Document:

ex_174567.htm

 

Exhibit 10.40

 

DESCRIPTION OF CAPITAL STOCK

 

The following is a summary of all material characteristics of the capital stock of Maui Land & Pineapple Company, Inc. (“we,” “our” or “us”) as set forth in our articles of association, as restated, or our Charter, and our bylaws, as amended, or our Bylaws. The summary does not purport to be complete and is qualified in its entirety by reference to our Charter and our Bylaws, copies of which have been filed as exhibits to our filings with the Securities and Exchange Commission.

 

Common Stock

 

General. We may issue shares of our common stock from time to time. We are currently authorized to issue 43,000,000 shares of common stock, with no par value per share.

 

Dividend Rights. Holders of common stock are entitled to receive such dividends as may be declared by the board of directors out of funds legally available therefor.

 

Voting Rights. The holders of our common stock are entitled to one vote for each share held of record on all matters submitted to a vote of the stockholders. The holders of common stock are not entitled to cumulative voting rights with respect to the election of directors, and as a consequence, minority stockholders will not be able to elect directors on the basis of their votes alone.

 

No Preemptive, Conversion or Similar Rights. Holders of common stock have no preemptive rights and no right to convert their common stock into any other securities.

 

Right to Receive Liquidation Distributions. In the event of a liquidation, dissolution or winding up, holders of the common stock are entitled to share ratably in all assets remaining after payment of all outstanding debt and liabilities.

 

Hawaii Law and Certain Certificate of Incorporation and Bylaw Provisions

 

The provisions of Hawaii law, our Charter and our Bylaws may have the effect of delaying, deferring or discouraging another person from acquiring control of us by means of a tender offer, a proxy contest or otherwise, or removing incumbent officers and directors. These provisions, summarized below, are expected to discourage certain types of coercive takeover practices and takeover bids that our board of directors may consider inadequate and to encourage any person seeking to acquire control of us to first negotiate with our board of directors.

 

Unanimous Shareholder Action by Written Consent; Special Meetings

 

Any action required or permitted to be taken by our shareholders must be effected at a duly called annual or special meeting of our shareholders or, as provided in Section 414-124 of the Hawaii Business Corporation Act, or HBCA, by unanimous written consent in lieu of a meeting. Further, our Bylaws provide that special meetings may be called only the President or any two directors or the holders of not less than one-fourth of our capital stock issued and outstanding and entitled to vote as such special meeting.

 

Certain Provisions of the HBCA and Other Hawaii Statutes

 

As a Hawaii corporation, we are governed by the HBCA and more broadly the Hawaii Revised Statutes, or the HRS. The provisions of the HRS summarized below may delay, deter or prevent unsolicited acquisitions or changes of control of our Company, including transactions that might result in a premium being paid over the market price for shares of our common stock or that some shareholders might otherwise consider to be in their best interests.

 

 

 

 

Control Share Acquisitions. 

 

Under Chapter 414E of the HRS, a person who proposes to make a “control share acquisition” in an “issuing public corporation” must obtain approval of the acquisition, in the manner specified in Section 414E-2 of the HRS, by the affirmative vote of the holders of a majority of the voting power of all shares entitled to vote, exclusive of the shares beneficially owned by the acquiring person, and must consummate the proposed control share acquisition within 180 days after shareholder approval. If a control share acquisition is made without the requisite shareholder approval, the statute provides that (i) the shares acquired may not be voted for a period of one year from the date of acquisition and (ii) the shares will be nontransferable on the corporation’s books for one year after acquisition and the corporation, during the one-year period, has the right to call the shares for redemption either at the price at which the shares were acquired or at book value per share as of the last day of the fiscal quarter ended prior to the date of the call for redemption.

 

Under Chapter 414E of the HRS, “control share acquisition” means, subject to specified exceptions, the acquisition of shares of an issuing public corporation resulting in beneficial ownership of the acquiring person of one of the following ranges of voting power in the election of directors:

 

•At least ten percent but less than twenty percent;

 

•At least twenty percent but less than thirty percent;

 

•At least thirty percent but less than forty percent;

 

•At least forty percent but less than a majority; or

 

•At least a majority.

 

Acquisitions that are approved by resolution of the board of directors before the acquisition occurs and acquisitions that the board of directors of the issuing public corporation determines, by resolution before the acquisition occurs, does not constitute a control share acquisition are not subject to the foregoing requirements.

 

An “issuing public corporation” means a corporation incorporated in Hawaii which has (i) 100 or more shareholders and (ii) its principal place of business or its principal office in Hawaii, or that has substantial assets located in Hawaii.

 

Corporate Take-Overs.

 

Chapter 417E of the HRS, the Hawaii Corporate Take-Overs Act (the “HCTA”), generally applies to take-over offers made to residents of the State of Hawaii in cases where the offeror would become the beneficial owner of more than 10% of any class of equity securities of a target company, or where an offeror that already owns more than 10% of any class of equity securities of the target company would increase its beneficial ownership by more than 5% (subject to certain exceptions). Under the HCTA, no offeror may acquire from any Hawaii resident equity securities of a target company at any time within two years following the last purchase of securities pursuant to a take-over offer with respect to the same class of securities, including but not limited to acquisitions made by purchase, exchange, merger, consolidation, partial or complete liquidation, redemption, reverse stock split, recapitalization, reorganization, or any other similar transaction, unless the holders of the equity securities are afforded, at the time of the acquisition, a reasonable opportunity to dispose of the securities to the offeror upon substantially equivalent terms as those provided in the earlier take-over offer. The HCTA requires that any person making a take-over offer file a registration statement with the Hawaii Commissioner of Securities and comply with certain other procedural requirements.

 

A “take-over offer” is an offer to acquire any equity securities of a target company from a Hawaii resident pursuant to a tender offer or request or invitation for tenders.

 

A “target company” is an issuer of publicly traded equity securities that is organized under the laws of the State of Hawaii or has at least 20% of its equity securities beneficially held by Hawaii residents and has substantial assets in Hawaii.

 

The HCTA does not apply if the offer has been approved in writing by the board of directors of the target company, if the offeror is the issuer of the securities, if the offeror does not acquire more than 2% of any class of equity securities of the issuer during the preceding 12 month period, or if the offer involves an exchange of securities that is registered or exempt from registration under the HCTA.

 

 

 

 

Charter and Bylaw Provisions. Our Charter and our Bylaws also include a number of other provisions that may have the effect of deterring hostile takeovers or delaying or preventing changes in control or our management as follows:

 

	 	
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			Our Bylaws provide that all stockholder action must be effected at a duly called meeting of stockholders and not by a consent in writing.

			

 

	 	
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			Our Bylaws provide that stockholders seeking to present proposals before a meeting of stockholders, or to nominate candidates for election as directors at a meeting of stockholders, must provide timely notice in writing. Our Bylaws also specify requirements as to the form and content of a stockholder’s notice. These provisions may delay or preclude stockholders from bringing matters before a meeting of stockholders or from making nominations for directors at a meeting of stockholders, which could delay or deter takeover attempts or changes in management.

			

 

	 	
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			Our Bylaws provide that all vacancies, including newly created directorships, may, except as otherwise required by law, be filled by the affirmative vote of a majority of our directors then in office, even if less than a quorum, if not filled by the stockholders holding a majority of the shares of all capital stock in the case of a director removal at a special meeting of stockholders.Exhibit

Exhibit 10.107

HEXION HOLDINGS CORPORATION
2020 INCENTIVE COMPENSATION PLAN (the “Plan”)

Purpose of the Plan
The Plan is sponsored by Hexion Holdings Corporation (“Hexion Holdings”) to reward associates of Hexion Inc. (“Hexion”) and its subsidiaries for delivering increased value by profitably growing the business and controlling costs. The Plan is designed to link rewards with critical financial metrics for the purpose of promoting actions which are the most beneficial to Hexion’s short-term and long-term value creation.
Administration
The Plan shall be administered by and awards under the Plan shall be authorized by the Compensation Committee (the “Committee”) of Hexion Holdings’ Board of Directors (the “Board”).  The Committee may delegate some of its authority under the Plan to management or as is otherwise stated in the Plan.  The Committee has the right to amend or terminate this Plan at any time.
Plan Year
January 1, 2020 - December 31, 2020
Eligibility for Participation
Participation is based on each associate's scope of responsibility and contribution to the organization. Each participant has a plan assignment of Corporate, Corporate-BU Blended (Global Hexion plus Business Unit) or Business Unit.
Plan Performance Measures
The Plan performance measures are based on three performance criteria:  EBITDA, EH&S and Cash Flow.
EBITDA
EBITDA refers to Earnings before Interest, Taxes, Depreciation and Amortization, adjusted to exclude (i) certain non-cash items, (ii) certain other income and expenses and (iii) discontinued operations. EBITDA is a critical measure on which the investment community and future shareholders will evaluate Hexion's performance. As a result, participants should be focused and incented to manage the business to achieve EBITDA targets.
EBITDA will be measured for Global Hexion and for each specified Hexion Business Unit. Participants have a total of sixty-five (65) percent of their incentive target based on the achievement of EBITDA targets. EBITDA achievement measured for Global Hexion and each specified Business Unit may exclude certain unusual, non-recurring items at the discretion of the Committee.
Environmental Health and Safety (EH&S)
EH&S measures environmental and safety results including (i) SIFs – severe incident factors, (ii) OIIR – occupational illness and injury rate and (iii) total environmental events (ERI).  EH&S will be measured for Global Hexion.
Participants have a total of ten (10) percent of their incentive target based on the achievement of EH&S goals – five (5) percent for SIF’s and two and one-half (2.5) percent each for OIIR and ERI.
New in 2020: In the definition of total environmental events, Hexion Reportable Release is being replaced by PSI Tier 2 Spill (which is a Loss of Primary Containment that meets the Tier 2 threshold quantity as defined by the Center for Chemical Process Safety (CCPS)).  Total environmental incidents will still include Top Level Environmental Events (federally reportable releases and permit exceedances).
Cash Flow
Cash Flow represents the amount of cash generated by business operations. Cash flow is defined as EBITDA, net trading capital improvement and/or usage, capital spending and interest paid along with other operating cash flow items such as income taxes paid and pension contributions. The purpose of this component is to focus on cost control and cost reduction actions to preserve an 

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adequate amount of liquidity to fund operations and capital expenditures, service debt, and ultimately sustain the business through difficult economic cycles.
Cash Flow will be measured for Global Hexion, and may exclude certain unusual, non-recurring items at the discretion of the Committee.
Participants have a total of twenty-five (25) percent of their incentive target based on the achievement of Cash Flow targets.

New in 2020: Free Cash Flow has been replaced with Cash Flow from Operations.
Target Incentive
Each participant will have a target incentive opportunity expressed as a percent of his or her base salary. Plan assignments and targets are determined by the associate's business responsibilities and scope of his or her role and contributions within the organization.
Plan Structure
The following tables depict the structure described above.
	
				
	Plan Level
	EBITDA
	EH&S
	Cash Flow

	Corporate
	65% Global Hexion
	10% Global Hexion
	25% Global Hexion

	Corporate-BU Blended
	35% Global Hexion
10% Global Resins
10% Global Epoxy
10% Global Formaldehyde
	10% Global Hexion
	25% Global Hexion

	Business Unit1
	32.5% Global Hexion
32.5% Business Unit
	10% Global Hexion
	25% Global Hexion

		
	 (1) 
	Business Unit shall refer to the applicable business unit plan assignment as determined by the Committee.

Calculation of Incentive Payments
Payment based on the EBITDA measure will range from a minimum of one (1) percent of the EBITDA incentive opportunity to a maximum of 200 percent of the EBITDA incentive opportunity based on applicable EBITDA achievement. Payment based on the Cash Flow measure will range from a minimum of one (1) percent of the Cash Flow incentive opportunity to a maximum of 200 percent of the Cash Flow incentive opportunity based on applicable Cash Flow achievement. Payment based on the EH&S measures will range from 30 percent of the applicable EH&S incentive opportunity to a maximum of 200 percent of the applicable EH&S incentive opportunity based on the applicable EH&S achievement. There will be no payout based on EH&S achievement if, during the plan year, any incident at a Hexion site results in a fatality.
Calculation of EBITDA performance between the minimum and target performance levels and the target and maximum performance levels will be linear, rounded to the nearest 1/10th of one percent. There is no additional payment made for performance above the maximum level of performance.
Each of the performance measures is evaluated independently such that a payout for achieving one performance measure is not dependent upon the achievement of any other performance measure.

Basis for Award Payouts
Financial Results
Any Plan payouts require the prior approval of the Chairs of the Audit and Compensation Committees of the Board if they are to be made before audited financial results have been formally approved and publicly announced.
Plan Assignments

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Any change in a participant’s plan assignment that is not related to a job transfer must be approved by an appropriate Vice President. Plan assignments for each associate are audited at the start of the plan year to conform to any additions or removals of plan assignments.
Limitations
The Committee may elect to modify the calculation of the annual targets based on acquisitions, divestitures or other unusual, non-recurring events or transactions that occur during the plan year.
Eligibility Requirement
To receive an incentive payment, a plan participant must be actively employed by Hexion on the final day of the Plan Year.
Payments
Generally, payouts under the Plan are made no later than the last payroll period in April following
the end of the Plan Year. Incentive payments are subject to applicable taxes, garnishment, and
wage orders. If a plan participant is on a leave of absence at the time of payout, the award will
be paid at the same time as other plan participants.
Proration of Payments
Proration of payments will be made on a daily basis. A participant's incentive payment will be prorated for any of the following conditions:
		
	a.
	New Hires:  Awards to participants who commenced employment during the Plan Year will be prorated. Rehires are considered new hires, when an associate terminates and is rehired in the same plan year.

		
	b.
	Salary: Awards will be calculated based on the participant's base salary as of July 1st. Awards to participants whose base salary changes after July 1 will be prorated. Changes to part-time status will be adjusted for accordingly.

		
	c.
	Job Changes or Transfers:

		
	1.
	Awards to participants who experience a job change or transfer during the Plan Year—which results in a different ICP target or plan assignment—will be prorated.

		
	2.
	In the event of currency change, the payment will be made in the currency of record on of 12/31.

		
	d.
	Leaves of Absence: For approved leaves of absence that exceed 12 cumulative weeks (84 days), the amount of time not worked beyond the 12 weeks will be excluded from the Plan Year and the associate will receive a prorated incentive.

The Plan remains at the total discretion of the Committee. Hexion Holdings retains the right to amend or adapt the design and rules of the Plan. Local laws will prevail where necessary.

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