Document:

Starz_Exhibit 10.1 _09.30.2013

EXHIBIT 10.1

EXECUTION COPY

EMPLOYMENT AGREEMENT
This Employment Agreement (the “Agreement”), made effective as of January 1, 2013, is entered into by and between Starz, a Delaware corporation, with its corporate headquarters and principal place of business located at 8900 Liberty Circle, Englewood, Colorado (the “Company”), and Christopher Albrecht (“Executive”).
INTRODUCTION
This Agreement supersedes in its entirety the Employment Agreement dated as of January 1, 2010 and amended December 7, 2012 between Starz, LLC and Executive (the “Original Employment Agreement”) with respect to the period from and after January 1, 2013.  For the avoidance of doubt, references to Executive’s “Employment Agreement” in the award agreements for equity awards granted to Executive prior to January 1, 2013 mean the Original Employment Agreement.
The Company, through its subsidiaries (“Subsidiaries”), is engaged in the business of providing premium movie channels for distribution in the United States, creating and distributing animated and live-action programming, distributing home video/DVD products and producing feature-length films.  The Company desires to employ Executive, and Executive desires to accept such employment, under the terms and conditions set forth herein.
Capitalized terms used in this Agreement shall have the meanings indicated in the preamble, introduction and sections hereof.  For ease of reference, an index to such terms is contained in Section 6.15 of this Agreement.
NOW, THEREFORE, in consideration of the premises and mutual covenants herein contained and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I 
 
EMPLOYMENT; TERM; DUTIES
1.1    Employment.  Upon the terms and conditions hereinafter set forth, the Company hereby employs Executive, and Executive hereby accepts employment, as Chief Executive Officer of the Company.
1.2    Term.  Subject to Article IV below, Executive’s employment hereunder shall be for a term of four years commencing effective as of January 1, 2013 (the “Effective Date”), and expiring at the close of business on December 31, 2016 (the “Initial Term”).  Thereafter, Executive’s employment hereunder shall continue from year to year (any such year-to-year term being referred to herein as an “Extended Term”)  until and unless either party gives to the other written notice of non-renewal at least 180 days prior to the expiration of the Initial Term or any Extended Term of this Agreement or unless Executive’s employment is sooner terminated in accordance with the provisions of this Agreement.  The period of time from the Effective Date until the expiration or termination of the term 

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of Executive’s employment under this Agreement, whether such expiration or termination occurs during or at the end of the Initial Term or any Extended Term, is referred to herein as the “Term.”
1.3    Duties.  During the Term, Executive shall perform such executive duties for the Company and its Subsidiaries as are consistent with his positions hereunder.  Executive shall devote 100% of his business time, attention and energies to the performance of his duties hereunder.  Executive shall use his best efforts to advance the interests and business of the Company and its Subsidiaries.  Executive shall abide by all rules, regulations and policies of the Company of which Executive has received written notice as may be in effect from time to time.  Notwithstanding the foregoing, during the Term Executive may (i) act for his own account in passive-type investments as provided in Section 5.3 or, with the Company’s consent (not to be unreasonably withheld), as a member of boards of directors of other companies, and (ii) provide consulting services relating to the projects listed on Exhibit A hereto (each, a “Project”) if and at such time as such Project goes into production, provided that, in each of the foregoing cases, the time allocated for such activities does not interfere with or create a conflict of interest with the discharge of Executive’s duties for the Company.
1.4    Reporting.  Executive shall report directly to the Chairman of the board of directors (or other similar governing body) of the Company (the “Board”) and to the Board.
1.5    Location.  Except for services rendered during business trips as may be reasonably necessary, Executive shall render his services under this Agreement primarily from the offices of the Company in Los Angeles, California and periodically from the offices of the Company in Englewood, Colorado.  Executive shall not be required to relocate his principal residence from the Los Angeles, California metropolitan area to the Englewood, Colorado metropolitan area during the Term.  The Company and Executive shall agree on a reasonable budget for Executive’s travel between Los Angeles and Englewood as necessary for the conduct of the Company’s business and the performance of Executive’s duties hereunder.
1.6    No Conflicting Agreement.  Executive represents and warrants to the Company that there are no agreements or arrangements, whether written or oral, in effect that would prevent Executive from rendering his services exclusively to the Company during the Term (except to the extent otherwise permitted under Section 1.3 hereof)  in accordance with the provisions of this Agreement.  
 
ARTICLE II
COMPENSATION
2.1    Compensation.  For all services rendered by Executive hereunder and all covenants and conditions undertaken by him pursuant to this Agreement, the Company shall pay, and Executive shall accept, as full compensation, the amounts set forth in this Article II.
2.2    Base Salary.  The base salary shall be an annual salary of $1,250,000 (the “Base Salary”), payable by the Company in accordance with the Company’s normal payroll practices.   
2.3    Bonus.  For each fiscal year during the Term, in addition to the Base Salary, provided that Executive is employed by the Company on the date of payment thereof, Executive shall be eligible 

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for a discretionary annual bonus (the “Bonus”) of 100% of Executive’s annual Base Salary (the “Target Bonus”) based upon achievement of corporate and individual performance criteria to be determined by the compensation committee (the “Committee”) of the Board.  Executive’s entitlement to any Bonus will be determined by the Committee in its sole discretion.  Nothing in this Agreement shall be construed to guarantee the payment of any Bonus to Executive.   
2.4    Deductions.  The Company shall deduct from the compensation described in Sections 2.2 and 2.3, and from any other compensation payable pursuant to this Agreement, any federal, state or local withholding taxes and any other amounts which may be required to be deducted or withheld by the Company pursuant to any federal, state or local laws, rules or regulations.
2.5    Disability Adjustment.  Any compensation otherwise payable to Executive pursuant to Sections 2.2 and 2.3 in respect of any period during which Executive is Disabled (as contemplated in Section 4.4) shall be reduced by any amounts payable to Executive for loss of earnings or the like under any insurance plan or policy sponsored by the Company or any affiliate of the Company or under any program of the United States or the State of California, such as Social Security Disability Insurance or California State Disability Insurance.
 
ARTICLE III
 
BENEFITS; EXPENSES
3.1    Benefits.  Executive will be entitled to participate in such group life, health, accident, disability or hospitalization insurance plans and retirement plans (the “Company Plans”), and to receive such other benefits and perquisites, as the Company may make available to its other senior executive employees as a group.  Executive’s participation in any Company Plans and receipt of such other benefits and perquisites shall be at a level, and on terms and conditions, that are commensurate with his positions and responsibilities at the Company but are no less favorable than those made available to other senior executives of the Company as a group.  
3.2    Expenses.  The Company agrees that Executive is authorized to incur reasonable and appropriate expenses in the performance of his duties hereunder and in promoting the business of the Company and to be reimbursed therefor in accordance with the terms of the Company’s Travel & Entertainment Policy (as the same may be modified or amended by the Company from time to time in its sole discretion).  
3.3    Vacation.  Executive shall accrue, pro rata on a pay period by pay period basis, a total of one hundred sixty (160) hours of vacation per year following the date of this Agreement.  If, at any time during the Term, Executive accumulates two hundred eighty (280) hours of earned but unused vacation time (the “Accrual Cap”), Executive will not accrue additional vacation time until he has taken a portion of the previously earned vacation.  Executive will again accrue paid vacation time when his accumulated amount of earned but unused vacation time falls below the Accrual Cap.  Upon termination of Executive’s employment, any accrued but unused vacation time will be paid to Executive.  

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3.4    Key Man Insurance.  The Company may secure in its own name or otherwise, and at its own expense, life, health, accident and other insurance covering Executive alone or with others, and Executive shall not have any right, title or interest in or to such insurance other than as expressly provided herein.  Executive agrees to assist the Company in procuring such insurance by submitting to usual and customary medical and other examinations to be conducted by such physicians as the Company or such insurance company may designate and by signing such applications and other written instruments as may be required by the insurance companies to which application is made for such insurance.  Executive’s failure to submit to such usual and customary medical and other examinations shall be deemed a material breach of this Agreement.
3.5    Equity Awards.  As part of the consideration for Executive’s services to the Company during the Term, the Company has granted to Executive pursuant to the Company’s 2011 Incentive Plan the equity awards evidenced by and described in the nonqualified stock option agreement attached hereto as Exhibit B (together with the award agreements attached to the Original Employment Agreement, the “Award Agreements”).  It is not anticipated that any additional equity awards will be granted to Executive during the Initial Term.
 
ARTICLE IV
 
TERMINATION; DEATH; DISABILITY
4.1    Termination of Employment For Cause.  In addition to any other remedies available to the Company at law, in equity or as set forth in this Agreement, the Company shall have the right, upon written notice to Executive, to terminate Executive’s employment hereunder at any time for “Cause” (a “Termination For Cause”).  In the event of a Termination For Cause, Executive’s employment will terminate and the Company shall have no further liability or obligation to Executive hereunder or otherwise (other than the Company’s obligation to pay Base Salary and vacation time accrued but unpaid as of the date of termination, reimbursement of expenses incurred on or prior to the date of termination in accordance with Section 3.2 above and any other amounts legally required to be paid).  
For purposes of this Agreement, prior to the occurrence of a Corporate Event (as defined below), “Cause” shall mean:  (a) any act or omission that constitutes a breach by Executive of any of his material obligations under this Agreement; (b) the continued failure or refusal of Executive, other than on account of death or Disability of Executive, (i) to substantially perform the material duties required of him as Chief Executive Officer of the Company and/or (ii) to comply with reasonable directions of the Chairman of the Board or the Board; (c) any material violation by Executive of any (i) policy, rule or regulation of the Company or (ii) any law or regulation applicable to the business of the Company or any of its affiliates; (d) Executive’s conviction of, or plea of guilty or nolo contendere to, any crime (whether or not involving the Company) that constitutes a felony or crime of moral turpitude or is punishable by imprisonment of 30 days or more, provided, however, that nothing in this Agreement shall obligate the Company to pay Base Salary or any Bonus or benefits during any period that Executive is unable to perform his duties hereunder due to any incarceration; or (e) any other intentional misconduct by Executive that has a material detrimental effect on the financial condition or business reputation of the Company or any of its affiliates.  Following the occurrence of a Corporate Event, “Cause” shall have the meaning given such term under California law. 

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Notwithstanding the foregoing, no purported Termination For Cause pursuant to (a), (b) or (c) of the preceding paragraph of this Section 4.1 shall be effective unless all of the following provisions shall have been complied with:  (i) Executive shall be given written notice by the Company of its intention to effect a Termination For Cause, such notice to state in detail the particular circumstances that constitute the grounds on which the proposed Termination For Cause is based; and (ii) Executive shall have 30 days after receiving such notice in which to cure such grounds.  If Executive cures such grounds to the reasonable satisfaction of the Company within such 30-day period, the Company shall not be entitled to effect a Termination For Cause based on such grounds.
For purposes of this Agreement, a “Corporate Event” means the occurrence of an event during the Term that results in (a) the Company no longer having publicly traded equity securities, or (b) the acquisition by a third party, directly or indirectly, of more than 50% of the voting power of the Company’s equity securities, unless, in either event, the directors prior to the acquisition and the individuals nominated for election as directors by the board of directors continue to constitute more than 50% of the directors of (i) the Company, or (ii) the entity resulting from such event.  Notwithstanding the foregoing, “Corporate Event” will not include a direct or indirect spin-off or split-off of the Company, however effected (including, for example, by a pro rata distribution or an exchange offer), nor a transfer of equity of the Company to any affiliate of the Company.
4.2    Termination of Employment Without Cause.  During the Term, the Company may at any time, in its sole discretion, terminate the employment of Executive hereunder for any reason (other than those set forth in Section 4.1 above) or for no reason upon written notice (the “Termination Notice”) to Executive (a “Termination Without Cause”).  In such event, Executive shall be entitled to the following:
		
	(a)
	any Base Salary and vacation time accrued but unpaid as of the date of termination;

		
	(b)
	any reimbursement for expenses incurred on or prior to the date of termination in accordance with Section 3.2; and

		
	(c)
	subject to Sections 4.6, 4.7 and 4.8 below, provided that such Termination Without Cause constitutes a Separation from Service of Executive (as defined in Section 4.8 below), and further provided that Executive does not engage in Competitive Activities during the Severance Period:

(i)    payment of amounts (“Severance Installments”) representing continuation of Executive’s Base Salary as in effect at the date of such Termination Without Cause until the earlier of (A) the date that is 18 months following the date of termination, or (B) the date on which the Initial Term or the then-current Extended Term, as applicable, would have expired had such termination not occurred (such period, the “Severance Period”), which Severance Installments shall be payable in such amounts and on such dates as such amounts otherwise would be payable based on the Company’s payroll schedule in effect at the date of termination and shall be treated as a series of separate payments for purposes of Code Section 409A (as defined in Section 4.8 below); and

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(ii)    an amount (the “Severance Lump-Sum Payment”) equal to 1.5 times Executive’s Base Salary for the year in which such Termination Without Cause occurs; provided that if such Termination Without Cause occurs during the last 12 months of the Term, the amount of the Severance Lump-Sum Payment shall be equal to Executive’s Base Salary for the year in which such Termination Without Cause occurs, which Severance Lump-Sum Payment shall be payable in a lump sum within 60 days following the date of termination of Executive’s employment and which Severance Lump-Sum Payment shall be in complete satisfaction of any Target Bonus or other bonus amount to which Executive may otherwise be entitled for any period.
In addition, subject to Sections 4.6, 4.7 and 4.8 below, and provided that such Termination Without Cause constitutes a Separation from Service of Executive (as defined in Section 4.8 below), if Executive elects continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), the Company shall contribute to the health plan maintained by the Company that provides coverage for employees of the Company (including Executive and his dependents) as of the date of termination, or any such successor plan maintained by the Company (the “Health Plan”), that amount that reflects the proportionate part of the premium for such coverage that is paid by the Company as of the date of termination (the “Benefits Payments”) throughout the period beginning on the date of termination and ending on the earliest of (i) the date that is 18 months following the date of termination, (ii) the expiration of the coverage period specified under COBRA, such period to be determined as of the date of termination, or (iii) the date on which the Initial Term or the then-current Extended Term, as applicable, would have expired had such termination not occurred (the “Reimbursement Period”).  Subject to Section 4.8 below, such Benefits Payments shall be made monthly in accordance with the Company’s normal procedures for the payment of Health Plan premiums.  Executive shall bear responsibility for that portion of the Health Plan premiums in excess of the Benefits Payments.  Notwithstanding the foregoing, if Executive becomes employed with another employer during the Reimbursement Period and is eligible to receive health and/or medical benefits under any plan(s) provided by such other employer, the Company’s contribution obligation under this paragraph shall be reduced to the extent that coverage is provided under such other employer’s plan(s). Executive shall not be entitled to receive reimbursement of any medical expenses under the Health Plan to the extent such medical expenses are reimbursed by any other Person, including, without limitation, such other employer.  Executive shall be responsible for paying any United States federal or state income taxes associated with the Benefits Payments.
Notwithstanding the foregoing, if Executive elects, during the Severance Period, to engage in any Competitive Activity, Executive shall deliver to the Company at least ten business days prior to commencing any such Competitive Activities a written notice advising the Company of (i) Executive’s intent to commence Competitive Activities, and (ii) the commencement date for such Competitive Activities (the “Competition Notice”).  Executive’s election to participate in any Competitive Activities during the Severance Period shall not be deemed a breach of this Agreement; rather, if Executive engages in Competitive Activities prior to the expiration of the Severance Period, the Company shall have no obligation to make any further payment to or for the benefit of Executive of any Severance Installments (except to the extent Severance Installments at least equal to the Release Consideration have not theretofore been paid), Severance Lump-Sum Payment or Benefits Payments.

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Executive acknowledges that the payments and benefits described in this Section 4.2, together with any rights or benefits under any written plan or agreement (including the Award Agreements) that have vested on or prior to the termination date of Executive’s employment under this Section 4.2, constitute the only payments that Executive shall be entitled to receive from the Company hereunder or otherwise in the event of any termination of his employment pursuant to this Section 4.2, and the Company shall have no further liability or obligation to him hereunder or otherwise in respect of his employment or the termination thereof.  
The Company and Executive acknowledge and agree that the delivery by the Company of a notice of non-renewal pursuant to Section 1.2 above shall not be a Termination Notice giving rise to a Termination Without Cause pursuant to this Section 4.2.  Following delivery by the Company or the Executive of a notice of non-renewal pursuant to Section 1.2 above, unless earlier terminated pursuant to Section 4.1, 4.2, 4.3 or 4.4 hereof, Executive’s employment hereunder shall continue until the last day of the Initial Term or the then-current Extended Term, as applicable, whereupon Executive’s employment hereunder shall cease (the “Cessation Date”).  In such event, the Company shall pay Executive an amount equal to the sum of (i) any Base Salary and unused vacation time  accrued but unpaid as of the Cessation Date, plus (ii) any reimbursement for expenses incurred on or prior to the Cessation Date in accordance with Section 3.2.  Executive acknowledges that the payments referred to in this paragraph, together with any rights or benefits under any written plan or agreement that have vested on or prior to the Cessation Date, constitute the only payments and benefits that Executive (or his legal representative, as the case may be) shall be entitled to receive from the Company hereunder or otherwise in the event of the expiration of the Term following delivery of a notice of non-renewal, and the Company shall have no further liability or obligation to him (or his legal representative, as the case may be) hereunder or otherwise in respect of his employment or the termination thereof.
4.3    Termination of Employment With Good Reason.  In addition to any other remedies available to Executive at law, in equity or as set forth in this Agreement, Executive shall have the right during the Term, upon written notice to the Company, to terminate his employment hereunder upon the occurrence of any of the following events without the prior consent of Executive: (a) a reduction in Executive’s then current Base Salary or level of Target Bonus; (b) a significant reduction in Executive’s title, duties or reporting relationship with the Company or the assignment to Executive of duties that are inconsistent with Executive’s position with the Company; (c) relocation of the Company’s Los Angeles office more than 50 miles away from Beverly Hills, California; or (e) a material breach by the Company of any provision of this Agreement (a “Termination With Good Reason”), provided, however, that the disposition during the Term of any or all of the equity or business of Starz Media, LLC, however effected, will not constitute an event giving Executive the right to terminate his employment hereunder pursuant to a Termination With Good Reason.  
Notwithstanding the foregoing, no purported Termination With Good Reason pursuant to this Section 4.3 shall be effective unless all of the following provisions shall have been complied with: (i) Executive shall give the Company a written notice of Executive’s intention to effect a Termination With Good Reason, such notice to state in detail the particular circumstances that constitute the grounds on which the proposed Termination With Good Reason is based and to be given no later than 90 days after the initial occurrence of such circumstances; (ii) the Company shall have 30 days after receiving such notice in which to cure such grounds; and (iii) if the Company fails, within such 30-day period, to cure such grounds to Executive’s reasonable satisfaction, Executive terminates his employment 

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hereunder within 30 days following the last day of such 30-day period.  If the Company timely cures such grounds in accordance with the preceding sentence, Executive shall not be entitled to terminate his employment pursuant to a Termination With Good Reason based on such grounds.
If a Termination With Good Reason occurs, Executive shall have the same entitlement to the payments and benefits as provided under Section 4.2 for a Termination Without Cause, subject to the conditions set forth in Section 4.2 relating to such payments and benefits.
Executive acknowledges that the payments and benefits referred to in this Section 4.3, together with any rights or benefits under any written plan or agreement (including the Award Agreements) that have vested on or prior to the termination date of Executive’s employment under this Section 4.3, constitute the only payments that Executive shall be entitled to receive from the Company hereunder or otherwise in the event of any termination of his employment pursuant to this Section 4.3, and the Company shall have no further liability or obligation to him hereunder or otherwise in respect of his employment or the termination thereof.  Executive further acknowledges that if Executive voluntarily terminates his employment hereunder other than pursuant to a Termination With Good Reason (a “Voluntary Termination”), the Company shall have no further liability or obligation to Executive hereunder or otherwise, other than with respect to any rights or benefits under any written plan or agreement (including the Award Agreements) that have vested on or prior to the date of such Voluntary Termination, the Company’s obligation to pay Base Salary and vacation time accrued but unpaid as of the date of such Voluntary Termination, reimbursement of expenses incurred on or prior to the date of such Voluntary Termination in accordance with Section 3.2 above and any other amounts legally required to be paid.
4.4    Death; Disability.  If Executive dies or becomes Disabled during the Term, Executive’s employment hereunder shall terminate automatically, and the Company shall pay Executive (or his legal representative, as the case may be) the following:
		
	(a)
	any Base Salary and vacation time accrued but unpaid as of the date of such termination;

		
	(b)
	any reimbursement for expenses incurred on or prior to the date of such termination in accordance with Section 3.2; 

		
	(c)
	subject to Sections 4.6, 4.7 and 4.8 below, provided that such termination of employment constitutes a Separation from Service of Executive (as defined in Section 4.8 below), an amount (the “Severance Amount”), payable in a single sum within 60 days following the date of such termination of employment, equal to the sum of (i) Executive’s annual Base Salary as in effect at the date of Executive’s death or Disability, multiplied by a fraction, the numerator of which is the number of days that would have remained in the Initial Term or the then-current Extended Term, as applicable, had such termination of employment not occurred and the denominator of which is the number of days in the Initial Term or the then-current Extended Term, as applicable, plus (ii) Executive’s Base Salary for the fiscal year in which Executive’s death or Disability occurs, multiplied by a fraction, the numerator of which is the number of days during 

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such fiscal year preceding the date of Executive’s death or Disability and the denominator of which is the total number of days in such fiscal year.
For purposes of this Agreement, Executive shall be deemed to be “Disabled” or have a “Disability” if, because of Executive’s physical or mental disability, he has been substantially unable to perform his duties hereunder for 16 work weeks in any 12-month period.  Executive shall be considered to have been substantially unable to perform his duties hereunder only if he is either (a) unable to reasonably and effectively carry out his duties with reasonable accommodations by the Company or (b) unable to reasonably and effectively carry out his duties because any reasonable accommodation which may be required would cause the Company undue hardship.  In the event of a disagreement concerning Executive’s perceived Disability, Executive shall submit to such examinations as are deemed appropriate by three practicing physicians specializing in the area of Executive’s Disability, one selected by Executive, one selected by the Company, and one selected by both such physicians.  The majority decision of such three physicians shall be final and binding on the parties.
Executive acknowledges that the payments referred to in this Section 4.4, together with any rights or benefits under any written plan or agreement (including the Award Agreements) which have vested on or prior to the termination date of Executive’s employment under this Section 4.4, constitute the only payments which Executive (or his legal representative, as the case may be) shall be entitled to receive from the Company hereunder in the event of Executive’s death or Disability during the Term and the consequent termination of Executive’s employment hereunder, and the Company shall have no further liability or obligation to him (or his legal representative, as the case may be) hereunder or otherwise in respect of his employment or the termination thereof.
4.5    No Mitigation by Executive.  Executive shall not be required to mitigate the amount of any payment provided for in this Agreement by seeking other employment or otherwise, nor shall the amount of any payment provided for herein be reduced by any compensation earned by Executive or benefits provided to Executive as the result of his employment by another employer except as otherwise provided in Section 4.2.
4.6    Severance Agreement and Release.  If Executive’s employment hereunder is terminated pursuant to a Termination Without Cause (as defined in Section 4.2 above) or a Termination With Good Reason (as defined in Section 4.3 above), or on account of Executive’s Disability (as defined in Section 4.4 above), payment by the Company of the amounts described in said sections shall be subject to the execution and delivery to the Company by Executive (or by Executive’s legal representative, if applicable), within the applicable time period described below, of a severance agreement and release (the “Release”) in a form that is reasonably satisfactory to the Company and consistent with the form of severance agreement and release then used by the Company for senior executives. 
The Release shall be delivered to Executive, in the case of a Termination Without Cause, at the time of delivery of the Termination Notice, in the case of a Termination With Good Reason, upon delivery of written notice by Executive to the Company, and in the case of Executive’s Disability, as soon as reasonably practicable following the date on which Executive’s Disability occurs.  Executive shall have a period of 21 days (or, if required by applicable law, a period of 45 days) after the effective date of termination of Executive’s employment hereunder (the “Consideration Period”) in which to execute and return the original, signed Release to the Company.  If Executive delivers the original, 

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signed Release to the Company prior to the expiration of the Consideration Period and does not thereafter revoke such Release within the seven-day period immediately following the Consideration Period as provided therefor under applicable law (such seven-day period, the “Revocation Period”), Executive shall, subject to Section 4.7 below, be entitled to the Severance Installments, Severance Lump-Sum Payment and Benefits Payments as described in Section 4.2 (including by reason of Section 4.3, if applicable) or the Severance Amount described in Section 4.4(c), as applicable.   In such event, aggregate Severance Installments or that portion of the Severance Amount, as applicable, equal to one-twelfth of Executive’s Base Salary in effect at the date of termination of Executive’s employment hereunder shall constitute consideration for Executive’s delivery of the Release pursuant to this Section 4.6 (the “Release Consideration”).  
If Executive does not deliver the original, signed Release to the Company prior to the expiration of the Consideration Period, or if Executive delivers the original, signed Release to the Company prior to the expiration of the Consideration Period and thereafter revokes such Release within any period of time provided therefor under applicable law, then:
		
	(a)
	the Company shall pay Executive an amount equal to the sum of (i) any Base Salary and vacation time accrued but unpaid as of the date of termination, plus (ii) any reimbursement for expenses incurred on or prior to the date of termination in accordance with Section 3.2; and

		
	(b)
	the Company shall have no obligation to pay to Executive the Severance Installments, Severance Lump-Sum Payment and Benefits Payments or the Severance Amount.

4.7    Continued Compliance.  Executive and the Company hereby acknowledge that any Severance Installment, Severance Lump-Sum Payment or Benefits Payment payable by the Company under Section 4.2 (including by reason of Section 4.3) or Severance Amount payable by the Company under Section 4.4(c) are part of the consideration for Executive’s undertakings under Article V below.  Such amounts are subject to Executive’s continued compliance with the provisions of Article V.  If Executive violates the provisions of Article V, then the Company will have no obligation to pay or make any of the Severance Installments, Severance Lump-Sum Payment or Benefits Payments or the Severance Amount to the extent any or all of the same remain payable by the Company under Section 4.2 (including by reason of Section 4.3) or 4.4 on or after the date of such violation, except to the extent of any unpaid Release Consideration.   
4.8    Timing of Payments Under Certain Circumstances.  With respect to any amount that becomes payable to or for the benefit of Executive under this Agreement upon Executive’s Separation from Service (as defined below) for any reason, the provisions of this Section 4.8 will apply, notwithstanding any other provision of this Agreement to the contrary.  If the Company determines in good faith that Executive is a “specified employee” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended, including any Treasury regulations promulgated thereunder and any guidance issued by the Internal Revenue Service with respect thereto (collectively, “Code Section 409A”), then to the extent required under Code Section 409A, payment of any amount of deferred compensation that becomes payable to or for the benefit of Executive upon Separation from Service (other than by reason of the death of Executive) and that otherwise would be payable during the six-month period following Executive’s Separation from Service shall be suspended until the lapse of such 

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six-month period (or, if earlier, the date of Executive’s death).  A “Separation from Service” of Executive means Executive’s separation from service, as defined in Code Section 409A, with the Company and all other Persons with which the Company would be considered a single employer under Internal Revenue Code Section 414(b) or (c), applying the 80% threshold used in such Internal Revenue Code Sections or any Treasury regulations promulgated thereunder.  Any payment suspended as provided in this Section 4.8, unadjusted for interest on such suspended payment, shall be paid to Executive in a single payment on the first business day following the end of such six-month period or within 30 days following the death of Executive, as applicable, provided that the death of Executive during such six-month period shall not cause the acceleration of any amount that otherwise would be payable on any date during such six-month period following the date of Executive’s death.
 
ARTICLE V
 
OWNERSHIP OF PROCEEDS 
 OF EMPLOYMENT; NON-DISCLOSURE; 
NON-COMPETITION
5.1    Ownership of Proceeds of Employment.  The Company shall be the sole and exclusive owner throughout the universe in perpetuity of all of the results and proceeds of Executive’s services, work and labor in connection with Executive’s employment by the Company, free and clear of any and all claims, liens or encumbrances. Executive shall promptly and fully disclose to the Company, with all necessary detail for a complete understanding of the same, any and all developments, client and potential client lists, know how, discoveries, inventions, improvements, conceptions, ideas, writings, processes, formulae, contracts, methods, works, whether or not patentable or copyrightable, which are conceived, made, acquired, or written by Executive, solely or jointly with another, while employed by the Company (whether or not at the request or upon the suggestion of the Company) and which are substantially related to the business or activities of the Company or any of its Subsidiaries, or which Executive conceives as a result of his employment by the Company or its Subsidiaries, or as a result of rendering advisory or consulting services to the Company or its Subsidiaries (collectively, “Proprietary Rights”).  
Executive hereby assigns and transfers, and agrees to assign and transfer, all his rights, title, and interests in the Proprietary Rights to the Company or its nominee.  In addition, Executive shall deliver to the Company any and all drawings, notes, specifications, and data relating to the Proprietary Rights.  All copyrightable Proprietary Rights shall be considered to be “works made for hire.”  Whenever requested to do so by the Company, Executive shall execute and deliver to the Company any and all applications, assignments and other instruments and do such other acts that the Company shall reasonably request to apply for and obtain patents and/or copyrights in any and all countries or to otherwise protect the Company’s interest in the Proprietary Rights and/or to vest title thereto to the Company; provided, however, the provisions of this Section 5.1 shall not apply to any Proprietary Rights that Executive developed entirely on his own time without using the Company’s equipment, supplies, facilities or proprietary information, except for Proprietary Rights that (a) at the time of conception or reduction to practice of the Proprietary Rights, relate to the Company’s business, or actual or demonstrably anticipated research or development of the Company, or (b) result from any work performed by Executive for the Company. 

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Executive shall assist the Company in obtaining such copyrights and patents during the term of this Agreement, and any time thereafter without cost to the Executive, on reasonable notice and at mutually convenient times; provided, however, Executive shall be reasonably compensated for his time and reimbursed for any out-of-pocket expenses incurred in rendering such assistance or giving or preparing to give such testimony.  Executive agrees to testify in any prosecution or litigation involving any of the Proprietary Rights.
Contemporaneously with the execution and delivery of this Agreement, Executive is executing and delivering an acknowledgment under Section 2870 of the California Labor Code in the form of Exhibit C hereto, the provisions of which are incorporated herein by reference.
5.2    Non-Disclosure of Confidential Information.  As used herein, “Confidential Information” means any and all non-public information as to which the Company takes reasonable steps to protect the confidentiality of and that affects or relates to the business of the Company and its Subsidiaries, including, without limitation: (a) financial data, customer lists and data, licensing arrangements, business strategies, pricing information, product development, intellectual, artistic, literary, dramatic or musical rights, works, or other materials of any kind or nature (whether or not entitled to protection under applicable copyright laws, or reduced to or embodied in any medium or tangible form), including, without limitation, all copyrights, patents, trademarks, service marks, trade secrets, contract rights, titles, themes, stories, treatments, ideas, concepts, technologies, art work, logos, hardware, and software; (b) such information as may be embodied in any and all computer programs, tapes, diskettes, disks, mailing lists, lists of actual or prospective customers and/or suppliers, notebooks, documents, memoranda, reports, files, correspondence, charts and lists; and (c) all other written, printed or otherwise recorded material of any kind whatsoever and any other information, whether or not reduced to writing, including “know-how,” ideas, concepts, research, processes, and plans.  “Confidential Information” does not include information relating to Executive’s working conditions or wages, information that is in the public domain, information that is generally known in the trade, or information that Executive can prove he acquired wholly independently of his employment with the Company.  Executive shall not, at any time during the Term or thereafter, directly or indirectly, disclose or furnish to, or use for the benefit of, any other person, firm or corporation any Confidential Information, except in the course of the proper performance of his duties hereunder or as required by law (in which event Executive shall give prior written notice to the Company and shall cooperate with the Company and the Company’s counsel in complying with such legal requirements).  Promptly upon the expiration or termination of Executive’s employment hereunder for any reason or whenever the Company so requests, Executive shall surrender to the Company all documents, drawings, work papers, lists, memoranda, records and other data (including all copies, compilations or summaries thereof) constituting or pertaining in any way to any of the Confidential Information, other than Executive’s personal “rolodex” or equivalent and any personal information contained on Executive’s computer(s); provided, however, that Executive acknowledges if he chooses to import or maintain any personal information on the Company’s computers or network, he does not have any reasonable expectation of privacy vis-à-vis the Company with respect to such information, and the Company may access and review such information at any time, for any reason.
5.3    Non-Competition.  During the Term, Executive shall not, directly or indirectly, compete with the Company (i.e., by being employed as an executive by, or otherwise providing services as an executive to, any Person (a “Competing Entity”) having an interest in, engaging in or participating in 

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the ownership, management, operation or control of, or acting in any advisory capacity or other capacity to, any premium pay television service operating in the United States (collectively, “Competitive Activities”), or solicit or divert any business or any customer from the Company or assist any Person in doing so or attempting to do so, or cause or seek to cause any Person to refrain from dealing or doing business with the Company or assist any Person in doing so or attempting to do so.  Notwithstanding the foregoing, Executive may make solely passive investments in any Competing Entity, the common stock of which is “publicly held,” and of which Executive shall not own or control, directly or indirectly, in the aggregate, securities that constitute more than one percent of the voting rights or equity ownership of such Competing Entity.     
5.4    Non-Solicitation.  Executive shall not, for a period of two years from the date of any termination of his employment hereunder except a Termination Without Cause or a Termination With Good Reason solicit or induce, directly or indirectly, or cause or authorize others to solicit or induce, directly or indirectly, any person employed by the Company or any Subsidiary to leave employment with the Company.
5.5    Breach of Provisions.  If Executive shall breach any of the provisions of this Article V, or if any such breach is threatened by Executive, in addition to and without limiting or waiving any other rights or remedies available to the Company at law or in equity, unless otherwise prohibited by applicable law, the Company shall be entitled to immediate injunctive relief in any court, domestic or foreign, having the capacity to grant such relief, without the necessity of posting a bond, to restrain any such breach or threatened breach and to enforce the provisions of this Article V. Executive acknowledges and agrees that there is no adequate remedy at law for any such breach or threatened breach and, if any action or proceeding is brought seeking injunctive relief, Executive shall not use as a defense thereto that there is an adequate remedy at law.
5.6    Reasonable Restrictions.  The parties acknowledge that the foregoing restrictions, the duration and the territorial scope thereof as set forth in this Article V, are under all of the circumstances reasonable and necessary for the protection of the Company and its business.
5.7    Definition.  For purposes of this Article V, the term “Company” shall be deemed to include (i) any predecessor to, or successor of, the Company, (ii) any Subsidiary of the Company (including, without limitation, any Person in which the Company owns, directly or indirectly, 50% or more of the issued and outstanding equity), and (iii) any Person that is under the Control or common Control of the Company (including, by way of illustration and not as a limitation, any joint venture to which the Company or one of its Subsidiaries is a party).  For purposes of this Agreement, “Control” shall mean the power to direct the management and policies of a Person, whether by ownership of voting securities, by contract or otherwise, and “Person” shall mean any individual or any corporation, partnership, trust, unincorporated organization, association, limited liability company or other entity.
 
ARTICLE VI
 
MISCELLANEOUS

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6.1    Binding Effect.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective legal representatives, heirs, distributees, successors and assigns.
6.2    Assignment.  The Company may assign this Agreement to any successor in interest to its business, and Executive hereby agrees to be employed by such assignee as though such assignee were originally the employer named herein.  Executive hereby acknowledges that the services to be rendered by Executive are unique and personal, and, accordingly, Executive may not assign any of his rights or delegate any of his duties or obligations under this Agreement.
6.3    Notices.  All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed to have been duly given:  (a) on the date of service if served personally on the party to whom notice is to be given; (b) on the day of transmission if sent via facsimile transmission to the facsimile number given below, and telephonic confirmation of receipt is obtained promptly after completion of transmission; (c) on the day of transmission if sent via electronic mail to the electronic mail address given below; (d) on the day after delivery by Federal Express or similar overnight courier or the Express Mail service maintained by the United States Postal Service; or (e) on the fifth day after mailing, if mailed to the party to whom notice is to be given, by first class mail, registered or certified, postage prepaid and properly addressed, to the party as follows:
		
	(a)
	If to the Company:

Starz
8900 Liberty Circle
Englewood, CO   80112
Attention:  General Counsel 
    
and

Sherman & Howard L.L.C.
633 Seventeenth Street, Suite 3000
Denver, CO   80202
 

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	(b)
	If to Executive:

Christopher Albrecht
            
 

With a copy to:

Ziffren Brittenham LLP
1801 Century Park West
Los Angeles, CA 90067-6406
            

And:

Geibelson Young & Company
21700 Oxford Street  Suite 2030
Woodland Hills, CA   91367
            

Notwithstanding the foregoing, any notice of change of address of a party shall be effective only upon actual receipt by the other party hereto.
6.4    Severability.  If any provision of this Agreement, or portion thereof, shall be held invalid or unenforceable by a court of competent jurisdiction, such invalidity or unenforceability shall attach only to such provision or portion thereof, and shall not in any manner affect or render invalid or unenforceable any other provision of this Agreement or portion thereof, and this Agreement shall be carried out as if any such invalid or unenforceable provision or portion thereof were not contained herein.  In addition, any such invalid or unenforceable provision or portion thereof shall be deemed, without further action on the part of the parties hereto, modified, amended or limited to the extent necessary to render the same valid and enforceable.
6.5    Confidentiality.  Executive agrees that, unless such disclosure is expressly permitted by applicable law, he will not, during the Term or thereafter, disclose to any other Person the terms or conditions of this Agreement (excluding the financial terms hereof) without the prior written consent of the Company.  Approval of the Company and of Executive shall be required with respect to any press releases regarding this Agreement and the activities of Executive contemplated hereunder.  
6.6    Arbitration.  Other than any action to obtain injunctive relief relating to the matters set forth in Article 5 of this Agreement, if any controversy, claim or dispute arises out of or in any way relates to this Agreement, the alleged breach thereof, Executive’s employment with the Company or termination therefrom, including, without limitation, any and all claims for employment discrimination or harassment, civil tort and any other employment laws, excepting only claims that may not, by statute, be arbitrated, both Executive and the Company (and its members, managers, officers, employees or agents) agree to submit any such dispute exclusively to binding arbitration. Both Executive and the Company acknowledge that they are relinquishing their right to a jury trial in civil court. Executive 

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and the Company agree that arbitration is the exclusive remedy for all disputes arising out of or related to Executive’s employment with the Company.
The arbitration shall be subject to the Federal Arbitration Act and shall be administered by JAMS in accordance with the Employment Arbitration Rules & Procedures of JAMS then in effect and subject to JAMS Policy on Employment Arbitration Minimum Standards, except as otherwise  provided in this Agreement. Arbitration shall be commenced and heard in the Los Angeles, California metropolitan area. Only one arbitrator shall preside over the proceedings, who shall be selected by agreement of the parties from a list of five or more qualified arbitrators provided by the arbitration tribunal, or if the parties are unable to agree on an arbitrator within ten business days following receipt of such list, the arbitration tribunal shall select the arbitrator.  The arbitrator shall apply the substantive law (and the law of remedies, if applicable) of California or federal law, or both, as applicable to the claim(s) asserted. In any arbitration, the burden of proof shall be allocated as provided by applicable law. The arbitrator shall have the authority to award any and all legal and equitable relief authorized by the law applicable to the claim(s) being asserted in the arbitration, as if the claim(s) were brought in a federal or state court of law.  Either party may bring an action in court to compel arbitration under this Agreement and to enforce an arbitration award. Discovery, such as depositions or document requests, shall be available to the Company and Executive as though the dispute were pending in federal court. The arbitrator shall have the ability to rule on pre-hearing motions as though the matter were in a federal court, including the ability to rule on a motion for summary judgment.
If permitted by applicable law, the fees of the arbitrator and any other fees for the administration of the arbitration that would not normally be incurred if the action were brought in a court of law (e.g., filing fees, room rental fees, etc.) shall be shared equally by the parties.  If the foregoing is not permitted by applicable law, the fees of the arbitrator and any other fees for the administration of the arbitration that would not normally be incurred if the action were brought in a court of law (e.g., filing fees, room rental fees, etc.) shall be paid by the Company, provided that Executive shall be required to pay the amount of filing fees equal to that which Executive would be required to pay to file an action in California state court.  Each party shall pay its own attorneys’ fees and other costs incurred in connection with the arbitration, unless the relief authorized by law allows otherwise and the arbitrator determines that attorneys’ fees shall be paid in a different manner.  The arbitrator must provide a written decision that is subject to limited judicial review consistent with applicable law. If any part of this arbitration provision is deemed to be unenforceable by an arbitrator or a court of law, that part may be severed or reformed so as to make the balance of this arbitration provision enforceable.
6.7    Waiver.  No waiver by a party hereto of a breach or default hereunder by the other party shall be considered valid unless in writing signed by such first party, and no such waiver shall be deemed a waiver of any subsequent breach or default of the same or any other nature.
6.8    Controlling Nature of Agreement.  To the extent any terms of this Agreement are inconsistent with the terms or provisions of the Company’s Employee Handbook or any other personnel policy statements or documents, the terms of this Agreement shall control.  To the extent that any terms and conditions of Executive’s employment are not covered in this Agreement, the terms and conditions set forth in the Employee Handbook or any similar document shall control such terms.
6.9    Entire Agreement.  This Agreement, including the exhibits hereto, sets forth the entire agreement between the parties with respect to the subject matter hereof, and supersedes any and all 

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prior agreements or understanding between the Company and Executive, whether written or oral, fully or partially performed relating to any or all matters covered by and contained or otherwise dealt with in this Agreement.
6.10    Amendment.  No modification, change or amendment of this Agreement or any of its provisions shall be valid unless in writing and signed by the party against whom such claimed modification, change or amendment is sought to be enforced.
6.11    Authority.  The parties each represent and warrant that they have the power, authority and right to enter into this Agreement and to carry out and perform the terms, covenants and conditions hereof.
6.12    Applicable Law.  This Agreement, and all of the rights and obligations of the parties in connection with the employment relationship established hereby, shall be governed by and construed in accordance with the substantive laws of the State of California without giving effect to principles relating to conflicts of law.
6.13    Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument.
6.14    Compliance with Section 409A  The provisions of this Agreement are intended to satisfy the requirements of Code Section 409A and will be interpreted in a manner that is consistent with such intent so that all payments and reimbursements made and all in-kind benefits provided hereunder are either made or provided in compliance with Code Section 409A or are exempt from the provisions thereof.  The parties intend that, to the maximum extent possible, any Severance Installments and any Severance Lump-Sum Payment paid pursuant to Section 4.2(c) (including by reason of Section 4.3) and any Severance Amount paid pursuant to Section 4.4(c) shall qualify as a short-term deferral pursuant to Treasury Regulation § 1.409A-1(b)(4) or a separation payment pursuant to Treasury Regulation § 1.409A-1(b)(9) and that any Benefits Payments made pursuant to Section 4.2 (including by reason of Section 4.3) shall qualify as reimbursements of medical expenses under a separation pay plan pursuant to Treasury Regulation § 1.409A-1(b)(9)(v)(B).  With respect to any reimbursement or in-kind benefit provided to Executive hereunder that constitutes deferred compensation subject to Code Section 409A, the following provisions shall apply:  (i) the amount of any reimbursements or in-kind benefits provided during any taxable year of Executive shall not affect the expenses eligible for reimbursement or the in-kind benefits provided to Executive in any other taxable year; (ii) reimbursements shall be made only for expenses incurred, and in-kind benefits shall be provided only, during the period expressly set forth in this Agreement; (iii) any reimbursement of eligible expenses must be made on or before the last day of Executive’s taxable year following the taxable year in which the expense was incurred; and (iv) no such reimbursements or in-kind benefits shall be subject to liquidation or exchange for another benefit.  The following provisions of this Section 6.14 shall apply to (a) any Severance Installment otherwise payable within 60 days following the date of termination of Executive’s employment (such 60-day period, the “Initial Payment Period”), (b) the Severance Lump-Sum Payment, and (c) the Severance Amount, but only to the extent that such Severance Installment, Severance Lump-Sum Payment or Severance Amount constitutes nonqualified deferred compensation subject to the provisions of Section 409A (collectively, the “Initial Payments”).  Subject to satisfaction of the requirements of Section 4.6, Section 4.7 and any other provision of this Agreement relating to the payment thereof, each Initial Payment shall be paid to Executive at the time otherwise provided 

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under this Agreement, provided that, if the Initial Payment Period begins in one taxable year of Executive (the “First Taxable Year”) and ends in the following taxable year of Executive (the “Second Taxable Year”), Initial Payments shall be made only during the portion of the Initial Payment Period that occurs during the Second Taxable Year (the “Straddle Rule”).  Subject to Section 4.8, (i) any Severance Installment that would be payable prior to the expiration of the Revocation Period but for the requirements of Section 4.6 and thereafter becomes payable upon satisfaction of the requirements of such section shall be paid to Executive on the first date during the Initial Payment Period following expiration of the Revocation Period on which a Severance Installment otherwise becomes payable (but not later than the last day of the Initial Payment Period and subject to clause (ii) of this sentence), and (ii) any Severance Installment that would be payable during the First Taxable Year but for the Straddle Rule shall paid on the first date during the Initial Payment Period on which a Severance Installment otherwise becomes payable during the Second Taxable Year (or, if no such date occurs, on the first business day of the Second Taxable Year).  The preceding provisions relating to Initial Payments are intended to comply with Section 409A guidance provided under Notice 2010-6 issued on January 19, 2010, as modified by Notice 2010-80 issued on November 30, 2010, relating to payments upon separation from service that are subject to execution and delivery of a release or another employment-related action.
6.15    Defined Terms.  Each capitalized term set forth below is defined in the referenced section of this Agreement.
	
		
	Term
	Section

	Accrual Cap   
	3.3

	Agreement   
	Preamble

	Award Agreements   
	3.5

	Base Salary   
	2.2

	Benefits Payments   
	4.2, ¶ Second

	Bonus   
	2.3

	Cause   
	4.1, ¶ Second

	Cessation Date   
	4.2, ¶ Fifth

	COBRA   
	4.2, ¶ Second

	Code Section 409A   
	4.8

	Committee   
	2.3

	Company   
	Preamble

	Company Plans   
	3.1

	Competing Entity   
	5.3

	Competition Notice   
	4.2, ¶ Third

	Competitive Activities   
	5.3

	Confidential Information   
	5.2

	Consideration Period   
	4.6, ¶ Second

	Control   
	1.4

	Corporate Event   
	4.1, ¶ Fourth

	Disabled and Disability   
	4.4, ¶ Second

	Effective Date   
	1.2

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	Term
	Section

	Executive   
	Preamble

	Extended Term   
	1.2

	First Taxable Year   
	6.14

	Health Plan   
	4.2, ¶ Second

	Initial Payment Period   
	6.14

	Initial Payments   
	6.14

	Initial Term   
	1.2

	Person   
	1.4

	Project   
	1.3

	Proprietary Rights   
	5.1, ¶ First

	Reimbursement Period   
	4.2, ¶ Second

	Release   
	4.6, ¶ First

	Release Consideration   
	4.6, ¶ Second

	Revocation Period   
	4.6, ¶ Second

	Second Taxable Year   
	6.14

	Separation from Service   
	4.8

	Severance Amount   
	4.4, ¶ First, (c)

	Severance Installments   
	4.2, ¶ First, (c)(i)

	Severance Lump-Sum Payment   
	4.2, ¶ First, (c)(ii)

	Severance Period   
	4.2, ¶ First, (c)(i)

	Straddle Rule   
	6.14

	Subsidiaries   
	Introduction

	Target Bonus   
	2.3

	Term   
	1.2

	Termination For Cause   
	4.1, ¶ First

	Termination Notice   
	4.2, ¶ First

	Termination With Good Reason   
	4.3, ¶ First

	Termination Without Cause   
	4.2, ¶ First

	Voluntary Termination   
	4.3, ¶ Fourth

[Signature page follows.]

    

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IN WITNESS WHEREOF, the parties hereto have executed this Employment Agreement to be effective as of the day and year first above written.

COMPANY:

STARZ

By:     /s/ J. Steven Beabout
Name: J. Steven Beabout
Title:   Executive Vice President and General Counsel
Date:   August 14, 2013

EXECUTIVE:

/s/ Christopher Albrecht                
Christopher Albrecht
Date:   August 14, 2013
 

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Exhibit A

Projects

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Exhibit B

Nonqualified Stock Option Agreement

22

Exhibit C

Form of Acknowledgment Under Section 2870 of the California Labor Code

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Omitted Exhibits 

The following exhibits to the Employment Agreement, made effective as of January 1, 2013, by and between Starz and Christopher Albrecht, have not been provided herein:

Exhibit A: Projects
Exhibit B: Nonqualified Stock Option Agreement
Exhibit C: Form of Acknowledgement Under Section 2870 of the California Labor Code
 
The undersigned registrant hereby undertakes to furnish supplementally a copy of any omitted exhibit to the Securities and Exchange Commission upon request.

    

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Active 14594896.1Starz_Exhibit 10.2_09.30.2013

EXHIBIT 10.2

STARZ 
2011 INCENTIVE PLAN
(Amended and Restated as of October 15, 2013)

ARTICLE I
PURPOSE OF PLAN; EFFECTIVE DATE
1.1    Purpose.  The purpose of the Plan is to promote the success of the Company by providing a method whereby (i) eligible employees of the Company and its Subsidiaries and (ii) independent contractors providing services to the Company and its Subsidiaries may be awarded additional remuneration for services rendered and may be encouraged to invest in capital stock of the Company, thereby increasing their proprietary interest in the Company’s businesses, encouraging them to remain in the employ or service of the Company or its Subsidiaries, and increasing their personal interest in the continued success and progress of the Company and its Subsidiaries.  The Plan is also intended to aid in (i) attracting Persons of exceptional ability to become officers and employees of the Company and its Subsidiaries and (ii) inducing independent contractors to agree to provide services to the Company and its Subsidiaries.
1.2    Amendment and Restatement of Plan.  The Plan is hereby amended and restated effective October 15, 2013 by the Compensation Committee of the Board of Directors of the Company, to make certain clarifying changes throughout the Plan and to incorporate all amendments made to the Plan since the Effective Date.

ARTICLE II
DEFINITIONS
2.1    Certain Defined Terms.  Capitalized terms not defined elsewhere in the Plan shall have the following meanings (whether used in the singular or plural):
“Account” has the meaning ascribed thereto in Section 8.2.
“Affiliate” of the Company means any corporation, partnership or other business association that, directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with the Company.
“Agreement” means a stock option agreement, stock appreciation rights agreement, restricted shares agreement, restricted stock units agreement, cash award agreement or an agreement evidencing more than one type of Award, specified in Section 10.5, as any such Agreement may be supplemented or amended from time to time.
“Approved Transaction” means any transaction in which the Board (or, if approval of the Board is not required as a matter of law, the stockholders of the Company) shall approve (i) any consolidation or merger of the Company, or binding share exchange, pursuant to which shares of Common Stock of the Company would be changed or converted into or exchanged for cash, securities, or other property, other than any such transaction in which the common stockholders of the Company immediately prior to such transaction have the same proportionate ownership of the Common Stock of, and voting power with respect to, the surviving corporation immediately after such transaction, (ii) any merger, consolidation or binding share exchange to which the Company is a party as a result of which the Persons who are common stockholders of the Company immediately prior thereto have less than a majority of the combined voting power of the outstanding capital stock of the Company ordinarily (and apart from the rights accruing under special circumstances) having the right to vote in the election of directors immediately following such merger, consolidation or binding share exchange, (iii) the adoption of any plan or proposal for the liquidation or dissolution of the Company, or (iv) any sale, lease, exchange 

1

EXHIBIT 10.2

or other transfer (in one transaction or a series of related transactions) of all, or substantially all, of the assets of the Company.
“Award” means a grant of Options, SARs, Restricted Shares, Restricted Stock Units, Performance Awards, Cash Awards and/or cash amounts under the Plan.
“Board” means the Board of Directors of the Company.
“Board Change” means, during any period of two consecutive years, individuals who at the beginning of such period constituted the entire Board cease for any reason to constitute a majority thereof unless the election, or the nomination for election, of each new director was approved by a vote of at least two-thirds of the directors then still in office who were directors at the beginning of the period.
“Cash Award” means an Award made pursuant to Section 9.1 of the Plan to a Holder that is paid solely on account of the attainment of one or more Performance Objectives that have been preestablished by the Committee.
“Code” means the Internal Revenue Code of 1986, as amended from time to time, or any successor statute or statutes thereto.  Reference to any specific Code section shall include any successor section.
“Committee” means the committee of the Board appointed pursuant to Section 3.1 to administer the Plan.
“Common Stock” means each or any (as the context may require) series of the Company’s common stock.
“Company” means Starz (f/k/a Liberty Media Corporation), a Delaware corporation.
“Control Purchase” means any transaction (or series of related transactions) in which any person (as such term is defined in Sections 13(d)(3) and 14(d)(2) of the Exchange Act), corporation or other entity (other than the Company, any Subsidiary of the Company or any employee benefit plan sponsored by the Company or any Subsidiary of the Company or any Exempt Person (as defined below)) shall become the “beneficial owner” (as such term is defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 20% or more of the combined voting power of the then outstanding securities of the Company ordinarily (and apart from the rights accruing under special circumstances) having the right to vote in the election of directors (calculated as provided in Rule 13d-3(d) under the Exchange Act in the case of rights to acquire the Company’s securities), other than in a transaction (or series of related transactions) approved by the Board.  For purposes of this definition, “Exempt Person” means each of (a) the Chairman of the Board, the President and each of the directors of the Company as of the Redemption Date, and (b) the respective family members, estates and heirs of each of the Persons referred to in clause (a) above and any trust or other investment vehicle for the primary benefit of any of such Persons or their respective family members or heirs.  As used with respect to any Person, the term “family member” means the spouse, siblings and lineal descendants of such Person.
“Disability” means the inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months.
“Dividend Equivalents” means, with respect to Restricted Stock Units, to the extent specified by the Committee only, an amount equal to all dividends and other distributions (or the economic equivalent thereof) which are payable to stockholders of record during the Restriction Period on a like number and kind of shares of Common Stock.  Notwithstanding any provision of the Plan to the contrary, Dividend Equivalents with respect to a Performance Award may only be paid to the extent the Performance Award is actually paid to the Holder.

2

“Domestic Relations Order” means a domestic relations order as defined by the Code or Title I of the Employee Retirement Income Security Act of 1974, or the rules thereunder.
“Effective Date” means the Redemption Date.
“Equity Security” shall have the meaning ascribed to such term in Section 3(a)(11) of the Exchange Act, and an equity security of an issuer shall have the meaning ascribed thereto in Rule 16a-1 promulgated under the Exchange Act, or any successor Rule.
“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, or any successor statute or statutes thereto.  Reference to any specific Exchange Act section shall include any successor section.
“Fair Market Value” of a share of any series of Common Stock on any day means (i) for Option and SAR exercise transactions effected on any third-party incentive award administration system provided by the Company, the current high bid price of a share of any series of Common Stock as reported on the consolidated transaction reporting system on the principal national securities exchange on which shares of such series of Common Stock are listed on such day or if such shares are not then listed on a national securities exchange, then as quoted by Pink OTC Markets Inc., or (ii) for all other purposes under this Plan, the last sale price (or, if no last sale price is reported, the average of the high bid and low asked prices) for a share of such series of Common Stock on such day (or, if such day is not a trading day, on the next preceding trading day) as reported on the consolidated transaction reporting system for the principal national securities exchange on which shares of such series of Common Stock are listed on such day or if such shares are not then listed on a national securities exchange, then as quoted by Pink OTC Markets Inc.  If for any day the Fair Market Value of a share of the applicable series of Common Stock is not determinable by any of the foregoing means, then the Fair Market Value for such day shall be determined in good faith by the Committee on the basis of such quotations and other considerations as the Committee deems appropriate.
“Free Standing SAR” has the meaning ascribed thereto in Section 7.1. 
“Holder” means a Person who has received an Award under the Plan. 
“Option” means a stock option granted under Article VI.
“Performance Award” means an Award made pursuant to Article IX of the Plan to a Holder that is subject to the attainment of one or more Performance Objectives.
“Performance Objective” means a standard established by the Committee to determine in whole or in part whether a Performance Award shall be earned.
“Person” means an individual, corporation, limited liability company, partnership, trust, incorporated or unincorporated association, joint venture or other entity of any kind.
“Plan” means this Starz 2011 Incentive Plan (amended and restated as of October 25, 2013).
“Redemption” means the redemption by Liberty Interactive Corporation (f/k/a Liberty Media Corporation) of all of the outstanding shares of each series of its former Liberty Capital Common Stock and Liberty Starz Common Stock for shares of the Company’s former Capital Common Stock and Starz Common Stock, respectively.
“Redemption Date” means 5:00 p.m., New York City time, on September 23, 2011 (the date on which the Redemption occurred).
“Restricted Shares” means shares of any series of Common Stock awarded pursuant to Section 8.1.

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“Restricted Stock Unit” means a unit evidencing the right to receive in specified circumstances one share of the specified series of Common Stock or the equivalent value in cash, which right is subject to a Restriction Period or forfeiture provisions.
“Restriction Period” means a period of time beginning on the date of each Award of Restricted Shares or Restricted Stock Units and ending on the Vesting Date with respect to such Award.
“Retained Distribution” has the meaning ascribed thereto in Section 8.3.
“SARs” means stock appreciation rights, awarded pursuant to Article VII, with respect to shares of any specified series of Common Stock.
“Subsidiary” of a Person means any present or future subsidiary (as defined in Section 424(f) of the Code) of such Person or any business entity in which such Person owns, directly or indirectly, 50% or more of the voting, capital or profits interests.  An entity shall be deemed a subsidiary of a Person for purposes of this definition only for such periods as the requisite ownership or control relationship is maintained.
“Tandem SARs” has the meaning ascribed thereto in Section 7.1.
“Vesting Date,” with respect to any Restricted Shares or Restricted Stock Units awarded hereunder, means the date on which such Restricted Shares or Restricted Stock Units cease to be subject to a risk of forfeiture, as designated in or determined in accordance with the Agreement with respect to such Award of Restricted Shares or Restricted Stock Units pursuant to Article VIII.  If more than one Vesting Date is designated for an Award of Restricted Shares or Restricted Stock Units, reference in the Plan to a Vesting Date in respect of such Award shall be deemed to refer to each part of such Award and the Vesting Date for such part.

ARTICLE III 
ADMINISTRATION
3.1    Committee.  The Plan shall be administered by the Compensation Committee of the Board unless a different committee is appointed by the Board.  The Committee shall be comprised of not less than two Persons.  The Board may from time to time appoint members of the Committee in substitution for or in addition to members previously appointed, may fill vacancies in the Committee and may remove members of the Committee.  The Committee shall select one of its members as its chairman and shall hold its meetings at such times and places as it shall deem advisable.  A majority of its members shall constitute a quorum and all determinations shall be made by a majority of such quorum.  Any determination reduced to writing and signed by all of the members shall be as fully effective as if it had been made by a majority vote at a meeting duly called and held.
3.2    Powers.  The Committee shall have full power and authority to grant to eligible Persons Options under Article VI of the Plan, SARs under Article VII of the Plan, Restricted Shares under Article VIII of the Plan, Restricted Stock Units under Article VIII of the Plan, Cash Awards under Article IX of the Plan and/or Performance Awards under Article IX of the Plan, to determine the terms and conditions (which need not be identical) of all Awards so granted, to interpret the provisions of the Plan and any Agreements relating to Awards granted under the Plan and to supervise the administration of the Plan.  The Committee in making an Award may provide for the granting or issuance of additional, replacement or alternative Awards upon the occurrence of specified events, including the exercise of the original Award.  The Committee shall have sole authority in the selection of Persons to whom Awards may be granted under the Plan and in the determination of the timing, pricing and amount of any such Award, subject only to the express provisions of the Plan.  In making determinations hereunder, the Committee may take into account the nature of the services rendered by the respective employees and independent 

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contractors, their present and potential contributions to the success of the Company and its Subsidiaries, and such other factors as the Committee in its discretion deems relevant.
3.3    Interpretation.  The Committee is authorized, subject to the provisions of the Plan, to establish, amend and rescind such rules and regulations as it deems necessary or advisable for the proper administration of the Plan and to take such other action in connection with or in relation to the Plan as it deems necessary or advisable.  Each action and determination made or taken pursuant to the Plan by the Committee, including any interpretation or construction of the Plan, shall be final and conclusive for all purposes and upon all Persons.  No member of the Committee shall be liable for any action or determination made or taken by such member or the Committee in good faith with respect to the Plan.

ARTICLE IV
SHARES SUBJECT TO THE PLAN
4.1    Number of Shares.  Subject to the provisions of this Article IV, the maximum number of shares of Common Stock with respect to which Awards may be granted during the term of the Plan shall be 23,834,000 shares.  Shares of Common Stock will be made available from the authorized but unissued shares of the Company or from shares reacquired by the Company, including shares purchased in the open market.  The shares of Common Stock subject to (i) any Award granted under the Plan that shall expire, terminate or be cancelled or annulled for any reason without having been exercised (or considered to have been exercised as provided in Section 7.2), (ii) any Award of any SARs granted under the Plan the terms of which provide for settlement in cash, and (iii) any Award of Restricted Shares or Restricted Stock Units that shall be forfeited prior to becoming vested (provided that the Holder received no benefits of ownership of such Restricted Shares or Restricted Stock Units other than voting rights and the accumulation of Retained Distributions and unpaid Dividend Equivalents that are likewise forfeited) shall again be available for purposes of the Plan.  Notwithstanding the foregoing, the following shares of Common Stock may not again be made available for issuance as Awards under the Plan: (a) shares of Common Stock not issued or delivered as a result of the net settlement of an outstanding Option or SAR, (b) shares of Common Stock used to pay the purchase price or withholding taxes related to an outstanding Award, or (c) shares of Common Stock repurchased on the open market with the proceeds of an Option purchase price.  Except for Awards described in Section 10.1, no Person may be granted in any calendar year Awards covering more than 7,627,000 shares of Common Stock (as such amount may be adjusted from time to time as provided in Section 4.2).  No Person shall receive payment for Cash Awards during any calendar year aggregating in excess of $10 million.
4.2    Adjustments.
(a)    If the Company subdivides its outstanding shares of any series of Common Stock into a greater number of shares of such series of Common Stock (by stock dividend, stock split, reclassification, or otherwise) or combines its outstanding shares of any series of Common Stock into a smaller number of shares of such series of Common Stock (by reverse stock split, reclassification, or otherwise) or if the Committee determines that any stock dividend, extraordinary cash dividend, reclassification, recapitalization, reorganization, stock redemption, split-up, spin-off, combination, exchange of shares, warrants or rights offering to purchase such series of Common Stock or other similar corporate event (including mergers or consolidations other than those which constitute Approved Transactions, adjustments with respect to which shall be governed by Section 10.1(b)) affects any series of Common Stock so that an adjustment is required to preserve the benefits or potential benefits intended to be made available under the Plan, then the Committee, in such manner as the Committee, in its sole discretion, deems equitable and appropriate, shall make such adjustments to any or all of (i) the number and kind of shares of stock which thereafter may be awarded, optioned or otherwise made subject to the benefits contemplated by the Plan, (ii) the number and kind of shares of stock subject to outstanding Awards, and (iii) the purchase or exercise price and the relevant appreciation base with respect to any of 

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the foregoing, provided, however, that the number of shares subject to any Award shall always be a whole number.  The Committee may, if deemed appropriate, provide for a cash payment to any Holder of an Award in connection with any adjustment made pursuant to this Section 4.2.
(b)    Notwithstanding any provision of the Plan to the contrary, in the event of a corporate merger, consolidation, acquisition of property or stock, separation, reorganization or liquidation, the Committee shall be authorized, in its discretion, (i) to provide, prior to the transaction, for the acceleration of the vesting and exercisability of, or lapse of restrictions with respect to, the Award and, if the transaction is a cash merger, provide for the termination of any portion of the Award that remains unexercised at the time of such transaction, or (ii) to cancel any such Awards and to deliver to the Holders cash in an amount that the Committee shall determine in its sole discretion is equal to the fair market value of such Awards on the date of such event, which in the case of Options or SARs shall be the excess of the Fair Market Value (as determined in sub-section (ii) of the definition of such term) of Common Stock on such date over the purchase price of the Options or the base price of the SARs, as applicable.
(c)    No adjustment or substitution pursuant to this Section 4.2 shall be made in a manner that results in noncompliance with the requirements of Section 409A of the Code, to the extent applicable.
ARTICLE V 
ELIGIBILITY
5.1    General.  The Persons who shall be eligible to participate in the Plan and to receive Awards under the Plan shall, subject to Section 5.2, be such Persons who are employees (including officers and directors) of or independent contractors providing services to the Company or its Subsidiaries as the Committee shall select.  Awards may be made to employees or independent contractors who hold or have held Awards under the Plan or any similar or other awards under any other plan of the Company or any of its Affiliates.
5.2    Ineligibility.  No member of the Committee, while serving as such, shall be eligible to receive an Award.

ARTICLE VI 
STOCK OPTIONS
6.1    Grant of Options.  Subject to the limitations of the Plan, the Committee shall designate from time to time those eligible Persons to be granted Options, the time when each Option shall be granted to such eligible Persons, the series and number of shares of Common Stock subject to such Option, and, subject to Section 6.2, the purchase price of the shares of Common Stock subject to such Option.
6.2    Option Price.  The price at which shares may be purchased upon exercise of an Option shall be fixed by the Committee and may be no less than the Fair Market Value of the shares of the applicable series of Common Stock subject to the Option as of the date the Option is granted.
6.3    Term of Options.  Subject to the provisions of the Plan with respect to death, retirement and termination of employment, the term of each Option shall be for such period as the Committee shall determine as set forth in the applicable Agreement; provided that such term may not exceed ten years.
6.4    Exercise of Options.  An Option granted under the Plan shall become (and remain) exercisable during the term of the Option to the extent provided in the applicable Agreement and the Plan and, unless the Agreement otherwise provides, may be exercised to the extent exercisable, in whole or in part, at any time and from time to time during such term; provided, however, that subsequent to the grant of an Option, the Committee, at any time before complete termination of such Option, may accelerate the 

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time or times at which such Option may be exercised in whole or in part (without reducing the term of such Option).
6.5    Manner of Exercise.
(a)    Form of Payment.  An Option shall be exercised by written notice to the Company upon such terms and conditions as the Agreement may provide and in accordance with such other procedures for the exercise of Options as the Committee may establish from time to time.  The method or methods of payment of the purchase price for the shares to be purchased upon exercise of an Option and of any amounts required by Section 10.9 shall be determined by the Committee and may consist of (i) cash, (ii) check, (iii) promissory note (subject to applicable law), (iv) whole shares of any series of Common Stock, (v) the withholding of shares of the applicable series of Common Stock issuable upon such exercise of the Option, (vi) the delivery, together with a properly executed exercise notice, of irrevocable instructions to a broker to deliver promptly to the Company the amount of sale or loan proceeds required to pay the purchase price, or (vii) any combination of the foregoing methods of payment, or such other consideration and method of payment as may be permitted for the issuance of shares under the Delaware General Corporation Law.  The permitted method or methods of payment of the amounts payable upon exercise of an Option, if other than in cash, shall be set forth in the applicable Agreement and may be subject to such conditions as the Committee deems appropriate.
(b)    Value of Shares.  Unless otherwise determined by the Committee and provided in the applicable Agreement, shares of any series of Common Stock delivered in payment of all or any part of the amounts payable in connection with the exercise of an Option, and shares of any series of Common Stock withheld for such payment, shall be valued for such purpose at their Fair Market Value as of the exercise date.
(c)    Issuance of Shares.  The Company shall effect the transfer of the shares of Common Stock purchased under the Option as soon as practicable after the exercise thereof and payment in full of the purchase price therefor and of any amounts required by Section 10.9, and within a reasonable time thereafter, such transfer shall be evidenced on the books of the Company.  Unless otherwise determined by the Committee and provided in the applicable Agreement, (i) no Holder or other Person exercising an Option shall have any of the rights of a stockholder of the Company with respect to shares of Common Stock subject to an Option granted under the Plan until due exercise and full payment has been made, and (ii) no adjustment shall be made for cash dividends or other rights for which the record date is prior to the date of such due exercise and full payment.

ARTICLE VII 
SARS
7.1    Grant of SARs.  Subject to the limitations of the Plan, SARs may be granted by the Committee to such eligible Persons in such numbers, with respect to any specified series of Common Stock, and at such times during the term of the Plan as the Committee shall determine. A SAR may be granted to a Holder of an Option (hereinafter called a “related Option”) with respect to all or a portion of the shares of Common Stock subject to the related Option (a “Tandem SAR”) or may be granted separately to an eligible employee (a “Free Standing SAR”). Subject to the limitations of the Plan, SARs shall be exercisable in whole or in part upon notice to the Company upon such terms and conditions as are provided in the Agreement.
7.2    Tandem SARs.  A Tandem SAR may be granted either concurrently with the grant of the related Option or at any time thereafter prior to the complete exercise, termination, expiration or cancellation of such related Option.  Tandem SARs shall be exercisable only at the time and to the extent that the related Option is exercisable (and may be subject to such additional limitations on exercisability as the Agreement may provide) and in no event after the complete termination or full exercise of the 

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related Option.  Upon the exercise or termination of the related Option, the Tandem SARs with respect thereto shall be canceled automatically to the extent of the number of shares of Common Stock with respect to which the related Option was so exercised or terminated. Subject to the limitations of the Plan, upon the exercise of a Tandem SAR and unless otherwise determined by the Committee and provided in the applicable Agreement, (i) the Holder thereof shall be entitled to receive from the Company, for each share of the applicable series of Common Stock with respect to which the Tandem SAR is being exercised, consideration (in the form determined as provided in Section 7.4) equal in value to the excess of the Fair Market Value of a share of the applicable series of Common Stock with respect to which the Tandem SAR was granted on the date of exercise over the related Option purchase price per share, and (ii) the related Option with respect thereto shall be canceled automatically to the extent of the number of shares of Common Stock with respect to which the Tandem SAR was so exercised.
7.3    Free Standing SARs.  Free Standing SARs shall be exercisable at the time, to the extent and upon the terms and conditions set forth in the applicable Agreement.  The base price of a Free Standing SAR may be no less than the Fair Market Value of the applicable series of Common Stock with respect to which the Free Standing SAR was granted as of the date the Free Standing SAR is granted.  Subject to the limitations of the Plan, upon the exercise of a Free Standing SAR and unless otherwise determined by the Committee and provided in the applicable Agreement, the Holder thereof shall be entitled to receive from the Company, for each share of the applicable series of Common Stock with respect to which the Free Standing SAR is being exercised, consideration (in the form determined as provided in Section 7.4) equal in value to the excess of the Fair Market Value of a share of the applicable series of Common Stock with respect to which the Free Standing SAR was granted on the date of exercise over the base price per share of such Free Standing SAR.  The term of a Free Standing SAR may not exceed ten years.
7.4    Consideration.  The consideration to be received upon the exercise of a SAR by the Holder shall be paid in cash, shares of the applicable series of Common Stock with respect to which the SAR was granted (valued at Fair Market Value on the date of exercise of such SAR), a combination of cash and such shares of the applicable series of Common Stock or such other consideration, in each case, as provided in the Agreement.  No fractional shares of Common Stock shall be issuable upon exercise of a SAR, and unless otherwise provided in the applicable Agreement, the Holder will receive cash in lieu of fractional shares.  Unless the Committee shall otherwise determine, to the extent a Free Standing SAR is exercisable, it will be exercised automatically for cash on its expiration date.
7.5    Limitations.  The applicable Agreement may provide for a limit on the amount payable to a Holder upon exercise of SARs at any time or in the aggregate, for a limit on the number of SARs that may be exercised by the Holder in whole or in part for cash during any specified period, for a limit on the time periods during which a Holder may exercise SARs, and for such other limits on the rights of the Holder and such other terms and conditions of the SAR, including a condition that the SAR may be exercised only in accordance with rules and regulations adopted from time to time, as the Committee may determine.  Unless otherwise so provided in the applicable Agreement, any such limit relating to a Tandem SAR shall not restrict the exercisability of the related Option.  Such rules and regulations may govern the right to exercise SARs granted prior to the adoption or amendment of such rules and regulations as well as SARs granted thereafter.
7.6    Exercise.  For purposes of this Article VII, the date of exercise of a SAR shall mean the date on which the Company shall have received notice from the Holder of the SAR of the exercise of such SAR (unless otherwise determined by the Committee and provided in the applicable Agreement).

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ARTICLE VIII
RESTRICTED SHARES AND RESTRICTED STOCK UNITS
8.1    Grant of Restricted Shares.  Subject to the limitations of the Plan, the Committee shall designate those eligible Persons to be granted Awards of Restricted Shares, shall determine the time when each such Award shall be granted, and shall designate (or set forth the basis for determining) the Vesting Date or Vesting Dates for each Award of Restricted Shares, and may prescribe other restrictions, terms and conditions applicable to the vesting of such Restricted Shares in addition to those provided in the Plan.  The Committee shall determine the price, if any, to be paid by the Holder for the Restricted Shares; provided, however, that the issuance of Restricted Shares shall be made for at least the minimum consideration necessary to permit such Restricted Shares to be deemed fully paid and nonassessable.  All determinations made by the Committee pursuant to this Section 8.1 shall be specified in the Agreement.
8.2    Issuance of Restricted Shares.  An Award of Restricted Shares shall be registered in a book entry account (the “Account”) in the name of the Holder to whom such Restricted Shares shall have been awarded.  During the Restriction Period, the Account, any certificates representing the Restricted Shares that may be issued during the Restriction Period and any securities constituting Retained Distributions shall bear a restrictive legend to the effect that ownership of the Restricted Shares (and such Retained Distributions), and the enjoyment of all rights appurtenant thereto, are subject to the restrictions, terms and conditions provided in the Plan and the applicable Agreement. Any such certificates shall remain in the custody of the Company or its designee, and the Holder shall deposit with the custodian stock powers or other instruments of assignment, each endorsed in blank, so as to permit retransfer to the Company of all or any portion of the Restricted Shares and any securities constituting Retained Distributions that shall be forfeited or otherwise not become vested in accordance with the Plan and the applicable Agreement.
8.3    Restrictions with Respect to Restricted Shares.  During the Restriction Period, Restricted Shares shall constitute issued and outstanding shares of the applicable series of Common Stock for all corporate purposes.  The Holder will have the right to vote such Restricted Shares, to receive and retain such dividends and distributions, as the Committee may designate, paid or distributed on such Restricted Shares, and to exercise all other rights, powers and privileges of a Holder of shares of the applicable series of Common Stock with respect to such Restricted Shares; except, that, unless otherwise determined by the Committee and provided in the applicable Agreement, (i) the Holder will not be entitled to delivery of the stock certificate or certificates representing such Restricted Shares until the Restriction Period shall have expired and unless all other vesting requirements with respect thereto shall have been fulfilled or waived; (ii) the Company or its designee will retain custody of the stock certificate or certificates representing the Restricted Shares during the Restriction Period as provided in Section 8.2; (iii) other than such dividends and distributions as the Committee may designate, the Company or its designee will retain custody of all distributions (“Retained Distributions”) made or declared with respect to the Restricted Shares (and such Retained Distributions will be subject to the same restrictions, terms and vesting, and other conditions as are applicable to the Restricted Shares) until such time, if ever, as the Restricted Shares with respect to which such Retained Distributions shall have been made, paid or declared shall have become vested, and such Retained Distributions shall not bear interest or be segregated in a separate account; (iv) the Holder may not sell, assign, transfer, pledge, exchange, encumber or dispose of the Restricted Shares or any Retained Distributions or such Holder’s interest in any of them during the Restriction Period; and (v) a breach of any restrictions, terms or conditions provided in the Plan or established by the Committee with respect to any Restricted Shares or Retained Distributions will cause a forfeiture of such Restricted Shares and any Retained Distributions with respect thereto.
8.4    Grant of Restricted Stock Units.  Subject to the limitations of the Plan, the Committee shall designate those eligible Persons to be granted Awards of Restricted Stock Units, the value of which is based, in whole or in part, on the Fair Market Value of the shares of any specified series of Common 

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Stock.  Subject to the provisions of the Plan, including any rules established pursuant to Section 8.5, Awards of Restricted Stock Units shall be subject to such terms, restrictions, conditions, vesting requirements and payment rules as the Committee may determine in its discretion, which need not be identical for each Award.  Such Awards may provide for the payment of cash consideration by the Person to whom such Award is granted or provide that the Award, and any shares of Common Stock to be issued in connection therewith, if applicable, shall be delivered without the payment of cash consideration; provided, however, that the issuance of any shares of Common Stock in connection with an Award of Restricted Stock Units shall be for at least the minimum consideration necessary to permit such shares to be deemed fully paid and nonassessable.  The determinations made by the Committee pursuant to this Section 8.4 shall be specified in the applicable Agreement.
8.5    Restrictions with Respect to Restricted Stock Units.  Any Award of Restricted Stock Units, including any shares of Common Stock which are part of an Award of Restricted Stock Units, may not be assigned, sold, transferred, pledged or otherwise encumbered prior to the date on which the shares are issued or, if later, the date provided by the Committee at the time of the Award.  A breach of any restrictions, terms or conditions provided in the Plan or established by the Committee with respect to any Award of Restricted Stock Units will cause a forfeiture of such Restricted Stock Units and any Dividend Equivalents with respect thereto.
8.6    Issuance of Restricted Stock Units.  Restricted Stock Units shall be issued at the beginning of the Restriction Period, shall not constitute issued and outstanding shares of the applicable series of Common Stock, and the Holder shall not have any of the rights of a stockholder with respect to the shares of Common Stock covered by such an Award of Restricted Stock Units, in each case until such shares shall have been issued to the Holder at the end of the Restriction Period.  If and to the extent that shares of Common Stock are to be issued at the end of the Restriction Period, the Holder shall be entitled to receive Dividend Equivalents with respect to the shares of Common Stock covered thereby either (i) during the Restriction Period or (ii) in accordance with the rules applicable to Retained Distributions, as the Committee may specify in the Agreement.
8.7    Cash Payments.  In connection with any Award of Restricted Shares or Restricted Stock Units, an Agreement may provide for the payment of a cash amount to the Holder of such Awards at any time after such Awards shall have become vested.  Such cash amounts shall be payable in accordance with such additional restrictions, terms and conditions as shall be prescribed by the Committee in the Agreement and shall be in addition to any other salary, incentive, bonus or other compensation payments which such Holder shall be otherwise entitled or eligible to receive from the Company.
8.8    Completion of Restriction Period.  On the Vesting Date with respect to each Award of Restricted Shares or Restricted Stock Units and the satisfaction of any other applicable restrictions, terms and conditions, (i) all or the applicable portion of such Restricted Shares or Restricted Stock Units shall become vested, (ii) any Retained Distributions with respect to such Restricted Shares and any unpaid Dividend Equivalents with respect to such Restricted Stock Units shall become vested to the extent that the Award related thereto shall have become vested, and (iii) any cash amount to be received by the Holder with respect to such Restricted Shares or Restricted Stock Units shall become payable, all in accordance with the terms of the applicable Agreement.  Any such Restricted Shares, Restricted Stock Units, Retained Distributions and any unpaid Dividend Equivalents that shall not become vested shall be forfeited to the Company, and the Holder shall not thereafter have any rights (including dividend and voting rights) with respect to such Restricted Shares, Restricted Stock Units, Retained Distributions and any unpaid Dividend Equivalents that shall have been so forfeited.  The Committee may, in its discretion, provide that the delivery of any Restricted Shares, Restricted Stock Units, Retained Distributions and unpaid Dividend Equivalents that shall have become vested, and payment of any related cash amounts that shall have become payable under this Article VIII, shall be deferred until such date or dates as the recipient may elect.  Any election of a recipient pursuant to the preceding sentence shall be filed in 

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writing with the Committee in accordance with such rules and regulations, including any deadline for the making of such an election, as the Committee may provide, and shall be made in compliance with Section 409A of the Code.

ARTICLE IX
CASH AWARDS AND PERFORMANCE AWARDS
9.1    Cash Awards.  In addition to granting Options, SARs, Restricted Shares and Restricted Stock Units, the Committee shall, subject to the limitations of the Plan, have authority to grant to eligible Persons Cash Awards.  Each Cash Award shall be subject to such terms and conditions, restrictions and contingencies, if any, as the Committee shall determine.  Restrictions and contingencies limiting the right to receive a cash payment pursuant to a Cash Award shall be based upon the achievement of single or multiple Performance Objectives over a performance period established by the Committee.  The determinations made by the Committee pursuant to this Section 9.1 shall be specified in the applicable Agreement.
9.2    Designation as a Performance Award.  The Committee shall have the right to designate any Award of Options, SARs, Restricted Shares or Restricted Stock Units as a Performance Award.  All Cash Awards shall be designated as Performance Awards.
9.3    Performance Objectives.  The grant or vesting of a Performance Award shall be subject to the achievement of Performance Objectives over a performance period established by the Committee based upon one or more of the following business criteria that apply to the Holder, one or more business units, divisions or Subsidiaries of the Company or the applicable sector of the Company, the Company as a whole, or any entity or entities to which the Company or Subsidiaries of the Company are providing services, and if so desired by the Committee, by comparison with a peer group of companies: increased revenue; net income measures (including income after capital costs and income before or after taxes); stock price measures (including growth measures and total stockholder return); price per share of Common Stock; market share; earnings per share (actual or targeted growth); earnings before interest, taxes, depreciation and amortization (EBITDA); operating income before depreciation and amortization (OIBDA); economic value added (or an equivalent metric); market value added; debt to equity ratio; cash flow measures (including cash flow return on capital, cash flow return on tangible capital, net cash flow and net cash flow before financing activities); return measures (including return on equity, return on average assets, return on capital, risk-adjusted return on capital, return on investors’ capital and return on average equity); operating measures (including operating income, funds from operations, cash from operations, after-tax operating income, sales volumes, production volumes and production efficiency); expense measures (including overhead cost and general and administrative expense); margins; stockholder value; total stockholder return; proceeds from dispositions; total market value and corporate values measures (including ethics compliance, environmental and safety).  Unless otherwise stated, such a Performance Objective need not be based upon an increase or positive result under a particular business criterion and could include, for example, maintaining the status quo or limiting economic losses (measured, in each case, by reference to specific business criteria).  The Committee shall have the authority to determine whether the Performance Objectives and other terms and conditions of the Award are satisfied, and the Committee’s determination as to the achievement of Performance Objectives relating to a Performance Award shall be made in writing.
9.4    Section 162(m) of the Code.  Notwithstanding the foregoing provisions, if the Committee intends for a Performance Award to be granted and administered in a manner designed to preserve the deductibility of the compensation resulting from such Award in accordance with Section 162(m) of the Code, then the Performance Objectives for such particular Performance Award relative to the particular period of service to which the Performance Objectives relate shall be established by the Committee in 

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writing (i) no later than 90 days after the beginning of such period and (ii) prior to the completion of 25% of such period.
9.5    Waiver of Performance Objectives.  The Committee shall have no discretion to modify or waive the Performance Objectives or conditions to the grant or vesting of a Performance Award unless such Award is not intended to qualify as qualified performance-based compensation under Section 162(m) of the Code and the relevant Agreement provides for such discretion.

ARTICLE X 
GENERAL PROVISIONS
10.1    Acceleration of Awards.
(a)    Death or Disability.  If a Holder’s employment shall terminate by reason of death or Disability, notwithstanding any contrary waiting period, installment period, vesting schedule or Restriction Period in any Agreement or in the Plan, unless the applicable Agreement provides otherwise:  (i) in the case of an Option or SAR, each outstanding Option or SAR granted under the Plan shall immediately become exercisable in full in respect of the aggregate number of shares covered thereby; (ii) in the case of Restricted Shares, the Restriction Period applicable to each such Award of Restricted Shares shall be deemed to have expired and all such Restricted Shares and any related Retained Distributions shall become vested and any related cash amounts payable pursuant to the applicable Agreement shall be adjusted in such manner as may be provided in the Agreement; and (iii) in the case of Restricted Stock Units, the Restriction Period applicable to each such Award of Restricted Stock Units shall be deemed to have expired and all such Restricted Stock Units and any unpaid Dividend Equivalents shall become vested and any related cash amounts payable pursuant to the applicable Agreement shall be adjusted in such manner as may be provided in the Agreement.
(b)    Approved Transactions; Board Change; Control Purchase.  In the event of any Approved Transaction, Board Change or Control Purchase, notwithstanding any contrary waiting period, installment period, vesting schedule or Restriction Period in any Agreement or in the Plan, unless the applicable Agreement provides otherwise: (i) in the case of an Option or SAR, each such outstanding Option or SAR granted under the Plan shall become exercisable in full in respect of the aggregate number of shares covered thereby; (ii) in the case of Restricted Shares, the Restriction Period applicable to each such Award of Restricted Shares shall be deemed to have expired and all such Restricted Shares and any related Retained Distributions shall become vested and any related cash amounts payable pursuant to the applicable Agreement shall be adjusted in such manner as may be provided in the Agreement; and (iii) in the case of Restricted Stock Units, the Restriction Period applicable to each such Award of Restricted Stock Units shall be deemed to have expired and all such Restricted Stock Units and any unpaid Dividend Equivalents shall become vested and any related cash amounts payable pursuant to the applicable Agreement shall be adjusted in such manner as may be provided in the Agreement, in each case effective upon the Board Change or Control Purchase or immediately prior to consummation of the Approved Transaction.  The effect, if any, on a Cash Award of an Approved Transaction, Board Change or Control Purchase shall be prescribed in the applicable Agreement.  Notwithstanding the foregoing, unless otherwise provided in the applicable Agreement, the Committee may, in its discretion, determine that any or all outstanding Awards of any or all types granted pursuant to the Plan will not vest or become exercisable on an accelerated basis in connection with an Approved Transaction if effective provision has been made for the taking of such action which, in the opinion of the Committee, is equitable and appropriate to substitute a new Award for such Award or to assume such Award and to make such new or assumed Award, as nearly as may be practicable, equivalent to the old Award (before giving effect to any acceleration of the vesting or exercisability thereof), taking into account, to the extent applicable, the kind and amount of securities, cash or other assets into or for which the applicable series of Common Stock may be changed, converted or exchanged in connection with the Approved Transaction.

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10.2    Termination of Employment.
(a)    General.  If a Holder’s employment shall terminate prior to an Option or SAR becoming exercisable or being exercised (or deemed exercised, as provided in Section 7.2) in full, or during the Restriction Period with respect to any Restricted Shares or any Restricted Stock Units, then such Option or SAR shall thereafter become or be exercisable, and the Holder’s rights to any unvested Restricted Shares, Retained Distributions and related cash amounts and any unvested Restricted Stock Units, unpaid Dividend Equivalents and related cash amounts shall thereafter vest, in each case solely to the extent provided in the applicable Agreement; provided, however, that, unless otherwise determined by the Committee and provided in the applicable Agreement, (i) no Option or SAR may be exercised after the scheduled expiration date thereof; (ii) if the Holder’s employment terminates by reason of death or Disability, the Option or SAR shall remain exercisable for a period of at least one year following such termination (but not later than the scheduled expiration of such Option or SAR); and (iii) any termination of the Holder’s employment for cause will be treated in accordance with the provisions of Section 10.2(b).  The effect on a Cash Award of the termination of a Holder’s employment for any reason, other than for cause, shall be prescribed in the applicable Agreement.
(b)    Termination for Cause.  If a Holder’s employment with the Company or a Subsidiary of the Company shall be terminated by the Company or such Subsidiary for “cause” during the Restriction Period with respect to any Restricted Shares or Restricted Stock Units or prior to any Option or SAR becoming exercisable or being exercised in full or prior to the payment in full of any Cash Award (for these purposes, “cause” shall have the meaning ascribed thereto in any employment agreement to which such Holder is a party or, in the absence thereof, shall include insubordination, dishonesty, incompetence, moral turpitude, other misconduct of any kind and the refusal to perform such Holder’s duties and responsibilities for any reason other than illness or incapacity; provided, however, that if such termination occurs within 12 months after an Approved Transaction or Control Purchase or Board Change, termination for “cause” shall mean only a felony conviction for fraud, misappropriation, or embezzlement), then, unless otherwise determined by the Committee and provided in the applicable Agreement, (i) all Options and SARs and all unpaid Cash Awards held by such Holder shall immediately terminate, and (ii) such Holder’s rights to all Restricted Shares, Restricted Stock Units, Retained Distributions, any unpaid Dividend Equivalents and any related cash amounts shall be forfeited immediately.
(c)    Miscellaneous.  The Committee may determine whether any given leave of absence constitutes a termination of employment; provided, however, that for purposes of the Plan, (i) a leave of absence, duly authorized in writing by the Company for military service or sickness, or for any other purpose approved by the Company if the period of such leave does not exceed 90 days, and (ii) a leave of absence in excess of 90 days, duly authorized in writing by the Company provided the employee’s right to reemployment is guaranteed either by statute or contract, shall not be deemed a termination of employment.  Unless otherwise determined by the Committee and provided in the applicable Agreement, Awards made under the Plan shall not be affected by any change of employment so long as the Holder continues to be an employee of the Company.
10.3    Right of Company to Terminate Employment.  Nothing contained in the Plan or in any Award, and no action of the Company or the Committee with respect thereto, shall confer or be construed to confer on any Holder any right to continue in the employ of the Company or any of its Subsidiaries or interfere in any way with the right of the Company or any Subsidiary of the Company to terminate the employment of the Holder at any time, with or without cause, subject, however, to the provisions of any employment agreement between the Holder and the Company or any Subsidiary of the Company.
10.4    Nonalienation of Benefits.  Except as set forth herein, no right or benefit under the Plan shall be subject to anticipation, alienation, sale, assignment, hypothecation, pledge, exchange, transfer, garnishment, encumbrance or charge, and any attempt to anticipate, alienate, sell, assign, hypothecate, 

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pledge, exchange, transfer, garnish, encumber or charge the same shall be void.  No right or benefit hereunder shall in any manner be liable for or subject to the debts, contracts, liabilities or torts of the Person entitled to such benefits.
10.5    Written Agreement.  Each Award under the Plan shall be evidenced by a written agreement, in such form as the Committee shall approve from time to time in its discretion, specifying the terms and provisions of such Award which may not be inconsistent with the provisions of the Plan; provided, however, that if more than one type of Award is made to the same Holder, such Awards may be evidenced by a single Agreement with such Holder.  Each grantee of an Option, SAR, Restricted Shares, Restricted Stock Units or Performance Award (including a Cash Award) shall be notified promptly of such grant, and a written Agreement shall be promptly delivered by the Company.  Any such written Agreement may contain (but shall not be required to contain) such provisions as the Committee deems appropriate (i) to insure that the penalty provisions of Section 4999 of the Code will not apply to any stock or cash received by the Holder from the Company or (ii) to provide cash payments to the Holder to mitigate the impact of such penalty provisions upon the Holder.  Any such Agreement may be supplemented or amended from time to time as approved by the Committee as contemplated by Section 10.7(b).
10.6    Nontransferability.  Unless otherwise determined by the Committee and expressly provided for in an Agreement, Awards are not transferable (either voluntarily or involuntarily), before or after a Holder’s death, except as follows: (a) during the Holder’s lifetime, pursuant to a Domestic Relations Order, issued by a court of competent jurisdiction, that is not contrary to the terms and conditions of the Plan or any applicable Agreement, and in a form acceptable to the Committee; or (b) after the Holder’s death, by will or pursuant to the applicable laws of descent and distribution, as may be the case.  Any person to whom Awards are transferred in accordance with the provisions of the preceding sentence shall take such Awards subject to all of the terms and conditions of the Plan and any applicable Agreement.
10.7    Termination and Amendment.
(a)    General.  Unless the Plan shall theretofore have been terminated as hereinafter provided, no Awards may be made under the Plan on or after the fifth anniversary of the Effective Date.  The Plan may be terminated at any time prior to such date and may, from time to time, be suspended or discontinued or modified or amended if such action is deemed advisable by the Committee.
(b)    Modification.  No termination, modification or amendment of the Plan may, without the consent of the Person to whom any Award shall theretofore have been granted, adversely affect the rights of such Person with respect to such Award.  No modification, extension, renewal or other change in any Award granted under the Plan shall be made after the grant of such Award, unless the same is consistent with the provisions of the Plan.  With the consent of the Holder and subject to the terms and conditions of the Plan (including Section 10.7(a)), the Committee may amend outstanding Agreements with any Holder, including any amendment which would (i) accelerate the time or times at which the Award may be exercised and/or (ii) extend the scheduled expiration date of the Award.  Without limiting the generality of the foregoing, the Committee may, but solely with the Holder’s consent unless otherwise provided in the Agreement, agree to cancel any Award under the Plan and grant a new Award in substitution therefor, provided that the Award so substituted shall satisfy all of the requirements of the Plan as of the date such new Award is made.  Nothing contained in the foregoing provisions of this Section 10.7(b) shall be construed to prevent the Committee from providing in any Agreement that the rights of the Holder with respect to the Award evidenced thereby shall be subject to such rules and regulations as the Committee may, subject to the express provisions of the Plan, adopt from time to time or impair the enforceability of any such provision.

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10.8    Government and Other Regulations.  The obligation of the Company with respect to Awards shall be subject to all applicable laws, rules and regulations and such approvals by any governmental agencies as may be required, including the effectiveness of any registration statement required under the Securities Act of 1933, and the rules and regulations of any securities exchange or association on which the Common Stock may be listed or quoted.  For so long as any series of Common Stock are registered under the Exchange Act, the Company shall use its reasonable efforts to comply with any legal requirements (i) to maintain a registration statement in effect under the Securities Act of 1933 with respect to all shares of the applicable series of Common Stock that may be issuable, from time to time, to Holders under the Plan and (ii) to file in a timely manner all reports required to be filed by it under the Exchange Act.
10.9    Withholding.  The Company’s obligation to deliver shares of Common Stock or pay cash in respect of any Award under the Plan shall be subject to applicable federal, state and local tax withholding requirements.  Federal, state and local withholding tax due at the time of an Award, upon the exercise of any Option or SAR or upon the vesting of, or expiration of restrictions with respect to, Restricted Shares or Restricted Stock Units or the satisfaction of the Performance Objectives applicable to a Performance Award, as appropriate, may, in the discretion of the Committee, be paid in shares of Common Stock already owned by the Holder or through the withholding of shares otherwise issuable to such Holder, upon such terms and conditions (including the conditions referenced in Section 6.5) as the Committee shall determine. If the Holder shall fail to pay, or make arrangements satisfactory to the Committee for the payment to the Company of, all such federal, state and local taxes required to be withheld by the Company, then the Company shall, to the extent permitted by law, have the right to deduct from any payment of any kind otherwise due to such Holder an amount equal to any federal, state or local taxes of any kind required to be withheld by the Company with respect to such Award.
10.10    Nonexclusivity of the Plan.  The adoption of the Plan by the Board shall not be construed as creating any limitations on the power of the Board to adopt such other incentive arrangements as it may deem desirable, including the granting of stock options and the awarding of stock and cash otherwise than under the Plan, and such arrangements may be either generally applicable or applicable only in specific cases.
10.11    Exclusion from Pension and Profit-Sharing Computation.  By acceptance of an Award, unless otherwise provided in the applicable Agreement, each Holder shall be deemed to have agreed that such Award is special incentive compensation that will not be taken into account, in any manner, as salary, compensation or bonus in determining the amount of any payment under any pension, retirement or other employee benefit plan, program or policy of the Company or any Subsidiary of the Company.  In addition, each beneficiary of a deceased Holder shall be deemed to have agreed that such Award will not affect the amount of any life insurance coverage, if any, provided by the Company on the life of the Holder which is payable to such beneficiary under any life insurance plan covering employees of the Company or any Subsidiary of the Company.
10.12    Unfunded Plan.  Neither the Company nor any Subsidiary of the Company shall be required to segregate any cash or any shares of Common Stock which may at any time be represented by Awards, and the Plan shall constitute an “unfunded” plan of the Company. Except as provided in Article VIII with respect to Awards of Restricted Shares and except as expressly set forth in an Agreement, no employee shall have voting or other rights with respect to the shares of Common Stock covered by an Award prior to the delivery of such shares. Neither the Company nor any Subsidiary of the Company shall, by any provisions of the Plan, be deemed to be a trustee of any shares of Common Stock or any other property, and the liabilities of the Company and any Subsidiary of the Company to any employee pursuant to the Plan shall be those of a debtor pursuant to such contract obligations as are created by or pursuant to the Plan, and the rights of any employee, former employee or beneficiary under the Plan shall be limited to those of a general creditor of the Company or the applicable Subsidiary of the Company, as 

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the case may be.  In its sole discretion, the Board may authorize the creation of trusts or other arrangements to meet the obligations of the Company under the Plan, provided, however, that the existence of such trusts or other arrangements is consistent with the unfunded status of the Plan.
10.13    Governing Law.  The Plan shall be governed by, and construed in accordance with, the laws of the State of Delaware.
10.14    Accounts.  The delivery of any shares of Common Stock and the payment of any amount in respect of an Award shall be for the account of the Company or the applicable Subsidiary of the Company, as the case may be, and any such delivery or payment shall not be made until the recipient shall have paid or made satisfactory arrangements for the payment of any applicable withholding taxes as provided in Section 10.9.
10.15    Legends.  Any certificate evidencing shares of Common Stock subject to an Award shall bear such legends as the Committee deems necessary or appropriate to reflect or refer to any terms, conditions or restrictions of the Award applicable to such shares, including any to the effect that the shares represented thereby may not be disposed of unless the Company has received an opinion of counsel, acceptable to the Company, that such disposition will not violate any federal or state securities laws.
10.16    Company’s Rights.  The grant of Awards pursuant to the Plan shall not affect in any way the right or power of the Company to make reclassifications, reorganizations or other changes of or to its capital or business structure or to merge, consolidate, liquidate, sell or otherwise dispose of all or any part of its business or assets.
10.17    Section 409A.  It is the intent of the Company that Awards under this Plan comply with the requirements of, or be exempt from the application of, Section 409A of the Code and related regulations and United States Department of the Treasury pronouncements (“Section 409A”), and the provisions of this Plan will be administered, interpreted and construed accordingly.  Notwithstanding anything in this Plan to the contrary, if any Plan provision or Award under the Plan would result in the imposition of an additional tax under Section 409A, that Plan provision or Award will be construed or reformed to avoid imposition of the applicable tax and no action taken to comply with Section 409A shall be deemed to adversely affect the Holder’s rights to an Award.

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