Document:

Exhibit 10.6

 

EXECUTION VERSION

 

CONTRIBUTION AGREEMENT

 

By and Among

 

SUSSER PETROLEUM PARTNERS LP

 

SUSSER PETROLEUM PARTNERS GP LLC

 

SUSSER HOLDINGS CORPORATION

 

SUSSER HOLDINGS, L.L.C.

 

STRIPES LLC

 

and

 

SUSSER PETROLEUM COMPANY LLC

 

Dated as of September 25, 2012

 

 

CONTRIBUTION AGREEMENT

 

This Contribution Agreement, dated as of September 25, 2012 (this “Agreement”), is by and among Susser Petroleum Partners LP, a Delaware limited partnership (the “Partnership”), Susser Petroleum Partners GP LLC, a Delaware limited liability company (the “General Partner”), Susser Holdings Corporation, a Delaware corporation (“SHC”), Susser Holdings, L.L.C., a Delaware limited liability company (“Holdings”), Stripes LLC, a Texas limited liability company (“Stripes”) and Susser Petroleum Company LLC, a Texas limited liability company (“SPC”).  The above-named entities are sometimes referred to in this Agreement each as a “Party” and collectively as the “Parties.”  Capitalized terms used herein shall have the meanings assigned to such terms in Article I.

 

RECITALS

 

WHEREAS, the General Partner and SHC have formed the Partnership under the terms of the Delaware Revised Uniform Limited Partnership Act (the “Delaware LP Act”), for the purpose of engaging in any business activity that is approved by the General Partner and that lawfully may be conducted by a limited partnership organized pursuant to the Delaware LP Act.

 

WHEREAS, in connection with the Offering, and in order to accomplish the objectives and purposes in the preceding recital each of the following actions has been taken prior to the date hereof:

 

1.                                      SHC formed the General Partner under the terms of the Delaware Limited Liability Company Act (the “Delaware LLC Act”) and contributed $1,000 in exchange for all of the member interests in the General Partner.

 

2.                                      The General Partner and SHC formed the Partnership under the terms of the Delaware LP Act and contributed $0 and $1,000, respectively, in exchange for a 0% non-economic general partner interest and a 100% limited partner interest, respectively, in the Partnership.

 

3.                                      SPC formed Susser Petroleum Operating Company LLC (“Susser Operating”) under the terms of the Delaware LLC Act and contributed $1,000 in exchange for all of the membership interests in Susser Operating.

 

4.                                      Susser Operating formed Susser Petroleum Property Company LLC (“Susser Propco”) under the terms of the Delaware LLC Act and contributed $1,000 in exchange for all of the membership interests in Susser Propco.

 

5.                                      T&C Wholesale, Inc. filed a certificate of conversion under the terms of the Texas Business Organizations Code (“TBOC”) to convert to a limited liability company named T&C Wholesale, LLC (“T&C Wholesale”).

 

6.                                      SHC, Susser Operating, Stripes and SPC entered into the SHC Distribution Contract.

 

7.                                      Susser Operating and SPC entered into the SHC Transportation Contract.

 

 

8.                                      Holdings distributed $118,000,000.00 to Stripes Holdings LLC, a wholly owned subsidiary of SHC (“Stripes Holdings”), in compliance with the Restricted Payments Covenant.  Stripes Holdings then distributed such amounts to SHC.

 

WHEREAS, concurrently with the consummation of the transactions contemplated hereby, each of the following transactions shall occur in the following order:

 

1.                                      SPC shall convey and contribute to Susser Operating all of SPC’s right, title and interest in and to all of the membership interests in T&C Wholesale (the “T&C Wholesale Interests”).

 

2.                                      The Issuer Group shall sell, convey, assign, transfer, contribute and deliver to Susser Operating:

 

a.                                      all of SPC’s right, title, duties, obligations and interests as tenant under the certain leases and subleases, and other agreements ancillary thereto, together with all modifications, addenda and amendments thereto (the “Tenant Leases”), more particularly described on Exhibit A attached to that certain Assignment and Assumption of Lease Agreements (SPC as Tenant), dated as of September 25, 2012 (the “Tenant Lease Assignment”);

 

b.                                      all of SPC’s right, title, duties, obligations and interests as landlord under the certain leases and subleases, and other agreements ancillary thereto, together with all modifications, addenda and amendments thereto (the “Landlord Leases”), more particularly described on Exhibit A attached to that certain Assignment and Assumption of Lease Agreements (SPC as Landlord), dated as of September 25, 2012 (the “Landlord Lease Assignment”);

 

c.                                       all of SPC’s right, title, duties, obligations and interests under certain vendor agreements, related to, among other things, certain merchandise purchasing and promotional programs arranged with dealers and vendors, and other agreements ancillary thereto (the “Vendor Agreements”), more particularly described on Exhibit A attached to that certain Assignment and Assumption of Vendor Agreements, dated as of September 25, 2012 (the “Vendor Agreement Assignment”);

 

d.                                      all of SPC’s right, title, duties, obligations and interests under certain marketer, distributor and supply agreements, pursuant to which, among other things, SPC purchases motor fuel from oil companies and refiners, and other agreements ancillary thereto (the “Fuel Supplier Agreements”), more particularly described on Exhibit A attached to that certain Assignment and Assumption of Fuel Supplier Agreements, dated as of September 25, 2012 (the “Fuel Supplier Agreement Assignment”);

 

e.                                       all of SPC’s right, title, duties, obligations and interests under certain fuel supply and bid and subjobber agreements, pursuant to which, among other

 

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things, SPC distributes motor fuel to convenience stores and other retail fuel outlets, and other agreements ancillary thereto (the “Dealer Supply Agreements”), more particularly described on Exhibit A attached to that certain Assignment and Assumption of Dealer Supply Agreements, dated as of September 25, 2012 (the “Dealer Supply Agreement Assignment”);

 

f.                                        all of SHC’s or its subsidiaries’ right, title and interests in certain real property owned in fee and located in Texas, together with all benefits, privileges, easements, tenements, hereditaments thereon or appertaining thereto, and any and all right, title and interest in and to adjacent roads and rights-of-way (the “Conveyed Real Property”), more particularly described on Schedule A attached hereto, pursuant to certain Special Warranty Deeds, dated as of September 25, 2012 (the “Special Warranty Deeds”); and

 

g.                                       all of SHC’s or its subsidiaries’ right, title and interests in and to certain personal property (the “Conveyed Personal Property”), more particularly described on Exhibit A attached to that certain Bills of Sale, dated as of September 25, 2012 (the “Bills of Sale”).

 

The Tenant Leases, Landlord Leases, Vendor Agreements, Fuel Supplier Agreements, Dealer Supply Agreements, Conveyed Real Property, Conveyed Personal Property, SHC Distribution Contract and SHC Transportation Contract are collectively referred to herein as the “Contributed Assets.”  The Tenant Lease Assignment, Landlord Lease Assignment, Vendor Agreement Assignment, Fuel Supplier Agreement Assignment, Dealer Supply Agreement Assignment, Special Warranty Deeds and Bills of Sale, and other agreements ancillary thereto, are collectively referred to herein as the “Assignment Documents.”

 

3.                                      SHC and the Partnership shall enter into the Omnibus Agreement (the “Omnibus Agreement”), pursuant to which, among other things, SHC will provide the Partnership with certain rights regarding future business opportunities, SHC will provide certain operational services to the Partnership and SHC and the Partnership will agree to certain indemnification obligations.

 

4.                                      SPC shall convey and contribute to the Partnership all of SPC’s right, title and interest in and to all of the membership interests in Susser Operating (the “Susser Operating Interests”), in exchange for the conveyance and distribution by the Partnership to SHC or its subsidiaries of:

 

a.                                      14,436 Common Units representing a 0.07% limited partner interest in the Partnership, all of which will be conveyed by the Partnership to Stripes;

 

b.                                      10,939,436 Subordinated Units representing a 50.0% limited partner interest in the Partnership, of which 5,469,718 Subordinated Units will be conveyed by the Partnership to Stripes No. 1009 LLC, a Texas limited

 

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liability company (“Stripes No. 1009”) and 5,469,718 Subordinated Units will be conveyed by the Partnership to Stripes;

 

c.                                       the Incentive Distribution Rights, all of which will be conveyed by the Partnership to SHC;

 

d.                                      a cash distribution in the amount of $336,530,270.00, as described in paragraph 11 below (all of which shall be conveyed by SHC to the Issuer Group); and

 

e.                                       the right for SHC to either (i) receive up to an additional 1,425,000 Common Units, (ii) receive a cash distribution of the proceeds of the Over-Allotment Option Debt if the Underwriters exercise the Over-Allotment Option, or (iii) a combination of both (i) and (ii).

 

5.                                      The Partnership shall redeem the 100% initial limited partner interest in the Partnership held by SHC and refund and distribute to SHC the initial capital contribution made by it to the Partnership along with 100% of any interest or other profit that resulted from the investment or other use of such initial capital contribution.

 

6.                                      On September 21, 2012, the Underwriters exercised the Over-Allotment Option in full, and the Partnership will (i) deliver an additional 1,425,000 Common Units to the Underwriters on the date hereof, (ii) use the proceeds from the Over-Allotment Option to purchase U.S. Treasury or other similar securities (“Treasuries”), (iii) use the Treasuries as collateral to borrow an equal amount of debt guaranteed by SHC (the “Over-Allotment Option Debt”), (iv) distribute the proceeds of the Over-Allotment Option Debt to SHC.

 

7.                                      At the Effective Time, the public, through the Underwriters, shall contribute to the Partnership $223,962,500.00 ($210,647,129.33 net of the Underwriters’ discount) in exchange for 10,925,000 Common Units representing a 49.9% limited partner interest in the Partnership in connection with the Offering.

 

8.                                      The Partnership shall use a portion of the proceeds from the Offering to make a distribution of $25,364,303.00 to SHC to reimburse SHC for certain capital expenditures incurred with respect to the Contributed Assets.

 

9.                                      The Partnership will (i) use the remainder of the proceeds from the Offering of $180,665,967.00 to purchase Treasuries, (ii) pledge the Treasuries as collateral for a new loan that is fully guaranteed by SHC (the “Recourse Loan”), and (iii) distribute the proceeds from the Recourse Loan to SHC.

 

10.                               SHC will borrow $12,500,000.00 under the Term Loan and Pledge Agreement, dated September 25, 2012, by and among SHC, as Borrower and Bank of America, N.A, as Lender (the “SHC Term Loan”) to satisfy the remaining cash consideration requirements under the Asset Sales Covenant.

 

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11.                               SHC will use the proceeds from the distributions made by the Partnership to SHC described in paragraphs 8 and 9, together with approximately $118,000,000.00 in cash on-hand (previously distributed to Stripes Holdings in compliance with the Restricted Payments Covenant under the Holdings Indenture, and subsequently distributed to SHC) and the $12,500,000.00 proceeds of the loan described in paragraph 10 to make a total payment of $336,530,270.00 to the Issuer Group to satisfy the cash consideration component of the Asset Sales Covenant under the Holdings Indenture.

 

12.                               Susser Propco will file an election on Form 8832 to be treated as a corporation for U.S. federal income tax purposes that will be effective as of the date of the closing of the Offering.

 

NOW, THEREFORE, in consideration of the mutual covenants, representations, warranties and agreements herein contained, the Parties hereto agree as follows:

 

ARTICLE I
 DEFINITIONS

 

The terms set forth below in this Article I shall have the meanings ascribed to them below or in the part of this Agreement referred to below:

 

“Agreement” has the meaning assigned to such term in the preamble.

 

“Asset Sales Covenant” means the covenant set forth in Section 4.10 of the Holdings Indenture.

 

“Assignment Documents” has the meaning assigned to such term in the recitals.

 

“Bills of Sale” has the meaning assigned to such term in the recitals.

 

“Commission” means the U.S. Securities and Exchange Commission.

 

“Common Units” means the common units representing limited partner interests in the Partnership.

 

“Contributed Assets” has the meaning assigned to such term in the recitals.

 

“Conveyed Personal Property” has the meaning assigned to such term in the recitals.

 

“Conveyed Real Property” has the meaning assigned to such term in the recitals.

 

“Dealer Supply Agreement Assignment” has the meaning assigned to such term in the recitals.

 

“Dealer Supply Agreements” has the meaning assigned to such term in the recitals.

 

“Delaware LLC Act” has the meaning assigned to such term in the recitals.

 

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“Delaware LP Act” has the meaning assigned to such term in the recitals.

 

“Effective Time” means immediately prior to the closing of the Offering.

 

“Fuel Supplier Agreement Assignment” has the meaning assigned to such term in the recitals.

 

“Fuel Supplier Agreements” has the meaning assigned to such term in the recitals.

 

“General Partner” has the meaning assigned to such term in the preamble.

 

“Holdings” has the meaning assigned to such term in the preamble.

 

“Holdings Indenture” means that certain Indenture dated as of May 7, 2010, by and among Holdings, Susser Finance Corporation, the guarantors named therein and Wells Fargo Bank, N.A., as Trustee, relating to the issuance of the 8.50% Senior Notes due 2016 of Holdings.

 

“Incentive Distribution Rights” has the meaning assigned to such term in the Partnership Agreement.

 

“Issuer Group” means Holdings and its Restricted Subsidiaries (as such term is defined in the Holdings Indenture).

 

“Landlord Lease Assignment” has the meaning assigned to such term in the recitals.

 

“Landlord Leases” has the meaning assigned to such term in the recitals.

 

“Offering”  means the initial offering and sale of Common Units to the public, as described in the Registration Statement, including any offer and sale of Common Units pursuant to the exercise of the Over-Allotment Option.

 

“Omnibus Agreement” has the meaning assigned to such term in the recitals.

 

“Over-Allotment Option Debt” has the meaning assigned to such term in the recitals.

 

“Over-Allotment Option” has the meaning assigned to such term in the Partnership Agreement.

 

“Partnership” has the meaning assigned to such term in the preamble.

 

“Party or Parties” has the meaning assigned to such term in the preamble

 

“Partnership Agreement” means the First Amended and Restated Agreement of Limited Partnership of the Partnership, dated as of September 25, 2012.

 

“Recourse Loan” has the meaning assigned to such term in the recitals.

 

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“Registration Statement” means the Registration Statement on Form S-1 filed with the Commission (Registration No. 333- 182276), as amended and effective pursuant to the Securities Act at the Effective Time.

 

“Restricted Payments Covenant” means the covenant set forth in Section 4.07 of the Holdings Indenture.

 

“Securities Act” means the Securities Act of 1933, as amended.

 

“SHC” has the meaning assigned to such term in the preamble.

 

“SHC Distribution Contract” means that certain fuel supply agreement by and among SHC, Susser Operating, Stripes and SPC, dated as of September 25, 2012.

 

“SHC Term Loan” has the meaning assigned to such term in the recitals.

 

“SHC Transportation Contract” means that certain transportation services agreement by and among Susser Operating and SPC, dated as of September 25, 2012.

 

“SPC” has the meaning assigned to such term in the preamble.

 

“Special Warranty Deeds” has the meaning assigned to such term in the recitals.

 

“Stripes” has the meaning assigned to such term in the preamble.

 

“Stripes Holdings” has the meaning assigned to such term in the recitals.

 

“Stripes No. 1009” has the meaning assigned to such term in the recitals.

 

“Subordinated Units” has the meaning assigned to such term in the Partnership Agreement.

 

“Susser Operating” has the meaning assigned to such term in the recitals.

 

“Susser Operating Interests” has the meaning assigned to such term in the recitals.

 

“Susser Propco” has the meaning assigned to such term in the recitals.

 

“T&C Wholesale” has the meaning assigned to such term in the recitals.

 

“T&C Wholesale Interests” has the meaning assigned to such term in the recitals.

 

“TBOC” has the meaning assigned to such term in the recitals.

 

“Tenant Lease Assignment” has the meaning assigned to such term in the recitals.

 

“Tenant Leases” has the meaning assigned to such term in the recitals.

 

“Treasuries” has the meaning assigned to such term in the recitals.

 

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“Underwriters” means those underwriters listed in the Underwriting Agreement.

 

“Underwriting Agreement” means that certain Underwriting Agreement between SHC, the Partnership, the General Partner and the Underwriters, dated as of September 19, 2012.

 

“Vendor Agreement Assignment” has the meaning assigned to such term in the recitals.

 

“Vendor Agreements” has the meaning assigned to such term in the recitals.

 

ARTICLE II
 CONTRIBUTION, ACKNOWLEDGEMENTS AND DISTRIBUTIONS

 

Section 2.1                                   Election to Treat Susser Propco as a Corporation.  The Parties acknowledge that Susser Propco will file a valid election on Internal Revenue Service Form 8832 for Susser Propco to be treated for U.S. federal income tax purposes as a corporation, effective as of the date of the closing of the Offering.

 

Section 2.2                                   Conveyance of Contributed Assets to Susser Operating. The Parties acknowledge the sale, conveyance, assignment, transfer, contribution and delivery by SHC and its subsidiaries to Susser Operating of certain of the Contributed Assets pursuant to the Assignment Documents.

 

Section 2.3                                   Contribution of T&C Wholesale Interests to Susser Operating.  SPC hereby grants, contributes, bargains, conveys, assigns, transfers, sets over and delivers to Susser Operating, its successors and assigns, for its and their own use forever, all right, title and interest in and to the T&C Wholesale Interests.

 

Section 2.4                                   Entry Into Omnibus Agreement. The Parties acknowledge the entry into the Omnibus Agreement by SHC and the MLP.

 

Section 2.5                                   Contribution of Susser Operating Interests to the Partnership.  SHC and the Issuer Group have entered into the Omnibus Agreement and hereby grant, contribute, bargain, convey, assign, transfer, set over and deliver to the Partnership, its successors and assigns, for its and their own use forever, all right, title and interest in and to the Susser Operating Interests as a contribution of capital to the Partnership in exchange for:

 

(a)         14,436 Common Units representing a 0.07% limited partner interest in the Partnership, all of which will be conveyed by the Partnership to Stripes;

 

(b)         10,939,436 Subordinated Units representing a 50.0% limited partner interest in the Partnership, of which 5,469,718 Subordinated Units will be conveyed by the Partnership to Stripes No. 1009 and 5,469,718 Subordinated Units will be conveyed by the Partnership to Stripes;

 

(c)          Incentive Distribution Rights,  all of which will be conveyed by the Partnership to SHC;

 

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(d)   a right to receive a distribution of $25,364,303.00 from the Partnership in whole or in part reimbursing SHC and the Issuer Group for pre-formation capital expenditures with respect to the Contributed Assets and to partially satisfy the Asset Sales Covenant; and

 

(e)   a right to receive a distribution of $180,665,967.00 from the proceeds of the Recourse Loan.

 

The Partnership hereby accepts the Susser Operating Interests as a contribution to the capital of the Partnership.

 

Section 2.6            Purchase of Treasuries by the Partnership and Incurrence of Recourse Loan.  The Parties acknowledge (i) the purchase by the Partnership of $180,665,967.00 of Treasuries and (ii) the pledge of the Treasuries as collateral for the Recourse Loan.

 

Section 2.7            Underwriters’ Cash Contribution.  The Parties acknowledge that the Underwriters have, pursuant to the Underwriting Agreement, made a capital contribution to the Partnership of $223,962,500.00 in cash ($210,647,129.33 net to the Partnership after the Underwriters’ discount of $13,315,371.00) in exchange for the issuance by the Partnership to the Underwriters of 10,925,000 Common Units, which includes 1,425,000 Common Units issued pursuant to the Underwriters full exercise of the Over-Allotment Option (collectively representing a 49.9% limited partner interest in the Partnership).

 

Section 2.8            Payment of Transaction Expenses and Distribution by the Partnership to SHC.  SHC acknowledges the payment and distribution by the Partnership, in connection with the transactions contemplated hereby, of:

 

(a)   estimated transaction expenses paid to SHC in the amount of approximately $3,776,999.95 (exclusive of the Underwriters’ discount and any structuring fee);

 

(b)   $25,364,303.00 of the net proceeds of the Offering to SHC as a reimbursement for certain pre-formation capital expenditures; and

 

(c)   a distribution of $180,665,967.00 to SHC from the proceeds of the Recourse Loan.

 

Section 2.9            Additional Borrowings to Satisfy the Asset Sales Covenant. The Parties acknowledge the borrowing by SHC of $12,500,000.00 pursuant to the SHC Term Loan.

 

Section 2.10         Payment by SHC to the Issuer Group.  The Issuer Group acknowledges the payment received from SHC, in connection with the transactions contemplated hereby, of $336,530,270.00, which included payments made by the Partnership to SHC described in Sections 2.8(b) and 2.8(c) and the additional borrowings by SHC described in Section 2.9, together with $118,000,000.00 in cash on hand (previously distributed to Stripes Holdings in compliance with the Restricted Payments Covenant under the Holdings Indenture, and subsequently distributed to SHC), to satisfy the cash consideration component of the Asset Sales Covenant.

 

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Section 2.11         Redemption of the Initial Partner Interests in the Partnership and the Return of Initial Capital Contributions.  The Partnership hereby redeems the 100% initial limited partner interest in the Partnership held by SHC and hereby refunds and distributes to SHC the initial capital contribution made by it to the Partnership along with 100% of any interest or other profit that resulted from the investment or other use of such initial capital contribution.

 

ARTICLE III
 FURTHER ASSURANCES

 

From time to time after the Effective Time, and without any further consideration, the Parties agree to execute, acknowledge and deliver all such additional deeds, assignments, bills of sale, conveyances, instruments, notices, releases, acquittances and other documents, and to do all such other acts and things, all in accordance with applicable law, as may be necessary or appropriate (a) more fully to assure that the applicable Parties own all of the properties, rights, titles, interests, estates, remedies, powers and privileges granted by this Agreement, or which are intended to be so granted, (b) more fully and effectively to vest in the applicable Parties and their respective successors and assigns beneficial and record title to the interests contributed and assigned by this Agreement or intended to be so and (c) more fully and effectively to carry out the purposes and intent of this Agreement.

 

ARTICLE IV
 EFFECTIVE TIME

 

Notwithstanding anything contained in this Agreement to the contrary, none of the provisions of Article II of this Agreement shall be operative or have any effect until the Effective Time, at which time all the provisions of Article II of this Agreement shall be effective and operative in accordance with Article V, without further action by any Party hereto.

 

ARTICLE V
 MISCELLANEOUS

 

Section 5.1            Order of Completion of Transactions.         The transactions provided for in Article II shall be completed immediately following the Effective Time in the order set forth therein.

 

Section 5.2            Headings; References; Interpretation.         All Article and Section headings in this Agreement are for convenience only and shall not be deemed to control or affect the meaning or construction of any of the provisions hereof. The words “hereof,” “herein” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole, including, without limitation, all Schedules and Exhibits attached hereto, and not to any particular provision of this Agreement. All references herein to Articles, Sections, Schedules and Exhibits shall, unless the context requires a different construction, be deemed to be references to the Articles and Sections of this Agreement and the Schedules and Exhibits attached hereto, and all such Schedules and Exhibits attached hereto are hereby incorporated herein and made a part hereof for all purposes. All personal pronouns used in this Agreement, whether used in the masculine, feminine or neuter gender, shall include all other genders, and the singular shall include the plural and vice versa. The use herein of the word “including” following

 

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any general statement, term or matter shall not be construed to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar items or matters, whether or not non-limiting language (such as “without limitation”, “but not limited to”, or words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that could reasonably fall within the broadest possible scope of such general statement, term or matter.

 

Section 5.3            Successors and Assigns.    This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors and assigns.

 

Section 5.4            No Third Party Rights.     The provisions of this Agreement are intended to bind the Parties as to each other and are not intended to and do not create rights in any other person or confer upon any other person any benefits, rights or remedies, and no person is or is intended to be a third party beneficiary of any of the provisions of this Agreement.

 

Section 5.5            Counterparts.      This Agreement may be executed in any number of counterparts with the same effect as if all signatory Parties had signed the same document.  All counterparts shall be construed together and shall constitute one and the same instrument.

 

Section 5.6            Choice of Law.    This Agreement shall be subject to and governed by the laws of the State of Texas. Each Party hereby submits to the jurisdiction of the state and federal courts in the State of Texas and to venue in Houston, Texas.

 

Section 5.7            Severability.        If any of the provisions of this Agreement are held by any court of competent jurisdiction to contravene, or to be invalid under, the laws of any political body having jurisdiction over the subject matter hereof, such contravention or invalidity shall not invalidate the entire Agreement. Instead, this Agreement shall be construed as if it did not contain the particular provisions or provisions held to be invalid and an equitable adjustment shall be made and necessary provision added so as to give effect to the intention of the Parties as expressed in this Agreement at the time of execution of this Agreement.

 

Section 5.8            Amendment or Modification.         This Agreement may be amended or modified from time to time only by the written agreement of all the Parties. Each such instrument shall be reduced to writing and shall be designated on its face as an amendment to this Agreement.

 

Section 5.9            Integration.          This Agreement and the instruments referenced herein supersede all previous understandings or agreements among the Parties, whether oral or written, with respect to the subject matter of this Agreement and such instruments. This Agreement and such instruments contain the entire understanding of the Parties with respect to the subject matter hereof and thereof. No understanding, representation, promise or agreement, whether oral or written, is intended to be or shall be included in or form part of this Agreement unless it is contained in a written amendment hereto executed by the parties hereto after the date of this Agreement.

 

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Section 5.10         Deed; Bill of Sale; Assignment.      To the extent required and permitted by applicable law, this Agreement shall also constitute a “deed,” “bill of sale” or “assignment” of the assets and interests referenced herein.

 

[Signature Pages Follow]

 

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IN WITNESS WHEREOF, the parties to this Agreement have caused it to be duly executed as of the date first above written.

 

	
 
    	
SUSSER   PETROLEUM PARTNERS LP
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
SUSSER   PETROLEUM PARTNERS GP LLC,
    
	
 
    	
 
    	
its   general partner
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ E.V. Bonner, Jr.
    
	
 
    	
 
    	
Name:
    	
E.V.   Bonner, Jr.
    
	
 
    	
 
    	
Title:
    	
Executive   Vice President, General
    
	
 
    	
 
    	
 
    	
Counsel   and Secretary
    
	
 
    	
 
    	
 
    
	
 
    	
SUSSER   PETROLEUM PARTNERS GP LLC
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ E.V. Bonner, Jr.
    
	
 
    	
 
    	
Name:
    	
E.V.   Bonner, Jr.
    
	
 
    	
 
    	
Title:
    	
Executive   Vice President, General
    
	
 
    	
 
    	
 
    	
Counsel   and Secretary
    
	
 
    	
 
    	
 
    
	
 
    	
SUSSER   HOLDINGS CORPORATION
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ E.V. Bonner, Jr.
    
	
 
    	
 
    	
Name:
    	
E.V.   Bonner, Jr.
    
	
 
    	
 
    	
Title:
    	
Executive   Vice President, General
    
	
 
    	
 
    	
 
    	
Counsel   and Secretary
    
	
 
    	
 
    	
 
    
	
 
    	
SUSSER   HOLDINGS, L.L.C.
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ E.V. Bonner, Jr.
    
	
 
    	
 
    	
Name:
    	
E.V.   Bonner, Jr.
    
	
 
    	
 
    	
Title:
    	
Executive   Vice President, General
    
	
 
    	
 
    	
 
    	
Counsel   and Secretary
    
	
 
    	
 
    	
 
    
	
 
    	
STRIPES   LLC
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ E.V. Bonner, Jr.
    
	
 
    	
 
    	
Name:
    	
E.V.   Bonner, Jr.
    
	
 
    	
 
    	
Title:
    	
Executive   Vice President, General
    
	
 
    	
 
    	
 
    	
Counsel   and Secretary
    
	
 
    	
 
    	
 
    
	
 
    	
SUSSER   PETROLEUM COMPANY LLC
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ E.V. Bonner, Jr.
    
	
 
    	
 
    	
Name:
    	
E.V.   Bonner, Jr.
    
	
 
    	
 
    	
Title:
    	
Executive   Vice President and Secretary
    

 

Signature Page to Contribution Agreement

 

 

Schedule A

 

Conveyed Real Property

 

	
Location
    	
 
    	
Street Address
    	
 
    	
City
    	
 
    	
Fee Title Owner
    
	
4127-TIMEWISE   #2101
    	
 
    	
1600   W Church St
    	
 
    	
Livingston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4008-IB   #4008-FM 1960, HOU
    	
 
    	
6951   W FM 1960
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4009-CLOVERLEAF   CHEVRON SVC.
    	
 
    	
14427   Market St
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4023-IB   #4023-MAXEY
    	
 
    	
12325   East Freeway
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4030-HP   #10-STUDEMONT
    	
 
    	
1003   Studemont
    	
 
    	
Houston
    	
 
    	
Corpus   Christi Reimco, LLC
    
	
4100-CHAMDAL   FOOD MART
    	
 
    	
12720   Hempstead Hwy
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4114-HP   #114
    	
 
    	
7330   S. Lake Houston Parkway
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4120-HP   #22-HIRSCH
    	
 
    	
10714   Hirsch
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4130-HP   #30-MANVEL
    	
 
    	
20135   Morris
    	
 
    	
Manvel
    	
 
    	
Corpus   Christi Reimco, LLC
    
	
4131-HP   #29-NAVIGATION
    	
 
    	
4624   Navigation
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4132-PEARLAND   CHEVRON
    	
 
    	
2121   N Main
    	
 
    	
Pearland
    	
 
    	
Susser   Petroleum Company LLC
    
	
4151-HP   #33-DAIRY ASHFORD
    	
 
    	
12790   S Dairy Ashford
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4157-HP   #32-ALIEF CLODINE
    	
 
    	
13575   Alief Clodine
    	
 
    	
Houston
    	
 
    	
Corpus   Christi Reimco, LLC
    
	
4163-MISSOURI   CITY CHEVRON
    	
 
    	
6181   Hwy 6
    	
 
    	
Missouri   City
    	
 
    	
Corpus   Christi Reimco, LLC
    
	
4164-HP   #40-LITTLE YORK
    	
 
    	
3405   W Little York
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4166-IB   #4166-PEASE, HOUSTON
    	
 
    	
2350   Pease
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4168-IB   #4168-BROADWAY, PEAR
    	
 
    	
1602   E Broadway
    	
 
    	
Pearland
    	
 
    	
Susser   Petroleum Company LLC
    
	
4175-HP   #45-ANGLETON
    	
 
    	
2301   Hwy 35 W
    	
 
    	
Angleton
    	
 
    	
Susser   Petroleum Company LLC
    
	
4193-IB   #4193-CALVACADE
    	
 
    	
812   West Cavalcade
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4197-HP   #49-FM 1093
    	
 
    	
20710   FM 1093
    	
 
    	
Richmond
    	
 
    	
Corpus   Christi Reimco, LLC
    
	
4198-IB   #4198-HADLEY
    	
 
    	
2222   Louisiana
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4199-CLEVELAND   CHEVRON
    	
 
    	
600   W. Southline
    	
 
    	
Cleveland
    	
 
    	
Corpus   Christi Reimco, LLC
    
	
4203-IB   #4203-WOODFOREST, HOU
    	
 
    	
12555   Woodforest
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4228-HP   #228
    	
 
    	
14555   Eastex Freeway
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4332-HP#332   REED RD
    	
 
    	
2665   Reed Rd
    	
 
    	
Houston
    	
 
    	
Corpus   Christi Reimco, LLC
    
	
4440-IB   #4440-HWY 3, WEBSTER and 4485-SHA & SON’S
    	
 
    	
14810   Galveston Rd
    	
 
    	
Webster
    	
 
    	
Susser   Petroleum Company LLC
    

 

 

	
4443-IB   #4443-WINDFERN and 4815-NAILEEN ENTERPRISES
    	
 
    	
7702   Windfern
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
4450-CITGO   FOOD MART
    	
 
    	
2528   North Fwy
    	
 
    	
Houston
    	
 
    	
Corpus   Christi Reimco, LLC
    
	
4467-IB   #4467-LOCKWOOD, HOU
    	
 
    	
5445   I-10 East Freeway
    	
 
    	
Houston
    	
 
    	
Corpus   Christi Reimco, LLC
    
	
4468-IRVINGTON   FOOD MART
    	
 
    	
6121   Irvington
    	
 
    	
Houston
    	
 
    	
Corpus   Christi Reimco, LLC
    
	
4482-IceBox   #4482
    	
 
    	
26026   Southwest Freeway
    	
 
    	
Rosenberg
    	
 
    	
Susser   Petroleum Company LLC
    
	
4849-BEST   FOOD #2
    	
 
    	
5403   Evers Rd.
    	
 
    	
San   Antonio
    	
 
    	
Susser   Petroleum Company LLC
    
	
4924-   IB #4924 BEAUMONT
    	
 
    	
5112   MLK PKWY
    	
 
    	
Beaumont
    	
 
    	
Susser   Petroleum Company LLC
    
	
7333-MANVEL   FOOD MART
    	
 
    	
7206   S. Broadway
    	
 
    	
Pearland
    	
 
    	
Stripes   LLC
    
	
7335-HP   #335
    	
 
    	
22525   State Highway 6
    	
 
    	
Alvin
    	
 
    	
Stripes   LLC
    
	
7336-HP   #7336
    	
 
    	
2112   E Broadway
    	
 
    	
Pearland
    	
 
    	
Stripes   LLC
    
	
7340-IB   #7340-SEAWALL, GALV
    	
 
    	
4502   Seawall
    	
 
    	
Galveston
    	
 
    	
Susser   Petroleum Company LLC
    
	
7341-WESLEYAN   CHEV FOOD
    	
 
    	
4002   Southwest Freeway
    	
 
    	
Houston
    	
 
    	
Susser   Petroleum Company LLC
    
	
5801-QUICK   MART
    	
 
    	
101   Santa Rosa Avenue
    	
 
    	
Edcouch
    	
 
    	
Susser   Petroleum Company LLC
    
	
5813-RVG   GROCERY
    	
 
    	
801   South Cage
    	
 
    	
Pharr
    	
 
    	
Susser   Petroleum Company LLC
    
	
5955-TIMES   MARKET #107
    	
 
    	
4701   Greenwood
    	
 
    	
Corpus   Christi
    	
 
    	
Susser   Petroleum Company LLCExhibit 10.1

 

YOUKU TUDOU INC. SHARE INCENTIVE PLAN

 

ARTICLE 1

 

PURPOSE

 

The purpose of the Youku Tudou Inc. Share Incentive Plan (formerly named as “Youku Inc. 2010 Share Incentive Plan”) is to promote the success and enhance the value of Youku Tudou Inc., a company formed under the laws of the Cayman Islands (the “Company”) by linking the personal interests of the members of the Board, Employees, and Consultants to those of the Company’s shareholders and by providing such individuals with an incentive for outstanding performance.  The Plan is further intended to provide flexibility to the Company in its ability to motivate, attract, and retain the services of members of the Board, Employees and Consultants upon whose judgment and contribution the Company’s business is largely dependent.

 

ARTICLE 2

 

DEFINITIONS AND CONSTRUCTION

 

Wherever the following terms are used in the Plan they shall have the meanings specified below, unless the context clearly indicates otherwise.  The singular pronoun shall include the plural where the context so indicates.

 

2.1                           “Applicable Laws” means the legal requirements relating to the Plan and the Awards under applicable provisions of the corporate, securities, tax and other laws, rules, regulations and government orders, and the rules of any applicable stock exchange or national market system, of any jurisdiction applicable to Awards granted to residents therein.

 

2.2                           “Award” means an Option, Restricted Share or Restricted Share Unit award granted to a Participant pursuant to the Plan.

 

2.3                           “Award Agreement” means any agreement, contract, or other instrument or document, in writing or through electronic medium, evidencing an Award, including an Option Award Agreement, a Restricted Shares Award Agreement or a Restricted Share Units Award Agreement, each as defined herein.

 

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

 

2.5                           “Code” means the Internal Revenue Code of 1986 of the United States, as amended.

 

2.6                           “Committee” means a committee of the Board described in Article 10.

 

 

2.7                           “Consultant” means any consultant or adviser if: (a) the consultant or adviser renders bona fide services to a Service Recipient; (b) the services rendered by the consultant or adviser are not in connection with the offer or sale of securities in a capital-raising transaction and do not directly or indirectly promote or maintain a market for the Company’s securities; and (c) the consultant or adviser is a natural person who has contracted directly with the Service Recipient to render such services.

 

2.8                           “Corporate Transaction”, unless otherwise defined in an Award Agreement, means any of the following transactions, provided, however, that the Committee shall determine under (d) and (e) whether multiple transactions are related, and its determination shall be final, binding and conclusive:

 

(a)                                 an amalgamation, arrangement or consolidation or scheme of arrangement (i) in which the Company is not the surviving entity, except for a transaction the principal purpose of which is to change the jurisdiction in which the Company is incorporated or (ii) following which the holders of the voting securities of the Company do not continue to hold more than 50% of the combined voting power of the voting securities of the surviving entity;

 

(b)                                 the sale, transfer or other disposition of all or substantially all of the assets of the Company;

 

(c)                                  the complete liquidation or dissolution of the Company;

 

(d)                                 any reverse takeover or series of related transactions culminating in a reverse takeover (including, but not limited to, a tender offer followed by a reverse takeover) in which the Company is the surviving entity but (A) the Company’s equity securities outstanding immediately prior to such takeover are converted or exchanged by virtue of the takeover into other property, whether in the form of securities, cash or otherwise, or (B) in which securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities are transferred to a person or persons different from those who held such securities immediately prior to such takeover or the initial transaction culminating in such takeover, but excluding any such transaction or series of related transactions that the Committee determines shall not be a Corporate Transaction; or

 

(e)                                  acquisition in a single or series of related transactions by any person or related group of persons (other than the Company or by a Company-sponsored employee benefit plan) of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s outstanding securities but excluding any such transaction or series of related transactions that the Committee determines shall not be a Corporate Transaction.

 

2.9                           “Disability”, unless otherwise defined in an Award Agreement,  means that the Participant qualifies to receive long-term disability payments under the Service Recipient’s long-term disability insurance program, as it may be amended from time to time, to which the Participant provides services regardless of whether the Participant is covered by such policy.  If the Service Recipient to which the Participant provides service does not have a long-term disability plan in place, “Disability” means that a Participant is unable to carry out the responsibilities and functions of the position held by the Participant by reason of any

 

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medically determinable physical or mental impairment for a period of not less than ninety (90) consecutive days.  A Participant will not be considered to have incurred a Disability unless he or she furnishes proof of such impairment sufficient to satisfy the Committee in its discretion.

 

2.10                    “Effective Date” shall have the meaning set forth in Section 11.1.

 

2.11                    “Employee” means any person, including an officer or a member of the Board of the Company or any Parent or Subsidiary of the Company, who is in the employment of a Service Recipient, subject to the control and direction of the Service Recipient as to both the work to be performed and the manner and method of performance.  The payment of a director’s fee by a Service Recipient shall not be sufficient to constitute “employment” by the Service Recipient.

 

2.12                    “Exchange Act” means the Securities Exchange Act of 1934 of the United States, as amended.

 

2.13                    “Fair Market Value” means, as of any date, the value of Shares determined as follows:

 

(a)                                 If the Shares are listed on one or more established stock exchanges or national market systems, including without limitation, The New York Stock Exchange, its Fair Market Value shall be the closing sales price for such Shares (or the closing bid, if no sales were reported) as quoted on the principal exchange or system on which the Shares are listed (as determined by the Committee) on the date of determination (or, if no closing sales price or closing bid was reported on that date, as applicable, on the last trading date such closing sales price or closing bid was reported), as reported in The Wall Street Journal or such other source as the Committee deems reliable;

 

(b)                                 If the Shares are regularly quoted on an automated quotation system (including the OTC Bulletin Board) or by a recognized securities dealer, its Fair Market Value shall be the closing sales price for such shares as quoted on such system or by such securities dealer on the date of determination, but if selling prices are not reported, the Fair Market Value of a Share shall be the mean between the high bid and low asked prices for the Shares on the date of determination (or, if no such prices were reported on that date, on the last date such prices were reported), as reported in The Wall Street Journal or such other source as the Committee deems reliable; or

 

(c)                                  In the absence of an established market for the Shares of the type described in (a) and (b), above, the Fair Market Value thereof shall be determined by the Committee in good faith and in its discretion by reference to (i) the placing price of the latest private placement of the Shares and the development of the Company’s business operations and the general economic and market conditions since such latest private placement, (ii) other third party transactions involving the Shares and the development of the Company’s business operation and the general economic and market conditions since such sale, (iii) an independent valuation of 

 

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the Shares, or (iv) such other methodologies or information as the Committee determines to be indicative of Fair Market Value.

 

2.14                    “Incentive Share Option” means an Option that is intended to meet the requirements of Section 422 of the Code or any successor provision thereto.

 

2.15                    “Independent Director” means a member of the Board who is a Non-Employee Director and who meets the standards of independence under The New York Stock Exchange or other applicable stock exchanges where the Company’s Shares are listed.

 

2.16                    “Non-Employee Director” means a member of the Board who qualifies as a “Non-Employee Director” as defined in Rule 16b-3(b)(3) of the Exchange Act, or any successor definition adopted by the Board.

 

2.17                    “Non-Qualified Share Option” means an Option that is not intended to be an Incentive Share Option.

 

2.18                    “Option” means a right granted to a Participant pursuant to Article 5 of the Plan to purchase a specified number of Shares at a specified price during specified time periods.  An Option may be either an Incentive Share Option or a Non-Qualified Share Option.

 

2.19                    “Participant” means a person who, as a member of the Board, Consultant or Employee, has been granted an Award pursuant to the Plan.

 

2.20                    “Parent” means a parent corporation under Section 424(e) of the Code.

 

2.21                    “Permitted Transfer” means the following:

 

(a)                                transfer to the Company or a Subsidiary;

 

(b)                                transfer by gift to “immediate family” as that term is defined in SEC Rule 16a-1(e) promulgated under the U.S. Securities Exchange Act of 1934, as amended;

 

(c)                                 the designation of a beneficiary to receive benefits if the Participant dies or, if the Participant has died, transfers to or exercises by the Participant’s beneficiary, or, in the absence of a validly designated beneficiary, transfers by will or the laws of descent and distribution;

 

(d)                                if the Participant has suffered a disability, permitted transfers or exercises on behalf of the Participant by the Participant’s duly authorized legal representative; or

 

(e)                                 subject to the prior approval of the Committee, transfer to one or more natural persons who are the Participant’s family members or entities owned and controlled by the Participant and/or the Participant’s family members, including but not limited to trusts or other entities whose beneficiaries or beneficial owners are the Participant and/or the Participant’s family members, or to such other persons or entities as may be expressly approved by the Committee, pursuant to such conditions and procedures as the Committee may establish.

 

4

 

2.22                    “Plan” means this Youku Tudou Inc. Share Incentive Plan (formerly named as “Youku Inc. 2010 Share Incentive Plan”), as it may be amended from time to time.

 

2.23                   “Related Entity” means any business, corporation, partnership, limited liability company or other entity in which the Company, a Parent or Subsidiary of the Company holds a substantial ownership interest, directly or indirectly, but which is not a Subsidiary and which the Board designates as a Related Entity for purposes of the Plan.

 

2.24                    “Restricted Share” means a Share awarded to a Participant pursuant to Article 6 that is subject to certain restrictions and may be subject to risk of forfeiture.

 

2.25                    “Restricted Share Unit” means the right granted to a Participant pursuant to Article 7 to receive a Share at a future date.

 

2.26                    “Securities Act” means the Securities Act of 1933 of the United States, as amended.

 

2.27                    “Service Recipient” means the Company, any Parent or Subsidiary of the Company and any Related Entity to which a Participant provides services as an Employee, a Consultant or a Director.

 

2.28                    “Share” means Class A Ordinary Shares, par value US$0.00001 per share, of the Company, and such other securities of the Company that may be substituted for Shares pursuant to Article 9.

 

2.29                    “Subsidiary” means any corporation or other entity of which a majority of the outstanding voting shares or voting power is beneficially owned or controlled directly or indirectly by the Company and which is consolidated into the Company’s consolidated financial statements.

 

2.30                    “Trading Date” means the closing of the first sale to the general public of the Shares pursuant to a registration statement filed with and declared effective by the U.S. Securities and Exchange Commission under the Securities Act.

 

ARTICLE 3

 

SHARES SUBJECT TO THE PLAN

 

3.1                           Number of Shares.

 

(a)                   Subject to the provisions of Article 9 and Section 3.1(b), the maximum aggregate number of Shares which may be issued pursuant to all Awards (including Incentive Share Options) shall be 200,799,784.

 

(b)                   To the extent that an Award terminates, expires, or lapses for any reason, any Shares subject to the Award shall again be available for the grant of an Award pursuant to the Plan.  To the extent permitted by Applicable Laws, Shares issued in assumption of, or in substitution for, any outstanding awards of any entity acquired in any form or combination by the Company or 

 

5

 

any Parent or Subsidiary of the Company shall not be counted against Shares available for grant pursuant to the Plan.  Shares delivered by the Participant or withheld by the Company upon the exercise of any Award under the Plan, in payment of the exercise price thereof or tax withholding thereon, may again be optioned, granted or awarded hereunder, subject to the limitations of Section 3.1(a).  If any Restricted Shares are forfeited by the Participant or repurchased by the Company, such Shares may again be optioned, granted or awarded hereunder, subject to the limitations of Section 3.1(a).  Notwithstanding the provisions of this Section 3.1(b), no Shares may again be optioned, granted or awarded if such action would cause an Incentive Share Option to fail to qualify as an incentive Share option under Section 422 of the Code.

 

3.2                           Shares Distributed.  Any Shares distributed pursuant to an Award may consist, in whole or in part, of authorized and unissued Shares, treasury shares (subject to Applicable Laws) or Shares purchased on the open market.  Additionally, in the discretion of the Committee, American Depository Shares in an amount equal to the number of Shares which otherwise would be distributed pursuant to an Award may be distributed in lieu of Shares in settlement of any Award.  If the number of Shares represented by an American Depository Share is other than on a one-to-one basis, the limitations of Section 3.1 shall be adjusted to reflect the distribution of American Depository Shares in lieu of Shares.

 

ARTICLE 4

 

ELIGIBILITY AND PARTICIPATION

 

4.1                           Eligibility. Persons eligible to participate in this Plan include Employees, Consultants, and all members of the Board, as determined by the Committee.

 

4.2                           Participation.  Subject to the provisions of the Plan, the Committee may, from time to time, select from among all eligible individuals, those to whom Awards shall be granted and shall determine the nature and amount of each Award.  No individual shall have any right to be granted an Award pursuant to this Plan.

 

4.3                           Jurisdictions.  In order to assure the viability of Awards granted to Participants employed in various jurisdictions, the Committee may provide for such special terms as it may consider necessary or appropriate to accommodate differences in local law, tax policy, or custom applicable in the jurisdiction in which the Participant resides or is employed.  Moreover, the Committee may approve such supplements to, or amendments, restatements, or alternative versions of, the Plan as it may consider necessary or appropriate for such purposes without thereby affecting the terms of the Plan as in effect for any other purpose; provided, however, that no such supplements, amendments, restatements, or alternative versions shall increase the share limitations contained in Section 3.1 of the Plan.  Notwithstanding the foregoing, the Committee may not take any actions hereunder, and no Awards shall be granted, that would violate any Applicable Laws.

 

6

 

ARTICLE 5

 

OPTIONS

 

5.1                           General.  The Committee is authorized to grant Options to Participants on the following terms and conditions:

 

(a)                   Exercise Price.  The exercise price per Share subject to an Option shall be determined by the Committee and set forth in the Option Award Agreement which may be a fixed or variable price related to the Fair Market Value of the Shares.  The exercise price per Share  subject to an Option may be amended or adjusted in the absolute discretion of the Committee, the determination of which shall be final, binding and conclusive.  For the avoidance of doubt, to the extent not prohibited by Applicable Laws or any exchange rule, a downward adjustment of the exercise prices of Options mentioned in the preceding sentence shall be effective without the approval of the Company’s shareholders or the approval of the affected Participants.

 

(b)                   Time and Conditions of Exercise.  The Committee shall determine the time or times at which an Option may be exercised in whole or in part, including exercise prior to vesting; provided that the term of any Option granted under the Plan shall not exceed ten years, except as provided in Section 12.1.  The Committee shall also determine any conditions, if any, that must be satisfied before all or part of an Option may be exercised.

 

(c)                    Payment.  The Committee shall determine the methods by which the exercise price of an Option may be paid, the form of payment, including, without limitation (i) cash or check denominated in U.S. Dollars, (ii) to the extent permissible under the Applicable Laws, cash or check in Chinese Renminbi, (iii) cash or check denominated in any other local currency as approved by the Committee, (iv) Shares held for such period of time as may be required by the Committee in order to avoid adverse financial accounting consequences and having a Fair Market Value on the date of delivery equal to the aggregate exercise price of the Option or exercised portion thereof, (v) after the Trading Date the delivery of a notice that the Participant has placed a market sell order with a broker with respect to Shares then issuable upon exercise of the Option, and that the broker has been directed to pay a sufficient portion of the net proceeds of the sale to the Company in satisfaction of the Option exercise price; provided that payment of such proceeds is then made to the Company upon settlement of such sale, (vi) other property acceptable to the Committee with a Fair Market Value equal to the exercise price, or (vii) any combination of the foregoing.  Notwithstanding any other provision of the Plan to the contrary, no Participant who is a member of the Board or an “executive officer” of the Company within the meaning of Section 13(k) of the Exchange Act shall be permitted to pay the exercise price of an Option in any method which would violate Section 13(k) of the Exchange Act.

 

(d)                   Evidence of Grant.  All Options shall be evidenced by an Option Award Agreement between the Company and the Participant.  The Option Award Agreement shall include such additional provisions as may be specified by the Committee.

 

5.2                           Incentive Share Options.  Incentive Share Options may be granted to Employees of the Company, a Parent or Subsidiary of the Company.  Incentive Share Options may not be granted to Employees of a Related Entity or to Independent Directors or Consultants.  The terms of any Incentive Share Options granted pursuant to the Plan, in addition to the requirements of Section 5.1, must comply with the following additional provisions of this Section 5.2:

 

7

 

(a)                   Expiration of Option.  An Incentive Share Option may not be exercised to any extent by anyone after the first to occur of the following events:

 

(i)                                     Ten years from the date it is granted, unless an earlier time is set in the Award Agreement;

 

(ii)                                  90 days after the Participant’s termination of employment as an Employee; and

 

(iii)                               One year after the date of the Participant’s termination of employment or service on account of Disability or death.  Upon the Participant’s Disability or death, any Incentive Share Options exercisable at the Participant’s Disability or death may be exercised by the Participant’s legal representative or representatives, by the person or persons entitled to do so pursuant to the Participant’s last will and testament, or, if the Participant fails to make testamentary disposition of such Incentive Share Option or dies intestate, by the person or persons entitled to receive the Incentive Share Option pursuant to the applicable laws of descent and distribution.

 

(b)                   Individual Dollar Limitation.  The aggregate Fair Market Value (determined as of the time the Option is granted) of all Shares with respect to which Incentive Share Options are first exercisable by a Participant in any calendar year may not exceed $100,000 or such other limitation as imposed by Section 422(d) of the Code, or any successor provision.  To the extent that Incentive Share Options are first exercisable by a Participant in excess of such limitation, the excess shall be considered Non-Qualified Share Options.

 

(c)                    Exercise Price.  The exercise price of an Incentive Share Option shall be equal to the Fair Market Value on the date of grant.  However, the exercise price of any Incentive Share Option granted to any individual who, at the date of grant, owns Shares possessing more than ten percent of the total combined voting power of all classes of shares of the Company may not be less than 110% of Fair Market Value on the date of grant and such Option may not be exercisable for more than five years from the date of grant.

 

(d)                   Transfer Restriction.  The Participant shall give the Company prompt notice of any disposition of Shares acquired by exercise of an Incentive Share Option within (i) two years from the date of grant of such Incentive Share Option or (ii) one year after the transfer of such Shares to the Participant.

 

(e)                    Expiration of Incentive Share Options.  No Award of an Incentive Share Option may be made pursuant to this Plan after the tenth anniversary of the Effective Date.

 

(f)                     Right to Exercise.  During a Participant’s lifetime, an Incentive Share Option may be exercised only by the Participant.

 

8

 

ARTICLE 6

 

RESTRICTED SHARES

 

6.1                           Grant of Restricted Shares.  The Committee, at any time and from time to time, may grant Restricted Shares to Participants as the Committee, in its sole discretion, shall determine.  The Committee, in its sole discretion, shall determine the number of Restricted Shares to be granted to each Participant.

 

6.2                           Restricted Shares Award Agreement.  Each Award of Restricted Shares shall be evidenced by a Restricted Shares Award Agreement that shall specify the period of restriction, the number of Restricted Shares granted, and such other terms and conditions as the Committee, in its sole discretion, shall determine.  Unless the Committee determines otherwise, Restricted Shares shall be held by the Company as escrow agent until the restrictions on such Restricted Shares have lapsed.

 

6.3                           Issuance and Restrictions.  Restricted Shares shall be subject to such restrictions on transferability and other restrictions as the Committee may impose (including, without limitation, limitations on the right to vote Restricted Shares or the right to receive dividends on the Restricted Share).  These restrictions may lapse separately or in combination at such times, pursuant to such circumstances, in such installments, or otherwise, as the Committee determines at the time of the grant of the Award or thereafter.

 

6.4                           Forfeiture/Repurchase.  Except as otherwise determined by the Committee at the time of the grant of the Award or thereafter, upon termination of employment or service during the applicable restriction period, Restricted Shares that are at that time subject to restrictions shall be forfeited or repurchased in accordance with the Restricted Shares Award Agreement; provided, however, the Committee may (a) provide in any Restricted Shares Award Agreement that restrictions or forfeiture and repurchase conditions relating to Restricted Shares will be waived in whole or in part in the event of terminations resulting from specified causes, and (b) in other cases waive in whole or in part restrictions or forfeiture and repurchase conditions relating to Restricted Shares.

 

6.5                           Certificates for Restricted Shares.  Restricted Shares granted pursuant to the Plan may be evidenced in such manner as the Committee shall determine.  If certificates representing Restricted Shares are registered in the name of the Participant, certificates must bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such Restricted Shares, and the Company may, at its discretion, retain physical possession of the certificate until such time as all applicable restrictions lapse.

 

6.6                           Removal of Restrictions.  Except as otherwise provided in this Article 6, Restricted Shares granted under the Plan shall be released from escrow as soon as practicable after the last day of the period of restriction.  The Committee, in its discretion, may accelerate the time at which any restrictions shall lapse or be removed.  After the restrictions have lapsed, the Participant shall be entitled to have any legend or legends under Section 6.5 removed from his or her Share certificate, and the Shares shall be freely transferable by the Participant, subject to applicable legal restrictions.  The Committee, in its discretion, may establish procedures regarding the release of Shares from escrow and the removal of legends, as necessary or appropriate to minimize administrative burdens on the Company.

 

9

 

ARTICLE 7

 

RESTRICTED SHARE UNITS

 

7.1                           Grant of Restricted Share Units.  The Committee, at any time and from time to time, may grant Restricted Share Units to Participants as the Committee, in its sole discretion, shall determine.  The Committee, in its sole discretion, shall determine the number of Restricted Share Units to be granted to each Participant.

 

7.2                           Restricted Share Units Agreement.  Each Award of Restricted Share Units shall be evidenced by a Restricted Share Units Award Agreement that shall specify any vesting conditions, the number of Restricted Share Units granted, and such other terms and conditions as the Committee, in its sole discretion, shall determine.

 

7.3                           Performance Objectives and Other Terms.  The Committee, in its discretion, shall set performance objectives or other vesting criteria which, depending on the extent to which they are met, will determine the number or value of Restricted Share Units that will be paid out to the Participants.

 

7.4                           Form and Timing of Payment of Restricted Share Units.  At the time of grant, the Committee shall specify the date or dates on which the Restricted Share Units shall become fully vested and nonforfeitable.  Upon vesting, the Committee, in its sole discretion, may pay Restricted Share Units in the form of cash, in Shares or in a combination thereof.

 

7.5                           Forfeiture/Repurchase.  Except as otherwise determined by the Committee at the time of the grant of the Award or thereafter, upon termination of employment or service during the applicable restriction period, Restricted Share Units that are at that time unvested shall be forfeited or repurchased in accordance with the Restricted Share Units Award Agreement; provided, however, the Committee may (a) provide in any Restricted Share Units Award Agreement that restrictions or forfeiture and repurchase conditions relating to Restricted Share Units will be waived in whole or in part in the event of terminations resulting from specified causes, and (b) in other cases waive in whole or in part restrictions or forfeiture and repurchase conditions relating to Restricted Share Units.

 

ARTICLE 8

 

PROVISIONS APPLICABLE TO AWARDS

 

8.1                           Award Agreement.  Awards under the Plan shall be evidenced by Award Agreements that set forth the terms, conditions and limitations for each Award which may include the term of an Award, the provisions applicable in the event the Participant’s employment or service terminates, and the Company’s authority to unilaterally or bilaterally amend, modify, suspend, cancel or rescind an Award.

 

8.2                           Limits on Transfer.  Except for a Permitted Transfer or as otherwise expressly approved by the Committee, no right or interest of a Participant in any Award may be pledged, encumbered, or hypothecated to or in favor of any party other than the Company or a Subsidiary, or shall be subject to any lien, obligation, or liability of such Participant to any other party. Any 

 

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Permitted Transfer shall be subject to the condition that the Committee receive evidence satisfactory to it that the transfer is being made for the purposes set forth of the definition of “Permitted Transfer” in Section 2.21 hereof and on a basis consistent with the Company’s lawful issue of securities.

 

8.3                           Beneficiaries.  Notwithstanding Section 8.2, a Participant may, in the manner determined by the Committee, designate a beneficiary to exercise the rights of the Participant and to receive any distribution with respect to any Award upon the Participant’s death.  A beneficiary, legal guardian, legal representative, or other person claiming any rights pursuant to the Plan is subject to all terms and conditions of the Plan and any Award Agreement applicable to the Participant, except to the extent the Plan and Award Agreement otherwise provide, and to any additional restrictions deemed necessary or appropriate by the Committee.  If the Participant is married and resides in a community property state, a designation of a person other than the Participant’s spouse as his or her beneficiary with respect to more than 50% of the Participant’s interest in the Award shall not be effective without the prior written consent of the Participant’s spouse.  If no beneficiary has been designated or survives the Participant, payment shall be made to the person entitled thereto pursuant to the Participant’s will or the laws of descent and distribution.  Subject to the foregoing, a beneficiary designation may be changed or revoked by a Participant at any time provided the change or revocation is filed with the Committee.

 

8.4                           Share Certificates.  Notwithstanding anything herein to the contrary, the Company shall not be required to issue or deliver any certificates evidencing shares of the Share pursuant to the exercise of any Award, unless and until the Committee has determined, with advice of counsel, that the issuance and delivery of such certificates is in compliance with all Applicable Laws, regulations of governmental authorities and, if applicable, the requirements of any exchange on which the Shares are listed or traded.  All Share certificates delivered pursuant to the Plan are subject to any stop-transfer orders and other restrictions as the Committee deems necessary or advisable to comply with all Applicable Laws, and the rules of The New York Stock Exchange or any other national securities exchange or automated quotation system where the Shares are listed, quoted, or traded.  The Committee may place legends on any Share certificate to reference restrictions applicable to the Shares.  In addition to the terms and conditions provided herein, the Committee may require that a Participant make such reasonable covenants, agreements, and representations as the Committee, in its discretion, deems advisable in order to comply with any such laws, regulations, or requirements. The Committee shall have the right to require any Participant to comply with any timing or other restrictions with respect to the settlement or exercise of any Award, including a window-period limitation, as may be imposed in the discretion of the Committee.

 

8.5                           Paperless Administration.  Subject to Applicable Laws, the Committee may make Awards, provide applicable disclosure and procedures for exercise of Awards by an internet website or interactive voice response system for the paperless administration of Awards.

 

8.6                           Foreign Currency.  A Participant may be required to provide evidence that any currency used to pay the exercise price of any Award were acquired and taken out of the jurisdiction in which the Participant resides in accordance with Applicable

 

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Laws, including foreign exchange control laws and regulations.  In the event the exercise price for an Award is paid in Chinese Renminbi or other foreign currency, as permitted by the Committee, the amount payable will be determined by conversion from U.S. dollars at the official rate promulgated by the People’s Bank of China for Chinese Renminbi, or for jurisdictions other than the People’s Republic of China, the exchange rate as selected by the Committee on the date of exercise.

 

ARTICLE 9

 

CHANGES IN CAPITAL STRUCTURE

 

9.1                           Adjustments.  In the event of any dividend, share split, combination or exchange of Shares, amalgamation, arrangement or consolidation, spin-off, recapitalization or other distribution (other than normal cash dividends) of Company assets to its shareholders, or any other change affecting Shares or the price of a Share, the Committee shall make such proportionate adjustments, if any, as the Committee in its discretion may deem appropriate to reflect such change with respect to (a) the aggregate number and type of shares that may be issued under the Plan (including, but not limited to, adjustments of the limitations in Section 3.1); (b) the terms and conditions of any outstanding Awards (including, without limitation, any applicable performance targets or criteria with respect thereto); and (c) the grant or exercise price per share for any outstanding Awards under the Plan.

 

9.2                           Corporate Transactions.  Except as may otherwise be provided in any Award Agreement or any other written agreement entered into by and between the Company and a Participant, if the Committee anticipates the occurrence, or upon the occurrence, of a Corporate Transaction, the Committee may, in its sole discretion, provide for (i) any and all Awards outstanding hereunder to terminate at a specific time in the future and shall give each Participant the right to exercise the vested portion of such Awards during a period of time as the Committee shall determine, or (ii) the purchase of any Award for an amount of cash equal to the amount that could have been attained upon the exercise of such Award (and, for the avoidance of doubt, if as of such date the Committee determines in good faith that no amount would have been attained upon the exercise of such Award, then such Award may be terminated by the Company without payment), or (iii) the replacement of such Award with other rights or property selected by the Committee in its sole discretion or the assumption of or substitution of such Award by the successor or surviving corporation, or a Parent or Subsidiary thereof, with appropriate adjustments as to the number and kind of Shares and prices, or (iv) payment of Award in cash based on the value of Shares on the date of the Corporate Transaction plus reasonable interest on the Award through the date when such Award would otherwise be vested or have been paid in accordance with its original terms, if necessary to comply with Section 409A of the Code.

 

9.3                           Outstanding Awards — Other Changes.  In the event of any other change in the capitalization of the Company or corporate change other than those specifically referred to in this Article 9, the Committee may, in its absolute discretion, make such adjustments in the number and class of shares subject to Awards outstanding on the date on which such change occurs and in

 

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the per share grant or exercise price of each Award as the Committee may consider appropriate to prevent dilution or enlargement of rights.

 

9.4                           No Other Rights.  Except as expressly provided in the Plan, no Participant shall have any rights by reason of any subdivision or consolidation of Shares of any class, the payment of any dividend, any increase or decrease in the number of shares of any class or any dissolution, liquidation, merger, or consolidation of the Company or any other corporation.  Except as expressly provided in the Plan or pursuant to action of the Committee under the Plan, no issuance by the Company of shares of any class, or securities convertible into shares of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number of shares subject to an Award or the grant or exercise price of any Award.

 

ARTICLE 10

 

ADMINISTRATION

 

10.1                    Committee.  The Plan shall be administered by the Board or a committee of one or more members of the Board (the “Committee”) to whom the Board shall delegate the authority to grant or amend Awards to Participants other than any of the Committee members.  Any grant or amendment of Awards to any Committee member shall then require an affirmative vote of a majority of the Board members who are not on the Committee.

 

10.2                    Action by the Committee.  A majority of the Committee shall constitute a quorum.  The acts of a majority of the members present at any meeting at which a quorum is present, and acts approved in writing by a majority of the Committee in lieu of a meeting, shall be deemed the acts of the Committee.  Each member of the Committee is entitled to, in good faith, rely or act upon any report or other information furnished to that member by any officer or other employee of the Company or any Subsidiary, the Company’s independent certified public accountants, or any executive compensation consultant or other professional retained by the Company to assist in the administration of the Plan.

 

10.3                    Authority of Committee.  Subject to any specific designation in the Plan, the Committee has the exclusive power, authority and discretion to:

 

(a)                                 Designate Participants to receive Awards;

 

(b)                                 Determine the type or types of Awards to be granted to each Participant;

 

(c)                                  Determine the number of Awards to be granted and the number of Shares to which an Award will relate;

 

(d)                                 Determine the terms and conditions of any Award granted pursuant to the Plan, including, but not limited to, the exercise price, grant price, or purchase price, any restrictions or limitations on the Award, any schedule for lapse of forfeiture restrictions or restrictions on the exercisability of an Award, and accelerations or waivers thereof, any provisions related to non-competition and recapture of gain on an Award, based in each case on such considerations as the Committee in its sole discretion determines;

 

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(e)                                  Determine whether, to what extent, and pursuant to what circumstances an Award may be settled in, or the exercise price of an Award may be paid in, cash, Shares, other Awards, or other property, or an Award may be canceled, forfeited, or surrendered;

 

(f)                                   Prescribe the form of each Award Agreement, which need not be identical for each Participant;

 

(g)                                  Decide all other matters that must be determined in connection with an Award;

 

(h)                                 Establish, adopt, or revise any rules and regulations as it may deem necessary or advisable to administer the Plan;

 

(i)                                     Interpret the terms of, and any matter arising pursuant to, the Plan or any Award Agreement; and

 

(j)                                    Make all other decisions and determinations that may be required pursuant to the Plan or as the Committee deems necessary or advisable to administer the Plan.

 

10.4                    Decisions Binding.  The Committee’s interpretation of the Plan, any Awards granted pursuant to the Plan, any Award Agreement and all decisions and determinations by the Committee with respect to the Plan are final, binding, and conclusive on all parties.

 

ARTICLE 11

 

EFFECTIVE AND EXPIRATION DATE

 

11.1                    Effective Date.  The Plan is effective as of the date the Plan is adopted and approved by the shareholders of the Company (the “Effective Date”).  The Plan will be deemed to be approved by the shareholders if it receives the affirmative vote of the holders of a majority of the share capital of the Company present or represented and entitled to vote at a meeting duly held in accordance with the applicable provisions of the Company’s Memorandum of Association and Articles of Association.

 

11.2                    Expiration Date.  The Plan will expire on, and no Award may be granted pursuant to the Plan after, the tenth anniversary of the Effective Date.  Any Awards that are outstanding on the tenth anniversary of the Effective Date shall remain in force according to the terms of the Plan and the applicable Award Agreement.

 

ARTICLE 12

 

AMENDMENT, MODIFICATION, AND TERMINATION

 

12.1                    Amendment, Modification, And Termination.  With the approval of the Board, at any time and from time to time, the Committee may terminate, amend or modify the Plan; provided, however, that (a) to the extent necessary and desirable to comply with Applicable Laws, or stock exchange rules, the Company shall obtain shareholder approval of any Plan amendment in

 

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such a manner and to such a degree as required, unless the Company decides to follow home country practice, and (b) unless the Company decides to follow home country practice, shareholder approval is required for any amendment to the Plan that (i) increases the number of Shares available under the Plan (other than any adjustment as provided by Article 9), (ii) permits the Committee to extend the term of the Plan or the exercise period for an Option beyond ten years from the date of grant, or (iii) results in a material increase in benefits or a change in eligibility requirements.

 

12.2                    Awards Previously Granted.  Except with respect to amendments made pursuant to Section 12.1, no termination, amendment, or modification of the Plan shall adversely affect in any material way any Award previously granted pursuant to the Plan without the prior written consent of the Participant.

 

ARTICLE 13

 

GENERAL PROVISIONS

 

13.1                    No Rights to Awards.  No Participant or other person shall have any claim to be granted any Award pursuant to the Plan, and neither the Company nor the Committee is obligated to treat Participants and other persons uniformly.

 

13.2                    No Shareholders Rights.  No Award gives the Participant any of the rights of a shareholder of the Company unless and until Shares are in fact issued to such person in connection with such Award.

 

13.3                    Taxes.  No Shares shall be delivered under the Plan to any Participant until such Participant has made arrangements acceptable to the Committee for the satisfaction of any income and employment tax withholding obligations under Applicable Laws.  The Company or any Subsidiary shall have the authority and the right to deduct or withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy all applicable taxes (including the Participant’s payroll tax obligations) required or permitted by law to be withheld with respect to any taxable event concerning a Participant arising as a result of this Plan.  The Committee may in its discretion and in satisfaction of the foregoing requirement allow a Participant to elect to have the Company withhold Shares otherwise issuable under an Award (or allow the return of Shares) having a Fair Market Value equal to the sums required to be withheld.  Notwithstanding any other provision of the Plan, the number of Shares which may be withheld with respect to the issuance, vesting, exercise or payment of any Award (or which may be repurchased from the Participant of such Award after such Shares were acquired by the Participant from the Company) in order to satisfy any income and payroll tax liabilities applicable to the Participant with respect to the issuance, vesting, exercise or payment of the Award shall, unless specifically approved by the Committee, be limited to the number of Shares which have a Fair Market Value on the date of withholding or repurchase equal to the aggregate amount of such liabilities based on the minimum statutory withholding rates for the applicable income and payroll tax purposes that are applicable to such supplemental taxable income.

 

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13.4                    No Right to Employment or Services.  Nothing in the Plan or any Award Agreement shall interfere with or limit in any way the right of the Service Recipient to terminate any Participant’s employment or services at any time, nor confer upon any Participant any right to continue in the employ or service of any Service Recipient.

 

13.5                    Unfunded Status of Awards.  The Plan is intended to be an “unfunded” plan for incentive compensation.  With respect to any payments not yet made to a Participant pursuant to an Award, nothing contained in the Plan or any Award Agreement shall give the Participant any rights that are greater than those of a general creditor of the Company or any Subsidiary.

 

13.6                   Indemnification.  To the extent allowable pursuant to applicable law, each member of the Committee or of the Board shall be indemnified and held harmless by the Company from any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by such member 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 or failure to act pursuant to the Plan and against and from any and all amounts paid by him or her in satisfaction of judgment in such action, suit, or proceeding against him or her; provided he or she gives 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 pursuant to the Company’s Memorandum of Association and Articles of Association, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them harmless.

 

13.7                    Relationship to Other Benefits.  No payment pursuant to the Plan shall be taken into account in determining any benefits pursuant to any pension, retirement, savings, profit sharing, group insurance, welfare or other benefit plan of the Company or any Subsidiary except to the extent otherwise expressly provided in writing in such other plan or an agreement thereunder.

 

13.8                    Expenses.  The expenses of administering the Plan shall be borne by the Company and its Subsidiaries.

 

13.9                    Titles and Headings.  The titles and headings of the Sections in the Plan are for convenience of reference only and, in the event of any conflict, the text of the Plan, rather than such titles or headings, shall control.

 

13.10             Fractional Shares.  No fractional Shares shall be issued and the Committee shall determine, in its discretion, whether cash shall be given in lieu of fractional Shares or whether such fractional Shares shall be eliminated by rounding up or down as appropriate.

 

13.11             Limitations Applicable to Section 16 Persons.  Notwithstanding any other provision of the Plan, the Plan, and any Award granted or awarded to any Participant who is then subject to Section 16 of the Exchange Act, shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule.  To the extent permitted by

 

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the Applicable Laws, the Plan and Awards granted or awarded hereunder shall be deemed amended to the extent necessary to conform to such applicable exemptive rule.

 

13.12             Government and Other Regulations.  The obligation of the Company to make payment of awards in Share or otherwise shall be subject to all Applicable Laws, and to such approvals by government agencies as may be required.  The Company shall be under no obligation to register any of the Shares paid pursuant to the Plan under the Securities Act or any other similar law in any applicable jurisdiction.  If the Shares paid pursuant to the Plan may in certain circumstances be exempt from registration pursuant to the Securities Act or other Applicable Laws, the Company may restrict the transfer of such Shares in such manner as it deems advisable to ensure the availability of any such exemption.

 

13.13             Governing Law.  The Plan and all Award Agreements shall be construed in accordance with and governed by the laws of the Cayman Islands.

 

13.14             Section 409A.  To the extent that the Committee determines that any Award granted under the Plan is or may become subject to Section 409A of the Code, the Award Agreement evidencing such Award shall incorporate the terms and conditions required by Section 409A of the Code.  To the extent applicable, the Plan and the Award Agreements shall be interpreted in accordance with Section 409A of the Code and the U.S. Department of Treasury regulations and other interpretative guidance issued thereunder, including without limitation any such regulation or other guidance that may be issued after the Effective Date.  Notwithstanding any provision of the Plan to the contrary, in the event that following the Effective Date the Committee determines that any Award may be subject to Section 409A of the Code and related Department of Treasury guidance (including such Department of Treasury guidance as may be issued after the Effective Date), the Committee may adopt such amendments to the Plan and the applicable Award agreement or adopt other policies and procedures (including amendments, policies and procedures with retroactive effect), or take any other actions, that the Committee determines are necessary or appropriate to (a) exempt the Award from Section 409A of the Code and /or preserve the intended tax treatment of the benefits provided with respect to the Award, or (b) comply with the requirements of Section 409A of the Code and related U.S. Department of Treasury guidance.

 

13.15             Appendices.  The Committee may approve such supplements, amendments or appendices to the Plan as it may consider necessary or appropriate for purposes of compliance with applicable laws or otherwise and such supplements, amendments or appendices shall be considered a part of the Plan; provided, however, that no such supplements shall increase the share limitation contained in Section 3.1 of the Plan without the approval of the Board.

 

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