Document:

zbh-ex101_32.htm

Exhibit 10.1

ZIMMER BIOMET HOLDINGS, INC.

2009 STOCK INCENTIVE PLAN

THREE-YEAR PERFORMANCE-BASED RESTRICTED STOCK UNIT AWARD

 

 

To encourage your continued employment with Zimmer Biomet Holdings, Inc. (the “Company”) or its Affiliates, you have been granted this restricted stock unit (“RSU”) award (“Award”) pursuant to the Company’s 2009 Stock Incentive Plan (“Plan”).  Each RSU represents an unfunded, unsecured promise by the Company to deliver one share of Common Stock (“Share”) to you, subject to the fulfillment of the vesting requirements set forth in this agreement and in Annex A to this agreement (collectively, the “Agreement”) and all other restrictions, terms and conditions contained in this Agreement and in the Plan.  Except as may be required by law, you are not required to make any payment (other than payments for Tax-Related Items pursuant to Section 7 hereof) or provide any consideration other than the rendering of future services to the Company or its Affiliates.  Capitalized terms that are not defined in this Agreement have the meanings given to them in the Plan.

Important Notice.  If you do not wish to receive the RSUs and/or do not consent and agree to the terms and conditions on which the RSUs are offered, as set forth in this Agreement and the Plan, then you must reject the RSUs no later than 60 days following the Grant Date specified in Section 1 hereof.  If you reject the Award, any right to the underlying RSUs will be cancelled.  Your failure to reject the Award within this 60-day period will constitute your acceptance of the RSUs and your agreement with all terms and conditions of the Award, as set forth in this Agreement and the Plan.

1.Grant Date  _______ __, 2018 the “Grant Date”).

2.Number of RSUs Subject to this Award  The target number of RSUs subject to this Award was communicated to you separately and is posted to your online Zimmer Biomet long-term incentive plan account (administered as of the Grant Date by Computershare).

3.Vesting Schedule  This Award is based on a three-year performance period from January 1, 2018 to December 31, 2020 (the “Performance Period”) and includes three measurement periods within that Performance Period as set forth in Annex A.  No RSUs will be earned with respect to any measurement period unless and until the Committee determines the extent to which the performance criteria set forth in Annex A have been met with respect to such measurement period.  As soon as 

practicable following the availability of audited results of the Company for the last year in each measurement period, the Committee will determine whether and the extent to which the performance criteria in Annex A have been satisfied and the number of RSUs earned with respect to that measurement period (“Earned RSUs”).  Except as otherwise set forth in Sections 6, 15 and 16 below, provided that you have been continuously employed by the Company or its Affiliates since the Grant Date, (i) the Earned RSUs, if any, with respect to the first measurement period will become vested and nonforfeitable on the first anniversary of the Grant Date (or, if later, the date the Committee makes its determination) (the “First Scheduled Vest Date”); (ii) the Earned RSUs, if any, with respect to the second measurement period will become vested and nonforfeitable on the second anniversary of the Grant Date (or, if later, the date the Committee makes its determination) (the “Second Scheduled Vest Date”); and (iii) the Earned RSUs, if any, with respect to the third measurement period will become vested and nonforfeitable on the third anniversary of the Grant Date (or, if later, the date the Committee makes its determination) (the “Third Scheduled Vest Date”).  The period from the Grant Date until the Third Scheduled Vest Date is referred to in this Agreement as the “Restriction Period”.

4.Stockholder Rights  You will have none of the rights of a holder of Common Stock (including any voting rights, rights with respect to cash dividends paid by the Company on its Common Stock or any other rights whatsoever) until the Award is settled by the issuance of Shares to you.

5.Conversion of Earned RSUs and Issuance of Shares  Subject to the terms and conditions of this Agreement and the Plan, the Company will transfer Shares to you within 60 days after each of the First Scheduled Vest Date, the Second Scheduled Vest Date and the Third Scheduled Vest Date for Earned RSUs.  No fractional Shares will be issued under this Agreement.  The Company will not be required to issue or deliver any Shares prior to (a) the admission of such Shares to listing on any stock exchange on which the stock may then be listed, (b) the completion of any registration or other qualification of such Shares under any state or federal law or rulings or regulations of any governmental regulatory body, or (c) the obtaining of any consent or approval or other clearance from any governmental agency, which the Company shall, in its sole discretion, determine to be necessary or advisable.  The 

Three-Year Performance-Based RSU Award (2018) 1

Exhibit 10.1

Company reserves the right to determine the manner in which the Shares are delivered to you, including but not limited to delivery by direct registration with the Company’s transfer agent.

6.Termination of Employment  

(a)For all purposes of this Agreement, the term “Employment Termination Date” shall mean the earlier of (i) the date, as determined by the Company, that you are no longer actively employed by the Company or an Affiliate of the Company, and in the case of an involuntary termination, such date shall not be extended by any notice period mandated under local law (e.g., active employment would not include any contractual notice period or any period of “garden leave” or similar period mandated under employment laws in the jurisdiction where you are employed or the terms of your employment agreement, if any); or (ii) the date, as determined by the Company, that your employer is no longer an Affiliate of the Company.

(b)(i) A transfer of your employment from the Company to an Affiliate, or vice versa, or from one Affiliate to another, (ii) a leave of absence, duly authorized in writing by the Company, for military service or sickness or for any other purpose approved by the Company if the period of such leave does not exceed ninety (90) days, and (iii) a leave of absence in excess of ninety (90) days, duly authorized in writing by the Company, provided your right to reemployment is guaranteed either by a statute or by contract, shall not be deemed a termination of employment.  However, your failure to return to the employ of the Company at the end of an approved leave of absence shall be deemed a termination.  During a leave of absence as defined in (ii) or (iii), you will be considered to have been continuously employed by the Company.

(c)Except as set forth below, if your Employment Termination Date occurs before the Third Scheduled Vest Date, RSUs subject to this Award that are not already vested as of your Employment Termination Date shall be forfeited and immediately cancelled.

(d)If after you have been continuously employed by the Company or its Affiliates for one year or more from the Grant Date, you terminate employment on account of Retirement or death, all time-based restrictions imposed under this Award will lapse as of your Employment Termination Date, but this Award will continue to be subject to the satisfaction of the performance criteria set forth in Annex A; the number of Earned RSUs, if any, for each measurement period, as determined by the Committee, will vest and become nonforfeitable on 

the Scheduled Vest Date applicable to such measurement period (subject to any applicable requirements described in the definition of “Retirement” in the Plan).

(e)In the event of your death prior to the delivery of Shares issuable pursuant to Earned RSUs under this Agreement, such Shares shall be delivered to the duly appointed legal representative of your estate or to the proper legatees or distributees thereof, upon presentation of documentation satisfactory to the Committee.

7.Responsibility for Taxes

(a)You acknowledge that, regardless of any action taken by the Company or, if different, your actual employer (the “Employer”), the ultimate liability for all income tax (including federal, state and local taxes), social insurance, payroll tax, fringe benefits tax, payment on account or other tax-related items related to your participation in the Plan and legally applicable to you or deemed by the Company or the Employer to be an appropriate charge to you even if legally applicable to the Company or the Employer (“Tax-Related Items”) is and remains your responsibility and may exceed the amount, if any, actually withheld by the Company or the Employer.  You further acknowledge that the Company and/or the Employer (i) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the RSUs, including the grant of the Award, the vesting or settlement of the RSUs, the conversion of the RSUs into Shares, the subsequent sale of any Shares acquired at vesting or the receipt of any dividends; and (ii) do not commit to, and are under no obligation to, structure the terms or any aspect of the Award to reduce or eliminate your liability for Tax-Related Items or achieve any particular result.  Further, if you are subject to Tax-Related Items in more than one jurisdiction, you acknowledge that the Company or the Employer (or former Employer, as applicable) may be required to withhold or account for Tax-Related Items in more than one jurisdiction.

(b)Prior to any relevant taxable or tax withholding event, as applicable, you agree to pay, or make adequate arrangements satisfactory to the Company or to the Employer (in their sole discretion) to satisfy all Tax-Related Items.  In this regard and, if permissible under local law, you authorize the Company and/or the Employer, at their discretion, to satisfy any applicable obligations with respect to all Tax-Related Items in one or a combination of the following:  (i) requiring you to pay an amount necessary to pay the Tax-Related Items directly to the Company (or the Employer) in the form of cash, 

Three-Year Performance-Based RSU Award (2018) 2

check or other cash equivalent; (ii) withholding such amount from wages or other cash compensation payable to you by the Company and/or the Employer; (iii) withholding from proceeds of the sale of Shares acquired upon settlement of the RSUs either through a voluntary sale or through a mandatory sale arranged by the Company (on your behalf pursuant to this authorization or such other authorization, without further consent, as you may be required to provide to the Company or Computershare (or any other designated broker)); or (iv) withholding in Shares to be issued upon settlement of the RSUs.  If you are a Section 16 officer of the Company under the Exchange Act (“Section 16 officer”) who is primarily providing services in the U.S., withholding obligations for Tax-Related Items shall be satisfied by the mandatory withholding in Shares.  If you are a Section 16 officer who is primarily providing services outside the U.S., any withholding in Shares to satisfy applicable withholding obligations shall be determined by the Committee prior to the applicable withholding event.

(c)Depending on the withholding method, the Company and /or the Employer may withhold or account for Tax-Related Items by considering applicable minimum statutory withholding amounts or other applicable withholding rates in your jurisdiction, including maximum applicable rates, in which case you may receive a refund of any over-withheld amount in cash and will have no entitlement to the Shares, and you agree that the amount withheld may exceed your actual liability.  If the obligation for Tax-Related Items is satisfied by withholding in Shares, for tax purposes, you are deemed to have been issued the full number of Shares subject to the vested RSUs, notwithstanding that a number of the Shares are held back solely for the purpose of paying the Tax-Related Items.

(d)Finally, you agree to pay to the Company or the Employer any amount of Tax-Related Items that the Company or the Employer may be required to withhold or account for as a result of your participation in the Plan that cannot be satisfied by the means previously described.  The Company may refuse to issue or deliver the Shares or the proceeds of the sale of Shares, if you fail to comply with your obligations in connection with the Tax-Related Items.

8.Nature of Grant  In accepting the RSUs, you acknowledge, understand and agree that: 

(a) the Plan is established voluntarily by the Company, it is discretionary in nature and may be modified, amended, suspended or terminated by the Company at any time, as provided in the Plan; 

(b) the Award is exceptional, discretionary, voluntary and occasional and does not create any contractual or other right to receive future awards of RSUs, or benefits in lieu of RSUs even if RSUs have been awarded in the past; 

(c) all decisions with respect to future RSU or other awards, if any, will be at the sole discretion of the Company; 

(d) the Award and your participation in the Plan shall not create a right to employment or be interpreted as forming an employment or service contract with the Company, the Employer or any Affiliate of the Company and shall not interfere with the ability of the Company, the Employer or any Affiliate of the Company, as applicable to terminate your employment or service relationship (if any); 

(e) your participation in the Plan is voluntary; 

(f) the Award, the Shares subject to the RSUs, and the income from and value of same are not intended to replace any pension rights or compensation; 

(g) the Award and the Shares subject to the RSUs, and the income from and value of same are not part of normal or expected compensation for purposes of calculation of any severance, resignation, termination, redundancy, dismissal, end-of-service payments, holiday pay, bonuses, long-service awards, pension or retirement benefits or similar mandatory payments; 

(h) the future value of the Shares underlying the RSUs is unknown, indeterminable and cannot be predicted with certainty;  

(i) no claim or entitlement to compensation or damages arises from forfeiture of RSUs resulting from termination of your employment or other service relationship with the Company or the Employer (regardless of the reason for such termination and whether or not later found to be invalid or in breach of employment laws in the jurisdiction where you are employed or the terms of your employment agreement, if any), or resulting from a breach or violation as described in Section 15 or Section 16 below; 

(j) unless otherwise provided in the Plan or by the Company in its discretion, the RSUs and the benefits evidenced by this Agreement do not create any entitlement to have the RSUs or any such benefits transferred to, or assumed by, another company, nor to be exchanged, cashed out or substituted for, in connection with any corporate transaction affecting the Shares of the Company; and 

Three-Year Performance-Based RSU Award (2018) 3

(k) the following provisions apply only if you are providing services outside the United States: (i) the Award and the Shares subject to the RSUs are not part of normal or expected compensation or salary for any purpose; (ii) neither the Company, the Employer nor any other Affiliate of the Company shall be liable for any foreign exchange rate fluctuation between your local currency and the United States Dollar that may affect the value of the RSUs or of any amounts due to you pursuant to the settlement of the RSUs or the subsequent sale of any Shares acquired upon settlement.

9.No Advice Regarding Grant  The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding your participation in the Plan, or your acquisition or sale of the underlying Shares.  You should consult with your own personal tax, legal and financial advisors regarding your participation in the Plan before taking any action related to the Plan.

10.Data Privacy  You hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal data as described in this Agreement and any other RSU Award materials (“Data”) by and among, as applicable, the Company, the Employer and any other Affiliates for the exclusive purpose of implementing, administering and managing your participation in the Plan.

You understand that the Company and the Employer may hold certain personal information about you, including, but not limited to, your name, home address and telephone number, email address, date of birth, social insurance, passport or other identification number (e.g. resident registration number), salary, nationality, job title, any Shares or directorships held in the Company, details of all RSUs or any other stock-based awards, canceled, exercised, vested, unvested or outstanding in your favor, for the exclusive purpose of implementing, administering and managing the Plan.  

You understand that Data may be transferred to Computershare or such other stock plan service provider as may be selected by the Company to assist the Company with the implementation, administration and management of the Plan.  You understand that the recipients of the Data may be located in the United States or elsewhere, and that the recipients’ country may have different data privacy laws and protections than your country.  You understand that if you reside outside the United States, you may request a list with the names and addresses of any potential recipients of the Data by 

contacting your local human resources representative.  You authorize the Company, Computershare and any other possible recipients which may assist the Company (presently or in the future) with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purpose of implementing, administering and managing your participation in the Plan.  You understand that Data will be held only as long as is necessary to implement, administer and manage your participation in the Plan.  You understand that if you reside outside the United States, you may, at any time, view Data, request information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing your local human resources representative.  

Further, you understand that you are providing the consents herein on a purely voluntary basis.  If you do not consent, or if you later seek to revoke your consent, your employment status or service with the Employer will not be affected; the only consequence of refusing or withdrawing your consent is that the Company would not be able to grant RSUs or any other equity awards to you or administer or maintain such awards.  Therefore, you understand that refusing or withdrawing your consent may affect your ability to participate in the Plan.  For more information on the consequences of your refusal to consent or withdrawal of consent, you understand that you may contact your local human resources representative.

Finally, upon the request of the Company or the Employer, you agree to provide an executed data privacy consent form (or any other agreements or consents) that the Company and/or the Employer may deem necessary to obtain from you for the purpose of administering your participation in the Plan in compliance with the data privacy laws in your country, either now or in the future. You understand and agree that you will not be able to participate in the Plan if you fail to provide any such consent or agreement requested by the Company and/or the Employer.

11.Change in Control  Under certain circumstances, if your employment with the Company or its Affiliates terminates during the three year period following a Change in Control of the Company, this Award may be deemed vested.  Please refer to the Plan for more information.

12.Changes in Capitalization  If prior to the expiration of the Restriction Period changes occur in 

Three-Year Performance-Based RSU Award (2018) 4

the outstanding Common Stock by reason of stock dividends, recapitalization, mergers, consolidations, stock splits, combinations or exchanges of Shares and the like, the number and class of Shares subject to this Award will be appropriately adjusted by the Committee, whose determination will be conclusive.  If as a result of any adjustment under this paragraph you should become entitled to a fractional Share of stock, you will have the right only to the adjusted number of full Shares and no payment or other adjustment will be made with respect to the fractional Share so disregarded.

13.Notice  Until you are advised otherwise by the Committee, all notices and other correspondence with respect to this Award will be effective upon receipt at the following address:  Zimmer Biomet Holdings, Inc., ATTN: Employee Stock Services, 345 East Main Street, Post Office Box 708, Warsaw, Indiana  46581-0708, U.S.A.

14.No Additional Rights  Except as explicitly provided in this Agreement, this Agreement will not confer any rights upon you, including any right with respect to continuation of employment by the Company or any of its Affiliates or any right to future awards under the Plan.  In no event shall the value, at any time, of this Agreement, the Shares covered by this Agreement or any other benefit provided under this Agreement be included as compensation or earnings for purposes of any other compensation, retirement, or benefit plan offered to employees of the Company or its Affiliates unless otherwise specifically provided for in such plan.

15.Breach of Restrictive Covenants  As a condition of receiving this Award, you have entered into a non-disclosure, non-solicitation and/or non-competition agreement with the Company or its Affiliates.  The Company may, at its discretion, require execution of a restated non-disclosure, non-solicitation and/or non-competition agreement as a condition of receiving the Award.  Should you decline to sign such a restated agreement as required by the Company and, therefore, forego receiving the Award, your most recently signed non-disclosure, non-solicitation and/or non-competition agreement shall remain in full force and effect.  You understand and agree that if you violate any provision of any such agreement that remains in effect at the time of the violation, the Committee may require you to forfeit your right to any unvested portion of the Award and, to the extent that any portion of the Award has previously vested, the Committee may require you to return to the Company the Shares covered by the Award or any cash proceeds you received upon the sale of such Shares.

16.Violation of Policies  Notwithstanding any other provisions of this Agreement, you understand and agree that if you engage in conduct (which may include a failure to act) in connection with, or that results in, a violation of any of the Company’s policies, procedures or standards, a violation of the Company’s Code of Business Conduct and Ethics, or that is deemed detrimental to the business or reputation of the Company, the Committee may, in its discretion, require you to forfeit your right to any unvested portion of the Award and, to the extent that any portion of the Award has previously vested, the Committee may require you to return to the Company the Shares covered by the Award or any cash proceeds you received upon the sale of such Shares.  The Committee may exercise this discretion at any time that you are employed by the Company or any Affiliate of the Company, and at any time during the 18-month period following the termination of your employment with the Company or any Affiliate of the Company for any reason, including, without limitation, on account of Retirement or death.  

17.Consent to Electronic Delivery  The Company may, in its sole discretion, decide to deliver any documents related to current or future participation in the Plan by electronic means.  You hereby consent to receive such documents by electronic delivery and agree to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.

18.Code Section 409A Compliance  To the extent applicable, it is intended that the Plan and this Agreement comply with the requirements of Section 409A of the U.S. Internal Revenue Code of 1986, as amended, and any related regulations or other guidance promulgated with respect to such Section by the U.S. Department of the Treasury or the Internal Revenue Service.  The RSUs granted in this Award are intended to be short-term deferrals exempt from Section 409A, but in the event that any portion of this Award constitutes deferred compensation within the meaning of Section 409A, then the issuance of Shares covered by an RSU award shall conform to the Section 409A standards, including, without limitation, the requirement that no payment on account of separation from service will be made to any specified employee (within the meaning of Section 409A) until six months after the separation from service occurs, and the prohibition against acceleration of payment, which means that the Committee does not have the authority to accelerate settlement of this Award in the event that any portion of it constitutes deferred compensation within the meaning of Section 409A.  Any provision of the Plan 

Three-Year Performance-Based RSU Award (2018) 5

or this Agreement that would cause this Award to fail to satisfy any applicable requirement of Section 409A shall have no force or effect until amended to comply with Section 409A, which amendment may be retroactive to the extent permitted by Section 409A.

19.Construction and Interpretation  The Board of Directors of the Company (the “Board”) and the Committee shall have full authority and discretion, subject only to the express terms of the Plan, to decide all matters relating to the administration and interpretation of the Plan and this Agreement and all such Board and Committee determinations shall be final, conclusive, and binding upon you and all interested parties.  The terms and conditions set forth in this Agreement are subject in all respects to the terms and conditions of the Plan, as amended from time to time, which shall be controlling.  This Agreement and the Plan contain the entire understanding of the parties and this Agreement may not be modified or amended except in writing duly signed by the parties.  You acknowledge that a waiver by the Company of breach of any provision of this Agreement shall not operate or be construed as a waiver of any other provision of this Agreement, or of any subsequent breach by you or any other party to this Agreement.  The various provisions of this Agreement are severable and in the event any provision of this Agreement shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining provisions of this Agreement, and this Agreement shall be construed and enforced as if such illegal or invalid provision had not been included.  This Agreement will be binding upon and inure to the benefit of the successors, assigns, and heirs of the respective parties.  

The validity and construction of this Agreement shall be governed by the laws of the State of Indiana, excluding any conflicts or choice of law rule or principle that might otherwise refer construction or interpretation of this Agreement to the substantive law of another jurisdiction.  For purposes of litigating any dispute arising under this Agreement, the parties hereby submit and consent to the jurisdiction of the State of Indiana, agree that such litigation shall be conducted in the courts of Kosciusko County Indiana, or the federal courts for the United States for the Northern District of Indiana, where this grant is made and/or to be performed. 

You acknowledge that you are proficient in the English language and understand the provisions of this Agreement and the Plan.  If you have received this Agreement or any other document related to the Plan translated into a language other than English and 

if meaning of the translated version is different from the English version, the English version will control.

20.Insider Trading/Market Abuse Laws  You acknowledge that you may be subject to insider trading restrictions and/or market abuse laws based on the exchange on which the Shares are listed in applicable jurisdictions, including the United States; your country  or the country of the applicable stock plan service provider, which may affect your ability to accept, acquire, sell, attempt to sell or otherwise dispose of Shares, rights to Shares (e.g., RSUs) or rights linked to the value of Shares during such times as you are considered to have “inside information” regarding the Company (as defined by the laws or regulations in applicable jurisdictions).  Local insider trading laws and regulations may prohibit the cancellation or amendment of orders you placed before you possessed inside information. Furthermore, you could be prohibited from (i) disclosing the inside information to any third party, including fellow employees (other than on a “need to know” basis) and (ii) “tipping” third parties or causing them otherwise to buy or sell securities.  Any restrictions under these laws or regulations are separate from and in addition to any restrictions that may be imposed under any applicable insider trading policy of the Company.  You acknowledge that it is your responsibility to comply with any applicable restrictions, and you should speak to your personal advisor on this matter.

21.Foreign Asset/Account Reporting  Please be aware that your country may have certain foreign asset and/or account reporting requirements which may affect your ability to acquire or hold Shares under the Plan or cash received from participating in the Plan (including from any dividends received or sale proceeds arising from the sale of Shares) in a brokerage or bank account outside your country.  You may be required to report such accounts, assets or transactions to the tax or other authorities in your country.  You acknowledge that it is your responsibility to be compliant with such regulations, and you should speak to your personal advisor on this matter.

22.Compliance with Laws and Regulations  Notwithstanding any other provisions of this Agreement, you understand that the Company will not be obligated to issue any Shares pursuant to the vesting of the RSUs if the issuance of such Shares shall constitute a violation by you or the Company of any provision of law or regulation of any governmental authority.  Any determination by the Company in this regard shall be final, binding and conclusive.

Three-Year Performance-Based RSU Award (2018) 6

23.Addendum  Your Award shall be subject to any special provisions set forth in the Addendum to this Agreement for your country, if any.  If you relocate to one of the countries included in the Addendum during the Restriction Period, the special provisions for such country shall apply to you, to the extent the Company determines that the application of such provisions is necessary or advisable for legal or administrative reasons.  The Addendum, if any, constitutes part of this Agreement.

24.Imposition of Other Requirements  The Company reserves the right to impose other requirements on your participation in the Plan, on the Award and on any Shares acquired under the Plan, to the extent the Company determines it is necessary or advisable for legal or administrative reasons, and to require you to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing.

25.Recoupment  Any benefits you may receive hereunder shall be subject to repayment or forfeiture 

as may be required to comply with (i) any applicable listing standards of a national securities exchange adopted in accordance with Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (regarding recovery of erroneously awarded compensation) and any implementing rules and regulations of the U.S. Securities and Exchange Commission adopted thereunder; (ii) similar rules under the laws of any other jurisdiction; and (iii) any policies adopted by the Company to implement such requirements, all to the extent determined by the Company in its discretion to be applicable to you.

26.Acceptance  If you do not agree with the terms of this Agreement and the Plan, you must reject the Award no later than 60 days following the Grant Date; non-rejection of the Award will constitute your acceptance of the Award on the terms on which they are offered, as set forth in this Agreement and the Plan.

 

ZIMMER BIOMET HOLDINGS, INC.

By:  

     Chad F. Phipps

     Senior Vice President, 

     General Counsel and Secretary

 

Three-Year Performance-Based RSU Award (2018) 7

Annex A

PERFORMANCE CRITERIA

 

Performance will be measured 50% on revenue growth and 50% on relative total shareholder return (TSR), as described further below.  

	
 
	
•
	
Performance on each metric will be measured over a one-year (2018), two-year (2018-2019) and three-year (2018-2020) period relative to 2017.

	
 
	
•
	
There is a possible payout following each of the three measurement periods.

	
 
	
•
	
The revenue and TSR component payouts will be determined independently and then added together for the total payout for each of the three measurement periods.

	
 
	
•
	
As illustrated in the below table, RSUs not earned in an earlier measurement period due to below-target performance may be earned in a later measurement period as a result of improved performance.  Further, above-target performance in the third measurement period will result in RSUs being earned above target on the entire award; however, the cumulative payout over the three measurement periods may not exceed 200% of the target award.

 

				
	
Possible Payouts as a Cumulative Percentage of Target Award

	
Measurement Period
	
1
	
2
	
3

	
 
	
2018
	
2018-2019
	
2018-2020

	
Payout Range*
	
0% - 33%
	
0% - 67%
	
0% - 200%

	
Scheduled Vest Date**
	
March 20, 2019
	
March 20, 2020
	
March 20, 2021

	
 

	
*Payout as a cumulative percentage of target number of RSUs subject to this award; the grand total of the three payouts may not exceed 200% of the target award

** Scheduled Vest Date is later of date indicated or  the date the Committee determines whether and the extent to which the performance criteria have been satisfied and the number of RSUs earned with respect to that measurement period

 

 

					
	
Revenue Growth Component (50%)

	
•Constant currency, compound annual growth rate (CAGR)

	
 

	
Revenue CAGR Over 2017

	
Measurement Period
	
1
	
2
	
3
	
 

	
 
	
2018
	
2018-2019
	
2018-2020
	
Payout*

	
Stretch
	
 
	
 
	
%
	
200%

	
 
	
 
	
 
	
%
	
150%

	
Target
	
%
	
%
	
%
	
100%

	
Threshold
	
%
	
%
	
%
	
50%

	
Below Threshold
	
%
	
%
	
%
	
0%

	
 

	
*Period 1 Payout = (Payout percentage) x (1/2 of RSUs subject to this award) x (1/3)
Period 2 Payout = Excess, if any, of [(Payout percentage) x (1/2 of RSUs subject to this award) x (2/3)] over Period 1 Payout
Period 3 Payout = Excess, if any, of [(Payout percentage) x (1/2 of RSUs subject to this award)] over [Period 1 Payout + Period 2 Payout]

 

 

					
	
Relative Total Shareholder Return (TSR) Component (50%)

	
•TSR measured against the S&P 500 Health Care Index constituents

	
•Payout under this component will be capped at target if Zimmer Biomet’s TSR is negative

	
 

	
Relative TSR (%ile)

	
Measurement Period
	
1
	
2
	
3
	
 

	
 
	
2018
	
2018-2019
	
2018-2020
	
Payout*

	
Stretch
	
 
	
 
	
%
	
200%

	
 
	
 
	
 
	
%
	
150%

	
Target
	
%
	
%
	
%
	
100%

	
Threshold
	
%
	
%
	
%
	
50%

	
Below Threshold
	
%
	
%
	
%
	
0%

	
 

	
*Period 1 Payout = (Payout percentage) x (1/2 of RSUs subject to this award) x (1/3)
Period 2 Payout = Excess, if any, of [(Payout percentage) x (1/2 of RSUs subject to this award) x (2/3)] over Period 1 Payout
Period 3 Payout = Excess, if any, of [(Payout percentage) x (1/2 of RSUs subject to this award)] over [Period 1 Payout + Period 2 Payout]

 

Three-Year Performance-Based RSU Award (2018) 8Exhibit

GARTNER, INC.

2014 LONG-TERM INCENTIVE PLAN

STOCK APPRECIATION RIGHT AGREEMENT
Gartner, Inc. (the “Company”) hereby grants you (or the “Grantee”) a stock appreciation right (the “SAR”) under the Company’s 2014 Long-Term Incentive Plan (the “Plan”) to exercise in exchange for a payment from the Company pursuant to this SAR.  The date of this Agreement is February 8, 2018 (the “Grant Date”).  In general, the latest date this SAR will expire is February 8, 2025 (the “Expiration Date”).  However, as provided in Appendix A (attached hereto), this SAR may expire earlier than the Expiration Date.  Subject to the provisions of Appendix A and of the Plan, the principal features of this SAR are as follows:
Number of Shares to which this SAR pertains: As provided in the notice of grant.     
Exercise Price per Share: As provided in the notice of grant.
Vesting Schedule:

Twenty-five percent (25%) of the Shares to which this SAR pertains shall vest on each of the first four anniversaries of the date hereof, or February 8, 2019, 2020, 2021 and 2022, subject to Grantee’s Continued Service through each such date.

APPENDIX A
TERMS AND CONDITIONS OF STOCK APPRECIATION RIGHTS
1.Grant of SAR.  The Company hereby grants to the Grantee under the Plan, as a separate incentive in connection with his or her employment and not in lieu of any salary or other compensation for his or her services, a Stock Appreciation Right (“SAR”) pertaining to all or any part of an aggregate of Shares shown on the attached notice of grant, which SAR entitles the Grantee to exercise the SAR in exchange for Shares in the amount determined under Paragraph 9 below; provided, however, that notwithstanding any contrary provision of this Agreement (including, but not limited to, the notice of grant), should Grantee’s Continued Service end at any time during the calendar year in which the grant was made, then the number of Shares to which this SAR pertains will be reduced to equal the percentage of days in that year in which the Grantee was in Continued Service (i.e., for the avoidance of doubt, the number of Shares will equal the number specified in the notice of grant, multiplied by the number of days from January 1 for which the Grantee was in Continued Service, divided by 365).  
2.    Exercise Price.  The purchase price per Share for this SAR (the “Exercise Price”) shall be $99.07, which is the Fair Market Value of a Share on the Grant Date.  When the SAR is exercised, the purchase price will be deemed paid by the Grantee for the exercised portion of the SAR through the past services rendered by the Grantee, and will be subject to any appropriate tax withholdings.

3.    Vesting Schedule.  Except as otherwise provided in this Agreement, the right to exercise this SAR will vest in accordance with the vesting schedule set forth in the notice of grant which constitutes part of this Agreement.  Shares scheduled to vest on any date will vest only if the Grantee remains in Continued Service through such date.  Should the Grantee’s Continued Service end at any time (the “Termination Date”), any unvested portion of this SAR will be immediately cancelled; provided, however, that if termination of Continued Service results from the Grantee’s death, Disability or Retirement, then any unvested portion of this SAR shall vest as follows:

		
	(a)
	If termination of Continued Service is due to the Grantee’s death or Disability, the unvested portion of this SAR shall vest in full on the Termination Date; 

		
	(b)
	If termination of Continued Service is due to Retirement and the Grantee is less than age 60, the unvested portion of this SAR that would have vested by its terms within twelve (12) months from the Termination Date shall continue to vest as set forth in the notice of grant despite the termination of service;  

		
	(c)
	If termination of Continued Service is due to Retirement and the Grantee is age 60 (but less than age 61) on the Termination Date, the unvested portion of this SAR that would have vested by its terms within twenty-four (24) months from the Termination Date shall continue to vest as set forth in the notice of grant despite the termination of service; 

		
	(d)
	If termination of Continued Service is due to Retirement and the Grantee is age 61 (but less than age 62) on the Termination Date, the unvested portion of this SAR that would have vested by its terms within thirty-six (36) months from the Termination Date shall continue to vest as set forth in the notice of grant despite the termination of service; and  

(e)    If termination of Continued Service is due to Retirement and the Grantee is     age 62 or older on the Termination Date, the entire unvested portion of this     SAR shall continue to vest as set forth in the Notice of grant despite the     termination of Service;  

provided further, however, that Grantee is in full compliance with all the terms of this Agreement at the time of vesting.  The Committee, in its discretion, may accelerate the vesting of the balance, or some lesser portion of the balance, of the SARs at any time, subject to the terms of the Plan.  If so accelerated, such SARs will be considered as having vested as of the date specified by the Committee.
4.    Termination of SAR.  In the event of the Grantee’s termination of Continued Service for any reason other than Retirement, Disability or death, the Grantee may, within ninety (90) days after the date of such termination of Continued Service (excluding any period during which Grantee is prohibited from trading under the Company’s Insider Trading Policy), or prior to the Expiration Date, whichever shall first occur, exercise any vested but unexercised portion of this SAR.  In the event of the Grantee’s termination of Continued Service due to Disability or death, the Grantee may, within twelve (12) months after the date of such termination, or prior to the Expiration Date, whichever shall first occur, exercise any vested but unexercised portion of this SAR.  In the event of the Grantee’s termination of Continued Service due to Retirement, the Grantee may exercise any vested but unexercised portion of this SAR through the Expiration Date.  Any unvested portion of this SAR automatically will terminate and be forfeited (at no cost to the Company) on the first day on which it no longer is possible such portion to become vested.
5.    Death of Grantee.  In the event that the Grantee dies while in the employ of the Company and/or a parent of the Company or Subsidiary, the administrator or executor of the Grantee’s estate (or such other person to whom the SAR is transferred pursuant to the Grantee’s will or in accordance with the laws of descent and distribution), may exercise any vested but unexercised portion of the SAR in accordance with Paragraph 4 above.  Any such transferee must furnish the Company (a) written notice of his or her status as a transferee, (b) evidence satisfactory to the Company to establish the validity of the transfer of this SAR and compliance with any laws or regulations pertaining to such transfer, and (c) written acceptance of the terms and conditions of this SAR as set forth in this Agreement.
6.    Persons Eligible to Exercise SAR.  Except as provided in Paragraph 5 above or as otherwise determined by the Committee in its discretion, this SAR shall be exercisable during the Grantee’s lifetime only by the Grantee.

7.    SAR is Not Transferable.  Except to the limited extent provided in Paragraph 5 above, this grant and the rights and privileges conferred hereby shall not be transferred, assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) and shall not be subject to sale under execution, attachment or similar process.  Upon any attempt to transfer, assign, pledge, hypothecate or otherwise dispose of this grant, or of any right or privilege conferred hereby, or upon any attempted sale under any execution, attachment or similar process, this grant and the rights and privileges conferred hereby immediately shall become null and void.  Notwithstanding the preceding, the Grantee may transfer (not for consideration and for bona fide estate planning purposes) the Stock Appreciation Rights awarded under this Agreement to a revocable estate planning trust that is established solely for the benefit of Grantee and his or her immediate family.  Any such transfer will be permitted only if it is in compliance with such rules and procedures as the Company may establish from time to time. Among other things, Grantee must acknowledge and agree that (a) for U.S. income tax purposes, all taxable income from the Stock Appreciation Rights will be reported to Grantee alone, (b) if Grantee proposes to change the nature or character of the transferee trust, Grantee first must inform the Company and the Company may require that the Stock Appreciation Rights be transferred back to Grantee alone, and (c) no additional other or further transfers of the Stock Appreciation Rights will be permitted under any circumstance.
8.    Exercise of SAR.  This SAR may be exercised by the person then entitled to do so as to any Shares, and such exercise must be in accordance with the Company’s published exercise procedures, as in effect from time to time, which may require the Grantee to exercise this SAR through the Company’s designated broker or administrator. All exercises must be accompanied by payment of the aggregate exercise price together with all taxes the Company determines are required to be withheld by reason of the exercise of this SAR or as are otherwise required under Paragraph 10 below.  Exercise forms are available from the Stock Plan Administration.  Payment of the aggregate exercise price must be (i) in cash (including check, bank draft or money order), or (ii) for “cashless exercises” during the open trading window, by delivery of such documentation as the Company and any broker of deposit, if applicable, shall require to effect an exercise of the SAR and delivery to the Company of the sale or loan proceeds required to pay the exercise price, in each case plus any applicable withholding taxes.
9.    Payment of SAR Amount.  Upon exercise of this SAR, the Grantee shall be entitled to receive the number of Shares (the “SAR Amount”), less applicable withholdings, determined by (i) multiplying (a) the difference between the Fair Market Value of a Share over the Exercise Price; times (b) the number of Shares with respect to which this SAR is exercised, and (ii) dividing the product of (a) and (b) by the Fair Market Value of a Share.  The SAR Amount shall be paid solely in whole Shares; any fractional amount shall be rounded down to the nearest whole share.  Shares issued pursuant to the exercise of this SAR may be delivered in the form and manner determined by the Company, including, without limitation, in book form or listed in street name with a brokerage company of the Company’s choice.  For purposes of this Paragraph 9, Fair Market Value has the same meaning as in the Plan or as otherwise determined by the Company or its delegate. 
10.    Tax Withholding and Payment Obligations.  When the Shares are issued as payment for exercised SARs, the Grantee will recognize immediate U.S. taxable income if the Grantee is a U.S. taxpayer.  If the Grantee is a non-U.S. taxpayer, the Grantee will be subject to applicable taxes in his or her jurisdiction.  The Company (or the employing parent of the Company or Subsidiary) will withhold a portion of the Shares otherwise issuable in payment for exercised SARs that have an aggregate market value sufficient to pay the minimum federal, state and local income, employment and any other applicable taxes required to be withheld by the Company (or the employing parent of the Company or Subsidiary) with respect to the Shares.  No fractional Shares will be withheld or issued pursuant to the exercise of SARs and the issuance of Shares thereunder.  The Company (or the employing parent of the Company or Subsidiary) may instead, in its discretion, withhold an amount necessary to pay the applicable taxes from the Grantee’s paycheck, with no withholding of Shares.  In the event the withholding requirements are not satisfied through the withholding of Shares (or, through the Grantee’s paycheck, as indicated above), no payment will be made to the Grantee (or his or her estate) for SARs unless and until satisfactory arrangements (as determined by the Committee) have been made by the Grantee with respect to the payment of any income and other taxes which the Company determines must be withheld or collected with respect to such SARs.  By accepting this award of SARs, the Grantee expressly consents to the withholding of Shares and to any cash or Share withholding as provided for in this Paragraph 10.  All income and other taxes related to the SAR award and any Shares delivered in payment thereof are the sole responsibility of the Grantee.  In no event will the Company reimburse the Grantee for any taxes that may be imposed on the Grantee as result of Section 409A.
11.    Suspension of Exercisability.  If at any time the Company shall determine, in its discretion, that the listing, registration or qualification of the SARs upon any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory authority, is necessary or desirable as a condition of the exercise of SARs hereunder, this SAR may not be exercised, in whole or in part, unless and until such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Company.  The Company shall make reasonable efforts to meet the requirements of any such state or federal law or securities exchange and to obtain any such consent or approval of any such governmental authority.
12.    No Rights of Stockholder.  Neither the Grantee (nor any transferee) shall be or have any of the rights or privileges of a stockholder of the Company in respect of any of the Shares covered by this SAR.
13.    Successors and Assigns.  The Company may assign any of its rights under the Agreement to single or multiple assignees, and this Agreement shall inure to the benefit of the successors and assigns of the Company.  The rights and obligations of the Grantee under this Agreement may be assigned only with the prior written consent of the Company.
14.    No Effect on Employment.  The Grantee’s employment with the Company and any parent of the Company or Subsidiary is on an at-will basis only, subject to the provisions of applicable law.  Accordingly, subject to any written, express employment contract with the Grantee, nothing in this Agreement or the Plan shall confer upon the Grantee any right to continue to be employed by the Company or any parent of the Company or Subsidiary or shall interfere with or restrict in any way the rights of the Company or the employing parent of the Company or Subsidiary, which are hereby expressly reserved, to terminate the employment of the Grantee at any time for any reason whatsoever, with or without good cause.  Such reservation of rights can be modified only in an express written contract executed by a duly authorized officer of the Company or the parent of the Company or Subsidiary employing the Grantee.
15.    Address for Notices.  Any notice to be given to the Company under the terms of this Agreement shall be addressed to the Company, in care of its Secretary at the Company’s headquarters, P.O. Box 10212, 56 Top Gallant Road, Stamford, CT 06902-7700, or at such other address as the Company may hereafter designate in writing.
16.    Maximum Term of SAR.  Notwithstanding any other provision of this Agreement, this SAR is not exercisable after the Expiration Date.
17.    Non-Competition.  (a)(i) “Competitive Acts” shall mean: (A) the development, production, marketing or selling of (or assisting others to develop, produce, market or sell): (x) syndicated research that competes with the Company or its subsidiaries; or (y) a product or service which is competitive with the existing or planned products or services of the Company with which Grantee was involved in or managed at any time during the last twenty-four (24) months of the Employment; and (B) the direct or indirect provision of services to, or solicitation of, the Company’s clients or known prospects with whom Grantee had contact, managed, or became aware of as a result of being employed by the Company, for the purposes of developing, producing, marketing or selling such competitive products or services.

(ii)    Grantee understands and agrees that the Company’s business is global in nature and that its clients are located throughout the world; therefore, a territorial limitation on the non-competition covenants set forth in Paragraph 17 would not allow the Company to adequately protect its legitimate business interests, and the absence of such a limitation is entirely reasonable under these circumstances.  In addition, Grantee agrees that the provisions of this Paragraph 17 are reasonable to protect and preserve the Company’s legitimate business interests, including the protection of the Company’s Confidential Information and the Company’s substantial investment made to develop and retain its Confidential Information, client base, accounts and related goodwill.

(iii)    The Company may, in its sole discretion, waive any portion of the Grantee’s obligations contained in Paragraph 17.  No such waiver shall be valid unless directly provided to Grantee, in writing, by the Company’s General Counsel or his/her designee.

(b)    Grantee agrees that, for a period of two (2) years following the termination of his or her employment with the Company, for any reason whatsoever, the Grantee will not, on his or her own behalf or on behalf of any other person or entity (whether as a consultant, analyst, sales person, independent contractor, independent business venturer, partner, member, employee or otherwise), directly or indirectly: (i) engage in any Competitive Acts; and/or (ii) entice, encourage, cause or invite any of the Company’s clients, known prospects, and vendors to discontinue, diminish, or otherwise adversely modify the business done with the Company, or otherwise interfere with the relationship between the Company and its clients, known prospects, and vendors.

(c)    Grantee agrees that, in addition to any and all other remedies available to the Company (at law, in equity, or as otherwise set forth in this Agreement), the Company shall be entitled to liquidated damages for any violation of Paragraph 17 in an amount equal to: (i) the final twelve (12) months’ salary, commissions, and bonus paid to the Grantee; and (ii) an additional amount equal to the aggregate dollar value of shares underlying any stock appreciation rights, performance stock units, and/or restricted stock units that vested (or, in the case of stock appreciation rights, vested and Grantee exercised) at any time during the twelve (12) months prior to separating from the Company.  The dollar value of each such share shall be equal to the closing price of Gartner stock on the date of grant of the applicable stock appreciation right, performance stock unit or restricted stock unit.  Grantee agrees that the liquidated damages set forth herein are a reasonable approximation of the damages experienced by the Company for a violation of Paragraph 17, and are not to be deemed a penalty of any kind.

(d)    Grantee acknowledges that the time, geographic and scope limitations of the non-competition obligation set forth herein are fair and reasonable in all respects, and that Grantee will not be precluded from gainful employment if obligated to comply with the provisions hereof.  To the extent a court of appropriate jurisdiction finds the duration and/or geographic scope of the non-competition or non-solicitation restrictions to be unenforceable under applicable law, then it is the intention of the parties that such restriction be enforced to the fullest extent which the court deems reasonable.  In the event of Grantee’s breach or violation of this Paragraph 17, or good faith allegation by the Company of such breach or violation, the restricted periods set forth in this Paragraph 17 shall be tolled until such breach or violation, or allegation thereof, has been duly cured or resolved.  

(e)    During the restricted period set forth above, the Grantee will notify (in writing and not less than 72 hours in advance) the Company’s General Counsel if he or she intends to become an employee or other service provider of any entity other than the Company (for example, but not by way of limitation, as an employee, consultant, analyst, sales person, independent contractor, agent, independent business venturer, partner or member). 
18.    Non‐Solicitation and No‐Hire.  The Grantee further agrees that, for a period of two (2) years following the termination of his or her employment with the Company, for any reason whatsoever, the Grantee will not, directly or indirectly solicit, entice, or recruit employees of the Company to leave its employ, or offer or cause to be offered employment to any person who was employed by the Company at any time during the twelve (12) months prior to the termination of Grantee’s employment with the Company.  General mass solicitations of employment that are not directed at the Company or any employee(s) of the Company shall not be prohibited by this Paragraph 18.
19.    Binding Agreement.  Subject to the limitation on the transferability of this SAR contained herein, this Agreement shall be binding upon and inure to the benefit of the heirs, legatees, legal representatives, successors and assigns of the parties hereto.
20.    Governing Law.  This Agreement shall be construed in accordance with and governed by the laws of the State of Connecticut, other than its conflicts of laws provisions.
21.    Plan Governs.  This Agreement is subject to all of the terms and provisions of the Plan.  In the event of a conflict between one or more provisions of this Agreement and one or more provisions of the Plan, the provisions of the Plan shall govern.  Capitalized terms and phrases used and not defined in this Agreement shall have the meaning set forth in the Plan.
22.    Committee Authority.  The Committee shall have all discretion, power, and authority to interpret the Plan and this Agreement and to adopt such rules for the administration, interpretation and application of the Plan as are consistent therewith (including, but not limited to, the determination of whether or not any SARs have vested).  All actions taken and all interpretations and determinations made by the Committee in good faith shall be final and binding upon the Grantee, the Company and all other interested persons, and shall be given the maximum deference permitted by law.  No member of the Committee shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or this Agreement.
23.    Electronic Delivery and Acceptance.  The Company, in its sole discretion, may decide to deliver any documents related to Stock Appreciation Rights awarded under the Plan or future Stock Appreciation Rights that may be awarded under the Plan by electronic means.  The Grantee hereby consents to receive such documents by electronic delivery and agrees to participate in the Plan through any on‐line or electronic system established and maintained by the Company or another third party designated by the Company.
24.    Captions.  The captions provided herein are for convenience only and are not to serve as a basis for the interpretation or construction of this Agreement.
25.    Agreement Severable.  In the event that any provision in this Agreement shall be held invalid or unenforceable, such provision shall be severable from, and such invalidity or unenforceability shall not be construed to have any effect on, the remaining provisions of this Agreement.
26.    Modifications to the Agreement; Clawback.  This Agreement constitutes the entire understanding of the parties on the subjects covered.  The Grantee expressly warrants that he or she is not executing this Agreement in reliance on any promises, representations, or inducements other than those contained herein.  Except as otherwise provided herein, modifications to this Agreement or the Plan can be made only in an express written contract executed by a duly authorized officer of the Company.  Notwithstanding anything to the contrary in the Plan or this Agreement, the Company reserves the right to revise this Agreement as it deems necessary or advisable, in its sole discretion and without the consent of the Grantee, to avoid imposition of any additional tax or income recognition under Section 409A of the Internal Revenue Code of 1986, as amended (“Section 409A”), prior to the actual payment of Shares pursuant to this SAR, provided that such revision would not materially reduce the economic benefits provided or intended to be provided under this Agreement. In no event will the Company pay or reimburse the Grantee for any taxes or other costs imposed on account of Section 409A. Additionally, this Agreement and the award made hereunder shall be subject to any clawback policy which the Company may adopt from time to time as required by law or otherwise.
27.    Amendment, Suspension, Termination.  By accepting this SAR, the Grantee expressly warrants that he or she has received an SAR to purchase stock under the Plan, and has received, read and understood a description of the Plan.  The Grantee understands that the Plan is discretionary in nature and may be modified, suspended or terminated by the Company at any time.
28.    Defined Terms:  Capitalized terms used in this Agreement without definition will have the meanings provided for in the Plan.  When used in this Agreement, the following capitalized terms will have the following meanings:

“Continued Service” means that your employment relationship is not interrupted or terminated by you, the Company, or any parent or Subsidiary of the Company.  Your employment relationship will not be considered interrupted in the case of:  (i) any leave of absence approved in accordance with the Company’s written personnel policies, including sick leave, family leave, military leave, or any other personal leave; or (ii) transfers between locations of the Company or between the Company and any parent, Subsidiary or successor; provided, however, that, unless otherwise provided in the Company’s written personnel policies, in this Agreement or under applicable laws, rules or regulations, or unless the Committee has otherwise expressly provided for different treatment with respect to this Agreement, (x) no such leave may exceed ninety (90) days, and (y) any vesting shall cease on the ninety-first (91st) consecutive date of any leave of absence during which your employment relationship is deemed to continue and will not recommence until such date, if any, upon which you resume service with the Company, its parent, Subsidiary or successor.  If you resume such service in accordance with the terms of the Company’s military leave policy, upon resumption of service you will be given vesting credit for the full duration of your leave of absence.  Continuous employment will be deemed interrupted and terminated for an Employee if the Grantee’s weekly work hours change from full time to part time.  Part-time status for the purpose of vesting continuation will be determined in accordance with policies adopted by the Company from time to time, which policies, if any, shall supersede the determination of part-time status set forth in the Company’s posted “employee status definitions”.
“Disability” means total and permanent disability as defined in Section 22(e)(3) of the Code.
“Retirement” means termination of your employment in accordance with the Company’s retirement policies, as in effect from time to time, if on the date of such termination (i) you are at least 55 years old and your Continued Service has extended for at least five (5) years, and (ii) the number of full years in your age and your number of full years of Continued Service total at least 65.  By way of illustration, if you terminate your employment in accordance with the Company’s retirement policies on your 63rd birthday after six (6) years of Continued Service, your total would be 69 and your termination would be treated as a Retirement; if your Continued Service had extended for only four (4) years, your total would be 67 but your termination would not be treated as a Retirement since you would not have met the minimum of five (5) years of Continued Service.
Your acceptance of this grant indicates your agreement and understanding that this grant is subject to all of the terms and conditions contained in the Plan and this Agreement, which includes the notice of grant. Your acceptance of this grant indicates your agreement and understanding that this grant is subject to all of the terms and conditions contained in the Plan and this Award Agreement, which includes the notice of grant and this Agreement.

As a condition to receiving this Stock Appreciation Right grant and in consideration of such grant, you accept and agree to abide by the Agreement Regarding Certain Conditions of Employment provided to you in connection with such grant, including but not limited to the confidentiality and post-employment restrictions on competition set forth therein.  You hereby ratify, affirm and consent to those terms and conditions.   

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