Document:

nl-ex1012_435.htm

 

Exhibit 10.12

ELEVENTH AMENDED AND RESTATED

UNSECURED REVOLVING

DEMAND PROMISSORY NOTE

	
$60,000,000.00
	
December 31, 2017

 

 

Section 1.  Promise to Pay.  For and in consideration of value received, the undersigned, Valhi, Inc., a corporation duly organized under the laws of the state of Delaware (“Borrower”), promises to pay, in lawful money of the United States of America, to the order of Kronos Worldwide, Inc., a corporation duly organized under the laws of the state of Delaware (“Kronos Worldwide”), or the holder hereof (as applicable, Kronos Worldwide or such holder shall be referred to as the “Noteholder”), the principal sum of SIXTY MILLION and NO/100ths United States Dollars ($60,000,000.00) or such lesser amount as shall equal the unpaid principal amount of the loan made by the Noteholder to Borrower together with accrued and unpaid interest on the unpaid principal balance from time to time pursuant to the terms of this Eleventh Amended and Restated Unsecured Revolving Demand Promissory Note, as it may be amended from time to time (this “Note”).  This Note shall be unsecured and will bear interest on the terms set forth in Section 7 below. Capitalized terms not otherwise defined shall have the meanings given to such terms in Section 19 of this Note.

 

Section 2.  Amendment and Restatement.  This Note renews, replaces, amends and restates in its entirety the Tenth Amended and Restated Unsecured Revolving Demand Promissory Note dated December 31 2016 in the original principal amount of $60,000,000.00 payable to the order of the Noteholder and executed by the Borrower (the “Tenth Amended Note”).  The Tenth Amended Note renewed, replaced, amended and restated in its entirety the Ninth Amended and Restated Unsecured Revolving Demand Promissory Note dated August 3, 2016 in the original principal amount of $60,000,000.00 payable to the order of the Noteholder and executed by the Borrower (the “Ninth Amended Note”).  The Ninth Amended Note renewed, replaced, amended and restated in its entirety the Eighth Amended and Restated Unsecured Revolving Demand Promissory Note dated December 31, 2015 in the original principal amount of $100,000,000.00 payable to the order of the Noteholder and executed by the Borrower (the “Eighth Amended Note”).  The Eighth Amended Note renewed, replaced, amended and restated in its entirety the Seventh Amended and Restated Unsecured Revolving Demand Promissory Note dated December 31, 2014 in the original principal amount of $100,000,000.00 payable to the order of the Noteholder and executed by the Borrower (the “Seventh Amended Note”).  The Seventh Amended Note renewed, replaced, amended and restated in its entirety the Sixth Amended and Restated Unsecured Revolving Demand Promissory Note dated December 31, 2013 in the original principal amount of $100,000,000.00 payable to the order of the Noteholder and executed by the Borrower (the “Sixth Amended Note”).  The Sixth Amended Note renewed, replaced, amended and restated in its entirety the Fifth Amended and Restated Unsecured Revolving Demand Promissory Note dated December 31, 2012 in the original principal amount of $100,000,000.00 payable to the order of the Noteholder and executed by the Borrower (the “Fifth Amended Note”).  The Fifth Amended Note renewed, replaced, amended and restated in its entirety the Fourth Amended and Restated Unsecured Revolving Demand Promissory Note dated December 19, 2012 in the original principal amount of $235,000,000.00 payable to the order of the Noteholder and executed by the Borrower (the “Fourth Amended Note”).  The Fourth Amended Note renewed, replaced, amended and restated in its entirety the Third Amended and Restated Unsecured Revolving Demand Promissory Note dated December 31, 2011 in the original principal amount of $225,000,000.00 payable to the order of the Noteholder and executed by the Borrower (the “Third Amended Note”).  The Third Amended Note renewed, replaced, amended and restated in its entirety the Second Amended and Restated Unsecured Revolving Demand Promissory Note dated June 30, 2011 in the original principal amount of $175,000,000.00 payable to the order of the Noteholder and executed by the Borrower (the “Second Amended Note”).  The Second Amended Note renewed, replaced, amended and restated in its entirety the First Amended and Restated Unsecured Revolving Demand Promissory Note dated December 31, 2010 in the original principal amount of $175,000,000.00 payable to the order of the Noteholder and executed by the Borrower (the “First Amended Note”).  The First Amended Note renewed, replaced, amended and restated in its entirety the Unsecured Revolving Demand Promissory Note dated November 10, 2010 in the original principal amount of $100,000,000.00 payable to the order of the Noteholder and executed by the Borrower (the “Original Note”).  This Note renews, replaces, amends and restates in its entirety the Tenth Amended Note, the Ninth Amended Note, the Eighth Amended Note, the Seventh Amended Note, the Sixth Amended Note, the Fifth Amended Note, the Fourth Amended Note, the Third Amended Note, the Second Amended Note, the First Amended Note and the Original Note (collectively, the “Prior Notes”); provided that such amendment and restatement shall operate to renew, amend and modify the rights and obligations of the parties under each Prior Note, as provided herein, but shall not extinguish the obligations under each Prior Note, nor effect a novation thereof.  As of the close of business on December 31, 2017, the unpaid principal balance of the Ninth Amended Note was $13,600,000.00, the accrued and unpaid interest thereon was nil and the accrued and unpaid commitment fee thereon was nil, which is the unpaid principal, accrued and unpaid interest and accrued and unpaid 

 

Page 1 of 5.

 

commitment fee owed under this Note as of the close of business on the date of this Note.  This Note contains the entire understanding between the Noteholder and the Borrower with respect to the transactions contemplated hereby and supersedes all other instruments, agreements and understandings between the Noteholder and the Borrower with respect to the subject matter of this Note.

 

Section 3.  Place of Payment.  All payments will be made at Noteholder’s address at Three Lincoln Centre, 5430 LBJ Freeway, Suite 1700, Dallas, Texas   75240-2697, Attention:  Treasurer, or such other place as the Noteholder may from time to time appoint in writing.

 

Section 4.  Payments.  The unpaid principal balance of this Note and any accrued and unpaid interest thereon shall be due and payable on the Final Payment Date.  Prior to the Final Payment Date, any accrued and unpaid interest on an unpaid principal balance shall be paid in arrears quarterly on the last day of each March, June, September and December, commencing March 31, 2018.  All payments on this Note shall be applied first to accrued and unpaid interest, next to accrued interest not yet payable and then to principal.  If any payment of principal or interest on this Note shall become due on a day that is not a Business Day, such payment shall be made on the next succeeding Business Day and the payment shall be the amount owed on the original payment date.

 

Section 5.  Prepayments.  This Note may be prepaid in part or in full at any time without penalty.

 

Section 6.  Borrowings.  Prior to the Final Payment Date, Noteholder expressly authorizes Borrower to borrow, repay and re-borrow principal under this Note in increments of $100,000 on a daily basis so long as:

 

	
 
	
•
	
the aggregate outstanding principal balance does not exceed $60,000,000.00; and

	
 
	
•
	
no Event of Default has occurred and is continuing.

 

Notwithstanding anything else in this Note, in no event will Noteholder be required to lend money to Borrower under this Note and loans under this Note shall be at the sole and absolute discretion of Noteholder.

 

Section 7.  Interest.  The unpaid principal balance of this Note shall bear interest at the rate per annum of the Prime Rate plus one percent (1.00%).  In the event that an Event of Default occurs and is continuing, the unpaid principal amount shall bear interest from the Event of Default at the rate per annum of the Prime Rate plus four percent (4.00%) until such time as the Event of Default is cured.  Accrued interest on the unpaid principal of this Note shall be computed on the basis of a 365- or 366-day year for actual days (including the first, but excluding the last day) elapsed, but in no event shall such computation result in an amount of accrued interest that would exceed accrued interest on the unpaid principal balance during the same period at the Maximum Rate. Notwithstanding anything to the contrary, this Note is expressly limited so that in no contingency or event whatsoever shall the amount paid or agreed to be paid to the Noteholder exceed the Maximum Rate.  If, from any circumstances whatsoever, the Noteholder shall ever receive as interest an amount that would exceed the Maximum Rate, such amount that would be excessive interest shall be applied to the reduction of the unpaid principal balance and not to the payment of interest, and if the principal amount of this Note is paid in full, any remaining excess shall be paid to Borrower, and in such event, the Noteholder shall not be subject to any penalties provided by any laws for contracting for, charging, taking, reserving or receiving interest in excess of the highest lawful rate permissible under applicable law.  All sums paid or agreed to be paid to Noteholder for the use, forbearance or detention of the indebtedness of the Borrower to Noteholder shall, to the extent permitted by applicable law, be amortized, prorated, allocated and spread throughout the full term of such indebtedness until payment in full of the principal (including the period of any renewal or extension thereof) so that the interest on account of such indebtedness shall not exceed the Maximum Rate.  If at any time the Contract Rate is limited to the Maximum Rate, any subsequent reductions in the Contract Rate shall not reduce the rate of interest on this Note below the Maximum Rate until the total amount of interest accrued equals the amount of interest that would have accrued if the Contract Rate had not been limited by the Maximum Rate.  In the event that, upon the Final Payment Date, the total amount of interest paid or accrued on this Note is less than the amount of interest that would have accrued if the Contract Rate had not been limited by the Maximum Rate, then at such time, to the extent permitted by law, in addition to the principal and any other amounts Borrower owes to the Noteholder, the Borrower shall pay to the Noteholder an amount equal to the difference between:  (i) the lesser of the amount of interest that would have accrued if the Contract Rate had not been limited by the Maximum Rate or the amount of interest that would have accrued if the Maximum Rate had at all times been in effect; and (ii) the amount of interest actually paid on this Note.

 

Page 2 of 5.

 

 

Section 8.  Fees and Expenses. On the last day of each March, June, September and December, commencing March 31, 2018, and on the Final Payment Date, Borrower shall pay to Noteholder the Unused Commitment Fee for such period, provided, however, Borrower will not owe any Unused Commitment Fee for any part of such period (prorated as applicable) that the Noteholder is a net borrower of money from the Borrower.  In addition, Borrower and any guarantor jointly and severally agree to pay on the Final Payment Date to Noteholder any other cost or expense reasonably incurred by Noteholder in connection with Noteholder’s commitment to Borrower pursuant to the terms of this Note, including without limitation any other cost reasonably incurred by Noteholder pursuant to the terms of any credit facility of Noteholder.

 

Section 9.  Remedy.  Upon the occurrence and during the continuation of an Event of Default, the Noteholder shall have all of the rights and remedies provided in the applicable Uniform Commercial Code, this Note or any other agreement among Borrower and in favor of the Noteholder, as well as those rights and remedies provided by any other applicable law, rule or regulation.  In conjunction with and in addition to the foregoing rights and remedies of the Noteholder, the Noteholder may declare all indebtedness due under this Note, although otherwise unmatured, to be due and payable immediately without notice or demand whatsoever.  All rights and remedies of the Noteholder are cumulative and may be exercised singly or concurrently.  The failure to exercise any right or remedy will not be a waiver of such right or remedy.

 

Section 10.  Right of Offset.  The Noteholder shall have the right of offset against amounts that may be due by the Noteholder now or in the future to Borrower against amounts due under this Note.

 

Section 11.  Record of Outstanding Indebtedness.  The date and amount of each repayment of principal outstanding under this Note or interest thereon shall be recorded by Noteholder in its records.  The principal balance outstanding and all accrued or accruing interest owed under this Note as recorded by Noteholder in its records shall be the best evidence of the principal balance outstanding and all accrued or accruing interest owed under this Note; provided that the failure of Noteholder to so record or any error in so recording or computing any such amount owed shall not limit or otherwise affect the obligations of the Borrower under this Note to repay the principal balance outstanding and all accrued or accruing interest.

 

Section 12.  Waiver.  Borrower and each surety, endorser, guarantor, and other party now or subsequently liable for payment of this Note, severally waive demand, presentment for payment, notice of nonpayment, notice of dishonor, protest, notice of protest, notice of the intention to accelerate, notice of acceleration, diligence in collecting or bringing suit against any party liable on this Note, and further agree to any and all extensions, renewals, modifications, partial payments, substitutions of evidence of indebtedness, and the taking or release of any collateral with or without notice before or after demand by the Noteholder for payment under this Note.

 

Section 13.  Costs and Attorneys’ Fees.  In addition to any other amounts payable to Noteholder pursuant to the terms of this Note, in the event the Noteholder incurs costs in collecting on this Note, this Note is placed in the hands of any attorney for collection, suit is filed on this Note or if proceedings are had in bankruptcy, receivership, reorganization, or other legal or judicial proceedings for the collection of this Note, Borrower and any guarantor jointly and severally agree to pay on demand to the Noteholder all expenses and costs of collection, including, but not limited to, reasonable attorneys’ fees incurred in connection with any such collection, suit, or proceeding, in addition to the principal and interest then due.

 

Section 14.  Time of Essence.  Time is of the essence with respect to all of Borrower’s obligations and agreements under this Note.

 

Section 15.  Jurisdiction and Venue.  THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC LAWS OF THE STATE OF TEXAS, WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE STATE OF TEXAS OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF TEXAS.  BORROWER CONSENTS TO JURISDICTION IN THE COURTS LOCATED IN DALLAS, TEXAS.

 

Section 16.  Notice.  Any notice or demand required by this Note shall be deemed to have been given and received on the earlier of (i) when the notice or demand is actually received by the recipient or (ii) 72 hours after the 

 

Page 3 of 5.

 

notice is deposited in the United States mail, certified or registered, with postage prepaid, and addressed to the recipient.  The address for giving notice or demand under this Note (i) to the Noteholder shall be the place of payment specified in Section 3 or such other place as the Noteholder may specify in writing to the Borrower and (ii) to Borrower shall be the address below the Borrower’s signature or such other place as the Borrower may specify in writing to the Noteholder.

 

Section 17.  Amendment or Waiver of Provisions of this Note.  No amendment or waiver of any provision of this Note shall in any event be effective unless the same shall be in a writing referring to this Note and signed by the Borrower and the Noteholder.  Such amendment or waiver shall be effective only in the specific instance and for the specific purpose for which given.  No waiver of any of the provisions of this Note shall be deemed or shall constitute a waiver of any other provisions, whether or not similar, nor shall any waiver constitute a continuing waiver.

 

Section 18.  Successors and Assigns.  All of the covenants, obligations, promises and agreements contained in this Note made by Borrower shall be binding upon its successors and permitted assigns, as applicable.  Notwithstanding the foregoing, Borrower shall not assign this Note or its performance under this Note without the prior written consent of the Noteholder.  Noteholder at any time may assign this Note without the consent of Borrower.

 

Section 19  Definitions.  For purposes of this Note, the following terms shall have the following meanings:

 

(a)“Basis Point” shall mean 1/100th of 1 percent.

 

(b)“Business Day” shall mean any day banks are open in the state of Texas.

 

(c)“Contract Rate” means the amount of any interest (including fees, charges or expenses or any other amounts that, under applicable law, are deemed interest) contracted for, charged or received by or for the account of Noteholder.

 

(d)“Event of Default” wherever used herein, means any one of the following events:

 

(i)the Borrower fails to pay any amount due on this Note and/or any fees or sums due under or in connection with this Note after any such payment otherwise becomes due and payable and three Business Days after demand for such payment;

 

(ii)the Borrower otherwise fails to perform or observe any other provision contained in this Note and such breach or failure to perform shall continue for a period of thirty days after notice thereof shall have been given to the Borrower by the Noteholder;

 

(iii)a case shall be commenced against Borrower, or Borrower shall file a petition commencing a case, under any provision of the Federal Bankruptcy Code of 1978, as amended, or shall seek relief under any provision of any other bankruptcy, reorganization, arrangement, insolvency, readjustment of debt, dissolution or liquidation law of any jurisdiction, whether now or hereafter in effect, or shall consent to the filing of any petition against it under such law, or Borrower shall make an assignment for the benefit of its creditors, or shall admit in writing its inability to pay its debts generally as they become due, or shall consent to the appointment of a receiver, trustee or liquidator of Borrower or all or any part of its property; or

 

(iv)an event occurs that, with notice or lapse of time, or both, would become any of the foregoing Events of Default.

 

(e)“Final Payment Date” shall mean the earlier of:

 

	
 
	
•
	
written demand by the Noteholder for payment of all or part of the unpaid principal, the accrued and unpaid interest thereon and the accrued and unpaid commitment fee thereon, but in any event no earlier than December 31, 2019; or

	
 
	
•
	
acceleration as provided herein.

 

 

Page 4 of 5.

 

(f)“Maximum Rate” shall mean the highest lawful rate permissible under applicable law for the use, forbearance or detention of money.

 

(g)“Prime Rate” shall mean the fluctuating interest rate per annum in effect from time to time equal to the base rate on corporate loans as reported as the Prime Rate in the Money Rates column of The Wall Street Journal or other reliable source.

 

(h)“Unused Commitment Amount” for any period on after the date of this Note shall mean the average on each day of such period of the difference between (A) $60,000,000.00 and (B) the amount of the unpaid principal balance of this Note.

 

(i)“Unused Commitment Fee” shall mean the product of (A) 50 Basis Points per annum (pro rated to take into account that the fee is payable quarterly, or such shorter period if applicable) and (B) the Unused Commitment Amount.

 

	
 
	
BORROWER:

	
 
	
 

	
 
	
Valhi, Inc.

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
By:
	
/s/ Gregory M. Swalwell

	
 
	
 
	
Gregory M. Swalwell

	
 
	
 
	
Executive Vice President, Chief Financial Officer and Chief Accounting Officer

	
 
	
 
	
 

	
 
	
Address:

	
 
	
 

	
 
	
5430 LBJ Freeway, Suite 1700

	
 
	
Dallas, Texas   75240-2697

 

As of the date hereof, Kronos Worldwide, Inc., as the Noteholder, hereby agrees that this Note renews, replaces, amends and restates in its entirety each Prior Note (but shall not extinguish the obligations under each Prior Note, nor effect a novation thereof), and that the unpaid principal of $13,600,000.00, the accrued and unpaid interest thereon of nil and the accrued and unpaid commitment fee thereon of nil that was owed under the Tenth Amended Note as of the close of business on December 31, 2017 are the unpaid principal, the accrued and unpaid interest thereon and the accrued and unpaid commitment fee thereon, respectively, owed under this Note as of the close of business on the date of this Note.

 

	
 
	
KRONOS WORLDWIDE, INC.

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
 
	
 

	
 
	
By:
	
/s/ Tim C. Hafer

	
 
	
 
	
Tim C. Hafer

	
 
	
 
	
Vice President and Controller

 

 

Page 5 of 5.Exhibit 10.7

 

CRA INTERNATIONAL, INC. RESTRICTED STOCK AGREEMENT

 

Notification and Acceptance of Restricted Stock Award
 Non-Employee Director Award Pursuant to Section 6.9 of the Plan

 

Pursuant to the CRA International, Inc. Amended and Restated 2006 Equity Incentive Plan, as amended (the “Plan”), the Director named below (hereinafter the “Holder”) has been granted           shares (the “Restricted Shares”) of the Company’s Common Stock, without par value (“Common Stock”), subject to the restrictions stated below and in the Plan, on the condition that the Holder execute and deliver this Agreement.

 

In accordance with the Plan, the Company is therefore pleased to offer you the following Restricted Stock Award:

 

	
Grant Date:
    	
 
    	
[                 ]
    
	
 
    	
 
    	
 
    
	
Director Name   and Residential Address:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Number of shares of Common Stock granted in this   Restricted Stock Award:
    	
 
    	
         shares   of the Company’s Common Stock
    
	
 
    	
 
    	
 
    
	
Vesting Period:
    	
 
    	
Four years, with Twenty-five Percent (25)% of the   Restricted Stock Award vesting on each anniversary of the Grant Date.
    
	
 
    	
 
    	
 
    
	
Vesting   Schedule:
    	
 
    	
Date% Vested 
    
	
 
    	
 
    	
[                             ]
    	
25%
    	
 
    
	
 
    	
 
    	
[                             ]
    	
50%
    	
 
    
	
 
    	
 
    	
[                             ]
    	
75%
    	
 
    
	
 
    	
 
    	
[                             ]
    	
100%
    	
 
    

 

This Restricted Stock Award is subject to the terms and conditions of the Restricted Stock Agreement set forth below (the “Agreement”).  By signing below you both accept this Restricted Stock Award and acknowledge that you have read, understand, agree to and accept the terms and conditions of the Agreement set forth below.

 

Signed as a Massachusetts agreement under seal as of the Grant Date:

 

CRA INTERNATIONAL, INC.

 

	
 
    	
 
    	
 
    
	
Paul   Maleh
    	
{Insert Holder name}
    
	
President   and CEO
    	
 
    

 

 

Restricted Stock Agreement

 

The terms of this Agreement shall govern the Restricted Stock Award (the “Award”) described in the attached Notification and Acceptance of Restricted Stock Award (the “Notice”), which is hereby incorporated into this Agreement by reference.  Capitalized terms used, but not defined, herein shall have the meanings ascribed to them in the Notice.  The Company agrees to issue the Restricted Shares to the Holder in consideration of the premises made herein and for valuable consideration, the receipt and sufficiency of which is hereby acknowledged, subject to the terms and conditions of the Plan and this Agreement as follows:

 

1.                                      Vesting Schedule.  The interest of the Holder in the Restricted Shares shall vest, as to one-fourth of the Restricted Shares, on the first anniversary of the Grant Date, and, as to an additional one-fourth of the Restricted Shares, on each succeeding anniversary thereof, so as to be 100% vested on the fourth anniversary thereof, conditioned upon the Holder’s continued service as a Director of the Company as of each vesting date.  Notwithstanding the foregoing, the interest of the Holder in the Restricted Shares shall vest as to 100% of the then unvested Restricted Shares upon the Holder’s termination of service as a Director of the Company due to death or Disability.  As used herein, (i) “Vested” (and grammatical variants thereof) shall mean vested in accordance with this Paragraph 1 and the other terms of the Agreement, as it may be amended from time to time and (ii) “Disability” shall mean any condition, arising by reason of ill health or otherwise, on account of which the Holder shall become unable to perform services as a Director of the Company for a period of six (6) consecutive months.

 

2.                                      Forfeiture of Restricted Shares.  If service for the Company as a Director is terminated for any reason (other than death or Disability), the balance of the Restricted Shares that have not Vested at the time of the Holder’s termination of service shall be forfeited by the Holder and shall automatically be transferred and returned to the Company.

 

3.                                      Escrow of Certificates.

 

(a)                                 Simultaneously with the execution of this Agreement, the Holder shall deposit with the Company the certificates representing all of the Restricted Shares and shall, promptly upon acquisition of any additional shares of stock, property or securities described in Paragraphs 5 or 6 hereof, deposit with the Company the certificates for such additional shares, such other property, or instruments representing such securities.  Any such additional shares, property or securities shall for all purposes be deemed Restricted Shares under this Agreement.  To all certificates deposited by the Holder with the Company, there shall be attached stock powers, duly executed by the Holder in blank, constituting and appointing the Company his attorney to transfer such stock on the books of the Company.  The Company shall hold such certificates and stock powers for the purposes of this Agreement.  Notwithstanding anything to the contrary herein, the Company may elect to have the Restricted Shares, including, without limitation, any additional shares of stock, property or securities described in Paragraphs 5 or 6 hereof, issued in book-entry in the Company’s stock record books.  The Holder shall continue to be the owner of the Restricted Shares despite such deposit and stock powers or book-entry

 

2

 

issuance and shall be entitled to exercise all rights of ownership in such Restricted Shares, subject, however, to the provisions of this Agreement.

 

(b)                                 In performing its duties under this Agreement, the Company shall be entitled to rely upon any statement, notice, or other writing that it shall in good faith believe to be genuine and to be signed or presented by a proper party or parties and on other evidence or information deemed by it to be reliable.  In no event shall the Company be liable for any action taken or omitted in good faith.  The Company may consult with its counsel or counsel of any of the other parties hereto and, without limiting the generality of the preceding sentence, shall not be held liable for any action taken or omitted in good faith on advice of such counsel.

 

It is further agreed that if any controversy arises, between the parties hereto or with any third person, with respect to the Restricted Shares or any part of the subject matter of this Agreement or its terms or conditions, the Company shall not be required to take any actions in the premises, but may await the settlement of any such controversy by final appropriate legal proceedings or otherwise as it may require, notwithstanding anything in this Agreement to the contrary, and in such event the Company shall not be liable for interest or damages.

 

In the event that a dispute should arise with respect to the delivery, right to possession, and/or ownership of the certificates, instruments or other property held by the Company representing the Restricted Shares, the Company is authorized to retain such certificates, instruments or other property, as well as any other evidence relating thereto, in its possession, or any portion thereof, without liability to anyone, until such dispute shall have been settled either by mutual written agreement of the parties concerned or by final order, decree or judgment of a court of competent jurisdiction after the time for appeal has expired and no appeal has been perfected, but the Company shall be under no duty whatsoever hereunder to institute or defend any such proceedings.

 

The provisions of this Paragraph 3(b) shall survive the expiration or earlier termination of this Agreement.

 

4.                                      Restriction on Transfer.  Other than as set forth in the preceding Paragraphs of this Agreement with respect to transfers to the Company, the Holder shall not sell, assign, transfer, pledge, hypothecate, mortgage, encumber or otherwise dispose of, voluntarily or involuntarily, by operation of law or otherwise (collectively, “transfer”), any of the Restricted Shares or any interest therein, unless and until such Restricted Shares are Vested.

 

5.                                      Stock Dividends and Certain Other Issuances and Payments.  If the Company shall pay a stock dividend on the Common Stock, or be a party to a merger, consolidation, capital reorganization or recapitalization in which, while existing Common Stock remains outstanding, securities of the Company are issued with respect to any of the Common Stock, the stock or other securities issued in payment of such dividend, or issued in connection with such merger, consolidation, capital reorganization or recapitalization, shall be added to, and deemed part of, the Restricted Shares for all purposes of this Agreement.  If the Company shall make a distribution of property (other than cash or shares of Common Stock) on any of the Common Stock, or shall distribute with respect to the Common Stock securities of another corporation, such property or securities shall be added to, and deemed part of, the Restricted Shares for all

 

3

 

purposes of this Agreement.  All references in Paragraph 3 hereof to “additional shares of stock, property or securities described in Paragraph 5 or Paragraph 6 hereof,” to “certificates” and to “stock powers” shall be deemed to include, without limitation, reference to any shares, property or securities issued or distributed, as applicable, pursuant to this Paragraph 5 or Paragraph 6 hereof, to certificates or instruments representing any such shares or securities, and to stock powers for such certificates or appropriate instruments of transfer for such instruments, respectively.  Upon the occurrence of any event described in this Paragraph 5, any Restricted Shares that are not Vested shall remain subject to forfeiture to the extent set forth herein, but the provisions hereof shall be appropriately adjusted by the Company so that they will continue to apply with similar effect to any new Restricted Shares resulting from such event.

 

6.                                      Stock Splits, Recapitalizations and Other Events.  If the outstanding shares of the Common Stock shall be subdivided into a greater number of shares or combined into a smaller number of shares, or in the event of a reclassification of the outstanding shares of Common Stock, or if the Company shall be a party to any merger, consolidation, recapitalization or capital reorganization in which securities are issued in exchange for the Restricted Shares, there shall be substituted for the Restricted Shares hereunder such amount and kind of securities as are issued in such subdivision, combination, reclassification, merger, consolidation, recapitalization or capital reorganization with respect to the Restricted Shares outstanding immediately prior thereto and, thereafter, such securities shall for all purposes be deemed the Restricted Shares hereunder.  In any such event, the Restricted Shares that are not Vested shall remain subject to forfeiture to the extent set forth herein, but the provisions hereof shall be appropriately adjusted by the Company so that they will continue to apply with similar effect to such new Restricted Shares.

 

7.                                      No Transfer in Violation of Agreement.  The Company shall not be required to transfer any of the Restricted Shares on its books that shall purportedly have been sold, assigned or otherwise transferred in violation of this Agreement, or to treat as owner of such shares, or to accord the right to vote as such owner or to pay dividends to, any person or entity to which any such shares shall purportedly have been sold, assigned or otherwise transferred in violation of this Agreement.  It is expressly understood and agreed that the restrictions on transfer imposed by this Agreement shall apply not only to voluntary transfers but also to involuntary transfers, by operation of law or otherwise.  The Holder shall pay all legal fees and expenses of the Company arising out of or relating to any purported sale, assignment or transfer of any Restricted Shares in violation of this Agreement.

 

8.                                      Legend.  The certificates representing any shares of the Restricted Shares to be issued to the Holder that are subject to forfeiture shall have endorsed thereon, in addition to any other legends thereon, legends substantially in the following form:

 

The securities represented by this certificate are subject to restrictions on transfer and forfeiture to the Corporation, as set forth in a restricted stock agreement between the Corporation and the registered holder hereof, a copy of which will be provided to the holder hereof by the Corporation upon written request and without charge.

 

9.                                      Severability.  If any provision of this Agreement shall be determined to be invalid, illegal or otherwise unenforceable by any court of competent jurisdiction, the validity, legality and enforceability of the other provisions of this Agreement shall not be affected thereby.  Any

 

4

 

invalid, illegal or unenforceable provision of this Agreement shall be severable, and after any such severance, all other provisions hereof shall remain in full force and effect.

 

10.                               Equitable Relief.  The Holder acknowledges that money damages alone will not adequately compensate the Company for breach of any of the Holder’s covenants and agreements herein and, therefore, agrees that in the event of the breach or threatened breach of any such covenant or agreement, in addition to all other remedies available to the Company, at law, in equity or otherwise, the Company shall be entitled to injunctive relief compelling specific performance of, or other compliance with, the terms hereof.

 

11.                               Tax Matters.  The Holder will be liable for any and all taxes, including, without limitation, withholding taxes, arising out of the grant or the Vesting of the Restricted Shares hereunder, and shall be solely responsible for obtaining such tax treatment of the Restricted Shares and of Holder’s receipt thereof as the Holder may desire, including, without limitation, any timely filing of an election under Section 83(b) of the Internal Revenue Code of 1986, as amended.

 

(a)                                 The Holder will provide the Company with all information that the Company shall request in connection with the Holder’s receipt of the Restricted Shares, and any subsequent sale(s) or other disposition(s) thereof, in order for the Company to satisfy tax, accounting and securities laws reporting and other regulatory requirements.  Information with respect to sale(s) or disposition(s) of Restricted Shares by the Holder should be delivered to the Company before the end of the month within which they occurred.  Information should be provided to the attention of the Company’s General Counsel or, in his absence, to its Chief Financial Officer.

 

(b)                                 Any other provision of this Agreement to the contrary notwithstanding, the Holder shall defend, indemnify and hold the Company harmless from and against any and all damages, costs, expenses, fines, penalties, reasonable attorney’s fees and claims of every kind or nature arising from the Holder’s failure to provide any information required hereunder or to pay any tax amounts promptly and when due.

 

(c)                                  Section 83(b) Tax Election.  The Holder acknowledges that the Company has advised the Holder of the possibility of making an election under Section 83(b) of the Code with respect to the Restricted Shares.  The Holder should consult with his or her tax advisor to determine the tax consequences of acquiring the Restricted Shares and the potential advantages and potential disadvantages of filing the Section 83(b) election in light of the Holder’s individual circumstances.  The Holder acknowledges that it is his or her sole responsibility, and not that of the Company or any of its subsidiaries, to file a timely election under Section 83(b) and that the right to make such an election will be lost if notice of such election is not timely filed.

 

(d)                                 Holder shall, no later than the date as of which the value of any Restricted Shares first becomes includable in the gross income of the Holder for Federal income tax purposes, pay to the Company, or make arrangements satisfactory to the Company regarding payment of any Federal, state, local and/or payroll taxes of any kind required by law to be withheld as a result thereof.  The Company and its affiliates shall, to the extent permitted by law,

 

5

 

have the right to deduct any such taxes from any payment of any kind otherwise due to the Holder.

 

12.                               Notices.  Any notice required or permitted under this Agreement shall be given in writing and shall be deemed effectively given (a) upon personal delivery, (b) on the first business day after being sent by express mail or a nationally recognized overnight courier service, (c) upon transmission by facsimile with receipt confirmed, or (d) on the third business day after being sent by registered or certified mail, return receipt requested, postage prepaid.  To be effective, any such notice shall be addressed, if to the Company, at its principal office, and if to the Holder at the last address of record on the books of the Company or at such other address as such party may designate by ten (10) days prior written notice to the other party hereto.

 

13.                               Benefit of the Agreement.  The rights and obligations of the Holder hereunder are personal to the Holder and, except as otherwise expressly provided herein, such rights and obligations may not be assigned or delegated by the Holder without the prior written consent of the Company.  Any assignment or delegation of such rights and obligations of the Holder absent such consent shall be void and of no force or effect.  This Agreement shall inure to the benefit of, and be binding upon, the legal representatives, successors and assigns of the Company and the heirs, legal representatives, successors and permitted assigns of the Holder, subject to the restrictions on transfer set forth herein.  The rights and remedies of the Company hereunder shall be cumulative and in addition to all other rights and remedies the Company may have, at law, in equity, by contract or otherwise.  No modification, renewal, extension, waiver or termination of this Agreement or any of the provisions herein contained shall be binding upon the Company unless made in writing and signed by a duly authorized officer of the Company.

 

14.                               Choice of Law and Forum.  This Agreement shall be governed by, and construed and enforced in accordance with, the substantive laws of The Commonwealth of Massachusetts without regard to its principles of conflicts of laws.  All litigation arising from or relating to this Agreement shall be filed and prosecuted before any court of competent subject matter jurisdiction located in Boston, Massachusetts.  The Holder consents to the jurisdiction of such courts over him, stipulates to the convenience, efficiency and fairness of proceeding in such courts, and covenants not to allege or assert the inconvenience, inefficiency or unfairness of proceeding in such courts.

 

15.                               Fractional Shares.  Any fractional shares resulting from a computation of the Vested Restricted Shares made pursuant to Paragraph 2 hereof shall be rounded down to the nearest whole share.

 

16.                               No Right To Employment/Provide Services.  Nothing contained in this Agreement shall be construed as giving the Holder any right to be retained in any position as an employee of, or to provide or continue to provide services to, the Company.

 

17.                               Entire Agreement.  This Agreement, the Plan and the other documents referred to herein constitute the entire agreement between the parties with respect to the subject matter of this Agreement, and supersede all prior agreements and understandings, written and oral, with respect thereto.

 

6

 

18.                               Construction.  The genders and numbers used in this Agreement are used as reference terms only and shall apply with the same effect whether the parties are of the masculine, neuter or feminine gender, corporate or other form, and the singular shall likewise include the plural.

 

*                                         *                                         *

 

7

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00280-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00280-of-00352.parquet"}]]