mitigate the value of any severance benefits contemplated by this Agreement, nor shall any such benefits be reduced by any earnings or benefits that Executive may receive from any other source, except as provided in Section 4(c)(ii)(G).  The amounts payable hereunder shall not be subject to setoff, counterclaim, recoupment, defense or other right that the Company may have against Executive or others.

 

 

 

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5. Change of Control Vesting Acceleration.

(a)     In the event of a Change of Control (as defined below), one hundred percent (100%) of Executive's then-unvested Options or other shares shall immediately vest, and all vested Bonuses (both current and future) are immediately due and payable, regardless of whether the milestone has been achieved.

(b)     After a Change of Control (as defined below), in the event that (i) Executive's aggregate compensation is substantially diminished (regardless of Executive's title, duties, or responsibilities), or (ii) Executive is required to work more than ten (10) miles from Executive's then-current place of work in order to continue to perform Executive's duties under this Agreement, and if, after a Change of Control, Executive terminates Executive's employment with the Company, she shall be entitled to receive all severance benefits set forth in Section 4(c).

(c)     For the purposes of this Agreement, "Change of Control" is defined as the occurrence of any of the following after the Employment Commencement Date:

(i)     any "person" (as defined in Section 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act")), excluding for this purpose (x) the Parent or any subsidiary of the Parent, or (y) any employee benefit plan of the Parent or any subsidiary of the Parent, or any person or entity organized, appointed or established by the Parent for or pursuant to the terms of any plan which acquires beneficial ownership of voting securities of the Parent, is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly of securities of the Parent representing more than fifty percent (50%) of the combined voting power of the Parent's then outstanding securities; provided, however, that no Change of Control will be deemed to have occurred as a result of a change in ownership percentage resulting solely from an acquisition of securities by the Parent, the grant or exercise of any stock option, stock award, stock purchase right or similar equity incentive, or the continued beneficial ownership by any party of voting securities of the Parent which such party beneficially owned as of the Employment Commencement Date; or

(ii)     persons, who, as of the Employment Commencement Date, constitute the Board (the "Incumbent Directors") cease for any reason, including without limitation, as a result of a tender offer, proxy contest, merger or similar transaction, to constitute at least a majority of the Board; provided, however, that any person becoming a director of the Parent subsequent to the Employment Commencement Date shall be considered an Incumbent Director if such person's election or nomination for election was approved by a vote of at least fifty percent (50%) of the Incumbent Directors; and provided further, that any such person whose initial assumption of office is in connection with an actual or threatened election contest relating to the members of the Board or other actual or threatened solicitation of proxies or consents by or on behalf of a "person" (as defined in Section 13(d) and 14(d) of the Exchange Act) other than the Board, including by reason of agreement intended to avoid or settle any such actual or threatened contest or solicitation, shall not be considered an Incumbent Director; or

(iii)     consummation of a reorganization, merger or consolidation or sale or other disposition of at least 80% of the assets (other than cash and cash equivalents) of the Parent (a "Business Combination"), in each case, unless, following such Business Combination, all or substantially all of the individuals and entities who were the beneficial owners of outstanding voting securities of the Parent immediately prior to such Business Combination beneficially own, directly or indirectly, more than fifty percent (50%) of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the Parent resulting from such Business Combination (including, without limitation, a company which, as a result of such transaction, owns the Parent or all or substantially all of the Parent's assets, either directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such Business Combination, of the outstanding voting securities of the Parent; or

(iv)     consummation of a reorganization, merger or consolidation or sale or other disposition of, directly or indirectly, a majority of the stock of, or at least 80% of the assets (other than cash and cash equivalents) of Mission Media; or

(v)     approval by the stockholders of the Parent or the Company of a complete liquidation or dissolution of the Parent or the Company.

 

 

 

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6. Golden Parachute Payments.

(a)     Executive shall bear all expense of, and be solely responsible for, all federal, state, local or foreign taxes due with respect to any benefit received pursuant to this Agreement, including, without limitation, any excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the "Code"); provided, however, that any benefit received or to be received by Executive in connection with a Change of Control ("Contract Benefits") or any other plan, arrangement or agreement with the Company or an affiliate (collectively with the Contract Benefits, the "Total Benefits") that would constitute a "parachute payment" within the meaning of Section 280G of the Code ("Covered Payments"), shall be reduced to the extent necessary so that no portion thereof shall be subject to the excise tax imposed by Section 4999 of the Code, but only if, by reason of such reduction, the net after-tax benefit received by Executive as a result of such reduction shall exceed the net after-tax benefit received by Executive if no such reduction was made.  For purposes of this Section 6, "net after-tax benefit" shall mean the Covered Payments that Executive receives or is then entitled to receive from the Company, less (i) the amount of all federal, state and local income and employment taxes payable by Executive with respect to such "Covered Payments," calculated at the highest marginal income tax rate for each year in which the foregoing shall be paid to Executive (based on the rates set forth in the Code as in effect at the time of the first receipt of the foregoing benefits), and (ii) the amount of excise taxes imposed with respect to such "Covered Payments" by Section 4999 of the Code.

(b)     The accounting firm engaged by the Company (or its successor) for general tax purposes shall perform any adjustment pursuant to subsection (a) of this Section 6.  The Company shall bear all expenses with respect to the determinations by such accounting firm required to be made hereunder.  The accounting firm engaged to make the determinations hereunder shall provide its calculations, together with detailed supporting documentation, to Executive and to the Company within fifteen (15) calendar days of being engaged to perform such determination and adjustment, or at such other time as requested by the Company.  Any good faith determinations of the accounting firm made hereunder shall be final, binding and conclusive upon you and the Company.

(c)     Any reduction of the Covered Payments in accordance with this Section 6 shall be made in accordance with Section 409A of the Code and the following: (i) the Covered Payments which do not constitute nonqualified deferred compensation subject to Section 409A of the Code shall be reduced first; and (ii) all other Covered Payments shall then be reduced as follows: (A) cash payments shall be reduced before non-cash payments; and (B) payments to be made on a later payment date shall be reduced before payments to be made on an earlier payment date.

7. Section 409A Compliance.

(a)     To the extent that any amount payable under this Agreement constitutes an amount payable under a "nonqualified deferred compensation plan" (as defined in Section 409A of the Code ("Section 409A")) following a "separation from service" (as defined in Section 409A), including any amount payable under Section 4, then, notwithstanding any other provision in this Agreement to the contrary, such payment will not be made to Executive earlier than the day after the date that is six (6) months following Executive's "separation from service."  This Section 7(a) will not be applicable after Executive's death. 

(b)     Executive and the Company acknowledge that the requirements of Section 409A are still being developed and interpreted by government agencies, that certain issues under Section 409A remain unclear at this time, and that the parties hereto have made a good faith effort to comply with current guidance under Section 409A.  Notwithstanding anything in this Agreement to the contrary, in the event that amendments to this Agreement are necessary in order to comply with future guidance or interpretations under Section 409A, including amendments necessary to ensure that compensation will not be subject to Section 409A, Executive agrees that the Company shall be permitted to make such amendments, on a prospective and/or retroactive basis, in its sole discretion.

 

 

 

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8. Restrictive Covenants.  The Parties expressly acknowledge that the following restrictions are further consideration for the sale by Executive of the business of Mission Media pursuant to the Goodwill Purchase Agreement and the Equity Purchase Agreement, that such restrictions are necessary to protect the goodwill of the Company and that such restrictions are fair and reasonable.  Executive holds specialized knowledge of the business of the Company (the "Business").  Executive and Company acknowledge and agree that (i) the Company would be irreparably harmed and impaired if Executive were to engage, directly or indirectly, in any activity competing with the Business, make any disclosure in violation of this Agreement or any unauthorized use of, any Confidential Information (as defined herein) concerning the Business, and (ii) the Company is entitled to protection from such use of the specialized knowledge of Executive.  Executive acknowledges that the Company's ability to keep its Confidential Information secret and away from its competitors is important to the Company's and its affiliates' viability and business.  Executive further acknowledges that over the course of Executive's employment with the Company Executive has and will (i) develop special and substantial relationships with the Company's and its affiliates' customers and suppliers, and/or (ii) be privy to Confidential Information.  Further, Executive has and will help develop the goodwill of the Company and its affiliates during the course of Executive's employment.  Finally, pursuant to Section 2.02(c) of the Equity Purchase Agreement and Section 3(b) herein, Executive will have a substantial ownership interest in the Company.  As such, Executive agrees to abide by the following covenants in order to allow the Company to protect those interests. For purposes of this Section 8, "Restricted Period" means the period beginning on the Employment Commencement Date and continuing until the one (1) year anniversary of Executive's employment termination date irrespective of the reason that Executive's employment is terminated with the Company.

(a)     Non-Competition.  During the Restricted Period, Executive will not either directly or indirectly, for Executive or any other person or entity, anywhere within the United States, carry on, own, be engaged in, assist, be employed by, consult for, serve as a director for, or have any financial interest in any business or enterprise that is materially engaged in  any of the services of the Company or manufactures or sells any of the products provided or offered by Company or any subsidiary or affiliate of Company, or if it performs any other services and/or engages in the production, manufacture, distribution or sale of any product similar to services or products, which services or products were performed, produced, manufactured, distributed, sold by Company or any subsidiary or affiliate of Company during the period while Executive performs services for Company, provided that an equity investment of not more than two percent (2%) in any company that is publicly traded and whose shares are listed on a national stock exchange will be permitted.

(b)     Non-Solicitation.  During the Restricted Period, Executive will not, except in the case of clause (i) below pursuant to a general solicitation which is not directed at such employee, either directly or indirectly, for Executive or any other person or entity, (i) hire, solicit for services, encourage the resignation of, or in any other manner seek to engage or employ any person who is an employee of the Company, Parent or Affiliate, or a consultant of the Company devoting more than seventy percent (70%) of such individual's time to the business of the Company or any of its affiliates during the one (1) year period immediately preceding Executive's termination date, or (ii) solicit or provide services to any customer of the Company, Parent or Affiliate  in connection with services and/or products that compete with the Company's services or products, provided that such customer is a customer of the Company during the one (1) year period preceding Executive's termination date.  For the purposes of this Section, "Affiliate" is defined as any company or entity at least 50% owned, directly or indirectly, by Parent.

(c)     Equitable Relief.  Executive acknowledges that the remedy at law for Executive's breach of Section 8, 9(a) and/or 10 will be inadequate, and that the damages flowing from such breach will not be readily susceptible to being measured in monetary terms.  Accordingly, upon a violation of any such Sections, the Company will be entitled to immediate injunctive relief (or other equitable relief) and may obtain a temporary order restraining any further violation.  No bond or other security will be required in obtaining such equitable relief, and Executive hereby consents to the issuance of such equitable relief.  Such equitable relief may be obtained from any court having appropriate jurisdiction over the matter.  Nothing in this Section 8(c) shall be deemed to limit the Company's remedies at law or in equity that may be pursued or availed of by the Company for any breach by Executive of any of the parts of Sections 8, 9(a) and/or 10.

(d)     Judicial Modification.  Executive acknowledges that it is the intent of the Parties hereto that the restrictions contained or referenced in Sections 8, 9 and 10 be enforced to the fullest extent permissible under the laws of each jurisdiction in which enforcement is sought.  If any of the restrictions contained or referenced in such Sections is for any reason held by a court or arbitrator to be excessively broad as to duration, activity, geographical scope, or subject, then, for purposes of that jurisdiction, such restriction shall be construed, judicially modified, or "blue penciled" so as to thereafter be limited or reduced to the extent required to be enforceable in accordance with applicable law.  Executive acknowledges and understands that, due to the nature and scope of the Company's existing and proposed business plans and projects, and the technological advancements in electronic communications, any narrower geographic restriction of Executive's obligations under Sections 8(a) and 8(b) would be inappropriate and counter to the protections sought by the Company thereunder.

 

 

 

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9. Confidential Information.

(a)     Non-Use and Non-Disclosure of Confidential Information.  Executive acknowledges that, during the course of Executive's employment with the Company, she has had and will have access to information about the Company and its affiliates, and their customers and suppliers, that is confidential and/or proprietary in nature, and that belongs to the Company and/or its affiliates.  As such, at all times, both during Executive's employment and thereafter, Executive will hold in the strictest confidence, not use or attempt to use, and not disclose to any other person or entity any Confidential Information (as defined below), except for the benefit of the Company and its affiliates or in connection with Executive's duties, responsibilities or authority as an employee of the Company or with the prior written authorization of the Board.  Notwithstanding anything contained in this Section 9, Executive will be permitted to disclose any Confidential Information to the extent required by law or validly-issued legal process or court order, provided that Executive notifies the Board immediately of any such legal process or court order in an effort to allow the Company to challenge such legal process or court order, if the Company so elects, prior to Executive's disclosure of any Confidential Information.

(b)     Definition of Confidential Information.  For purposes of this Agreement, "Confidential Information" means any confidential or proprietary information that belongs to the Company or its affiliates, or any of their customers or suppliers, including, without limitation, technical data, market data, trade secrets, trademarks, service marks, copyrights, other intellectual property, know-how, research, business plans, product and service information, projects, services, customer lists and information, customer preferences, customer transactions, supplier lists and information, supplier rates, software, hardware, technology, inventions, developments, processes, formulas, designs, drawings, marketing methods and strategies, pricing strategies, sales methods, financial information, project information, revenue figures, account information, credit information, financing arrangements, and other information disclosed to Executive by the Company or its affiliates in confidence, directly or indirectly, and whether in writing, orally, or by electronic records, drawings, pictures, or inspection of tangible property. Confidential Information shall not include information that is generally available to or known by the public at the time of disclosure to the Executive, or information which was already known by Executive prior to the Employment Commencement Date.

10. Return of Company Property.  Upon the termination of Executive's employment with the Company, or at any time during such employment upon request by the Company, Executive will promptly deliver to the Company and not keep in Executive's possession, recreate, or deliver to any other person or entity, any and all property that belongs to the Company or any of its affiliates, or that belongs to any other third party and is in Executive's possession as a result of Executive's employment with the Company, including, without limitation, records, data, customer lists and information, supplier lists and information, notes, reports, correspondence, financial information, account information, product and service information, project information, files, and other documents and information, including any and all copies of the foregoing.

11. Assignment.

(a)     This Agreement shall be binding upon and inure to the benefit of (i) the heirs, beneficiaries, executors and legal representatives of Executive upon Executive's death and (ii) any successor of the Company, provided, however, that any successor shall within ten (10) days of such assumption deliver to Executive a written assumption in a form reasonably acceptable to Executive.  Any such successor of the Company shall be deemed substituted for the Company under the terms of this Agreement for all purposes.  As used herein, "successor" shall mean any person, firm, corporation or other business entity that at any time, whether by purchase, merger or otherwise, directly or indirectly acquires all or substantially all of the assets or business of the Company.  Notwithstanding such assignment, the Company shall remain, with such successor, jointly and severally liable for all of its obligations hereunder.  This Agreement may not otherwise be assigned by the Company.

(b)     None of the rights of Executive to receive any form of compensation payable pursuant to this Agreement shall be assignable or transferable except through a testamentary disposition or by the laws of descent and distribution upon the death of Executive or as provided in Section 19 hereof.  Any attempted assignment, transfer, conveyance or other disposition (other than as provided in this Section 11) of any interest in the rights of Executive to receive any form of compensation hereunder shall be null and void; provided, however, that notwithstanding the foregoing, Executive shall be allowed to transfer Vested Shares or other stock options or equity awards consistent with the rules for transfers to "family members" as defined in U.S. Securities and Exchange Commission Form S‐8.

 

 

 

Page 9 of 12

 

 

12. Liability Insurance; Indemnification.

(a)     Parent and the Company shall cover Executive under directors' and officers' liability insurance both during and, while potential liability exists, after the Employment Term in the same amount and to the same extent as the Company covers its other officers and directors.

(b)     Parent and the Company shall, both during and after the Employment Term, indemnify, defend and hold harmless Executive to the fullest extent permitted by applicable law with regard to actions or inactions taken by Executive in the performance of Executive's duties as an officer, director and employee of the Company and its affiliates or as a fiduciary of any benefit plan of the Company and its affiliates. For the avoidance of all doubt, in the event of any litigation, investigation, or any other matter naming the Executive, the Company will, to the fullest extent permitted by law, advance 100% of the Executive's legal fees, including any retainers required, with an attorney or attorneys of the Executive's choice.

13. Notices.  All notices, requests, demands and other communications called for hereunder shall be in writing and shall be deemed given if (a) delivered personally or by facsimile, (b) one (1) day after being sent by Federal Express or a similar commercial overnight service, or (c) three (3) days after being mailed by registered or certified mail, return receipt requested, prepaid and addressed to the parties or their successors in interest at the following addresses, or at such other addresses as the parties may designate by written notice in the manner set forth in this Section 13:

If to the Company:

Michael Tenore, Esq.

101 S. La Brea Boulevard

Los Angeles, CA  90036

If to Executive:

Nicola Stephenson

200 Water St Apt 3A

Brooklyn, NY 11201

14. Severability.  In the event that any provision hereof becomes or is declared by a court of competent jurisdiction to be illegal, unenforceable or void, this Agreement shall continue in full force and effect without said provision.

15. Entire Agreement.  This Agreement represents the entire agreement and understanding between the Company and Executive with respect to the matters set forth herein, and supersedes and replaces any and all prior agreements and understandings concerning Executive's employment relationship with the Company entered into prior to the date hereof, but it does not supersede or replace any written agreements entered into simultaneous with this Agreement or thereafter.

 

 

 

Page 10 of 12

 

 

 

16. Arbitration.

(a)     Agreement.  The Parties agree that, except as otherwise provided in Section 8(c), any dispute or controversy arising out of, relating to, or in connection with the employment relationship between them, the inception of that relationship, the termination of that relationship, this Agreement, or the interpretation, validity, construction, performance, breach, or termination thereof, including, without limitation, claims of discrimination, harassment, and/or retaliation, and any violation of whistleblower laws, shall be settled by final and binding arbitration to be held in New York, NY or such other location agreed in writing by the parties hereto, under the auspices of and in accordance with the National Rules for the Resolution of Employment Disputes then in effect of the American Arbitration Association ("AAA").  The arbitrator may grant injunctions or other relief in such dispute or controversy.  The decision of the arbitrator shall be final, conclusive and binding on the parties to the arbitration.  Judgment may be entered on the arbitrator's decision in any court having jurisdiction.  The selection of the arbitrator will be conducted in accordance with the AAA's practices and procedures for disputes of the nature here contemplated.  The arbitrator will have authority and discretion to determine the arbitrability of any particular claim, should any disputes arise with respect to such issue.

(b)     Costs and Fees of Arbitration.  The moving party shall pay the costs of the initial arbitration filing (not to exceed two hundred fifty dollars ($250)), and the Company shall pay the remaining costs and expenses of such arbitration.  Unless otherwise required by law or pursuant to an award by the arbitrator, the Company and Executive shall each pay separately its attorney's fees and expenses.

17. No Oral Modification, Cancellation or Discharge.  This Agreement may only be amended, canceled or discharged in writing signed by Executive and an appropriate officer or director of the Company.

18. Survivorship.  The respective rights and obligations of Company and Executive hereunder shall survive any termination of Executive's employment by the Company to the extent necessary to carry out the intentions of Company and Executive under this Agreement.

19. Beneficiaries.  Executive shall be entitled, to the extent permitted under any applicable law, to select and change the beneficiary or beneficiaries to receive any compensation or benefit payable hereunder upon Executive's death by giving the Company written notice thereof.  If Executive dies, severance then due or other amounts due hereunder shall be paid to Executive's designated beneficiary or beneficiaries or, if none are designated or none survive Executive, to Executive's estate.

20. Parent Guarantee.  The Parent unconditionally guarantees all of the Company's obligations under this Agreement, including, but not limited to, Company's obligations to make any payments under this Agreement, Company's obligations to provide and pay for any benefits under this Agreement, and any other obligations of the Company under this Agreement, in the same manner and to the same extent as was required by the Company.

21. Withholding.  The Company shall be entitled to withhold, or cause to be withheld, any amount of federal, state, city or other withholding taxes required by law with respect to payments made to Executive in connection with Executive's employment hereunder.

22. Governing Law.  This Agreement shall be governed by New York law (without reference to rules of conflicts of law), which shall be applied to the merits of any dispute or claim submitted to arbitration pursuant to Section 16 of this Agreement.  Executive and the Company hereby expressly consent to the exclusive jurisdiction of the state and federal courts located in the County of New York for any action or proceeding relating to any arbitration pursuant to Section 16 of this Agreement in which the parties are participants, or any claim to which Section 8(c) applies.

23. Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which taken together shall constitute one and the same instrument.  A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

 

 

 [Remainder of page intentionally left blank – signatures on the following page]

 

 

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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date set forth above.

COMPANY:

Mission Media USA, Inc.

 

 

By: /s/      James Stephenson                                                             

Name:      James Stephenson

Title:        Chief Revenue Officer

EXECUTIVE:

 

 

/s/            Nicola Stephenson                                                               

Name:     Nicola Stephenson

PARENT:

Troika Media Group, Inc.

 

By:/s/      Christopher Broderick                                                      

Name:      Christopher Broderick

Title:        Chief Operating Officer

 

 

Page 12 of 12g-ex101_14.htm

Exhibit 10.1

Genpact LLC Executive Deferred Compensation Plan

ARTICLE 1

Establishment of Plan; Purpose

1.1Establishment of the Plan.  The Company hereby adopts and establishes, effective as of the Effective Date, an unfunded deferred compensation plan for Eligible Employees, which shall be known as the Genpact LLC Executive Deferred Compensation Plan.  

1.2Purpose of Plan.  The purpose of the Plan is to provide a select group of management or highly compensated employees (within the meaning of Sections 201(2), 301(a)(3), and 401(a)(1) of ERISA) who contribute significantly to the future business success of the Company with the opportunity to defer the receipt of income that would otherwise become payable to them.  The Plan also provides the Company with the ability to make discretionary supplemental employer contributions on behalf of designated Participants.    

ARTICLE 2

Definitions

The following terms, when used in the Plan with initial capital letters, shall have the meaning given to them in this Article unless a different meaning is clearly intended by the context.

2.1“Acceleration Events” has the meaning set forth in Section 7.5 hereof. 

2.2“Account” means a bookkeeping account(s) established in the name of each Participant and maintained by the Company to reflect a Participant’s interests under the Plan.  A Participant’s Account may be divided into subaccounts as the Plan Administrator deems appropriate.  

2.3“Base Salary” means the annual rate of base pay paid by the Employer to or for the benefit of the Participant for services rendered.  

2.4“Beneficiary” means any person or entity, designated in accordance with Section 11.7, entitled to receive benefits that are payable after a Participant’s death pursuant to the terms of the Plan.

2.5“Benefit Commencement Date” means the Participant’s Separation from Service or specified date irrevocably designated for distribution by the Participant with respect to Deferred Compensation, as set forth in Section 5.4 (or Section 5.7, if applicable).  

2.6“Bonus Compensation” means (a) performance-based compensation earned by a Participant under any bonus or cash incentive plan maintained by the Employer relating to a performance period of one year or more or (b) discretionary bonus compensation paid to a 

Participant by the Employer; provided, however, that Bonus Compensation shall not include any guaranteed bonus earned by a Participant or any commission-related bonuses.      

2.7“Claimant” has the meaning set forth in Section 10.1.

2.8“Code” means the U.S. Internal Revenue Code of 1986, as amended, or any successor statute, and the Treasury Regulations and other authoritative guidance issued thereunder.

2.9“Company” means Genpact LLC, or any successor thereto.

2.10“Deferral Election” means an election by an Eligible Employee to defer Eligible Compensation, or Supplemental Employer Contributions if permitted by the Plan Administrator, in accordance with the terms of the Plan.    

2.11“Deferred Compensation” means deferrals at the election of an Eligible Employee of Eligible Compensation credited to a Participant’s Account. 

2.12“Distribution Date” means the February 1 or August 1 (or such other date(s) as may be designated by the Member), next following the Participant’s Separation from Service; provided in no event will the Distribution Date be sooner than the first day of the seventh month following the Participant’s Separation from Service.

2.13“Effective Date” means July 1, 2018.  

2.14“Election Notice” means the notice or notices established from time to time by the Plan Administrator for making Deferral Elections under the Plan.  The Election Notice includes the amount or percentage of Eligible Compensation to be deferred (subject to any minimum or maximum amounts established by the Plan Administrator) and with respect to Deferral Elections credited to a Participant’s Account, the form of payment, and the Benefit Commencement Date, in accordance with ARTICLE 4 and ARTICLE 5.  Each Election Notice shall become irrevocable as of the last day of the Election Period. 

2.15“Election Period” means the period established by the Plan Administrator with respect to each Plan Year during which Deferral Elections for such Plan Year must be made, as set forth in Section 5.2 and in accordance with Section 409A.

2.16“Eligible Compensation” means the amount of an Eligible Employee’s Base Salary plus Bonus Compensation.    

2.17“Eligible Employee” means an Employee who is at the Band 1 level or above, and such other key management or highly compensated Employee, in both cases as selected by the Member in its discretion as eligible to participate in the Plan.  The Member shall select Eligible Employees initially eligible to participate in the Plan prior to the Effective Date.  Thereafter, the Member may select other (including newly eligible) Eligible Employees quarterly (in March, June, September and December), or pursuant to such other schedule as established by the Plan Administrator.

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2.18“Employee” means, unless determined otherwise by the Plan Administrator in its discretion, who is a regular, full-time U.S. employee of an Employer who provides services in the U.S. and whose compensation is paid in full on the U.S. payroll system (and is not split between U.S. and non-U.S. payroll systems).

2.19“Employer” means the Company or a Participating Employer.

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

2.21“FICA Amount” has the meaning set forth in Section 7.5(b).

2.22“Member” means Genpact International, Inc. or it’s successor

2.23“Participant” means an Eligible Employee who elects to participate in the Plan by filing an Election Notice in accordance with ARTICLE 4 and ARTICLE 5 and any former Eligible Employee who continues to be entitled to a benefit under the Plan.

2.24“Participating Employer” means each subsidiary or affiliate of the Company that is listed on the attached Exhibit A, which the Member has designated as a “Participating Employer” in the Plan and each additional subsidiary or affiliate that the Member subsequently determines shall become a “Participating Employer” in the Plan.

2.25“Plan” means this Genpact LLC Executive Deferred Compensation Plan, as amended from time to time.

2.26“Plan Administrator” means the Vice President of Human Resources, North America or Vice President, Global Compensation and Benefits, or such other individual(s) to whom the Member delegates authority to act as Plan Administrator for purposes of the Plan. 

2.27“Plan Year” means the twelve consecutive month period that begins on January 1 and ends on the following December 31, except that the first Plan Year shall be the period beginning on the Effective Date and ending on December 31, 2018.  

2.28“Section 409A” means Section 409A of the Code and the regulations thereunder.

2.29“Separation from Service” means a Participant’s separation from service with the Employer and its affiliates, which constitutes a “separation from service” under Section 409A(a)(2)(A)(i) of the Code and Treas. Reg. Section 1.409A-1(h).

2.30“Supplemental Employer Contribution” means an amount that may be credited to a Participant’s Account by an Employer.  Whether a Supplemental Employer Contribution will be made and, if so, the amount of any Supplemental Employer Contribution, is in the sole discretion of the Member.  

2.31“State, Local, and Foreign Tax Amount” has the meaning set forth in Section 7.5(e).

 

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ARTICLE 3

PARTICIPATION

3.1Participation.  Each Eligible Employee who completes a Deferral Election in accordance with ARTICLE 4 and ARTICLE 5, and provides such data as is required by the Plan Administrator, shall participate in the Plan in accordance with ARTICLE 4 and ARTICLE 5.  An Eligible Employee who has not completed a Deferral Election but for whom the Member, in its sole discretion, credits Supplemental Employer Contributions shall also participate in the Plan in accordance with its terms.

3.2Cessation of Participation.  If a Participant ceases to be an Eligible Employee during a Plan Year, then the Participant shall not be permitted to make new Deferral Elections or receive Supplemental Employer Contributions following such cessation.

3.3Participant Consent.  By becoming a Participant, an Eligible Employee shall for all purposes be deemed conclusively to have consented to the provisions of the Plan and to all subsequent amendments thereto. 

ARTICLE 4

CONTRIBUTIONS AND VESTING

4.1Deferral Election.  A Participant may elect to defer receipt of between 1% and 80% of the Participant’s Base Salary and between 1% and 100% of Bonus Compensation (or such other minimum and maximum amounts as determined by the Plan Administrator), in increments of 1% only, by completing an Election Notice and submitting it in accordance with Plan procedures during the Election Period.  The Election Notice shall also specify the form of payment as set forth in Section 5.3 and the Benefit Commencement Date as set forth in Section 5.4.  Unless otherwise specified by the Plan Administrator, Base Salary and/or Bonus Compensation deferred under this Section 4.1 shall be credited to a Participant’s Account as soon as practical after the date such amounts would have otherwise been payable to the Participant.

4.2Supplemental Employer Contributions.  In its sole discretion, the Member may make Supplemental Employer Contributions to the Account of any Participant equal to the amount or formula determined by the Member, in its sole discretion.  Supplemental Employer Contributions shall be credited at such times and in such amounts as approved by the Member, in its sole discretion.  If made, Supplemental Employer Contributions need not be uniform nor made to the Accounts of all Participants and a Participant who receives a Supplemental Employer Contribution in one year may or may not receive a discretionary Supplemental Employer Contribution in a subsequent year.

4.3Vesting.  

(a)Amounts Deferred.  A Participant shall be 100% vested at all times in the amount of Eligible Compensation elected to be deferred under this Plan, including any earnings thereon as described in ARTICLE 6.  

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(b)Supplemental Employer Contributions.  A Participant’s Supplemental Employer Contributions, including any earnings thereon as described in ARTICLE 6, shall become vested as determined by the Member at the time the Supplemental Employer Contribution has been approved by the Member, provided that if no vesting schedule is established at that time, the Supplemental Employer Contribution shall vest over a period of two years, with 50% of the Supplemental Employer Contribution vesting on the one year anniversary following the date on which the Supplemental Employer Contribution was approved by the Member and the remaining 50% of the Supplemental Employer Contribution vesting on the second such anniversary, subject in each case to the Participant’s continuing service with the Employer.   

ARTICLE 5

Election ProceDures

5.1Deferral Elections.  An Eligible Employee shall have the opportunity to make a Deferral Election for each Plan Year during the Election Period for such year, in accordance with Section 4.1 and this ARTICLE 5 and any procedures established by the Plan Administrator.  A Deferral Election shall be effective only for the Plan Year for which it is made and shall not apply to any future Plan Year. An Eligible Employee must file a separate Deferral Election for each Plan Year in order to defer Eligible Compensation for such Plan Year.  

5.2Election Period.   

(a)General Rule.  Except as provided in subsections (b), (c) and (d) below, the Election Period shall end no later than the last day of the Plan Year immediately preceding the Plan Year in which the services will be rendered to which the Eligible Compensation subject to the Deferral Election relates, or such earlier period as may be set by the Plan Administrator in its sole discretion.     

(b)Performance-based Compensation.  If any Bonus Compensation constitutes “performance-based compensation” within the meaning of Treas. Reg. Section 1.409A-1(e), then, to the extent permitted by the Plan Administrator, the Election Period for such amounts shall end no later than six months before the end of the performance period for which the Bonus Compensation is earned (and in no event later than the date on which the amount of the Bonus Compensation becomes readily ascertainable).  

(c)Newly Eligible Employees.  Notwithstanding the foregoing subsection (a), if an individual first becomes an Eligible Employee during a Plan Year, the Eligible Employee may make a Deferral Election for such Plan Year with respect to Base Salary so long as the Eligible Employee files the Election Notice on or before the date that is 30 days after the date on which the individual first becomes an Eligible Employee.  The Deferral Election shall apply only to Base Salary earned with respect to services performed after the date on which the Eligible Employee files his or her Election Notice. If an individual first becomes an Eligible Employee during a Plan Year, the Eligible Employee shall not be eligible to make a Deferral Election with respect to Bonus Compensation earned in such Plan Year, and shall only be eligible to make a Deferral Election in accordance with ARTICLE 4 and ARTICLE 5 for Bonus Compensation to be earned in a succeeding Plan Year.

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(d)Special Rules for First Plan Year.  For the first Plan Year beginning on the Effective Date, the Election Period with respect to deferral of (i) any Bonus Compensation that constitutes “performance-based compensation” within the meaning of Treas. Reg. Section 1.409A-1(e) shall end on June 30, 2018 and (ii) any other Eligible Compensation shall end on June 30, 2018 and shall become effective only with respect to such other Eligible Compensation earned commencing August 1, 2018.

5.3Form of Payment.  A Participant may elect to receive his or her Deferred Compensation in a single sum payment or annual installment payments over a term of up to fifteen years.  The form in which the Participant elects to receive payment of his or her Deferred Compensation for a Plan Year shall be irrevocably elected on the Participant’s Election Notice as described in this ARTICLE 5.  If a Participant does not make an election with respect to the form of payment for the Participant’s Deferred Compensation, such Deferred Compensation shall be paid in a lump sum.  

5.4Time of Payment Election.

(a)Timing of Payment.  A Participant shall elect (on the Participant’s Election Notice) to receive or commence payment of the Participant’s Deferred Compensation, in the form elected in Section 5.3, either (i) in any year that is at least two years following the Plan Year (or the end of the performance period with respect to Bonus Compensation, if applicable) for which such election is made, subject to subsection (b) below, or (ii) upon the Participant’s Separation from Service.  

(b)Benefit Commencement Date.  The time (whether a specified year or Separation from Service) which the Participant irrevocably elects on the Participant’s Election Notice to receive, or commence receiving, payment of his or her Deferred Compensation shall be referred to as the Benefit Commencement Date. For the avoidance of doubt, if a Participant elects to receive payments in installments in accordance with Section 5.3 beginning in a specified year, and the Participant has a Separation from Service after the installment payments have begun, the payments shall continue on the regularly scheduled payment dates.      

5.5Default Election.  If a Participant does not make an election with respect to the form of payment and/or the Benefit Commencement Date for the Participant’s Deferred Compensation, such Deferred Compensation shall be paid in a lump sum upon the Participant’s Separation from Service.

5.6Supplemental Employer Contributions.  Except as otherwise designated by the Member at the time it authorizes Supplemental Employer Contributions with respect to a Participant, Supplemental Employer Contributions (adjusted for notional earnings) shall be distributed upon the Participant’s Separation from Service in the form of payment elected by the Participant for payments of the Participant’s Deferred Compensation made upon a Separation from Service.  

5.7Change of Time and/or Form of Payment.  A Participant may subsequently amend the form of payment or the Benefit Commencement Date by filing such amendment with the Plan Administrator.  However, each amendment must provide for a payout as otherwise permitted under this Section at a date no earlier than five years after the date of payment in force 

6

 

immediately prior to the filing of such amendment request, the amendment may not take effect for twelve months after the request is made, and if the Participant designated a specified year as the Benefit Commencement Date (as set forth in Section 5.4(a)(i) above), the amendment must be made not less than twelve months before the payment is scheduled to be paid (i.e., at least a year prior to February 1 of the payment year).  A Participant who has previously elected to receive his or her distribution in the form of installments may only make an election under this Section 5.7 at least a year before the first of the installment payments is made.  For purposes of this Section 5.7, a payment of amounts under this Plan, including the payment of annual installments over a number of years, shall be treated as a single payment, as provided in Treas. Reg. §1-409A-2(b)(2)(iii).  Any amendment under this Section 5.7 must be made in accordance with the requirements of Section 409A.  A Participant may continue to change the time and/or form of payment in accordance with this paragraph for a period of up to ten years following the Participant’s Separation from Service with the Company or otherwise becoming ineligible to participate in the Plan.

ARTICLE 6

ACCOUNTS AND INVESTMENTS   

6.1Establishment of Accounts.  The Company shall establish and maintain an Account for each Participant.  The Company may establish more than one Account on behalf of any Participant as deemed necessary by the Plan Administrator for administrative purposes.  Each Account shall be maintained for bookkeeping purposes only.  Neither the Plan nor any of the Accounts established under the Plan shall hold any actual funds or assets. 

6.2Notional Returns.  

(a)Notional Returns.  Each Participant’s Account shall be credited with earnings and debited with losses in accordance with the return on the hypothetical investment returns on one or more investment funds selected by the Participant among designated by the Plan Administrator, which constitute a “predetermined actual investment” as described in the regulations issued under Section 409A.  The investment funds shall be used only for purposes of measuring the return on the Participant’s Account, and no Participant shall have any interest in any actual investment fund.  The Company shall calculate the return on the hypothetical investments in investment funds on a quarterly or more frequent basis.

(b)Notional Investment Procedures.  The Plan Administrator shall establish procedures by which Participants can change their investment elections among the available investment alternatives.  

(c)Cessation of Accruals.  Notwithstanding anything to the contrary, deemed earnings and losses shall cease accruing for a period of time prior to payment of the Participant’s Account balance (or portion thereof) for administrative purposes related to distributing Plan benefits, as determined by the Plan Administrator in its discretion.

7

 

6.3Statements.  To the extent that the Company does not arrange for Account balances to be accessible online by the Participant, the Plan Administrator shall provide to each Participant a statement showing the balances in the Participant’s Account no less frequently than annually.

 

ARTICLE 7

Distribution of Participant Accounts

7.1Distribution.  A Participant’s Plan benefit payable upon a designated year shall be paid or commence on February 1 of such designated year (or as soon as administratively practicable thereafter, but in no event later than the end of the designated year) and a Participant’s Plan benefit payable upon a Separation from Service shall be paid on the Distribution Date, in each case in the form irrevocably elected by the Participant under Section 5.3 (or deemed elected under Section 5.5 if applicable).  The Participant’s Account shall continue to be adjusted for earnings or losses calculated in accordance with his or her elections under ARTICLE 6 until the date upon which the Participant’s entire Account balance is distributed, or such earlier time as set forth in Section 6.2(c).

7.2Installment Payments.  If a Participant has elected to receive his or her Deferred Compensation in annual installments, the first annual installment shall become payable on date described in Section 7.1.  All subsequent installment payments shall be made each year on the anniversary of such date.  The Participant’s Account shall continue to be adjusted for earnings or losses calculated in accordance with his or her elections until the date on which the Participant’s entire Account balance is distributed, or such earlier time as set forth in Section 6.2(c).  Each annual payment shall be calculated by dividing the remaining value of the Account (or portion thereof subject to the applicable Deferral Election) by the number of remaining annual installment payments to be made to the Participant.

7.3Death.  In the event of a Participant’s death prior to the Participant’s Benefit Commencement Date, the Participant’s Account shall be distributed to the Participant’s Beneficiary in a lump sum within 60 days following the Participant’s death.  In the event of a Participant’s death on or after the Participant’s Benefit Commencement Date, the Beneficiary of such Participant shall receive the Participant’s Account in accordance with the Participant’s election(s) as to the time and form of payment in effect at the Participant’s death.  The Account shall continue to accrue earnings or losses in accordance with ARTICLE 6, until such time as the Account is distributed, or such earlier time as set forth in Section 6.2(c).  

7.4Unforeseeable Emergency.  

(a)Upon the occurrence of an “unforeseeable emergency” (as defined in subsection (b) below and in accordance with Section 409A), a Participant shall be eligible to receive payment of the Participant’s vested Deferred Compensation, but only in an amount reasonably necessary to satisfy the unforeseeable emergency (including reasonably anticipated taxes resulting from such a payment) and only to the extent that such an unforeseeable emergency cannot be relieved (i) through reimbursement or compensation by insurance or otherwise, (ii) by 

8

 

liquidation of the Participant’s assets to the extent such liquidation would not result in a financial hardship, or (iii) by cessation of Elective Deferrals.

(b)For purposes of this Section 7.4, an “unforeseeable emergency” is a severe financial hardship to the Participant resulting from an illness or accident of the Participant, the Participant’s spouse, the Participant’s beneficiary, or the Participant’s dependent (as defined in Section 152 of the Code, without regard to Sections 152(b)(1), (b)(2), and (d)(1)(B)), loss of the Participant’s property due to casualty (including the need to rebuild a home following damage to a home not otherwise covered by insurance), or other similar extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant.  Unforeseeable emergency distributions shall be administered in accordance with Section 409A.   

(c)Notwithstanding anything in the Plan to the contrary, if a Participant receives a payment upon an unforeseeable emergency, the Participant’s Deferral Elections shall cease for the remainder of the Plan Year.  

7.5Permissible Acceleration Events.  Notwithstanding anything in the Plan to the contrary, the Company, in its sole discretion, may accelerate the distribution of all or a portion of a Participant’s Account upon the occurrence of any of the events (“Acceleration Events”) set forth in this Section 7.5.  The Company’s determination of whether distribution may be accelerated in accordance with this Section 7.5 shall be made in accordance with Treas. Reg. Section 1.409A-3(j)(4).

(a)Limited Cashouts.  The Company may accelerate distribution of a Participant’s Account to the extent that (i) the aggregate amount in the Participant’s Account does not exceed the applicable dollar amount under Section 402(g)(1)(B) of the Code, (ii) the distribution results in the termination of the Participant’s entire interest in the Plan and any plans that are aggregated with the Plan pursuant to Treas. Reg. Section 1.409A-1(c)(2), and (iii) the Company’s decision to cash out the Participant’s Account is evidenced in writing no later than the date of distribution. 

(b)Payment of Employment Taxes.  The Company may accelerate distribution of all or a portion of a Participant’s Account (i) to pay the Federal Insurance Contributions Act (FICA) tax imposed under Sections 3101, 3121(a), and 3121(v)(2) of the Code (the “FICA Amount”), or (ii) to pay the income tax at source on wages imposed under Section 3401 of the Code or the corresponding withholding provisions of applicable state, local, or foreign tax laws as a result of the payment of the FICA Amount and the additional income tax at source on wages attributable to the pyramiding Section 3401 wages and taxes; provided, however, that the total payment under this subsection (b) shall not exceed the FICA Amount and the income tax withholding related to the FICA Amount.

(c)Distribution Upon Income Inclusion.  The Company may accelerate distribution of all or a portion of a Participant’s Account to the extent that the Plan fails to meet the requirements of Section 409A, provided that, the amount accelerated shall not exceed the amount required to be included in income as a result of the failure to comply with Section 409A. 

9

 

(d)Termination of the Plan.  The Company may accelerate distribution of all or a portion of a Participant’s Account upon termination of the Plan in accordance with Treas. Reg. Section 1.409A-3(j)(4)(ix).

(e)Payment of State, Local, or Foreign Taxes.  The Company may accelerate distribution of all or a portion of a Participant’s Account in accordance with Treas. Reg. Section 1.409A-3(j)(4)(xi) for:

(i)the payment of state, local, or foreign tax obligations arising from participation in the Plan that apply to an amount deferred under the Plan before the amount is paid or made available to the Participant (the “State, Local, and Foreign Tax Amount”), provided, however, the accelerated payment amount shall not exceed the taxes due as a result of participation in the Plan, and/or 

(ii)the payment of income tax at source on wages imposed under Section 3401 of the Code as a result of such payment and the payment of the additional income tax at source on wages imposed under Section 3401 of the Code attributable to the additional Section 3401 wages and taxes; provided however, the accelerated payment amount shall not exceed the aggregate of the State, Local, and Foreign Tax Amount and the income tax withholding related to such amount.

7.6Certain Offsets.  The Company may accelerate distribution of all or a portion of the Participant’s Account to satisfy a debt of the Participant to the Employer incurred in the ordinary course of the service relationship between the Employer and the Participant, provided, however, the amount accelerated shall not exceed $5,000 and the distribution shall be made at the same time and in the same amount as the debt otherwise would have been due and collected from the Participant.

7.7Payments Subject to Section 162(m). Notwithstanding anything in the Plan to the contrary, the Company may, in its sole discretion, delay payments if the Member reasonably anticipates that if the payment is made as scheduled, the Company’s deduction with respect to such payment would not be permitted to due Code Section 162(m).  If payment is delayed pursuant to this paragraph, then the payment must be made during the Company’s first taxable year in which the Member reasonably anticipates, or should reasonably anticipate, that if the payment is made during such year, the deduction of such payment will not be limited or barred by application of Code Section 162(m).

ARTICLE 8

Plan Administration

8.1Administration By Member.  The Plan shall be administered by the Member, which shall have the authority to:

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

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

10

 

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

(d)determine minimum or maximum amounts, and the types of compensation, that Participants may elect to defer under the Plan;

(e)select, subject to the limitations set forth in the Plan, those Employees who shall be Eligible Employees;

(f)calculate deemed earnings and losses on Accounts;

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

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

The Member may delegate day to day administration of the Plan to the Plan Administrator.  Notwithstanding anything to the contrary, the Member may take any action delegated to the Plan Administrator under the terms of the Plan, and any authority of the Plan Administrator shall be subject to the oversight of the Member.

8.2Non-Uniform Treatment.  The Member’s and the Plan Administrator’s determinations under the Plan need not be uniform and any such determinations may be made selectively among Participants.  Without limiting the generality of the foregoing, the Member and the Plan Administrator shall be entitled, among other things, to make non-uniform and selective determinations with regard to the terms or conditions of any Deferred Compensation.

8.3Plan Administrator Decisions Final.  Subject to ARTICLE 10, all decisions made by the Member and the Plan Administrator pursuant to the provisions of the Plan shall be final and binding on the Company, the Participating Employers, the Participants, and Beneficiaries, and all persons and entities having an interest therein, and by becoming a Participant, an Eligible Employee shall be deemed to have acknowledged and accepted the Member’s and the Plan Administrator’s authority and discretion.

8.4Indemnification.  The Member and the Plan Administrator and any designee shall not 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 gross negligence or wilful misconduct. 

ARTICLE 9

Amendment and Termination.  

Subject to the applicable requirements of Section 409A, the Member may, at any time, and in its discretion, alter, amend, modify, suspend, or terminate the Plan or any portion thereof, provided, however, that no such alteration, amendment, modification, suspension, or termination 

11

 

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.    

ARTICLE 10

Claims Procedures.

10.1Filing a Claim.  Any Participant or other person claiming an interest in the Plan (the “Claimant”) may file a claim in writing with the Plan Administrator.  The Plan Administrator shall review the claim itself or appoint an individual or entity to review the claim.

10.2Claim Decision.  The Claimant shall be notified within 90 days after the claim is filed whether the claim is approved or denied, unless the Plan Administrator determines that special circumstances require an extension of time, in which case the Plan Administrator may have up to an additional 90 days to process the claim.  If the Plan Administrator determines that an extension of time for processing is required, the Plan Administrator shall furnish written or electronic notice of the extension to the Claimant before the end of the initial 90-day period.  Any notice of extension shall describe the special circumstances necessitating the additional time and the date by which the Plan Administrator expects to render its decision.

10.3Notice of Denial.  If the Plan Administrator denies the claim, it must provide to the Claimant, in writing or by electronic communication, a notice which includes:

(a)The specific reason(s) for the denial;

(b)Specific reference to the pertinent Plan provisions on which such denial is based;

(c)A description of any additional material or information necessary for the Claimant to perfect his or her claim and an explanation of why such material or information is necessary; and

(d)A description of the Plan’s appeal procedures and the time limits applicable to such procedures, including a statement of the Claimant’s right to bring a civil action under Section 502(a) of ERISA following a denial of the claim on appeal.

10.4Appeal Procedures.  A request for appeal of a denied claim must be made in writing to the Plan Administrator within 60 days after receiving notice of denial.  The decision on appeal shall be made within 60 days after the Plan Administrator’s receipt of a request for appeal, unless special circumstances require an extension of time for processing, in which case a decision shall be rendered not later than 120 days after receipt of a request for appeal.  A notice of such an extension must be provided to the Claimant within the initial 60-day period and must explain the special circumstances and provide an expected date of decision.  The reviewer shall afford the Claimant an opportunity to review and receive, upon request and without charge, all relevant all documents, records, and other information relevant to the Claimant’s claim for benefits and to submit to the Plan Administrator written comments, documents, records, and other information relating to the claim for benefits.  The reviewer shall take into account all comments, documents, records, and other information submitted by the Claimant relating to the claim regardless of whether the information was submitted or considered in the initial benefit determination. 

12

 

10.5Notice of Decision on Appeal.  If the Plan Administrator denies the appeal, it must provide to the Claimant, in writing or by electronic communication, a notice which includes:

(a)The specific reason(s) for the denial;

(b)Specific references to the pertinent Plan provisions on which such denial is based;

(c)A statement that the Claimant may receive on request and without charge reasonable access to, and copies of, all documents, records, and other information relevant to the claimant’s claim for benefits;

(d)A description of the Plan’s voluntary procedures and deadlines, if any; and

(e)A statement of the Claimant’s right to sue under Section 502(a) of ERISA.

10.6Claims Procedures Mandatory.  The internal claims procedures set forth in this ARTICLE 10 are mandatory.  If a Claimant fails to follow these claims procedures, or to timely file a request for appeal in accordance with this ARTICLE 10, the denial of the Claim shall become final and binding on all persons for all purposes.

ARTICLE 11

Miscellaneous.

11.1No 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 Employer or interfere in any way with the right of the Employer to terminate the Participant’s employment or service at any time with or without notice and with or without cause.

11.2Unfunded Obligation.  Until deferred benefits hereunder are distributed in accordance with the terms of the Plan, the interest of each Participant and Beneficiary therein is contingent only.  Title to and beneficial ownership of any assets, which the Company may set aside or earmark to meet its obligations with respect to Participant Accounts hereunder shall at all times remain the property of the Company.  All Participants and Beneficiaries are general unsecured creditors of the Company with respect to the benefits due hereunder, and the Plan constitutes an agreement by the Company to make benefit payments in the future.  It is the intention of the Company that the Plan be considered unfunded for tax purposes.

11.3No Trust Obligation.  In order to meet its obligations hereunder, funds may be set aside or earmarked by the Company.  These funds may be kept in cash, or invested and reinvested, at the discretion of the Plan Administrator.  The Company may, but is not required to, establish a grantor trust which may be used to hold assets of the Company which are maintained as reserves against the Company’s unfunded, unsecured obligations hereunder.  Such reserves shall at all times be subject to the claims of the Company’s creditors.  To the extent such trust or other vehicle is established, and assets contributed, for the purpose of fulfilling the Company’s obligation hereunder, then such obligation of the Company shall be reduced to the extent such assets are utilized to meet its obligations hereunder.

13

 

11.4Tax 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.

11.5Section 409A of the Code.

(a)The Plan is intended to comply with the requirements of Section 409A, and shall in all respects be administered in accordance with Section 409A.  Notwithstanding the foregoing, the Company makes no representation that the Plan complies with Section 409A and the Company and the Participating Employers shall have no liability to any Participant for any failure to comply with Section 409A.  

(b)Notwithstanding anything in the Plan to the contrary, distributions may only be made under the Plan upon an event and in a manner permitted by Section 409A, and all payments to be made upon a termination of employment under this Plan may only be made upon a “separation from service” as defined under Section 409A.  All amounts to be distributed under this Plan shall be paid, or commence to be paid, within 60 days after the Benefit Commencement Date, subject to the six-month delay described below, if applicable, or the applicable anniversary in the case of installment payments, but in no event shall a payment be made after December 31 of the calendar year in which the payment is scheduled to be made, or otherwise in accordance with Section 409A.  In no event shall a Participant, directly or indirectly, designate the calendar year of payment, except as permitted by Section 409A.  

(c)Notwithstanding anything in the Plan to the contrary, if a Participant’s distribution is to commence, or be paid upon, Separation from Service, payment of the distribution shall be delayed for a period of six months after the Participant’s Separation from Service, if the Participant is a “specified employee” as defined under Section 409A (as determined by the Plan Administrator) and if required pursuant to Section 409A (“six-month delay”).  If payment is delayed, the Participant’s distribution shall commence, or be paid, within 30 days of the date that is the six-month anniversary of the Participant’s Separation from Service.  If the Participant dies during the six-month delay, the accumulated postponed amount shall be paid as described in Section 7.3.

(d)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, all amounts deferred under this Plan shall be aggregated with amounts deferred under other account balance plans.

11.6No Warranties.  Neither the Company, nor the Participating Employers, nor the Plan Administrator warrants or represents that the value of any Participant’s Account will increase.  Each Participant assumes the risk in connection with the deemed investment of his or her Account.

11.7Beneficiary Designation.  Each Participant under the Plan may from time to time name any 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 Plan Administrator and shall be effective only when filed by the Participant in writing with the Company during the Participant’s 

14

 

lifetime.  If a Participant fails to designate a Beneficiary, then the Participant’s designated Beneficiary shall be deemed to be the Participant’s estate.

11.8No 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).  For the avoidance of doubt, a Participant’s right to benefits under this Plan may not be assigned to an alternate payee in connection with the Participant’s divorce or separation.

11.9Expenses.  The costs of administering the Plan shall be charged to Participant Accounts, unless paid for by the Company or a Participating Employer, as determined by the Company in its discretion.

11.10Severability.  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.

11.11Successors.  The Plan shall be binding upon and insure to the benefit of the Company, its successors and assigns, and the Participants and their heirs, executors, administrators, and legal representatives.

11.12Headings 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.

11.13Governing Law.  The Plan shall be administered, construed, and governed in all respects under and by the laws of the State of New York, without reference to the principles of conflicts of law (except and to the extent pre-empted by applicable Federal law).  

 

 

15

 

 

Exhibit A

 

Participating Employers

 

	
 
	
1.
	
Genpact LLC

	
 
	
2.
	
Headstrong Services, LLC

	
 
	
3.
	
Genpact Insurance Administration Services Inc.

	
 
	
4.
	
Genpact International, Inc.

	
 
	
5.
	
Genpact Onsite Services, Inc.

	
 
	
6.
	
Genpact WB LLC

	
 
	
7.
	
Genpact Mortgage Services, Inc.

	
 
	
8.
	
BrightClaim, LLC

	
 
	
9.
	
OnSource, LLC

	
 
	
10.
	
LeaseDiminsions, Inc.

	
 
	
11.
	
TandemSeven, Inc.

	
 
	
12.
	
PNMSoft USA Inc.

	
 
	
13.
	
Pharmalink Consulting Inc.

	
 
	
14.
	
Jawood Business Process Solutions, LLC

	
 
	
15.
	
RAGE Frameworks, Inc.

	
 
	
16.
	
Endeavour Software Technologies Inc.

	
 
	
17.
	
National Vendor, LLC

 

16

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