Document:

exhibit101-03312022

              Ameriprise Financial, Inc.  2007 Long-Term Incentive Award Program Guide (U.S.  and India)  This Guide is available on Inside for awards granted in January 2007 and forward.                                                            THIS DOCUMENT IS PART OF A PROSPECTUS COVERING SECURITIES THAT HAVE BEEN  REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933.      Revision: March 2022  

 

1   Contents  Long-Term Incentive Award Program ............................................................................................................................ 2  LTIA Program Overview .............................................................................................................................................. 2  Summary of the Types of Awards under the Plan ....................................................................................................... 3  Restricted Stock Awards ................................................................................................................................................ 4  Valuing RSA Grants .................................................................................................................................................... 4  Vesting ........................................................................................................................................................................ 4  Quarterly dividends ...................................................................................................................................................... 4  Treatment of RSAs upon Certain Events .................................................................................................................... 4  Restricted Stock Units ................................................................................................................................................... 4  Valuing RSU Grants .................................................................................................................................................... 5  Vesting ........................................................................................................................................................................ 5  Quarterly Dividend Equivalents ................................................................................................................................... 5  Treatment of RSUs upon Certain Events .................................................................................................................... 5  Non-Qualified Stock Options .......................................................................................................................................... 5  Valuing NQSO Grants ................................................................................................................................................. 5  Vesting ........................................................................................................................................................................ 6  Steps for Exercising NQSOs ....................................................................................................................................... 6  Treatment of NQSOs upon Certain Events ................................................................................................................. 8  Performance Stock Units (for executive officers only) ................................................................................................... 8  Performance Cash Units ................................................................................................................................................ 8  Tax Implications for LTIAs (U.S. only) ........................................................................................................................... 8  RSAs and RSUs: Income & Employment Tax Implications ......................................................................................... 9  NQSOs: Income and Employment Tax Implications ................................................................................................... 9  Multi-State Taxation Process .................................................................................................................................... 10  Section 409A of the Code .......................................................................................................................................... 10  Treatment of LTIAs upon Certain Events .................................................................................................................... 11  Part-Time Employment Status................................................................................................................................... 11  Employment Termination ........................................................................................................................................... 11  Leave of Absence...................................................................................................................................................... 12  Death ......................................................................................................................................................................... 12  Disability Termination ................................................................................................................................................. 12  Retirement ................................................................................................................................................................. 12  Transfer between Business Segments ...................................................................................................................... 13  Transfer from Field Eligible Employee to Franchise Advisor ..................................................................................... 13  Situations of Detrimental Conduct .............................................................................................................................. 13  Compensation Recovery or “Clawback” Policy (For executive officers only) ............................................................ 13  Change in Control of the Company ........................................................................................................................... 14  Payments to Certain U.S. Taxpayers upon a Change in Control of the Company .................................................... 14  Resale of Shares Received Under the Plan .............................................................................................................. 15  Major Terms and Conditions of NQSOs, RSAs and RSUs.......................................................................................... 15  Non-Qualified Stock Options ...................................................................................................................................... 15  Restricted Stock Awards and Restricted Stock Units ................................................................................................ 16  Administrative Information about this Guide ................................................................................................................ 16  About this Guide ........................................................................................................................................................ 16  About the Illustrations ................................................................................................................................................ 17  Award Confirmation Materials ................................................................................................................................... 17  Governing Award Documents ................................................................................................................................... 17  AMP Shares Available for Grant under the Plan ....................................................................................................... 17  Plan Administration ................................................................................................................................................... 18  Performance-Based Compensation ............................................................................................................................ 18  Adjustments upon Changes in Capitalization ............................................................................................................ 18  Tax Withholding ......................................................................................................................................................... 19  Assignment and Transfer .......................................................................................................................................... 19  Amendment ............................................................................................................................................................... 19  Term of the Plan ........................................................................................................................................................ 19  Resources ................................................................................................................................................................... 19  Availability of Certain Information and Incorporation of Documents by Reference .................................................... 19  Contact Information ................................................................................................................................................... 20  

 

2   Long-Term Incentive Award Program  The Long-Term Incentive Award (“LTIA”) program is designed to align Participants’ interests with those of the  shareholders of Ameriprise Financial, Inc. (the “Company”). By providing a stake in the Company’s future success, LTIAs  are considered essential to our efforts to attract and retain talented employees.    LTIAs are equity-based or cash-based incentive awards (i.e., non-qualified stock options, restricted stock awards,  restricted stock units, performance cash units, performance stock units and other equity-based awards) issued pursuant  to the Ameriprise Financial 2005 Incentive Compensation Plan, as amended and restated (the “Plan”). All LTIAs are  recommended for approval by the Compensation and Benefits Committee (the “Committee”) of the Company’s Board of  Directors (the “Board”) or the Committee’s duly authorized delegate. The timing and process for approval and issuance of  such awards will be governed by the Ameriprise Financial Long-Term Incentive Award Policy – Grant Practices and  Procedures. Once the recommended awards are approved and granted, they are then communicated to employees by  their leaders, as well as by email notification.    LTIA Program Overview    Restricted Stock Awards (“RSAs”), Non-qualified Stock Options (“NQSOs”), Restricted Stock Unit Awards (“RSUs”),  Performance Stock Units (“PSUs”) and Performance Cash Units (“PCUs”) (collectively, “Awards” or “LTIAs”) are issued  pursuant to the terms of the Plan at the discretion and subject to the administration of the Committee.    All Awards issued under the Plan will contain the general terms set forth in the applicable provisions of this 2007 Long-  Term Incentive Award Program Guide (this “Guide”). The specific terms of an individual Award will be contained in the  Shareworks online award agreement or certificate delivered to the Participant in connection with the grant of an Award. All  Awards are subject to the terms and conditions of the Plan, the Guide, and the Award detail, as well as any administrative  guidelines or interpretations by the Committee under the Plan, and any such guidelines or interpretations are hereby  incorporated into this Guide by reference and made a part of this Guide. PSUs and PCUs will also be subject to the terms  and conditions of the PSU Supplement to this Guide or the PCU Supplement to this Guide, as applicable.    The Plan provides that Awards may be settled in cash and/or in shares of Company common stock (“AMP Shares”) or  other property; however, the medium of settlement for an individual Award will be contained in the Award certificate. As  used in this Guide, the term “shares” refers to the common shares of the Company having a par value of $.01 per share,  or the shares of any other stock of any other class into which such shares may thereafter be changed.    The chart on the following page summarizes the key features of the types of awards granted under the LTIA program.  This Guide describes awards management expects to recommend for grant and may not cover the specific features of  every award. However, this Guide is intended to cover the terms of the vast majority of Awards, and you may generally  rely on it for the governance of your awards unless the Company communicates something different to you in writing.    If the type of awards granted changes from what is described in this Guide, the LTIA Administration Group will provide you  with detailed information regarding any changes. Detailed information about various award types, tax implications and  other award features is contained in the following sections.  

 

3   Summary of the Types of Awards under the Plan    This section summarizes general features of RSAs, NQSOs, RSUs, PSUs and PCUs. Detailed information about the  various Award types is contained in sections that follow.     RSA NQSO RSU PSU and PCU  Intent and Form  of Award  A grant of AMP Shares  in which the  Participant’s rights in  the shares are restricted  and such shares are  nontransferable until  they vest.  The opportunity to purchase  (or exercise) a specific  number of AMP Shares after  the award vests. NQSOs, to  the extent vested and subject  to other Award requirements,  may be exercised while  continuously employed1, but  in no event later than 10 years  after the grant date.  A contractual right  to deliver AMP  Shares when the  Award vests.  A contractual right to deliver a number of  AMP Shares (for a PSU, or, in the case of  a PCU, an amount of cash) based on  attainment of the applicable performance  conditions over the applicable performance  period.  Size of Grant Generally, the dollar  value of the award is  converted to a specific  number of AMP Shares  (at fair market value) on  the grant date.  Generally, a Black-Scholes  valuation model is used to  convert the dollar value of the  award to a specific number  NQSOs on the grant date.  Generally, the  dollar value of the  award is converted  to a specific  number of AMP  Shares (at fair  market value) on  the grant date.  For PSUs, the number of AMP shares  distributable is determined pursuant to your  applicable Award details in the same  manner as RSAs. For PCUs, the amount of  cash payable at target is the dollar value of  the award.  Vesting  Schedule2  Generally, will vest in  equal installments over  a three-year period, or  according to such other  vesting schedule  specified in the Award  detail.  Generally, will vest in equal  installments over a three-year  period, or according to such  other vesting schedule  specified in the Award detail.  Generally, will vest  in equal  installments over a  three-year period,  or according to  such other vesting  schedule specified  in the Award detail.  The performance period for a PSU or a  PCU is generally three years. Awards  generally “cliff vest” at the end of the  performance period and become payable  no later than the following March 15th,  after the payout for that period has been  determined.  Dividends/  Dividend  Equivalents  Quarterly dividends, if  and to the extent  declared, will be paid in  cash during the vesting  period.  An NQSO, whether vested or  unvested, is not entitled to  dividends or dividend  equivalents.  Quarterly dividend  equivalents, if and  to the extent  declared, will be  paid in cash  during the vesting  period.  Each PSU earned will be entitled to a cash  payment equal to the amount of any  dividends declared and paid during the  performance period and through the  payment date. Any such dividend  equivalent payment will vest and be paid at  the same time as the underlying PSU.  PCUs are not entitled to dividends or  dividend equivalents.  Voting Rights  for Unvested  AMP Shares  Yes. No. No. No.  Income &  Employment  Taxation  (U.S. only)  Generally, taxable upon  vesting of the AMP  Shares.  Taxable upon exercise of the  NQSO.  Generally, taxable  upon delivery of  the AMP Shares  (note: FICA taxes  may be payable  and withheld  before an RSU  vests and AMP  Shares delivered).  Generally, taxable upon delivery of the  AMP Shares or, in the case of a PCU,  cash.            1 Continuous employment with the Company or one of its subsidiaries is required through the date of exercise of the NQSO, provided that in  certain situations, exercise may be permitted for a limited period following termination of employment (but in no event later than 10 years  after the grant date), as set forth in this Guide under “Treatment of LTIAs upon Certain Events.”  2 Continuous employment is required through each vesting date unless an exception is set forth in this Guide under “Treatment of LTIAs  upon Certain Events.”  

 

4   Restricted Stock Awards  An RSA is a grant of AMP Shares. On the date of grant, your rights to the shares are restricted and you may not sell,  assign, or otherwise transfer the shares until they vest, which is contingent upon you remaining employed with the  Company or one of its subsidiaries through each vesting date. Once vested, you receive the AMP Shares free from such  restrictions. Quarterly dividends, if any, are paid on your unvested AMP Shares during the vesting period. You have full  voting rights for all your unvested AMP Shares.    Valuing RSA Grants    The value of an RSA share at vesting is equal to the Company’s closing share price as reported on the New York Stock  Exchange on the vesting date, or if there is no reported closing price on the vesting date, then the closing price as  reported by the New York Stock Exchange on the last previous day on which such closing price was reported. For  example, if 150 restricted AMP Shares vest in January and the closing AMP Share price at vesting is $85, the pretax  value of these AMP Shares would be $12,750 ($85 x 150 = $12,750). (See the “About the Illustrations” section in this  Guide for an important disclosure.)    Vesting    RSAs generally vest in equal installments over a three-year period, starting with the first anniversary of the grant date and  ending on the third anniversary of the grant date. The Award detail you receive with your RSA will include a personalized  vesting schedule.    Upon a vesting date, the restrictions will lapse on the number of AMP Shares specified in your Award to vest on such  date. Any required tax withholding will be paid by withholding AMP Shares from the number of shares that vest on such  date. The net AMP Shares that will be in your account following vesting will be the number of AMP Shares specified in  your Award to vest on such date less the number of AMP Shares necessary to satisfy any tax withholding requirements.  Once the restrictions have lapsed and the required tax withholdings have been satisfied, you may sell, assign, or  otherwise transfer your AMP Shares at any time, subject to securities laws governing insider trading, short-swing profit  rules and Company stock ownership and retention guidelines and black-out periods. You are responsible for knowing  and abiding by the applicable laws and Company policies regarding your stock and stock-based awards.    Quarterly dividends    Cash dividends paid on AMP Shares, as declared by the Board, are paid quarterly during the vesting period. The dividend  payment amount is determined each quarter and stated as a per-share amount that is multiplied by the number of  unvested AMP Shares in your award. For example, if a quarterly dividend is $0.45 per share and you have 500 unvested  AMP Shares, your quarterly dividend payment would equal $225 ($0.45 x 500 = $225).    To change the address where your dividend check is mailed, to request a dividend check replacement or to set-up  electronic payment, contact the Transfer Agent, Broadridge. Contact information can be found in the “Contact Information”  section in this Guide.    Treatment of RSAs upon Certain Events    For information on the treatment of RSAs upon retirement, employment termination, leave of absence, etc., please see  the “Treatment of LTIAs upon Certain Events” section in this Guide.      Restricted Stock Units  Under an RSU, AMP Shares are not issued to you on the grant date. Instead, an RSU represents the Company’s  contractual obligation to issue a specified number of AMP Shares to you at the end of the vesting period applicable to  your Award. During this period, you receive quarterly dividend equivalent payments that are the equivalent value of any  AMP Share dividends that are declared and paid during such calendar quarter. Any such dividend equivalents will be paid  to you as soon as practicable following the payment to shareholders of the related dividend, but in no event later than 75  days following such date. You do not have voting rights for shares under any unvested portion of the RSU until such  shares become vested and are issued to you.  

 

5   Valuing RSU Grants    RSUs are valued in the same manner as RSAs. The value of an RSU share at vesting is equal to the Company’s closing  share price as reported on the New York Stock Exchange composite tape on the vesting date or if there is no reported  closing price on the vesting date, then the closing price as reported by the New York Stock Exchange on the last previous  day on which such closing price was reported. For example, if 150 restricted AMP Shares vest in January and the closing  AMP Share price at vesting is $85, the pretax value of these AMP Shares would be $12,750 ($85 x 150 = $12,750). (See  the “About the Illustrations” section in this Guide for an important disclosure.)      Vesting    RSUs generally vest in equal installments over a three-year period, starting with the first anniversary of the grant date and  ending on the third anniversary of the grant date. The Award detail you receive with your RSU will include a personalized  vesting schedule.    Upon a vesting date, the restrictions will lapse on the number of AMP Shares specified in your Award to vest on such  date. Any required tax withholding will be paid by withholding AMP Shares from the number of shares that vest on such  date. The net AMP Shares that will be in your account following vesting will be the number of AMP Shares specified in  your Award detail to vest on such date less the number of AMP Shares necessary to satisfy any tax withholding  requirements. Once the restrictions have lapsed and the required tax withholdings have been satisfied, you may sell your  AMP Shares at any time, subject to securities laws governing insider trading, short- swing profit rules and Company stock  ownership and retention guidelines and black-out periods. You are responsible for knowing and abiding by the  applicable laws and Company policies regarding your stock and stock-based awards.    As explained in greater detail in the section in this Guide titled “RSAs and RSUs: Income & Employment Tax  Implications,” please note that in some instances FICA (Social Security and Medicare) taxes may be payable before an  Award vests and you receive AMP Shares.    Quarterly Dividend Equivalents    Unlike RSAs, RSUs are not entitled to receive payment of any AMP Share dividends, as declared by the Board, during the  vesting period. However, RSUs are entitled to receive a dividend equivalent payment from the Company equal to the  amount of the AMP Share dividends that are paid to shareholders during the vesting period. For example, if a quarterly  dividend is $0.45 per share and you have 500 unvested AMP Shares, your quarterly dividend equivalent payment would  equal $225 ($0.45 x 500 = $225).      Treatment of RSUs upon Certain Events    For information about how your RSUs will be treated upon certain events, such as retirement, employment termination,  leave of absence, etc., please see “Treatment of LTIAs upon Certain Events.”      Non-Qualified Stock Options  An NQSO gives you the right to purchase a specified number of AMP Shares at the exercise price set forth in the Award,  subject to continuous employment and other vesting requirements and exercise period limitations. The exercise price is  equal to the closing stock price as reported on the New York Stock Exchange composite tape on the grant date. Once an  NQSO becomes vested, you determine when to exercise the option (before its expiration) and how to pay for the option  exercise. Unless your Award detail provides otherwise, an NQSO expires on the date that is 10 years after the date of  grant, or upon your earlier termination of employment with the Company or one of its subsidiaries, provided that in certain  situations, you may be permitted to exercise the NQSO for a limited period following termination of employment and prior  to its award expiration date (please see the “Treatment of LTIAs upon Certain Events” section in this Guide). “Non-  qualified” refers to the tax treatment of the option under the U.S. Internal Revenue Code of 1986, as amended (the  “Code”).    Valuing NQSO Grants    NQSOs earn value if the Company’s stock price increases above the exercise price. Once an NQSO becomes vested,  

 

6   you have the right to pay the exercise price to exercise the option and acquire the AMP Shares. For example, assume  that 500 vested NQSOs were granted at the exercise price of $50 per share and the price of an AMP Share increases to  $75. If you decided to exercise the NQSO, the pre-tax gain on these options would be $12,500 (($75 - $50 = $25) x 500 =  $12,500). (See the “About the Illustrations” section in this Guide for an important disclosure.)    Vesting    NQSOs generally become vested and available for exercise in equal installments over a three-year period, starting with  the first anniversary of the grant date and ending on the third anniversary of the grant date. The Award detail you receive  in connection with an NQSO grant will include a personalized vesting schedule.    Steps for Exercising NQSOs    (These steps are for U.S. employees; exercise steps outside the United States may differ due to local requirements.)  Generally, you may exercise the vested portion of an NQSO as soon as it vests or at any subsequent time prior to its  award expiration date, as long as you remain employed with the Company or one of its subsidiaries through the exercise  date. It is your responsibility to track your NQSO expiration date(s), including any early expiration of your NQSO in  connection with the termination of your employment, to ensure you realize any value through a timely exercise. As with  any investment decision, you are strongly urged to consult with your personal financial advisor before exercising an  NQSO.    Follow these steps to exercise the vested portion of NQSO:    1. The execution of an NQSO exercise requires you to have a valid non-qualified Ameriprise brokerage account. If  you do not have one, contact your advisor or call the Ameriprise Advisor Center at 1-877-370-3950 to set up an  account. Initiating an NQSO exercise without having an AMP brokerage account can delay the ability to exercise  your NQSOs.  2. Sign into your account with Shareworks to exercise your stock options. Indicate how you plan to pay for the AMP  Shares you are purchasing by exercising the option and any required tax withholdings. You may pay the exercise  cost (the per-share exercise price multiplied by the number of shares) and required tax withholdings using one of  these payment options (in U.S. dollars):    • Net Exercise: Instruct Ameriprise Financial Brokerage Services (“AFBS”), our exclusive broker, to withhold a  portion of the exercised shares equal in fair market value to the exercise cost plus any required tax  withholdings to the Company in lieu of paying the exercise price in cash. The number of shares withheld to  cover the required tax withholding is determined using the exercise method as follows:     Exercises entered during market trading hours (9:30 am ET – 4 pm ET) will use the fair market value  (FMV) price at the time the exercise is initiated; however, if the exercise is made pursuant to a limit order,  then the limit price will be used for the calculation of taxes and shares withheld.     Exercises entered after 4 pm ET and before 9:30 am ET will use the last closing FMV price; however, if the  exercise is made pursuant to a limit order, then the limit price will be used for the calculation of taxes and  shares withheld.    There is no fee to open a brokerage account with AFBS, and you will pay a reduced commission if AFBS sells  shares on your behalf. Regular brokerage account maintenance fees apply. Please note that the Net Exercise  method replaced the Cashless Exercise method for all NQSOs granted under the Plan on or after Feb. 6,  2012.    • Cashless Exercise: Instruct AFBS to sell all exercised shares and pay the exercise cost and any required tax  withholdings from the proceeds. There is no fee to open a brokerage account with AFBS, and you will pay a  reduced commission when AFBS sells shares on your behalf. The Cashless Exercise method is only  available for NQSOs granted under the Plan on or before Feb. 5, 2012.    • Buy-and-Hold Exercise: (Cash Exercise, using cash in AFBS account): Pay the exercise cost by  instructing AFBS to take funds from your brokerage cash account.    If you choose to pay the exercise cost using the Buy- and-Hold Exercise, you must have the funds available in  your brokerage account prior to initiating your exercise activity. You may pay any required minimum tax  

 

7   withholding by instructing AFBS to take funds from your brokerage cash account to pay the required minimum tax  withholding or instructing AFBS to withhold and sell the appropriate number of shares (otherwise available from  the exercise) to pay the required minimum tax withholding. Note: Shares cannot be sold until after tax withholding  liability has been determined. Due to price fluctuation (between exercise and disposition of shares), the exact  number of shares needed to cover taxes will not be known immediately upon exercise.    3. Additional Approvals, Restrictions and Reporting (For Bands 50 and above and certain other Participants only)    • Obtain required pre-clearance. The Corporate Secretary’s Office will provide you with an email explaining  the pre-clearance process. It is important to understand, however, that pre-clearance may not be granted,  depending on the facts and circumstances.    • Provide required notice. Other Band 50 and above Participants are required to provide advance notice to  their Executive leader if the exercise request exceeds certain hurdles (e.g., the request would result in the  exercise of more than 40% of your available AMP NQSOs within any 90-day period).    Note: Regardless of whether one has received pre-clearance or provided the required notice, he or she remains  legally responsible for compliance with the federal securities laws prohibiting trading in securities when aware of  nonpublic information about Ameriprise or its securities that a reasonable investor would consider significant when  trading in those securities. Participants who are subject to the regular quarterly blackouts on trading in Ameriprise  securities, including the exercise of NQSOs, will receive emails from the Corporate Secretary informing them of the  dates on which the blackout will begin and end, as well as the related policy requirements.    • Black-out period. There is a quarterly black-out period when the trading window closes and remains closed for  approximately four weeks, as declared, until the Company’s earnings for the preceding quarter are made  public. Other black-out periods may apply as determined by the Corporate Secretary’s Office. All affected  Participants will receive an email from the Corporate Secretary’s Office quarterly stating the blackout dates  including a copy of the Ameriprise Securities Trading Policy.    Important: If your NQSO will expire during a Company-declared black-out period, you must take action to exercise  the NQSO prior to the start of the black-out period. You will be solely responsible for any loss if you fail to exercise  the NQSO before such black-out period. During the black-out period, you can no longer exercise the NQSO absent  a hardship exception, which is rarely granted, and the NQSO will be cancelled on the expiration date. If you have a  limit order exercise set up in Shareworks it will automatically get canceled during the black-out period.    • (For Bands 70 and above only) Affirm stockownership requirements are met or requirements understood  if not yet met. The Company has implemented stock ownership guidelines for executives. These guidelines  have been communicated to affected executives. All Band 70 and above Participants will receive a stock  ownership summary statement not less frequently than annually.    • (For executive officers only) Participants who are executive officers of the Company also need to be aware that  all of their acquisitions and dispositions of AMP Shares, including AMP Shares and similar rights under the  Plan, the Ameriprise Financial 401(k) Plan, and all other stock- based compensation plans maintained by the  Company or its subsidiaries, may be subject to the reporting requirements and short-swing trading restrictions  under Section 16 of the Securities Exchange Act of 1934. Participants who are executive officers of the  Company should consult with their personal financial or legal advisor prior to selling and/or buying AMP  Shares.    The provisions and procedures described above are subject to change.  

 

8   Illustration of NQSO Exercise Methods*    (For U.S. purposes only) The illustration shows three ways to exercise an NQSO. In this example, assume a U.S.  employee chooses to exercise 1,000 NQSO shares with an exercise price of $30 per share. Assume the market price  preceding the exercise date is $50 per share.     Exercise Method  Net Exercise Cashless Exercise Buy-and-Hold  A Market value of exercised AMP  Shares at $50 ($50 per share x 1,000  shares)    $50,000  B Exercise cost paid ($30 per share x  1,000 shares)  $30,000    600 shares will be  withheld to pay the  exercise cost (i.e., 600  shares x $50 per share)  All 1,000 shares will be  sold in the open market.  $30,000 of the sale proceeds  will be paid to the Company  to pay the exercise cost  In order to pay the exercise cost  ($30,000), a Participant must  have the necessary funds in his or  her AFBS account prior to  initiating an online exercise.  C Pre-Tax Gain (A – B)   $20,000  D Minimum U.S. tax withholding paid (C  x 40% assumed tax)  $8,000 $8,000 of the sale  proceeds will be paid to the  The Participant will instruct AFBS  either to take $8,000 from his or  160 shares will be  withheld to cover the  required tax  withholdings (160 x  $50 per share)  Company to cover the required  tax withholdings  her brokerage account, or to  withhold 160 shares to cover the  required tax withholdings  E Incremental value after exercise cost  and tax withholding (A – B – D)    $12,000  F Incremental share ownership (or net  proceeds) from exercise  240 shares with a  value of $12,000  $12,000 in cash Assuming you withhold shares to  cover the required tax  (1,000 - 600 for withholdings, 840 shares (1,000 -  exercise cost -160 for 160 shares withheld for taxes)  required tax   withholdings)   Minus any applicable broker commissions.  * See “About the Illustrations” for an important disclosure.    Treatment of NQSOs upon Certain Events    To find out how your NQSOs will be treated upon retirement, employment termination, retirement, leave of absence, etc.,  please see the “Treatment of LTIAs upon Certain Events” section in this Guide.      Performance Stock Units (for executive officers only)  PSUs are subject to the terms of the PSU Supplement to this Guide and your PSU Award certificate. Please refer to the  separate PSU Supplement to this Guide that was provided to you and your PSU Award for details and provisions  pertaining to these Awards.      Performance Cash Units  PCUs are subject to the terms of the PCU Supplement to this Guide and your PCU Award certificate. Please refer to the  separate PCU Supplement to this Guide on Inside and your PCU Award for details and provisions pertaining to these  Awards.      Tax Implications for LTIAs (U.S. only)  The following is a summary description of the United States federal income and employment tax consequences generally  arising with respect to RSAs, NQSOs and RSUs issued under the Plan. For U.S. federal income tax consequences of  PSUs and PCUs, please refer to the PSU Supplement to this Guide or PCU Supplement to this Guide, as applicable.  

 

9   There may also be state and local taxes applicable to these awards. This summary is not intended to be a complete  description of all possible tax consequences of LTIAs issued under the Plan, and you should be aware that different tax  treatments may apply outside of the United States depending upon your country of residence and/or citizenship.    RSAs and RSUs: Income & Employment Tax Implications    The tax rules that apply to your RSA or RSU award vary based on your tax jurisdiction. Below is a summary of the general  U.S. federal income tax implications for U.S. taxpayers. The Company is not providing advice to you on the tax  treatment of any LTIA. You are strongly urged to consult with your personal tax advisor on the applicable tax  implications of RSA or RSU awards and selling acquired AMP Shares considering your individual circumstances.    For employees subject to U.S. federal income tax, there are no federal income tax consequences when an RSA or RSU  award is granted. When the restricted period expires and RSA shares vest (i.e., the RSA shares become transferable or  no longer subject to a substantial risk of forfeiture, whichever occurs earlier) or when RSU shares are delivered to you,  you receive ordinary compensation income based on the market value of an AMP Share on the day of vesting or delivery,  as applicable. Your Form W-2 wage and earnings statement will indicate that you had ordinary compensation income  equal to the market value of your vested AMP Shares.    Income resulting from the vesting of RSA shares or the delivery of RSU shares is subject to statutory withholding for U.S.  federal income tax and FICA taxes (Social Security and Medicare), plus any applicable statutory state and local  withholding. (NOTE: The actual income tax you owe will be based on your individual circumstances and may be more or  less than the income tax withheld.) The net AMP Shares deposited into your account will be the number of AMP Shares  specified in your RSA or RSU award less the necessary number of AMP Shares needed to satisfy any tax withholding  requirements. Please note that in some instances FICA taxes may be payable before an Award vests and you  receive AMP Shares. For example, if you become eligible to retire during the vesting period for an RSU, generally,  the RSU will be taxable for FICA purposes on the date that you become eligible to retire and not on the later  vesting date or the date that you actually retire. In this case, only income taxes would apply at vesting or  delivery, as applicable, of the AMP Shares.    If you later sell AMP Shares acquired from the vesting of RSA shares or the delivery of RSU shares, you will realize a  short-term or long-term capital gain (or loss) on the spread between the market value on the date of vesting or delivery  (your cost basis) and the net proceeds you receive when you sell the AMP Shares. If you realize a gain after satisfying a  minimum holding period (currently greater than one year) and are in a net capital gain position under applicable U.S. tax  rules, you may be able to pay tax on the gain based on long-term capital gains tax rates. These rates are generally lower  than ordinary income and short-term capital gains tax rates. If you realize a loss, you may be able to use that loss to offset  any capital gains you may otherwise have. Any loss in excess of capital gains may, to a limited extent, be used to offset  ordinary income, as permitted under applicable U.S. tax rules.    During the vesting period, any dividends or dividend equivalents paid on unvested RSA or RSU shares will be paid  through the transfer agent and reflected in the earnings column under “R Stock Div” on your paycheck. Dividends or  dividend equivalents paid on these shares are also considered ordinary income and are subject to the taxes described  above. This ordinary income will appear on your Form W-2 wage and tax statement.    In advance of an RSA or RSU vesting event, you will receive a notification of this pending vesting from the Ameriprise  LTIA Administration Group. This notification will provide you with important information and instructions in advance of the  vesting date. Details of your RSA or RSU vesting event, including vesting date, market value of your vested AMP Shares,  stock price used to calculate the fair market value, number of shares withheld to satisfy your tax obligation, breakdown of  the taxes withheld, and net shares delivered to you are available via Shareworks. You will also receive an email  notification regarding the quarterly dividend payment from the Ameriprise LTIA Administration team prior to the payment  date.    NQSOs: Income and Employment Tax Implications    The tax implications that apply when you exercise your NQSOs vary based on your tax jurisdiction. Below is a summary of  the general U.S. federal income and employment tax implications for holders of NQSOs who are U.S. taxpayers. The  Company is not providing advice to you on the tax treatment of any LTIA, including the exercise of an NQSO. You  are strongly urged to consult with your personal tax advisor on the applicable tax implications of NQSOs and  selling acquired AMP Shares considering your individual circumstances.    For employees subject to U.S. federal income tax, in the year that you exercise an NQSO, your Form W-2 wage and tax  statement will indicate that you had ordinary compensation income equal to the difference between the per-share exercise  

 

10   price and the market value of an AMP Share on the day of the exercise multiplied by the number of shares exercised on  such date.    Income resulting from an NQSO exercise is subject to statutory withholding for U.S. federal income tax and FICA taxes  (Social Security and Medicare), plus any applicable statutory state and local withholding. (NOTE: The actual income tax  you owe will be based on your individual circumstances and may be more or less than the income tax withheld.) How you  pay any required tax withholdings is determined based on which of the payment options you use to exercise your NQSO.  Please refer to the sections in this Guide titled “Illustration of NQSO Exercise Methods” and “Steps for Exercising NQSOs”  for additional information on the methods for paying required tax withholdings.    If you later sell AMP Shares acquired from an NQSO exercise, you will realize a short-term or long-term capital gain (or  loss) on the spread between the market value on the date of exercise (your cost basis) and the net proceeds you receive  when you sell the AMP Shares. If you realize a gain after satisfying a minimum holding period (currently greater than one  year) and are in a net capital gain position under applicable U.S. tax rules, you may be able to pay tax on the gain based  on long-term capital gains tax rates. These rates are generally lower than ordinary income and short-term capital gains tax  rates. If you realize a loss, you may be able to use that loss to offset any capital gains you may otherwise have and any  loss in excess of capital gains may, to a limited extent, be used to offset ordinary income, to the extent permitted under  applicable U.S. tax rules.    Multi-State Taxation Process    If you work in multiple states or have transferred between states during your work tenure and awards have been granted  during those years under the LTIA Program, a state wage adjustment may be done to properly allocate your  earnings. Some individual states require a “look-back” allocation for various types of income, including the exercising of  non-qualified stock options, vesting of restricted stock awards including RSAs and RSUs, as well as some other  compensation distributions not granted under the LTIA Program.    Each year, the company engages the professional services of EY (Ernst & Young) to assist with the recalculation of the  appropriate state wages for the various earnings. A year-end adjustment is then made so that the appropriate state  allocation amount is reported correctly on your Form W-2, based on individual state rules for allocating these various  types of compensation items. If you are affected by the multi-state taxation process, you will receive a report in early  February each year for the prior year’s activity from HR Services to support the final state allocations reported on your  Form W-2.    Please Note: If you are affected by the multi-state taxation process, the state tax withholding amounts recorded in  Shareworks are a record of the taxes withheld for NQSO exercises and/or RSA/RSU vesting events based upon the  withholding rates as recorded in Payroll at the time the activity took place. Please consult your tax professional regarding  the effect on your personal state tax return(s).    Section 409A of the Code    It is intended that all Awards under the Plan either comply with or are exempt from the requirements of Section 409A to  prevent the inclusion in gross income of any benefits accrued thereunder in a taxable year prior to the taxable year or  years in which such amount would otherwise be distributed or made available to the Participant. All Awards under the  Plan shall be administered and interpreted in a manner that is consistent with such intention and the Company’s Policy  Regarding Section 409A Compliance.    Notwithstanding any other provision of this Guide to the contrary, to the extent that an Award constitutes nonqualified  deferred compensation to which Section 409A of the Code applies: (1) payments under such Award shall be made at a  time and in a manner that satisfies the requirements of Section 409A of the Code and guidance of general applicability  issued thereunder, including the provisions of Section 409A(a)(2)(B) of the Code to the extent distributions to any  employee are required to be delayed six months; (2) references to “termination of employment” and similar terms mean  the date that the Participant first incurs a “separation from service” within the meaning of Section 409A of the Code; and  (3) payment shall be made as soon as administratively practicable following the permissible payment event, but in no  event later than the end of the year in which the permissible payment event occurs, or, if later, by the 15th day of the third  month following the date of the permissible payment event (and the Participant will not be permitted, either directly or  indirectly, to designate the year of payment). If any payment that would otherwise be made under an Award is required to  be delayed by reason of this section, such payment shall be made at the earliest date permitted by Section 409A of the  Code. The amount of any delayed payment shall be the amount that would have been paid prior to the delay and shall be  paid without interest.  

 

11   Treatment of LTIAs upon Certain Events  Existing policies regarding the treatment of outstanding RSAs, NQSOs and RSUs under certain circumstances are  described below. For the treatment of outstanding PSUs and PCUs, please refer to the PSU Supplement to this Guide or  PCU Supplement to this Guide, as applicable. The Committee may amend the following policies for any or all outstanding  and future LTIAs. For specific information about the treatment of your LTIAs, please see the applicable section of this  Guide that describes the following specific events:    • Part-time employment status  • Employment termination  • Rehire  • Leave of absence  • Death  • Disability termination  • Retirement  • Transfer between business segments  • Transfer from field eligible employee to franchise advisor  • Situations of Detrimental Conduct (Band 50 and above)  • Compensation Recovery or “Clawback” Policy (For executive officers only)  • Change in Control of the Company    Part-Time Employment Status    Outstanding LTIAs continue to vest while you are on part-time status, subject to the Company’s right to adjust or terminate  any outstanding LTIAs, based on its determination of a significant change in your duties and responsibilities.    Employment Termination    This section pertains to employment terminations other than retirement, death, or disability (which are separately  described below).    Voluntary Termination: If you terminate your employment with the Company for any reason other than death, disability,  or retirement, your unvested LTIAs will be forfeited on your last day of employment. There are no exceptions to this rule.  Any vested and exercisable NQSOs that you do not exercise within 90 days after your last day of employment (and before  the award expiration date, if earlier) will expire and be canceled.    Involuntary Termination Not Eligible for Severance Under Company Plan: Except as indicated below, if your  employment is terminated for any reason other than death, disability or retirement or in connection with a Change in  Control (which is separately described below) and you are not entitled to receive benefits under a Company severance  plan(as defined by the Company), your outstanding LTIAs, including any exercisable NQSO shares that have not been  exercised, will expire and be canceled on your last day of employment (or the award expiration date, if earlier). For the  avoidance of doubt, your vested NQSOs will be canceled on your last day of employment and you will not have 90 days  after your last day of employment during which to exercise your vested NQSOs.    Terminations in Connection with Certain Company Actions: If your employment is terminated as a result of certain  Company actions, such as the divestiture of a business unit, and you are not entitled to receive benefits under a Company  severance plan (as defined by the Company), your unvested NQSOs, RSAs and RSUs will be canceled on the earlier of  the award expiration date or your last day of employment. You will have 90 days from your last day of employment (or  until the award expiration date, if earlier) to exercise any vested and exercisable NQSO shares. Your vested NQSOs will  expire and be canceled upon the earlier of the end of the 90-day period following your termination and award expiration  date.    Involuntary Termination Eligible for Severance Under Company Plan: If your employment is terminated and you  receive benefits under a Company severance plan (as defined by the Company) in the form of payments over a specified  severance period, your unvested NQSOs, RSAs and RSUs will be canceled on the earlier of the award expiration date or  last day of your severance period. You will have 90 days from the last day of your severance period (or until the award  expiration date, if earlier) to exercise any vested and exercisable NQSOs. However, if you begin a new full-time position  outside the Company (other than self- employment) during the severance period, your outstanding LTIAs will be canceled  upon commencement of such employment, regardless of the continuation of severance payments.  

 

12   If your employment is terminated and you receive benefits under a Company severance plan (as defined by the  Company) in the form of a lump-sum payment, your outstanding unvested NQSOs, RSAs and RSUs will be canceled as  of your last day of employment. You will have 90 days from your last day of employment (or until the award expiration  date, if earlier) to exercise any vested and exercisable NQSOs. Your vested NQSOs will expire and be canceled upon the  earliest of the end of the 90-day period following your termination, the date that you commence a new full-time position  outside the Company (other than self-employment) and the award expiration date.    Rehire: Please note that in the event you terminate your employment with the Company, or your employment is  terminated by the Company and any of your outstanding LTIAs are canceled and/or forfeited, and you are subsequently  rehired by the Company, any LTIAs that were canceled and or forfeited at termination will not be reinstated upon rehire.    Leave of Absence    Outstanding LTIAs continue to vest when you are on a leave of absence (as determined by the applicable Company  policies) subject to the Company’s right to adjust or terminate any outstanding LTIAs, based on its discretion of a  significant change in your duties and responsibilities and/or related employment.    Death    The following chart shows how RSAs, RSUs and NQSOs are treated if your employment with the Company terminates  due to your death.    Award Type Provisions  RSA and RSU Outstanding RSAs and RSUs become 100% vested and are paid as soon as  administratively practicable following the date of death.  NQSO Outstanding NQSOs at death become 100% exercisable. NQSOs are exercisable by the  estate for up to 12 months after the date of death or the remaining term of the NQSO,  whichever is earlier.    In the event of your death, shares for all RSAs and RSUs that vest will automatically be issued to your estate. Because  NQSO Awards cannot be transferred, the Executor/Executrix of your estate must open an Ameriprise Financial estate  brokerage account to exercise any NQSOs. The estate is then responsible for distributing any funds or shares according  to the laws of descent and distribution.    Disability Termination    The following chart shows how your RSAs, RSUs and NQSOs are treated if your employment with the Company  terminates due to a qualifying disability (as defined by the Company).    Award Type Provisions  RSA and RSU Outstanding RSAs and RSUs become 100% vested and are paid as soon as  administratively practicable following your termination of employment due to disability.  NQSO Outstanding NQSOs become 100% exercisable. NQSOs are exercisable for up to 12  months after termination of employment due to disability or the remaining term of the  NQSO, whichever is earlier.    Retirement    The following chart shows how RSAs, RSUs and NQSOs are treated upon “Retirement.” The applicable definition of  Retirement for all LTIAs granted to U.S. or India Participants is attainment of age 55 with at least 10 years of applicable  service at the point of termination, regardless of any pension plan or other definitions of retirement.    Award Type Provisions  RSA and RSU Grants awarded in the calendar year you retire are forfeited. All other awards remain  outstanding and continue to vest and will be paid upon the otherwise applicable vesting  date under your Award certificate.  

 

13   NQSO Grants awarded in the calendar year you retire are forfeited. All other awards remain  outstanding and continue to vest. NQSOs are exercisable for up to five years after your  retirement or the remaining term of the NQSO, whichever is earlier. Your NQSOs expire  and are forfeited upon the earlier of the end of the five-year post-retirement period or the  applicable expiration date.      Transfer between Business Segments    Outstanding LTIAs continue to vest when you transfer from one business segment to another, subject to the Company’s  right to adjust or terminate any outstanding LTIAs, based on its discretion of a significant change in your duties and  responsibilities and/or related employment.      Transfer from Field Eligible Employee to Franchise Advisor    Certain provisions for LTIA continuation apply to awards held by employees (limited to those employees in eligible field  sales leadership roles) who transition to franchise advisor without a break in service. The applicable provisions are  available on Inside, and such provisions are incorporated into, and part of the terms and conditions of, Awards under the  Plan.    Situations of Detrimental Conduct    (Bands 50 and above)  To protect the interests of the Company and all employees, the Company has implemented Detrimental Conduct  Provisions, affecting Plan Participants in Bands 50 and above. These provisions support the multi-year performance  objectives of LTIAs, and such provisions are incorporated into, and part of the terms and conditions of, Awards under the  Plan.  Detrimental Conduct Provisions specify how LTIAs and LTIA payments will be handled in the event a Band 50 or above  employee joins a defined competitor (“Competition”), leaves and solicits business customers, solicits or hires Ameriprise  Financial employees, discloses confidential information or trade secrets, denigrates the Company or Company employees  or otherwise engages in conduct that is against the Company’s interests during certain time periods, in each case, as  defined by the Company (each, a “Restricted Activity”).    For Bands 50 and 60 Participants: Competition during employment or the six-month period after termination of  employment or engaging in any Restricted Activity during the twelve-month period after termination of employment results  in the cancellation of all outstanding Awards and repayment of any gain realized upon the exercise of NQSOs (as of the  exercise date), any payments made or shares delivered under PSUs or PCUs and any shares delivered under RSAs and  RSUs, in each case, during the twelve months prior to, and the 90 days following, your termination of employment.    For Bands 70 and above Participants: Competition during employment or the twelve-month period after termination of  employment or engaging in any Restricted Activity during the twelve-month period after termination of employment results  in the cancellation of all outstanding Awards and repayment of any gain realized upon the exercise of NQSOs (as of the  exercise date), any payments made or shares delivered under PSUs or PCUs and any shares delivered under RSAs and  RSUs, in each case, during the two years prior to, and the 90 days following, your termination of employment.    Please note: This is a summary of the Detrimental Conduct Provisions that apply to LTIAs generally. Please  review the Consent to the Application of Forfeiture and Detrimental Conduct Provisions to Long-Term Incentive  Awards and/or any other restrictive covenant agreements between you and the Company or any of its  subsidiaries for the specific detrimental conduct provisions and/or restrictive covenants that apply to your  Awards.      Compensation Recovery or “Clawback” Policy (For executive officers only)    The Committee approved a compensation recovery or “clawback” policy (the “Clawback Policy”) that applies to all Awards  granted to executive officers, including the Company’s Executive Leadership Team, on or after January 1, 2011. Under  the Clawback Policy, if you engage in intentional misconduct that causes or substantially causes a material restatement of  the Company’s financial reports, and the restated financial results would have resulted in a lesser number of AMP Shares  or a lesser amount of cash being granted to you under an Award, or a lesser number of AMP Shares or a lesser amount  

 

14   of cash being paid or delivered to you, in each case, within the 12-month period following the issuance of such inaccurate  financial statement, then the Committee, in its sole discretion, may require you to forfeit all or a portion of your outstanding  Awards or to repay all or a portion of the gains that you realized under your Awards during such period. In addition,  effective for Awards made on or after January 1, 2020, if you are found liable for having engaged in an intentional and  material violation of law that results in significant reputational harm or financial loss to the Company, the Committee, in its  sole discretion, has the right to require you to forfeit all or a portion of your outstanding Awards. The Committee may  amend the Clawback Policy from time to time as it determines necessary or advisable, and such amended policy will  apply to your Awards.    Change in Control of the Company    The Plan’s provisions regarding a Change in Control of the Company (a “CIC”) have been designed to preserve earned or  anticipated compensation and benefits if a CIC were to occur. The goal of the Plan’s CIC provisions is to help you  maintain your focus on your work during the uncertainty that accompanies a potential CIC.    Generally, as the term is used in this Guide, a CIC includes the following:    1. A third party acquires 25% or more of the Company’s common shares or voting securities.  2. A majority of the Board is replaced.  3. The consummation of certain mergers, reorganizations, consolidations, and sales of assets.  4. The consummation of a complete liquidation or dissolution of the Company.    If a merger or other business combination transaction between the Company and another party occurs, a CIC will occur if  any of the following conditions are present:    • Parties who were Ameriprise Financial shareholders before the transaction own 50% or less of the voting  securities of the new company resulting from the business combination, or their ownership is not substantially in  the same proportions as before the transaction.  • An unaffiliated party ends up owning 25% or more of the voting securities of the new company (other than a party  who owns 25% or more before the transaction).  • A majority of the Board of the new company is made up of individuals who were not Ameriprise Financial Board  members at the time the deal was signed or approved.    In the event of a CIC, outstanding RSAs, RSUs and NQSOs issued on or before December 31, 2012, would vest  immediately if those Awards are not continued, assumed, or replaced in connection with the Change in Control. The  vesting of RSAs, RSUs and NQSO awards granted on or after January 1, 2013, will accelerate only upon the occurrence  of both a CIC and your termination of employment in a manner that entitles you to severance under the applicable  severance plan within two years following the CIC. For the treatment of outstanding PSUs and PCUs, please refer to the  PSU Supplement to this Guide or PCU Supplement to this Guide, as applicable.    Change in Control situations are complex and involve a variety of possible circumstances. In the event of a CIC, the  Company will provide detailed information to you about any compensation and benefits programs that may have special  CIC provisions.    Payments to Certain U.S. Taxpayers upon a Change in Control of the Company    (This section applies to U.S. taxpayers only. This material is highly complex. In the event of a CIC, the Company will  provide detailed information to you.)    In summary, Sections 280G and 4999 of the Code impose a 20 percent excise tax (in addition to regular income and  employment taxes) on certain compensatory payments (referred to as “excess parachute payments”) to certain individuals  (referred to as “disqualified individuals”) that are made in connection with a change in ownership or control of a  corporation. Generally, disqualified individuals include individual shareholders who own more than one percent of the fair  market value of the stock of the Company, the top 50 most highly compensated officers of the Company and its  subsidiaries and the top 250 most highly compensated employees or independent contractors of the Company and its  subsidiaries. The actual list of disqualified individuals can only be determined based on information available at the time of  a CIC, based on applicable IRS guidance.    In the event of a CIC, a disqualified individual may be liable for the 20 percent excise tax on a portion of his or her LTIAs  and other compensation and benefits if the value of such compensation and benefits constitute excess parachute  payments. The determination of whether all or a portion of the value of a payment or a benefit is an excess parachute  

 

15   payment is highly complex and can only be determined based on information available at the time of a CIC, based on  applicable IRS guidance.    In the event of a CIC, if the Company determines that you are a disqualified individual and that you will receive excess  parachute payments, then the Company will perform a “best net” calculation to determine whether you receive a better  economic result by continuing to be entitled to all of the compensation and benefits and by paying the excise tax yourself  or by having your entitlement to accelerated vesting and/or payment limited to the minimum extent necessary to avoid the  excise tax. The Company will determine, in its sole discretion, which approach is more favorable to you and will apply it.  You will not be eligible for additional payments to offset the impact of any excise tax. If the limit is applied, LTIAs and  value not accelerated for disqualified individuals will continue to be governed by applicable award documents and paid out  as applicable.    Resale of Shares Received Under the Plan    The U.S. securities laws impose restrictions on the resale of AMP Shares by individuals who are “affiliates” of the  Company. Affiliates may resell their AMP Shares by complying with Rule 144 under the Securities Act of 1933, as  amended (the “Securities Act”) or by registering their AMP Shares for sale under the Securities Act. These restrictions do  not apply to individuals who are not affiliates of the Company.    Major Terms and Conditions of NQSOs, RSAs and RSUs  The terms and provisions of LTIAs granted on or after Jan. 1, 2007, are different than the terms and conditions of LTIAs  granted prior to January 1, 2007. The terms and conditions of the prior LTIA Guide will continue to apply to all awards  granted prior to Jan. 1, 2007.    Non-Qualified Stock Options    The following table summarizes the terms and conditions of NQSOs. Keep in mind this is only a summary, and the actual  Plan document, Program Guide and Award details will govern.    NQSO Awards   Voluntary Termination and  Involuntary Termination  Eligible for Severance    -- Unvested Forfeited  -- Exercise Period for Vested 90 days after termination or remaining term of grant, whichever is earlier  Involuntary Termination Not  Eligible for Severance (except  for Terminations in  Connection with Certain  Company Actions; see  applicable section in Guide)    -- Unvested Forfeited  -- Exercise Period for Vested 0 days after termination  Death & Disability   -- Unvested Vesting accelerated  -- Exercise Period for Vested Up to 12 months after death or disability or remaining term of grant, whichever  is earlier  Retirement   -- Unvested (Age 55+ and 10 years of service)  Grants awarded in calendar year of retirement are forfeited. All other grants  remain outstanding and continue to vest  -- Exercise Period for Vested Up to five years or remaining term of grant, whichever is earlier  Vesting Generally, will vest in equal installments over a three-year period, or  according to such other vesting schedule specified in the Award detail.  

 

16   Detrimental Conduct  Provisions (Bands 50 and  Above Only)  See your Detrimental Conduct Agreement and the Competitor List posted on  Inside  Clawback Policy – Executive  Officers, including Executive  Leadership Team, only  A compensation recovery or “clawback” policy applies to all Awards granted  to executive officers on or after January 1, 2011.  Transfer to Franchise Advisor  (Eligible Field employees  Only)  Please refer to the Treatment of Long-Term Incentive Awards for Employees  Transferring to Ameriprise Financial Franchise Advisor Status found on Inside  for most recent information      Restricted Stock Awards and Restricted Stock Units  The following table summarizes the terms and conditions of RSAs and RSUs. Keep in mind this is only a summary, and  the actual Plan document, Program Guide and Award details will govern.    RSAs and RSUs Awards   Voluntary Termination and  Involuntary Termination  Eligible for Severance –  -- Unvested      Forfeited  Involuntary Termination Not  Eligible for Severance (except  for Terminations in  Connection with Certain  Business Dispositions; see  applicable section in Guide)  -- Unvested            Forfeited  Death & Disability  -- Unvested    Vesting and distribution of shares accelerated  Retirement  -- Unvested  (Age 55+ and 10 years of service)  • RSAs and RSUs awarded in calendar year of retirement are forfeited    • All other RSAs and RSUs remain outstanding and continue to vest and  shares will be distributed at the otherwise applicable vesting date  Vesting Generally, will vest in equal installments over a three-year period, or  according to such other vesting schedule specified in the Award detail.  Detrimental Conduct  Provisions (Bands 50 and  Above Only)  See your Detrimental Conduct Agreement and the Competitor List posted on  Inside  Clawback Policy – Executive  Officers, including Executive  Leadership Team, only  A compensation recovery or “clawback” policy applies to all Awards granted  to executive officers on or after January 1, 2011  Transfer to Franchise Advisor  (Eligible Field employees  Only)  Please refer to the Treatment of Long-Term Incentive Awards for Employees  Transferring to Ameriprise Financial Franchise Advisor Status found on  Inside for most recent information      Administrative Information about this Guide  About this Guide    This Guide sets forth the terms, conditions and features of Awards granted pursuant to the Plan. In the event of a conflict  or inconsistency between this Guide and the Plan, the Plan provisions will govern. The general nature of the Plan and its  

 

17   terms and conditions are described here, but the information contained in this Guide is for general guidance only and is  not intended to be a complete description of the Plan.    The LTIA program is designed for eligible employees of the Company, and any of its subsidiaries participating in the Plan,  as determined by the Committee. Awards are granted at the discretion of the Committee, or, to the extent permitted by the  Plan, its delegate, and are subject to local market regulations and legislation, which could change at any time. Also note  that while the tax laws that apply to Participants are based on each employee’s tax jurisdiction, and the tax information  provided in this Guide is for U.S. purposes only. The Company strongly urges all employees to consult their  personal tax advisor with any questions or issues regarding their Awards or their participation in the Plan.    The Board, and to the extent authority has been delegated to the Committee, the Committee, may, from time to time,  alter, amend, interpret, suspend or terminate the Plan and applicable Plan documents as it shall deem advisable, without  the prior consent or notice of employees (including, but not limited to, alignment with legislative or regulatory  developments) subject to the terms of the Plan document, including the rules and regulations of the principal securities  market on which AMP Shares are traded.    This Guide does not constitute a contract of employment between the Company and any individual or an obligation by the  Company to maintain any particular compensation or benefit plan, program, practice or policy. This Guide does not  replace or change an existing contract of employment between the Company and any individual. The Company has taken  steps to ensure the accuracy of this Guide; however, it reserves the right to issue corrected information in the event of an  error.    About the Illustrations    All Award illustrations and corresponding values shown in this Guide are for hypothetical purposes only and are based  upon financial, share price and other assumptions about future events or circumstances, which may or may not actually  occur. All Awards are subject to continuous employment and other award requirements.    The illustrations are hypothetical and not meant to imply that the Company will achieve certain stock prices or growth  rates or has achieved any stated growth rate consistently in the past. The value and return on Company common stock  will fluctuate over time and may be worth more or less than the values shown in these illustrations. Past performance is no  guarantee of future results. Please consult your personal financial advisor on the value, tax, and other implications of your  LTIAs under the Plan, as applicable to your circumstances. This Guide is not intended to provide any financial or tax  advice.    Award Confirmation Materials    All employee recipients of LTIAs will have online access to their individual LTIA information and grant details through the  Company’s online administrative platform, Shareworks.    Governing Award Documents    The Plan, the applicable Award communications or detail, this Guide and any supplement to this Guide contain the  controlling provisions of each Award granted pursuant to the Plan. These documents, along with Committee decisions, will  govern in cases of conflict, ambiguity or miscommunication. No employee has the authority to change or supersede LTIA  provisions or Committee decisions. Any representation to the contrary will be void and nonbinding on the Company.  The provisions of all Awards and this Guide are governed by, and subject to, the laws of the State of New York, United  States of America, without regard to its conflict of law provisions, as provided in the Plan.    AMP Shares Available for Grant under the Plan    54,400,000 AMP Shares are authorized for issuance under the Plan. Of such total, as of April 30, 2014, no more than  4,500,000 shares may be issued for what are referred to as “full value” awards, which are Awards other than stock options  or stock appreciation rights. AMP Shares issued under the Plan may be either newly issued shares or treasury shares.    Excluding AMP Shares that may be issued with respect to Substitution Awards, the maximum number of AMP Shares that  may be covered by options or stock appreciation rights granted to any Participant in any calendar year will not exceed  3,000,000 AMP Shares. Further, the amount payable in cash to any Participant for any calendar year for all Awards other  than options or stock appreciation rights will not exceed $30,000,000.    If any shares subject to an award are forfeited, expire or otherwise terminate without issuance of such shares, or any  

 

18   award is settled for cash or otherwise does not result in the issuance of all or a portion of the shares subject to such  award, such shares shall, to the extent of such forfeiture, expiration, termination, cash settlement or nonissuance, again  be available for issuance under the Plan. Shares withheld by the Company to satisfy tax withholding requirements for  Awards other than options or stock appreciation rights will also again be available for issuance under the Plan.    For the avoidance of doubt, in the event that (i) any stock option is exercised through the tendering of shares (either  actually or by attestation) or by the withholding of shares by the Company, (ii) withholding tax liabilities arising from such  option or stock appreciation right are satisfied by the tendering of shares (either actually or by attestation) or by the  withholding of shares by the Company, or (iii) any shares are repurchased by the Company with the proceeds from option  exercises, the shares so tendered or withheld or repurchased shall not become available for issuance under the Plan.    Plan Administration    The Committee may from time to time designate the people who should be granted Awards under the Plan and the  amount, type and other terms and conditions of Awards. Subject to the terms and limitations of the Plan, the Committee  will have full discretion and authority to administer the Plan, including authority to interpret and construe the provisions  and terms of Awards and to adopt rules and regulations under the Plan.    Notwithstanding the Committee’s broad authority under the Plan, the Committee generally may not reprice, adjust or  amend the exercise price of outstanding stock options or the strike price of outstanding stock appreciation rights, whether  through amendment, cancellation and replacement grant, or any other means, nor permit the exchange of an outstanding  option for cash or another award, unless such action is approved by the Company’s shareholders. In addition, certain  amendments to the Plan require shareholder approval.    The Plan is not subject to the requirements of the Employee Retirement Income Security Act of 1974, as amended  (ERISA) and it is not qualified under the Internal Revenue Code.    The Board appoints Committee members for an annual term. The Board may remove any Committee member for cause,  and a majority of the shareholders may remove a Committee member for any reason. No Committee member is an  employee of the Company or has any business undertakings with the Company.    Performance-Based Compensation    To the extent that an Award is intended to qualify as performance-based compensation under Section 162(m) of the  Code, the Committee may grant Awards based on achievement of one or more of the following performance measures:    • Net income or operating net income (before or after taxes, interest, depreciation, amortization, and/or  nonrecurring/unusual items),  • Return on assets, return on capital, return on equity, return on economic capital, return on other measures of  capital, return on sales or other financial criteria,  • Revenue or net sales,  • Gross profit or operating gross profit,  • Cash flow,  • Productivity or efficiency ratios,  • Share price or total shareholder return,  • Earnings per share,  • Budget and expense management,  • Customer and product measures, including market share, high value client growth, and customer growth,  • Working capital turnover and targets,  • Margins  • Economic value added or other value-added measurements (considered absolutely or relative to historic  performance or relative to one or more other businesses and determined for the Company or a business unit or  division).    Such performance goals shall be established and measured by the Committee within the time period prescribed by, and  shall otherwise comply with, the requirements of Section 162(m) of the Code.    Adjustments upon Changes in Capitalization    If the outstanding shares of Company common stock are changed by reason of any stock split, stock dividend,  combination, subdivision or exchange of shares, recapitalization, merger, consolidation, reorganization or other  

 

19   extraordinary or unusual event, the Committee, to the extent that it determines adjustments to be appropriate, will direct  that appropriate changes be made in the maximum number or kind of securities that may be issued under the Plan and in  the terms of certain outstanding awards, including the number of shares or securities subject to awards and the exercise  price or other stock price or share-related provisions of awards.    Tax Withholding    The Plan provides that the Committee is authorized to establish procedures to enable Participants to elect to satisfy  certain federal, state and local withholding tax requirements using any method approved by the Committee. Such  methods may include, but are not required to include, withholding such amounts from the Participant’s compensation, the  Participant paying such amounts in cash, the Participant tendering previously acquired AMP Shares or the Company  withholding AMP Shares otherwise issuable under the Award. If a Participant tenders AMP Shares or instructs the  Company to withhold AMP Shares, only the number of AMP Shares sufficient to satisfy the minimum withholding tax  requirements will be tendered or withheld.    Assignment and Transfer    LTIAs may not be sold, pledged, assigned, hypothecated, transferred or disposed of in any manner other than by will or  by the laws of descent or distribution, except as permitted by the Committee.    Amendment    Our Board of Directors may at any time suspend or discontinue the Plan or revise or amend it in any way; however, the  Board generally may not reprice, adjust or amend the exercise price of outstanding stock options or the strike price of  outstanding stock appreciation rights, whether through amendment, cancellation and replacement grant, or any other  means, nor permit the exchange of an outstanding option for cash or another award, unless such action is approved by  the Company’s shareholders. In addition, certain amendments to the Plan require shareholder approval.    Term of the Plan  No grants of LTIAs may be made under the Plan after February 25, 2024.        Resources  Availability of Certain Information and Incorporation of Documents by Reference    Pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company will provide, without  charge, upon the written or oral request of any person to whom this Guide is delivered by the Company or one of its  affiliated entities to the Corporate Secretary’s Office, Ameriprise Financial, Inc., 55 Ameriprise Financial Center,  Minneapolis, MN 55474, 612.671.3131, a copy of any of the following documents, all of which are incorporated by  reference in this Guide:    (a) The Company’s Registration Statement on Form 10, as amended, as filed with the Securities and Exchange  Commission (the “Commission”) August 19, 2005 (the “Form 10 Registration Statement”).  (b) All other reports filed by the Company pursuant to Section 13(a) or 15(d) of the Exchange Act since the end of the  fiscal year covered by the Form 10 Registration Statement; and  (c) The description of the Company’s common stock contained in the Company’s Form 10 Registration Statement,  including any amendment or report filed for the purpose of updating such description.    All documents filed by the Company with the Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange  Act subsequent to the date of the Registration Statement on Form S-8 to which this Guide relates and prior to the filing of  a post-effective amendment that indicates that all securities offered hereby have been sold or that deregisters all  securities then remaining unsold, will be deemed to be incorporated by reference in, and to be a part of, this Guide from  the date of filing of such documents. Any statement contained herein or in a document incorporated or deemed to be  incorporated by reference herein will be deemed to be modified or superseded for purposes of this Guide to the extent  that a statement contained in any subsequently filed document which also is or is deemed to be incorporated by reference  herein modifies or supersedes such statement. Any such statement so modified or superseded will not be deemed, except  as so modified or superseded, to constitute a part of this Guide.  

 

20   Nothing in this Guide will be deemed to incorporate information furnished but not filed with the Commission pursuant to  Item 2.02 or Item 7.01 of Form 8-K.    In addition, the Company will provide, without charge, upon the written or oral request of any person to whom this Guide is  delivered by the Company or one of its affiliated entities to the Corporate Secretary’s Office (contact information noted  above), copies of all reports, proxy statements and other communications distributed by the Company to the holders of  AMP Shares.    Contact Information    Type of question or  information needed    Contact/email/web address  Phone  number    Fax number  All stock option exercises  (Net, cashless or buy-  and-hold)  Ameriprise Financial Brokerage Services  Email: ESO.Group@ampf.com  612.671.5355  800.555.9826  612.671.6023  Ameriprise Brokerage  Account  (to access brokerage  account information)  Ameriprise Financial Brokerage Services  Website: ameriprise.com  612.671.5355  800.555.9826  612.671.6023  RSA/RSU, PCU/PSU and  NQSO grant information  (grants, exercise options,  vesting detail, tax  information, brokerage  account number on file  with Stock Administration)  Website:  wam.advisorcompass.com/ac/shareworks (Can  also search for Shareworks site on Inside and  AdvisorCompass®).  Email: Ameriprise.LTIA.Administration@ampf.com  612.678.7128 612.671.3948  Detrimental Conduct  Provisions for Bands 50  and above  Email: Ameriprise.compensation@ampf.com 612.671.3072 612.671.3948  Other information  requests (e.g., LTIA policy  questions for HR, general  LTIA questions)  Email: Ameriprise.LTIA.Administration@ampf.com 612.678.7128 612.671.3948  Senior Management  Stock Ownership  Program (Bands 70 and  above)  Email: Ameriprise.compensation@ampf.com 612.671.3072 612.671.3948  Pre-clearance,  Ameriprise Securities  Trading Policy including  information about  Blackout Periods  Ameriprise Corporate Secretary’s Office 612.678.0106  612.671.4471  612.671.4841  Stock Transfer Agent:  Shareholder inquiries,  Address changes,  Dividend check  replacement  Broadridge Corporate Issuer Solutions, Inc.  Email: shareholder@broadridge.com  Website: shareholder.broadridge.com/amp  866.337.4999 U.S.  and Canada    303.974.3777  International  Non-Available  American Express LTIA  information  Outsourced to Morgan Stanley Smith Barney 516.227.5605 Not Applicablecrge_ex101.htm

EXHIBIT 10.1
  
 THIS OPTION AND THE SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE HEREOF, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITY LAWS OF ANY STATE, BUT ARE BEING ISSUED PURSUANT TO CERTAIN EXEMPTIONS THEREUNDER. THIS OPTION AND SUCH SHARES OF COMMON STOCK HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR BY THE SECURITIES REGULATORY AUTHORITY OF ANY STATE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THIS OPTION AND SUCH SHARES OF COMMON STOCK ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION THEREUNDER OR EXEMPTION THEREFROM.
  
 TRANSWORLD HOLDINGS, INC.
 NON-QUALIFIED STOCK OPTION AGREEMENT
  
 THIS NON-QUALIFIED STOCK OPTION AGREEMENT (this “Agreement”) is made as of this 1st day of November, 2020 (the “Grant Date”), between TRANSWORLD HOLDINGS, INC. (the “Company”), 3419 West Gray Court, Tampa, Florida 33609 and PEGGY SCHUURMAN HESS (the “Optionee”), 1417 Olympic Club Boulevard, Davenport, Florida 33896.
  
 BACKGROUND  
  
 Optionee is the wife of Craig Harper-Denson (“Denson”), a director and the Chief Operating Officer (“COO”) of the Company and the Group President of PTGI-ICS of the Company.
  
 At the time of the acquisition of PTGI-ICS, it was agreed that an Option to purchase shares of the voting common stock (“Shares”) of the Company would be issued to the Optionee in consideration of Denson’s service in facilitating the acquisition of PTGI-ICS and assuming his role as COO of the Company and Group President of PTGI-ICS. PTGI-ICS was acquired on October 31, 2020.
  
 	 
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 1. Option Grant. The Company hereby grants to the Optionee an option (the “Option”) to purchase 10,500,000 Shares of the Company at an exercise price of $0.55 per share (the “Option Price”), the closing price of the Shares on the Grant Date.
  
 2. Exercise of Option and Payment of Purchase Price. The Option may be exercised in whole or in part at any time after one year from the Grant Date according to the following vesting schedule:
  
 	 Total Shares Exercisable
	  
	 Vesting Date

	  
	  
	  

	 5,250,000
	  
	 1 year from Grant Date

	 7,875,000
	  
	 2 years from Grant Date

	 10,500,000
	  
	 3 years from Grant Date

  
 and for a period of seven (7) years thereafter (a total of ten (10) years from the Grant Date) by delivering to the Company a written Notice of Exercise specifying the number of Shares to be purchased and the aggregate Option Price therefore; provided, however, that upon a Change in Capitalization (as defined in paragraph 10 below) all 10,500,000 shares shall become immediately exercisable. The Notice of Exercise shall be accompanied by full payment for the Shares, plus the amount of any tax withholdings required of the Company in connection with such exercise, by certified or official bank check or the equivalent thereof acceptable to the Company, provided, however, that in lieu of cash, the Optionee may tender to the Company Shares having a fair market value equal to the sum of: (a) the aggregate Option Price, plus (b) Company’s obligation to withhold federal, state and local taxes from the compensation deemed paid to Denson as a result of the exercise by Optionee.
  
 3. Early Termination and Right to Exercise. The Option may be exercised by the Optionee on or following the applicable vesting dates only if (i) Denson is employed by the Company on the vesting date(s), and (ii) Optionee is married to Denson and not legally separated from Denson on the applicable vesting dates. All of Optionee’s right, title and interests in the unvested Options and the Shares underlying such unvested Options shall be forfeited if Denson separates from service with the Company at any date prior an applicable vesting date. Upon Optionee’s divorce or legal separation from Denson, all vested Options and all Shares received by Optionee pursuant to her exercise of any vested Options shall transfer to Denson, at which time Denson shall be able to exercise such vested Options, with all references to Optionee herein replaced with Denson accordingly.
  
 	 
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 4. Stock Holder Rights. No rights or privileges of a stockholder in the Company are conferred by reason of the granting of the Option. The Optionee will not be entitled to any rights or privileges of a stockholder of the Company with respect to the Shares unless and until the Option has been properly exercised (including payment in full of the Option Price) and certificates representing the Shares have been issued by the Company to the Optionee.
  
 5. Denson Compensation and Withholding. On any Exercise Date(s), Denson will be deemed to have received compensation in an amount equal to the fair market value of the number of Shares for which the Option has been exercised, determined as of the closing price on the date of exercise, minus the aggregate Option Price payable by Optionee. Company shall pay to the applicable taxing authorities the amount(s) of withholding payable by Company as a result of the deemed compensation to Denson on the Exercise Date. Notwithstanding the foregoing, Optionee shall, no later than the date as of which the value of any portion of the Option first becomes includible in the gross income of Denson for purposes of applicable taxes, pay to the Company, or make arrangements satisfactory to the Company regarding payment of an amount up to the maximum statutory tax rates in Denson’s applicable jurisdiction with respect to the Option, as determined by the Company. The obligations of the Company hereunder shall be conditional on the making of such payments or arrangements, and the Company shall, to the extent permitted by applicable laws, have the right to deduct any such taxes from any payment of any kind otherwise due to Denson. Whenever cash is to be paid pursuant to the Option, the Company shall have the right to deduct therefrom an amount sufficient to satisfy any applicable withholding tax requirements related thereto. Whenever Shares or property other than cash are to be delivered pursuant to the Option, the Company shall have the right to require the Optionee to remit to the Company in cash an amount sufficient to satisfy any related taxes to be withheld and applied to the tax obligations; provided, that Optionee may satisfy the foregoing requirement by either (i) electing to have the Company withhold from delivery of Shares or other property, as applicable, or (ii) delivering already owned unrestricted Shares, in each case, having a value not exceeding the applicable taxes to be withheld and applied to the tax obligations. Such already owned and unrestricted Shares shall be valued at their fair market value on the date on which the amount of tax to be withheld is determined and any fractional share amounts resulting therefrom shall be settled in cash. Such an election may be made with respect to all or any portion of the Shares to be delivered pursuant to the Option. The Company may also use any other method of obtaining the necessary payment or proceeds, as permitted by applicable law, to satisfy its withholding obligation with respect to the Option.
  
 6. Issuance of Shares. Company shall issue to Optionee on the Exercise Date the amount of Shares equal to the number of Shares exercised minus the number of Shares (if any) tendered to the Company in payment for (i) the Company’s obligation to withhold, or (ii) the Option Price.
  
 	 
	-3-
	

	 

  
 7. Taxation. The parties intend for the Option to be exempt from Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) or, if not so exempt, to be treated in a manner which complies with the requirements of such section, and intend that this Agreement be construed and administered in accordance with such intention. In the event that the parties determine that the terms of this Agreement or the Option need to be modified in order to comply with Section 409A of the Code, the parties shall cooperate reasonably to do so in a manner intended to best preserve the economic benefits of this Agreement. Any payments that qualify for the “short-term deferral” exception or another exception under Section 409A of the Code shall be paid under the applicable exception. For purposes of the limitations on nonqualified deferred compensation under Section 409A of the Code, each payment of compensation under this Agreement shall be treated as a separate payment of compensation. Notwithstanding anything contained herein to the contrary, to the extent required in order to avoid accelerated taxation and/or tax penalties under Section 409A of the Code, amounts that would otherwise be payable and benefits that would otherwise be provided pursuant to this Agreement during the six-month period immediately following Denson’s separation from service shall instead be paid on the first business day after the date that is six months following Denson’s termination date (or death, if earlier). The exercise of the option will be subject to federal income taxation of Denson under Section 83 of the Internal Revenue Code of 1986, as amended, Treasury Regulation Section 1.83-7 and applicable State laws.
  
 8. Non-Transferability of Option. The Option shall not be transferable by the Optionee, except to Denson upon her divorce or legal separation or by Will or by the laws of descent and distribution, upon her death. Except as otherwise expressly provided in this Agreement, none of the provisions of this Agreement shall be for the benefit of, or enforceable by, any third-party beneficiary.
  
 9. Amendment. The terms and provisions of this Agreement may not be amended, modified or terminated except by the express mutual written consent of the parties hereto.
  
 10. Merger and Other Fundamental Transactions. In the event the Company is succeeded by another company in a reorganization, merger, consolidation, acquisition of property or stock, separation or liquidation, the successor company shall assume all of the outstanding Options granted under this Agreement or shall substitute new options for them, which shall provide that Optionee, at the same cost, shall be entitled upon the exercise of each such Option to receive securities as the Board of Directors (or equivalent governing body) of the succeeding, resulting or other company, shall determine to be equivalent, as nearly as practicable, to the nearest whole number and class of shares of stock to which Optionee would have been entitled under the terms of this Agreement. Notwithstanding the foregoing, in connection with a Change in Capitalization (as defined below), the Company’s board of directors (the “Board”) may provide, subject in all events to Optionee’s prior written approval and the requirements of Section 409A of the Code, for the cancellation of the Option granted hereunder in exchange for payment in cash or other property having an aggregate fair market value equal to the fair market value of the Shares, reduced by the aggregate Option Price; provided, however, that if the Option Price is equal to or greater than the fair market value of the Shares, the Board may cancel the Option without the payment of any consideration to the Optionee. For the purposes of this Section 10, “Change in Capitalization” means any (i) merger, consolidation, reclassification, recapitalization, spin-off, spin-out, repurchase or other reorganization or corporate transaction or event, (ii) special or extraordinary dividend or other extraordinary distribution (whether in the form of cash, Shares or other property), stock split, reverse stock split, share subdivision or consolidation, (iii) combination or exchange of Shares; or (iv) other change in corporate structure, which, in any such case, the Board determines, in its sole discretion, affects the Shares such that a cancellation pursuant to this Section 10 is appropriate.
  
 	 
	-4-
	

	 

  
 11. Securities Matters and Regulations. Notwithstanding anything herein to the contrary, the obligation of the Company to sell or deliver Shares with respect to the Option shall be subject to all applicable laws, rules and regulations, including all applicable federal and state securities laws, and the obtaining of all such approvals by governmental agencies as may be deemed necessary or appropriate by the Company. The Company may require, as a condition of the issuance and delivery of certificates evidencing Shares pursuant to the terms hereof, that Optionee make such agreements and representations, and that such certificates bear such legends, in each case substantially in the form attached hereto as Exhibit A. The Optionee understands and agrees that the sale of any Shares received upon exercise of the Option will be subject to, and must comply with, any trading policy as the Company may have in effect from time to time and all applicable securities laws.
  
 12. Governing Law. This Agreement shall be governed and construed in accordance with the laws of the State of Delaware without regard to the conflict of law principles thereof.
  
 13. Cost. The Company shall bear all expenses incurred in administering this Agreement, including expenses related to the issuance of Shares on exercise of Options.
  
 14. Successor and Assigns. This Agreement shall be binding upon and inured to the benefit of the heirs of Optionee and any successor or successors of the Company.
  
 15. Article and Section Headings. Article and section headings contained herein are included for convenience only and are not to be used in construing or interpreting the Plan.
  
 	 
	-5-
	

	 

  
 IN WITNESS WHEREOF, Optionee and Company have executed this Agreement as of the effective date.
  
 	 TRANSWORLD HOLDINGS, INC.
	  
	 OPTIONEE:
	  

	  
	  
	  
	  

	 /s/ Kenneth Orr
	  
	 /s/ Peggy Schuurman Hess
	  

	 By: Kenneth Orr, President
	  
	 PEGGY SCHUURMAN HESS
	  

  
 	 
	 -6-

	

	 

  
 Exhibit A
  
 The Optionee agree to the imprinting, so long as is required by under applicable securities laws, of a legend on any of the Shares in substantially the following form:
  
 [NEITHER] THIS SECURITY [NOR THE SECURITIES INTO WHICH THIS SECURITY IS [EXERCISABLE] [CONVERTIBLE]] HAS [NOT] BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.
  
 	 
	-7-

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