Document:

Exhibit 10.3

 

 

 

 

 

 

ADMINISTRATION AGREEMENT

 

among

 

HARLEY-DAVIDSON MOTORCYCLE TRUST 2019-A,

 

as Issuer,

 

HARLEY-DAVIDSON CREDIT CORP.,

 

as Administrator,

 

HARLEY-DAVIDSON CUSTOMER FUNDING CORP.,

 

as Trust Depositor,

 

and

 

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,

 

as Indenture Trustee

 

Dated as of June 1, 2019

 

 

 

TABLE OF CONTENTS

 

 

	
SECTION 1.
    	
DUTIES   OF THE ADMINISTRATOR
    	
1
    
	
SECTION 2.
    	
RECORDS
    	
7
    
	
SECTION 3.
    	
COMPENSATION
    	
7
    
	
SECTION 4.
    	
ADDITIONAL   INFORMATION TO BE FURNISHED TO THE ISSUER
    	
7
    
	
SECTION 5.
    	
INDEPENDENCE   OF THE ADMINISTRATOR
    	
7
    
	
SECTION 6.
    	
NO   JOINT VENTURE
    	
7
    
	
SECTION 7.
    	
OTHER   ACTIVITIES OF ADMINISTRATOR
    	
8
    
	
SECTION 8.
    	
TERM   OF AGREEMENT; RESIGNATION AND REMOVAL OF ADMINISTRATOR
    	
8
    
	
SECTION 9.
    	
ACTION   UPON TERMINATION, RESIGNATION OR REMOVAL
    	
9
    
	
SECTION 10.
    	
NOTICES
    	
9
    
	
SECTION 11.
    	
AMENDMENTS
    	
9
    
	
SECTION 12.
    	
SUCCESSORS   AND ASSIGNS
    	
10
    
	
SECTION 13.
    	
GOVERNING   LAW
    	
10
    
	
SECTION 14.
    	
HEADINGS
    	
10
    
	
SECTION 15.
    	
COUNTERPARTS
    	
10
    
	
SECTION 16.
    	
SEVERABILITY
    	
10
    
	
SECTION 17.
    	
NOT   APPLICABLE TO HARLEY-DAVIDSON IN OTHER CAPACITIES
    	
10
    
	
SECTION 18.
    	
LIMITATION   OF LIABILITY OF OWNER TRUSTEE AND INDENTURE TRUSTEE
    	
10
    
	
SECTION 19.
    	
THIRD-PARTY   BENEFICIARY
    	
11
    
	
SECTION 20.
    	
SURVIVABILITY
    	
11
    

 

 

This Administration Agreement (this “Agreement”), dated as of June 1, 2019, among Harley-Davidson Motorcycle Trust 2019-A (the “Issuer”), Harley-Davidson Credit Corp. (together with its successors and assigns “Harley-Davidson Credit” and in its capacity as administrator, the “Administrator”), Harley-Davidson Customer Funding Corp. (the “Trust Depositor”), and The Bank of New York Mellon Trust Company, N.A., not in its individual capacity but solely as Indenture Trustee (together with its successors and assigns, the “Indenture Trustee”).

 

 

W I T N E S S E T H:

 

WHEREAS, the Issuer is issuing the Notes pursuant to the Indenture, dated as of the date hereof (the “Indenture”), between the Issuer and the Indenture Trustee (capitalized terms used herein that are not otherwise defined shall have the meanings ascribed thereto in the Indenture or the Sale and Servicing Agreement);

 

WHEREAS, the Issuer has entered into certain agreements in connection with the issuance of the Notes including (i) a Sale and Servicing Agreement, dated as of the date hereof (the “Sale and Servicing Agreement”), among the Issuer, the Indenture Trustee, the Trust Depositor and Harley-Davidson Credit, as servicer (together with its successors and assigns in such capacity, the “Servicer”), and (ii) the Indenture (collectively referred to hereinafter as the “Transaction Documents”);

 

WHEREAS, pursuant to the Transaction Documents, the Issuer and the Owner Trustee are required to perform certain duties in connection with (i) the Notes and the collateral therefor pledged pursuant to the Indenture (the “Collateral”) and (ii) the beneficial ownership interest in the Issuer;

 

WHEREAS, the Issuer and the Owner Trustee desire to have the Administrator perform certain of the duties of the Issuer and the Owner Trustee referred to in the preceding clause and to provide such additional services consistent with the terms of this Agreement and the Transaction Documents as the Issuer and the Owner Trustee may from time to time request; and

 

WHEREAS, the Administrator has the capacity to provide the services required hereby and is willing to perform such services for the Issuer and the Owner Trustee on the terms set forth herein;

 

NOW, THEREAFTER, in consideration of the mutual covenants contained herein, and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

 

Section 1.                                  Duties of the Administrator.

 

(a)                               Duties with respect to the Indenture.

 

(i)                                  The Administrator agrees to perform all its duties as Administrator and the duties of the Issuer and the Owner Trustee under the Indenture and the Sale and Servicing Agreement.  

 

 

In addition, the Administrator shall consult with the Owner Trustee  regarding the duties of the Issuer or the Owner Trustee under the Indenture.  The Administrator shall monitor the performance of the Issuer and shall advise the Owner Trustee when action is necessary to comply with the respective duties of the Issuer and the Owner Trustee under the Indenture.  The Administrator shall prepare for execution by the Issuer, or shall cause the preparation by other appropriate persons of, all such documents, reports, filings, instruments, certificates and opinions that it shall be the duty of the Issuer or the Owner Trustee to prepare, file or deliver pursuant to the Indenture.  In furtherance of the foregoing, the Administrator shall take all appropriate action that the Issuer or the Owner Trustee is required to take pursuant to the Indenture including, without limitation, such of the following as are required with respect to the foregoing matters under the Indenture (references are to Sections of the Indenture):

 

(A)                           the duty to cause the Note Register to be kept and to give the Indenture Trustee notice of any appointment of a new Note Registrar and the location, or change in location, of the Note Register (Section 2.04);

 

(B)                            the notification of Noteholders of the final principal payment on their Notes (Section 2.07(b));

 

(C)                            the fixing or causing to be fixed of any special record date and the notification of the Indenture Trustee and Noteholders with respect to special payment dates, if any (Section 2.07(c));

 

(D)                           the preparation of or obtaining of the documents and instruments required for execution and authentication of the Notes and delivery of the same to the Indenture Trustee (Section 2.02);

 

(E)                             the preparation, obtaining or filing of the instruments, opinions and certificates and other documents required for the release of Collateral (Section 2.12);

 

(F)                              the maintenance of an office for registration of transfer or exchange of Notes (Section 3.02);

 

(G)                           the duty to cause newly appointed Paying Agents, if any, to deliver to the Indenture Trustee the instrument specified in the Indenture regarding funds held in trust (Section 3.03);

 

(H)                           the direction to the Indenture Trustee to deposit monies with Paying Agents, if any, other than the Indenture Trustee (Section 3.03);

 

(I)                                 the obtaining and preservation of the Issuer’s qualification to do business in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of the Indenture, the Notes, the Collateral and each other instrument and agreement included in the Collateral (Section 3.04);

 

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(J)                                the preparation of all supplements and amendments to the Indenture and all financing statements, continuation statements, instruments of further assurance and other instruments and the taking of such other action as is necessary or advisable to protect the Collateral other than as prepared by the Servicer (Section 3.05);

 

(K)                           the delivery of the Opinion of Counsel on the Closing Date and certain other statements as to compliance with the Indenture (Sections 3.06 and 3.09);

 

(L)                             the identification to the Indenture Trustee in an Officer’s Certificate of a Person with whom the Issuer has contracted to perform its duties under the Indenture (Section 3.07(b));

 

(M)                         the notification of the Indenture Trustee and each Rating Agency of an Event of Termination under the Sale and Servicing Agreement and of the appointment of a Successor Servicer (Section 3.07(d));

 

(N)                           the duty to cause the Servicer to comply with Article Five and Article Nine of the Sale and Servicing Agreement (Section 3.14);

 

(O)                           the preparation and obtaining of documents and instruments required for the release of the Issuer from its obligations under the Indenture (Section 3.10(b) and Section 3.11(b));

 

(P)                              the delivery of written notice to the Indenture Trustee and each Rating Agency of each Event of Default under the Indenture and each Event of Termination by the Servicer under the Sale and Servicing Agreement (Section 3.18);

 

(Q)                           the delivery of written notice to each Rating Agency of amendments to the Sale and Servicing Agreement (Section 3.21);

 

(R)                            the monitoring of the Issuer’s obligations as to the satisfaction and discharge of the Indenture and the preparation of an Officer’s Certificate and the obtaining of the Opinion of Counsel and the Independent Certificate relating thereto (Section 4.01);

 

(S)                              the compliance with any written directive of the Indenture Trustee with respect to the sale of the Collateral in a commercially reasonable manner if an Event of Default shall have occurred and be continuing and the delivery of written notice of such sale to the Rating Agencies (Section 5.04);

 

(T)                             the preparation and delivery of notice to Noteholders of the removal of the Indenture Trustee and the appointment of a successor Indenture Trustee (Section 6.08);

 

(U)                           the preparation of any written instruments required to confirm more fully the authority of any co-trustee or separate trustee and any written instruments necessary in connection with the resignation or removal of the Indenture Trustee or any co-trustee or separate trustee (Sections 6.08 and 6.10);

 

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(V)                           the delivery of notice to the Rating Agencies of a successor Indenture Trustee by merger, conversion or consolidation of the Indenture Trustee (Section 6.09);

 

(W)                        the furnishing of the Indenture Trustee with the names and addresses of Noteholders during any period when the Indenture Trustee is not the Note Registrar (Section 7.01);

 

(X)                           the opening of one or more accounts in the Indenture Trustee’s name, the preparation and delivery of Issuer Orders, Officer’s Certificates and Opinions of Counsel and all other actions necessary with respect to investment and reinvestment of funds in the Trust Accounts (Sections 8.02 and 8.03);

 

(Y)                           the preparation of an Issuer Request and Officer’s Certificate and the obtaining of an Opinion of Counsel and Independent Certificates, if necessary, for the release of the Collateral (Sections 8.04 and 8.05);

 

(Z)                             the preparation of Issuer Orders and the obtaining of Opinions of Counsel with respect to the execution of supplemental indentures and the mailing to the Rating Agencies and the Noteholders of notices with respect to such supplemental indentures (Sections 9.01, 9.02 and 9.03);

 

(AA)                the execution and delivery of new Notes conforming to any supplemental indenture (Section 9.06);

 

(BB)                  the duty to notify each Rating Agency and the Indenture Trustee of redemption of the Notes (Section 10.01);

 

(CC)                  the preparation and delivery of all Officer’s Certificates, Opinions of Counsel and Independent Certificates with respect to any requests by the Issuer to the Indenture Trustee to take any action under the Indenture (Section 11.01(a));

 

(DD)                the preparation and delivery of Officer’s Certificates and the obtaining of Independent Certificates, if necessary, for the release of property from the lien of the Indenture (Section 11.01(b));

 

(EE)                    the preparation and delivery to Noteholders and the Indenture Trustee of any agreements with respect to alternate payment and notice provisions (Section 11.06);

 

(FF)                       the recording of the Indenture, if applicable (Section 11.15); and

 

(GG)                the appointment of a successor Indenture Trustee (Section 6.08).

 

(ii)                              The Administrator will:

 

(A)                           except as otherwise expressly provided in the Indenture, which provides for the payment of the Indenture Trustee Fee, pay the Indenture Trustee’s fees and reimburse the 

 

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Indenture Trustee upon its request for all reasonable expenses, disbursements and advances  incurred or made by the Indenture Trustee in accordance with any provision of the Indenture (including the reasonable compensation, expenses and disbursements of its agents and counsel), except any such expense, disbursement or advance as may be attributable to its negligence or bad faith;

 

(B)                            indemnify the Indenture Trustee and its agents for, and hold them harmless against, any loss, liability or expense incurred without negligence or bad faith on their part, arising out of or in connection with the acceptance or administration of the transactions contemplated by the Indenture, including the reasonable costs and expenses of defending themselves against any claim or liability in connection with the exercise or performance of any of their powers or duties under the Indenture;

 

(C)                            indemnify the Owner Trustee and its agents for, and hold them harmless against, any loss, liability or expense incurred without negligence or bad faith on their part, arising out of or in connection with the acceptance or administration of the transactions contemplated by the Trust Agreement, including the reasonable costs and expenses of defending themselves against any claim or liability in connection with the exercise or performance of any of their powers or duties under the Trust Agreement; and

 

(D)                           maintain the effectiveness of all of the Issuer’s licenses required under the Pennsylvania Motor Vehicle Sales Finance Act in connection with the Indenture and the transactions contemplated thereby until the lien and security interest of the Indenture shall no longer be in effect in accordance with the terms thereof.

 

(b)                              Additional Duties.

 

(i)                               In addition to the duties set forth in Section 1(a)(i), the Administrator (A) shall perform such calculations and shall prepare or shall cause the preparation by other appropriate persons of, and shall execute on behalf of the Issuer or the Owner Trustee, all such documents, reports, filings, instruments, certificates and opinions that the Issuer or the Owner Trustee are required to prepare, file or deliver pursuant to the Transaction Documents or under Section 5.03 of the Trust Agreement, (B) shall deliver on behalf of the Issuer or the Owner Trustee, all notices required to be delivered to the Rating Agencies pursuant to the Transaction Documents and the Trust Agreement, and (C) at the request of the Owner Trustee shall take all appropriate action that the Issuer or the Owner Trustee are required to take pursuant to the Transaction Documents.  In furtherance thereof, the Owner Trustee shall, on behalf of the Issuer, execute and deliver to the Administrator and to each successor Administrator appointed pursuant to the terms hereof, one or more powers of attorney substantially in the form of Exhibit A hereto, appointing the Administrator the attorney-in-fact of the Issuer for the purpose of executing on behalf of the Owner Trustee and the Issuer all such documents, reports, filings, instruments, certificates and opinions.  Subject to Section 5, and in accordance with the directions of the Issuer, the Administrator shall administer, perform or supervise the performance of such other activities in connection with the Collateral (including the Transaction Documents) as are not covered by any 

 

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of the foregoing provisions and as are expressly requested by the Issuer and are reasonably within the capability of the Administrator.

 

(ii)                              Notwithstanding anything in this Agreement or the Transaction Documents to the contrary, the Administrator shall be responsible for promptly notifying the Owner Trustee in the event that any withholding tax is imposed on the Trust’s payments (or allocations of income) to a Certificateholder as contemplated in Section 5.01(d) of the Trust Agreement.  Any such notice shall specify the amount of any withholding tax required to be withheld by the Owner Trustee pursuant to such provision.

 

(iii)                          Notwithstanding anything in this Agreement or the Transaction Documents to the contrary, the Administrator shall be responsible for performance of the duties of the Owner Trustee set forth in Section 5.03(a), (c), (d), and (e), and the penultimate sentence of Section 5.03 of the Trust Agreement with respect to, among other things, accounting and reports to the Certificateholders; provided, however, that the Owner Trustee shall retain responsibility for the distribution of information forms necessary to enable each Certificateholder to prepare its federal and state income tax returns.

 

(iv)                          If the Administrator or any of its Affiliates is not the sole Certificateholder, the Administrator shall satisfy its obligations with respect to clauses (ii) and (iii) above by retaining, at the expense of the Trust payable by the Administrator, a firm of independent public accountants acceptable to the Owner Trustee, which shall perform the obligations of the Administrator thereunder.

 

(v)                              The Administrator shall perform the duties of the Administrator specified in Section 10.02 of the Trust Agreement required to be performed in connection with the resignation or removal of the Owner Trustee, and any other duties expressly required to be performed by the Administrator under the Trust Agreement.

 

(vi)                          In carrying out the foregoing duties or any of its other obligations under this Agreement, the Administrator may enter into transactions or otherwise deal with any of its Affiliates; provided, however, that the terms of any such transactions or dealings shall be in accordance with any directions received from the Issuer and shall be, in the Administrator’s opinion, no less favorable to the Issuer than would be available from unaffiliated parties.

 

(c)                               Non-Ministerial Matters.

 

(i)                                  With respect to matters that in the reasonable judgment of the Administrator are non-ministerial, the Administrator shall not take any action unless, within a reasonable time before the taking of such action, the Administrator shall have notified the Owner Trustee of the proposed action and the Owner Trustee shall not have withheld consent or provided an alternative direction.  For the purpose of the preceding sentence, “non-ministerial matters” shall include, without limitation:

 

(A)                           the amendment of or any supplement to the Indenture;

 

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(B)                            the initiation of any claim or lawsuit by the Issuer and the compromise of any action, claim or lawsuit brought by or against the Issuer (other than in connection with the collection of the Contracts);

 

(C)                            the amendment, change or modification of any other Transaction Documents;

 

(D)                           the appointment of successor Note Registrars, successor Paying Agents and successor Indenture Trustees pursuant to the Indenture or the appointment of successor Administrators or a successor Servicer, or the consent to the assignment by the Note Registrar, Paying Agent or Indenture Trustee of its obligations under the Indenture; and

 

(E)                             the removal of the Indenture Trustee.

 

(ii)                              Notwithstanding anything to the contrary in this Agreement, the Administrator shall not be obligated to, and shall not, (A) make any payments to the Noteholders under the Transaction Documents, (B) sell the Collateral pursuant to clause (iv) of Section 5.04 of the Indenture, (C) take any other action that the Issuer directs the Administrator not to take on its behalf or (D) take any other action which may be construed as having the effect of varying the investment of the Holders.

 

Section 2.                                        Records.   The Administrator shall maintain appropriate books of account and records relating to services performed hereunder, which books of account and records shall be accessible for inspection by the Issuer and the Owner Trustee at any time during normal business hours.

 

Section 3.                                  Compensation.  As compensation for the performance of the Administrator’s obligations under this Agreement and as reimbursement for its expenses related thereto, the Administrator shall be entitled to a monthly fee which shall be solely an obligation of the Trust Depositor and shall be in an amount as shall be agreeable to the Trust Depositor and the Administrator.

 

Section 4.                                  Additional Information to be Furnished to the Issuer.  The Administrator shall furnish to the Issuer from time to time such additional information regarding the Collateral as the Issuer shall reasonably request.

 

Section 5.                                  Independence of the Administrator.  For all purposes of this Agreement, the Administrator shall be an independent contractor and shall not be subject to the supervision of the Issuer or the Owner Trustee with respect to the manner in which it accomplishes the performance of its obligations hereunder.  Unless expressly authorized by the Issuer, the Administrator shall have no authority to act for or represent the Issuer or the Owner Trustee in any way and shall not otherwise be deemed an agent of the Issuer or the Owner Trustee.

 

Section 6.                                  No Joint Venture.  Nothing contained in this Agreement (i) shall constitute the Administrator and either of the Issuer or the Owner Trustee as members of any partnership, joint venture, association, syndicate, unincorporated business or other separate entity, (ii) shall be construed to impose any liability as such on any of them, or (iii) shall be deemed to confer on any of them any express, implied or apparent authority to incur any obligation or liability on behalf of the others.

 

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Section 7.                                  Other Activities of Administrator.  Nothing herein shall prevent the Administrator or any Affiliate from engaging in other business or, in its sole discretion, from acting in a similar capacity as an administrator for any other Person or entity even though such person or entity may engage in business activities similar to those of the Issuer, the Owner Trustee or the Indenture Trustee.

 

Section 8.                                  Term of Agreement; Resignation and Removal of Administrator.  This Agreement shall continue in force until the termination of the Issuer, upon which event this Agreement shall automatically terminate.

 

(a)                               Subject to Section 8(d) and Section 8(e), the Administrator may resign its duties hereunder by providing the Issuer with at least 60 days’ prior written notice.

 

(b)                              Subject to Section 8(d) and Section 8(e), the Issuer may remove the Administrator without cause by providing the Administrator with at least 60 days’ prior written notice.

 

(c)                               Subject to Section 8(d) and Section 8(e), at the sole option of the Issuer, the Administrator may be removed immediately upon written notice of termination from the Issuer to the Administrator if any of the following events shall occur:

 

(i)                                  the Administrator shall default in the performance of any of its duties under this Agreement and, after notice of such default, shall not cure such default within ten days (or, if such default cannot be cured in such time, shall not give within ten days such assurance of cure as shall be reasonably satisfactory to the Issuer);

 

(ii)                              a court having jurisdiction in the premises shall enter a decree or order for relief, and such decree or order shall not have been vacated within 60 days, in respect of the Administrator in any involuntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect or appoint a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for the Administrator or any substantial part of its property or order the winding-up or liquidation of its affairs; or

 

(iii)                          the Administrator shall commence a voluntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, shall consent to the entry of an order for relief in an involuntary case under any such law, or shall consent to the appointment of a receiver, liquidator, assignee, trustee, custodian, sequestrator or similar official for the Administrator or any substantial part of its property, shall consent to the taking of possession by any such official of any substantial part of its property, shall make any general assignment for the benefit of creditors or shall fail generally to pay its debts as they become due.

 

The Administrator agrees that if any of the events specified in clauses (ii) or (iii) above shall occur, it shall give written notice thereof to the Issuer and the Indenture Trustee within seven days after the occurrence of such event.

 

(d)                              No resignation or removal of the Administrator pursuant to this Section shall be effective until (i) a successor Administrator shall have been appointed by the Issuer and (ii) such 

 

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successor Administrator shall have agreed in writing to be bound by the terms of this Agreement in the same manner as the Administrator is bound hereunder.

 

(e)                               The appointment of any successor Administrator shall be effective only after the satisfaction of the Rating Agency Condition with respect to the proposed appointment.

 

(f)                                Subject to Section 8(d) and 8(e), the Administrator acknowledges that upon the appointment of a Successor Servicer pursuant to the Sale and Servicing Agreement, the Administrator shall immediately resign and such Successor Servicer shall automatically become the Administrator under this Agreement.

 

Section 9.                                  Action upon Termination, Resignation or Removal.  Promptly upon the effective date of termination of this Agreement pursuant to Section 8 or the resignation or removal of the Administrator pursuant to Section 8(a), (b), (c) or (f), the Administrator shall be entitled to be paid all fees and reimbursable expenses accruing to it to the date of such termination, resignation or removal.  The Administrator shall forthwith upon such termination pursuant to Section 8 deliver to the Issuer all property and documents of or relating to the Collateral then in the custody of the Administrator.  In the event of the resignation or removal of the Administrator pursuant to Section 8(a), (b), (c) or (f), respectively, the Administrator shall cooperate with the Issuer and take all reasonable steps requested to assist the Issuer in making an orderly transfer of the duties of the Administrator.

 

Section 10.                          Notices.   All notices, demands, certificates, requests and communications hereunder (“notices”) shall be in writing and shall be effective (a) upon receipt when sent through the U.S. mail, registered or certified mail, return receipt requested, postage prepaid, with such receipt to be effective the date of delivery indicated on the return receipt, or (b) upon receipt when sent through an overnight courier, or (c) on the date personally delivered to an Authorized Officer of the party to which sent, or (d) on the date transmitted by legible telecopier or electronic mail transmission with a confirmation of receipt, in all cases addressed to the recipient at the address for such recipient set forth in the Sale and Servicing Agreement.

 

Each party hereto may, by notice given in accordance herewith to each of the other parties hereto, designate any further or different address to which subsequent notices shall be sent.

 

Section 11.                          Amendments.  This Agreement may be amended from time to time by a written amendment duly executed and delivered by the parties hereto, with the written consent of the Owner Trustee but without the consent of the Noteholders, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or of modifying in any manner the rights of the Noteholders; provided that such amendment will not, in the Opinion of Counsel satisfactory to the Indenture Trustee, materially and adversely affect the interest of any Noteholder.  This Agreement may also be amended by the parties hereto with the written consent of the Owner Trustee and the Required Holders for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or of modifying in any manner the rights of Noteholders; provided, however, that no such amendment may (i) increase or reduce in any manner the amount of, or accelerate or delay the timing of, collections of payments on the Contracts or distributions that are required to be made for the benefit of the Noteholders or (ii) reduce the aforesaid percentage of 

 

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the holders of Notes which are required to consent to any such amendment, without the consent of the holders of all outstanding Notes.  Notwithstanding the foregoing, the Administrator may not amend this Agreement without the permission of the Trust Depositor, which permission shall not be unreasonably withheld.

 

Section 12.                          Successors and Assigns.  This Agreement may not be assigned by the Administrator unless such assignment is previously consented to in writing by the Issuer, the Indenture Trustee and the Owner Trustee and subject to the satisfaction of the Rating Agency Condition in respect thereof.  An assignment with such consent and satisfaction, if accepted by the assignee, shall bind the assignee hereunder in the same manner as the Administrator is bound hereunder.  Notwithstanding the foregoing, this Agreement may be assigned by the Administrator without the consent of the Issuer or the Owner Trustee to a corporation or other organization that is a successor (by merger, consolidation or purchase of assets) to the Administrator; provided that such successor organization executes and delivers to the Issuer, the Owner Trustee and the Indenture Trustee an agreement, in form and substance reasonably satisfactory to the Owner Trustee and the Indenture Trustee, in which such corporation or other organization agrees to be bound hereunder by the terms of said assignment in the same manner as the Administrator is bound hereunder.  Subject to the foregoing, this Agreement shall bind any successors or assigns of the parties hereto.

 

Section 13.                          Governing Law.  THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

Section 14.                          Headings.  The section and subsection headings hereof have been inserted for convenience of reference only and shall not be construed to affect the meaning, construction or effect of this Agreement.

 

Section 15.                       Counterparts.  This Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same agreement.

 

Section 16.                    Severability.  Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

 

Section 17.                          Not Applicable to Harley-Davidson Credit in Other Capacities.  Nothing in this Agreement shall affect any obligation Harley-Davidson Credit may have in any other capacity.

 

Section 18.                          Limitation of Liability of Owner Trustee and Indenture Trustee.

 

(a)                               Notwithstanding anything contained herein to the contrary, this instrument has been countersigned by Wilmington Trust, National Association, not in its individual capacity but solely in its capacity as Owner Trustee of the Issuer and in no event shall Wilmington Trust, National Association in its individual capacity or any beneficial owner of the Issuer have any liability for the representations, 

 

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warranties, covenants, agreements or other obligations of the Issuer hereunder, as to all of which recourse shall be had solely to the assets of the Issuer.  For all purposes of this Agreement, in the performance of any duties or obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and entitled to the benefits of, the terms and provisions of Articles Six, Seven and Eight of the Trust Agreement.

 

(b)                              Notwithstanding anything contained herein to the contrary, this Agreement has been countersigned by The Bank of New York Mellon Trust Company, N.A. not in its individual capacity but solely as Indenture Trustee and in no event shall The Bank of New York Mellon Trust Company, N.A. have any liability for the representations, warranties, covenants, agreements or other obligations of the Issuer hereunder or in any of the certificates, notices or agreements delivered pursuant hereto, as to all of which recourse shall be had solely to the assets of the Issuer.

 

Section 19.                          Third-party Beneficiary.  The Owner Trustee is a third-party beneficiary to this Agreement and is entitled to the rights and benefits hereunder and may enforce the provisions hereof as if it were a party hereto.

 

Section 20.                          Survivability.  The obligations of the Administrator described in Section 1(a)(ii) hereof shall survive termination of this Agreement.

 

[signature page follows]

 

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

 

	
 
    	
HARLEY-DAVIDSON   MOTORCYCLE TRUST
    
	
 
    	
2019-A
    
	
 
    	
 
    
	
 
    	
By:
    	
Wilmington   Trust, National Association,
    
	
 
    	
 
    	
not   in its individual capacity but solely
    
	
 
    	
 
    	
as   Owner Trustee
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/Cynthia   L. Major
    	
 
    
	
 
    	
 
    	
      Printed   Name: Cynthia L. Major
    
	
 
    	
 
    	
      Title:   Banking Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
HARLEY-DAVIDSON   CUSTOMER FUNDING
    
	
 
    	
CORP.,   as Trust Depositor
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/James   Darrell Thomas
    	
 
    
	
 
    	
 
    	
      Printed   Name: James Darrell Thomas
    
	
 
    	
 
    	
      Title:   Vice President, Treasurer and
    
	
 
    	
 
    	
                  Assistant   Secretary
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
THE   BANK OF NEW YORK MELLON TRUST
    
	
 
    	
COMPANY,   N.A.,
    
	
 
    	
not   in its individual capacity but solely as
    
	
 
    	
Indenture   Trustee
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/Linda   Wirfel
    	
 
    
	
 
    	
 
    	
      Printed   Name: Linda Wirfel
    
	
 
    	
 
    	
      Title:   Vice President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
HARLEY-DAVIDSON   CREDIT CORP.,
    
	
 
    	
as   Administrator
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/James   Darrell Thomas
    	
 
    
	
 
    	
 
    	
      Printed   Name: James Darrell Thomas
    
	
 
    	
 
    	
      Title:   Vice President, Treasurer and
    
	
 
    	
 
    	
                  Assistant   Secretary
    

 

Signature Page to Administration Agreement

 

 

EXHIBIT A

 

LIMITED POWER OF ATTORNEY

 

	
State of Illinois
    	
)
    
	
 
    	
 
    
	
 
    	
) SS.
    
	
 
    	
 
    
	
County of Cook
    	
)
    

 

KNOW ALL PERSONS BY THESE PRESENTS, that Wilmington Trust, National Association, a national banking association (the “Owner Trustee”), whose principal executive office is located at 1100 North Market Street, Wilmington, Delaware Attention:  Trust Administration, by and through its duly elected and authorized officer, _________________________________________, on behalf of itself and of Harley-Davidson Motorcycle Trust 2019-A (the “Issuer”), as Issuer, under the Administration Agreement, dated as of June 1, 2019 (the “Administration Agreement”), among the Issuer, Harley-Davidson Customer Funding Corp., The Bank of New York Mellon Trust Company, N.A., as Indenture Trustee, and Harley-Davidson Credit Corp., as Administrator, does hereby nominate, constitute and appoint Harley-Davidson Credit Corp., a Nevada corporation, each of its officers from time to time and each of its employees authorized by it from time to time to act hereunder, jointly and each of them severally, together or acting alone, its true and lawful attorney-in-fact, for the Owner Trustee and the Issuer in their name, place and stead, in the sole discretion of such attorney-in-fact, to perform such calculations and prepare or cause the preparation by other appropriate persons of, and to execute on behalf of the Issuer or the Owner Trustee, all such documents, reports, filings, instruments, certificates and opinions that the Issuer or the Owner Trustee is required to prepare, file or deliver pursuant to the Administration Agreement, and to take any and all other action, as such attorney-in-fact may deem necessary or desirable in accordance with the directions of the Owner Trustee and in connection with its duties as Administrator or successor Administrator under the Administration Agreement.  Capitalized terms used herein that are not otherwise defined shall have the meanings ascribed thereto in the Administration Agreement.

 

The Owner Trustee hereby ratifies and confirms the execution, delivery and performance (whether before or after the date hereof) of the above-mentioned documents, reports, filings, instruments, certificates and opinions, by the attorney-in-fact and all that the attorney-in-fact shall lawfully do or cause to be done by virtue hereof.

 

The Owner Trustee hereby agrees that no person or other entity dealing with the attorney-in-fact shall be bound to inquire into such attorney-in-fact’s power and authority hereunder and any such person or entity shall be fully protected in relying on such power of authority.

 

This Limited Power of Attorney may not be assigned without the prior written consent of the Owner Trustee.  It is effective immediately and will continue until it is revoked.

 

 

This Limited Power of Attorney shall be governed and construed in accordance with the laws of the State of Illinois without reference to principles of conflicts of law.

 

Executed as of this 1st day of June, 2019.

 

 

 

	
 
    	
WILMINGTON TRUST, NATIONAL ASSOCIATION,
   not in its individual capacity but solely as Owner Trustee
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
Printed Name:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Title:
    

 

 

CERTIFICATE OF ACKNOWLEDGMENT OF

 

NOTARY PUBLIC

 

	
State of Delaware
    	
)
    
	
 
    	
 
    
	
 
    	
)  SS.
    
	
 
    	
 
    
	
County of New Castle
    	
)
    

 

On _______ __, 2019 before me,___________________________________________________

 

[Insert name and title of notary]

 

personally appeared _______________________________________

 

o                                   personally known to me, or

 

o                                   proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are

 

subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ties), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which person(s) acted, executed the instrument.

 

	
 
    	
WITNESS my hand and official seal.
    

 

 

 

	
 
    	
Signature:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Notary Public, State of Delaware
    	
 
    	
 
    
	
 
    	
 
    	
My Commission Expires
    	
[SEAL]Exhibit 10.1

 

SINA CORPORATION
 2019 SHARE INCENTIVE PLAN

 

 

Table of Content

 

	
Section
    	
 
    	
Page No.
    
	
 
    	
 
    
	
SECTION 1.   INTRODUCTION
    	
1
    
	
SECTION 2.   DEFINITIONS
    	
1
    
	
SECTION 3.   ADMINISTRATION
    	
6
    
	
(a)
    	
Committee Composition
    	
6
    
	
(b)
    	
Authority of the   Committee
    	
6
    
	
(c)
    	
Indemnification
    	
7
    
	
SECTION 4.   GENERAL
    	
7
    
	
(a)
    	
General Eligibility
    	
7
    
	
(b)
    	
Incentive Share Options
    	
8
    
	
(c)
    	
Restrictions on Shares
    	
8
    
	
(d)
    	
Beneficiaries
    	
8
    
	
(e)
    	
No Rights as a Shareholder
    	
8
    
	
(f)
    	
Termination of Service
    	
8
    
	
SECTION 5.   SHARES SUBJECT TO PLAN AND SHARE LIMITS
    	
9
    
	
(a)
    	
Basic Limitation
    	
9
    
	
(b)
    	
Limits on Awards
    	
9
    
	
(c)
    	
Limits on Incentive   Stock Options
    	
9
    
	
(d)
    	
Share Count
    	
9
    
	
(e)
    	
Dividend Equivalents
    	
9
    
	
SECTION 6.   TERMS AND CONDITIONS OF OPTIONS
    	
9
    
	
(a)
    	
Share Option Agreement
    	
9
    
	
(b)
    	
Number of Shares
    	
9
    
	
(c)
    	
Exercise Price
    	
10
    
	
(d)
    	
Exercisability and Term
    	
10
    
	
(e)
    	
Method of Exercise
    	
10
    
	
(f)
    	
Payment for Option   Shares
    	
10
    
	
(g)
    	
Modifications or   Assumption of Options
    	
10
    
	
(h)
    	
Assignment or Transfer   of Options
    	
11
    
	
(i)
    	
Incentive Share Options
    	
11
    
	
SECTION 7.   TERMS AND CONDITIONS OF SHARE APPRECIATION RIGHTS
    	
12
    
	
(a)
    	
SAR Agreement
    	
12
    
	
(b)
    	
Number of Shares
    	
12
    
	
(c)
    	
Exercise Price
    	
12
    
	
(d)
    	
Exercisability and Term
    	
12
    
	
(e)
    	
Exercise of SARs
    	
12
    
	
(f)
    	
Modification or   Assumption of SARs
    	
12
    
	
(g)
    	
Assignment or Transfer   of SARs
    	
13
    
	
SECTION 8.   TERMS AND CONDITIONS FOR SHARE GRANTS
    	
13
    
	
(a)
    	
Time, Amount and   Form of Awards
    	
13
    
	
(b)
    	
Share Grant Agreement
    	
13
    
	
(c)
    	
Payment for Share   Grants
    	
13
    
	
(d)
    	
Vesting Conditions
    	
13
    
	
(e)
    	
Assignment or Transfer   of Share Grants
    	
13
    
				

 

i

 

	
(f)
    	
Voting and Dividend   Rights
    	
13
    
	
(g)
    	
Modification or   Assumption of Share Grants
    	
14
    
	
SECTION 9.   TERMS AND CONDITIONS OF RESTRICTED SHARE UNITS
    	
14
    
	
(a)
    	
Restricted Share Unit   Agreement
    	
14
    
	
(b)
    	
Number of Shares
    	
14
    
	
(c)
    	
Payment for Restricted   Share Units
    	
14
    
	
(d)
    	
Vesting Conditions
    	
14
    
	
(e)
    	
Form and Time of   Settlement of Restricted Share Units
    	
14
    
	
(f)
    	
Voting and Dividend   Rights
    	
14
    
	
(g)
    	
Creditors’ Rights
    	
15
    
	
(h)
    	
Modification or   Assumption of Restricted Share Units
    	
15
    
	
(i)
    	
Assignment or Transfer   of Restricted Share Units
    	
15
    
	
SECTION 10.   PROTECTION AGAINST DILUTION
    	
15
    
	
(a)
    	
Adjustments
    	
15
    
	
(b)
    	
Participant Rights
    	
15
    
	
(c)
    	
Fractional Shares
    	
16
    
	
SECTION 11.   EFFECT OF A CHANGE IN CONTROL
    	
16
    
	
(a)
    	
Change in Control
    	
16
    
	
(b)
    	
Acceleration
    	
16
    
	
(c)
    	
Dissolution
    	
16
    
	
SECTION 12.   LIMITATIONS ON RIGHTS
    	
16
    
	
(a)
    	
Participant Rights
    	
16
    
	
(b)
    	
Shareholders’ Rights
    	
17
    
	
(c)
    	
Regulatory Requirements
    	
17
    
	
SECTION 13.   WITHHOLDING TAXES
    	
17
    
	
(a)
    	
General
    	
17
    
	
(b)
    	
Share Withholding
    	
17
    
	
SECTION 14.   DURATION AND AMENDMENTS
    	
18
    
	
(a)
    	
Term of the Plan
    	
18
    
	
(b)
    	
Right to Amend or   Terminate the Plan
    	
18
    

 

ii

 

SINA CORPORATION
 2019 SHARE INCENTIVE PLAN

 

SECTION 1. INTRODUCTION.

 

On              , 2019, the Board adopted this 2019 Share Incentive Plan which has become effective upon the date of its adoption by the Board (the “Effective Date”).

 

The purpose of this Plan is to promote the long-term success of the Company and the creation of shareholder value by offering Participants the opportunity to share in such long-term success by acquiring a proprietary interest in the Company.

 

The Plan seeks to achieve this purpose by providing for discretionary long-term incentive Awards in the form of Options (which may be Incentive Share Options or Nonstatutory Share Options), Share Appreciation Rights, Share Grants and Restricted Share Units.

 

The Plan shall be governed by, and construed in accordance with, the laws of the Cayman Islands. Capitalized terms shall have the meaning provided in Section 2 unless otherwise provided in this Plan or any related Award Agreement.

 

SECTION 2. DEFINITIONS.

 

(a)                                 “Affiliate” means any entity other than a Subsidiary, if the Company and/or one or more Subsidiaries own not less than 50% of such entity.

 

(b)                                 “Annual Pool” has the meaning set forth in Section 5(b).

 

(c)                                  “Applicable Laws” means all applicable laws, rules, regulations and requirements relating to the administration of share plans, including, but not limited to, all applicable Cayman laws, the laws of the People’s Republic of China, U.S. federal and state laws, the rules and regulations of any stock exchange or quotation system on which the Ordinary Shares are listed or quoted, and the applicable laws, rules, regulations or requirements of any foreign country or jurisdiction where Awards are, or will be, granted under the Plan or where Participants reside or provide services, as such laws, rules, regulations and requirements shall be in place from time to time.

 

(d)                                 “Award” means an Option, SAR, Share Grant or Restricted Share Unit.

 

(e)                                  “Award Agreement” means any Share Option Agreement, SAR Agreement, Share Grant Agreement or Restricted Share Unit Agreement.

 

(f)                                   “Board” means the board of directors of the Company, as constituted from time to time.

 

(g)                                  “Cashless Exercise” means, to the extent that a Share Option Agreement so provides and as permitted by Applicable Laws, a program approved by the Committee in which payment of the aggregate Exercise Price and/or satisfaction of any applicable tax withholding obligations may be made all or in part by delivery (on a form prescribed by the Committee) of an irrevocable direction to a securities broker to sell Shares subject to an Option and to deliver all or part of the sale proceeds to the Company.

 

 

(h)                                 “Cause” means, except as may otherwise be provided in a Participant’s employment agreement, Award Agreement, or other written agreement, (i) Participant’s willful failure to perform his or her duties and responsibilities to the Company or material violation of a written Company policy; (ii) Participant’s commission of any act of fraud, embezzlement, dishonesty or any other willful misconduct that has caused or is reasonably expected to result in material injury to the Company; (iii) unauthorized use or disclosure by Participant of any proprietary information or trade secrets of the Company or any other party to whom the Participant owes an obligation of nondisclosure as a result of his or her relationship with the Company; or (iv) Participant’s willful breach of any of his or her obligations under any written agreement or covenant with the Company. The determination as to whether a Participant is being terminated for Cause shall be made in good faith by the Committee and shall be conclusive and binding on the Participant. The foregoing definition does not in any way limit the Company’s ability to terminate a Participant’s Service at any time as provided in Section 12(a), and the term “Company” will be interpreted to include any Subsidiary, Parent, Affiliate, or any successor thereto, if appropriate.

 

(i)                                     “Change in Control” means the consummation of any of the following transactions:

 

(i)                                     The sale of all or substantially all of the Company’s assets;

 

(ii)                                  The merger of the Company with or into another corporation in which securities possessing more than 50% of the total combined voting power of the Company are transferred to a person or persons different from the persons holding those securities immediately prior to such transaction; or

 

(iii)                               The acquisition, directly or indirectly, by any person or related group of persons (other than the Company or a person that directly or indirectly controls, is controlled by, or is under common control with, the Company) of beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of securities of the Company representing more than 50% of the total combined voting power of the Company’s then outstanding securities. For purposes of this paragraph, the term “person” shall not include: (1) a trustee of other fiduciary holding securities under an employee benefit plan of the Company, a Subsidiary or an Affiliate; or (2) corporation or other entity owned directly or indirectly by the shareholders of the Company in substantially the same proportions as their ownership of the Ordinary Shares.

 

A transaction shall not constitute a Change in Control if its sole purpose is to change the place of the Company’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transactions.

 

2

 

(j)                                    “Code” means the Internal Revenue Code of 1986, as amended, and the regulations and interpretations promulgated thereunder.

 

(k)                                 “Committee” means the compensation committee of the Board and/or any other committee appointed by the Board as described in Section 3(a).

 

(l)                                     “Company” means Sina Corporation, a Cayman Islands corporation.

 

(m)                             “Consultant” means an individual who provides bona fide services to the Company, a Parent, a Subsidiary or an Affiliate, other than as an Employee, Director or Non-Employee Director.

 

(n)                                 “Director” means a member of the Board who is also an Employee.

 

(o)                                 “Disability” means that the Participant is classified as disabled under the long-term disability policy of the Company or, if no such policy applies, the Participant is unable 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.

 

(p)                                 “Employee” means any individual who is an employee of the Company, a Parent, a Subsidiary or an Affiliate.

 

(q)                                 “Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

(r)                                    “Exercise Price” means, in the case of an Option, the amount for which a Share may be purchased upon exercise of such Option, as specified in the applicable Share Option Agreement. “Exercise Price,” in the case of a SAR, means an amount, as specified in the applicable SAR Agreement, which is subtracted from the Fair Market Value in determining the amount payable upon exercise of such SAR.

 

(s)                                   “Fair Market Value” means the market price of a Share as determined in good faith by the Committee. Such determination shall be conclusive and binding on all persons. The Fair Market Value shall be determined by the following:

 

(i)                                     if the Shares are admitted to trading on any established national stock exchange or market system, including without limitation NASDAQ, on the date in question, then the Fair Market Value shall be equal to the closing sales price for such Shares as quoted on such national exchange or system on such date; or

 

(ii)                                  if the Shares are admitted to quotation on NASDAQ or are regularly quoted by a recognized securities dealer but selling prices are not reported on the date in question, then the Fair Market Value shall be equal to the mean between the bid and asked prices of the Shares reported for such date.

 

3

 

In each case, the applicable price shall be the price reported in such source as the Committee deems reliable; provided, however, that if there is no such reported price for the Shares for the date in question, then the Fair Market Value shall be equal to the price reported on the last preceding date for which such price exists. If neither (i) or (ii) are applicable, then the Fair Market Value shall be determined by the Committee in good faith on such basis as it deems appropriate.

 

(t)                                    “Fiscal Year” means the Company’s fiscal year.

 

(u)                                 “Grant Date” means the grant effective date of an Award.

 

(v)                                 “Incentive Share Option” or “ISO” means an incentive stock option described in Code Section 422.

 

(w)                               “Non-Employee Director” means a member of the Board who is not an Employee.

 

(x)                                 “Nonstatutory Share Option” or “NSO” means a share option that is not an ISO.

 

(y)                                 “Option” means an ISO or NSO granted under the Plan entitling the Optionee to purchase Shares.

 

(z)                                  “Optionee” means an individual, estate or other entity that holds an Option.

 

(aa)                          “Ordinary Shares” means the Company’s ordinary shares.

 

(bb)                          “Parent” means any corporation (other than the Company) in an unbroken chain of corporations ending with the Company, if each of the corporations other than the Company owns share possessing 50% or more of the total combined voting power of all classes of shares in one of the other corporations in such chain. A corporation that attains the status of a Parent on a date after the adoption of the Plan shall be considered a Parent commencing as of such date.

 

(cc)                            “Participant” means an Employee, Director, Non-Employee Director or Consultant who has been selected by the Committee to receive an Award under the Plan or any individual, estate or other entity that holds an Award.

 

(dd)                          “Performance Goals” means one or more objective measurable performance goals established by the Committee with respect to a Performance Period based upon one or more factors, including: (i) operating income; (ii) earnings before interest, taxes, depreciation and amortization; (iii) earnings; (iv) cash flow; (v) market share; (vi) sales or revenue; (vii) expenses; (viii) cost of goods sold; (ix) profit/loss or profit margin; (x) working capital; (xi) return on equity or assets; (xii) earnings per share; (xiii) economic value added; (xiv) price/earnings ratio; (xv) debt or debt-to-equity; (xvi) accounts receivable; (xvii) writeoffs; (xviii) cash; (xix) assets; (xx) liquidity; (xxi) operations; (xxii) intellectual property (e.g., patents); (xxiii) product development; (xxiv) regulatory activity; (xxv) manufacturing, production or inventory; (xxvi) mergers and acquisitions or divestitures; and/or (xxvii) financings, each with respect to the Company and/or one or more of its Parent, Subsidiaries, Affiliates or operating units.

 

4

 

(ee)                            “Performance Period” means any period not exceeding 60 months as determined by the Committee, in its sole discretion. The Committee may establish different Performance Periods for different Participants, and the Committee may establish concurrent or overlapping Performance Periods.

 

(ff)                              “Plan” means this Sina Corporation 2019 Share Incentive Plan as it may be amended from time to time.

 

(gg)                            “Restricted Share Unit” means a bookkeeping entry representing the equivalent of one Share awarded under the Plan.

 

(hh)                          “Restricted Share Unit Agreement” means the agreement described in Section 9 evidencing a Restricted Share Unit.

 

(ii)                                  “SAR Agreement” means the agreement described in Section 7 evidencing a Share Appreciation Right.

 

(jj)                                “SEC” means the Securities and Exchange Commission.

 

(kk)                          “Section 16 Persons” means those officers, directors or other persons who are subject to Section 16 of the Exchange Act.

 

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

 

(mm)                  “Service” means service as an Employee, Director, Non-Employee Director or Consultant. A Participant’s Service does not terminate if he or she is an Employee and goes on a bona fide leave of absence that was approved by the Company in writing and the terms of the leave provide for continued service crediting, or when continued service crediting is required by Applicable Laws. However, for purposes of determining whether an Option is entitled to continuing ISO status, an Employee’s Service will be treated as terminating 90 days after such Employee went on leave, unless such Employee’s right to return to active work is guaranteed by law or by a contract. Service terminates in any event when the approved leave ends, unless such Employee immediately returns to active work. Further, unless otherwise determined by the Committee, a Participant’s Service will not terminate merely because of a change in the capacity in which the Participant provides service to the Company, a Parent, Subsidiary or Affiliate, or a transfer between entities (the Company or any Parent, Subsidiary, or Affiliate); provided that there is no interruption or other termination of Service.

 

(nn)                          “Share” means one share of Ordinary Shares.

 

(oo)                          “Share Appreciation Right” or “SAR” means a share appreciation right awarded under the Plan.

 

(pp)                          “Share Grant” means Shares awarded under the Plan.

 

(qq)                          “Share Grant Agreement” means the agreement described in Section 8 evidencing a Share Grant.

 

5

 

(rr)                                “Share Option Agreement” means the agreement described in Section 6 evidencing an Option.

 

(ss)                              “Subsidiary” means any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company, if each of the corporations other than the last corporation in the unbroken chain owns shares possessing 50% or more of the total combined voting power of all classes of shares in one of the other corporations in such chain. A corporation that attains the status of a Subsidiary on a date after the adoption of the Plan shall be considered a Subsidiary commencing as of such date.

 

(tt)                                “10-Percent Shareholder” means an individual who owns more than 10% of the total combined voting power of all classes of outstanding shares of the Company, its Parent or any of its Subsidiaries. In determining share ownership, the attribution rules of Code Section 424(d) shall be applied.

 

SECTION 3. ADMINISTRATION.

 

(a)                     Committee Composition. The Board or the Committee shall administer the Plan. The Committee shall generally have membership composition which enables Awards to Section 16 Persons to qualify as exempt from liability under Section 16(b) of the Exchange Act. However, the Board may also appoint one or more separate Committees, each composed of one or more directors of the Company who need not qualify under Rule 16b-3, that may administer the Plan with respect to Participants who are not Section 16 Persons, respectively, may grant Awards under the Plan to such Participants and may determine all terms of such Awards. Members of any such Committee shall serve for such period of time as the Board may determine and shall be subject to removal by the Board at any time. The Board may also at any time terminate the functions of the Committee and reassume all powers and authority previously delegated to the Committee.

 

Notwithstanding the foregoing, the Board shall administer the Plan with respect to all Awards granted to Non-Employee Directors.

 

The Board and any Committee appointed to administer the plan is collectively referred to hereinafter as the “Committee”.

 

(b)                     Authority of the Committee. Subject to the provisions of the Plan, the Committee shall have the full authority, in its sole discretion, to take any actions it deems necessary or advisable for the administration of the Plan. Such actions shall include:

 

(i)                                     selecting Participants who are to receive Awards under the Plan;

 

(ii)                                  determining the Fair Market Value;

 

(iii)                               determining the type, number, Grant Date, vesting requirements and other features and conditions of such Awards;

 

(iv)                              approving the forms of agreements to be used under the Plan;

 

6

 

(v)                                 amending any outstanding Awards;

 

(vi)                              accelerating the vesting, or extending the post-termination exercise term, of Awards at any time and under such terms and conditions as it deems appropriate;

 

(vii)                           interpreting the Plan and any Award Agreement;

 

(viii)                        correcting any defect, supplying any omission or reconciling any inconsistency in the Plan or any Award Agreement;

 

(ix)                              adopting such rules or guidelines as it deems appropriate to implement the Plan;

 

(x)                                 authorizing any person to execute on behalf of the Company any instrument required to effect the grant of an Award previously authorized by the Committee;

 

(xi)                              making all other decisions relating to the operation of the Plan; and

 

(xii)                           adopting such plans or subplans as may be deemed necessary or appropriate to comply with the laws of certain countries, allow for tax-preferred treatment of the Awards or otherwise provide for the participation by Participants who reside in such countries.

 

The Committee’s determinations under the Plan shall be final and binding on all persons.

 

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

 

SECTION 4. GENERAL.

 

(a)                     General Eligibility. Only Employees, Directors, Non-Employee Directors and Consultants shall be eligible to participate in the Plan.

 

7

 

(b)                     Incentive Share Options. Only Participants who are Employees of the Company, a Parent or a Subsidiary shall be eligible for the grant of ISOs. In addition, a Participant who is a 10-Percent Shareholder shall not be eligible for the grant of an ISO unless the requirements set forth in Code Section 422(c)(5) are satisfied.

 

(c)                      Restrictions on Shares. Any Shares issued pursuant to an Award shall be subject to such rights of repurchase, rights of first refusal and other transfer restrictions as the Committee may determine, in its sole discretion. Such restrictions shall apply in addition to any restrictions that may apply to holders of Shares generally and shall also comply to the extent necessary with Applicable Laws. In no event shall the Company be required to issue fractional Shares under this Plan.

 

(d)                     Beneficiaries. Unless stated otherwise in an Award Agreement and then only to the extent permitted by and enforceable under Applicable Laws, a Participant may designate one or more beneficiaries with respect to an Award by timely filing the prescribed form with the Company or the Company’s designee. A beneficiary designation may be changed by filing the prescribed form with the Company (or the Company’s designee) at any time before the Participant’s death. If no beneficiary was designated or if no designated beneficiary survives the Participant, then after a Participant’s death any vested Award(s) shall be transferred or distributed to the Participant’s estate or to such other person as the Company may designate.

 

(e)                      No Rights as a Shareholder. A Participant, or a transferee of a Participant, shall have no rights as a shareholder with respect to any Ordinary Shares covered by an Award until such person has satisfied all of the terms and conditions to receive such Ordinary Shares, has satisfied any applicable withholding or tax obligations relating to the Award and the Shares have been issued (as evidenced by an appropriate entry on the books of the Company or a duly authorized transfer agent of the Company).

 

(f)                       Termination of Service. Unless the applicable Award Agreement or, with respect to a Participant who resides in the U.S., the applicable employment agreement provides otherwise, the following rules shall govern the vesting, exercisability and term of outstanding Awards held by a Participant in the event of termination of such Participant’s Service (in all cases subject to the maximum term of the Option and/or SAR as applicable): (i) upon termination of Service for any reason, the unvested portions of any outstanding Restricted Share Units or Share Grants shall be immediately forfeited without consideration; (ii) if Service is terminated for Cause, then all unexercised Options and/or SARs, unvested portions of Restricted Share Units and unvested portions of Share Grants shall terminate and be forfeited immediately without consideration; (iii) if Service is terminated for any reason other than for Cause, death or Disability, then the vested portion of the Participant’s then-outstanding Options and/or SARs may be exercised by such Participant or his or her personal representative within ninety (90) days after the date of such termination and the unvested portions of any such Awards shall be forfeited without consideration at the end of such period; or (iv) if Service is terminated due to death or Disability, the vested portion of the Participant’s then-outstanding Options and/or SARs may be exercised within six (6) months after the date of such termination and the unvested portions of any such Awards shall be forfeited without consideration at the end of such period.

 

8

 

SECTION 5. SHARES SUBJECT TO PLAN AND SHARE LIMITS.

 

(a)                     Basic Limitation. The shares issuable under the Plan shall be authorized, but unissued, or reacquired Shares. The aggregate number of Shares reserved for Awards under the Plan is 3,477,643 Shares, subject to adjustment pursuant to Section 10.

 

(b)                     Limits on Awards.The aggregate maximum number of Shares that may be granted in connection with all Awards during any Fiscal Year shall not exceed three percent (3%) of the total number of the Company’s outstanding Shares as of the last day of the immediately preceding Fiscal Year (“Annual Pool”), plus any Shares remaining available pursuant to the Annual Pool for the immediately preceding Fiscal Year, subject to adjustment pursuant to Section 10.

 

(c)                      Limits on Incentive Stock Options. The aggregate maximum number of Shares that may be issued in connection with ISOs shall be 3,477,643 Shares, subject to adjustment pursuant to Section 10.

 

(d)                     Share Count. Shares issued as Share Grants, or pursuant to Restricted Share Units, Options or Share Appreciation Rights will count against the Shares available for issuance under the Plan, and against the Shares available for grant during any Fiscal Year, as one (1) Share for every one (1) Share subject thereto. The total number of Shares subject to Share Appreciation Rights that are settled in Shares shall be counted in full against the number of Shares available for issuance under the Plan, regardless of the number of Shares actually issued upon settlement of the Share Appreciation Rights. If Awards are settled in cash, the Shares that would have been delivered had there been no cash settlement shall not be counted against the Shares available for issuance under the Plan. If Awards are forfeited or are terminated for any reason before vesting or being exercised, then the Shares underlying such Awards shall again become available for Awards under the Plan. For purposes of clarity, no Shares surrendered pursuant to Section 6(f)(i) and no Shares withheld pursuant to Section 13(b) shall again become available for Awards under the Plan.

 

(e)                      Dividend Equivalents. Any dividend equivalents distributed under the Plan shall reduce the number of Shares available for Awards.

 

SECTION 6. TERMS AND CONDITIONS OF OPTIONS.

 

(a)                     Share Option Agreement. Each Option granted under the Plan shall be evidenced and governed exclusively by a Share Option Agreement between the Optionee and the Company. Such Option shall be subject to all applicable terms and conditions of the Plan and may be subject to any other terms and conditions that are not inconsistent with the Plan and that the Committee deems appropriate for inclusion in a Share Option Agreement. The provisions of the various Share Option Agreements entered into under the Plan need not be identical. The Share Option Agreement shall specify whether the Option is an ISO or an NSO.

 

(b)                     Number of Shares. Each Share Option Agreement shall specify the number of Shares that are subject to the Option, which number is subject to adjustment in accordance with Section 10.

 

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(c)                      Exercise Price. Each Share Option Agreement shall specify the Option’s Exercise Price which shall be established by the Committee and is subject to adjustment in accordance with Section 10. The Exercise Price per Share subject to an Option may be adjusted in the absolute discretion of the Committee, the determination of which shall be final, binding and conclusive.

 

(d)                     Exercisability and Term. Each Share Option Agreement shall specify the date when all or any installment of the Option is to become exercisable and may include performance conditions or Performance Goals. The Share Option Agreement shall also specify the maximum term of the Option; provided that the maximum term of an Option shall in no event exceed seven (7) years from the Grant Date. A Share Option Agreement may provide for accelerated vesting in the event of the Participant’s death, Disability or other events. Notwithstanding any other provision of the Plan or the Share Option Agreement, no Option can be exercised after the expiration date provided in the applicable Share Option Agreement.

 

(e)                      Method of Exercise. An Option may be exercised, in whole or in part, by giving written notice of exercise to the Company (or, subject to Applicable Laws and if the Company permits, by electronic or voice methods) of the number of Shares to be purchased. Such notice shall be accompanied by payment in full of the aggregate Exercise Price, plus any required withholdings (unless satisfactory arrangements have been made to satisfy such withholdings). The Company reserves the right to delay issuance of the Shares if such payments are not satisfactory.

 

(f)                       Payment for Option Shares. The Exercise Price of an Option shall be paid in cash at the time of exercise, except as follows and if so provided for in the applicable Share Option Agreement:

 

(i)                                     Surrender of Share. Payment of all or a part of the Exercise Price may be made with Shares which have already been owned by the Optionee; provided that the Committee may, in its sole discretion, require that Shares tendered for payment be previously held by the Optionee for a minimum duration (e.g., to avoid financial accounting charges to the Company’s earnings).

 

(ii)                                  Cashless Exercise. Payment of all or a part of the Exercise Price may be made through Cashless Exercise.

 

(iii)                               Other Forms of Payment. Payment may be made in any other form that is consistent with Applicable Laws, regulations and rules and approved by the Committee.

 

In the case of an ISO granted under the Plan, except to the extent permitted by Applicable Laws, payment shall be made only pursuant to the express provisions of the applicable Share Option Agreement. In the case of an NSO granted under the Plan, the Committee may, in its discretion at any time, accept payment in any form(s) described in this Section 6(f).

 

(g)                      Modifications or Assumption of Options. Within the limitations of the Plan, the Committee may modify, extend or assume outstanding options or may accept the cancellation of outstanding options (whether granted by the Company or by another issuer) in return for the grant of new Options for the same or a different number of Shares and at the same or a different Exercise Price. Notwithstanding the preceding sentence or anything to the contrary, no modification of an Option shall, without the consent of the Optionee, impair his or her rights or obligations under such Option.

 

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(h)                     Assignment or Transfer of Options. Except as otherwise provided in the applicable Share Option Agreement and then only to the extent such transfer is otherwise permitted by Applicable Laws, no Option or interest therein shall be transferred, assigned, pledged or hypothecated by the Optionee during his or her lifetime, whether by operation of law or otherwise, or be made subject to execution, attachment or similar process, other than by will or by the laws of descent and distribution and an Option may be exercised during the lifetime of the Optionee only or by the guardian or legal representative of the Optionee.

 

(i)                         Incentive Share Options. ISOs may be granted to Employees of the Company, a Parent or Subsidiary of the Company.  ISOs may not be granted to Non-Employee Directors or Consultants.  The terms of any ISO granted pursuant to the Plan, in addition to the requirements of Section 6(a) to Section 6(h), must comply with the following additional provisions:

 

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

 

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

 

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

 

(iv)                              Expiration of Incentive Share Options.  No Award of an ISO may be made pursuant to this Plan after the seventh anniversary of the Effective Date.

 

(v)                                 Right to Exercise.  During a Participant’s lifetime, an ISO may be exercised only by the Participant.

 

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SECTION 7. TERMS AND CONDITIONS OF SHARE APPRECIATION RIGHTS.

 

(a)                     SAR Agreement. Each SAR granted under the Plan shall be evidenced by a SAR Agreement between the Participant and the Company. Such SAR shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. A SAR Agreement may provide for a maximum limit on the amount of any payout notwithstanding the Fair Market Value on the date of exercise of the SAR. The provisions of the various SAR Agreements entered into under the Plan need not be identical. SARs may be granted in consideration of a reduction in the Participant’s compensation.

 

(b)                     Number of Shares. Each SAR Agreement shall specify the number of Shares to which the SAR pertains, which number is subject to adjustment in accordance with Section 10.

 

(c)                      Exercise Price. Each SAR Agreement shall specify the Exercise Price, which is subject to adjustment in accordance with Section 10. A SAR Agreement may specify an Exercise Price that varies in accordance with a predetermined formula while the SAR is outstanding. The Exercise Price may be adjusted in the absolute discretion of the Committee, the determination of which shall be final, binding and conclusive.

 

(d)                     Exercisability and Term. Each SAR Agreement shall specify the date when all or any installment of the SAR is to become exercisable and may include performance conditions or Performance Goals. The SAR Agreement shall also specify the maximum term of the SAR which shall not exceed seven (7) years from the Grant Date. A SAR Agreement may provide for accelerated exercisability in the event of the Participant’s death, Disability or other events. SARs may be awarded in combination with Options or Share Grants, and such an Award shall provide that the SARs will not be exercisable unless the related Options or Share Grants are forfeited. A SAR may be included in an ISO only at the time of grant but may be included in an NSO at the time of grant or at any subsequent time, but not later than six (6) months before the expiration of such NSO. Notwithstanding any other provision of the Plan or the SAR Agreement, no SAR can be exercised after the expiration date provided in the applicable SAR Agreement.

 

(e)                      Exercise of SARs. Upon exercise of a SAR, the Participant (or any person having the right to exercise the SAR after Participant’s death) shall receive from the Company (i) Shares, (ii) cash or (iii) any combination of Shares and cash, as the Committee shall determine at the time of grant of the SAR, in its sole discretion. The amount of cash and/or the Fair Market Value of Shares received upon exercise of SARs shall, in the aggregate, be equal to the amount by which the Fair Market Value (on the date of surrender) of the Shares subject to the SARs exceeds the Exercise Price of the Shares.

 

(f)                       Modification or Assumption of SARs. Within the limitations of the Plan, the Committee may modify, extend or assume outstanding SARs or may accept the cancellation of outstanding SARs (including share appreciation rights granted by another issuer) in return for the grant of new SARs for the same or a different number of Shares and at the same or a different Exercise Price. Notwithstanding the preceding sentence or anything to the contrary, no modification of an SAR shall, without the consent of the Participant, impair his or her rights or obligations under such SAR.

 

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(g)                      Assignment or Transfer of SARs. Except as otherwise provided in the applicable SAR Agreement and then only to the extent such transfer is otherwise permitted by Applicable Laws, no SAR or interest therein shall be transferred, assigned, pledged or hypothecated by the Participant during his or her lifetime, whether by operation of law or otherwise, or be made subject to execution, attachment or similar process, other than by will or by the laws of descent and distribution and a SAR may be exercised during the lifetime of the Participant only or by the guardian or legal representative of the Participant.

 

SECTION 8. TERMS AND CONDITIONS FOR SHARE GRANTS.

 

(a)                     Time, Amount and Form of Awards. Awards under this Section 8 may be granted in the form of a Share Grant. A Share Grant may be awarded in combination with NSOs, and such an Award may provide that the Share Grant will be forfeited in the event that the related NSOs are exercised.

 

(b)                     Share Grant Agreement. Each Share Grant awarded under the Plan shall be evidenced and governed exclusively by a Share Grant Agreement between the Participant and the Company. Each Share Grant shall be subject to all applicable terms and conditions of the Plan and may be subject to any other terms and conditions that are not inconsistent with the Plan that the Committee deems appropriate for inclusion in the applicable Share Grant Agreement. The provisions of the Share Grant Agreements entered into under the Plan need not be identical.

 

(c)                      Payment for Share Grants. Share Grants may be issued with or without cash consideration under the Plan.

 

(d)                     Vesting Conditions. The Committee shall determine the vesting schedule of each Share Grant. Vesting shall occur, in full or in installments, upon satisfaction of the conditions specified in the Share Grant Agreement which may include performance conditions or Performance Goals. A Share Grant Agreement may provide for accelerated vesting in the event of the Participant’s death, Disability, or other events.

 

(e)                      Assignment or Transfer of Share Grants. Except as otherwise provided in the applicable Share Grant Agreement and then only to the extent such transfer is otherwise permitted by Applicable Laws, no unvested Share Grant or interest therein shall be transferred, assigned, pledged or hypothecated by the Participant during his or her lifetime, whether by operation of law or otherwise, or be made subject to execution, attachment or similar process, other than by will or by the laws of descent and distribution.

 

(f)                       Voting and Dividend Rights. The holder of a Share Grant awarded under the Plan shall have the same voting, dividend and other rights as the Company’s other shareholders. A Share Grant Agreement may require that the holder of such Share Grant invest any cash dividends received in additional Shares subject to the Share Grant. Such additional Shares and any Shares received as a dividend pursuant to the Share Grant shall be subject to the same conditions and restrictions as the Share Grant with respect to which the dividends were paid. Such additional Shares subject to the Share Grant shall not reduce the number of Shares available for issuance under Section 5.

 

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(g)                      Modification or Assumption of Share Grants. Within the limitations of the Plan, the Committee may modify or assume outstanding Share Grants or may accept the cancellation of outstanding share grants (including share granted by another issuer) in return for the grant of new Share Grants for the same or a different number of Shares. Notwithstanding the preceding sentence or anything to the contrary, no modification of a Share Grant shall, without the consent of the Participant, impair his or her rights or obligations under such Share Grant.

 

SECTION 9. TERMS AND CONDITIONS OF RESTRICTED SHARE UNITS.

 

(a)                     Restricted Share Unit Agreement. Each Restricted Share Unit granted under the Plan shall be evidenced by a Restricted Share Unit Agreement between the Participant and the Company. Such Restricted Share Units shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various Restricted Share Unit Agreements entered into under the Plan need not be identical. Restricted Share Units may be granted in consideration of a reduction in the Participant’s other compensation.

 

(b)                     Number of Shares. Each Restricted Share Unit Agreement shall specify the number of Shares to which the Restricted Share Unit pertains, which number is subject to adjustment in accordance with Section 10.

 

(c)                      Payment for Restricted Share Units. To the extent that an Award is granted in the form of Restricted Share Units, no cash consideration shall be required of the Award recipients.

 

(d)                     Vesting Conditions. The Committee shall determine the vesting schedule of each Restricted Share Unit. Vesting shall occur, in full or in installments, upon satisfaction of the conditions specified in the Restricted Share Unit Agreement which may include performance conditions or Performance Goals. A Restricted Share Unit Agreement may provide for accelerated vesting in the event of the Participant’s death, Disability, or other events.

 

(e)                      Form and Time of Settlement of Restricted Share Units. Settlement of vested Restricted Share Units may be made in the form of (i) cash, (ii) Shares or (iii) any combination of both, as determined by the Committee at the time of the grant of the Restricted Share Units, in its sole discretion. Vested Restricted Share Units may be settled in a lump sum or in installments. The distribution may occur or commence when the vesting conditions applicable to the Restricted Share Units have been satisfied or have lapsed, or it may be deferred, in accordance with Applicable Laws, to any later date. The amount of a deferred distribution may be increased by an interest factor or by dividend equivalents.

 

(f)                       Voting and Dividend Rights. The holders of Restricted Share Units shall have no voting rights. Prior to settlement or forfeiture, any Restricted Share Unit awarded under the Plan may, at the Committee’s discretion, carry with it a right to dividend equivalents. Such right entitles the holder to be credited with an amount equal to all cash dividends paid on one Share while the Restricted Share Unit is outstanding. Dividend equivalents may be converted into additional Restricted Share Units. Settlement of dividend equivalents may be made in the form of cash, in the form of Shares, or in a combination of both. Prior to distribution, any dividend equivalents which are not paid shall be subject to the same conditions and restrictions as the Restricted Share Units to which they attach.

 

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(g)                      Creditors’ Rights. A holder of Restricted Share Units shall have no rights other than those of a general creditor of the Company. Restricted Share Units represent an unfunded and unsecured obligation of the Company, subject to the terms and conditions of the applicable Restricted Share Unit Agreement.

 

(h)                     Modification or Assumption of Restricted Share Units. Within the limitations of the Plan, the Committee may modify or assume outstanding Restricted Share Units or may accept the cancellation of outstanding restricted share units (including restricted share units granted by another issuer) in return for the grant of new Restricted Share Units for the same or a different number of Shares. Notwithstanding the preceding sentence or anything to the contrary, no modification of a Restricted Share Unit shall, without the consent of the Participant, impair his or her rights or obligations under such Restricted Share Unit.

 

(i)                         Assignment or Transfer of Restricted Share Units. Except as otherwise provided in the applicable Restricted Share Unit Agreement and then only to the extent such transfer is otherwise permitted by Applicable Laws, no Restricted Share Unit or interest therein shall be transferred, assigned, pledged or hypothecated by the Participant during his or her lifetime, whether by operation of law or otherwise, or be made subject to execution, attachment or similar process, other than by will or by the laws of descent and distribution.

 

SECTION 10. PROTECTION AGAINST DILUTION.

 

(a)                     Adjustments. In the event of a subdivision of the outstanding Shares, a declaration of a dividend payable in Shares, a declaration of a dividend payable in a form other than Shares in an amount that has a material effect on the price of Shares, a combination or consolidation of the outstanding Shares (by reclassification or otherwise) into a lesser number of Shares, a recapitalization, a spin-off or a similar occurrence, the Committee shall make appropriate adjustments in one or more of:

 

(i)                                     the number of Shares and the kind of shares or securities available for future Awards under Section 5(a);

 

(ii)                                  the limits on all Awards per Fiscal Year specified in Section 5(b);

 

(iii)                               the limits on ISOs specified in Section 5(c);

 

(iv)                              the number of Shares and the kind of shares or securities covered by each outstanding Award; or

 

(v)                                 the Exercise Price under each outstanding Option or SAR.

 

(b)                     Participant Rights. Except as provided in this Section 10, a Participant shall have no rights by reason of any issue by the Company of shares of any class or securities convertible into shares of any class, any subdivision or consolidation of shares of any class, the payment of any share dividend or any other increase or decrease in the number of shares of any class. If by reason of an adjustment pursuant to this Section 10 a Participant’s Award covers additional or different shares or securities, then such additional or different shares and the Award in respect thereof shall be subject to all of the terms, conditions and restrictions which were applicable to the Award and the Shares subject to the Award prior to such adjustment.

 

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(c)                      Fractional Shares. Any adjustment of Shares pursuant to this Section 10 shall be rounded down to the nearest whole number of Shares. Under no circumstances shall the Company be required to authorize or issue fractional shares and no consideration shall be provided as a result of any fractional shares not being issued or authorized.

 

SECTION 11. EFFECT OF A CHANGE IN CONTROL.

 

(a)                     Change in Control. In the event that the Company is a party to a Change in Control, outstanding Awards shall be subject to the applicable agreement of merger or reorganization. Such agreement may provide, without limitation, for the assumption of outstanding Awards by the surviving corporation or its parent, for their continuation by the Company (if the Company is a surviving corporation), for accelerated vesting or for their cancellation with or without consideration, in all cases without the consent of the Participant.

 

(b)                     Acceleration. Notwithstanding the foregoing, the Committee may determine, at the time of grant of an Award or thereafter, that such Award shall become vested and exercisable, in full or in part, in the event that the Company is a party to a Change in Control.

 

(c)                      Dissolution. To the extent not previously exercised or settled, Options, SARs and Restricted Share Units shall terminate immediately prior to the dissolution or liquidation of the Company.

 

SECTION 12. LIMITATIONS ON RIGHTS.

 

(a)                     Participant Rights. A Participant’s rights, if any, in respect of or in connection with any Award is derived solely from the discretionary decision of the Company to permit the individual to participate in the Plan and to benefit from a discretionary Award. By accepting an Award under the Plan, a Participant expressly acknowledges that there is no obligation on the part of the Company to continue the Plan and/or grant any additional Awards. Any Award granted hereunder is not intended to be compensation of a continuing or recurring nature, or part of a Participant’s normal or expected compensation, and in no way represents any portion of a Participant’s salary, compensation, or other remuneration for purposes of pension benefits, severance, redundancy, resignation or any other purpose.

 

Neither the Plan nor any Award granted under the Plan shall be deemed to give any individual a right to remain an employee, consultant or director of the Company, a Parent, a Subsidiary or an Affiliate. The Company and its Parent, Subsidiaries and Affiliates reserve the right to terminate the Service of any person at any time, and for any reason, subject to Applicable Laws, and any applicable written employment agreement (if any), and such terminated person shall be deemed irrevocably to have waived any claim to damages or specific performance for breach of contract or dismissal, compensation for loss of office, tort or otherwise with respect to the Plan or any outstanding Award that is forfeited and/or is terminated by its terms or to any future Award.

 

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(b)                     Shareholders’ Rights. Except as provided in Section 9(f), a Participant shall have no dividend rights, voting rights or other rights as a shareholder with respect to any Shares covered by his or her Award prior to the issuance of such Shares (as evidenced by an appropriate entry on the books of the Company or a duly authorized transfer agent of the Company). No adjustment shall be made for cash dividends or other rights for which the record date is prior to the date when such Shares are issued, except as expressly provided in Section 9(f) and Section 10.

 

(c)                      Regulatory Requirements. Any other provision of the Plan notwithstanding, the obligation of the Company to issue Shares or other securities under the Plan shall be subject to all Applicable Laws and such approval by any regulatory body as may be required. The Company reserves the right to restrict, in whole or in part, the delivery of Shares or other securities pursuant to any Award prior to the satisfaction of all legal requirements relating to the issuance of such Shares or other securities, to their registration, qualification or listing or to an exemption from registration, qualification or listing.

 

SECTION 13. WITHHOLDING TAXES.

 

(a)                     General. A Participant shall make arrangements satisfactory to the Company for the satisfaction of any withholding tax obligations that arise in connection with his or her Award. The Company shall have the right to deduct from any amount payable under the Plan, including delivery of Shares to be made pursuant to an Award granted under the Plan, all federal, state, city, local or foreign taxes of any kind required by law to be withheld with respect to such payment and the Company may take any such actions as may be necessary in the opinion of the Company to satisfy all obligations for the payment of such taxes. The Company shall not be required to issue any Shares or make any cash payment under the Plan until such obligations are satisfied.

 

(b)                     Share Withholding. The Committee may permit a Participant to satisfy all or part of his or her withholding or income tax obligations by Cashless Exercise, by having the Company withhold all or a portion of any Shares that otherwise would be issued to him or her or by surrendering all or a portion of any Shares that he or she previously acquired; provided that Shares withheld or previously owned Shares that are tendered shall not exceed the amount necessary to satisfy the Company’s tax withholding obligations at the minimum statutory withholding rates, including, but not limited to, U.S. federal and state income taxes, payroll taxes and foreign taxes, if applicable, unless the previously owned Shares have been held for the minimum duration necessary to avoid financial accounting charges under applicable accounting guidance or as otherwise permitted by the Committee in its sole and absolute discretion. Any payment of taxes by assigning Shares to the Company may be subject to restrictions, including, but not limited to, any restrictions required by rules of the SEC. If any Shares are used to satisfy withholding taxes, such Shares shall be valued based on the Fair Market Value thereof on the date when the withholding for taxes is required to be made.

 

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SECTION 14. DURATION AND AMENDMENTS.

 

(a)                     Term of the Plan. The Plan will expire on, and no Award may be granted pursuant to the Plan after, the seventh anniversary of the Effective Date, and the Plan may be terminated on any earlier date pursuant to this Section 14. Any Awards that are outstanding at the time of expiration or termination of this Plan shall remain in force according to the terms of the Plan and the applicable Award Agreement.

 

(b)                     Right to Amend or Terminate the Plan. The Board may amend or terminate the Plan at any time and for any reason. Any such termination of the Plan, or any amendment thereof, shall not impair any Award previously granted under the Plan unless permitted under Applicable Laws. No Awards shall be granted under the Plan after the Plan’s termination.

 

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