Document:

Exhibit 10.25

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

 

Confidential

 

 

February 3, 2016

Dr. [***]

[***]

Nemus Bioscience, Inc.

650 Town Center Drive

Suite 1770

Costa Mesa, CA 92626

Dear Dr. [***],

Pursuant to your recent request, Albany Molecular Research, Inc. (“AMRI”) is pleased to provide Nemus Bioscience, Inc. (“Nemus”) with this proposal for the process development, an estimate for the non-GMP production of [***], the analytical method development and qualification, an estimate for the cGMP production of [***], and a stability study. This proposal, together with the terms and conditions attached hereto as Exhibit A (“Terms and Conditions”), constitute one binding agreement between AMRI and Nemus (the “Agreement”).

This proposal is separated into five parts that are detailed in this document. Below is a summary of our proposal as well as the fees associated with this work. Further details of the work are set out later in this proposal.

 

	
Part

	
Description

	
[***]

Fee

	
[***]

Expenses

	
Anticipated Timeframe

	
I.

	
Process Development

	
[***]

	
[***]

	
[***]

	
 

 

II.

	
[***]

	
 

[***]

	
 

[***]

	
 

[***]

	
 

III.

	
Analytical Method

Development and

Qualification

	
 

$142,900

	
 

[***]

	
 

[***]

	
 

 

IV.

	
[***]

	
 

[***]

	
 

[***]

	
 

[***]

	
 

V.

	
 

[***]

	
 

[***]

	
 

[***]

	
 

[***]

	
Total:

	
[***]

 

Any costs indicated to be “non-binding estimates” are intended to be good faith estimates. The parties agree that [***]. However, Nemus will not be responsible for payment of [***].

 

AMRI Proposal #151116-154113c3

Dr. [***]

Nemus Bioscience, Inc. February 3, 2016

Page 2 of 13

 

Please note that this proposal is based on the technical information provided by Nemus. The parties acknowledge that the performance of these tasks may result in deviations or results unforeseen by either party. In the event any given step of manufacture, or final product [***] through no fault of AMRI, for reasons including but not limited to, [***], the parties shall mutually agree in writing on a supplemental proposal or work order [***] to investigate and address such [***], deviation or out of specification result.

Subject to exceptions for AMRI Proprietary Technology (as defined below), any and all results, inventions, compounds, materials, reports, data, Certificates of Analysis, or other deliverables generated by AMRI, in whole or in part, in the direct performance of this project shall accrue to Nemus as the work is being performed, and provided that Nemus pays all invoices submitted by AMRI in performance of the work contemplated hereunder that are consistent with this proposal. “AMRI Proprietary Technology” means all intellectual property, know-how, ideas, inventions, discoveries, concepts, scientific methods, and other technology and processes, including without limitation AMRI’s THC manufacturing process, owned by AMRI and existing as of the date of this Agreement and used in the course of performing this project. AMRI Proprietary Technology shall remain the exclusive property of AMRI. Upon 30 day written notice, Nemus may

terminate AMRI’s obligations under this proposal [***] prior to performance of any test interval and would only be responsible [***].

Please appreciate that upon receipt of authorization to proceed with the cGMP production [***], AMRI schedules its equipment and personnel and orders materials in anticipation of commencing this work. AMRI will inform Nemus of the scheduled production date as soon as is practical following receipt of Nemus’s acceptance of this proposal. Nemus may at any time cancel or delay a project prior to the scheduled start date by providing AMRI with written notice. Upon receipt of such cancellation notice, AMRI shall cease all work at a logical and mutually agreed to stopping point and limit further expenses associated with such production, including cancelling all outstanding subcontracts associated with the execution or other preparations for the project. Subject to the cancellation, Nemus shall reimburse AMRI for costs incurred prior to and including the date of cancellation plus any reasonable and foreseeable costs associated with stopping work on the project, including the costs associated with idle production facility capacity as described herein, at a rate of [***]. In the event of a delay imposed by Nemus [***] of the scheduled production, [***]. AMRI reserves the right to implement the aforementioned charges to cover the loss of revenue incurred as a result of reserving production facilities for the exclusive use of Nemus. [***].

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

Dr. [***]

Nemus Bioscience, Inc. February 3, 2016

Page 3 of 13

 

We appreciate the opportunity to do business with Nemus and request that you consider this proposal as expeditiously as possible. We will schedule this project promptly upon receipt of

 

your written authorization. Please note that we are constantly receiving requests for new projects.  Company policy dictates that we can commit resources and guarantee a start date only after receipt of an order. All work specified herein will be performed in accordance with our Terms and Conditions attached hereto. Any terms and conditions contained in a Nemus purchase order or other document which are additional to or inconsistent with this Agreement shall be void, unless specifically agreed to by AMRI in writing, signed by AMRI’s duly authorized representative.

Payment Schedule

	
Description

	
Payment

	
[***]

	
[***]

AMRI will invoice Nemus for Parts II and IV, with title to and risk of loss of the material transferring to Nemus as set forth in Section 3 of the Terms and Conditions. Nemus shall pay invoices [***]. All material shall be delivered [***].

Nemus shall be responsible for [***]. For clarity, AMRI will invoice Nemus for [***].

 

 

 

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

Dr. [***]

Nemus Bioscience, Inc. February 3, 2016

Page 4 of 13

This proposal is valid for [***] from the date of issue. In the event that Nemus indicates its intent to accept any portion of this proposal following the [***] or in the event that Nemus accepts the work contemplated herein to commence more than [***] from the date of this proposal, AMRI reserves the option to submit a revised proposal to reflect any change in costs since the date of the original proposal. This proposal is [***].

Please feel free to contact me if there is any further information that AMRI can provide about any aspect of this proposal. I look forward to hearing from you.

	 Sincerely,	 Agreed and Understood:	 
	 	 	 
	 [***] [***]	  [***]	 
	 E-mail: [***]	 Nemus Bioscience, Inc.	 
	 AMRI Proposal #151116-154113v3	
 Feb, 5, 2016

 Date

	 

 

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

Dr. [***]

Nemus Bioscience, Inc. February 3, 2016

Page 5 of 13

Proposal for the cGMP Manufacture of [***]

For Nemus Bioscience, Inc.

AMRI Proposal #151116-154113v3

This document specifies the services to be provided by AMRI and the costs related to the process development, a non-binding estimate for the non-GMP production of [***], the analytical method development and qualification, a non- binding estimate for the cGMP production of [***], and a stability study.

AMRI refers to current Good Manufacturing Practices (“cGMP”) as specified in the International Conference on Harmonization (“ICH”) guide Q7A “ICH Good Manufacturing Practice Guide for Active Pharmaceutical Ingredients” (“API”), as applied to the manufacture, testing, and quality control of APIs. For the purposes of this proposal, AMRI has assumed that the final API

material is intended for Phase I Clinical Trials.

For the purposes of this proposal, the cGMP starting material for this work has been defined as [***], and [***], as outlined in Attachment I. Please appreciate that the estimates below account for [***].

I.            Process Development

Prior to initiating the cGMP production, AMRI shall evaluate and develop the current process provided by Nemus (see Attachment I) to ensure reproducibility, quality, and safety on scale. As part of this work, AMRI shall pursue the following objectives:

 

		1)	[***].

 

		2)	[***].

		3)	[***].

		4)	[***].

		5)	[***].

		6)	[***].

 

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

Dr. [***]

Nemus Bioscience, Inc. February 3, 2016

Page 6 of 13

		7)	[***].

		8)	[***]. As part of this effort, AMRI shall conduct the following work for each stage:

 

[***]

 

 

 

 

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

Dr. [***]

Nemus Bioscience, Inc. February 3, 2016

Page 7 of 13

[***]

Upon successful completion of the process development activities, AMRI shall [***].

We recommend utilizing our Full-Time Equivalent (“FTE”) program since this approach allows the client the flexibility of changing scope and direction during the course of the project. AMRI will dedicate [***] for a period of [***]. Under the FTE program, [***] dedicated to your project and will provide Nemus with regular updates on its progress. The FTE rate for this project is [***]. For clarity, the total labor fee for this work is estimated to be [***]. Reimbursable expenses for [***].

Communication during this work will be through regular written updates and teleconferences to keep Nemus updated on the progress of the development effort. Deliverables shall include these updates, a non-GMP demonstration batch, and a final report describing the resulting process. In addition, any intermediates that are generated during this work may be provided to Nemus upon request.

Please appreciate that depending on the ongoing observations made and results obtained in this program, it is possible that the program may be completed in more or less time than is estimated herein. Should this work require more time than is estimated herein, Nemus will be notified and will have the option of extending the project. Nemus will be invoiced in arrears for the monthly FTE allocation and materials required to complete the work contemplated hereunder.

II.            Non-Binding Estimate for the Non-GMP Manufacture of [***]

Please appreciate that until such time that a final process is developed, AMRI is providing Nemus with a non-binding estimate for the non-GMP manufacture of [***]. For the purposes of this proposal, AMRI has assumed that [***].

 

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

Dr. [***]

Nemus Bioscience, Inc. February 3, 2016

Page 8 of 13

Please appreciate that upon completion of the process development activities and improvement

of the process outlined in [***], AMRI shall provide a binding estimate for this work [***]. The non-binding estimated fees and anticipated timeframes are outlined in the table below.

	
Description

	
Fixed Fee*

	
Anticipated Timeframe**

	
[***]

	
  [***]

	
  [***]

*[***].

**[***].

The non-GMP work shall be documented in batch records, completed copies of which shall be provided to Nemus upon conclusion of the work. The original batch records shall be maintained at AMRI. A Certificate of Analysis shall be prepared for [***], summarizing the results of the following analyses. Additionally, [***] shall be furnished to Nemus as deliverables.

	
Analyses

	
[***]

III.            Analytical Method Development and Qualification

AMRI shall develop and qualify the analytical methods which are required to support the cGMP

manufacture of [***]. This work shall include the following:

[***]

As part of this effort, a portion of the demonstration batch shall be retained at AMRI and set up as a reference standard. The testing of the demonstration batch shall include the following analyses:

	
Analyses

	
[***]

For the purposes of this proposal, this estimate was prepared under the following assumptions:

[***]

AMRI will conduct this analytical method development and qualification work for a fixed fee of $142,900, [***].

We anticipate that [***] will be required to complete this work, following receipt of all materials and availability of resources. Deliverables shall consist of [***].

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

Dr. [***]

Nemus Bioscience, Inc. February 3, 2016

Page 9 of 13

 

Please appreciate that should any additional analytical work other than what is estimated herein be required, Nemus would be contacted and updated on this information. At that point, Nemus, at its sole discretion, will have the option to extend this portion of the program.

IV.     Non-Binding Estimate for the cGMP Manufacture [***]

Please appreciate that until such time that a final process is developed, AMRI is providing Nemus with a non-binding estimate for the cGMP manufacture of [***]. For the purposes of this proposal, AMRI has assumed that [***].

Please appreciate that upon completion of the process development activities and improvement

of the process outlined in Part I, AMRI shall provide a binding estimate for this work [***]. The non-binding estimated fees and anticipated timeframes are outlined in the table below.

	
Description

	
Fixed Fee*

	
Anticipated Timeframe**

	
[***]

	
  [***]

	
  [***]

*[***].

**[***].

The cGMP work shall be documented in batch records, completed copies of which shall be provided to Nemus upon conclusion of the work.  The original batch records shall be maintained at [***]. A Certificate of Analysis shall be prepared for [***], summarizing the results of the following analyses:

	
Analyses

	
[***]

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

Dr. [***]

Nemus Bioscience, Inc. February 3, 2016

Page 10 of 13

Analytical and quality assurance support to the cGMP campaign shall include, but not necessarily be limited to, the release of raw materials,[***]; cGMP support; cleaning validation and verification; final API release; and preparation of an appropriate Certificate of Analysis.

V.            Stability Study

A study initiation fee defined below shall be charged upon [***].

Samples will be stored and tested the following intervals:

[***]

Testing at each interval shall in include the following:

[***]

It is assumed, for the purposes of this proposal that the stability study can be initiated [***], allowing the release data to serve as the initial timepoint. In the case that this is not possible, [***]. Nemus shall authorize the use of [***] for use in the stability program. Testing will be conducted at the prescribed intervals for the fees summarized in the table below:

	
Test Interval

	
Fixed Fee

	
[***]

	
[***]

	
Total:

	
[***]

 

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

Dr. [***]

Nemus Bioscience, Inc. February 3, 2016

Page 11 of 13

 

An additional fee of [***] may be charged in the event that additional testing is requested by Nemus or additional testing required by [***].

The standard stability report, included in the above fixed fee, consists of [***]. If a final, written report summarizing the study is requested,[***].

AMRI Proposal #151116-154113v3

 

 

 

 

 

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

Dr. [***]

Nemus Bioscience, Inc. February 3, 2016

Page 12 of 13

Attachment 1

[***]

 

 

 

 

 

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

 

Exhibit A

TERMS & CONDITIONS Albany Molecular Research, Inc.

1.       AGREEMENT AND ACCEPTANCE: The entire agreement (the “Agreement”) between Albany Molecular Research, Inc. (“AMRI”), and the Customer consists of: (i) AMRI’s proposal for the products, materials, services, goods (collectively “Proposal”), and (ii) these Terms and Conditions. For purposes of this Agreement, any documentation, report, product, material or good provided to Customer in the performance of Services shall be referred to as “Deliverables” or “Deliverable”  and AMRI’s performance of any services, [***] shall be generally referred to as “Services”.  The Agreement shall become binding when accepted by Customer either by acknowledgment or at the time performance of the services begins by mutual agreement. Any terms and conditions proposed by the Customer which are additional to or inconsistent with the Terms and Conditions contained in the Agreement shall be void.  In the event a Master Services Agreement (the “MSA”) is in place between the parties, the MSA will govern over any Terms and Conditions. AMRI represents and warrants that it is not and shall not be debarred, and that each employee or independent contractor it engages in connection with activities under this Agreement is not and shall not be debarred, under applicable FDA or other law.

2.       DELIVERY SCHEDULE; QUANTITIES; DELAYS IN DELIVERY:  All deliveries shall be made in accordance with any timelines set out in the Proposal.  [***]. In the event Customer requests that any given shipment be delayed beyond the intended shipment date, AMRI will store the material [***]; in such event, [***].

3.       TRANSPORTATION, PACKAGING AND SHIPPING: Unless otherwise specified in the Proposal, Deliverables shall be delivered [***]. Title and risk of loss of any Deliverable shall [***]. AMRI herein represents that if mutually agreed in a Proposal, the Deliverables ordered by the Customer are packed in containers and bearing labels, if necessary, which conform to the regulations of the Department of Transportation in effect at the time of shipment.  All Deliverables shall be prepared for shipment and packed to prevent damage or deterioration, secure lowest transportation rates, and comply with carrier tariffs.

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

 

4.       CONFIDENTIAL INFORMATION: The exchange of Confidential Information shall be governed by the Confidentiality Agreement (the “CDA”) in place between the parties. If there is no CDA in place, then the following applies:  The Parties anticipate that they will exchange proprietary and confidential information during the term of this Agreement. The Parties shall treat all information (whether written or oral) exchanged hereunder as confidential, and each Party shall use the same degree of care used to protect and maintain its own confidential or proprietary information from unauthorized use or disclosure. Neither Party shall use the other Party’s proprietary or confidential information for any purpose other than in performance of this Agreement. Neither Party shall disclose the other Party’s confidential or proprietary information to any third party without prior written permission from the disclosing Party.  The foregoing restrictions shall not apply to information that was in the receiving Party’s possession without confidentiality restrictions prior to receipt from the other Party, or that lawfully becomes publicly available through no fault of the receiving Party. The receiving Party may disclose the other Party’s confidential or proprietary information to its employees and officers requiring access thereto solely as necessary to perform the Services, provided that each such employee and officer is bound by a written agreement to maintain the confidential or proprietary information in strict confidence and to use such information solely to perform the Services. Each Party may disclose information received from the other Party as required by laws, rules or regulations or rules of a securities exchange provided that the Party required to make such disclosure gives notice to the disclosing Party prior to making such disclosure, and uses all commercially reasonable efforts to secure confidential treatment of such information where reasonably available.

5.       PAYMENT: Unless otherwise specified in the Proposal, AMRI will invoice Customer [***], with payment due [***].

6.       WARRANTIES: CUSTOMER WARRANTS THAT TO ITS KNOWLEDGE THE USE OF ANY PRODUCT, MATERIALS, PROCESSES, AND THE LIKE FURNISHED TO AMRI UNDER THE AGREEMENT FOR THE PERFORMANCE OF SERVICES (“CUSTOMER MATERIALS”) WILL NOT INFRINGE ON ANY EXISTING PATENT, TRADEMARK OR COPYRIGHT. UNLESS OTHERWISE STATED HEREIN, AMRI DOES NOT MAKE ANY WARRANTY, EXPRESS OR IMPLIED BY STATUTE OR IN WRITING, REGARDING THE SERVICES OR THE DELIVERABLES, INCLUDING WITHOUT LIMITATION ANY WARRANTY REGARDING THEIR FITNESS FOR PURPOSE, THEIR QUALITY, THEIR MERCHANTABILITY OR THEIR NON-INFRINGEMENT OF ANY INTELLECTUAL PROPERTY RIGHTS. ANY OTHER REPRESENTATIONS OR WARRANTIES MADE BY ANY PERSON OR ENTITY, INCLUDING EMPLOYEES OR REPRESENTATIVES OF A PARTY HERETO, THAT ARE INCONSISTENT HEREWITH, SHALL BE DISREGARDED AND SHALL NOT BE BINDING ON SUCH PARTY.

7.       LIMITATION OF LIABILITY:  IN NO EVENT SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY OR ITS AFFILIATES FOR LOST PROFITS OR ANY SPECIAL, CONSEQUENTIAL, INCIDENTAL, PUNITIVE OR INDIRECT DAMAGES ARISING FROM ANY BREACH OF THIS AGREEMENT OR IN CONNECTION WITH THIS AGREEMENT OR  ANY  PROPOSAL,  INCLUDING  WITHOUT  LIMITATION ANY BREACH OF A WARRANTY CONTAINED HEREIN OR [***]. LIMITATIONS OF LIABILITY CONTAINED IN THIS SECTION SHALL NOT BE DEEMED TO LIMIT EITHER PARTY’S INDEMNITY OR INSURANCE OBLIGATIONS UNDER THIS AGREEMENT.

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

8.       CHANGES:   Customer reserves the  right  to  request changes to  the  Services being performed pursuant to this Agreement or a Proposal including, without limitation, changes in drawings, specifications and delivery (“Change Orders”).  AMRI may agree to comply with such Change Orders.  If such Change Orders result in an increase in AMRI’s cost or in the time for performance, an equitable adjustment in the price or time for performance shall be made in writing to Customer and a claim for additional compensation hereunder will be asserted in a timely manner.  Prior to AMRI’s acceptance or rejection of the Change Order, the parties shall discuss and agree in writing to any appropriate price and/or time adjustments.

9.       INSURANCE: Each Party shall procure and maintain at its own expense appropriate product and commercial liability insurance with respect to the conduct and performance of the Services under each Proposal and/or this Agreement and use or sale of the Deliverables, as each Party customarily maintains with respect to similar activities. Customer shall maintain insurance on all materials that it has or retains title to.

10.     FEDERAL, STATE AND LOCAL TAXES: Any taxes, duties or fees applicable to the sale, export or imports of Customer Materials or Deliverables or related to the performance of Services shall be borne by the Party on which such taxes are imposed under law.

11.     INDEMNIFICATION: Customer shall indemnify and hold AMRI, its Affiliates and their directors, officers, employees and agents (“AMRI Indemnitee”) harmless from and against any and all third party claims, damages, liabilities, losses, costs and expenses, including but not limited to attorneys’ fees (collectively, “Claims”) arising from or related to: (i) injury, damage or death in connection with Customer’s or a third party’s use or sale of the Deliverables or results of the Services, or Customer’s or a third party’s manufacture, use or sale of any product or service incorporating the Deliverables, including without limitation any Claims attributable to any product incorporating Deliverables (whether based on strict liability, inherent design defect, negligence, failure to warn, breach of contracts or any other theory of liability); (ii) the manufacture, use or sale of any Deliverable or Customer materials, or Customer product incorporating Deliverables, infringing a third party’s patent or other intellectual property rights (except to the extent covered by subsection (A) below); (iii) any gross negligence or willful misconduct of Customer or any of its directors, officers, employees, or agents (“Customer Indemnitee”); and (iv) Customer’s failure to comply with all applicable laws, statutes, rules, regulations and orders of governmental, public and quasi-public authorities; except to the extent that such Claim is caused by the gross negligence or willful misconduct of AMRI Indemnitees. AMRI shall indemnify and hold Customer Indemnitees harmless from and against any and all Claims to the extent arising from: (A) the manufacture, use or sale of any AMRI Proprietary Technology (as defined in the Proposal) infringing a third party’s patent or other intellectual property rights; (B) any gross negligence or willful misconduct of or breach of a representation or warranty by any AMRI Indemnitee in connection with the Agreement; and (C) AMRI’s failure to comply with all applicable laws, statutes, rules, regulations and orders of governmental, public and quasi-public authorities; except to the extent that such Claim is caused by the gross negligence or willful misconduct of or breach of a representation or warranty by Company Indemnitees.

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

12.     ASSIGNMENT:   Neither Party may assign or delegate any or all of its rights or obligations under this Agreement, or transfer this Agreement, without the prior written consent of the other party, except that either Party shall have the right to assign any of its rights, delegate any of its obligations, or transfer this Agreement without such consent (i) to an affiliate of such Party or (ii) as part of a merger or acquisition of such party or sale of all assets to which this Agreement relates. Any assignment by a Party shall bind its assignee to all provisions of this Agreement. Any assignment, delegation or transfer by either Party without the consent of the other Party shall be void and of no effect.

13.     TERMINATION FOR CONVENIENCE: Except as otherwise specified in the Proposal, Customer may, at any time upon 30 days’ written notice, terminate this Agreement in whole or in part regardless of whether there is a default under this Agreement. Such written notice shall state the extent and the effective date of termination.  Each Party shall take all necessary steps to mitigate any losses that might incur on account of such termination. Termination by Company under this Section shall be without prejudice to any claims Company may have against AMRI.

14.     TERMINATION FOR DEFAULT:  Each of the following events shall constitute a default by a Party for purposes of this Agreement (a) the insolvency of such Party, (b) any assignment for the benefit of creditors of such Party, (c) the voluntary or involuntary filing of a petition order or other decree in bankruptcy by or against such Party, (d) the commencement of any proceeding, under court supervision or otherwise, for liquidation of, reorganization of, or the composition, extension, arrangement or readjustment of the obligations of such Party, and (e) failure by such Party to comply with any of the provisions of the Agreement in any material respect, and (f) proof that any representations by such party were false when made. In the event of a default by Party which is not cured within thirty (30) days of receiving a notice of default, the other Party may terminate this Agreement in writing.

15.     EFFECT OF TERMINATION: Upon termination, Customer’s obligation to AMRI shall be set forth in a final invoice and may include [***].

16.     WAIVER: No delay or omission in exercising any right or remedy shall operate as a waiver thereof or of any other right or remedy, and no single or partial exercise thereof shall preclude any other or further exercise thereof or the exercise of any other right or remedy. The rights, powers, elections and remedies of the Parties hereunder are cumulative and in addition to those which the Parties have at law or in equity. A Party’s failure to object to any provision contained in any communication from the other Party shall not be deemed an acceptance of such provision or a waiver of any provision of this Agreement.

17.     COMPLIANCE WITH LAWS: Each Party shall, in the performance of the Agreement, comply with all applicable laws, statutes, rules, regulations and orders of governmental, public and quasi-public authorities.

18.     BRIBERY AND CORRUPT PRACTICES: AMRI is committed to complying with all applicable anti-corruption laws, regulations and policies worldwide.    AMRI expects its customers, suppliers and business partners to comply with all such laws that prohibit the making, offering or promise of any payment or anything of value, directly or indirectly, to a government official or a government agency (“Officials”), when the payment is intended to influence an act or decision or the retention of business. Accordingly, each Party represents, agrees and warrants that it shall comply with all applicable anti-corruption laws, rules and regulations, including but not limited to the United States Foreign Corrupt Practices Act and the UK Bribery Act, and that it shall not make any payment of money, gifts, services or anything of value either directly or indirectly, to an Official, when the payment is intended to influence an act or decision or the retention of business.

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.

19.     FORCE MAJEURE: Neither Party shall be liable for, or in connection with, any failure or delay in performance due [***] which prevents or hinders such party from performing the services as provided for under the Agreement.

20.     GOVERNING LAW; ARBITRATION:    This Agreement shall be governed by, interpreted and construed in accordance with the laws of the State of New York, without regard to the principles of conflicts of law. All disputes arising from or related to this Agreement may be submitted to arbitration in Albany, New York (or at a location agreed to by AMRI) under the rules then prevailing of the American Arbitration Association and judgment may be entered on any award in a court of competent jurisdiction.  The parties acknowledge and agree that the United Nations Convention on Contracts for the International Sale of Goods is specifically excluded from application to this Agreement.

 

 

 

 

 

 

 

 

 

 

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission. Confidential treatment has been requested with respect to the omitted portions.Exhibit 10.03

 

FEDERAL HOME LOAN BANK OF NEW YORK 2016 INCENTIVE COMPENSATION PLAN

 

I.                            OBJECTIVE

 

The objective of the Federal Home Loan Bank of New York’s (“Bank”) 2016 Incentive Compensation Plan (“Plan”) is to motivate employees to take actions that support the Bank’s strategies and lead to the attainment of the Bank’s business plan and fulfillment of its mission.

 

The Plan is intended to accomplish this objective by:

 

·                  Linking annual cash pay-out award opportunities to Bank performance measured by the Bank’s “Business Effectiveness”; “Community Investment Effectiveness” ; and, “Growth Effectiveness” goals as well as utilizing individual, department and group performance measures for certain employees where appropriate and applicable;

·                  Establishing the goal-setting process as an effective reward system so that employee monetary interests are related to and dependent upon Bank performance; and

·                  Retaining top performing employees by affording them the opportunity to share in the Bank’s enhanced performance.

 

II.                       DEFINITIONS

 

A.            Bank: The Federal Home Loan Bank of New York, its successors and assigns.

 

B.            Board: The Board of Directors of the Federal Home Loan Bank of New York.

 

C.            Committee: The Compensation and Human Resources Committee of the Board.

 

D.            Fiscal Year: The 12-month period used as the annual accounting period by the Bank.

 

E.             Manager: The person to whom the Participant reports directly.

 

F.               Participant: An employee of the Bank as defined by the terms of the Financial Institutions Retirement Fund who is exempt from the application of the overtime provisions of the Fair Labor Standards Act and who is also selected by the President to participate in the Plan.

 

G.            Plan: This Incentive Compensation Plan, as may be amended or supplemented from time to time.

 

H.           Plan Year: 2016

 

I.                President: The Chief Executive Officer of the Bank, regardless of title, or his designee.

 

1

 

III.                  ADMINISTRATION

 

A.            The Plan shall become effective upon fulfillment of the conditions included in the resolution pertaining to the Plan adopted by the Committee on January 27, 2016. Once such conditions are fulfilled, the terms of the Plan shall become effective for the Plan Year beginning January 1, 2016.

 

B.            The Plan shall be administered by the President, subject to any requirements for review and approval by the Committee that the Committee may establish. The Committee shall keep the Board apprised of any amendments to the Plan.  The Director of Human Resources shall be the President’s designee until there is a written communication by the President naming other(s) to fulfill that duty.  In all areas not specifically reserved by the Committee for its review and approval, decisions of the President or his designee concerning the Plan shall be binding on the Bank and on all Participants.

 

C.            While the President has the full power and authority to interpret and administer the Plan, he will also have the following specific rights and duties:

 

1.             To adopt, amend and rescind administrative guidelines, rules and regulations pertaining to the Plan.

 

2.             To accept, modify or reject recommendations of the Managers to set final awards.

 

3.             To interpret and rule on any questions pertaining to any provisions of the Plan.

 

4.             To retain all such other powers as may be necessary to discharge the duties and responsibilities herein. Notwithstanding the foregoing, matters specifically affecting the President shall be handled by the Committee.

 

D.            The President will be responsible for ensuring effective communication of Plan provisions each year.  Each Participant will be given a copy of the Plan document and of any schedule deemed necessary by the President.  Material modifications or changes to the Plan will be documented and distributed to Participants as soon as practicable.

 

E.             Nothing contained in this Plan shall be construed as a contract of employment between the Bank and a Participant, or as a right of a Participant to be continued in the employment of the Bank, or as a limitation of the right of the Bank to discharge a Participant with or without cause.

 

IV.                   ELIGIBILITY

 

A.            Employees in positions determined to have a measurable impact on Bank results and for whom incentive participation is consistent with competitive practice may be eligible for participation in the Plan.

 

B.            The President will select annually, for approval by the Committee, those positions which will be eligible for awards granted under the terms of the Plan.  Eligibility may vary from year to year.

 

C.            Incentive compensation opportunity by rank and position is listed in Schedule A, incorporated by reference, which may be updated annually or more frequently, as appropriate.

 

D.            New employees deemed eligible for Plan participation will be considered eligible immediately upon date of hire.

 

V.                        INDIVIDUAL AWARD OPPORTUNITIES

 

A.            The President shall recommend to the Committee for its approval the award levels which shall be used to calculate awards earned by Plan Participants.

 

B.            Award levels shall be expressed as a percent of the base salary of each Participant for that Plan Year.

 

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C.            Each position shall have an assigned threshold, target and maximum award opportunity level. The range of award opportunities for each Plan Participant is included in Schedule A, which is incorporated by reference.  This Schedule A may be amended or otherwise modified from year to year by the Committee.

 

VI.                   OBJECTIVE SETTING

 

The President shall from time to time recommend to the Committee Bankwide performance goals that incentive payments to Participants shall be based upon, either in their entirety or selectively.  Individual and/or group performance measures and goals may be developed by Participants in collaboration with their Managers. The Bankwide performance goals will specify target performance levels as well as the achievement levels required to receive threshold and maximum incentive award amounts. Target performance goal(s) reflect achievement of the Bank’s budgeted performance. Maximum performance goal(s) shall be established as goal(s) representing a “reach” for the Bank and/or the group or individual as applicable. The Committee shall review and have final approval over the Bankwide performance measures and goals for all Participants, including the President.  Individual and/or group performance measures and goals for Participants other than the President will be reviewed and approved by the participant’s and/or group’s manager.  Changing the measures of Bankwide performance or changing the achievement levels of Bankwide performance will require approval of the Committee.

 

VII.              OBJECTIVE WEIGHTING

 

Actual incentive awards under the Plan will be based on (i) Bankwide performance results, and (ii) individual and/or group performance results, if applicable or appropriate. The relative weighting of Bank performance may vary for any group of Participants or individual Participant.

 

VIII.         PERFORMANCE MEASUREMENT

 

A.            Performance against goals will be measured as soon as practicable following the close of the Plan Year.

 

B.            Group and/or individual performance, where applicable, will be measured by each Participant’s Manager.

 

IX.                  AWARD DETERMINATION

 

A.            Aggregate performance of Bankwide goals, individual and/or group goals, where applicable, will be used to determine the Participants’ awards.  There will be no payout to Participants for Bankwide goals if results on all Bankwide goals fall below the threshold level. Should the Bank not meet all of its Bankwide goals, Participants who have attained at least an overall performance rating of 3.0 will be paid an incentive award based on their individual performance component.

 

B.            A Participant’s overall performance as rated in his/her last performance evaluation must be rated at least a 3.0 in order to receive an incentive payment. However, regardless of his or her overall rating, a Participant with a Performance Improvement Plan or written performance warning in his or her employment file who does not also have corresponding documentation from his or her manager in his/her employment file evidencing acceptable improvement in the Participant’s performance prior to the payment of the award shall not receive any incentive payment.

 

C.            Participants who are on official leaves of absence, paid or unpaid, and who have an 1) executed 90-day follow-up performance evaluation (for newly- hired Participants) or 2) annual performance evaluation for the Plan Year shall be eligible to receive incentive

 

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awards for the Plan Year, payment of which will be made when the Participant returns from the paid or unpaid leave of absence if that occurs later than the payment of awards to other Participants.

 

D.            Recommendations will be made to the Committee regarding the actual Bankwide performance and the associated level of payments as soon as practicable following the conclusion of the Plan Year. Such recommendations shall be based on achieved levels of performance, measured against the performance objectives adopted for each portion of the award.

 

E.             Plan Participants, including the President, will receive a cash payment of the award as soon as practicable after final approval by the Committee, in accordance with Paragraph N below.

 

F.              Awards earned may vary from the target award defined for each Plan Participant according to performance achieved by the Bank, and where applicable by the group or individual.

 

G.            Payments may vary from the assigned threshold, target and maximum award opportunity level as indicated in Schedule A if the Committee determines at the end of the Plan year that an adjustment to the schedule would better serve the purposes of the Plan.

 

H.           Individuals who are hired during the Plan Year, but in no event after October 31 of that year, to fill eligible positions will receive prorated incentive payments based on length of time worked. To receive such payments, the newly hired employee must have an executed 90-day follow-up performance evaluation and have received at least a “Meets Requirements” rating. The final incentive payment will be calculated on a calendar day basis.

 

I.                If a Participant’s rank or assignment from one tier to another as indicated in Schedule A is changed, the incentive payment may be determined on a pro rata basis according to that portion of the Plan Year worked in each eligible position.

 

J.                If a Participant is promoted and their incentive compensation opportunity, as indicated in Schedule A, does not change, the incentive payment may be determined on a pro rata basis according to that portion of the Plan Year Participant worked in each eligible position.

 

K.            Incentive payments for Participants who are non-officers shall be calculated using the base salary as of the end of the Plan year without regard to prorating.

 

L.             If a Participant other than the President dies, the payment may be awarded based upon the judgment of the Committee. The final payment may be made after approval by the Committee following the conclusion of the Plan Year. If the President dies, the payment may be awarded based upon the judgment of the Board. The final payment may be made after approval by the Board following the conclusion of the Plan Year.

 

M.         If, prior to the payment of an award, (i) the employment of a Participant is terminated by the Bank or (ii) the Participant leaves the Bank voluntarily, no incentive award will be made or payable under this Plan, except in the discretion of the Committee (or in the case of the President, the Board).

 

N.            All incentive awards under this Plan shall be paid to Participants on or before March 13, 2017; provided that, in the event the Bank shall be prevented from calculating and paying such incentive awards by March 13, 2017 by any event, including specifically, but not limited to, (i) its unforeseeable failure to receive any necessary approvals of its financial statements of the Bank for the calendar year 2016 from its regulators or outside accountants in sufficient time in advance of March 13, 2017, (ii)  the unforeseeable temporary absence of Bank employees necessary to calculate such incentive awards by such date, or (iii) any other event which the Bank may reasonably deem, in good faith, to constitute administrative impracticability of the Bank to calculate and pay such incentive awards by such date, the failure of the Bank to pay 

 

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such incentive awards to Participants by March 13, 2017 shall be deemed to be due to administrative impracticability, within  the meaning of § 1.409A-1(b)(4)(ii) of the Regulations under § 409A of the Internal Revenue Code of 1986, as amended (the “Code”), should such provision of the Code be deemed applicable to the Plan notwithstanding the provisions of Section X of this Plan, in which event, or in any other event which may meet the requirements of such provision of such Regulations, the Bank shall pay such incentive awards as soon as the calculation and payment thereof shall be practicable, both administratively and otherwise.

 

O.            Notwithstanding anything to the contrary contained above, payments will be made to certain Participants who are members of the Bank’s Management Committee on a deferred basis in accordance with the provisions of Schedule B attached hereto.

 

X.  BINDING EFFECT AND AMENDMENT AND TERMINATION OF PLAN

 

No Participant shall have any legally binding right, whether by reason of the  performance of services or otherwise, to receive any incentive awards or payments under this Plan and nothing in this Plan is intended, nor shall it be deemed, to confer upon any Participant any such legally binding right, the Bank reserving and retaining the right, by its unilateral action at any time and for any reason, to reduce or eliminate any incentive awards or payments and to amend, modify or terminate this Plan.  All actions by the Bank pursuant to this Section X shall be made in writing and shall be effective when approved by the Committee or, in the case of actions affecting the President, when approved by the Board.

 

XI.  CLAWBACK PROVISION

 

If, within 3 years after an incentive has been paid or calculated as owed to a Participant who is a member of the Bank’s Management Committee, it is discovered that such amount was based on the achievement of financial or operational goals within this Plan that subsequently are deemed by the Bank to be inaccurate, misstated or misleading, the Board shall review such incentive amounts paid or owed. Inaccurate, misstated and/or misleading achievement of financial or operational goals shall include, but not be limited to, overstatements of revenue, income, capital, return measures and/or understatements of credit risk, market risk, operational risk or expenses.

 

If the Board determines that an incentive amount paid or considered owed to the Participant (the “Awarded Amount”) would have been a lower amount when calculated barring the inaccurate, misstated and/or misleading achievement of financial or operational goals (the “Adjusted Amount”), the Board shall, except as provided below, seek to recover to the fullest extent possible the difference between the Awarded Amount and the Adjusted Amount (the “Undue Incentive Amount”).

 

The Board may decide to not seek recovery of the Undue Incentive Amount if the Board determines that to do so would be unreasonable or contrary to the interests of the Bank.  In making such determination, the Board may take into account such considerations as it deems appropriate including, but not limited to, (a) whether the Undue Incentive Amount is immaterial in impact to the Bank; (b) whether the Participant engaged in any intentional or unlawful misconduct that contributed to the inaccurate, misstated and/or misleading information; (c) whether the change in the applicable achievement level was a result of 

 

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circumstances beyond the control of management; (d) the likelihood of success to recover the claimed Undue Incentive Amount under governing law versus the cost and effort involved;  and (e) whether seeking recovery could prejudice the interests of the Bank. The decision by the Board to seek recovery of an Undue Incentive Amount need not be uniform amongst Participants. Authority of the Board under this Article XI may be delegated to the Committee, but may not be delegated to the President.

 

If the Board determines to seek recovery of any or all of the Undue Incentive Amount (the “Recovery Amount”) pursuant to this Article XI, it will make a written demand from the Participant for the repayment of the Recovery Amount. Subject to the provisions of Schedule B regarding the forfeiture of unpaid amounts, if the Participant does not within a reasonable period, after receiving the written demand, provide repayment of the Recovery Amount, and the Board determines that he or she is unlikely to do so, the Board may seek a court order against the Participant for repayment of the Recovery Amount.

 

XII.  OTHER PROVISIONS

 

The provisions of the Plan shall be governed by the laws of the State of New York.

 

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Schedule A

 

2016 Incentive Compensation Opportunity Table

 

	
Ranking
    	
 
    	
Bank
   Performance/Individual
   Performance
    	
 
    	
Incentive Compensation
   Opportunity
    
	
President
    	
 
    	
90%/10%
    	
 
    	
50% (Threshold)
   75% (Target)
   100% (Maximum)
    
	
Management Committee   Member
    	
 
    	
90%/10%
    	
 
    	
30% (Threshold)
   50% (Target)
   75% (Maximum)
    
	
Sales/Calling Officer   Responsibilities
    	
 
    	
35%/65%
    	
 
    	
15% (Threshold)
   32.5% (Target)
   55% (Maximum)
    
	
Key Vice President
    	
 
    	
70%/30%
    	
 
    	
15% (Threshold)
    30% (Target)
   50% (Maximum)
    
	
Other Vice President
   and Director of Compliance
    	
 
    	
60%/40%
    	
 
    	
12% (Threshold)
   25% (Target)
   40% (Maximum)
    
	
Assistant Vice   President
    	
 
    	
40%/60%
    	
 
    	
10% (Threshold)
   17% (Target)
   30% (Maximum)
    
	
First Level Officer
    	
 
    	
40%/60%
    	
 
    	
7% (Threshold)
   12% (Target)
   20% (Maximum)
    
	
Exempt
    	
 
    	
25%/75%
    	
 
    	
3.5% (Threshold)
   7% (Target)
   10% (Maximum)
    

 

 

SCHEDULE B TO FEDERAL HOME LOAN BANK OF NEW YORK 2016 INCENTIVE COMPENSATION PLAN

 

DEFERRED INCENTIVE COMPENSATION PLAN PROVISIONS APPLICABLE TO THE MEMBERS OF THE BANK’S MANAGEMENT COMMITTEE

 

Definitions

 

The total amount of the incentive award (if any) under the Plan communicated to Management Committee Participants shall be referred to in this Schedule B as the “Total Communicated Award”.

 

The Total Communicated Award, if any, will be divided such that: 1) 50 percent of the Total Communicated Award shall be referred to as the “Current Communicated Incentive Award” and 2) the remaining 50 percent of the Total Communicated Award shall be referred to as the “Deferred Incentive Award.”

 

Payment Schedule

 

The following illustrates how the Current Communicated Incentive Award and Deferred Incentive Award will be paid:

 

	
Current Communicated   Incentive Award
    	
 
    	
50% of the Total Communicated Award
    	
 
    	
2017*
    
	
Deferred Incentive Award installment
    	
 
    	
Up to 33 1/3% of the Deferred Incentive Award
    	
 
    	
2018**
    
	
Deferred Incentive Award installment
    	
 
    	
Up to 33 1/3% of the Deferred Incentive Award
    	
 
    	
2019**
    
	
Deferred Incentive Award installment
    	
 
    	
Up to 33 1/3% of the Deferred Incentive Award
    	
 
    	
2020**
    

 

*Payment shall be made on or before March 13, 2017.

**Payment shall be made within the first two and a half weeks of March in the year indicated.

 

The Current Communicated Incentive Award at maximum shall not exceed 100 percent of the participant’s base salary.

 

Payments of Deferred Incentive Awards In The Event of a Change in Control

 

If prior to the payout of all Deferred Incentive Award payments a Change in Control event occurs (as defined below) then, in such case, the Deferred Incentive Awards shall be inapplicable and all unpaid Deferred Incentive Awards: (i) shall vest 30 days after the Federal Housing Finance Agency (“Finance Agency”) issues its written approval of such a transaction and (ii) shall be paid to the participants 30 days after the closing of the transaction.

 

For purposes of this section, “Change in Control” shall mean a “change in control event” as defined in IRS regulations pertaining to Code Section 409A which involves:  (i) the merger, 

 

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reorganization, or consolidation of the Bank with or into another Federal Home Loan Bank or other entity, (ii) the sale or transfer of all or substantially all of the business or assets of the Bank to another Federal Home Loan Bank or other entity, (iii) the purchase by the Bank or transfer to the Bank of all or substantially all of the business or assets of another Federal Home Loan Bank, (iv) a change in the composition of the Board of Directors, as a result of one or a series of related transactions, that causes the number of directors of the Bank elected by members of the Bank located in New Jersey, New York, Puerto Rico and the U.S. Virgin Islands to cease to constitute a majority of the directors of the Bank that are elected by members of the Bank (excluding, for purposes of this clause (iv), non-member independent directors), or (v) the liquidation of the Bank, provided that the term “reorganization” contained in this definition shall not include any reorganization that is mandated by federal statute, rule, regulation, or directive, including 12 U.S.C. Section 1421, et seq., as amended, and 12 U.S.C. Section 4501 et seq., as amended, and which the Director of the Finance Agency (or successor agency) has determined should not be a basis for making payment under this Plan, by reason of the capital condition of the Bank or because of unsafe or unsound acts, practices, or condition ascertained in the course of the Agency’s supervision of the Bank or because any of the conditions identified in 12 U.S.C. Section 4617(a)(3) are met with respect to the Bank (which conditions do not result solely from the mandated reorganization itself, or from action that the Agency has required the Bank to take under 12 U.S. C. Section 1431(d)).

 

Payments of Deferred Incentive Awards in the Event Employment Ends After The Current Communicated Incentive Award Is Paid

 

A. Retirement or Involuntary Termination of Employment Other Than For Cause

 

Participants who terminate employment due to retirement(1) or involuntary termination(2) (other than for cause(3)) after the Current Communicated Incentive Award payout date but before completion of the payment of all corresponding Deferred Incentive Award installments (as set forth above) shall receive such Deferred Incentive Award installment payments at the same time as such payments are made to Plan participants who are current Bank employees.

 

B. Resignation from Employment or Involuntary Termination of Employment For Cause

 

(1)  “Retirement” for purposes of this Plan is defined as any individual who retires as an Employee in accordance with the rules of the Bank’s Retirement Plan.

(2)  “Involuntary termination” shall, in all events, result in a “separation from service” as defined in the IRS regulations pertaining to Code Section 409A and (i) exclude termination for cause and (ii) include a resignation for “good reason” as defined in the “safe harbor” contained in such regulations.

(3)  For purposes of the Plan, “cause” means: (1) continued failure of the Participant to perform his or her duties with the Bank (other than any such failure resulting from disability), after a warning approved by the Director of Human Resources has been delivered to the Participant which specifically identifies the manner in which the Participant has not performed his or her duties; or (2) removal of the Participant by or at the direction of the Federal Housing Finance Agency pursuant to federal laws, rules, and regulations, including 12 U.S.C. §4501 et. seq. as amended or by any successor agency to the Federal Housing Finance Agency pursuant to a similar statute.

 

2

 

Participants who otherwise resign employment before the completion of the payment of all corresponding Deferred Incentive Award installments shall not receive payment of such installments.  Any Participant that is terminated by the Bank for cause (as defined in this Plan) prior to receiving payment of all corresponding Deferred Incentive Award installments shall not receive payment of any remaining unpaid Deferred Incentive Award installments.

 

C. Death or Disability

 

In the case of a Participant whose employment terminates due to death or disability before completion of the payment of all corresponding Deferred Incentive Award installments, such installments shall promptly vest following the death or disability and the remaining installments shall be paid by the Bank within 90 days of the date of death or determination of disability.

 

D. Payments of Deferred Incentive Awards

 

Deferred Incentive Awards will be paid if the Bank’s market value of equity to par value of capital stock ratio is equal to, or greater than 100%.

 

To compensate employees for the lost time value of money, the Bank will pay an interest rate on the deferred amount equal to the Bank’s return on equity over the deferral period, subject to a floor of zero.

 

An employee who terminates employment with the Bank other than for “good reason” or who is terminated by the Bank for “cause” (each as defined in the 2016 Plan ) will forfeit any portion of the Deferred Incentive Award that has not yet been paid upon such termination. In addition, the Deferred Incentive Award will be paid in full in connection with a “change in control” (as defined in the 2016 Plan).

 

E. Recovery of Unpaid Amounts.

 

To the extent that all or a portion of a Total Communicated Award is determined by the Board to be part (or all) of a Recovery Amount (as defined in Article XI of the Plan), the Recovery Amount shall be applied to the Current Communicated Incentive Award and Deferred Incentive Award installments as follows:

 

a.              If the Recovery Amount is determined prior to the Current Communicated Incentive Award payout date, 50% of the Recovery Amount shall be applied to the reduce the amount of the Current Communicated Incentive Award and the remaining 50% of the Recovery Amount shall be divided and applied equally to reduce the amount of each Deferred Incentive Award Installment.

 

b.              If the Recovery Amount is determined after the Current Communicated Incentive Amount payout date but before completion of the payment of all corresponding Deferred Incentive Award installments, the Recover Amount shall be divided and applied equally to reduce the amount of each of the remaining Deferred Incentive Award installments; provided, however, that if the aggregate amount of the Deferred Incentive Award installments is less than the Recovery Amount, the excess of the 

 

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Recovery Amount shall be settled in accordance with the last paragraph of Article XI of the Plan.

 

c.               If the Recovery Amount is determined after the Current Communicated Incentive Award payout date and after completion of all corresponding Deferred Incentive Award installments (including in the case of the Participant’s death or Disability), the Recovery Amount shall be settled in accordance with the last paragraph of Article XI of the Plan.

 

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