Document:

EX-10.14

 Exhibit 10.14 
 THIRD AMENDED AND RESTATED 
 UNSECURED REVOLVING 

DEMAND PROMISSORY NOTE 
  

			
	$40,000,000.00	  	December 31, 2012

 Section 1. Promise to Pay. For and in consideration of value
received, the undersigned, NL INDUSTRIES, INC., a corporation duly organized under the laws of the state of New Jersey (“Borrower”), promises to pay, in lawful money of the United States of America, to
the order of COMPX INTERNATIONAL INC., a corporation duly organized under the laws of the state of Delaware (“CompX”), or the holder hereof (as applicable, CompX or such holder shall be
referred to as “Noteholder”), the principal sum of FORTY MILLION and NO/100ths United States Dollars ($40,000,000.00) or such lesser amount as shall equal the unpaid principal amount of the loan made by Noteholder to Borrower
together with interest on the unpaid principal balance from time to time pursuant to the terms of this Third Amended and Restated Unsecured Revolving Demand Promissory Note, as it may be amended from time to time (this “Note”). This
Note shall be unsecured and will bear interest on the terms set forth in Section 7 below. Capitalized terms not otherwise defined shall have the meanings given to such terms in Section 17 of this Note. 

Section 2. Amendment and Restatement This Note renews, replaces, amends and restates in its entirety the
Second Amended and Restated Unsecured Revolving Demand Promissory Note dated December 13, 2011 in the original principal amount of $8,000,000.00 payable to the order of Noteholder and executed by Borrower (the “Second Amended
Note”). The Second Amended Note replaced, amended and restated the First Amended and Restated Unsecured Revolving Demand Promissory Note dated December 31, 2010 in the original principal amount of $8,000,000.00 payable to the order of
Noteholder and executed by Borrower (the “First Amended Note”). The First Amended Note replaced, amended and restated in its entirety the Unsecured Revolving Demand Promissory Note dated February 3, 2010 in the original
principal amount of $8,000,000.00 payable to the order of Noteholder and executed by Borrower (the “Original Note”). This Note amends and restates in its entirety the Second Amended Note, the First Amended Note and the Original Note
(collectively, the “Prior Notes”); provided that such amendment and restatement shall operate to renew, amend and modify the rights and obligations of the parties under each Prior Note, as provided herein, but shall not
extinguish the obligations under each Prior Note, nor effect a novation thereof. As of the close of business on December 31, 2012, the unpaid principal balance of the Second Amended Note was nil and the accrued and unpaid interest thereon was
nil which principal and accrued and unpaid interest are the unpaid principal and accrued and unpaid interest owed, respectively, under this Note as of the close of business on the date of this Note. 

Section 3. Place of Payment. All payments will be made at Noteholder’s address at Three
Lincoln Centre, 5430 LBJ Freeway, Suite 1700, Dallas, Texas 75240-2697, Attention: Treasurer, or such other place as Noteholder may from time to time appoint in writing. 

Section 4. Payments. The unpaid principal balance of this Note and any unpaid and accrued interest thereon
shall be due and payable on the Final Payment Date. Prior to the Final Payment Date, any unpaid and accrued interest on an unpaid principal balance shall be paid in arrears quarterly on the last day of each March, June, September and December,
commencing March 31, 2013. All payments on this Note shall be applied first to accrued and unpaid interest, next to accrued interest not yet payable and then to principal. If any payment of principal or interest on this Note shall become due on
a day that is not a Business Day, such payment shall be made on the next succeeding Business Day and the payment shall be the amount owed on the original payment date. 
 Section 5. Prepayments. This Note may be prepaid in part or in full at any time without penalty. 
 Section 6. Borrowings. Prior to the Final Payment Date, Noteholder expressly authorizes Borrower to borrow, repay and re-borrow principal under this Note in increments of
$100,000 on a daily basis so long as: 
  

	 	•	 	 the aggregate outstanding principal balance does not exceed $40,000,000.00; 

 

	 	•	 	 no Event of Default has occurred and is continuing. 

 Notwithstanding anything else in this Note, in no event will Noteholder be required to lend money to Borrower under this Note and loans under this Note shall be at the sole and absolute discretion of
Noteholder. 

  
 Page 1 of 4.

 Section 7. Interest. The unpaid principal balance of this
Note shall bear interest at the rate per annum of the Prime Rate less three quarters of a percent (0.75%). In the event that an Event of Default occurs and is continuing, the unpaid principal amount shall bear interest from the Event of Default at
the rate per annum of the Prime Rate plus four percent (4.00%) until such time as the Event of Default is cured. Accrued interest on the unpaid principal of this Note shall be computed on the basis of a 365- or 366-day year for actual days
(including the first, but excluding the last day) elapsed, but in no event shall such computation result in an amount of accrued interest that would exceed accrued interest on the unpaid principal balance during the same period at the Maximum Rate.
Notwithstanding anything to the contrary, this Note is expressly limited so that in no contingency or event whatsoever shall the amount paid or agreed to be paid to Noteholder exceed the Maximum Rate. If, from any circumstances whatsoever,
Noteholder shall ever receive as interest an amount that would exceed the Maximum Rate, such amount that would be excessive interest shall be applied to the reduction of the unpaid principal balance and not to the payment of interest, and if the
principal amount of this Note is paid in full, any remaining excess shall be paid to Borrower, and in such event, Noteholder shall not be subject to any penalties provided by any laws for contracting for, charging, taking, reserving or receiving
interest in excess of the highest lawful rate permissible under applicable law. All sums paid or agreed to be paid to Noteholder for the use, forbearance or detention of the indebtedness of Borrower to Noteholder shall, to the extent permitted by
applicable law, be amortized, prorated, allocated and spread throughout the full term of such indebtedness until payment in full of the principal (including the period of any renewal or extension thereof) so that the interest on account of such
indebtedness shall not exceed the Maximum Rate. If at any time the Contract Rate is limited to the Maximum Rate, any subsequent reductions in the Contract Rate shall not reduce the rate of interest on this Note below the Maximum Rate until the total
amount of interest accrued equals the amount of interest that would have accrued if the Contract Rate had at all times been in effect. In the event that, upon the Final Payment Date, the total amount of interest paid or accrued on this Note is less
than the amount of interest that would have accrued if the Contract Rate had at all times been in effect with respect thereto, then at such time, to the extent permitted by law, in addition to the principal and any other amounts Borrower owes to the
Noteholder, the Borrower shall pay to the Noteholder an amount equal to the difference between: (i) the lesser of the amount of interest that would have accrued if the Contract Rate had at all times been in effect or the amount of interest that
would have accrued if the Maximum Rate had at all times been in effect; and (ii) the amount of interest actually paid on this Note. 
 Section 8. Remedy. Upon the occurrence and during the continuation of an Event of Default, Noteholder shall have all of the rights and remedies provided in the applicable
Uniform Commercial Code, this Note or any other agreement with Borrower and in favor of Noteholder, as well as those rights and remedies provided by any other applicable law, rule or regulation. In conjunction with and in addition to the foregoing
rights and remedies of Noteholder, Noteholder may declare all indebtedness due under this Note, although otherwise unmatured, to be due and payable immediately without notice or demand whatsoever. All rights and remedies of Noteholder are cumulative
and may be exercised singly or concurrently. The failure to exercise any right or remedy will not be a waiver of such right or remedy. 
 Section 9. Right of Offset. Noteholder shall have the right of offset against amounts that may be due by Noteholder now or in the future to Borrower against amounts due
under this Note. 
 Section 10. Record of Outstanding Indebtedness. The date and amount of each
repayment of principal outstanding under this Note or interest thereon shall be recorded by Noteholder in its records. The principal balance outstanding and all accrued or accruing interest owed under this Note as recorded by Noteholder in its
records shall be the best evidence of the principal balance outstanding and all accrued or accruing interest owed under this Note; provided that the failure of Noteholder to so record or any error in so recording or computing any such amount
owed shall not limit or otherwise affect the obligations of Borrower under this Note to repay the principal balance outstanding and all accrued or accruing interest. 
 Section 11. Waiver. Borrower and each surety, endorser, guarantor, and other party now or subsequently liable for payment of this Note, severally waive demand, presentment
for payment, notice of nonpayment, notice of dishonor, protest, notice of protest, notice of the intention to accelerate, notice of acceleration, diligence in collecting or bringing suit against any party liable on this Note, and further agree to
any and all extensions, renewals, modifications, partial payments, substitutions of evidence of indebtedness, and the taking or release of any collateral with or without notice before or after demand by Noteholder for payment under this Note.

  
 Page 2 of 4.

 Section 12. Costs and Attorneys’ Fees. In addition to
any other amounts payable to Noteholder pursuant to the terms of this Note, in the event Noteholder incurs costs in collecting on this Note, this Note is placed in the hands of any attorney for collection, suit is filed on this Note or if
proceedings are had in bankruptcy, receivership, reorganization, or other legal or judicial proceedings for the collection of this Note, Borrower and any guarantor jointly and severally agree to pay on demand to Noteholder all expenses and costs of
collection, including, but not limited to, reasonable attorneys’ fees incurred in connection with any such collection, suit, or proceeding, in addition to the principal and interest then due. 

Section 13. Time of Essence. Time is of the essence with respect to all of Borrower’s obligations and
agreements under this Note. 
 Section 14. Jurisdiction and Venue. THIS NOTE SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC LAWS OF THE STATE OF TEXAS, WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE STATE OF TEXAS OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF
THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF TEXAS. BORROWER CONSENTS TO JURISDICTION IN THE COURTS LOCATED IN DALLAS, TEXAS. 
 Section 15. Notice. Any notice or demand required by this Note shall be deemed to have been given and received on the earlier of (i) when the notice or demand is
actually received by the recipient or (ii) 72 hours after the notice is deposited in the United States mail, certified or registered, with postage prepaid, and addressed to the recipient. The address for giving notice or demand under
this Note (i) to Noteholder shall be the place of payment specified in Section 3 or such other place as Noteholder may specify in writing to Borrower and (ii) to Borrower shall be the address below Borrower’s
signature or such other place as Borrower may specify in writing to Noteholder. 
 Section 16. Successors and
Assigns. All of the covenants, obligations, promises and agreements contained in this Note made by Borrower shall be binding upon its successors and permitted assigns, as applicable. Notwithstanding the foregoing, Borrower shall not
assign this Note or its performance under this Note without the prior written consent of Noteholder. 
 Section 17.
Definitions. For purposes of this Note, the following terms shall have the following meanings: 
 (a) “Business Day” shall mean any day banks are open in the state of Texas. 
 (b) “Contract Rate” means the amount of any interest (including fees, charges or expenses or any other amounts that, under applicable law, are deemed interest) contracted
for, charged or received by or for the account of Noteholder. 
 (c) “Event of
Default” wherever used herein, means any one of the following events: 
 (i) Borrower fails
to pay any amount due on this Note and/or any fees or sums due under or in connection with this Note after any such payment otherwise becomes due and payable and three Business Days after demand for such payment; 

(ii) Borrower otherwise fails to perform or observe any other provision contained in this Note and such breach or
failure to perform shall continue for a period of thirty days after notice thereof shall have been given to Borrower by Noteholder; 
 (iii) a case shall be commenced against Borrower, or Borrower shall file a petition commencing a case, under any provision of the Federal Bankruptcy Code of 1978, as amended, or shall seek relief
under any provision of any other bankruptcy, reorganization, arrangement, insolvency, readjustment of debt, dissolution or liquidation law of any jurisdiction, whether now or hereafter in effect, or shall consent to the filing of any petition
against it under such law, or Borrower shall make an assignment for the benefit of its creditors, or shall admit in writing its inability to pay its debts generally as they become due, or shall consent to the appointment of a receiver, trustee or
liquidator of Borrower or all or any part of its property; or 

  
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 (iv) an event occurs that, with notice or lapse of time, or both,
would become any of the foregoing Events of Default. 
 (d) “Final Payment Date”
shall mean the earlier of: 
  

	 	•	 	 written demand by Noteholder for payment of all or part of the principal and interest accrued and unpaid thereon, but in any event no earlier than
March 31, 2014; 

  

	 	•	 	 December 31, 2014; or 

  

	 	•	 	 acceleration as provided herein. 

 (e) “Maximum Rate” shall mean the highest lawful rate permissible under applicable law for the use, forbearance or detention of money. 

(f) “Prime Rate” shall mean the fluctuating interest rate per annum in effect from time to
time equal to the base rate on corporate loans as reported as the Prime Rate in the Money Rates column of The Wall Street Journal or other reliable source. 

 

			
	 BORROWER:
  

NL INDUSTRIES, INC.

		
	By:	 	 
		 	Gregory M. Swalwell, Vice President, Finance and Chief Financial Officer
	
	Address:
	
	5430 LBJ Freeway, Suite 1700
	Dallas, Texas 75240-2697

 As of the date hereof, CompX International Inc., as Noteholder, hereby agrees that this Note renews
and replaces, amends and restates in its entirety each Prior Note (but shall not extinguish the obligations under each Prior Note, nor effect a novation thereof) and that the unpaid principal of nil and the accrued and unpaid interest thereon of nil
that was owed under the Second Amended Note as of the close of business on December 31, 2012 are the unpaid principal and the accrued and unpaid interest thereon, respectively, owed under this Note as of the close of business on the date of
this Note. 
  

			
	COMPX INTERNATIONAL INC.
		
	By:	 	 
		 	Darryl R. Halbert
		 	Vice President, Chief Financial Officer and Controller

  
 Page 4 of 4.EX-10.1

 Exhibit 10.1 
 Yahoo! Executive Incentive Plan 

  
  

 
 (February 2013) 

 Yahoo! Executive Incentive Plan 

 
  

 

 I. Introduction 
 A. Applicability 
  

	 	1.	Employees eligible to participate in the Yahoo! Inc. Executive Incentive Plan (the “Executive Incentive Plan” or “this Plan”) are those employees of
Yahoo! Inc. and its subsidiaries (collectively, the “Company”) at job levels E4 and above (including EX). The Compensation Committee of Yahoo!’s Board of Directors (the “Compensation Committee”) has the sole discretion to
determine whether the Executive Incentive Plan will be offered to any executive for whom the Compensation Committee sets the executive’s compensation level (an “Executive Officer”). Yahoo!’s Chief Executive Officer
(“CEO”) or his or her designee will determine whether any other eligible person (other than an Executive Officer) is a participant. Participants will be notified in writing of their participation in this Plan for a particular fiscal year
(any person so notified who, if required by the Compensation Committee or the CEO in the circumstances, timely accepts participation on a form provided by the Company, is referred to as a “Participant”). Participation in this Plan for any
one fiscal year does not guarantee that the individual will be selected for participation in any other fiscal year. 

  

	 	2.	The Compensation Committee reserves the right to amend, modify or terminate the Executive Incentive Plan, in whole or in part, at any time, in its sole discretion
including, without limitation, to comply with applicable local law, rules and regulations; provided that, as to a Participant covered by the provisions of Section III as to a particular fiscal year, any such amendment as to such fiscal year as to
such Participant will be consistent with the intent that the Participant’s bonus opportunity for that fiscal year qualify as performance-based compensation under Section 162(m) of the U.S. Internal Revenue Code of 1986, as amended (the
“Code”). The Compensation Committee may remove any individual (and the CEO may remove any individual other than an Executive Officer) from participation in the Executive Incentive Plan at any time. 

B. Objectives of the Executive Incentive Plan 
  

	 	•	 	 To enhance the Company’s competitiveness and the Company’s ability to attract, motivate and retain top talent; 

 

	 	•	 	 To recognize the role of senior leadership in the success of the Company; 

 

	 	•	 	 To reward annual financial and individual performance that complements the Company’s longer-term strategic focus; and

  

	 	•	 	 To encourage collaboration and teamwork across the Company. 

 II. Executive Incentive Plan Elements 
 A. Target Awards 

A target cash bonus award (“Target Award”) will be established for each Participant. Target Awards are determined by position
level and will be typically expressed as a percentage of a Participant’s annual base salary rate as of the last day of the applicable fiscal year, where such salary rate does not include other forms of compensation (such as,

  
  

(February 2013) 
 2 

 Yahoo! Executive Incentive Plan 

 
  

 

 
without limitation, expense reimbursements, superannuation, bonus payments, long-term incentives, overtime compensation, and other variable compensation). Target Awards may also be a specified
fixed dollar (or local currency) amount. Target Awards for Executive Officers may be reviewed and revised in the sole discretion of the Compensation Committee. Target Awards for other Participants may be reviewed and revised in the sole discretion
of the CEO or his or her designee. 
 This Executive Incentive Plan and Target Awards do not constitute a guarantee of or
entitlement to a bonus payment. A Participant’s actual bonus payment may vary from his or her Target Award. 
 B.
Executive Incentive Plan Bonuses 
 Company performance measures, and any related goals, objectives, and performance scales
will be established for each fiscal year. Individual measures, goals, objectives and/or scales may also be established. Performance measures and other metrics may be the same for all Participants, or may differ from Participant to Participant. The
Compensation Committee will establish any performance measures, goals, objectives and scales as to the Executive Officers. Any performance measures, goals, objectives and scales for other Participants will be established by the CEO or his or her
designee. 
 Following the end of each fiscal year, a “Company Performance Factor” (indicating the extent of the
corresponding Company performance goals and objectives attained) and, if applicable, an “Individual Performance Factor” (evaluating the individual’s performance during the year including, if applicable, the individual’s relative
attainment of any individual performance goals and objectives) will be determined. Such determinations (including whether to include an Individual Peformance Factor) shall be made by the Compensation Committee (as to the Executive Officers) or by
the CEO or his or her designee (as to all other Participants). 
 A Participant’s Executive Incentive Plan bonus for a
particular fiscal year, subject to the other terms and conditions of this Plan, will equal the Participant’s Target Award for that fiscal year multiplied by the Company Performance Factor for that fiscal year and multiplied by (if applicable)
the Participant’s Individual Performance Factor for that fiscal year. 
 Notwithstanding the foregoing provisions, the
Compensation Committee (and, in the case of Participants other than Executive Officers, the CEO or his or her designee) retains discretion to reduce or eliminate the amount of any Executive Incentive Plan bonus otherwise payable. 

Any Executive Incentive Plan bonus payable to a Participant under this Plan shall not be considered as “salary” in any
circumstance and shall not be included in calculations for overtime pay, retirement benefits, severance, or any other benefits under any applicable plan, policy, agreement or applicable law. 

  
  

(February 2013) 
 3 

 Yahoo! Executive Incentive Plan 

 
  

 

 III. ADDITIONAL INDIVIDUAL LIMIT FOR CERTAIN PARTICIPANTS 

A. Section 162(m) Participants 
 The Compensation Committee may, within the first 90 days of a particular fiscal year (and, as to any fiscal year shorter than a whole calendar year, in all events during the first quarter of the fiscal
year), designate one or more Executive Officers (or any other employee of the Company) participating in this Plan for that fiscal year to be a “Section 162(m) Participant.” A Section 162(m) Participant’s Executive Incentive Plan
bonus for that fiscal year is (notwithstanding anything to the contrary above) subject to the limitations of this Section III. The intent of this Section III is to structure Executive Incentive Plan bonus opportunities for the Section 162(m)
Participants to qualify as performance-based compensation within the meaning of Section 162(m) of the Code (“Section 162(m)”). Accordingly, the Executive Incentive Plan will be construed and interpreted consistent with that intent as
to any Section 162(m) Participant for the fiscal year in question. As to the Section 162(m) Participants for a particular fiscal year, their Executive Incentive Plan bonus opportunities are structured as performance-based awards under
Appendix A to the Yahoo! Inc. 1995 Stock Plan, as amended (the “1995 Plan”). Any determination contemplated by the Executive Incentive Plan as to a Section 162(m) Participant for the applicable fiscal year will be made by the
Compensation Committee, and no Executive Incentive Plan bonus for a particular fiscal year may be paid to a Section 162(m) Participant unless and until the Compensation Committee certifies, by resolution or other appropriate action in writing,
that the bonus is not more than the Participant’s maximum bonus determined pursuant to this Section III for that fiscal year and that any other material terms applicable to the bonus were in fact satisfied. 

B. Maximum Bonus Amounts for Section 162(m) Participants 

The maximum aggregate bonus pool for the Section 162(m) Participants for a particular fiscal year will equal 3% of Yahoo! Inc.’s
Adjusted EBITDA for that fiscal year (the “Section 162(m) Bonus Pool”). “Adjusted EBITDA” is calculated as income from operations before depreciation, amortization and stock-based compensation expense, subject to adjustment as
provided below. Within the first 90 days of the fiscal year (and, as to any fiscal year shorter than a whole calendar year, in all events during the first quarter of the fiscal year), the Compensation Committee will, as to each Section 162(m)
Participant, establish the Participant’s maximum Executive Incentive Plan bonus for that fiscal year expressed as a percent of the Section 162(m) Bonus Pool for that fiscal year. (For example, if the Compensation Committee allocates 10% of
the Section 162(m) Bonus Pool to a particular Section 162(m) Participant for a particular fiscal year, the Section 162(m) Participant’s maximum Executive Incentive Plan bonus for that fiscal year will equal 10% of 3% of Yahoo!
Inc.’s Adjusted EBITDA for that fiscal year.) Notwithstanding the foregoing, in all cases a Section 162(m) Participant’s maximum Executive Incentive Plan bonus for a fiscal year will be subject to the limit of Section A.3 of the 1995
Plan. The Compensation Committee has discretion to reduce (but not increase) the maximum amount of a Section 162(m) Participant’s bonus determined pursuant to this Section III. For purposes of clarity, if the Compensation Committee
exercises its discretion to reduce the maximum amount of any Executive Incentive Plan bonus (or any Executive Incentive Plan bonus is otherwise not paid at the maximum amount), the amount of the difference may not be allocated to any other
Participant. 

  
  

(February 2013) 
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 Yahoo! Executive Incentive Plan 

 
  

 

 For purposes of calculating Adjusted EBITDA for a particular fiscal year, Adjusted
EBITDA for that year shall be further adjusted (without duplication) for the following items to the extent such items were not included in the Financial Plan for that year: 

 

	 	(a)	increased or decreased to eliminate the financial statement impact of acquisitions and costs associated with such acquisitions and the costs incurred in connection with
potential acquisitions that are required to be expensed under GAAP; 

  

	 	(b)	increased or decreased to eliminate the financial statement impact of divestitures and costs associated with such divestitures and the costs incurred in connection with
potential divestitures that are required to be expensed under GAAP; 

  

	 	(c)	increased or decreased to eliminate the financial statement impact of financing costs or costs related to the restructuring of any of the Company’s equity
investments (that are accounted for under the equity method of accounting) that are required to be expensed under GAAP; 

  

	 	(d)	increased or decreased to eliminate the financial statement impact of any new changes in accounting standards announced during the year that are required to be applied
during the year in accordance with GAAP; 

  

	 	(e)	increased or decreased to eliminate the financial statement impact of restructuring charges that are required to be expensed (or reversed) under GAAP;

  

	 	(f)	increased or decreased to eliminate the financial statement impact of goodwill and intangible and other asset impairment charges that are required to be recorded under
GAAP; 

  

	 	(g)	increased or decreased to eliminate the financial statement impact of legal settlements that have an impact on revenues or expenses under GAAP;

  

	 	(h)	increased or decreased to eliminate the financial statement impact of exiting, or substantially altering the terms or basis of operation of, a specific country,
property or offering; 

  

	 	(i)	increased or decreased to eliminate the financial statement impact of search costs to the extent such search costs are less than or exceed the estimated search costs
expected to be paid or reimbursed by Microsoft reflected in the Financial Plan solely as a result of the Microsoft Transition occurring earlier or later than the implementation plan incorporated in the Financial Plan; 

 

	 	(j)	increased or decreased to eliminate the financial statement impact of Microsoft revenue sharing solely as a result of the Microsoft Transition occurring earlier or
later than the implementation plan incorporated in the Financial Plan; 

  

	 	(k)	increased or decreased to eliminate the financial statement impact of changes in foreign exchange rates compared to the foreign exchange rates incorporated in the
Financial Plan; and 

  

	 	(l)	increased or decreased to eliminate the financial statement impact of any change to the planned end date or calculation method of the revenue per search guarantee
provided by Microsoft under the Search Agreement. 

  
  

(February 2013) 
 5 

 Yahoo! Executive Incentive Plan 

 
  

 

 “Financial Plan” as to a particular fiscal year means Yahoo! Inc.’s financial plan for
that fiscal year reviewed by the Board of Directors. “GAAP” means U.S. generally accepted accounting principles. “Microsoft Transition” means the global transition of Yahoo Inc.’s algorithmic and paid search platforms and
migration of the company’s paid search advertisers and publishers to Microsoft Corporation (“Microsoft”) under the Search Agreement based on the company’s timetable and operational plans as of the date of the Financial Plan.
“Search Agreement” means the Search and Advertising Services and Sales Agreement between Yahoo! Inc. and Microsoft. 
 IV. TERMS
AND CONDITIONS 
 A. Executive Incentive Plan Effective Period 

Each fiscal year covered by this Plan is the period from January 1 to December 31 of the applicable fiscal year. This Executive
Incentive Plan supersedes all previous executive cash incentive plans, management incentive plans (MIP), or leadership bonus plans and agreements and all other previous or contemporaneous oral or written statements by the Company on this subject.

 B. Date for Incentive Payments 
 Executive Incentive Plan bonuses paid under this Plan are not earned until paid and in all events remain subject to Section IV.M. It is a condition for Executive Incentive Plan eligibility that
Participants must be employed, and to the extent permitted by applicable law, not under notice of termination given by the Company or the Participant (if applicable), on the payment date of the Executive Incentive Plan bonuses (except as otherwise
provided below in Section I – Terminations of Employment). Payment will not occur until after financial results for the applicable fiscal year are determined by the Company and the year end review process for the applicable fiscal year is
completed. 
 C. Form and Timing of Payment 
 If the conditions for payment described above are met, the Executive Incentive Plan bonus will be payable in a lump sum cash payment (in local currency), subject to required payroll deductions and tax
withholdings no later than March 15 of the year following the end of the applicable fiscal year (except that, in the case of Participants not on the United States payroll of the Company at the start of the applicable fiscal year and who are not
added to the United States payroll of the Company during the applicable fiscal year, payment will occur not later than March 31 of the year following the end of the applicable fiscal year). 

D. New Hires 
 If an employee is hired on or before October 1 of the applicable fiscal year into a position that qualifies for the Executive Incentive Plan, the employee will participate in the Executive Incentive
Plan only if the Company notifies the employee in writing that he or she is a Participant under the Executive Incentive Plan for that year. The employee’s Target Award amount for the fiscal year may be prorated based on the date of hire.

 Employees who are hired after October 1 of the applicable fiscal year will not be considered Participants under the
Executive Incentive Plan for that fiscal year. 

  
  

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 Yahoo! Executive Incentive Plan 

 
  

 

 E. Transfers 

If a Participant transfers from one Executive Incentive Plan-eligible position to another during the applicable fiscal year, the following
guidelines shall apply, except as otherwise determined by the Compensation Committee with respect to Executive Officers (or CEO or his or her designee with respect to non-Executive Officers): 

 

	 	•	 	 If the Participant has a different Target Award upon transfer, his/her annual Target Award amount shall be prorated based on the Target Award
percentages for the amount of time spent in each position during the fiscal year. 

  

	 	•	 	 If a Participant transfers mid-year from an Executive Incentive Plan-eligible position to one that is not Executive Incentive Plan eligible (for
example, a transition from a role that participates in the Executive Incentive Plan to a position that is covered by a sales incentive plan), the Compensation Committee with respect to Executive Officers (or the CEO or his or her designee with
respect to non-Executive Officers), in its sole discretion, shall award the employee an Executive Incentive Plan bonus based on a prorated Executive Incentive Plan Target Award. Any such payment will be paid at the same time as other Executive
Incentive Plan payments are paid. 

  

	 	•	 	 Executive Incentive Plan eligibility for employees participating in a global assignment during the applicable fiscal year will be handled on a
case-by-case basis based on individual facts and circumstances. 

 The Compensation Committee with respect to
Executive Officers (and the CEO or his or her designee with respect to non-Executive Officers) has the sole discretion to pro-rate, reduce, offset, or eliminate Executive Incentive Plan bonuses to account for advances or payouts to employees under
other bonus plans in effect during the same fiscal year, or for other reasons as it deems appropriate. 
 F. Promotions into
Executive Incentive Plan-Eligible Positions 
 If a Participant is promoted from one Executive Incentive Plan-eligible
position to another during the applicable fiscal year, the payouts will be administered the same as described above for Transfers. If an employee is not in a position that is eligible for the Executive Incentive Plan and is promoted to an Executive
Incentive Plan-eligible position during the applicable fiscal year, the Compensation Committee or the CEO or his or her designee as applicable, may select the employee for participation in the Executive Incentive Plan by notifying the employee that
he or she is a Participant under the Executive Incentive Plan. The employee’s Target Award amount for the fiscal year shall be prorated based on the date of the promotion. 

G. Adjustments to Target Awards 
 The Compensation Committee in its sole discretion can approve adjustments to Target Awards for Executive Officers during the applicable fiscal year. The CEO or his or her designee in his or her sole
discretion may approve adjustments to Target Awards for other Participants during the applicable fiscal year. Any such changes will be communicated to the Participant in writing. Any payout amount may be prorated based on the effective date of the
change to the Target Award as determined by the Compensation Committee or the CEO or designee thereof, as applicable. 

  
  

(February 2013) 
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 Yahoo! Executive Incentive Plan 

 
  

 

 H. Leaves of Absence and Part-Time Employees 

To the extent permitted by applicable law, the amount of the Executive Incentive Plan bonus may be prorated for Participants who have been
on an approved leave of absence of more than 90 days during the fiscal year and for Participants who work less than full-time. 

I. Terminations of Employment 
 To the extent permitted by applicable law, and except as otherwise approved by the Compensation Committee (or the CEO in the case of non-Executive Officer Participants), Participants whose employment is
voluntarily or involuntarily terminated (with or without cause) by the Participant or the Company or are under notice of termination given by either party (if applicable) prior to the payment date of the Executive Incentive Plan bonus will not be
eligible for and shall not receive any Executive Incentive Plan bonus. 
 Participants whose employment terminates due to the
employee’s total disability during the applicable fiscal year will be eligible for a prorated Executive Incentive Plan bonus, based on the date of termination, and paid at the time other Executive Incentive Plan bonuses are paid under the
Executive Incentive Plan, to the extent permitted by applicable law. If a Participant dies during the applicable fiscal year, the Executive Incentive Plan bonus will be prorated based on the date of death and paid to the estate of the deceased
Participant, at the time other Executive Incentive Plan bonuses are paid. 
 J. Executive Incentive Plan Interpretation

 The Executive Incentive Plan shall be interpreted by the Compensation Committee. The Compensation Committee has the sole
discretion to interpret or construe ambiguous, unclear or implied (but omitted) terms and shall resolve any and all questions regarding interpretation and/or administration. 
 Participants who have issues regarding payments or the administration of the Executive Incentive Plan may file a claim in writing to the Compensation Committee, c/o the Secretary of the Company, within 90
days of the date on which the Participant first knew (or should have known) of the facts on which the claim is based. The Compensation Committee or its designee(s) shall consider the claim and notify the Participant in writing of the determination
and resolution of the issue. Claims that are not pursued through this procedure shall be treated as having been irrevocably waived. The determination of the Compensation Committee or its designee(s) as to any complaint or dispute will be final and
binding and shall be upheld unless arbitrary or capricious or made in bad faith. 
 The provisions of this Executive Incentive
Plan are severable and if any provision is held to be unenforceable by any court of competent jurisdiction then such unenforceability shall not affect the enforceability of the remaining Executive Incentive Plan provisions. 

This Plan shall be construed and interpreted consistent with, and so as to avoid the imputation of any tax, penalty or interest under,
Section 409A of the Code. 

  
  

(February 2013) 
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 Yahoo! Executive Incentive Plan 

 
  

 

 K. Exceptions and Modifications 

All exceptions, adjustments, additions, or modifications to the Executive Incentive Plan require the written approval of the Compensation
Committee, or its designee(s). 
 This version of the Executive Incentive Plan is first effective with respect to 2013. All
aspects of the Executive Incentive Plan (including, but not limited to, financial targets, Target Awards, performance measures, and funding formulas) may be reviewed and revised at any time without advance notice in the sole discretion of the
Compensation Committee. 
 L. Employment At-Will (U.S. Employees only) 

The employment of all Participants in the United States is “at will” and is terminable by either the Participant or Yahoo! at
any time, with or without advance notice and with or without cause. This Executive Incentive Plan shall not be construed to create a contract of employment for a specified period of time between Yahoo! and any U.S. Participant. 

M. Recoupment 
 Notwithstanding any other provision herein, the recoupment or “clawback” policies adopted by the Compensation Committee and applicable to incentive awards, as such policies are in effect from
time to time, shall apply to this Executive Incentive Plan and any bonuses paid or payable under this Executive Incentive Plan. 

  
  

(February 2013) 
 9

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