Document:

EX-4.1

 

EXECUTION COPY

THIRD AMENDMENT

     THIRD AMENDMENT dated as of June 4, 2007 (this “Amendment”), among INTEGRA
LIFESCIENCES HOLDINGS CORPORATION, a Delaware corporation (the “Borrower”), the lenders
party to the Credit Agreement (as defined below) (collectively, the “Lenders”), BANK OF
AMERICA, N.A., as Administrative Agent, Swing Line Lender and L/C Issuer (the “Administrative
Agent”), CITIBANK, N.A., successor by merger to Citibank, FSB, as Syndication Agent (the
“Syndication Agent”), and JPMORGAN CHASE BANK, N.A., DEUTSCHE BANK TRUST COMPANY AMERICAS
and ROYAL BANK OF CANADA, as Co-Documentation Agents (the “Co-Documentation Agents”).

     PRELIMINARY STATEMENTS:

	 	(1)	 	The Borrower, the Existing Lenders, the Administrative Agent, the
Co-Syndication Agents and the Co-Documentation Agents have entered into a Credit
Agreement, dated as of December 22, 2005 (the “Original Agreement”), as amended
by that certain First Amendment, dated as of February 15, 2006 (the “First
Amendment”) and that certain Second Amendment, dated as of February 23, 2007 (the
“Second Amendment”). The Original Agreement, as amended by the First Amendment
and the Second Amendment, is referred to in this Amendment as the “Credit
Agreement”, and the Credit Agreement, as amended by, and together with this
Amendment, and as may be further amended, supplemented or otherwise modified from time
to time, is referred to herein as the “Amended Agreement”. Capitalized terms
used but not defined in this Amendment shall have the meanings assigned to them in the
Credit Agreement.
	 
	 	(2)	 	The Borrower has requested the Lenders amend the Credit Agreement as set forth
below.

     NOW, THEREFORE, in consideration of the premises and of the mutual covenants and agreements
contained herein, the parties hereto agree as follows:

     SECTION 1.01. Amendments to Section 1.01.

     (a) The definition of “Call Option” set forth in Section 1.01 of the Credit Agreement
is hereby deleted in its entirety and replaced with the following:

     “Call Option” means one or more call option transactions between
Borrower and one or more investment grade financial institution(s) giving Borrower
the right to receive upon exercise a number of its own issued and outstanding
capital stock and/or receive cash (in whole or in part) in an amount that is
intended to be substantially equivalent to the number of shares of capital stock
deliverable to holders of the related series of 2007 Convertible
Notes or value of such number of shares, as applicable, above the conversion price
pursuant to the terms of the 2007 Convertible Note Indenture.

 

 

     (b) The following proviso is hereby added to the end of the definition of “Consolidated
Funded Indebtedness” set forth in Section 1.01 of the Credit Agreement:

“provided; however, that for the purposes of Section 7.17(a)
and (b) only (i) until the maturity of the Convertible Notes, Consolidated
Funded Indebtedness shall be calculated net of up to $120 million of available,
unrestricted cash as set forth on the most recent balance sheet of the Borrower and
its Consolidated Subsidiaries delivered pursuant to Section 6.01(a) and
(b), and (ii) thereafter, Consolidated Funded Indebtedness shall be
calculated net of available, unrestricted cash as set forth on the most recent
balance sheet of the Borrower and its Consolidated Subsidiaries delivered pursuant
to Section 6.01(a) and (b) in excess of $40 million.”

     (b) The definition of “Consolidated Senior Leverage Ratio” set forth in Section 1.01 of
the Credit Agreement is hereby deleted in its entirety.

     (c) The definition of “Convertible Note Issue” set forth in Section 1.01 of the Credit
Agreement is hereby deleted in its entirety and replaced with the following:

“Convertible Note Issue” means an issuance of Indebtedness or Equity
Interests (other than the Convertible Notes) pursuant to Section 7.03(f),
(h), (k) or (l) that is convertible into Qualified Equity
Interests.

     (d) The definition of “Permitted Acquisitions” set forth in Section 1.01 of the Credit
Agreement is hereby amended by deleting clause (h)(2) in its entirety and replacing it with
the following:

     “(2) there will be Loans outstanding, the aggregate consideration (including cash and
non-cash consideration) for each Acquisition (or a series of related Acquisitions) is less
than or equal to (A) $200 million if the Borrower’s Consolidated Senior Secured Leverage
Ratio is less than 2.00 to 1.00 or (B) $100 million if the Borrower’s Consolidated Senior
Secured Leverage Ratio is greater than or equal to 2.00 to 1.00;”

     (e) The following definitions are hereby added to Section 1.01 of the Credit Agreement
in appropriate alphabetical order:

     “Consolidated Senior Secured Leverage Ratio” means, as of any date of
determination, the ratio of (a) Consolidated Funded Indebtedness less (i) the
outstanding principal amount of the Convertible Notes and all Indebtedness that is
expressly subordinated to such person’s indebtedness, obligations and liabilities to
the Lenders under the Loan Documents in form and substance reasonably acceptable to
the Administrative Agent as of such date and (ii) all senior unsecured Indebtedness
of the Borrower and its Consolidated Subsidiaries that is not subordinated to the
Obligations as of such date to (b) Consolidated EBITDA for the period of the four
consecutive fiscal quarters most recently ended.

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     “2007 3-Year Convertible Notes” means those 2007 Convertible Notes
maturing (or having their earliest optional call or put date of) approximately three
years from the date of issuance, and any securities issued in exchange therefore in
accordance with this Agreement; provided, that, in no event will the
principal amount of the 2007 3-Year Convertible Notes exceed $200 million.

     “2007 Convertible Note Indenture” means, collectively, one or more
Indentures to be entered into between the Borrower and a qualified trust company for
the issuance of the 2007 Convertible Notes.

     “2007 Convertible Notes” means those certain Convertible Senior
Unsecured Notes, which may be issued in one or more series, to be issued by the
Borrower on or before June 11, 2007 in the principal amount of up to $360 million,
pursuant to the 2007 Convertible Note Indenture, and any securities issued in
exchange therefore in accordance with this Agreement, and which are pari passu in
right of payment to the Obligations.

     “2007 3-Year Convertible Notes Maintenance Period” means the period
beginning on the date that is three months prior to the earlier of (i) the maturity
date and (ii) the first optional call or put date of the 2007 3-Year Convertible
Notes, in each case to and including the date the 2007 3-Year Convertible Notes are
repaid, redeemed or repurchased in full, as applicable.

     “Warrant Agreements” means one or more call option transactions entered
into in connection with the 2007 Convertible Notes between the Borrower and one or
more investment grade financial institutions pursuant to which Borrower is obligated
to deliver to any such financial institution upon exercise a number of shares of
Qualified Equity Interests of Borrower on a “net-share settlement” basis.

     SECTION 1.02. Amendments to Section 1.03. Section 1.03(c) of the Credit Agreement is
hereby deleted in its entirety and replaced with the following:

          “(c) Pro Forma Calculations. Notwithstanding anything herein to the contrary, any
calculation of the Consolidated Total Leverage Ratio, Consolidated Senior Secured Leverage Ratio,
Consolidated Fixed Charge Coverage Ratio and Pricing Ratio for any Reference Period during which a
Acquisition or Disposition shall have occurred shall each be made on a Pro Forma Basis for purposes
of making the following determinations:

     (i) determining the applicable pricing level under the definition of “Applicable Rate”;

     (ii) determining compliance with the Consolidated Total Leverage Ratio, Consolidated
Senior Secured Leverage Ratio and the Consolidated Fixed Charge Coverage Ratio (other than
whether the conditions precedent for a proposed transaction have been satisfied as
contemplated by subsection (iii) of this Section 1.03(c)); and

     (iii) determining whether the conditions precedent have been satisfied for a proposed
transaction which is permitted hereunder only so long as no Event of
Default will result from the consummation thereof, including, without limitation, any
Disposition or any Investment which results in an Acquisition.”

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     SECTION 1.03. Amendments to Section 7.03.

     (a) Section 7.03(h) of the Credit Agreement is hereby amended by deleting the amount
“$50 million” in the sixth line thereof and replacing it with “$25 million”.

     (b) Section 7.03 of the Credit Agreement is hereby amended by deleting the word “and”
from the end of Section 7.03(j) thereof.

     (c) Section 7.03(k) of the Credit Agreement is hereby deleted in its entirety and
replaced with the following:

“(k) Indebtedness representing a refinancing, refunding, renewal or extension of
Indebtedness (x) permitted by clause (b), (f) or (j) above or clause (l) below;
provided, that (i) the amount of such Indebtedness is not increased at the
time of such refinancing, refunding, renewal or extension, (ii) the terms relating
to principal amount, amortization, maturity, collateral (if any) and subordination
(if any), and other material terms taken as a whole, of any such refinancing,
refunding, renewing or extending Indebtedness, and of any agreement entered into and
of any instrument issued in connection therewith, are no less favorable in any
material respect to the Loan Parties or the Lenders than the terms of any agreement
or instrument governing the Indebtedness being refinanced, refunded, renewed or
extended and the interest rate applicable to any such refinancing, refunding,
renewing or extending Indebtedness does not exceed the then applicable market
interest rate, (iii) with respect to the Convertible Notes, the 2007 Convertible
Notes and any subordinated debt incurred pursuant to Section 7.03(f) or
(j), the maturity date is no earlier than three (3) months after the
Maturity Date, and (iv) with respect to any Indebtedness incurred pursuant to
Section 7.03(f) above as long as the conditions to the incurrence thereof as
set forth in clause (f) remain true and correct at the time of and after giving
effect to such refinancing, renewal or extension, and (y) permitted by clause (h)
above, as long as the conditions to the incurrence thereof remain true and correct
at the time of and after giving effect to such refinancing, renewal or extension;
and”

     (d) The following new section is hereby added at the end of Section 7.03 of the Credit
Agreement:

     “(l) Indebtedness arising under and evidenced by the 2007 Convertible Notes and the
2007 Convertible Note Indenture, each containing the terms set forth on the summary term
sheet attached hereto as Exhibit L.”

     SECTION 1.04. Amendments to Section 7.04. Section 7.04(a) of the Credit Agreement is
hereby amended by (a) deleting the word “and” from the end of subsection (vii) thereof, (b)
deleting the period from the end of subsection (viii) thereof and replacing it with a semicolon and
(c) adding the following new subsections immediately following subsection (viii):

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     “(ix) any Foreign Subsidiary may merge or consolidate into any other Foreign
Subsidiary; and

     (x) any Subsidiary of the Borrower may transfer a Foreign Subsidiary to any other
Subsidiary of the Borrower.”

     SECTION 1.05. Amendments to Section 7.06.

     (a) Section 7.06(c) of the Credit Agreement is hereby amended by (i) deleting the word
“repay” in the first line thereof and replacing it with the words “repurchase, redeem or
repay” and (ii) inserting the words “redemption, repurchase or” immediately after the word
“proposed” in the eighth line thereof.

     (b) Section 7.06(d) of the Credit Agreement is hereby deleted in its entirety and
replaced with the following:

     “(d) the Borrower may at any time, and from time to time after the Closing
Date, make Restricted Payments if, after giving effect to such Restricted Payment,
(x) there will be no Loans outstanding or (y) there will be Loans outstanding (i)
Restricted Payments that do not exceed $50 million in any fiscal year if, at the
time of such Restricted Payment, the Borrower’s Consolidated Senior Secured Leverage
Ratio is greater than or equal to 2.00 to 1.00 and (ii) Restricted Payments that do
not exceed $100 million in any fiscal year if, at the time of such Restricted
Payment, the Borrower’s Consolidated Senior Secured Leverage Ratio is less than 2.00
to 1.00; provided, that, it is understood (A) that this Section
7.06(d) does not apply to payments made in respect of the Convertible Notes or
the 2007 3-Year Convertible Notes, which are governed by the terms of Section
7.06(c) above and Section 7.06(k) below, respectively and (B) that the
Borrower may make Restricted Payments in the form of (1) the repurchase, redemption
or retirement of any outstanding Equity Interest of the Borrower with the proceeds
of subordinated indebtedness, the issuance of which is permitted pursuant to
Section 7.03(f), (2) the repurchase, redemption or retirement of any
outstanding Equity Interest of the Borrower with up to $125 million of the proceeds
of the 2007 Convertible Notes, (3) the withholding, repurchase, redemption or
retirement of any restricted Qualified Equity Interests issued to employees and
consultants of the Loan Parties, pursuant to the Borrower’s equity incentive plans
approved by the Borrower’s Board of Directors and withheld by the Borrower to
satisfy tax obligations of such employees and/or consultants at the time the
forfeiture and transferability restrictions cease, and (4) a purchase of a Call
Option in connection with the issuance of Indebtedness permitted pursuant to
Section 7.03(f), (h), (k) or (l), and in the case of
each of clauses (1), (2), (3) and (4) above, without regard to, and without
decreasing the availability of, the baskets set forth in clauses (y)(i) and (y)(ii)
above;”

     (c) Section 7.06(e) of the Credit Agreement is hereby deleted in its entirety and
replaced with the following:

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     “(e) the Borrower may issue or sell (x) Qualified Equity Interests so long as
such issuance or sale does not result in a Change of Control and (y) other Equity
Interests to the extent permitted by Section 7.03(f), (h), 
(k) or (l);”

     (d) Section 7.06(g) of the Credit Agreement is hereby deleted in its entirety and
replaced with the following:

     “(g) the Borrower may repurchase or refinance (x) its outstanding Equity
Interests out of the proceeds of a substantially concurrent issue of, or an exchange
for, Qualified Equity Interests and (y) Equity Interests or Indebtedness issued
pursuant to Section 7.03(f), (k) or (l) with the proceeds of
the issuance of Qualified Equity Interests or other Indebtedness permitted by
Section 7.03 (and which complies with the terms of Section
7.03(k));”

     (e) Section 7.06(i) of the Credit Agreement is hereby amended by deleting the word
“and” from the end thereof.

     (f) Section 7.06(j) of the Credit Agreement is hereby amended by deleting the period
from the end thereof and replacing it with a semicolon.

     (g) The following new sections are hereby added at the end of Section 7.06 of the
Credit Agreement:

     “(k) the Borrower may repurchase, redeem or repay the 2007 3-Year Convertible
Notes if either (i) after giving pro forma effect to the repayment of the 2007
3-Year Convertible Notes on a Pro Forma Basis, the Consolidated Total Leverage Ratio
is less than 3.50 to 1.00, or (ii) (A) in the event the 2007 3-Year Convertible
Notes remain outstanding on the first day of the 2007 3-Year Convertible Notes
Maintenance Period, then the Borrower maintains Liquidity of at least $40 million
plus the aggregate principal amount of the 2007 3-Year Convertible Notes issued by
the Borrower at all times during the 2007 3-Year Convertible Notes Maintenance
Period and (B) after giving effect to any proposed repurchase, redemption or
repayment of the 2007 3-Year Convertible Notes, irrespective of when paid, the
Borrower has Liquidity of at least $40 million; and

     (l) the Borrower may make cash payments in lieu of issuing fractional shares in
connection with a conversion of a Convertible Note Issue.”

     SECTION 1.06. Amendments to Section 7.07.

     (a) Section 7.07(a) of the Credit Agreement is hereby deleted in its entirety and
replaced with the following:

     “(a) After the issuance thereof, amend or modify (or permit the amendment or
modification of (including any waivers of)), the terms of the 2007 Convertible Notes
or any subordinated Indebtedness (including the Convertible Notes and any
Indebtedness issued pursuant to the terms of Section 7.03(f)) in a manner
adverse to the interests of the Lenders (including, without
limitation, specifically shortening any maturity or average life to maturity or requiring
any payment sooner than previously scheduled or increasing the interest rate or fees
applicable thereto or granting collateral as security therefor); provided,
however, the Convertible Notes may be amended to permit the Convertible Note
Exchange.”

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     (b) Section 7.07(e) of the Credit Agreement is hereby deleted in its entirety and
replaced with the following:

     “(e) Make any prepayment, redemption, defeasance or acquisition for
value (including, without limitation, by way of depositing money or
securities with the trustee with respect thereto before due for the purpose
of paying when due), or refund, refinance or exchange of any Indebtedness
permitted under Sections 7.03(b), 7.03(f), 7.03(j)
and 7.03(l) (including any Indebtedness incurred in connection with
a refinancing thereof pursuant to Section 7.03(k)) other than
regularly scheduled payments of principal and interest on such Indebtedness,
refinancings thereof permitted pursuant to Section 7.03(k) and
prepayments of such Indebtedness with the proceeds of a substantially
concurrent issuance of Qualified Equity Interests; provided,
that, the Borrower may (x) repay the Convertible Notes on the terms
set forth in Section 7.06(c) and may exchange the Convertible Notes
in the Convertible Note Exchange, (y) repay the 2007 3-Year Convertible
Notes on the terms set forth in Section 7.06(k) and (z) make
Restricted Payments permitted by Section 7.06.”

     SECTION 1.07. Amendments to Section 7.17.

     (a) Section 7.17(b) of the Credit Agreement is hereby deleted in its entirety and
replaced with the following:

     “(b) Maximum Consolidated Senior Secured Leverage Ratio. Permit the
Consolidated Senior Secured Leverage Ratio of the Borrower and its Consolidated
Subsidiaries at any time during any period of four consecutive fiscal quarters to be
greater than 2.50 to 1.0.”

     (b) Section 7.17(d) of the Credit Agreement is hereby deleted in its entirety and
replaced with the following:

     “(d) Liquidity. (i) During the RLL Maintenance Period and
until such time as the Convertible Notes have been repaid or refinanced as
permitted in this Agreement, permit the Liquidity of the Borrower and its
Consolidated Subsidiaries to be less than $160 million and (ii) during the
2007 3-Year Convertible Notes Maintenance Period and until such time as the
2007 3-Year Convertible Notes have been repaid or refinanced as permitted in
this Agreement, permit the Liquidity of the Borrower and its Consolidated
Subsidiaries to be less than $40 million plus the aggregate principal amount of the 2007 3-Year Convertible Notes issued by the
Borrower.”

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     SECTION 1.08. Amendment to Section 10.06. Section 10.06(b)(iv) of the Credit
Agreement is hereby amended by deleting the words “, if any, required as set forth on Schedule
10.06,” and replacing it with “of $3,500; provided, however, that the
Administrative Agent may, in its sole discretion, elect to waive such processing and recordation
fee in the case of any assignment,”.

     SECTION 1.09. Amendment to Article X. A new Section 10.18 is hereby added immediately
following Section 10.17 as follows:

“Section 10.18.
No Advisory or Fiduciary Responsibility. In connection with all aspects
of each transaction contemplated hereby (including in connection with any amendment, waiver or
other modification hereof or of any other Loan Document), the Borrower acknowledges and agrees,
and acknowledges its Affiliates’ understanding, that: (i) (A) the arranging and other services
regarding this Agreement provided by the Administrative Agent and the Arranger, are arm’s-length
commercial transactions between the Borrower and its Affiliates, on the one hand, and the
Administrative Agent and the Arranger, on the other hand, (B) the Borrower has consulted its own
legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (C) the
Borrower is capable of evaluating, and understands and accepts, the terms, risks and conditions of
the transactions contemplated hereby and by the other Loan Documents; (ii) (A) the Administrative
Agent and the Arranger each is and has been acting solely as a principal and, except as expressly
agreed in writing by the relevant parties, has not been, is not, and will not be acting as an
advisor, agent or fiduciary for the Borrower or any of its Affiliates, or any other Person and (B)
neither the Administrative Agent nor the Arranger has any obligation to the Borrower or any of its
Affiliates with respect to the transactions contemplated hereby except those obligations expressly
set forth herein and in the other Loan Documents; and (iii) the Administrative Agent and the
Arranger and their respective Affiliates may be engaged in a broad range of transactions that
involve interests that differ from those of the Borrower and its Affiliates, and neither the
Administrative Agent nor the Arranger has any obligation to disclose any of such interests to the
Borrower or its Affiliates. To the fullest extent permitted by law, the Borrower hereby waives and
releases any claims that it may have against the Administrative Agent and the Arranger with
respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect
of any transaction contemplated hereby.”

     SECTION 1.10. Amendments to Schedules and Exhibits. (a) Schedule 10.06 to the Credit
Agreement is hereby deleted in its entirety.

     (b) Exhibit L attached hereto is hereby added to the Credit Agreement as Exhibit L.

     SECTION 1.11. 2007 Convertible Note Transaction.

     (a) Notwithstanding anything in the Amended Agreement or the other Loan Documents to
the contrary, the transactions contemplated by the Call Options, the Warrants and the 2007
Convertible Notes, each as entered into on a substantially concurrent basis, and the performance by the Borrower of its obligations under any such
Call Options, Warrants or 2007 Convertible Notes (including, without limitation, any
obligation of Borrower pursuant to any conversion, exercise, or termination of, or any
payment or delivery pursuant to the terms of such Call Options, Warrants or 2007 Convertible
Notes) shall be permitted; provided, however, that any payments in cash
(other than interest, customary liquidated damages and customary additional amounts payable
under the 2007 Convertible Note Indenture or any registration rights agreement relating to
the 2007 Convertible Notes that do not constitute principal, net share settlement payments
or other similar amounts) by Borrower shall be permitted only to the extent that (i) no
Event of Default has occurred and is continuing or would result therefrom and (ii) either
(x) after giving pro forma effect to any such cash payment, the Consolidated Total Leverage
Ratio is less than 3.50 to 1.00 or (y) after giving effect to such cash payment, the
Borrower has Liquidity of at least $40 million; and provided, further, that
any payment or delivery obligations of the Borrower to the applicable financial institution
pursuant to the terms of any Warrant(s) may be netted against the substantially concurrent
payment or delivery obligations deliverable to the Borrower from such financial institution
pursuant to the terms of any Call Option(s); provided, further,
that, any cash payment of a net share settlement to any holder of the 2007
Convertible Notes in excess of the face amount of the applicable note is only permitted to
the extent that a Restricted Payment would be permitted pursuant to Section 7.06(d)(x) or
(y) of the Amended Agreement.

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     (b) In furtherance and not in limitation of the foregoing, and notwithstanding any
provisions of the Amended Agreement and the Collateral Documents to the contrary, for the
purpose of permitting the Borrower to execute and deliver, and exercise its rights and
perform its obligations under, the Call Options and the Warrants without any lien or
encumbrance of the Lenders, under the Security Agreement or otherwise, attaching to the
rights of the Borrower under the Call Options or the Warrants, the Required Lenders hereby
(i) release any and all such liens and encumbrances that may arise in respect of the
Borrower’s rights under such documents pursuant to the Loan Documents, (ii) waive (1) the
requirements under Section 6.12 of the Amended Agreement and comparable provisions of the
other Loan Documents for the Borrower otherwise to pledge its rights under the Call Options
and the Warrants and (2) the limitations on restricted actions contained in Section 7.10 of
the Amended Agreement and (iii) agree that the entry into and performance by the Borrower of
the Call Option and Warrant transactions in accordance with their terms and the terms of
this Amendment will not conflict with the terms or violate the provisions of the Loan
Documents.

     SECTION 1.12. Representations and Warranties. The Borrower hereby represents and
warrants to the Administrative Agent and the Lenders, as follows:

     (a) The representations and warranties set forth in Article V of the Credit Agreement
and in each other Loan Document are true and correct in all material respects on and as of
the date hereof and on and as of the Third Amendment Effective Date (as defined below) with
the same effect as though made on and as of the date hereof or the Third Amendment Effective
Date, as the case may be, except to the extent such representations and warranties expressly
relate to an earlier date (in which case such representations and warranties shall be true and correct in all material respects on
and as of such earlier date), except that for purposes of this Amendment, the
representations and warranties contained in subsections (a) and (b) of Section 5.05 of the
Credit Agreement shall be deemed to refer to the most recent statements furnished pursuant
to subsections (a) and (b), respectively, of Section 6.01 of the Credit Agreement, including
the statements in connection with which this Amendment is delivered.

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     (b) On the date hereof and on the Third Amendment Effective Date, no Default or Event
of Default has occurred and is continuing.

     (c) The execution, delivery and performance of this Amendment by the Borrower have been
duly authorized by all requisite corporate or other organizational action.

     (d) This Amendment constitutes the legal, valid and binding obligation of the Borrower
enforceable against the Borrower in accordance with its terms.

     (e) The execution, delivery and performance of this Amendment by the Borrower do not
and will not (i) contravene the terms of any of the Borrower’s Organization Documents; (ii)
conflict with or result in any breach or contravention of, or (except for the Liens created
under the Loan Documents) the creation of any Lien under, or require any payment to be made
under (A) any Contractual Obligation to which the Borrower or the Borrower’s Affiliate is a
party or affecting the Borrower or the properties of the Borrower or any of its subsidiaries
or (B) any order, injunction, writ or decree of any Governmental Authority or any arbitral
award to which the Borrower or its property is subject; or (iii) violate any Law.

     SECTION 1.13. Effectiveness. This Amendment shall become effective only upon
satisfaction of the following conditions precedent (the first date upon which each such condition
has been satisfied being herein called the “Third Amendment Effective Date”):

     (a) The Administrative Agent shall have received duly executed counterparts of (i) this
Amendment which, when taken together, bear the authorized signatures of the Borrower and the
Required Lenders and (ii) the Reaffirmation of Guaranty which, when taken together, bear the
authorized signatures of each Subsidiary Guarantor and the Administrative Agent.

     (b) The representations and warranties set forth in Section 1.12 hereof shall
be true and correct on and as of the Third Amendment Effective Date.

     (c) The Administrative Agent shall have received all fees and expenses required to be
paid by the Borrower pursuant to Section 1.15 of this Amendment.

     (d) The Lenders shall have received such other documents, legal opinions, instruments
and certificates as they shall reasonably request and such other documents, legal opinions,
instruments and certificates shall be satisfactory in form and substance to the Lenders and
their counsel. All corporate and other proceedings taken or to be taken in connection with
this Amendment and all documents incidental thereto, whether or not referred to herein, shall be satisfactory in form and substance to the Lenders and
their counsel.

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     SECTION 1.14. APPLICABLE LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK WITHOUT REFERENCE TO THE CONFLICTS OF LAWS
PRINCIPLES THEREOF.

     SECTION 1.15. Fees and Expenses. The Borrower shall pay all reasonable out-of-pocket
expenses incurred by the Administrative Agent in connection with the preparation, negotiation,
execution, delivery and enforcement of this Amendment, including, but not limited to, the
reasonable fees and disbursements of counsel.

     SECTION 1.16. Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall constitute an original but all of which when taken together shall
constitute but one agreement. Delivery by facsimile by any of the parities hereto of an executed
counterpart of this Amendment shall be as effective as an original executed counterpart hereof and
shall be deemed a representation that an original executed counterpart hereof will be delivered,
but the failure to deliver a manually executed counterpart shall not affect the validity,
enforceability or binding effect of this Amendment.

     SECTION 1.17. Credit Agreement. Except as expressly set forth herein, the amendments
provided herein shall not by implication or otherwise limit, constitute a waiver of, or otherwise
affect the rights and remedies of the Lenders or the Administrative Agent under the Credit
Agreement or any other Loan Document, nor shall they constitute a waiver of any Default or Event of
Default, nor shall they alter, modify, amend or in any way affect any of the terms, conditions,
obligations, covenants or agreements contained in the Credit Agreement or any other Loan Document.
Each of the amendments provided herein shall apply and be effective only with respect to the
provisions of the Credit Agreement specifically referred to by such amendment. Except as expressly
amended herein, the Credit Agreement shall continue in full force and effect in accordance with the
provisions thereof. As used in the Credit Agreement, the terms “Agreement”, “herein”,
“hereinafter”, “hereunder”, “hereto” and words of similar import shall include, from and after the
Third Amendment Effective Date, the Amended Agreement.

[Remainder of page intentionally left blank]

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     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their
duly authorized officers, all as of the date first above written.

	 	 	 	 	 
	 	Borrower:

INTEGRA LIFESCIENCES HOLDINGS

CORPORATION, a Delaware corporation

 	 
	 	By:  	/s/ Maureen Bellantoni
 	 
	 	 	Name:  	Maureen B. Bellantoni 	 
	 	 	Title:  	Executive Vice President and

Chief Financial Officer 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	BANK OF AMERICA, N.A., as Administrative

Agent

 	 
	 	By:  	/s/ Amie L. Edwards
 	 
	 	 	Name:  	Amie L. Edwards 	 
	 	 	Title:  	Vice President 	 
	 

	 	 	 	 	 
	 	BANK OF AMERICA, N.A., as Swing Line Lender, L/C

Issuer and as a Lender

 	 
	 	By:  	/s/ Amie L. Edwards
 	 
	 	 	Name:  	Amie L. Edwards 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	CITIBANK, N.A., successor by merger to

Citibank, FSB, as Syndication Agent and as a

Lender

 	 
	 	By:  	/s/ Christopher D. Pannacciulli
 	 
	 	 	Name:  	Christopher D. Pannacciulli 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	ROYAL BANK OF CANADA, as Co-

Documentation Agent and as a Lender

 	 
	 	By:  	/s/ Gordon C. MacArthur
 	 
	 	 	Name:  	Gordon C. MacArthur 	 
	 	 	Title:  	Authorized Signatory 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	JP MORGAN CHASE BANK, N.A., as Co-

Documentation Agent and as a Lender

 	 
	 	By:  	/s/ Dawn B. Scocco
 	 
	 	 	Name:  	Dawn B. Scocco 	 
	 	 	Title:  	Associate 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	DEUTSCHE BANK TRUST COMPANY

AMERICAS., as Co-Documentation Agent and as a Lender

 	 
	 	By:  	/s/ Carin Keegan
 	 
	 	 	Name:  	Carin Keegan 	 
	 	 	Title:  	Vice President 	 
	 

	 	 	 	 	 
	 	 	 
	 	By:  	                                              /s/ Scottye Lindsey
 	 
	 	 	Name:  	Scottye Lindsey 	 
	 	 	Title:  	Director 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	WACHOVIA BANK, NATIONAL

ASSOCIATION, as a Lender

 	 
	 	By:  	/s/ Kirk Tesch
 	 
	 	 	Name:  	Kirk Tesch 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	CITIZENS BANK PA, as a Lender

 	 
	 	By:  	/s/ Mark W. Torie
 	 
	 	 	Name:  	Mark W. Torie 	 
	 	 	Title:  	Senior Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	HSBC BANK USA, NATIONAL

ASSOCIATION, as a Lender

 	 
	 	By:  	/s/ Jeffrey Wieser
 	 
	 	 	Name:  	Jeffrey Wieser 	 
	 	 	Title:  	Managing Director 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	COMMERCE BANK, N.A., as a Lender

 	 
	 	By:  	/s/ Daniel R. Vereb
 	 
	 	 	Name:  	Daniel R. Vereb 	 
	 	 	Title:  	Vice President 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	BROWN BROTHERS HARRIMAN & CO, as a Lender

 	 
	 	By:  	/s/ J. Edward Hall
 	 
	 	 	Name:  	J. Edward Hall 	 
	 	 	Title:  	Managing Director 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	CIBC INC., as a Lender

 	 
	 	By:  	/s/ Caroline Adams
 	 
	 	 	Name:  	Caroline Adams 	 
	 	 	Title:  	Authorized Signatory 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	GOLDMAN SACHS CREDIT PARTNERS L.P., as a Lender

 	 
	 	By:  	/s/ James V. Balcom
 	 
	 	 	Name:  	James B. Balcom 	 
	 	 	Title:  	Authorized Signatory 	 

 

 

	 	 	 	 	 

EXHIBIT L

Convertible Notes Preliminary Term Sheet

	 	 	 
	Issuer:

	 	Integra LifeSciences Holdings (the “Company”)
	 
	 	 
	Issuance type:

	 	Senior Unsecured Convertible Notes

	 	 	 	 	 
	 	 	Tranche A	 	Tranche B
	Size:

	 	$125MM plus $25 MM greenshoe
	 	$125MM plus $25 MM greenshoe
	Maturity:

	 	3 years
	 	5 years
	Indicative Coupon:

	 	2.75% — 3.25%
	 	2.125% — 2.625%
	Indicative Premium:

	 	27.5% — 32.5%
	 	22.5% — 27.5%
	Call Feature:

	 	NC-Life
	 	NC-Life
	Put Feature:

	 	See Fundamental Change below
	 	See Fundamental Change below

	 	 	 
	Guarantee:

	 	Integra LifeSciences Corporation will guarantee
the obligations of the Company under the Notes
	 
	 	 
	Use of proceeds:

	 	Repurchase shares of common stock concurrent
with offering, enter into bond hedge and
warrant transactions, refinance outstanding
indebtedness, general corporate purposes
	 
	 	 
	Payment period:

	 	Semi-annually on [June 1] and [December 1],
beginning on [December 1]
	 
	 	 
	Rank:

	 	Senior Unsecured
	 
	 	 
	Anti-Dilution:

	 	Conversion rate adjustment upon, among other
things, certain distributions and dividends to
common stockholders
	 
	 	 
	Fundamental Change:

	 	Par put option upon certain change of control
events, including a majority ownership position
by an individual or group, lack of continuing
directors on the board, certain sales of all or
substantially all assets, and a termination of
trading
	 
	 	 
	Events of Default:

	 	Failure to pay principal, interest or
conversion value of the notes; failure to
provide notice of fundamental change; failure
to observe certain other indenture covenants or
warranties for 60 days after notice by trustee
or holders; failure to make payment on other
indebtedness; and certain events of bankruptcy,

 

 

	 	 	 
	 

	 	insolvency or reorganization
	 
	 	 
	Conversion Rights:

	 	Holders have the ability to convert the bonds
if the stock price reaches a specified premium
to the conversion price, if the bonds trade at
a discount to the value of the underlying
shares, at anytime [3 months] prior to maturity
and upon certain corporate transactions
	 
	 	 
	Conversion Settlement:

	 	Upon conversion, the Company may deliver cash
and shares or shares; per NASDAQ limitations,
in no circumstance will the Company deliver
shares in excess of 20% of shares outstanding
without prior shareholder approval

Terms above are subject to change based on final pricing terms. This summary highlights
selected information and does not contain all of the information you need to consider, which will
be included in the indenture and corresponding description of notes.EX-10.1

 

GARTNER, INC.

EXECUTIVE PERFORMANCE BONUS PLAN

(Effective January 1, 2008)

-i-

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 
	 	 	Page
	SECTION 1 BACKGROUND, PURPOSE AND DURATION
	 	 	1	 
	 
	 	 	 	 
	1.1 Effective Date
	 	 	1	 
	1.2 Purpose of the Plan
	 	 	1	 
	 
	 	 	 	 
	SECTION 2 DEFINITIONS
	 	 	1	 
	 
	 	 	 	 
	2.1 “Actual Award”
	 	 	1	 
	2.2 “Affiliate”
	 	 	1	 
	2.3 “Base Salary”
	 	 	1	 
	2.4 “Board”
	 	 	1	 
	2.5 “Cash Flow”
	 	 	1	 
	2.6 “Code”
	 	 	1	 
	2.7 “Committee”
	 	 	2	 
	2.8 “Company”
	 	 	2	 
	2.9 “Contract Value”
	 	 	2	 
	2.10 “Customer Efficiency”
	 	 	2	 
	2.11 “Determination Date”
	 	 	2	 
	2.12 “Disability”
	 	 	2	 
	2.13 “Earnings Per Share”
	 	 	2	 
	2.14 “Employee”
	 	 	2	 
	2.15 “Financial Efficiency”
	 	 	2	 
	2.16 “Fiscal Year”
	 	 	2	 
	2.17 “Maximum Award”
	 	 	2	 
	2.18 “Participant”
	 	 	2	 
	2.19 “Payout Formula”
	 	 	3	 
	2.20 “Performance Period”
	 	 	3	 
	2.21 “Performance Goals”
	 	 	3	 
	2.22 “Plan”
	 	 	3	 
	2.23 “Profit”
	 	 	3	 
	2.24 “Retirement”
	 	 	3	 
	2.25 “Revenue”
	 	 	3	 
	2.26 “SG&A”
	 	 	3	 
	2.27 “Target Award”
	 	 	4	 
	2.28 “Termination of Employment”
	 	 	4	 
	2.29 “Total Stockholder Return”
	 	 	4	 
	 
	 	 	 	 
	SECTION 3 SELECTION OF PARTICIPANTS AND DETERMINATION OF AWARDS
	 	 	4	 
	 
	 	 	 	 
	3.1 Selection of Participants
	 	 	4	 
	3.2 Determination of Performance Goals
	 	 	4	 

-ii-

 

TABLE OF CONTENTS

(continued)

	 	 	 	 	 
	 	 	Page
	3.3 Determination of Target Awards
	 	 	4	 
	3.4 Determination of Payout Formula or Formulae
	 	 	4	 
	3.5 Date for Determinations
	 	 	5	 
	3.6 Determination of Actual Awards
	 	 	5	 
	 
	 	 	 	 
	SECTION 4 PAYMENT OF AWARDS
	 	 	5	 
	 
	 	 	 	 
	4.1 Right to Receive Payment
	 	 	5	 
	4.2 Timing of Payment
	 	 	5	 
	4.3 Form of Payment
	 	 	5	 
	4.4 Termination of Employment
	 	 	5	 
	 
	 	 	 	 
	SECTION 5 ADMINISTRATION
	 	 	5	 
	 
	 	 	 	 
	5.1 Committee is the Administrator
	 	 	5	 
	5.2 Committee Authority
	 	 	6	 
	5.3 Decisions Binding
	 	 	6	 
	5.4 Delegation by the Committee
	 	 	6	 
	 
	 	 	 	 
	SECTION 6 GENERAL PROVISIONS
	 	 	6	 
	 
	 	 	 	 
	6.1 Tax Withholding
	 	 	6	 
	6.2 No Effect on Employment
	 	 	6	 
	6.3 Participation
	 	 	6	 
	6.4 Indemnification
	 	 	7	 
	6.5 Successors
	 	 	7	 
	6.6 Beneficiary Designations
	 	 	7	 
	6.7 Nontransferability of Awards
	 	 	8	 
	6.8 Deferrals
	 	 	8	 
	 
	 	 	 	 
	SECTION 7 AMENDMENT, TERMINATION AND DURATION
	 	 	8	 
	 
	 	 	 	 
	7.1 Amendment, Suspension or Termination
	 	 	8	 
	7.2 Duration of the Plan
	 	 	8	 
	 
	 	 	 	 
	SECTION 8 LEGAL CONSTRUCTION
	 	 	8	 
	 
	 	 	 	 
	8.1 Gender and Number
	 	 	8	 
	8.2 Severability
	 	 	8	 
	8.3 Requirements of Law
	 	 	8	 
	8.4 Governing Law
	 	 	8	 
	8.5 Captions
	 	 	8	 

-iii-

 

GARTNER, INC.

EXECUTIVE PERFORMANCE BONUS PLAN

SECTION 1

BACKGROUND, PURPOSE AND DURATION

     1.1 Effective Date. The Plan is effective as of January 1, 2008, subject to
ratification by an affirmative vote of the holders of a majority of the Shares that are present in
person or by proxy and entitled to vote at the 2007 Annual Meeting of Stockholders of the Company.

     1.2 Purpose of the Plan. The Plan is intended to increase stockholder value and the
success of the Company by motivating Participants (1) to perform to the best of their abilities,
and (2) to achieve the Company’s objectives. The Plan’s goals are to be achieved by providing
Participants with the opportunity to earn incentive awards for the achievement of goals relating to
the performance of the Company. The Plan is intended to permit the payment of bonuses that qualify
as performance-based compensation under Section 162(m) of the Code.

SECTION 2

DEFINITIONS

     The following words and phrases shall have the following meanings unless a different meaning
is plainly required by the context:

     2.1 “Actual Award” means as to any Performance Period, the actual award (if any)
payable to a Participant for the Performance Period. Each Actual Award is determined by the Payout
Formula for the Performance Period, subject to the Committee’s authority under Section 3.6 to
eliminate or reduce the award otherwise determined by the Payout Formula.

     2.2 “Affiliate” means any corporation or other entity (including, but not limited to,
partnerships and joint ventures) controlled by the Company.

     2.3 “Base Salary” means as to any Performance Period, the Participant’s earned salary
during the Performance Period. Such Base Salary shall be before both (a) deductions for taxes or
benefits, and (b) deferrals of compensation pursuant to Company-sponsored plans and
Affiliate-sponsored plans.

     2.4 “Board” means the Board of Directors of the Company.

     2.5 “Cash Flow” means as to any Performance Period, cash generated from operating
activities, free cash flow or total cash flow and includes cash flow return on investment
(calculated by dividing any of the foregoing measures of Cash Flow by total capital).

     2.6 “Code” means the Internal Revenue Code of 1986, as amended. Reference to a
specific section of the Code or regulation thereunder shall include such section or regulation, any

 

 

valid regulation promulgated thereunder, and any comparable provision of any future legislation or
regulation amending, supplementing or superseding such section or regulation.

     2.7 “Committee” means the committee appointed by the Board (pursuant to Section 5.1)
to administer the Plan.

     2.8 “Company” means Gartner, Inc., a Delaware corporation, or any successor thereto.

     2.9 “Contract Value” means as to any Performance Period, the value attributable to
all subscription-related research products that recognize revenue on a ratable basis. Contract
value is calculated as the annualized value of all subscription research contracts in effect at a
specific point in time, without regard to the duration of the contract.

     2.10 “Customer Efficiency” means as to any Performance Period, a performance
measurement related to interaction with customers and other third-party entities (for example, but
not by way of limitation, client retention, wallet retention, utilization rates, sales performance,
billable headcount and user retention, each as defined by the Committee).

     2.11 “Determination Date” means the latest possible date that will not jeopardize a
Target Award or Actual Award’s qualification as performance-based compensation under Section 162(m)
of the Code.

     2.12 “Disability”
means a permanent disability in accordance with a policy or policies established by the
Committee (in its discretion) from time to time.

     2.13 “Earnings Per Share” means as to any Performance Period, the Company’s after-tax
Profit, divided by a weighted average number of common shares outstanding and/or dilutive common
equivalent shares deemed outstanding.

     2.14 “Employee” means any employee of the Company or of an Affiliate, whether such
employee is so employed at the time the Plan is adopted or becomes so employed subsequent to the
adoption of the Plan.

     2.15 “Financial Efficiency” means as to any Performance Period, the percentage equal
to Profit (or Revenue) for the Performance Period, divided by a financial metric determined by the
Committee (for example, but not by way of limitation, stockholders’ equity or Revenue). Financial
Efficiency shall include, but not be limited to, return on stockholders’ equity, return on capital,
return on assets, return on investment, economic value added and any measure of internal rate of
return, each as defined by the Committee.

     2.16 “Fiscal Year” means the fiscal year of the Company.

     2.17 “Maximum Award” means as to any Participant for any Performance Period, $5
million.

     2.18 “Participant” means as to any Performance Period, an Employee who has been
selected by the Committee for participation in the Plan for that Performance Period.

-2-

 

     2.19 “Payout Formula” means as to any Performance Period, the formula or payout
matrix established by the Committee pursuant to Section 3.4 in order to determine the Actual Awards
(if any) to be paid to Participants. The formula or matrix may differ from Participant to
Participant.

     2.20 “Performance Period” means a Fiscal Year.

     2.21 “Performance Goals”
means the goal(s) (or combined goal(s)) determined by the Committee (in its discretion) to be
applicable to a Participant for a Target Award for a Performance Period. As determined by the
Committee, the Performance Goals for any Target Award applicable to a Participant may provide for a
targeted level or levels of achievement using one or more of the following measures: (a) Cash Flow,
(b) Contract Value, (c) Customer Efficiency, (d) Earnings Per Share, (e) Financial Efficiency, (f)
Profit, (g) Revenue, (h) SG&A and (i) Total Stockholder Return. Performance Goals may differ from
Participant to Participant, Performance Period to Performance Period and from award to award. Any
criteria used may be measured, as applicable, (i) in absolute terms, (ii) in relative terms
(including, but not limited, any increase (or decrease with respect to SG&A) over the passage of
time and/or any measurement against other companies or financial or business or stock index metrics
particular to the Company), (iii) on a per share and/or share per capita basis, (iv) against the
performance of the Company as a whole or against any Affiliate(s), or a particular segment(s), a
business unit(s) or a product(s) of the Company, (v) on a pre-tax or after-tax basis and/or (vi)
using an actual foreign exchange rate or on a foreign exchange neutral basis. Prior to the
Determination Date, the Committee shall determine whether any element(s) (for example, but not by
way of limitation, the effect of mergers or acquisitions) shall be included in or excluded from the
calculation of any Performance Goal with respect to any Participants (whether or not such
determinations result in any Performance Goal being measured on a basis other than generally
accepted accounting principles).

     2.22 “Plan” means the Gartner, Inc. Executive Performance Bonus Plan, as set forth in
this instrument and as hereafter amended from time to time.

     2.23 “Profit” means as to any Performance Period, a measurement of net income as
determined by the Committee with respect to a Performance Goal. Profit may be determined in
accordance with United States Generally Accepted Accounting Principles (“GAAP”) or adjusted to
exclude any or all non-GAAP items.

     2.24 “Retirement” means with respect to any Participant, a Termination of Employment
occurring in accordance with a policy or policies established by the Committee (in its discretion)
from time to time.

     2.25 “Revenue” means as to any Performance Period, net revenues generated or to be
generated (backlog) from third parties.

     2.26 “SG&A” means as to any Performance Period, any and all selling, general and/or
administrative expenses of the Company or any Affiliate(s) as reported in a statement of income for
the period, or
any and all selling, general and/or administrative expenses of the Company or any Affiliate(s)
expressed as a percentage of Revenue or Profit.

-3-

 

     2.27 “Target Award” means the target award payable under the Plan to a Participant
for the Performance Period, expressed as a percentage of his or her Base Salary or a specific
dollar amount, as determined by the Committee in accordance with Section 3.3.

     2.28 “Termination of Employment” means a cessation of the employee-employer
relationship between an Employee and the Company or an Affiliate for any reason, including, but not
by way of limitation, a termination by resignation, discharge, death, Disability, Retirement, or
the disaffiliation of an Affiliate, but excluding any such termination where there is a
simultaneous reemployment by the Company or an Affiliate.

     2.29 “Total Stockholder Return” means as to any Performance Period, the total return
(change in share price plus reinvestment of any dividends) of a share of the Company’s common
stock.

SECTION 3

SELECTION OF PARTICIPANTS AND DETERMINATION OF AWARDS

     3.1 Selection of Participants. The Committee, in its sole discretion, shall select
the Employees who shall be Participants for any Performance Period. The Committee, in its sole
discretion, also may designate as Participants one or more individuals (by name or position) who
are expected to become Employees during a Performance Period. Participation in the Plan is in the
sole discretion of the Committee, and shall be determined on a Performance Period by Performance
Period basis. Accordingly, an Employee who is a Participant for a given Performance Period in no
way is guaranteed or assured of being selected for participation in any subsequent Performance
Period.

     3.2 Determination of Performance Goals. The Committee, in its sole discretion, shall
establish the Performance Goals for each Participant for the Performance Period. Such Performance
Goals shall be set forth in writing.

     3.3 Determination of Target Awards. The Committee, in its sole discretion, shall
establish a Target Award for each Participant. Each Participant’s Target Award shall be determined
by the Committee in its sole discretion, and each Target Award shall be set forth in writing.

     3.4 Determination of Payout Formula or Formulae. On or prior to the Determination Date for a Performance Period, the Committee, in its sole
discretion, shall establish a Payout Formula or Formulae for purposes of determining the Actual
Award (if any) payable to each Participant. Each Payout Formula shall (a) be in writing, (b) be
based on a comparison of actual performance to the Performance Goals, (c) provide for the payment
of a Participant’s Target Award if the Performance Goals for the Performance Period are achieved at
the predetermined level, and (d) provide for the payment of an Actual Award greater than or less
than the Participant’s Target Award, depending upon the extent to which actual performance exceeds
or falls below the Performance Goals. Notwithstanding the preceding, in no event shall a
Participant’s Actual Award for any Performance Period exceed the Maximum Award.

-4-

 

     3.5 Date for Determinations. The Committee shall make all determinations under
Sections 3.1 through 3.4 on or before the Determination Date.

     3.6 Determination of Actual Awards. After the end of each Performance Period, the
Committee shall certify in writing (for example, in its meeting minutes) the extent to which the
Performance Goals applicable to each Participant for the Performance Period were achieved or
exceeded, as determined by the Committee. The Actual Award for each Participant shall be
determined by applying the Payout Formula to the level of actual performance that has been
certified in writing by the Committee. Notwithstanding any contrary provision of the Plan, the
Committee, in its sole discretion, may (a) eliminate or reduce the Actual Award payable to any
Participant below that which otherwise would be payable under the Payout Formula, and (b) determine
whether or not any Participant will receive an Actual Award in the event the Participant incurs a
Termination of Employment prior to the date the Actual Award is to be paid pursuant Section 4.2
below.

SECTION 4

PAYMENT OF AWARDS

     4.1 Right to Receive Payment. Each Actual Award that may become payable under the
Plan shall be paid solely from the general assets of the Company or the Affiliate that employs the
Participant (as the case may be), as determined by the Committee. Nothing in this Plan shall be
construed to create a trust or to establish or evidence any Participant’s claim of any right to
payment of an Actual Award other than as an unsecured general creditor with respect to any payment
to which he or she may be entitled.

     4.2 Timing of Payment. Subject to Section 3.6, payment of each Actual Award shall be
made as soon as administratively practicable, but in no event later than two and one-half months
after the end of the applicable Performance Period.

     4.3 Form of Payment. Each Actual Award shall be paid in cash (or its equivalent) in a single lump sum.

     4.4 Termination of Employment. If a Participant incurs a Termination or Employment
for any reason prior to the end of the Performance Period, such Participant shall not be entitled
to an Award. If a Participant incurs a Termination of Employment due to death, disability or an
involuntary termination prior to the payment of an Actual Award (determined under Section 3.6) that
was scheduled to be paid to him or her prior to such Termination of Employment for a prior
Performance Period, the Award shall be paid to the Participant or, if applicable, to his or her
designated beneficiary or, if no beneficiary has been designated, to his or her estate.

SECTION 5

ADMINISTRATION

     5.1 Committee is the Administrator. The Plan shall be administered by the Committee.
The Committee shall consist of not less than two (2) members of the Board. The members of the
Committee shall be appointed from time to time by, and serve at the pleasure of, the Board. Each
member of the Committee shall qualify as an “outside director” under Section 162(m) of the Code.

-5-

 

If it is later determined that one or more members of the Committee do not so qualify, actions
taken by the Committee prior to such determination shall be valid despite such failure to qualify.
Any member of the Committee may resign at any time by notice in writing mailed or delivered to the
Secretary of the Company. As of the Effective Date of the Plan, the Plan shall be administered by
the Compensation Committee of the Board.

     5.2 Committee Authority. It shall be the duty of the Committee to administer the Plan
in accordance with the Plan’s provisions. The Committee shall have all powers and discretion
necessary or appropriate to administer the Plan and to control its operation, including, but not
limited to, the power to (a) determine which Employees shall be granted awards, (b) prescribe the
terms and conditions of awards, (c) interpret the Plan and the awards, (d) adopt such procedures
and subplans as are necessary or appropriate to permit participation in the Plan by Employees who
are foreign nationals or employed outside of the United States, (e) adopt rules for the
administration, interpretation and application of the Plan as are consistent therewith, and (f)
interpret, amend or revoke any such rules.

     5.3 Decisions Binding. All determinations and decisions made by the Committee, the
Board, and any delegate of the Committee pursuant to the provisions of the Plan shall be final,
conclusive, and binding on all persons, and shall be given the maximum deference permitted by law.

     5.4 Delegation by the Committee. The Committee, in its sole discretion and on such terms and conditions as it may provide,
may delegate all or part of its authority and powers under the Plan to one or more directors and/or
officers of the Company; provided, however, that the Committee may not delegate its authority
and/or powers with respect to awards that are intended to qualify as performance-based compensation
under Section 162(m) of the Code.

SECTION 6

GENERAL PROVISIONS

     6.1 Tax Withholding. The Company or an Affiliate, as determined by the Committee,
shall withhold all applicable taxes from any Actual Award, including any federal, state, local and
other taxes.

     6.2 No Effect on Employment. Nothing in the Plan shall interfere with or limit in any
way the right of the Company or an Affiliate, as applicable, to terminate any Participant’s
employment or service at any time, with or without cause. For purposes of the Plan, transfer of
employment of a Participant between the Company and any one of its Affiliates (or between
Affiliates) shall not be deemed a Termination of Employment. Employment with the Company and its
Affiliates is on an at-will basis only. The Company expressly reserves the right, which may be
exercised at any time and without regard to when during or after a Performance Period such exercise
occurs, to terminate any individual’s employment with or without cause, and to treat him or her
without regard to the effect which such treatment might have upon him or her as a Participant.

     6.3 Participation. No Employee shall have the right to be selected to receive an
award under this Plan, or, having been so selected, to be selected to receive a future award.

-6-

 

     6.4 Indemnification. Each person who is or shall have been a member of the Committee,
or of the Board, shall be indemnified and held harmless by the Company against and from (a) any
loss, cost, liability, or expense that may be imposed upon or reasonably incurred by him or her in
connection with or resulting from any claim, action, suit, or proceeding to which he or she may be
a party or in which he or she may be involved by reason of any action taken or failure to act under
the Plan or any award, and (b) from any and all amounts paid by him or her in settlement thereof,
with the Company’s approval, or paid by him or her in satisfaction of any judgment in any such
claim, action, suit, or proceeding against him or her, provided he or she shall give the Company an
opportunity, at its own expense, to handle and defend the same before he or she undertakes to
handle and defend it on his or her own behalf. The foregoing right of indemnification shall not be
exclusive of any other rights of indemnification to which such persons may be entitled under the
Company’s Certificate of Incorporation or Bylaws, by contract, as a matter of law, or otherwise, or
under any power that the Company may have to indemnify them or hold them harmless.

     6.5 Successors. All obligations of the Company and any Affiliate under the Plan, with
respect to awards granted hereunder, shall be binding on any successor to the Company and/or such
Affiliate, whether the existence of such successor is the result of a direct or indirect purchase,
merger, consolidation, or otherwise, of all or substantially all of the business or assets of the
Company or such Affiliate.

     6.6 Beneficiary Designations.

     a. Designation. Each Participant may, pursuant to such uniform and
nondiscriminatory procedures as the Committee may specify from time to time, designate one
or more Beneficiaries to receive any Actual Award payable to the Participant at the time of
his or her death. Notwithstanding any contrary provision of this Section 6.6 shall be
operative only after (and for so long as) the Committee determines (on a uniform and
nondiscriminatory basis) to permit the designation of Beneficiaries.

     b. Changes. A Participant may designate different Beneficiaries (or may revoke
a prior Beneficiary designation) at any time by delivering a new designation (or revocation
of a prior designation) in like manner. Any designation or revocation shall be effective
only if it is received by the Committee. However, when so received, the designation or
revocation shall be effective as of the date the designation or revocation is executed
(whether or not the Participant still is living), but without prejudice to the Committee on
account of any payment made before the change is recorded. The last effective designation
received by the Committee shall supersede all prior designations.

     c. Failed Designation. If the Committee does not make this Section 6.6
operative or if Participant dies without having effectively designated a Beneficiary, the
Participant’s Account shall be payable to the general beneficiary shown on the records of
the Employer. If no Beneficiary survives the Participant, the Participant‘s Account shall
be payable to his or her estate.

-7-

 

     6.7 Nontransferability of Awards. No award granted under the Plan may be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will, by the
laws of descent and distribution, or to the limited extent provided in Section 6.6. All rights
with respect to an award granted to a Participant shall be available during his or her lifetime
only to the Participant.

     6.8 Deferrals. The Committee, in its sole discretion, may permit a Participant to
defer receipt of the payment of cash that would otherwise be delivered to a Participant under the
Plan. Any such deferral elections shall be made into the Gartner, Inc. Deferred Compensation Plan
(or such other
similar nonqualified deferred compensation plan in effect at the time) and subject to such
rules and procedures as shall be determined by the Committee in its sole discretion.

SECTION 7

AMENDMENT, TERMINATION AND DURATION

     7.1 Amendment, Suspension or Termination. The Board or the Committee, each in its
sole discretion, may amend or terminate the Plan, or any part thereof, at any time and for any
reason. The amendment, suspension or termination of the Plan shall not, without the consent of the
Participant, alter or impair any rights or obligations under any Target Award theretofore granted
to such Participant. No award may be granted during any period of suspension or after termination
of the Plan.

     7.2 Duration of the Plan. The Plan shall commence on the date specified herein, and
subject to Section 7.1 (regarding the Board or the Committee’s right to amend or terminate the
Plan), shall remain in effect thereafter.

SECTION 8

LEGAL CONSTRUCTION

     8.1 Gender and Number. Except where otherwise indicated by the context, any masculine
term used herein also shall include the feminine; the plural shall include the singular and the
singular shall include the plural.

     8.2 Severability. In the event any provision of the Plan shall be held illegal or
invalid for any reason, the illegality or invalidity shall not affect the remaining parts of the
Plan, and the Plan shall be construed and enforced as if the illegal or invalid provision had not
been included.

     8.3 Requirements of Law. The granting of awards under the Plan shall be subject to
all applicable laws, rules and regulations, and to such approvals by any governmental agencies or
national securities exchanges as may be required.

     8.4 Governing Law. The Plan and all awards shall be construed in accordance with and
governed by the laws of the State of Connecticut, but without regard to its conflict of law
provisions.

     8.5 Captions. Captions are provided herein for convenience only, and shall not serve as a basis for
interpretation or construction of the Plan.

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EXECUTION

     IN WITNESS WHEREOF, Gartner, Inc., by its duly authorized officer, has executed the Plan on
the date indicated below.

	 	 	 	 	 
	 	GARTNER, INC.

 	 
	Dated: June 5, 2007 	By:  	/s/ Christopher J. Lafond
 	 
	 	 	Name:  	Christopher J. Lafond 	 
	 	 	Title:  	EVP and Chief Financial Officer 	 
	 

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