Document:

Exhibit 10.65

Exhibit 10.65

CONFIDENTIAL TREATMENT REQUESTED: Certain portions of this document have been omitted
pursuant to a request for confidential treatment and, where applicable, have been marked
with an asterisk (“[*****]”) to denote where omissions have been made. The confidential
material has been filed separately with the Securities and Exchange Commission.

RAILCAR SERVICES AGREEMENT

Date: April 15, 2011

Between

AMERICAN RAILCAR INDUSTRIES, INC.

And

AMERICAN RAILCAR LEASING, LLC

 

 

 

CONFIDENTIAL TREATMENT REQUESTED: Certain portions of this document have been omitted
pursuant to a request for confidential treatment and, where applicable, have been marked
with an asterisk (“[*****]”) to denote where omissions have been made. The confidential
material has been filed separately with the Securities and Exchange Commission.

This agreement (“Agreement”) is to confirm and document our mutual understanding with respect to
the terms and conditions under which American Railcar Industries, Inc. (hereinafter “ARI”) of 100
Clark Street, St. Charles, MO 63301, a North Dakota corporation, agrees to provide AMERICAN RAILCAR
LEASING LLC (hereinafter “ARL “) of 100 Clark Street, Suite 201, St. Charles, MO 63301 a Delaware
corporation, with certain services as hereinafter specified.

	 	1.	 	SERVICES

	 	a.	 	For the purposes hereof, the term “Services” shall include, without limitation,
the following activities and services to be provided to ARL by ARI:

Repair Services as described by Exhibit A, “American Railcar Leasing, LLC Fleet
Services”, which is attached hereto and incorporated herein. The rates and fees for the
Services shall be as specified in Exhibit A. These rates and fees will be effective for
all estimates submitted, or services provided, after April 16, 2011 and are firm for the
first one year term of this agreement. After the initial one year term, the labor rate
may be increased annually, not to exceed [*****] in any one year. Any changes resulting
from such negotiation will take effect on the date mutually agreed-to by the parties.

	 	b.	 	Fees for Tax, Engineering and Administrative Services are described by Exhibit
B, which is attached hereto and incorporated herein.

	 	2.	 	PAYMENT

An invoice shall be submitted at the beginning of each month. Such invoice shall identify
the Services, and items, if any, that require payment for disbursements made by ARI on
behalf of ARL. Such items shall include, but not be limited to railcar cleaning,
maintenance, repairs, modifications, paint and lining, any ad hoc services specifically
requested by ARL, and payment of ad valorem taxes. The invoice provided shall accurately
reflect the appropriate charges and/or credits due ARL on a monthly basis.

All invoices are due and payable by ARL to ARI via wire transfer within 5 business days
after the end of a month for which the invoices are due. Any disbursements made by ARI on
behalf of ARL will be paid on ARL’s behalf in a timely manner and ARL will reimburse ARI
upon notification for any such disbursements.

	 	3.	 	TERM

	 	a.	 	The term of this Agreement shall commence upon April 16, 2011 and shall
continue for a period of three (3) years. Thereafter, this Agreement shall remain in
effect from year to year unless a party, at least sixty (60) days prior to the end of
the 3-year period or any subsequent annual period, notifies the other party in writing
that this Agreement shall terminate at the end of the then current period.

	 	b.	 	Notwithstanding any termination of this Agreement, ARI agrees to provide ARL,
during the period prior to termination and/or for up to three months thereafter, at
ARL’s option, such assistance as ARL may request to return to ARL, or to transfer to
another provider, all of
ARL’s data, inventory, and ARI’s related responsibilities for the Services provided
under this Agreement. Compensation to the canceled party for such transfer assistance
services shall be no greater than the compensation for Services provided in Exhibit D
attached hereto and incorporated herein.

 

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CONFIDENTIAL TREATMENT REQUESTED: Certain portions of this document have been omitted
pursuant to a request for confidential treatment and, where applicable, have been marked
with an asterisk (“[*****]”) to denote where omissions have been made. The confidential
material has been filed separately with the Securities and Exchange Commission.

	 	4.	 	INSURANCE

	 	a.	 	ARI shall obtain, and shall at all times during the Term maintain in full
force and effect, with financially sound and reputable insurers selected in
accordance with sound commercial and industry practices such property, casualty,
public liability and other insurance on its property, assets, and business in such
amounts and against such risks as is consistent and in accordance with sound
commercial and industry practice for activities similar to ARI’s obligations
hereunder.

	 	b.	 	Without limitation on the foregoing clause (a), ARI shall obtain, and
shall at all times during the Term maintain in full force and effect, with respect
to the Cars, policies of such insurance and against such risks as are maintained by
ARI from time to time with respect to other railcars for which it performs
maintenance and servicing, including casualty, public liability and pollution
coverage for all losses related to cargo, including clean-up costs and legal defense
costs, subject, in each case, to compliance with certain insurance-related
provisions in the User Leases and other provisions of this Section 4.1. Such
insurance shall be in addition to any insurance provided by a User pursuant to the
terms of any lease to which such Car is then subject. All insurance obtained by ARI
with respect to the Cars may (and shall to the extent reasonably practicable unless
ARL objects) be maintained under policies of insurance that ARI obtains for itself
and other railcars so long as ARL and any other Person designated by ARL are
additional insured’s there under and loss payees, as their interests may appear,
with respect to the Cars, and such insurance may be placed through insurers who are
Affiliates of ARI so long as the prices and terms thereof are comparable to those
that could be obtained from comparable unaffiliated insurers. Copies of policies
and certificates of insurance with respect thereto shall be furnished promptly to
ARL. If at any time the insurance maintained by ARI on the Cars shall lapse or have
limits lower than as described therein for whatever reason, ARI, promptly upon
receipt of notice of the lapse of or decrease in such insurance coverage, shall give
notice to ARL of the same. ARI shall also notify ARL promptly with respect to any
default in the payment of any premium or of any other act or omission of ARI or of
any other Person of which ARI has knowledge that might invalidate, render
unenforceable, result in a lapse of or reduce any insurance coverage on the Cars
maintained by ARI pursuant to this Agreement. ARI shall collect any amounts due
from the insurers under such policies and shall provide ARL with such reasonable
assistance as ARL may request in any dealings that ARL may have with such insurers,
including the pursuit of any claims under such policies. To the extent that ARI
elects to self-insure against certain risks with respect to the Cars, then upon the
occurrence of an applicable insurable event with respect to a Car, ARI shall remit
to ARL the amount of such self-insured risk.

 

2

 

CONFIDENTIAL TREATMENT REQUESTED: Certain portions of this document have been omitted
pursuant to a request for confidential treatment and, where applicable, have been marked
with an asterisk (“[*****]”) to denote where omissions have been made. The confidential
material has been filed separately with the Securities and Exchange Commission.

	 	c.	 	Each insurance policy maintained by ARI pursuant to the provisions of
Section 4.1(b) shall (i) expressly provide that no cancellation or termination
thereof material change therein shall be effective unless at least thirty (30) days’
prior written notice shall have
been given to ARL, (ii) expressly provide that if such insurance shall be cancelled
for any reason whatsoever, or if any substantial changes are made in the coverage
that affect the interest of ARL or any other Person listed as an additional insured
or loss payee, or if such insurance shall be allowed to lapse for nonpayment of
premium, such cancellation, change or lapse shall not be effective as to ARL and any
such other Person for thirty (30) days after receipt by ARL of written notice from
such insurers of such cancellation, change or lapse, (iii) permit ARL or any such
other Person to make payments to affect the continuation of such insurance coverage
upon notice of cancellation due to nonpayment of premium, and (iv) expressly provide
that if such insurance shall not be renewed for any reason whatsoever, such insurers
shall provide written notice of such non-renewal to ARL at least thirty (30) days
prior to the expiration date of the policy.

	 	d.	 	ARI shall deliver or cause to be delivered to ARL (i) no later than the
date hereof, certificates evidencing the insurance required pursuant to this section
4.1 and evidence satisfactory to ARL that the Cars have been properly included in a
schedule to the insurance policies required pursuant to Section 4.1(b), and (ii)
promptly after each renewal thereof, additional certificates evidencing the renewal
of such insurance.

	 	e.	 	In the event that any insurance coverage required by Section 4.1(b) or
the limits deductible amounts, or requirements thereof are not reasonably available
and commercially feasible in the available insurance market, ARL shall not
unreasonably withhold its agreement to waive the requirement of such coverage,
limits, deductible amounts, or requirements to the extent the maintenance thereof is
not so available; provided, however, that (i) ARI shall have made a request for such
waiver and shall have provided ARL with written reports prepared by an independent
insurance advisor certifying that such coverage, limits, deductible amounts, or
requirements are not reasonably available and commercially feasible in the available
insurance market for railcars similar to the Cars and, where the required amount of
coverage is not so available, certifying as maximum amount that is so available and
(ii) any waiver granted pursuant to this clause shall be effective only during the
period that the coverage, limits, deductible amounts, or requirements thereby waived
are not reasonably available and commercially feasible in the available insurance
market.

	 	5.	 	INDEMNIFICATION

ARL shall defend, indemnify and hold ARI harmless from and against any and all claims,
actions, damages, expenses, losses or liabilities incurred by or asserted against ARI to the
extent caused by ARL’s negligence or breach of this Agreement. ARI shall defend, indemnify
and hold ARL harmless from and against any and all claims, actions, damages, expenses,
losses or liabilities incurred or asserted against ARL to the extent caused by ARI’s
negligence or breach of this Agreement. Neither ARI nor ARL (nor its representatives) shall
have liability to the other under this Agreement for any punitive, incidental or
consequential damages, such as excess costs incurred, data loss or lost profits or revenue.

 

3

 

CONFIDENTIAL TREATMENT REQUESTED: Certain portions of this document have been omitted
pursuant to a request for confidential treatment and, where applicable, have been marked
with an asterisk (“[*****]”) to denote where omissions have been made. The confidential
material has been filed separately with the Securities and Exchange Commission.

	 	6.	 	REMEDIES.

It is mutually agreed that the time of performance of the Services hereunder and payment of
charges is of the essence of this Agreement. If either party shall default in the
performance or
observance of any of the other agreements herein contained to be performed or observed and
such default shall continue for ten (10) days after written notice from the non-defaulting
party, or if there shall be filed by or against either party a petition in bankruptcy or for
reorganization under the Bankruptcy Law or there shall be a receiver appointed for any part
of such party’s property or such party shall make a general assignment for the benefit of
creditors, then and in any of said events, the other party at its election, may immediately
terminate this Agreement.

	 	7.	 	CONFIDENTIALITY

ARI, its employees and agents shall treat and maintain as confidential all of
ARL’s confidential and proprietary information, and agrees not to use or disclose any
such information to others except as is necessary to perform Services hereunder. This
information will include but not be limited to any technical information, experience
or data regarding ARL’s products, plans, programs, plants, processes, costs,
equipment, operations, or customers which may be disclosed to or come within the
knowledge of ARI, its employees and agents in the performance of this Agreement.
However, no confidential relationship will arise or exist as to any such disclosed
subject matter which is in the public domain other than as a result of a breach of
this agreement or other wrongful acts by ARI, its employees, or agents.

ARL, its employees and agents shall treat and maintain as confidential all of ARI’s
confidential and proprietary information, and agrees not to use or disclose any such
information to others except as is necessary to utilize and benefit from the Services
hereunder. This information will include but not be limited to any technical
information, experience or data regarding ARI’s products, plans, programs, plants,
processes, costs, equipment, operations, or customers which may be disclosed to or come
within the knowledge of ARL, its employees and agents in the performance of this
Agreement. However, no confidential relationship will arise or exist as to any such
disclosed subject matter which is in the public domain other than as a result of a
breach of this agreement or other wrongful acts by ARL, its employees, or agents.

	 	8.	 	NOTICES

Any notices, requests, demands, and determinations under this Agreement (other than routine
operational communications), shall be in writing and shall be deemed duly given (i) when
delivered by hand, (ii) one (1) business day after being given to a nationally recognized
express courier with a reliable system for tracking delivery, or (iii) when sent confirmed
facsimile or e-mail with a copy sent by registered or certified mail, return receipt
requested, postage prepaid, and addressed as follows:

	 	 	 	 	 
	 

	 	If to ARL:
	 	American Railcar Leasing LLC
	 

	 	 	 	100 Clark St., Suite 201
	 

	 	 	 	St. Charles, MO 63301
	 

	 	 	 	Attn: Dave Maechling, Director — Leasing Services
	 
	 	 	 	 
	 

	 	If to ARI
	 	American Railcar Industries, Inc.
	 

	 	 	 	100 Clark Street
	 

	 	 	 	St. Charles, MO 63301
	 

	 	 	 	Attn: John Smith — Sr. Director Fleet Services

 

4

 

CONFIDENTIAL TREATMENT REQUESTED: Certain portions of this document have been omitted
pursuant to a request for confidential treatment and, where applicable, have been marked
with an asterisk (“[*****]”) to denote where omissions have been made. The confidential
material has been filed separately with the Securities and Exchange Commission.

Either party, by written notice to the other party, may change the person and/or address to
which notice shall be given. Both parties agree to acknowledge in writing the receipt of
any notice delivered in person.

	 	9.	 	WAIVER

The failure of a party hereunder to assert the right to enforce an obligation of the other
party shall not be deemed a waiver of such right or obligation and in no event shall any
waiver by ARL or ARI of any default under this Agreement operate as a waiver of any further
default, whether of a like or different character or a continuing waiver of subsequent
defaults.

	 	10.	 	MISCELLANEOUS

	 	a.	 	This Agreement shall be governed by the laws of the State of New York. By
signing this Agreement, the parties agree to submit to the jurisdiction of the courts
of the State of New York. The confidentiality and indemnification obligations of the
parties under this Agreement shall survive the termination or expiration of this
Agreement.

	 	b.	 	If any clause or provision of this Agreement shall be adjudged invalid or
unenforceable by a court of competent jurisdiction or by operation of any applicable
law, it shall not affect the validity or enforceability of any other clause or
provision, which shall remain in full force and effect.

	 	c.	 	Neither party will assign, transfer, encumber, or otherwise dispose of this
Agreement without the written consent of the other party, where such consent shall not
be unreasonably withheld. Any transfer cost will be borne by the party making the
transfer.

	 	d.	 	In no event shall either party be liable for any consequential, incidental,
special, or punitive damages, including but not limited to any damages for lost
profits, or business opportunities, or damage to reputation.

	 	e.	 	This Agreement, along with its Exhibits and Riders, constitutes the entire
Agreement with respect to ARI, ARL and the Services, and supersedes all prior
negotiations, dealings, and agreements, whether verbal or written. This Agreement may
not be modified unless done in writing and signed by authorized representatives of ARI
and ARL.

	 	f.	 	The headings of this Agreement are for reference only and are not to be
construed as part of this Agreement.

	 	11.	 	[*****]

	 	12.	 	DEFINITIONS

“AAR” means the Association of American Railroads and any successor thereto.

“ARI” shall have the meaning set forth in the preamble hereof.

 

5

 

CONFIDENTIAL TREATMENT REQUESTED: Certain portions of this document have been omitted
pursuant to a request for confidential treatment and, where applicable, have been marked
with an asterisk (“[*****]”) to denote where omissions have been made. The confidential
material has been filed separately with the Securities and Exchange Commission.

“ARL” shall have the meaning set forth in the preamble hereof.

“Cars” means at any time the hopper, tank and other railcars owned or managed by ARL or any of
its Affiliates.

“Owner” means any Person that owns Cars.

“Person” means any individual, corporation, partnership, limited liability company, joint
venture, association, joint stock company, trust, unincorporated organization or other entity, or
Governmental Authority.

“Regulatory Authorities” means the ICC, the DOT, the DOL, the AAR or any other governmental
authority or industry agency or authority that has proper jurisdiction to regulate the ownership,
leasing, operation, maintenance or use of the Cars.

“ICC” means the United States Interstate Commerce Commission.

“DOL” means the United States Department of Labor.

“DOT” means the United States Department of Transportation.

“User Lease” means any car service contract or other lease of one or more Cars or any separate
schedule or rider to a master car service contract or other lease and which schedule or rider
incorporates by reference all of the terms and conditions of such master contract or lease other
than those in other schedules or riders thereto or as specifically identified in such schedule or
rider.

“User” means any shipper, railroad or other Person not an Affiliate of ARL or any Owner who uses
cars pursuant to a User Lease.

IN WITNESS WHEREOF, the parties have executed this Agreement:

	 	 	 	 	 	 	 
	American Railcar Industries, Inc.	 	American railcar leasing, llc
	 
	 	 	 	 	 	 
	By:

	 	/s/ James Cowan
	 	By:
	 	/s/ Harry L. McKinstry
	 

	 	 
	 	 	 	 
	 

	 	Name: James Cowan
	 	 	 	Name: Harry L. McKinstry
	 

	 	Title: President / CEO
	 	 	 	Title: Vice President — Finance & Controller
	 
	 	 	 	 	 	 
	Date: April 15, 2011	 	Date: April 15, 2011

 

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CONFIDENTIAL TREATMENT REQUESTED: Certain portions of this document have been omitted
pursuant to a request for confidential treatment and, where applicable, have been marked
with an asterisk (“[*****]”) to denote where omissions have been made. The confidential
material has been filed separately with the Securities and Exchange Commission.

EXHIBIT A

AMERICAN RAILCAR LEASING, LLC 

REPAIR SERVICES

1. REPAIR SERVICES

	 	a.	 	ARI shall use reasonable commercial efforts to cause the Cars to be
repaired in good operating order and condition. The standard for Repair services
shall be the highest of (i) standard industry practice, (ii) any standard required
or set forth for the Cars or railcars of a similar class by law or any Regulatory
Authority, and (iii) with respect to the Cars or railcars of a similar class by law
or any Regulatory Authority, and (iv) with respect to the Cars leased to each User,
any standard set by such User, whether by terms of a User Lease or by other
understanding or agreement between a User and ARL or an Owner; provided, however,
that such standard shall never be lower than the standard for Repair services
provided to any other customer of ARI to which ARI provides general maintenance
services for a fleet of owned or leased railcars; and provided, further, that
subject to Section 1(e), (1) expenditures for Repair services in excess of those
expenditures shall not be made without the prior written consent of ARL unless such
Repair services are required pursuant to applicable law or the rules and regulations
of any Regulatory Authority and (2) unless required pursuant to applicable law or
the rules and regulations of any Regulatory Authority or consented to in writing by
ARL, no action shall be taken hereunder by ARI, regardless of cost, that reduces the
value or utility of any Car. Repair services shall include, without limitation, all
repairs, servicing, painting, alterations, modifications, improvements or additions
to the Cars in order to meet any of the foregoing standards. (Repair services also
shall include sales of railcar materials and parts requested by railroads, mobile
units, mini-shops or ARL). Simultaneously with the execution and delivery of this
Agreement, ARL shall provide ARI with guidelines with respect to certain Cars, which
guidelines may be amended by ARL from time to time. In the event that Repair
services are to be provided in respect of any Car covered by such guidelines, ARI
shall notify ARL prior to the performance of such Repair services.

	 	b.	 	Repair services may be performed by ARI or third Persons as may be
designated by ARL from time-to-time. All other services to be provided by ARI
under this Agreement shall be performed by ARI unless otherwise consented to in
writing by ARL.

	 	c.	 	If material supplied by ARI or work performed by it is found to be
defective, ARL shall notify ARI and ARL shall have the right to require the prompt
correction thereof by ARI and ARI’s expense and risk or, at ARL’s option, ARL may
correct the work or have the same corrected, charging ARI for the cost of making
such correction. Such correction shall not affect ARI’s warranty pursuant to
Section 1(d). If correction of such work is impractical, in the opinion of ARL, ARI
shall bear all risk after notice of rejection and ARI will, if requested in writing
to do so by ARL, at ARI’s expense, promptly such work or parts, ARL may by contract
or otherwise replace such work or such parts and charge ARI the excess cost
occasioned to ARL thereby. In lieu of the foregoing, ARL may
reject and/or return any defective work or materials and ARI shall refund to ARL any
payment made therefore.

 

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CONFIDENTIAL TREATMENT REQUESTED: Certain portions of this document have been omitted
pursuant to a request for confidential treatment and, where applicable, have been marked
with an asterisk (“[*****]”) to denote where omissions have been made. The confidential
material has been filed separately with the Securities and Exchange Commission.

	 	d.	 	ARI warrants to ARL that (i) all labor furnished to ARL hereunder shall
be performed in a workmanlike manner, (ii) all parts furnished to ARL hereunder that
are designed by ARI shall be free from all defects in design and materials, and
(iii) all parts furnished by ARL hereunder that are designed by ARL and manufactured
by ARI shall be free from all defects in materials. ARI agrees that this warranty
shall survive acceptance of and payment for such Repair services. In the event that
ARL requests that ARI obtain any parts from a third party, ARI shall assign to ARL
any warranties obtained from such third party in respect of such parts or, if such
third party warranties are not assignable, shall cooperate with ARL so as to afford
ARL the benefit of such third party warranties.

	 	e.	 	Compliance with Law. ARI shall comply in all respects with all
applicable laws, rules and regulations of all Governmental Authorities in the
operations of it business and in carrying out its obligations hereunder. ARI, at
ARL’s expense, shall use reasonable commercial efforts to cause the Cars to comply,
and ARL agrees that each User Lease entered into or renewed after the date hereof
shall require the User there under to comply, in all respects with all applicable
laws, rules and regulations of the Regulatory Authorities. In the event that such
laws, rules or regulations require any alteration of a Car, or in the event that any
equipment or appliance of a Car shall be required to be changed or replaced, or in
the event that any additional or other equipment or appliance is required to be
installed on a Car in order to comply with such laws, rules or regulations, ARI
shall notify ARL that such Alteration is required and, ARL so instructs, at ARL’s
expense, shall make such alteration, change, replacement or addition. In addition,
promptly after ARI has notice that any laws, rules or regulations will or may
require an Alteration, ARI shall notify ARL whether ARI believes, in the exercise of
its good faith business judgment, that such law, rule or regulation should be
contested.

	1.1	 	REPAIR SERVICE PAYMENTS. For Repair Services provided under this agreement by ARI, ARL will
pay for:

	 	i)	 	Materials and parts utilized in the performance of
these services. A) [*****] such materials or parts including inbound
freight, plus [*****] or B) if ARI manufactures such material or parts,
actual cost will be [*****], including inbound freight, plus [*****],
plus ii) labor costs at the, effective labor rate as adjusted by the
parties pursuant to the terms of section 1(a). iii) AAR repair work to
ARL’s cars will be billed at [*****].

	 	ii)	 	Labor Rate effective April 16, 2011 is: [*****]
per hour, and [*****].

 

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CONFIDENTIAL TREATMENT REQUESTED: Certain portions of this document have been omitted
pursuant to a request for confidential treatment and, where applicable, have been marked
with an asterisk (“[*****]”) to denote where omissions have been made. The confidential
material has been filed separately with the Securities and Exchange Commission.

EXHIBIT B

AMERICAN RAILCAR LEASING LLC

FEES FOR TAX, ENGINEERING AND ADMINISTRATIVE SERVICES

Ad Valorem Tax Services, as described in Exhibit C, are provided at an annual cost of [*****].

Separation of cost responsibility on all ARL’s BRC’s at the shop level [*****].

Electronic status reports of ARL cars in ARI shops on a daily basis [*****].

Continue current month end cost summary, and cycle time reports.

All other Engineering and Administrative Services provided to ARL by ARI will be quoted on a
case-by-case basis as requested by ARL.

 

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CONFIDENTIAL TREATMENT REQUESTED: Certain portions of this document have been omitted
pursuant to a request for confidential treatment and, where applicable, have been marked
with an asterisk (“[*****]”) to denote where omissions have been made. The confidential
material has been filed separately with the Securities and Exchange Commission.

EXHIBIT C

AD VALOREM TAXES

Service to be provided for a fleet of approximately [*****] cars for a minimum period of 12 months.
Fee is to be on a flat monthly amount, to include all normal operating expenses. The only
additions would be for travel expense, and outsourced services, such as legal fees. These
additional services require prior approval of ARL. If car numbers fluctuate significantly during
the contract period, the annual fee, as established in Exhibit B for Tax Services, will be reviewed
by the parties, and adjusted.

Services

	 	•	 	Attend the regular meetings of the RSI, at your expense.

	 	•	 	Participate in various legal and legislative matters in conjunction with the RSI and
make recommendations to ARL that would be worthwhile to ARL to support financially. Any
travel required as the result of the participation of ARL in specific efforts would be
billed in addition to the monthly rent, after approval by ARL.

	 	•	 	Present obsolescence information, compile and present movement studies, protest and
correct assessor errors in order to assure that all tax amounts are fair and as small as
legally possible. Contest such assessments with the appropriate taxing jurisdictions and
appeal boards as necessary.

	 	•	 	Prepare and file all tax returns, in accordance with due dates, or revised due dates.

	 	•	 	Sign such tax returns, (with authorization given by ARL).

	 	•	 	Provide electronic copies of all tax returns to ARL.

	 	•	 	Review notice of assessed value in various states, request work papers if necessary and
check values for accuracy and reasonableness. Correct errors if found, and discuss
corrected values with assessors. If the assessed values are excessive, evaluate whether to
negotiate and/or protest. Contest such assessments with the appropriate taxing
jurisdictions and appeal boards as necessary.

	 	•	 	All tax bills should be mailed directly to the Tax Service Supplier. All payments are
to be processed and issued by the Tax Service Supplier in a timely manner. ARL will fund
the Tax Service Supplier prior to the Tax Service Supplier paying the tax bills. The Tax
Service Supplier will provide information in detail showing the payments made.

 

10

 

CONFIDENTIAL TREATMENT REQUESTED: Certain portions of this document have been omitted
pursuant to a request for confidential treatment and, where applicable, have been marked
with an asterisk (“[*****]”) to denote where omissions have been made. The confidential
material has been filed separately with the Securities and Exchange Commission.

The Tax Service Supplier will provide ARL, on an annual basis, with electronic copies of all
tax bills and cancelled checks.

Litigation

The Tax Service Supplier will represent ARL in any litigation of tax matters. Any such litigation
of tax

 matters be it for ARL or part of a class action, must be agreed to by ARL in advance.

 

11

 

CONFIDENTIAL TREATMENT REQUESTED: Certain portions of this document have been omitted
pursuant to a request for confidential treatment and, where applicable, have been marked
with an asterisk (“[*****]”) to denote where omissions have been made. The confidential
material has been filed separately with the Securities and Exchange Commission.

EXHIBIT D

 AMERICAN RAILCAR LEASING, LLC

As specified in Section 3 (b), TERM, the compensation due ARI for Services relating to the
termination of this Agreement shall be as follows:

	 	a.	 	[*****] per hour, based on an eight (8) hour day.

	 	b.	 	All hours over eight (8) per day payable at the rate of [*****] per hour.

	 	c.	 	If travel is involved, ARL shall pay all reasonable travel, food, and lodging expenses.

	 	d.	 	For days involving travel only, a maximum of four (4) hours at the [*****] per
hour rate is chargeable, plus reasonable travel expenses.

	 	e.	 	Copies, facsimiles, magnetic media, and other office supplies will be charged
at ARI’s prevailing rate at the time of Services, which shall be consistent with
reasonable commercial rates.

 

12exv10w1

EXHIBIT 10.1

Baxter International Inc.

Equity Plan

Adopted as of March 4, 2011

1. Purpose

This Equity Plan (the “Plan”) has been adopted by the Compensation Committee (the
“Committee”) of the Board of Directors (the “Board”) of Baxter International Inc.
(“Baxter”).

2. Participants

Participants in this Plan (each a “Participant”) shall be select employees of Baxter or its
subsidiaries (the “Company”) to whom the Committee may make awards of Stock Options (each
an “Option”), Performance Share Units (each a “PSU”) and Restricted Stock Units (each a
“RSU”, and together with Options and PSUs, “Awards”) under this Plan.

3. Awards

Awards shall be made pursuant to and for the purposes stated in the Company incentive compensation
program or plan (the “Program”) identified in the individual grant materials provided to
the Participant (the “Grant”). Such Grant materials consist of a communication letter to
Participants notifying them of their Awards and may include alternative terms with respect to
vesting, in which case the vesting terms in the Grant communication letter shall govern. All
Awards granted hereunder shall be subject to the Company’s Incentive Compensation Recoupment Policy
or Executive Compensation Recoupment Policy, as applicable. Each Award shall be granted as of the
date approved and as provided in the Grant, or for eligible French employees as soon thereafter as
practicable pursuant to applicable French law (as provided in the attached French Addendum which
shall govern such Awards) (the “Grant Date”). Each Award shall be granted as of the date
approved and as provided in the Grant (the “Grant Date”). The purchase price for each
share of Common Stock subject to an Option shall be the Fair Market Value of a share of Common
Stock on the Grant Date. The terms of each Award will be as set forth in this Plan. Unless
otherwise indicated, terms defined in the Program shall have the same meaning in these terms and
conditions. Options are not intended to qualify as Incentive Stock Options within the meaning of
section 422 of the United States Internal Revenue Code, as amended (the “Code”).

4. Options

4.1. Except for Options granted to employees of the Company’s subsidiaries in France, Options shall
become exercisable as follows: (i) one-third on the first anniversary of the Grant Date, (ii)
one-third on the second anniversary of the Grant Date, and (iii) the remainder on the third
anniversary of the Grant Date. Options granted to employees of the Company’s subsidiaries in
France shall become exercisable on the fourth anniversary of the Grant Date. If Options would
become exercisable on a date that is not a business day, they will become exercisable on the next
business day. A business day is any day on which the Company’s Common Stock is traded on the New
York Stock Exchange. After Options become exercisable (in each case, in whole or in part) and until
they expire, the Options may be exercised in whole

 

 

or in part, in the manner specified by the
Committee. Under no circumstances may Options be exercised after they have expired. Shares of
Common Stock may be used to pay the purchase price for shares of Common Stock to be acquired upon
exercise of Options or fulfill any tax withholding obligation, subject to any requirements or
restrictions specified by the Committee.

4.2. If a Participant’s employment with the Company terminates before the Participant’s Options
becomes exercisable, the Options will expire when the Participant’s employment with the Company
terminates, except (i) in connection with a Qualifying Retirement or death or disability (each as
outlined below) or (ii) if the Participant is rehired by the Company within ninety days of
termination, in which case the Participant shall be construed to have been continuously employed by
the Company for purposes of vesting and exercise.

4.3. If a Participant’s employment with the Company terminates after the Participant’s Options
become exercisable, the Options will not expire immediately but will remain exercisable. Subject
to Section 4.6, and except in the event of a Qualifying Retirement (as provided in Section 4.4),
the Options will expire ninety days after the Participant’s employment with the Company terminates.
If the Participant dies or becomes disabled during the ninety-day period, the Options will expire
on the first anniversary of the termination date.

4.4. If the employment of a Participant who is at least 65 years of age, or at least 55 years of
age with at least 10 years of employment with the Company, is terminated other than for Cause or by
reason of the Participant’s death or disability (a “Qualifying Retirement”) then (i) if the
date of such termination is after the calendar year of the Grant Date, the Options shall continue
to vest as provided in Section 4.1, or (ii) if the date of such termination is in the calendar year
of the Grant Date, a portion of the Options shall continue to vest as provided in Section 4.1,
which portion shall be determined as follows: (# shares covered by Option award) * (# of months
worked in that year, rounded to nearest whole month) / 12. Subject to Section 4.6, the
Participant’s Options (whether vesting pursuant to (i) or (ii) or previously vested) shall expire
on the fifth anniversary of the termination date.

4.5. If the employment of a Participant is terminated due to death or disability, then (i) if the
date of such termination is after the calendar year of the Grant Date, the Options shall vest
immediately, or (ii) if the date of such termination is in the calendar year of the Grant Date, a
portion of the Options shall vest immediately, which portion shall be determined as follows: (#
shares covered by Option award) * (# of months worked in that year, rounded to nearest whole month)
/ 12. Subject to Section 4.6, such Options will expire on the first anniversary of the termination
date.

4.6. Options that have not previously expired will expire at the close of business on the tenth
anniversary of the Grant Date; provided, however, that Options granted to employees residing in
Switzerland on the Grant Date shall expire on the eleventh anniversary of the Grant Date. If
Options would expire on a date that is not a business day, they will expire at the close of
business on the last business day preceding that date. A business day is any day on which the
Common Stock is traded on the New York Stock Exchange.

 

 

4.7. Except as the Committee may otherwise provide, Options may only be exercised by the
Participant, the Participant’s legal representative, or a person to whom the Participant’s rights
in the Options are transferred by will or the laws of descent and distribution.

4.8. A transfer of employment within the Company will not constitute a termination of employment
within the meaning of the Plan.

4.9. A transfer of employment to a company that assumes an Option or issues a substitute option in
a transaction to which Section 424 of the Code applies will not constitute a termination of
employment within the meaning of the Plan.

4.10. Except to the extent that it would cause the Option to be subject to Section 409(A) of the
Code, the Committee may, in its sole discretion and without receiving permission from any
Participant, substitute stock appreciation rights (“SARs”) for any or all outstanding
Options. Upon the grant of substitute SARs, the related Options replaced by the substitute SARs
shall be cancelled. The grant price of the substitute SARs shall be equal to the Option Price of
the related Options, the term of the substitute SARs shall not exceed the term of the related
Options, and the terms and conditions applicable to the substitute SARs shall otherwise be
substantially the same as those applicable to the related Options replaced by the substitute SARs.
Upon exercise, the SARs will be settled in Common Stock.

5. Performance Share Units

5.1. The PSUs will be earned based on the rank of Baxter’s growth in shareholder value
(“GSV”) relative to the GSV of companies in the healthcare peer group selected by the
Committee. GSV will be measured over a three-year period beginning with the first day of the
calendar year of the Grant Date and ending on the last day of the third calendar year (the
“Performance Period”).

The PSUs will pay out in shares of Common Stock in a range of 0% to 200% of the number of PSUs
awarded to the Participant as follows:

	 	 	 	 	 
	Baxter Rank	 	Percentage of Target Grant Earned
	85th percentile of peer group or above
	 	 	200	%
	75th percentile
	 	 	150	%
	60th percentile
	 	 	100	%
	25th percentile
	 	 	25	%
	Below 25th percentile
	 	 	0	%

The PSUs will pay out linearly between each set of data points. GSV will be measured based on
the average closing stock prices over the last twenty days of the Performance Period (plus
reinvested dividends) divided by average closing stock prices over the twenty trading days prior to
the beginning of the Performance Period.

Following the end of the Performance Period, the Committee shall determine the payout, which
determination shall be final and binding. Shares of Common Stock earned will be delivered or
otherwise made available to the Participant as soon as practical after the Committee makes its
determination but not later than the March 15 after the end of the Performance Period. PSUs will

 

 

only be settled in shares of Common Stock. Any other settlement modality shall be considered an
exception, which would have to be approved separately by the Committee.

5.2. If a Participant’s employment with the Company terminates before the end of the Performance
Period, any unvested PSUs shall be forfeited on the effective date of termination, except (i) in
connection with a Qualifying Retirement or death or disability (each as outlined below), or (ii) if
the Participant is rehired by the Company within ninety days of termination, in which case the
Participant shall be construed to have been continuously employed by the Company for purposes of
vesting.

5.3. If the employment of a Participant terminates in a Qualifying Retirement then (i) if the date
of such termination is after the calendar year of the Grant Date, the PSUs will remain eligible for
payout at the end of the Performance Period on the terms provided in Section 5.1, or (ii) if the
date of such termination is in the calendar year of the Grant Date a portion of the PSUs shall
remain eligible for payout at the end of the Performance Period on the terms provided in Section
5.1, which portion shall be determined as follows: (# PSUs awarded) * (# of months worked in that
year, rounded to nearest whole month) / 12.

5.4. If the employment with the Company of a Participant is terminated due to death or disability,
the PSUs shall vest as follows: (i) if the date of such termination is after the calendar year of
the Grant Date, the PSUs shall pay out within sixty days at 100% of the Target Grant (as depicted
in the table in Section 5.1.), or (ii) if the date of such termination is in the calendar year of
the Grant Date a portion of the PSUs shall pay out as provided in (i), which portion shall be
determined as follows: (# PSUs awarded) * (# of months worked in that year, rounded to nearest
whole month) / 12.

5.5. The PSUs shall not be transferable and may not be sold, assigned, pledged, hypothecated or
otherwise encumbered.

5.6. A transfer of employment within the Company will not constitute a termination of employment
within the meaning of the Plan.

5.7. Until the shares of Common Stock have been delivered or otherwise made available as provided
in Section 5.1, the Participant shall not be treated as a shareholder as to those shares of Common
Stock relating to the PSUs. Notwithstanding the foregoing, the Participant shall be permitted to
receive additional PSUs with respect to the PSUs based upon the dividends and distributions paid on
shares of Common Stock to the same extent as if each PSU were a share of Common Stock (without
adjustment prior to vesting for payment levels set forth in the table in Section 5.1), which
additional PSUs shall be determined in amount and value in the Company’s discretion and shall be
delivered or made available at the same time and to the same extent as the PSUs to which they
relate or as otherwise determined by the Company.

6. Restricted Stock Units

6.1. Except for RSUs granted to the employees of the Company’s subsidiaries in France, RSUs are
subject to being earned and vested as follows: (i) one-third on the first anniversary of the Grant
Date, (ii) one-third on the second anniversary of the Grant Date, and (iii) the remainder on the
third anniversary of the Grant Date (as applicable, the “Vesting Date”). RSUs granted to

 

 

the employees of the Company’s subsidiaries in France are subject to being earned and vested on the
second anniversary of the Grant Date in accordance with the attached French Addendum. If RSUs
would become earned and vested on a date that is not a business day, the next business day shall be
the Vesting Date. The Company will deliver or otherwise make available to the Participant within
21/2 months following the applicable Vesting Date one share of Common Stock for each RSU that vests.
RSUs will only be settled in shares of Common Stock. Any other settlement method would be
considered an exception and would have to be approved separately by the Committee.

6.2. If a Participant’s employment with the Company terminates before an RSU Vesting Date, the RSU
will be forfeited when the Participant’s employment with the Company terminates, except (i) in
connection with a Qualifying Retirement or death or disability (each as outlined below), or (ii) if
the Participant is rehired by the Company within ninety days of termination, in which case the
Participant shall be construed to have been continuously employed by the Company for purposes of
vesting and payout.

6.3. If the employment of a Participant terminates in a Qualifying Retirement then (i) if the date
of such termination is after the calendar year of the Grant Date, the RSUs will remain eligible for
payout on the terms provided in Section 6.1, or (ii) if the date of such termination is in the
calendar year of the Grant Date a portion of the RSUs shall remain eligible for payout on the terms
provided in Section 6.1, which portion shall be determined as follows: (# RSUs awarded) * (# of
months worked in that year, rounded to nearest whole month) / 12.

6.4. If the employment with the Company of a Participant is terminated due to death or disability,
the RSUs shall vest as follows: (i) if the date of such termination is after the calendar year of
the Grant Date, all the RSUs shall pay out within sixty days, or (ii) if the date of such
termination is in the calendar year of the Grant Date a portion of the RSUs shall pay out as
provided in (i), which portion shall be determined as follows: (# RSUs awarded) * (# of months
worked in that year, rounded to nearest whole month) / 12.

6.5. The RSUs shall not be transferable and may not be sold, assigned, pledged, hypothecated or
otherwise encumbered.

6.6. A transfer of employment within the Company will not constitute a termination of employment
within the meaning of the Plan.

6.7. Until the shares of Common Stock have been delivered or otherwise made available as provided
in Section 6.1, the Participant shall not be treated as a shareholder as to those shares of Common
Stock relating to the RSUs. Notwithstanding the foregoing, the Participant shall be permitted to
receive additional RSUs with respect to the RSUs based upon the dividends and distributions paid on
shares of Common Stock to the same extent as if each RSU were a share of Common Stock, which
additional RSUs shall be delivered or made available at the same time and to the same extent as the
RSUs to which they relate or as otherwise determined by the Company.

 

 

7. Change in Control

Notwithstanding any other provision of the Program or this Plan (and in lieu of vesting at the
times otherwise provided in the Program), if the termination of employment of a Participant occurs
upon or within twenty-four (24) months following a Change in Control by reason of (a) termination
by the Company for reasons other than for Cause or (b) termination by the Participant for Good
Reason, then (i) all Awards shall become immediately vested and exercisable, and (ii) in the case
of PSUs, all performance targets shall be deemed to be met at 100% of the Target Grant (consistent
with the table in Section 5.1), as may be equitably increased in the discretion of the Committee to
reflect actual performance through the date of the Change in Control.

 

 

8. Additional Definitions

For purposes of the Plan, the following capitalized terms shall have the meanings provided below.

“Affiliate” shall have the meaning set forth in Rule 12b-2 promulgated under Section 12 of
the Securities Exchange Act of 1934, as amended.

“Cause” means (i) the willful and continued failure by the Participant to substantially
perform his duties with the Company that has not been cured within 30 days after written demand for
substantial performance is delivered by the Company, which demand specifically identifies the
manner in which the Participant has not substantially performed (other than any such failure
resulting from the Participant’s incapacity due to physical or mental illness), (ii) the willful
engaging by the Participant in conduct which is demonstrably and materially injurious to the
Company, monetarily or otherwise, or (iii) the engaging by the Participant in egregious misconduct
involving serious moral turpitude, determined in the reasonable judgment of the Committee. For
purposes hereof, no act, or failure to act, on the Participant’s part shall be deemed “willful”
unless done, or omitted to be done, by the Participant not in good faith and without reasonable
belief that such action was in the best interest of the Company. Notwithstanding the foregoing, if
a Participant is a party to a Change in Control Agreement, “Cause” with respect to such Participant
shall have the meaning given to such term in the Change in Control Agreement.

“Change in Control” means the first to occur of any of the following: (i) any Person is or
becomes the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or
indirectly, of securities of Baxter (not including in the securities beneficially owned by such
Person any securities acquired directly from the Company or its Affiliates) representing 30% or
more of the combined voting power of Baxter’s then outstanding securities, excluding any Person who
becomes such a beneficial owner in connection with a merger or consolidation of Baxter or any
direct or indirect subsidiary of Baxter with any other corporation immediately following which the
individuals who comprise the Board immediately prior thereto constitute at least a majority of the
board of directors of (A) any parent of Baxter or the entity surviving such merger or consolidation
or (B) if there is no such parent, of Baxter or such surviving entity; (ii) the following
individuals cease for any reason to constitute a majority of the number of directors then serving:
individuals who, on the Grant Date, constitute the Board and any new director (other than a
director whose initial assumption of office is in connection with an actual or threatened election
contest, including but not limited to a consent solicitation, relating to the election of directors
of Baxter) whose appointment or election by the Board or nomination for election by Baxter’s
shareholders was approved or recommended by a vote of at least two-thirds (2/3) of the directors
then still in office who either were directors on the Grant Date or whose appointment, election or
nomination for election was previously so approved or recommended; (iii) there is consummated a
merger or consolidation of Baxter or any direct or indirect subsidiary of Baxter with any other
corporation or other entity, other than a merger or consolidation immediately following which the
individuals who comprise the Board immediately prior thereto constitute at least a majority of the
board of directors of (A) any parent of Baxter or the entity surviving such merger or consolidation
or (B) if there is no such parent, of Baxter or such surviving entity; or (iv) the shareholders of
Baxter approve a plan of complete liquidation

 

 

or dissolution of Baxter or there is consummated an
agreement for the sale or disposition by Baxter of all or substantially all of Baxter’s assets,
other than a sale or disposition by Baxter of all or substantially all of Baxter’s assets
immediately following which the individuals who comprise the Board immediately prior thereto
constitute at least a majority of the board of directors of (A) any parent of Baxter or of the
entity to which such assets are sold or disposed or (B) if there is no such parent, of Baxter or
such entity.

“Change in Control Agreement” means an employment agreement, change in control agreement or
plan, severance agreement or plan, or other agreement between the Company and a Participant or
Company plan covering a Participant that provides for benefits upon termination for good reason or
cause in connection with a change in control of Baxter and that has been approved by the Board or
the Committee.

“Good Reason” means the occurrence (without the Participant’s express written consent) of
any of the following which occur on or after a Change in Control: (i) reduction by the Company in
the Participant’s annual base salary as in effect on the Grant Date or as the same may be increased
from time to time; (ii) the relocation of the Participant’s principal place of employment to a
location more than fifty (50) miles from the Participant’s principal place of employment
immediately prior to the Change in Control or the Company’s requiring the Participant to be based
anywhere other than such principal place of employment (or permitted relocation thereof) except for
required travel on the Company’s business to an extent substantially consistent with the
Participant’s business travel obligations as in effect immediately prior to the Change in Control;
or (iii) the failure by the Company to pay to the Participant any portion of the Participant’s
current compensation or to pay to the Participant any portion of an installment of deferred
compensation under any deferred compensation program of the Company, within seven (7) days of the
date such compensation is due. Notwithstanding the foregoing, if a Participant is a party to a
Change in Control Agreement, “Good Reason” with respect to such Participant shall have the meaning
given to such term in the Change in Control Agreement.

“Person” shall have the meaning given in Section 3(a)(9) of the Securities Exchange Act of
1934, as amended, as modified and used in Sections 13(d) and 14(d) thereof, except that such term
shall not include (i) Baxter or any of its subsidiaries, (ii) a trustee or other fiduciary holding
securities under an employee benefit plan of Baxter or any of its Affiliates, (iii) an underwriter
temporarily holding securities pursuant to an offering of such securities, or (iv) a corporation
owned, directly or indirectly, by the shareholders of Baxter in substantially the same proportions
as their ownership of stock of Baxter.

9. Withholding

Except as otherwise provided by the Committee, all Awards (including the payout of Awards) under
the Plan are subject to withholding of all applicable taxes, which withholding obligations may be
satisfied, with the consent of the Committee, through the surrender of shares of Company Common
Stock that the Participant already owns or to which a Participant is otherwise entitled under the
Plan; provided, however, with the consent of the Committee, previously-owned Shares that have been
held by the Participant or Shares to which the Participant is entitled under the Plan may only be
used to satisfy the minimum tax withholding required by applicable law (or other rates that will
not have a negative accounting impact).

 

 

10. Program Controls

Except as specifically provided in the Plan, in the event of any inconsistency between the Plan and
the Program, the Program will control, but only to the extent such Program provisions will not
violate the provisions of section 409A of the Code.

 

 

BAXTER INTERNATIONAL INC.

French Addendum To 2011 Equity Plan

Adopted as of March 4, 2011

1. PURPOSES OF THIS ADDENDUM

The Baxter International Inc. 2007 Incentive Plan (the “Program”) was adopted by the Board
of the Company on February 13, 2007 and approved by the shareholders of the Company on May 1, 2007
for the benefit of employees, officers and directors, of the Company and its Affiliates, including
its French subsidiary(ies).

This Addendum (the “Addendum”) approved on March 4, 2011, sets out the terms for French
Qualified Stock Options and French Qualified Free Shares granted jointly under the 2007 Incentive
Plan (the “Program”) and the Equity Plan (the “Plan”) adopted as of March 4, 2011
by Baxter International Inc. (the “Company”) to Eligible Participants, residents in France,
or otherwise selected by the Committee for participation under this Addendum. This Addendum is
adopted in accordance with Sections 3 “Administration” and 9 “Amendment and Termination” of the
Program to benefit from the specific tax and social security treatment applicable in France to
Qualified Option Awards and Qualified Free Share Awards.

For the avoidance of doubt, the present Addendum is not applicable to awards paid in cash and to
awards of Performance Shares, Restricted Shares, Performance Units, Cash Incentive Awards or Stock
Appreciation Rights. Consequently, dispositions of the Program and/or the Plans applicable to these
are not applicable to Awards made further to the present Addendum.

The rules contained in the Program and the Plans will apply to Awards made under this Addendum,
unless specifically stated otherwise. The terms and conditions of the present Addendum are
identical to the Plan except as provided below. Words and expressions used in this Addendum and not
defined herein shall have the same meaning as those words and expressions used in the Program and
Plans. The additional terms and conditions in this Addendum are to be read in conjunction with the
Program and Plans.

To the extent that the Program and the Plans contradict the provisions set forth hereinafter, the
Addendum provisions shall prevail. In addition, to the extent that the terms and conditions
specified in the applicable grant communication letter contradict the provisions set forth
hereinafter, the Addendum provisions shall prevail.

2. OPTION AWARDS

2.1. General

The Addendum contains the term of “Qualified Stock Option” which refers to the awards of Options
granted as per Section 6 of the Program jointly with Section 4 of the Equity Plan in accordance
with articles L.225-177 to L.225-185 of the French Commercial Code. Consequently, the terms “Stock
Option”, “Options”, “Qualified Stock Option Awards” and “Option Award” herein shall be construed
and interpreted accordingly.

 

 

2.2. Grant of Options

Notwithstanding the provisions of the Plan, the following rules shall apply to Options Awards
granted under this Addendum.

In no event shall the number of shares of Common Stock subject to outstanding unexercised Options
granted pursuant to this Addendum give right to subscribe shares exceeding one-third (1/3) of the
Company’s share capital. The total number of shares of Common Stock that may be granted to
Participants under this Addendum shall not exceed 10% of the Granting Company’s share capital at
Grant Date, when Options are over existing shares. Outstanding unvested Full Value Awards shall be
treated as shares of Common Stock in order to determine the threshold of 10% of the granting
Company’s share capital.

If an Option provides a right to acquired already existing shares / treasury shares, the Company
shall procure sufficient shares to satisfy the Exercise of such Option at least one day prior to
the Participant’s having the right to Exercise such Option. Shares acquired by the Participant
upon Option Exercise shall be registered in the name of the Participant or held in an identifiable
account. Participants will have the voting and dividend rights attached to the Shares acquired upon
Exercise Date as of that date. Upon Exercise, no cash replacement of shares of Common Stock is
allowed.

Any market repurchased shares of Common Stock to be delivered to Eligible Individuals upon exercise
of Awards granted hereunder shall be acquired by the Company at least one (1) day before the
applicable vesting date. The Vesting Date designates the date upon which options, in full or in
part, become exercisable by the Participant.

2.3. Grant Date

No Options may be granted under this Addendum: (a) before the end of a period of twenty (20)
trading days following (i) a dividend record date for any dividend or (ii) an agreement by the
shareholders of the Company to increase the issued share capital of the Company; (b) within a
period of ten (10) trading days before and after the publication of consolidated accounting results
of the Company (e.g., the filing of an Annual Report on Form 10-K); or (c) within a period
beginning with the date upon which the Company’s executive officers become aware of any nonpublic
information that, if it were to become publicly known, would reasonably be expected to affect the
value of the Company’s shares of Common Stock and ending ten (10) trading days after that
information has been publicized.

The Grant Date shall be the date upon which the Committee approves grants to Eligible Individuals
or as soon thereafter as possible, ensuring that the above dispositions are respected. The Grant
date shall be stated in the grant documentation letter.

2.4. Eligible Individuals

Notwithstanding the provisions of Sections 2(k) and 4 of the Plan, Section 2 of the Equity Plan,
Options may only be granted under this Addendum to Eligible Individuals. No Option Award may be
made to Eligible Individuals holding more than ten percent (10%) of the issued share capital in the
Company.

 

 

2.5. Option Price

The Option Price shall be the greatest of: (a) the Fair Market Value of a share of Common Stock on
the Grant Date; (b) eighty percent (80%) of the average opening price of a share of Common Stock
over the twenty (20) trading days preceding Grant Date; (c) if treasury shares are used to satisfy
exercise of the Options, eighty percent (80%) of the average repurchase price per share paid by the
Company for such treasury shares. The Option Price is stated in the grant documentation letter and
is fixed on the Grant Date.

2.6. Adjustment to Option Price

The number of Options and the Option Price for grants made pursuant to this Addendum may be
adjusted in connection with changes in capital operations described in article L.225-181 of the
French Commercial Code so that economic rights are maintained.

2.7. Vesting and Exercise of Options

Options granted pursuant to this Addendum shall first become exercisable on the fourth (4th)
anniversary of the Grant Date. In case of earlier exercise of Options further notably to Change of
Control or Termination of Employment, the Committee may, upon discretionary decision, impose a
share sale restriction to the Participant until the fourth anniversary of grant to secure
eligibility to the French stock-option regime.

2.8. Termination of Employment

Notwithstanding anything to the contrary, no Option may be exercised before the first anniversary
of the Grant Date and shares underlying Options exercised before the fourth anniversary of the
Grant Date shall be subject to a share sale restriction until the fourth anniversary of grant. By
exception, the Committee may discretionarily decide that Options may be exercised at an earlier
date and / or shares sold at an earlier date.

If a Participant’s employment with the Company terminates after the Participant’s Options become
exercisable, the Options will not expire immediately but will remain exercisable. Subject to
Section 4.6 of the Plans, and except in the event of a Qualifying Retirement, the Options will
expire ninety days after the Participant’s employment with the Company terminates. If the
Participant dies or becomes disabled during the ninety-day period, the Options will expire on the
first anniversary of the termination date.

If the employment of a Participant who is at least 65 years of age, or at least 55 years of age
with at least 10 years of employment with the Company, is terminated other than for Cause or by
reason of the Participant’s death or disability (a “Qualifying Retirement”) then (i) if the
date of such termination is after the calendar year of the Grant Date, the Options shall continue
to vest as provided in Section 2.7, or (ii) if the date of such termination is in the calendar year
of the Grant Date, a portion of the Options shall continue to vest as provided in Section 2.7,
which portion shall be determined as follows: (# shares covered by Option award) * (# of months
worked in that year, rounded to nearest whole month) / 12. Subject to Section 4.6 of the Plans, the
Participant’s Options (whether vesting pursuant to (i) or (ii) or previously vested) shall expire
on the fifth anniversary of the termination date.

 

 

If the employment of a Participant is terminated due to death, all Options shall vest immediately
and the shares shall be immediately transferable.

If the employment of a Participant is terminated due to disability corresponding to the 2nd or 3rd
categories of Article L.341-4 of the French Social Security Code 1, then (i) if the date of such
termination is after the calendar year of the Grant Date, the Options shall vest immediately, or
(ii) if the date of such termination is in the calendar year of the Grant Date, a portion of the
Options shall vest immediately, which portion shall be determined as follows: (# shares covered by
Option award) * (# of months worked in that year, rounded to nearest whole month) / 12. Subject to
Section 4.6, such Options will expire on the first anniversary of the termination date. The shares
acquired upon option exercise shall be immediately transferable.

If the employment of a Participant is terminated due to disability other than to the 2nd or 3rd
categories of Article L.341-4 of the French Social Security Code, then (i) if the date of such
termination is after the calendar year of the Grant Date, the Options shall continue to vest as
provided in Section 2.7, or (ii) if the date of such termination is in the calendar year of the
Grant Date, a portion of the Options shall continue to vest as provided in Section 2.7, which
portion shall be determined as follows: (# shares covered by Option award) * (# of months worked in
that year, rounded to nearest whole month) / 12. Subject to Section 4.6, such Options will expire
on the first anniversary of the termination date.

2.9. Substitution of SARs for Options – Tandem Awards

Neither SARs nor any other incentive may be substituted for Options granted pursuant to this
Addendum. No tandem awards may be made pursuant to this Addendum.

3. FULL VALUE AWARDS

3.1. Definitions

“Full Value Award” means a grant made by Baxter International Inc. to the Participant of a
right to receive one Share in the future at a nil cost, in the form of a Restricted Stock Unit.
Such grant can be paid exclusively in shares of Common Stock, is awarded respectively in accordance
with Section 7 of the Program, in accordance with Section 5 of the 2011 Annual Equity Plan for
Restricted Stock Units, and in accordance with articles L.225-197-1 to L.225-197-6 of the French
Commercial Code on Qualified Free Shares Awards. Such grant cannot be subject to conditions,
restrictions and contingencies relating to dividend or dividend equivalent rights and deferred
payment or settlement. The purpose of this Addendum is to ensure that grants over shares of Common
Stock are in conformity with the applicable French legislation, and are entitled to the
corresponding specific French tax and social security treatment. One (1) award gives right to
acquire one (1) share subject to satisfaction of applicable considerations, contingencies,
conditions, restrictions, if any.

“Grant Date” means the date on which the Committee designates the Participant eligible to
receive a Full Value Award further to the present Addendum, and specifies the terms and conditions
of such Award, including the maximum number of underlying shares, the Vesting and Share Sale
Restriction Periods. The Grant Date is stated in the grant communication letter.

 

 

“Vesting Date” means the date on which the Participant acquires the shares of Common Stock.
The Vesting Date is stated in the grant communication letter.

3.2. Grant

Notwithstanding the provisions of the Plan, the following rules shall apply to Full Value Awards
granted under this Addendum.

The total number of shares of Common Stock that may be granted to Participants under this Addendum
shall not exceed 10% of the Granting Company’s share capital at Grant Date. Outstanding unvested
Full Value Awards shall be treated as shares of Common Stock in order to determine the threshold of
10% of the granting Company’s share capital. Shares of Common Stock of the Company to be delivered
under the Plan may be market repurchased shares (already existing shares) or newly issued shares.
For Full Value Awards granted over already existing shares, corresponding shares shall be
repurchased by the Company at least one day before the applicable Vesting Date.

A Full Value Award may not be made to employees and/or Corporate Officers holding more than 10% of
the issued share capital in the Company or who, after having received shares under a Full Value
Award granted hereunder, would hold more than 10% of the issued share capital in the Company.

Shares acquired by the Participant upon Vesting Date will be registered in the name of the
Participant or be held in an identifiable account. Participants will have the voting and dividend
rights attached to the Shares acquired upon Vesting Date as of that date.

3.3. Vesting period / Performance period

Notwithstanding anything to the contrary, in relation to Full Value Awards, the Vesting Date shall
not be earlier than the second anniversary of the Grant Date, in any circumstances other than in
the event of the death of the Participant or in the event of disability corresponding to the 2nd or
3rd categories of Article L.341-4 of the French Social Security Code1.

Unless otherwise stated in the grant documentation letter, the Vesting Date for Restricted Stock
Units shall be the second anniversary of the Grant Date. The Board of Directors or the Committee
reserves the right to reduce or modify the Vesting Date in accordance with and to conform with any
amendments to the French Tax Code and/or to the provisions of the French Commercial Code governing
Qualified Free Shares. By exception, the Board or the Committee may discretionarily decide that
Vesting Date may occur before the second (2nd) anniversary of the Grant Date.

 

			
	1	 	For information purposes, please note
that
	 
	-	 	Second category stands for a disabled person unable to perform any
professional activity; and
	 
	-	 	Third category stands for a disabled person unable to perform any
professional activity and requiring third party assistance in order to perform
everyday life tasks.

 

 

3.4. Share Sale Restriction Period

As of the Vesting Date, shares of Common Stock acquired pursuant to Full Value Award are subject to
a minimum of two (2) year share sale restriction, during which the shares may not be sold (the
“Share Sale Restriction Period”). If the Participant leaves the employment of the Company
or any Affiliate(s), at any time after the Vesting Date, the shares acquired shall not be freely
transferable before the expiration of the Share Sale Restriction Period.

By exception, in the event of the Participant’s death, the heirs shall not be subject to the Share
Sale Restriction Period, the shares being freely transferable upon the Participant’s death. By
exception, notwithstanding any provision of the Plan and the present Addendum to the contrary, in
case of disability corresponding to the 2nd or 3rd categories of Article L.341-4 of the French
Social Security Code1, the Participant is entitled to sell the shares prior to the end of the Share
Sale Restriction Period, if any.

For the avoidance of doubt, if the Participant leaves the employment, the Company or any
Affiliate(s), at any time before the term of the Share Sale Restriction Period, due to his/her
Disability other than of second (2nd) or third (3rd) category as defined in Article L.341-4 of the
French Social Security Code1, the Participant shall not be entitled to sale the shares before the
second (2nd) anniversary of the Vesting Date.

By exception, the Board or the Committee may discretionarily decide that a Participant shall not be
subject to the Share Sale Restriction Period.

3.5. Additional Full Value Awards

Notwithstanding anything to the contrary in the Program or the Plans, the Participant shall not be
permitted to receive additional Full Value Awards with respect to the Restricted Stock Units based
upon the dividends and distributions paid on shares of Common Stock as if each Restricted Stock
Unit was a share of Common Stock.

3.6. Termination of Employment

Notwithstanding anything to the contrary in the Program or the Plans, in case of Participant’s
death, his/her heirs may request the acquisition of the unvested Restricted Stock Units within six
(6) months following this event.

By exception, if the Participant ceases his employment within the Company or any Affiliate(s) due
to his disability corresponding to the 2nd or 3rd categories of Article L.341-4 of the French
Social Security Code1, the Award shall vest as follows: (i) if the date of such
termination is after the calendar year of the Grant Date, all the RSUs shall pay out within sixty
days, or (ii) if the date of such termination is in the calendar year of the Grant Date a portion
of the RSUs shall pay out as provided in (i), which portion shall be determined as follows: (#
RSUs awarded) * (# of months worked in that year, rounded to nearest whole month) / 12.

Notwithstanding anything to the contrary, if the employment with the Company or any Affiliate(s) is
terminated due to disability other than of second (2nd) or third (3rd) category as defined in
Article L.341-4 of the French Social Security Code, (i) if the date of such termination

 

 

is after
the calendar year of the Grant Date, the RSUs will remain eligible for payout on the terms provided
in Section 3.3, or (ii) if the date of such termination is in the calendar year of the Grant Date a
portion of the RSUs shall remain eligible for payout on the terms provided in Section 3.3, which
portion shall be determined as follows: (# RSUs awarded) * (# of months worked in that year,
rounded to nearest whole month) / 12.

Notwithstanding anything to the contrary, if the employment with the Company or any Affiliate(s) is
terminated due to Qualified Retirement, (i) if the date of such termination is after the calendar
year of the Grant Date, the RSUs will remain eligible for payout on the terms provided in Section
3.3, or (ii) if the date of such termination is in the calendar year of the Grant Date a portion of
the RSUs shall remain eligible for payout on the terms provided in Section 3.3, which portion shall
be determined as follows: (# RSUs awarded) * (# of months worked in that year, rounded to nearest
whole month) / 12.

4. Non-Transferability of Awards

No Award granted under the Plan shall be transferable other than by will or the law of descent and
distribution.

4.1. Change in Control

When a tax favourable treatment may be available further to French legislation (article 163 bis C-1
bis of the French Tax Code), the Committee, upon discretionary decision, may give the choice to
French participants, but has no obligation to. When the Company decides to exchange shares with no
cash consideration, pursuant to applicable French legal and tax rules and notably, article
L.225-197-1 § III of the French Commercial Code (as amended), then the dispositions of the Plan as
well as the periods of Vesting and Share Sale Restriction will remain applicable to shares or
rights received in exchange.

5. Tax Withholding

Notwithstanding any provision to the contrary, no shares of Common Stock may be used to satisfy any
social security or tax withholding due for Awards granted further to the present Addendum.

The Company or its Affiliates shall have the right to require payment from a Participant to cover
any applicable withholding or other employment taxes due with respect to Awards granted hereunder
or shall have the right to deduct any applicable withholding or other employment taxes due from
other compensation income paid to the Participant.

6. Amendment, Modifications to this Addendum.

No modification can be made to this Addendum, or to outstanding Awards granted hereunder, which is
disadvantageous to the Participant or which is in contradiction to the French Commercial Code and
French Tax Code provisions, unless the modification is the result of a new law or regulation or any
other obligatory disposition or ruling applied to the Company or any other Subsidiary, having
legal, fiscal or social implications.

 

 

The terms of this Addendum shall be interpreted in accordance with the relevant provisions set
forth by French tax and social laws, as well as the regulations issued by the French tax and social
administrations.

In the event of any conflict between the provisions of this Addendum and the Plan, the provisions
of the Addendum shall prevail for any Awards made to Participants under this Addendum.

7. Additional Definitions

“Affiliate” means any entity:

	 	-	 	in which the Company holds, directly or indirectly, at least 10% of the voting rights
and / or equity;
	 
	 	-	 	that holds, directly or indirectly, at least 10% of the voting rights and / or equity
in the Company;
	 
	 	-	 	in which at least 50% of the equity or voting rights are held, directly or indirectly,
by a company which itself holds at least 50% of the Company.

“Company” means Baxter International Inc., a Delaware corporation.

“Corporate Officers” mean “Président du Conseil d’Administration” (Chairman of the Board);
“Directeur Général” (Managing Director); “Directeurs Généraux Délégués” (Delegated Managing
Directors); Members of the “Directoire”; “Gérant” of a “Société en Commandite par Actions”;
“Président” (if a private individual) d’une Société par Actions Simplifiée”.

“Eligible Individual” means any employee with a valid employment contract (“contrat de
travail”) at Grant Date, and/or Corporate Officer with or without an employment contract with the
Company or Affiliate(s). For the avoidance of doubt, officers and directors of the Company, or of
Affiliate(s), are eligible Participants if they have a valid employment contract with one of these
entities, or if they are Corporate Officers. Awards cannot be granted under this Addendum to
non-employee members of a “Conseil d’Administration” (the Board), to consultant, to independent
agent of the Company or Affiliate(s).

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