Document:

Exhibit 4.1

 

	
  

  	
  THIS CERTIFIES
  THAT is the owner of CUSIP DATED COUNTERSIGNED AND REGISTERED: COMPUTERSHARE
  TRUST COMPANY, N.A. TRANSFER AGENT AND REGISTRAR, FULLY-PAID AND
  NON-ASSESSABLE SHARES OF THE COMMON STOCK OF Credo Petroleum Corporation
  (hereinafter called the “Company”), transferable on the books of the Company
  in person or by duly authorized attorney, upon surrender of this Certificate
  properly endorsed. This Certificate and the shares represented hereby, are
  issued and shall be held subject to all of the provisions of the Certificate
  of Incorporation, as amended, and the By-Laws, as amended, of the Company
  (copies of which are on file with the Company and with the Transfer Agent),
  to all of which each holder, by acceptance hereof, assents. This Certificate
  is not valid unless countersigned and registered by the Transfer Agent and
  Registrar. Witness the facsimile seal of the Company and the facsimile
  signatures of its duly authorized officers. COMMON STOCK PAR VALUE $.10
  COMMON STOCK THIS CERTIFICATE IS TRANSFERABLE IN CANTON, MA AND NEW YORK, NY
  SEE REVERSE FOR CERTAIN DEFINITIONS Certificate Number Shares . CREDO
  PETROLEUM CORPORATION INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
  Chief Executive Officer Vice President & Chief Financial Officer By
  AUTHORIZED SIGNATURE 016570| 003590|127C|RESTRICTED||4|057-423 225439 20 7
  <<Month Day, Year>> * * 600620* * * * * * * * * 600620* * * * * *
  * * * 600620* * * * * * * * * 600620* * * * * * * * * 600620* * ** Mr.
  Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander
  David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample
  **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr.
  Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander
  David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample
  **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr.
  Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander
  David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample
  **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr.
  Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander
  David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample
  **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr.
  Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander
  David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample
  **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr.
  Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander
  David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample
  **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr.
  Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander
  David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample
  **** Mr. Alexander David Sample **** Mr. Alexander David Sample **** Mr. Alexander
  David Sample **** Mr. Alexander David Sample **** Mr. Alexander David Sample
  **** Mr. Sample **** Mr. Sample
  **600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares***
  *600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****
  600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****6
  00620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****60
  0620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600
  620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares***600620**Shares****600620**Shares****60062
  0**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620
  **Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620*
  *Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**
  Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**S
  hares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Shares****600620**Sh
  * * * SIX HUNDRED THOUSAND SIX HUNDRED AND TWENTY* * * MR. SAMPLE & MRS. SAMPLE
  & MR. SAMPLE & MRS. SAMPLE NNNNN ZQ 000000 Certificate Numbers
  1234567890/1234567890 1234567890/1234567890 1234567890/1234567890
  1234567890/1234567890 1234567890/1234567890 1234567890/1234567890 Total
  Transaction Num/No. 123456 Denom. 123456 Total 1234567 MR A SAMPLE
  DESIGNATION (IF ANY) ADD 1 ADD 2 ADD 3 ADD 4 CREDO PETROLEUM CORPORATION PO
  BOX 43004, Providence, RI 02940-3004 CUSIP XXXXXX XX X Holder ID XXXXXXXXXX
  Insurance Value 1,000,000.00 Number of Shares 123456 DTC 12345678
  123456789012345 

  

 

 

	
  

  	
  THIS
  CERTIFICATE ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO CERTAIN RIGHTS
  AS SET FORTH IN THE RIGHTS AGREEMENT BETWEEN CREDO PETROLEUM CORPORATION (THE
  “COMPANY”) AND COMPUTERSHARE TRUST COMPANY, N.A. (THE “RIGHTS AGENT”), DATED
  AS OF APRIL 9, 2009 AS IT MAY BE AMENDED FROM TIME TO TIME (THE “RIGHTS
  AGREEMENT”), THE TERMS OF WHICH ARE HEREBY INCORPORATED HEREIN BY REFERENCE
  AND A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICES OF THE COMPANY. UNDER
  CERTAIN CIRCUMSTANCES, AS SET FORTH IN THE RIGHTS AGREEMENT, SUCH RIGHTS WILL
  BE EVIDENCED BY SEPARATE CERTIFICATES AND WILL NO LONGER BE EVIDENCED BY THIS
  CERTIFICATE. THE COMPANY WILL MAIL TO THE HOLDER OF THIS CERTIFICATE A COPY
  OF THE RIGHTS AGREEMENT, AS IN EFFECT ON THE DATE OF MAILING, WITHOUT CHARGE
  PROMPTLY AFTER RECEIPT OF A WRITTEN REQUEST THEREFOR. AS SET FORTH IN THE
  RIGHTS AGREEMENT, RIGHTS BENEFICIALLY OWNED BY ANY PERSON (AS DEFINED IN THE
  RIGHTS AGREEMENT) WHO BECOMES AN ACQUIRING PERSON (AS DEFINED IN THE RIGHTS
  AGREEMENT) BECOME NULL AND VOID. THE COMPANY WILL FURNISH WITHOUT CHARGE TO
  EACH SHAREHOLDER WHO SO REQUESTS, A SUMMARY OF THE POWERS, DESIGNATIONS,
  PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL OR OTHER SPECIAL RIGHTS OF
  EACH CLASS OF STOCK OF THE COMPANY AND THE QUALIFICATIONS, LIMITATIONS OR
  RESTRICTIONS OF SUCH PREFERENCES AND RIGHTS, AND THE VARIATIONS IN RIGHTS,
  PREFERENCES AND LIMITATIONS DETERMINED FOR EACH SERIES, WHICH ARE FIXED BY
  THE CERTIFICATE OF INCORPORATION OF THE COMPANY, AS AMENDED, AND THE
  RESOLUTIONS OF THE BOARD OF DIRECTORS OF THE COMPANY, AND THE AUTHORITY OF
  THE BOARD OF DIRECTORS TO DETERMINE VARIATIONS FOR FUTURE SERIES. SUCH
  REQUEST MAY BE MADE TO THE OFFICE OF THE SECRETARY OF THE COMPANY OR TO THE
  TRANSFER AGENT. THE BOARD OF DIRECTORS MAY REQUIRE THE OWNER OF A LOST OR
  DESTROYED STOCK CERTIFICATE, OR HIS LEGAL REPRESENTATIVES, TO GIVE THE
  COMPANY A BOND TO INDEMNIFY IT AND ITS TRANSFER AGENTS AND REGISTRARS AGAINST
  ANY CLAIM THAT MAY BE MADE AGAINST THEM ON ACCOUNT OF THE ALLEGED LOSS OR
  DESTRUCTION OF ANY SUCH CERTIFICATE. The following abbreviations, when used
  in the inscription on the face of this certificate, shall be construed as
  though they were written out in full according to applicable laws or
  regulations: TEN COM - as tenants in common UNIF GIFT MIN ACT- . . . . . . .
  . . .Custodian . . . . . . . . . . . . . . . TEN ENT - as tenants by the
  entireties under Uniform Gifts to Minors Act . . . . . . . . . . . . . JT TEN
  - as joint tenants with right of survivorship UNIF TRF MIN ACT . . . . . . .
  . . . . . . . .Custodian (until age. . . ). . . . . . . . . . . and not as
  tenants in common (Cust) (Minor) under Uniform Transfers to Minors Act. . . .
  . . . . . . (State) Additional abbreviations may also be used though not in
  the above list. For value received, hereby sell, assign and transfer unto
  Shares  Attorney Dated: 20 Signature:
  Signature: Notice: The signature to this assignment must correspond with the
  name as written upon the face of the certificate, in every particular,
  without alteration or enlargement, or any change whatever. (Cust) (Minor)
  (State) PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
  (PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE, OF
  ASSIGNEE) of the common stock represented by the within Certificate, and do
  hereby irrevocably constitute and appoint to transfer the said stock on the
  books of the within-named Corporation with full power of substitution in the
  premises. . CREDO PETROLEUM CORPORATION TRANSFER FEE $25.00 Signature(s) Guaranteed:
  Medallion Guarantee Stamp THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN
  ELIGIBLE GUARANTOR INSTITUTION (Banks, Stockbrokers, Savings and Loan
  Associations and Credit Unions) WITH MEMBERSHIP IN AN APPROVED SIGNATURE
  GUARANTEE MEDALLION PROGRAM, PURSUANT TO S.E.C. RULE 17Ad-15.ex10_1.htm

Exhibit 10.1

 

Change In Control Policy

 

Scope

 

This policy is designed to cover a limited number of QAD Inc. (Company) individuals whose positions and titles are defined as Company President, Chief Executive Officer, Chief Financial Officer, and Executive Vice President and such Vice Presidents and other individuals as are specifically approved by the Compensation Committee of the Board (Compensation Committee) as eligible for inclusion under this policy (Executives).  Only those Executives who are specifically selected by the Compensation Committee shall be eligible for benefits under this policy.

 

All Change in Control Agreements will follow the conditions set forth in this Policy, except for terms and conditions in individually negotiated, written agreements as approved by the Board.

 

Purpose

 

The Board of Directors of the Company (the “Board”) has determined that it is in the best interests of the Company and its shareholders to assure that the Company will have the continued dedication of the Company’s Executives, notwithstanding the possibility, threat or occurrence of a Change in Control (as defined below) of the Company.  Therefore, this Policy is intended to provide a structured and predefined approach to the treatment of a limited number of Executives in connection with a “Change in Control”.

 

It is imperative to diminish the inevitable distraction of certain Executives by virtue of the personal uncertainties and risks created by a pending or threatened Change in Control, to encourage the Executives’ full attention and dedication to the Company currently and in the event of any threatened or pending Change in Control, and to provide the Executives with compensation arrangements upon a Change in Control which are competitive with those of other corporations.

 

Key Objectives

 

	
  

	
·

	
Retain Top Executive Management through a period of uncertainty

	
  

	
·

	
Enhance the value of the entity to a prospective buyer

	
  

	
·

	
Preserve the neutrality of the Executive Management team in negotiating and executing the transition

	
  

	
·

	
Keep the Executive Management team focused on the business rather than on their personal financial security

	
  

	
·

	
Bridge the unemployment gap

 

Requirements

 

Benefits become payable to an Executive after both a Change in Control during the term of an Executive’s Change in Control Agreement and the Executive’s employment with the Company is terminated within an eighteen (18) month period following the Change in Control either involuntarily by the Company without Cause or by the Executive as a result of a “Change in Status” (defined below) (such events referred to together as a "Double Trigger").

 

  

1

  

 

Certain Equity Compensation (as defined below) acceleration benefits become payable to an Executive that remains employed with the Company after a Change in Control during the term of an Executive’s Change in Control Agreement.

 

No benefits shall be payable under this Policy and the provisions of this Policy shall be of no force or effect unless (1) the Executive has a signed Change in Control Agreement, (2) there shall have been a Change in Control, and (3) during the eighteen (18) month term directly following the Change in Control the Executive’s employment with the Company is terminated either involuntarily by the Company without Cause or by the Executive as a result of a “Change in Status” (defined below).  For all purposes under this Policy, references to “termination of employment,” “employment terminates” and similar terms shall mean “separation from service” as defined for purposes of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) and regulations promulgated thereunder.

 

Definitions:

 

“Change in Control”:

 

Shall mean the first occurrence of any of the following events:

 

	
  

	
·

	
Any person (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended) or persons acting as a group, other than Pamela M. Lopker and Karl F. Lopker as joint holders, or either of them (the “Lopkers”) or a living trust for their benefit over which they maintain control of the assets of the trust and the voting rights for shares in the trust, is or becomes the “beneficial owner” (as defined in Rule 13d-3 under said Act), directly or indirectly, of securities of the Company representing more than fifty percent (50%) of the total voting power represented by the Company’s then outstanding voting securities.

	
  

	
·

	
A merger or consolidation of the Company with any other corporation, other than a merger or consolidation that would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least fifty percent (50%) of the total voting power represented by the voting securities of the Company; or such surviving entity outstanding immediately after such merger or consolidation; or

	
  

	
·

	
The sale or other disposition by the Company of all, or substantially all, of the Company’s assets, other than a transfer to (i) a stockholder of the Company (immediately before the asset transfer) in exchange for or with respect to its stock, (ii) an entity, fifty percent (50%) or more of the total value or voting power of which is owned, directly or indirectly, by the Company, (iii) a person, or persons acting as a group, that owns, directly or indirectly, fifty percent (50%) or more of the total value or voting power represented by the Company’s then outstanding voting securities, or (iv) an entity, fifty percent (50%) or more of the total value or voting power of which is owned, directly or indirectly, by a person described in clause (iii).

  

  

2

  

Each of the foregoing events is intended to qualify as a change in ownership or effective control for purposes of Section 409A(a)(2)(A)(v) of the Code, and this Policy shall be interpreted accordingly.

 

“Change in Status”

 

Shall mean and exist upon the occurrence, within an eighteen (18) month period following a Change in Control, of any of the following events regarding the Executive’s duties, compensation, principal place of work, or employment status:

 

	
  

	
·

	
The Executive is assigned any duties which are wholly and clearly inconsistent with the position and status of an executive of the Company, or a substantial alteration in the nature, status or prestige of Executive’s official position resulting in a decrease in authority or responsibilities from those in effect immediately prior to a Change in Control;

	
  

	
·

	
The Executive’s Base Monthly Salary is decreased by the Company, or the Executive’s benefits or opportunities under any employee benefit or incentive plan or program of the Company is or are materially reduced other than in connection with a reduction in salary or benefits generally applicable to all employees of the Company;

	
  

	
·

	
The Executive’s principal office location is relocated to a location more than twenty-five (25) miles from the Executive’s then present location without the Executive’s written consent;

	
  

	
·

	
The Company fails to pay the Executive any deferred payments under any bonus or incentive plans in a timely manner;

	
  

	
·

	
The Company fails to reimburse the Executive for business expenses in accordance with the Company’s policies, procedures or practices;

	
  

	
·

	
The Company fails to agree to or actually indemnify the Executive for the Executive’s actions and/or inactions, as either a director or officer of the Company, to the fullest extent permitted by Delaware law, and the Company fails to maintain reasonable levels of directors and officers liability insurance coverage for the Executive when such insurance is available;

	
  

	
·

	
The Company fails to obtain a written agreement from any successor or assign of the Company to assume and perform Executive’s employment agreement as then in effect and the Change in Control Agreement; or

	
  

	
·

	
The Company purports to terminate the Executive’s employment for Cause and such purported termination of employment is not effected in accordance with this Policy.

 

“Agreement”

 

Shall mean a formal document approved by QAD’s officer in charge of legal matters.  The Agreement shall be approved and signed by a designated member of the Compensation Committee and the Executive to which the Agreement pertains.

 

  

3

  

 

Termination for “Cause”

 

“Cause” shall mean (a) the Executive is convicted of a felony involving property of the Company, or (b) the Executive, in carrying out the Executive’s duties under any and all Company policies, is guilty of willful refusal to perform, or willful neglect of, the Executive’s duties.  In the event that Executive’s employment with the Company is terminated for Cause after a Change in Control and during the term of an Agreement, Executive shall receive Executive’s full base salary as earned through the Date of Termination at the rate in effect at the time Notice of Termination is given.  Following payment of the salary amount, the Company shall have no further obligations to Executive.

 

Three (3) Tiered Benefits Structure for Change in Control

 

Change in Control Benefits shall mean a lump sum payment, for the compensation base, average annual bonus and benefit replacement calculations as described below, delivered to the Executive within 30 days after the Double Trigger has been satisfied.

 

	
  

	
·

	
Compensation Base is defined as an Executive’s highest fiscal year based salary in effect within two years prior to the Change in Control

	
  

	
·

	
Average Annual Bonus is defined as an Executive’s average annual bonus for the two full fiscal years immediately preceding the Change in Control

	
  

	
·

	
Vesting of any equity compensation granted under the QAD Inc. 2006 Stock Incentive Program ("Equity Compensation") to commence at time of termination of Executive’s employment

	
  

	
·

	
Payment to compensate for employee benefits being received at time of termination of Executive’s employment

 

Tier #1 Benefits Structure:

 

	
  

	
·

	
Participation: Included in this Tier are the following Company Executives

 

	 	
1. 

	
Chief Executive Officer

	 	
2.  

	
President

	 	
3.  

	
Chief Financial Officer

 

	
  

	
·

	
Benefits:

 

	
  

	
·

	
Eighteen (18) months of compensation base

	
  

	
·

	
One and one-half (1 1/2) multiple of average annual bonus

	
  

	
·

	
Vesting of all Equity Compensation

	
  

	
·

	
Eighteen (18) months benefit replacement payment

  

4

  

 

Tier #2 Benefits Structure:

 

	
  

	
·

	
Participation:     Included in this Tier, Executives with Position Title of Executive Vice President, and other members of the Company’s Executive Committee by prior approval of the Compensation Committee

 

	
  

	
·

	
Benefits:

 

	
  

	
●

	
Twelve (12) months of compensation base

	
  

	

●

	
One (1) multiple of average annual bonus

	
  

	
●

	
Vesting of all Equity Compensation

	
  

	
●

	
Twelve (12) months benefit replacement payment

 

Tier #3 Benefits Structure:

 

	
  

	
·

	
Participation:

	
Included in this Tier are Executives with titles of Vice President by prior approval of the Compensation Committee and other individuals by prior approval of the Compensation Committee

 

	
  

	
·

	
Benefits:

 

	
  

	
●

	
Six (6) months of compensation base

	
  

	
●

	
One (1) multiple of average annual bonus

	
  

	
●

	
Vesting of all Equity Compensation

	
  

	
●

	
Six (6) months benefit replacement payment

Compliance with Section 409A

 

	 	
·

	
Payment to Specified Employee:  If a payment obligation under the Agreement is made to an Executive upon his or her separation from service while he or she is a “specified employee” (as defined under Section 409A of the Code and determined in good faith by the Compensation Committee), any payment of “deferred compensation” (as defined under Treasury Regulation Section 1.409A-1(b)(1) after giving effect to the exemptions in Treasury Regulation Sections 1.409A-1(b)(3) through (b)(12 that is scheduled to be paid within six (6) months after such separation from service shall accrue with interest and shall be paid within 30 days after the end of the six-month period beginning on the date of such separation from service or, if earlier, within 30 days after the appointment of the personal representative or executor of the Executive’s estate following his death.  During the 6-month delay period, interest shall accrue at the prime rate of interest published in the northeast edition of The Wall Street Journal on the date of Executive’s separation from service.  Accordingly, subject to the requirements of Section 409A of the Code, an Executive may not receive his or her Change in Control Benefits payment until 6 months after separation from service.

 

  

5

  

 

	 	
·

	
Compliance Intended:  This Policy is intended not to result in the imposition of any tax, interest charge or other assessment, penalty or addition under Section 409A of the Code.  In addition to any specific references to Section 409A of the Code in this Policy, all terms and conditions of this Policy are intended, and shall be interpreted and applied to the greatest extent possible in such manner as may be necessary, to comply with the provisions of Section 409A of the Code and any rules, regulations or other regulatory guidance issued under Section 409A of the Code.  However, the Company does not guarantee any particular tax effect to Executive.  The Company shall not be liable to Executive for any payment made under this Agreement that is determined to result in an additional tax, penalty, or interest under Section 409A of the Code, nor for reporting in good faith any payment made under this Agreement as an amount includible in gross income under Section 409A of the Code.

 

Right to Terminate Employment

 

Nothing in this Policy shall confer upon Executive any right to continue in the employ of the Company or shall interfere with or restrict in any way the rights of the Company, which are hereby expressly reserved, to discharge Executive at any time for any reason whatsoever with or without cause.

 

 

6

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