Document:

exh_101.htm

EXHIBIT 10.1

 

THERMON GROUP HOLDINGS, INC.

2012 SHORT-TERM INCENTIVE PLAN

 

Purposes

 

        The purpose of the Thermon Group Holdings, Inc. Incentive Plan (the "Plan") is to retain and motivate the officers and other employees of Thermon Group Holdings, Inc. and its subsidiaries who have been designated by the Committee to participate in the Plan for a specified Performance Period by providing them with the opportunity to earn incentive payments based upon the extent to which specified performance goals have been achieved or exceeded for the Performance Period. It is intended that all amounts payable to Participants who are "covered employees" within the meaning of Section 162(m) of the Code will constitute "qualified performance-based compensation" within the meaning of U.S. Treasury regulations promulgated thereunder, and the Plan and the terms of any Awards hereunder shall be so interpreted and construed to the maximum extent possible.

 

Definitions

 

         " Annual Base Salary " shall mean for any Participant an amount equal to the rate of annual base salary in effect or approved by the Committee or other authorized person at the time or immediately before performance goals are established for a Performance Period, including any base salary that otherwise would be payable to the Participant during the Performance Period but for his or her election to defer receipt thereof.

 

         " Applicable Period " shall mean, with respect to any Performance Period, a period commencing on or before the first day of the Performance Period and ending not later than the earlier of (a) the 90 th day after the commencement of the Performance Period and (b) the date on which twenty-five percent (25%) of the Performance Period has elapsed. Any action required to be taken within an Applicable Period may be taken at a later date if permissible under Section 162(m) of the Code or U.S. Treasury regulations promulgated thereunder.

 

         " Award " shall mean an award to which a Participant may be entitled under the Plan if the performance goals for a Performance Period are satisfied. An Award may be expressed in U.S. dollars or pursuant to a formula that is consistent with the provisions of the Plan.

 

         " Board " shall mean the Board of Directors of the Company.

 

         " Code " shall mean the Internal Revenue Code of 1986, as amended.

 

         " Committee " shall mean the Compensation Committee of the Board comprised of members of the Board that are "outside directors" within the meaning of Section 162(m) of the Code, or such other committee designated by the Board that satisfies any then applicable requirements of the principal national stock exchange on which the common stock of the Company is then traded to constitute a compensation committee, and which consists of two or more members of the Board, each of whom is an "outside director" within the meaning of Section 162(m) of the Code.

 

         " Company " shall mean Thermon Group Holdings, Inc., a Delaware corporation, and any successor thereto.

 

         " Participant " shall mean an officer or other employee of the Company or any of its subsidiaries who is designated by the Committee to participate in the Plan for a Performance Period, in accordance with Article III.

 

         " Performance Period " shall mean any period commencing on or after April 1, 2012 for which performance goals are established pursuant to Article IV. A Performance Period may be coincident with one or more fiscal years of the Company or a portion of any fiscal year of the Company.

 

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         " Plan " shall mean the Thermon Group Holdings, Inc. Incentive Plan as set forth herein, as it may be amended from time to time.

 

Administration

 

        General.     The Plan shall be administered by the Committee, which shall have the full power and authority to interpret, construe and administer the Plan and Awards granted hereunder (including in each case reconciling any inconsistencies, correcting any defaults and addressing any omissions). The Committee's interpretation, construction and administration of the Plan and all its determinations hereunder shall be final, conclusive and binding on all persons for all purposes.

 

        Powers and Responsibilities.     The Committee shall have the following discretionary powers, rights and responsibilities in addition to those described in Section 3.1 .

 

	 	
(a)

	
to designate within the Applicable Period the Participants for a Performance Period;

	 	
(b)

	
to establish within the Applicable Period the performance goals and targets and other terms and conditions that are to apply to each Participant's Award;

	 	
(c)

	
to certify in writing prior to the payment with respect to any Award that the performance goals for a Performance Period and other material terms applicable to the Award have been satisfied;

	 	
(d)

	
subject to Section 409A of the Code, to determine whether, and under what circumstances and subject to what terms, an Award is to be paid on a deferred basis, including whether such a deferred payment shall be made solely at the Committee's discretion or whether a Participant may elect deferred payment; and

	 	
(e)

	
to adopt, revise, suspend, waive or repeal, when and as appropriate, in its sole and absolute discretion, such administrative rules, guidelines and procedures for the Plan as it deems necessary or advisable to implement the terms and conditions of the Plan.

 

        Delegation of Power.     The Committee may delegate some or all of its power and authority hereunder to the Chief Executive Officer or other executive officer of the Company as the Committee deems appropriate; provided , however , that with respect to any person who is a "covered employee" within the meaning of Section 162(m) of the Code or who, in the Committee's judgment, is likely to be a covered employee at any time during the applicable Performance Period or during any period in which an Award may be paid following a Performance Period, only the Committee shall be permitted to (a) designate such person to participate in the Plan for such Performance Period, (b) establish performance goals and Awards for such person, and (c) certify the achievement of such performance goals.

 

Performance Goals

 

        Establishing Performance Goals.     The Committee shall establish within the Applicable Period of each Performance Period one or more objective performance goals (the outcome of which, when established, shall be substantially uncertain) for each Participant or for any group of Participants (or both). Performance goals shall be based exclusively on one or more of the following objective corporate-wide or subsidiary, division, operating unit or individual measures: the attainment by a share of the Company's common stock of a specified fair market value for a specified period of time, earnings per share, return to stockholders (including dividends), return on assets, return on equity, our earnings before or after taxes and/or interest, revenues, expenses, market share, cash flow or cost reduction goals, interest expense after taxes, return on investment, return on investment capital, return on operating costs, economic value created, operating margin, gross margin, achievement of annual operating profit plans, net income before or after taxes, pretax earnings before interest, depreciation

 

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and/or amortization, pretax operating earnings after interest expense and before incentives, and/or extraordinary or special items, operating earnings, net cash provided by operations, and strategic business criteria, consisting of one or more objectives based on meeting specified market penetration, geographic business expansion goals, cost targets, days sales outstanding goals, customer satisfaction, attainment of specified safety metrics, reductions in errors and omissions, reductions in lost business, management of employment practices and employee benefits, supervision of litigation and information technology, quality and quality audit scores, productivity, efficiency, and goals relating to acquisitions or divestitures, or any combination of the foregoing. Each such goal may be expressed on an absolute or relative basis and may include comparisons based on current internal targets, the past performance of the Company (including the performance of one or more subsidiaries, divisions, or operating units) or the past or current performance of other companies (or a combination of such past and current performance). In the case of earnings-based measures, in addition to the ratios specifically enumerated above, performance goals may include comparisons relating to capital (including, but not limited to, the cost of capital), stockholders' equity, shares outstanding, assets or net assets, or any combination thereof. With respect to Participants who are not "covered employees" within the meaning of Section 162(m) of the Code and who, in the Committee's judgment, are not likely to be covered employees at any time during the applicable Performance Period or during any period in which an Award may be paid following a Performance Period, the performance goals established for the Performance Period may consist of any objective or subjective corporate-wide or subsidiary, division, operating unit or individual measures, whether or not listed herein. Performance goals shall be subject to such other special rules and conditions as the Committee may establish at any time within the Applicable Period; provided , however , that to the extent such goals relate to Awards to "covered employees" within the meaning of Section 162(m) of the Code, such special rules and conditions shall not be inconsistent with the provisions of Treasury regulation Section 1.162-27(e) or any successor regulation describing "qualified performance-based compensation."

 

        Impact of Extraordinary Items or Changes in Accounting.     The measures utilized in establishing performance goals under the Plan shall, to the extent applicable ( i.e ., if the relevant performance goal is based on a GAAP measure), be determined in accordance with GAAP and in a manner consistent with the methods used in the Company's audited consolidated financial statements, without regard to (a) extraordinary or other nonrecurring or unusual items, as determined by the Company's independent public accountants in accordance with GAAP, (b) changes in accounting, as determined by the Company's independent public accountants in accordance with GAAP, or (c) special charges, such as restructuring or impairment charges, unless, in each case, the Committee decides otherwise within the Applicable Period or as otherwise required under Section 162(m) of the Code.

 

Terms of Awards

 

        Performance Goals and Targets.     At the time performance goals are established for a Performance Period, the Committee also shall establish an Award opportunity for each Participant or group of Participants, which shall be based on the achievement of one or more specified targets of performance goals. The targets shall be expressed in terms of an objective formula or standard which may be based upon the Participant's Annual Base Salary or a multiple thereof. In all cases the Committee shall have the sole and absolute discretion to reduce the amount of any payment with respect to any Award that would otherwise be made to any Participant or to decide that no payment shall be made. With respect to each Award, the Committee may establish terms regarding the circumstances in which a Participant will be entitled to payment notwithstanding the failure to achieve the applicable performance goals or targets ( e.g. , where the Participant's employment terminates due to death or disability or where a change in control of the Company occurs); provided , however , that with respect to any Participant who is a "covered employee" within the meaning of Section 162(m) of the Code, the Committee shall not establish any such terms that would cause an Award payable upon the achievement of the performance

 

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goals not to satisfy the conditions of Treasury regulation Section 1.162-27(e) or any successor regulation describing the "qualified performance-based compensation."

 

        Payments.     At the time the Committee determines an Award opportunity for a Participant, the Committee shall also establish the payment terms applicable to such Award. Such terms shall include when such payments will be made; provided , however , that the timing of such payments shall in all instances either (A) satisfy the conditions of an exception from Section 409A of the Code ( e.g. , the short-term deferrals exception described in Treasury Regulation Section 1.409A-1(b)(4)), or (B) comply with Section 409A of the Code and provided , further , that in the absence of such terms regarding the timing of payments, such payments shall occur no later than the later of (1) the 15th day of the third month of the calendar year following the calendar year in which the Participant's right to payment ceased being subject to a substantial risk of forfeiture, and (2) the 15th day of the third month of the Company's fiscal year following the Company's fiscal year in which the Participant's right to payment ceased being subject to a substantial risk of forfeiture.

 

        Maximum Awards.     No Participant shall receive a payment under the Plan with respect to any Performance Period having a value in excess of $2,000,000, which maximum amount shall be proportionately adjusted with respect to Performance Periods that are less than or greater than one year in duration.

 

General

 

        Effective Date.     The Plan shall be submitted to the stockholders of the Company for approval at the 2012 annual meeting of stockholders and, if approved by the affirmative vote of a majority of the shares of common stock present in person or represented by proxy at such meeting, shall become effective for Performance Periods beginning on and after April 1, 2012. In the event that the Plan is not approved by the stockholders of the Company, the Plan shall be null and void with respect to Participants who are "covered employees" within the meaning of Section 162(m) of the Code.

 

        Amendments and Termination.     The Board may amend the Plan as it shall deem advisable, subject to any requirement of stockholder approval required by applicable law, rule or regulation, including Section 162(m) of the Code. The Board may terminate the Plan at any time.

 

        Non-Transferability of Awards.     No award under the Plan shall be transferable other than by will, the laws of descent and distribution or pursuant to beneficiary designation procedures approved by the Company. Except to the extent permitted by the foregoing sentence, no award may be sold, transferred, assigned, pledged, hypothecated, encumbered or otherwise disposed of (whether by operation of law or otherwise) or be subject to execution, attachment or similar process. Upon any attempt to sell, transfer, assign, pledge, hypothecate, encumber or otherwise dispose of any such award, such award and all rights thereunder shall immediately become null and void.

 

        Tax Withholding.     The Company shall have the right to require, prior to the payment of any amount pursuant to an award made hereunder, payment by the Participant of any Federal, state, local or other taxes which may be required to be withheld or paid in connection with such award.

 

        No Right of Participation or Employment.     No person shall have any right to participate in the Plan. Neither the Plan nor any award made hereunder shall confer upon any person any right to continued employment by the Company or any subsidiary or affiliate of the Company or affect in any manner the right of the Company or any subsidiary or affiliate of the Company to terminate the employment of any person at any time without liability hereunder.

 

        Designation of Beneficiary.     If permitted by the Company, a Participant may file with the Committee a written designation of one or more persons as such Participant's beneficiary or beneficiaries (both primary and contingent) in the event of the Participant's death. Each beneficiary

 

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designation shall become effective only when filed in writing with the Committee during the Participant's lifetime on a form prescribed by the Committee. The spouse of a married Participant domiciled in a community property jurisdiction shall join in any designation of a beneficiary other than such spouse. The filing with the Committee of a new beneficiary designation shall cancel all previously filed beneficiary designations. If a Participant fails to designate a beneficiary, or if all designated beneficiaries of a Participant predecease the Participant, then any amount payable with respect to an award after a Participant's death shall be payable to the Participant's executor, administrator, legal representative or similar person.

 

        Governing Law.     The Plan and each award hereunder, and all determinations made and actions taken pursuant thereto, to the extent not otherwise governed by the Code or the laws of the United States, shall be governed by the laws of the State of Delaware and construed in accordance therewith without giving effect to principles of conflicts of laws.

 

        Other Plans.     Payments pursuant to the Plan shall not be treated as compensation for purposes of any other compensation or benefit plan, program or arrangement of the Company or any of its subsidiaries, unless either (a) such other plan provides that compensation such as payments made pursuant to the Plan are to be considered as compensation thereunder or (b) the Board or the Committee so determines in writing. Neither the adoption of the Plan nor the submission of the Plan to the Company's stockholders for their approval shall be construed as limiting the power of the Board or the Committee to adopt such other incentive arrangements as it may otherwise deem appropriate.

 

        Binding Effect.     The Plan shall be binding upon the Company and its successors and assigns and the Participants and their beneficiaries, personal representatives and heirs. If the Company becomes a party to any merger, consolidation or reorganization, then the Plan shall remain in full force and effect as an obligation of the Company or its successors in interest, unless the Plan is amended or terminated pursuant to Section 6.2.

 

        Unfunded Arrangement.     The Plan shall at all times be entirely unfunded and no provision shall at any time be made with respect to segregating assets of the Company for payment of any benefit hereunder. No Participant shall have any interest in any particular assets of the Company or any of its affiliates by reason of the right to receive a benefit under the Plan and any such Participant shall have only the rights of an unsecured creditor of the Company with respect to any rights under the Plan.

 

 

 

A-5Exhibit 10.1

 Exhibit 10.1 
 SEPARATION AGREEMENT 
 This SEPARATION AGREEMENT (this
“Agreement”), dated as of April 27, 2012, is entered into by and between Victoria D. Harker (“Employee”) and The AES Corporation (the “Company”). 

W I T N E S S E T H 

WHEREAS, Employee’s terms and conditions of employment with the Company and its subsidiaries are governed by an employment
agreement, dated as of December 29, 2008, between Employee and the Company (the “Employment Agreement”); 

WHEREAS, effective as of May 7, 2012 (the “Resignation Date”), Employee will resign from the position of Chief
Financial Officer of the Company, resign from all other officer positions that she has with or through the Company and its subsidiaries, and resign from the boards of directors of any subsidiaries of the Company on which she serves; and 

WHEREAS, Employee will terminate her employment with the Company and all of its subsidiaries, effective not later than August 10,
2012, it being understood that either Employee or the Company may terminate Employee’s employment earlier than August 10, 2012 by providing a notice of termination to the other party at any time after June 10, 2012, which notice shall
be effective no less than 15 days prior to the effective date of such termination (the date of such termination, the “Separation Date”); and 
 WHEREAS, for the avoidance of doubt, the Separation Date shall be a date no earlier than June 25, 2012 and no later than August 10, 2012; 

NOW, THEREFORE, in consideration of the premises, representations, covenants and obligations herein contained, the Company and Employee
hereby agree as follows: 
 1. Separation. 

(a) Effective as of the Resignation Date, Employee shall no longer serve as the Chief Financial Officer of the Company or
otherwise as an officer of the Company or as an officer or director of any of the Company’s subsidiaries. During the period between the date of this Agreement and the Resignation Date, Employee shall continue to perform her duties as directed
by the Chief Executive Officer of the Company. 
 (b) Effective as of the Separation Date, Employee shall resign
as an employee of the Company and each of its subsidiaries if her employment was not earlier terminated by the Company or by reason of her death or Disability (within the meaning of the Employment Agreement (“Disability”)). During
the period between the Resignation Date and the Separation Date, Employee will assist the Company as may be reasonably requested by the Company’s Board of Directors, the Company’s Chief Executive Officer or the Company’s General
Counsel. 
 (c) Employee shall not hold herself out in any manner inconsistent with the foregoing provisions of
this Section 1. 
 2. Status of Employment Agreement. Except as provided in Section 1 above and
Section 3 below, the Employment Agreement shall remain in full force and effect, including without limitation Sections 9,10, 11, 12, 17 and 18 thereof, which are incorporated by reference herein. 

3. Separation Payments and Benefits. Provided that (a) Employee does not resign her employment before June 10,
2012, (b) Employee adheres to the terms of this Agreement, (c) during the period beginning on the date of her separation from service and ending forty-five (45) days thereafter, Employee (or her duly authorized representative in the
event of her death or Disability) executes and does not revoke the release of 

 
claims attached hereto as Exhibit A (the “Release”), and (d) on or before the Separation Date or her earlier death or Disability Employee commits no action that would
justify the termination of her employment for Cause within the meaning of Section 7(c)(ii) of the Employment Agreement, Employee’s separation from service on the Separation Date or upon her earlier death or Disability shall be treated as a
separation from service described in Section 8(e) of the Employment Agreement without any requirement for a Notice of Termination as otherwise provided in the Employment Agreement, and upon such separation from service, Employee shall be
entitled to payments and benefits in accordance with Section 8(a) and Section 8(e) of the Employment Agreement, taking into account the provisions of Sections 8(i), 11(g) and 19 of the Employment Agreement. 

4. Consultation with Attorney/Voluntary Agreement. Employee acknowledges that (a) the Company has advised Employee of
her right to consult with an attorney of Employee’s own choosing prior to executing this Agreement, (b) Employee has carefully read and fully understands all of the provisions of this Agreement, and (c) Employee is entering into this
Agreement knowingly, freely and voluntarily in exchange for good and valuable consideration, including without limitation the obligations of the Company under this Agreement. 
 5. Assignment. This Agreement is personal to Employee and may not be assigned by Employee, but any benefit conveyed to Employee pursuant to this Agreement shall inure to the benefit of
Employee and Employee’s heirs or beneficiaries. This Agreement is binding on. and will inure to the benefit of, the Company, the Released Parties (within the meaning of the Release) and their respective successors and assigns. 

6. Counterparts. This Agreement may be executed simultaneously in counterparts, each of which shall be an original, but all
of which shall constitute but one and the same agreement. A faxed signature shall operate the same as an original signature. 

7. Enforceability. In the event that any one or more of the provisions of this Agreement are held to be invalid, illegal or
unenforceable, the remainder hereof shall be equitably interpreted to give the fullest effect to the intent of the parties. 

8. No Oral Modification; No Waivers. This Agreement may not be changed orally, but may be changed only in a writing signed
by a duly authorized representative of the Company and Employee. The failure of the Company or Employee to enforce any of the terms, provisions or covenants of this Agreement will not be construed as a waiver of the same or of the right of the
Company or Employee to enforce the same. Waiver by the Company or Employee of any breach or default by another party to this Agreement of any term or provision of this Agreement will not operate as a waiver of any other breach or default.

 9. Entire Agreement and Third-Party Beneficiaries. This Agreement together with the Employment Agreement sets
forth the entire understanding between the Company and Employee, and supersedes all prior agreements, representations, discussions, negotiations and understandings, concerning the subject matter addressed herein. The Company and Employee represent
that, in executing this Agreement, each party has not relied upon any representation or statement made by the other party, other than those set forth herein and in the Employment Agreement, with regard to the subject matter, basis or effect of this
Agreement. Each subsidiary of the Company is an intended third-party beneficiary of this Agreement. 
 10. Governing
Law. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of Virginia without regard to its conflicts of law principles. 

  
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 IN WITNESS WHEREOF, the Company and Employee have executed this Agreement as of the date
first set forth above. 
  

	
	
	VICTORIA D. HARKER
	
	/s/ Victoria D. Harker

  

			
	THE AES CORPORATION
	
	/s/ Brian A. Miller
	Name:	 	Brian A. Miller
	Title:	 	Executive Vice-President, General Counsel & Corporate Secretary

  
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 Exhibit A 
 FORM OF RELEASE 
 RELEASE OF CLAIMS 

In exchange for the payments and benefits to be provided pursuant to Section 3 of the Separation Agreement between Victoria D.
Harker (“you) and The AES Corporation (the “Company”), dated as of April 27, 2012 (the “Separation Agreement”), you hereby agree as follows: 
 1. You hereby release the Company and all of its past, present and/or future related entities, including but not limited to parents, divisions, affiliates and subsidiaries, and each of their respective
officers, directors, stockholders, trustees, employees, agents, representatives, administrators, attorneys, insurers and fiduciaries, and each of their respective predecessors, successors and assigns, in their individual and/or representative
capacities (hereinafter collectively referred to as the “Released Parties”) from any and all causes of action, suits, agreements, promises, damages, disputes, controversies, contentions, differences, judgments, claims and demands of any
kind whatsoever (“Claims”) which you or your heirs, executors, administrators, successors and assigns ever had, now have or may have against the Released Parties, whether known or unknown to you, and whether asserted or unasserted,
(a) by reason of your employment and/or cessation of employment with the Company, that involve facts which occurred on or prior to the date that you sign this Release of Claims. Such released Claims include, without limitation, any and all
Claims under the Age Discrimination in Employment Act of 1967, as amended by the Older Workers’ Benefit Protection Act of 1990, Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1871, the Civil Rights Act of 1991, the Fair
Labor Standards Act, the Family and Medical Leave Act of 1993, the Americans With Disabilities Act, the Employee Retirement Income Security Act of 1974 (including, without limitation, any claim for severance pay), the Sarbanes-Oxley Act, the
Dodd-Frank Wall Street Reform and Consumer Protection Act, Virginia Human Rights Law and any and all other federal, state or local laws, statutes, rules and regulations pertaining to employment (each as amended) including but not limited to the laws
of the United States and any other country to the extent applicable; any and all Claims under state contract or tort law; any and all Claims based on the design or administration of any Company employee benefit plan (other than claims for welfare
benefit payments with respect to events occurring or expenses incurred prior to the date you execute this Release of Claims) or program; (b) arising under any Company policy, procedure, or employee benefit plan, including, but not limited to,
the Employment Agreement between you and the Company dated December 29, 2008 (your “Employment Agreement”); (c) for wages, commissions, bonuses, continued employment with the Company in any position, and compensatory, punitive or
liquidated damages; and (d) for attorneys’ fees and costs. Notwithstanding the foregoing, nothing contained herein shall interfere with or waive: (i) your right to enforce the Separation Agreement; (ii) your right to any amounts
or any benefits (including, without limitation, payments pursuant to the indemnification rights provided for under Section 5(g) of your Employment Agreement, that either are intended to survive your termination of employment or that arise or
are payable after the date that you execute this Release of Claims (together with any claims for welfare benefit payments with respect to events occurring or expenses incurred prior to the date you execute this Release of Claims your “Preserved
Rights”)); or (iii) any rights that cannot be waived under applicable law. 
 2. Except for the payments and benefits
set forth in Section 3 of the Separation Agreement and your Preserved Rights, you (a) are not entitled to any other payments or benefits from the Company or any of the other Released Parties, and (b) will not seek or be entitled to
obtain any personal recovery in any action against the Company. 
 3. You have had forty-five (45) days to execute this
Release of Claims from the date you first received it. You then have seven (7) days following its execution to revoke your consent to it. 

  
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 4. You (a) have been advised by the Company of your right to consult with an attorney
of your own choosing prior to executing this Release of Claims, (b) have carefully read and fully understands all of the provisions of this Release of Claims, and (c) are entering into this Release of Claims knowingly, freely and
voluntarily in exchange for good and valuable consideration, including without limitation the obligations of the Company under the Separation Agreement. 
 5. The validity, interpretation, construction and performance of this Release of Claims shall be governed by the laws of the State of Virginia without regard to its conflicts of law principles.

  

	
	
	/s/ Victoria D. Harker
	Victoria D. Harker

 DATE: April 27, 2012 

  
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