Document:

exhibit104formofretentio

                                                                        Exhibit 10.4                               Form of Retention Award Agreement    [Date], 2018        [Employee Name]  [Street Address]  [City, State and Zip Code]    Re:    Cash Incentive Award    Dear [Employee Name]:                                   APX Group, Inc. (the “Company”) is pleased to offer a cash incentive award to you to remain employed  with the Company because we recognize that you are critical to the success of our future business  operations and that you have the potential to make a significant impact on our future growth and  financial performance.      In addition to your salary and other benefits, you will be eligible to receive a retention bonus in the  aggregate amount of $[_____], less applicable withholding taxes, payable as follows:  (i) $[_____] payable  on [August 3], 2018; (ii) $[_____] payable on [August 3], 2019; and (iii) $[_____] payable on [August 3],  2020.  Each of the payments described above shall be conditioned on your continued employment with  the Company (or one or more of its subsidiaries) through the dates listed above and your performance  remaining in good standing, as determined in good faith by the Board of Directors of the Company.      In the event your employment is terminated by the Company other than for Cause (as defined below),  including due to death or disability, prior to any remaining payment date, you will receive the full  remaining amount of the retention bonus, payable within 2-1⁄2 months following your termination date  subject to your (or your estate’s, as applicable), execution of an effective release of claims in favor of the  Company.  However, you will not be entitled to receive any remaining amount of the retention bonus if  (i) you terminate your employment with the Company for any reason, or (ii) your employment is  terminated by the Company for Cause, in either case at any time prior to the applicable eligibility date  set forth above.    For purposes of this Agreement, “Cause” shall have the meaning ascribed to such term in your  employment agreement with the Company or one of its affiliates and if not so defined, or no such  agreement exists, shall mean (A) your continued failure substantially to perform your employment  duties (other than as a result of total or partial incapacity due to physical or mental illness), (B)  dishonesty in the performance of your employment duties, (C) an act or acts on your part constituting  what would be classified as (x) a felony under the laws of the United States or any state thereof or (y) a  misdemeanor involving moral turpitude under the laws of the United States or any state thereof, (D)  your use, possession, sale, or purchase of controlled substance or alcohol during working hours or on  the job site or being under the influence of controlled substances or alcohol during working hours or on  the job site, (E) your willful malfeasance or willful misconduct in connection with your employment  duties or any act or omission which is or could be reasonably expected to be injurious to the financial  condition or business reputation of the Company or any of its subsidiaries or affiliates, (F) your fraud or  misappropriation, embezzlement or misuse of funds or property belong to the Company or any of its  subsidiaries or affiliates or (G) your breach of any provision of any agreement including, but not limited  to, any employment agreement or equity award agreement with the Company or any of its subsidiaries      

 

or affiliates (whether currently in existence or arising in the future from time to time) containing  covenants regarding non-competition, non-solicitation, non-disparagement and/or non-disclosure  obligations; provided that none of the foregoing events shall constitute Cause unless you fail to cure such  event and remedy any adverse or injurious consequences arising from such events within 10 days after  receipt from the Company of written notice of the event which constitutes Cause (except that no cure or  remedy period shall be provided if the event or such consequences are not capable of being cured and  remedied).    You and the Company agree that your employment with the Company is and will continue to be “at-will”  and may be terminated at any time with or without Cause or notice by either you or the Company.  No  provision of this letter shall be construed as conferring upon you a right to continue as an employee of  the Company or any of its subsidiaries or affiliates.    Notwithstanding anything to the contrary herein, it is the intent of the parties hereto that the payments  under this letter agreement comply with or be exempt from Section 409A of the Internal Revenue Code  of 1986, as amended, and any successor thereto (the “Code”), and, accordingly, to the maximum extent  permitted, this letter agreement shall be interpreted to be in compliance therewith.  If any provision of  this letter agreement would cause you to incur any additional tax or interest under Section 409A of the  Code, the Company shall, in good faith and to the extent able, reform such provision in a manner  intended to avoid the incurrence by you of any such additional tax or interest.    This letter and all rights pursuant to it shall be binding upon, inure to the benefit of and be enforceable  by the parties hereto and their respective personal or legal representatives, executors, administrators,  heirs, distributees, devisees, legatees, successors and assigns.  This letter shall be governed by and  construed in accordance with the internal substantive laws, but not the choice of law rules, of the State  of Utah.    The content of this letter is personal and confidential between you and the Company.  The Company’s  expectations are that you will respect the sensitive nature of this correspondence and not disclose it to  any other employee or manager of the Company.    To indicate your acceptance of the terms of this letter, please sign and date this letter in the space  provided below and return it to Starr Fowler - Senior Vice President, Human Resources.  A duplicate  original is enclosed for your records.  This letter, along with your existing employment agreement, if  any, and the agreement relating to proprietary rights between you and the Company, set forth the terms  of your employment with the Company and supersede any prior representations or agreements,  whether written or oral.  This letter may not be modified or amended except by a written agreement,  signed by you and an authorized officer of the Company.    Sincerely,      Alex Dunn                                       President                                       APX Group, Inc.                                                                                                                                                                                          ACCEPTED AND AGREED TO                                                    this ______ day of ___________, 2018                                                                                                                                                      ___________________________________                                                     [Name]  cc:   Starr Fowler - SVP, Human Resources                                                                                  Page 2 of 2  

 

                      Page 2 of 2exhibit105vivintgroupinc

                                                                     Exhibit 10.5                                                                                                              VIVINT GROUP, INC.                           AMENDED AND RESTATED                         2013 OMNIBUS INCENTIVE PLAN         1.    Purpose.  The purpose of the Vivint Group, Inc. Amended and Restated 2013  Omnibus Incentive Plan is to provide a means through which Vivint Group, Inc. (the  “Company”) and its Affiliates may attract and retain key personnel and to provide a means  whereby directors, officers, employees, consultants and advisors (and prospective directors,  officers, employees, consultants and advisors) of the Company and its Affiliates can acquire and  maintain an equity interest in the Company, or be paid incentive compensation, including  incentive compensation measured by reference to the value of shares of Common Stock, thereby  strengthening their commitment to the welfare of the Company and its Affiliates and aligning  their interests with those of the Company’s stockholders.           2.    Definitions.  The following definitions shall be applicable throughout the Plan.         (a)   “Absolute Share Limit” has the meaning given such term in Section 5(b).         (b)   “Affiliate” means (i) any person or entity that directly or indirectly controls, is  controlled by or is under common control with the Company and/or (ii) to the extent provided  by the Committee, any person or entity in which the Company has a significant interest.  The  term “control” (including, with correlative meaning, the terms “controlled by” and “under  common control with”), as applied to any person or entity, means the possession, directly or  indirectly, of the power to direct or cause the direction of the management and policies of such  person or entity, whether through the ownership of voting or other securities, by contract or  otherwise.         (c)    “Award” means, individually or collectively, any Incentive Stock Option,  Nonqualified Stock Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Unit,  Other Stock-Based Award and Performance Compensation Award granted under the Plan.           (d)   “Board” means the Board of Directors of the Company.         (e)   “Cause” means, in the case of a particular Award, unless the applicable Award  agreement states otherwise, shall have the meaning ascribed to such term in the Participant’s  then-current Employment Agreement,  and if not so defined, or no such Employment  Agreement exists, “Cause” shall mean (A) the Participant’s continued failure substantially to  perform the Participant’s employment duties (other than as a result of total or partial incapacity  due to physical or mental illness), (B) dishonesty in the performance of the Participant’s  employment duties, (C) an act or acts on the Participant’s part constituting (x) what would be  classified as a felony under the laws of the United States or any state thereof or (y) what would  be classified as a misdemeanor involving moral turpitude under the law of the United States or  any state thereof, (D) use, possession, sale, or purchase of controlled substances or alcohol  during working hours or on the job site or being under the influence of controlled substances or  alcohol during working hours or on the job site, (E) the Participant’s willful malfeasance or  willful misconduct in connection with the Participant’s employment duties or any act or    001366-0016-13471-Active.16178760.5  

 

                                                                             2    omission which is or could reasonably be expected to be injurious to the financial condition or  business reputation of the Company or any of its Subsidiaries or Affiliates, (F) the Participant’s  fraud or misappropriation, embezzlement or misuse of funds or property belonging to the  Company or an Affiliate or Subsidiary or (G) the occurrence of any Restrictive Covenant  Violation; provided, that none of the foregoing events shall constitute Cause unless Participant  fails to cure such event and remedy any adverse or injurious consequences arising from such  event within 10 days after the receipt of written notice from the Company of the event which  constitutes Cause (except that no cure or remedy period shall be provided if the event or such  consequences are not capable of being cured and remedied).         (f)   “Change of Control” shall mean (i) the sale or disposition, in one or a series of  related transactions, of all or substantially all of the assets of the Company and its Subsidiaries,  as a whole, to any Person or Group other than Parent or (ii) any Person or Group, other than  Parent, is or becomes the “beneficial owner” (as such term is defined in Rules 13d-3 and 13d-5  under the Exchange Act (or any successor rule thereto)), directly or indirectly, of 50% or more  of the total voting power of the voting equity of the Company, including by way of merger,  consolidation or otherwise and Parent ceases to directly or indirectly control the Board.         (g)   “Code” means the Internal Revenue Code of 1986, as amended, and any successor  thereto.  Reference in the Plan to any section of the Code shall be deemed to include any  regulations or other interpretative guidance under such section, and any amendments or  successor provisions to such section, regulations or guidance.         (h)   “Committee” means (i) prior to a Public Offering, the Compensation Committee  of the Parent Board or such other committee of the Parent Board (including, without limitation,  the full Parent Board) to which the Parent Board has delegated power to act under or pursuant to  the provisions of the Plan, and (ii) following (A) a Public Offering or (B) the date Parent ceases  to be the “beneficial owner” (as such term is defined in Rules 13d-3 and 13d-5 under the  Exchange Act (or any successor rule thereto)), directly or indirectly, of 80% or more of the total  voting power of the voting equity of the Company, the Compensation Committee of the Board  or such other committee of the Board (including, without limitation, the full Board) to which the  Board has delegated power to act under or pursuant to the provisions of the Plan, or any  subcommittee thereof if required with respect to actions taken to comply with Section 162(m) of  the Code in respect of Awards, and if no such committee or subcommittee thereof exists, the  Board.         (i)   “Common Stock” means the common stock, par value $0.01 per share, of the  Company (and any stock or other securities into which such Common Stock may be converted  or into which it may be exchanged).         (j)   “Company” means Vivint Group, Inc., a Utah corporation, and any successor  thereto.         (k)   “Date of Grant” means the date on which the granting of an Award is authorized,  or such other date as may be specified in such authorization.    001366-0016-13471-Active.16178760.5  

 

                                                                             3          (l)   “Designated Foreign Subsidiaries” means all Affiliates organized under the laws  of any jurisdiction or country other than the United States of America that may be designated by  the Board or the Committee from time to time.         (m)   “Disability” means, unless in the case of a particular Award the applicable Award  agreement states otherwise, shall have the meaning ascribed to such term in the Participant’s  Employment Agreement, and if not so defined, or if no such Employment Agreement exists,  “Disability” shall mean the Participant’s inability, for a period of six (6) consecutive months or  for an aggregate of twelve (12) months in any twenty-four (24) consecutive month period, to  perform Executive’s employment duties as a result of the Executive becoming physically or  mentally incapacitated, as determined in good faith by the Board.  Any determination of  whether Disability exists shall be made by the Committee in its sole discretion.         (n)   “Effective Date” means July 1, 2013.         (o)   “Eligible Director” means a person who is (i) a “non-employee director” within  the meaning of Rule 16b-3 under the Exchange Act, (ii) an “outside director” within the  meaning of Section 162(m) of the Code and (iii) an “independent director” under the rules of  any securities exchange or inter-dealer quotation system on which the shares of Common Stock  is listed or quoted, or a person meeting any similar requirement under any similar rule or  regulation.         (p)   “Eligible Person” means any (i) individual employed by the Company or an  Affiliate; provided, however, that no such employee covered by a collective bargaining  agreement shall be an Eligible Person unless and to the extent that such eligibility is set forth in  such collective bargaining agreement or in an agreement or instrument relating thereto; (ii)  director or officer of the Company or an Affiliate; (iii) consultant or advisor to the Company or  an Affiliate who may be offered securities registrable pursuant to a registration statement on  Form S-8 under the Securities Act; or (iv) any prospective employees, directors, officers,  consultants or advisors who have accepted offers of employment or consultancy from the  Company or its Affiliates (and would satisfy the provisions of clauses (i) through (iii) above  once he or she begins employment with or providing services to the Company or its Affiliates),  who, in the case of each of clauses (i) through (iv) above has entered into an Award agreement  or who has received written notification from the Committee or its designee that they have been  selected to participate in the Plan.  Solely for purposes of this Section 2(p), “Affiliate” shall be  limited to (1) a Subsidiary, (2) any Parent Corporation, (3) any corporation, trade or business  50% or more of the combined voting power of such entity’s outstanding securities is directly or  indirectly controlled by the Company or any Subsidiary or Parent Corporation, (4) any  corporation, trade or business which directly or indirectly controls 50% or more of the  combined voting power of the outstanding securities of the Company and (5) any other entity in  which the Company or any Subsidiary or Parent Corporation has a material equity interest and  which is designated as an “Affiliate” by the Committee.         (q)   “Employment” means (i) a Participant’s employment if the Participant is an  employee of the Company or any of its Affiliates or Subsidiaries (or Parent or one of its  Subsidiaries), (ii) a Participant’s services as an advisor, if the Participant is an advisor to the  Company or any of its Affiliates or Subsidiaries (or Parent or one of its Subsidiaries), and (iii) a    001366-0016-13471-Active.16178760.5  

 

                                                                             4    Participant’s services as a non-employee director, if the Participant is a non-employee member  of the Board or Parent Board.         (r)   “Employment Agreement” means the employment agreement entered into by  and between the Participant and the Company or one of its Affiliates or Subsidiaries, as may be  amended, modified or supplemented from time to time.         (s)   “Exchange Act” means the Securities Exchange Act of 1934, as amended, and  any successor thereto.  Reference in the Plan to any section of (or rule promulgated under) the  Exchange Act shall be deemed to include any rules, regulations or other interpretative guidance  under such section or rule, and any amendments or successor provisions to such section, rules,  regulations or guidance.         (t)   “Exercise Price” means the exercise price per share of Common Stock for each  Option.          (u)   “Fair Market Value” means, on a given date, (i) if the Common Stock is listed on  a national securities exchange, the closing price of the Common Stock reported on the primary  exchange on which the Common Stock is listed and traded on such date, or, if there are no such  sales on that date, then on the last preceding date on which such sales were reported; (ii) if the  Common Stock is not listed on any national securities exchange but is quoted in an inter-dealer  quotation system on a last-sale basis, the average between the closing bid price and ask price  reported on such date, or, if there is no such sale on that date, then on the last preceding date on  which a sale was reported; or (iii) if the Common Stock is not listed on a national securities  exchange or quoted in an inter-dealer quotation system on a last-sale basis, the amount  determined by the Parent Board (or, after a Public Offering, the Committee) in good faith to be  the fair market value of the Common Stock.         (v)   “Group” means “group” as such term is used for purposes of Section 13(d) or  14(d) of the Exchange Act (or any successor section thereto).         (w)   “Immediate Family Member” means any person who is a “family member” of the  Participant, as such term is used in the instructions to Form S-8 under the Securities Act or any  successor form of registration statement promulgated by the Securities and Exchange  Commission.          (x)   “Incentive Stock Option” means an Option which is designated by the Committee  as an incentive stock option as described in Section 422 of the Code and otherwise meets the  requirements set forth in the Plan.         (y)   “Indemnifiable Person” shall have the meaning set forth in Section 4(e) of the  Plan.         (z)   “Negative Discretion” shall mean the discretion authorized by the Plan to be  applied by the Committee to eliminate or reduce the size of a Performance Compensation  Award consistent with Section 162(m) of the Code.    001366-0016-13471-Active.16178760.5  

 

                                                                             5          (aa)  “Nonqualified Stock Option” means an Option which is not designated by the  Committee as an Incentive Stock Option.         (bb)  “Non-Employee Director” means a member of the Board who is not an employee  of the Company or any Affiliate or Subsidiary.         (cc)  “Option” means an Award granted under Section 7 of the Plan.         (dd)  “Option Period” has the meaning given such term in Section 7(c) of the Plan.         (ee)  “Other Stock-Based Award” means an Award granted under Section 10 of the  Plan.         (ff)  “Parent” means 313 Acquisition LLC, a Delaware limited liability company.         (gg)  “Parent Board” means the Board of Managers of Parent.         (hh)  “Parent Corporation” means any parent corporation of the Company within the  meaning of Section 424(e) of the Code.         (ii)  “Participant” means an Eligible Person who has been selected by the Committee  to participate in the Plan and to receive an Award pursuant to the Plan.         (jj)  “Performance Compensation Award” shall mean any Award designated by the  Committee as a Performance Compensation Award pursuant to Section 11 of the Plan.         (kk)  “Performance Criteria” shall mean the criterion or criteria that the Committee  shall select for purposes of establishing the Performance Goals for a Performance Period with  respect to any Performance Compensation Award under the Plan.         (ll)  “Performance Formula” shall mean, for a Performance Period, the one or more  objective formulae applied against the relevant Performance Goal to determine, with regard to  the Performance Compensation Award of a particular Participant, whether all, some portion but  less than all, or none of the Performance Compensation Award has been earned for the  Performance Period.         (mm)  “Performance Goals” shall mean, for a Performance Period, the one or more goals  established by the Committee for the Performance Period based upon the Performance Criteria.         (nn)  “Performance Period” shall mean the one or more periods of time of not less than  twelve (12) months, as the Committee may select, over which the attainment of one or more  Performance Goals will be measured for the purpose of determining a Participant’s right to, and  the payment of, a Performance Compensation Award.         (oo)  “Permitted Transferee” shall have the meaning set forth in Section 14(b) of the  Plan.    001366-0016-13471-Active.16178760.5  

 

                                                                             6          (pp)  “Person” means any individual, entity or group (within the meaning of Section  13(d)(3) or 14(d)(2) of the Exchange Act.         (qq)  “Plan” means this Vivint Group, Inc. Amended and Restated 2013 Omnibus  Incentive Plan.         (rr)  “Public Offering” means a sale of shares of Common Stock of the Company, any  parent entity owning 100% of the shares of Common Stock of the Company, or any Subsidiary  of the Company owning all or substantially all of the assets of the Company and its Subsidiaries  to the public in an underwritten offering pursuant to an effective registration statement filed  with the SEC pursuant to the Securities Act, provided that a Public Offering shall not include an  offering made in connection with a business acquisition or combination or an employee benefit  plan.         (ss)  “Restricted Period” means the period of time determined by the Committee  during which an Award is subject to restrictions or, as applicable, the period of time within  which performance is measured for purposes of determining whether an Award has been  earned.         (tt)  “Restricted Stock” means Common Stock, subject to certain specified restrictions  (including, without limitation, a requirement that the Participant remain continuously employed  or provide continuous services for a specified period of time), granted under Section 9 of the  Plan.         (uu)  “Restricted Stock Unit” means an unfunded and unsecured promise to deliver  shares of Common Stock, cash, other securities or other property, subject to certain restrictions  (including, without limitation, a requirement that the Participant remain continuously employed  or provide continuous services for a specified period of time), granted under Section 9 of the  Plan.         (vv)  “Restrictive Covenant Violation” means the Participant’s breach of any provision  of any agreement (including any Award agreement) with Parent, the Company or any of their  respective Affiliates or Subsidiaries (whether currently in existence or arising in the future from  time to time, and whether entered into pursuant to the Plan or otherwise) containing covenants  regarding non-competition, non-solicitation, non-disparagement and/or non-disclosure  obligations (collectively, “Restrictive Covenants”).         (ww)  “SAR Period” has the meaning given such term in Section 8(c) of the Plan.         (xx)  “Securities Act” means the Securities Act of 1933, as amended, and any successor  thereto.  Reference in the Plan to any section of (or rule promulgated under) the Securities Act  shall be deemed to include any rules, regulations or other interpretative guidance under such  section or rule, and any amendments or successor provisions to such section, rules, regulations  or guidance.         (yy)  “Service Recipient” means, with respect to a Participant holding a given Award,  either the Company or an Affiliate or Subsidiary of the Company by which the original  recipient of such Award is, or following a Termination was most recently, principally employed    001366-0016-13471-Active.16178760.5  

 

                                                                             7    or to which such original recipient provides, or following a Termination was most recently  providing, services, as applicable.         (zz)  “Stock Appreciation Right” or “SAR” means an Award granted under Section 8  of the Plan.         (aaa) “Stockholders’ Agreement” means any agreement of one or more stockholders of  the Company (or the issuer of Alternative Equity) designated as a “Management Stockholders  Agreement” by the Committee from time to time, as may be amended or supplemented from  time to time in accordance with the terms thereof.         (bbb) “Strike Price” means the strike price per share of Common Stock for each SAR.         (ccc) “Subsidiary” means, with respect to any specified Person:               (i)   any corporation, limited liability corporation, association or other business        entity of which more than 50% of the total voting power of shares of such entity’s voting        securities (without regard to the occurrence of any contingency and after giving effect to        any voting agreement or stockholders’ agreement that effectively transfers voting power)        is at the time owned or controlled, directly or indirectly, by that Person or one or more of        the other Subsidiaries of that Person (or a combination thereof); and               (ii)  any partnership (or any comparable foreign entity) (A) the sole general        partner (or functional equivalent thereof) or the managing general partner of which is        such Person or Subsidiary of such Person or (B) the only general partners (or functional        equivalents thereof) of which are that Person or one or more Subsidiaries of that Person        (or any combination thereof).         (ddd) “Substitute Award” has the meaning given such term in Section 5(e).         (eee) “Sub Plans” means, any sub-plan to this Plan that has been adopted by the Board  or the Committee for the purpose of permitting the offering of Awards to employees of certain  Designated Foreign Subsidiaries or otherwise outside the United States of America, with each  such sub-plan designed to comply with local laws applicable to offerings in such foreign  jurisdictions.  Although any Sub Plan may be designated a separate and independent plan from  the Plan in order to comply with applicable local laws, the Absolute Share Limit shall apply in  the aggregate to the Plan and any Sub Plan adopted hereunder.         (fff) “Termination” means the termination of a Participant’s employment or service,  as applicable, with the Service Recipient.           3.    Effective Date; Duration.  The Plan shall be effective as of the Effective Date.   The expiration date of the Plan, on and after which date no Awards may be granted hereunder,  shall be the tenth (10th) anniversary of the Effective Date; provided, however, that such  expiration shall not affect Awards then outstanding, and the terms and conditions of the Plan  shall continue to apply to such Awards.         4.    Administration.      001366-0016-13471-Active.16178760.5  

 

                                                                             8          (a)   The Committee shall administer the Plan.  To the extent required to comply with  the provisions of Rule 16b-3 promulgated under the Exchange Act (if the Board is not acting as  the Committee under the Plan) or necessary to obtain the exception for performance-based  compensation under Section 162(m) of the Code, in each case to the extent applicable to the  Company at the time of any action, it is intended that each member of the Committee shall, at  the time he or she takes any such action with respect to an Award under the Plan, be an Eligible  Director.  However, the fact that a Committee member shall fail to qualify as an Eligible  Director shall not invalidate any Award granted by the Committee that is otherwise validly  granted under the Plan.         (b)   Subject to the provisions of the Plan and applicable law, the Committee shall have  the sole and plenary authority, in addition to other express powers and authorizations conferred  on the Committee by the Plan, to: (i) designate Participants; (ii) determine the type or types of  Awards to be granted to a Participant; (iii) determine the number of shares of Common Stock to  be covered by, or with respect to which payments, rights, or other matters are to be calculated in  connection with, Awards; (iv) determine the terms and conditions of any Award; (v) determine  whether, to what extent, and under what circumstances Awards may be settled or exercised in  cash, shares of Common Stock, other securities, other Awards or other property, or canceled,  forfeited, or suspended and the method or methods by which Awards may be settled, exercised,  canceled, forfeited, or suspended; (vi) determine whether, to what extent, and under what  circumstances the delivery of cash, shares of Common Stock, other securities, other Awards or  other property and other amounts payable with respect to an Award shall be deferred either  automatically or at the election of the Participant or of the Committee; (vii) interpret,  administer, reconcile any inconsistency in, correct any defect in and/or supply any omission in  the Plan and any instrument or agreement relating to, or Award granted under, the Plan; (viii)  establish, amend, suspend, or waive any rules and regulations and appoint such agents as the  Committee shall deem appropriate for the proper administration of the Plan; and (ix) make any  other determination and take any other action that the Committee deems necessary or desirable  for the administration of the Plan.         (c)   Except to the extent prohibited by applicable law or the applicable rules and  regulations of any securities exchange or inter-dealer quotation system on which the securities  of the Company are listed or traded, the Committee may allocate all or any portion of its  responsibilities and powers to any one or more of its members and may delegate all or any part  of its responsibilities and powers to any person or persons selected by it.  The Committee may  revoke any such allocation or delegation at any time.  Without limiting the generality of the  foregoing, the Committee may delegate to one or more officers of the Company or any Affiliate  or Subsidiary the authority to act on behalf of the Committee with respect to any matter, right,  obligation, or election which is the responsibility of or which is allocated to the Committee  herein, and which may be so delegated as a matter of law, except for grants of Awards to  persons (i) who are non-employee members of the Board or otherwise are subject to Section 16  of the Exchange Act or (ii) who are, or who are reasonably expected to be, “covered  employees” for purposes of Section 162(m) of the Code.         (d)   Unless otherwise expressly provided in the Plan, all designations, determinations,  interpretations, and other decisions under or with respect to the Plan or any Award or any  documents evidencing Awards granted pursuant to the Plan shall be within the sole discretion of    001366-0016-13471-Active.16178760.5  

 

                                                                             9    the Committee, may be made at any time and shall be final, conclusive and binding upon all  persons or entities, including, without limitation, the Company, any Affiliate, any Participant,  any holder or beneficiary of any Award, and any stockholder of the Company.         (e)   No member of the Board, the Committee or any employee or agent of the  Company (each such person, an “Indemnifiable Person”) shall be liable for any action taken or  omitted to be taken or any determination made with respect to the Plan or any Award hereunder  (unless constituting fraud or a willful criminal act or omission).  Each Indemnifiable Person  shall be indemnified and held harmless by the Company against and from any loss, cost,  liability, or expense (including attorneys’ fees) that may be imposed upon or incurred by such  Indemnifiable Person in connection with or resulting from any action, suit or proceeding to  which such Indemnifiable Person may be a party or in which such Indemnifiable Person may be  involved by reason of any action taken or omitted to be taken or determination made under the  Plan or any Award agreement and against and from any and all amounts paid by such  Indemnifiable Person with the Company’s approval, in settlement thereof, or paid by such  Indemnifiable Person in satisfaction of any judgment in any such action, suit or proceeding  against such Indemnifiable Person, and the Company shall advance to such Indemnifiable  Person any such expenses promptly upon written request (which request shall include an  undertaking by the Indemnifiable Person to repay the amount of such advance if it shall  ultimately be determined as provided below that the Indemnifiable Person is not entitled to be  indemnified); provided that the Company shall have the right, at its own expense, to assume and  defend any such action, suit or proceeding and once the Company gives notice of its intent to  assume the defense, the Company shall have sole control over such defense with counsel of the  Company’s choice.  The foregoing right of indemnification shall not be available to an  Indemnifiable Person to the extent that a final judgment or other final adjudication (in either  case not subject to further appeal) binding upon such Indemnifiable Person determines that the  acts or omissions or determinations of such Indemnifiable Person giving rise to the  indemnification claim resulted from such Indemnifiable Person’s fraud or willful criminal act or  omission or that such right of indemnification is otherwise prohibited by law or by the  Company’s Certificate of Incorporation or Bylaws.  The foregoing right of indemnification shall  not be exclusive of or otherwise supersede any other rights of indemnification to which such  Indemnifiable Persons may be entitled under the Company’s Certificate of Incorporation or  Bylaws, as a matter of law, individual indemnification agreement or contract or otherwise, or  any other power that the Company may have to indemnify such Indemnifiable Persons or hold  them harmless.         (f)   Notwithstanding anything to the contrary contained in the Plan, the Board may, in  its sole discretion, at any time and from time to time, grant Awards and administer the Plan with  respect to such Awards.  Any such actions by the Board shall be subject to the applicable rules  of any securities exchange or inter-dealer quotation system on which the shares of Common  Stock is listed or quoted.  In any such case, the Board shall have all the authority granted to the  Committee under the Plan.         5.    Grant of Awards; Shares Subject to the Plan; Limitations.           (a)   The Committee may, from time to time, grant Awards to one or more Eligible  Persons.    001366-0016-13471-Active.16178760.5  

 

                                                                            10          (b)   Awards granted under the Plan shall be subject to the following limitations: (i)  subject to Section 12 of the Plan, no more than 80,640,142 shares of Common Stock (the  “Absolute Share Limit”) shall be available for Awards under the Plan; (ii) subject to Section 12  of the Plan, no more than the number of shares of Common Stock equal to the Absolute Share  Limit may be delivered in the aggregate pursuant to the exercise of Incentive Stock Options  granted under the Plan; and (iii) following a Public Offering, (A) subject to Section 12 of the  Plan, grants of Options or SARs under the Plan in respect of no more than 27,431,460 shares of  Common Stock may be made to any individual Participant during any single fiscal year of the  Company (for this purpose, if a SAR is granted in tandem with an Option (such that the SAR  expires with respect to the number of shares of Common Stock for which the Option is  exercised), only the shares of Common Stock underlying the Option shall count against this  limitation); (B) subject to Section 12 of the Plan, no more than 27,431,460 shares of Common  Stock may be delivered in respect of Performance Compensation Awards denominated in shares  of Common Stock granted pursuant to Section 11 of the Plan to any individual Participant for a  single fiscal year during a Performance Period (or with respect to each single fiscal year in the  event a Performance Period extends beyond a single fiscal year), or in the event such share  denominated Performance Compensation Award is paid in cash, other securities, other Awards  or other property, no more than the Fair Market Value of such shares of Common Stock on the  last day of the Performance Period to which such Award relates; (C) the maximum amount that  can be paid to any individual Participant for a single fiscal year during a Performance Period (or  with respect to each single fiscal year in the event a Performance Period extends beyond a  single fiscal year) pursuant to a Performance Compensation Award denominated in cash  (described in Section 11(a) of the Plan) shall be $2,000,000; and (D) the maximum number of  shares of Common Stock subject to Awards granted during a single fiscal year to any non- employee director, taken together with any cash fees paid to such non-employee director during  any single fiscal year, shall not exceed $2,000,000 in total value (calculating the value of any  such Awards based on the grant date fair value of such Awards for financial reporting purposes  and excluding, for this purpose, the value of any dividend equivalent payments paid pursuant to  any Award granted in a previous fiscal year.           (c)   Other than with respect to Substitute Awards, to the extent that an Award expires  or is canceled, forfeited, terminated, or otherwise is settled without a delivery to the Participant  of the full number of shares of Common Stock to which the Award related (or a cash amount in  respect thereof), the undelivered shares of Common Stock will again be available for grant.   Shares of Common Stock withheld in payment of the exercise price or taxes relating to an  Award and shares of Common Stock equal to the number of shares of Common Stock  surrendered in payment of any Exercise Price or Strike Price shall be deemed to constitute  shares of Common Stock not delivered to the Participant and shall be deemed to again be  available for Awards under the Plan; provided, however, that such shares of Common Stock  shall not become available for issuance hereunder if either (i) the applicable shares of Common  Stock are withheld or surrendered following the termination of the Plan or (ii) at the time the  applicable shares of Common Stock are withheld or surrendered, it would constitute a material  revision of the Plan subject to stockholder approval under any then-applicable rules of the  national securities exchange on which the shares of Common Stock are listed.      001366-0016-13471-Active.16178760.5  

 

                                                                            11          (d)   Shares of Common Stock delivered by the Company in settlement of Awards may  be authorized and unissued shares, shares held in the treasury of the Company, shares purchased  on the open market or by private purchase or a combination of the foregoing.           (e)   Awards may, in the sole discretion of the Committee, be granted under the Plan in  assumption of, or in substitution for, outstanding awards previously granted by an entity directly  or indirectly acquired by the Company or with which the Company combines (“Substitute  Awards”).  Substitute Awards shall not be counted against the Absolute Share Limit; provided,  that Substitute Awards issued in connection with the assumption of, or in substitution for,  outstanding options intended to qualify as “incentive stock options” within the meaning of  Section 422 of the Code shall be counted against the aggregate number of shares of Common  Stock available for Awards of Incentive Stock Options under the Plan.  Subject to applicable  stock exchange requirements, available shares of Common Stock under a stockholder approved  plan of an entity directly or indirectly acquired by the Company or with which the Company  combines (as appropriately adjusted to reflect the acquisition or combination transaction) may  be used for Awards under the Plan and shall not reduce the number of shares of Common Stock  available for delivery under the Plan.         6.    Eligibility.  Participation in the Plan shall be limited to Eligible Persons.         7.    Options.          (a)   General.  Each Option granted under the Plan shall be evidenced by an Award  agreement, in written or electronic form, which agreement need not be the same for each  Participant.  Each Option so granted shall be subject to the conditions set forth in this Section 7,  and to such other conditions not inconsistent with the Plan as may be reflected in the applicable  Award agreement.  All Options granted under the Plan shall be Nonqualified Stock Options  unless the applicable Award agreement expressly states that the Option is intended to be an  Incentive Stock Option.  Incentive Stock Options shall be granted only to Eligible Persons who  are employees of the Company and its Affiliates, and no Incentive Stock Option shall be  granted to any Eligible Person who is ineligible to receive an Incentive Stock Option under the  Code.  No Option shall be treated as an Incentive Stock Option unless the Plan has been  approved by the stockholders of the Company in a manner intended to comply with the  stockholder approval requirements of Section 422(b)(1) of the Code, provided that any Option  intended to be an Incentive Stock Option shall not fail to be effective solely on account of a  failure to obtain such approval, but rather such Option shall be treated as a Nonqualified Stock  Option unless and until such approval is obtained.  In the case of an Incentive Stock Option, the  terms and conditions of such grant shall be subject to and comply with such rules as may be  prescribed by Section 422 of the Code.  If for any reason an Option intended to be an Incentive  Stock Option (or any portion thereof) shall not qualify as an Incentive Stock Option, then, to the  extent of such nonqualification, such Option or portion thereof shall be regarded as a  Nonqualified Stock Option appropriately granted under the Plan.         (b)   Exercise Price.  Except as otherwise provided by the Committee in the case of  Substitute Awards, the Exercise Price per share of Common Stock for each Option shall not be  less than 100% of the Fair Market Value of such share (determined as of the Date of Grant);  provided, however, that in the case of an Incentive Stock Option granted to an employee who, at    001366-0016-13471-Active.16178760.5  

 

                                                                            12    the time of the grant of such Option, owns stock representing more than 10% of the voting  power of all classes of stock of the Company or any Affiliate, the Exercise Price per share shall  be no less than 110% of the Fair Market Value per share on the Date of Grant.         (c)   Vesting and Expiration.                 (i)   Options shall vest and become exercisable in such manner and on such        date or dates determined by the Committee and shall expire after such period, not to        exceed ten years, as may be determined by the Committee (the “Option Period”);        provided, that other than in the case of an Incentive Stock Option , if following a Public        Offering the Option Period would expire at a time when trading in the shares of Common        Stock is prohibited by the Company’s insider trading policy (or Company-imposed        “blackout period”), the Option Period shall be automatically extended until the thirtieth        (30th) day following the expiration of such prohibition; provided, however, that in no        event shall the Option Period exceed five (5) years from the Date of Grant in the case of        an Incentive Stock Option granted to a Participant who on the Date of Grant owns stock        representing more than 10% of the voting power of all classes of stock of the Company or        any Affiliate.                (ii)  Unless otherwise provided by the Committee, in the event of (A) a        Participant’s Termination by the Company for Cause, all outstanding Options granted to        such Participant shall immediately terminate and expire, (B) a Participant’s Termination        due to death or Disability, each outstanding unvested Option granted to such Participant        shall immediately terminate and expire, and each outstanding vested Option shall remain        exercisable for one (1) year thereafter (but in no event beyond the expiration of the        Option Period) and (C) a Participant’s Termination for any other reason, each outstanding        unvested Option granted to such Participant shall immediately terminate and expire, and        each outstanding vested Option shall remain exercisable for sixty (60) days thereafter        (but in no event beyond the expiration of the Option Period), or such other period as        specified by the Committee in the applicable Award agreement.         (d)   Method of Exercise and Form of Payment.                 (i)   No shares of Common Stock shall be delivered pursuant to any exercise of        an Option until payment in full of the Exercise Price therefor is received by the Company        and the Participant has paid to the Company an amount equal to any Federal, state, local        and non-U.S. income and employment taxes required to be withheld in accordance with        Section 14(d) hereof.  Options which have become exercisable may be exercised (in        whole or in part) by delivery of written or electronic notice of exercise to the Company        (or electronic or telephonic instructions to the extent provided by the Committee) at its        principal office of intent to so exercise (an “Exercise Notice”), provided, that an Option        may be exercised with respect to whole shares of Common Stock only, and provided,        further, that any fractional shares of Common Stock shall be settled in cash. The Exercise        Notice shall specify the number of shares of Common Stock for which the Option is        being exercised and shall be accompanied by payment in full of the Exercise Price.    001366-0016-13471-Active.16178760.5  

 

                                                                            13                (ii)  The payment of the Exercise Price may be made at the election of the        Participant (A)in cash or its equivalent (e.g., by check or, if permitted by the Committee,        a full-recourse promissory note), or (B)if permitted by the Committee, (1) in shares of        Common Stock having a Fair Market Value equal to the aggregate Exercise Price for the        shares of Common Stock being purchased and satisfying such other reasonable        requirements as may be imposed by the Committee; provided, that such shares of        Common Stock have been held by the Participant for any period as established from time        to time by the Committee in order to avoid adverse accounting treatment applying        generally accepted accounting principles and provided, further, that such shares of        Common Stock are not subject to any pledge or other security interest, (2) partly in cash        and partly in such shares of Common Stock, (3) if there is a public market for the shares        of Common Stock at such time, to the extent permitted by the Committee and subject to        such rules as may be established by the Committee, through the delivery of irrevocable        instructions to a broker to sell shares of Common Stock obtained upon the exercise of the        Option and to deliver promptly to the Company an amount out of the proceeds of such        sale equal to the aggregate Exercise Price for such shares of Common Stock being        purchased, or (4) using a net settlement mechanism whereby the number of shares of        Common Stock delivered upon the exercise of the Option will be reduced by a number of        shares of Common Stock that has a Fair Market Value equal to the Exercise Price. A        Participant shall not have any rights to dividends or other rights of a stockholder with        respect to shares of Common Stock subject to an Option until the Participant has given        written notice of exercise of the Option, paid in full for such shares and, if applicable, has        satisfied any other conditions imposed by the Committee pursuant to the Plan.         (e)   Notification upon Disqualifying Disposition of an Incentive Stock Option.  Each  Participant awarded an Incentive Stock Option under the Plan shall notify the Company in  writing immediately after the date he or she makes a disqualifying disposition of any shares of  Common Stock acquired pursuant to the exercise of such Incentive Stock Option.  A  disqualifying disposition is any disposition (including, without limitation, any sale) of such  shares of Common Stock before the later of (i) two (2) years after the Date of Grant of the  Incentive Stock Option or (ii) one (1) year after the date of exercise of the Incentive Stock  Option.  The Company may, if determined by the Committee and in accordance with procedures  established by the Committee, retain possession, as agent for the applicable Participant, of any  shares of Common Stock acquired pursuant to the exercise of an Incentive Stock Option until  the end of the period described in the preceding sentence, subject to complying with any  instructions from such Participant as to the sale of such shares of Common Stock.         (f)   Compliance With Laws, etc.  Notwithstanding the foregoing, in no event shall a  Participant be permitted to exercise an Option in a manner which the Committee determines  would violate the Sarbanes-Oxley Act of 2002, or any other applicable law or the applicable  rules and regulations of the Securities and Exchange Commission or the applicable rules and  regulations of any securities exchange or inter-dealer quotation system on which the securities  of the Company are listed or traded.         8.    Stock Appreciation Rights.      001366-0016-13471-Active.16178760.5  

 

                                                                            14          (a)   General.  Each SAR granted under the Plan shall be evidenced by an Award  agreement.  Each SAR so granted shall be subject to the conditions set forth in this Section 8,  and to such other conditions not inconsistent with the Plan as may be reflected in the applicable  Award agreement.  Any Option granted under the Plan may include tandem SARs.  The  Committee also may award SARs to Eligible Persons independent of any Option.         (b)   Strike Price.  Except as otherwise provided by the Committee in the case of  Substitute Awards, the Strike Price per share of Common Stock for each SAR shall not be less  than 100% of the Fair Market Value of such share (determined as of the Date of Grant).   Notwithstanding the foregoing, a SAR granted in tandem with (or in substitution for) an Option  previously granted shall have a Strike Price equal to the Exercise Price of the corresponding  Option.         (c)   Vesting and Expiration.                 (i)   A SAR granted in connection with an Option shall become exercisable        and shall expire according to the same vesting schedule and expiration provisions as the        corresponding Option.  A SAR granted independent of an Option shall vest and become        exercisable and shall expire in such manner and on such date or dates determined by the        Committee and shall expire after such period, not to exceed ten years, as may be        determined by the Committee (the “SAR Period”); provided, that following a Public        Offering, if the SAR Period would expire at a time when trading in the shares of        Common Stock is prohibited by the Company’s insider trading policy (or Company-       imposed “blackout period”), the SAR Period shall be automatically extended until the        thirtieth (30th) day following the expiration of such prohibition.               (ii)  Unless otherwise provided by the Committee, in the event of (A) a        Participant’s Termination by the Company for Cause, all outstanding SARs granted to        such Participant shall immediately terminate and expire, (B) a Participant’s Termination        due to death or Disability, each outstanding unvested SAR granted to such Participant        shall immediately terminate and expire, and each outstanding vested SAR shall remain        exercisable for one (1) year thereafter (but in no event beyond the expiration of the SAR        Period) and (C) a Participant’s Termination for any other reason, each outstanding        unvested SAR granted to such Participant shall immediately terminate and expire, and        each outstanding vested SAR shall remain exercisable for ninety (90) days thereafter (but        in no event beyond the expiration of the SAR Period), or such other period as specified        by the Committee in the applicable Award agreement.         (d)   Method of Exercise.  SARs that have become exercisable may be exercised by  delivery of written or electronic notice of exercise to the Company in accordance with the terms  of the Award, specifying the number of SARs to be exercised and the date on which such SARs  were awarded.         (e)   Payment/Settlement.  Upon the exercise of a SAR, the Company shall (or shall  cause Parent to) pay to the Participant an amount equal to the number of shares of Common  Stock subject to the SAR that are being exercised multiplied by the excess, if any, of the Fair  Market Value of one (1) share of Common Stock on the exercise date over the Strike Price, less    001366-0016-13471-Active.16178760.5  

 

                                                                            15    an amount equal to any Federal, state, local and non-U.S. income and employment taxes  required to be withheld.  As determined by the Committee, the Company or Parent shall pay  such amount in (w) cash, (x) shares of Common Stock valued at Fair Market Value, (y) shares  of Common Stock or units of capital stock of Parent or one of its majority-owned Subsidiaries  (“Alternative Equity”) valued at Fair Market Value (measured as though all references to shares  of Common Stock in such definition of “Fair Market Value” were replaced with Alternative  Equity) or (z) any combination thereof.  Any fractional shares of Common Stock or Alternative  Equity may be settled in cash, at the Committee’s election. For the avoidance of doubt, it is the  expectation of the Committee that all SARs will generally be settled in shares of Common  Stock or Alternative Equity issued by Parent or another majority parent entity to the Company.          (f)   Substitution of SARs for Nonqualified Stock Options.  The Committee shall have  the authority in its sole discretion to substitute, without the consent of the affected Participant or  any holder or beneficiary of SARs, SARs settled in shares of Common Stock or Alternative  Equity (or settled in shares of Common Stock or cash in the sole discretion of the Committee)  for outstanding Nonqualified Stock Options, provided that (i) the substitution shall not  otherwise result in a modification of the terms of any such Nonqualified Stock Option, (ii) the  number of shares of Common Stock underlying the substituted SARs shall be the same as the  number of shares of Common Stock underlying such Nonqualified Stock Options and (iii) the  Strike Price of the substituted SARs shall be equal to the Exercise Price of such Nonqualified  Stock Options; provided, however, that if, in the opinion of the Company’s independent public  auditors, the foregoing provision creates adverse accounting consequences for the Company,  such provision shall be considered null and void.         9.    Restricted Stock and Restricted Stock Units.           (a)   General.  Each grant of Restricted Stock and Restricted Stock Units shall be  evidenced by an Award agreement.  Each Restricted Stock and Restricted Stock Unit grant shall  be subject to the conditions set forth in this Section 9, and to such other conditions not  inconsistent with the Plan as may be reflected in the applicable Award agreement.         (b)   Stock Certificates and Book Entry; Escrow or Similar Arrangement.  Upon the  grant of Restricted Stock, the Committee shall cause a stock certificate registered in the name of  the Participant to be issued or shall cause share(s) of Common Stock to be registered in the  name of the Participant and held in book-entry form subject to the Company’s directions and, if  the Committee determines that the Restricted Stock shall be held by the Company or in escrow  rather than delivered to the Participant pending the release of the applicable restrictions, the  Committee may require the Participant to additionally execute and deliver to the Company (i)  an escrow agreement satisfactory to the Committee, if applicable, and (ii) the appropriate stock  power (endorsed in blank) with respect to the Restricted Stock covered by such agreement.  If a  Participant shall fail to execute and deliver (in a manner permitted under Section 14(a) or as  otherwise determined by the Committee) an agreement evidencing an Award of Restricted  Stock and, if applicable, an escrow agreement and blank stock power within the amount of time  specified by the Committee, the Award shall be null and void.  Subject to the restrictions set  forth in this Section 9 and the applicable Award agreement, the Participant generally shall have  the rights and privileges of a stockholder as to such Restricted Stock, including without  limitation the right to vote such Restricted Stock (provided that if the lapsing of restrictions with    001366-0016-13471-Active.16178760.5  

 

                                                                            16    respect to any grant of Restricted Stock is contingent on satisfaction of performance conditions  (other than or in addition to the passage of time), any dividends payable on such shares of  Restricted Stock shall be held by the Company and delivered (without interest) to the  Participant within fifteen (15) days following the date on which the restrictions on such  Restricted Stock lapse (and the right to any such accumulated dividends shall be forfeited upon  the forfeiture of the Restricted Stock to which such dividends relate).  To the extent shares of  Restricted Stock are forfeited, any stock certificates issued to the Participant evidencing such  shares shall be returned to the Company, and all rights of the Participant to such shares and as a  stockholder with respect thereto shall terminate without further obligation on the part of the  Company.         (c)   Vesting; Acceleration of Lapse of Restrictions. The Restricted Period with respect  to Restricted Stock and Restricted Stock Units shall lapse in such manner and on such date or  dates determined by the Committee, and the Committee shall determine the treatment of the  unvested portion of Restricted Stock and Restricted Stock Units upon termination of  employment or service of the Participant granted the applicable Award.           (d)   Delivery of Restricted Stock and Settlement of Restricted Stock Units.                 (i)   Upon the expiration of the Restricted Period with respect to any shares of        Restricted Stock, the restrictions set forth in the applicable Award agreement shall be of        no further force or effect with respect to such shares, except as set forth in the applicable        Award agreement.  If an escrow arrangement is used, upon such expiration, the Company        shall deliver to the Participant, or his or her beneficiary, without charge, the stock        certificate (or, if applicable, a notice evidencing a book entry notation) evidencing the        shares of Restricted Stock which have not then been forfeited and with respect to which        the Restricted Period has expired (rounded down to the nearest full share).  Dividends, if        any, that may have been withheld by the Committee and attributable to any particular        share of Restricted Stock shall be distributed to the Participant in cash or, at the sole        discretion of the Committee, in shares of Common Stock having a Fair Market Value (on        the date of distribution) equal to the amount of such dividends, upon the release of        restrictions on such share and, if such share is forfeited, the Participant shall have no right        to such dividends.               (ii)  Unless otherwise provided by the Committee in an Award agreement,        upon the expiration of the Restricted Period with respect to any outstanding Restricted        Stock Units, the Company shall deliver to the Participant, or his or her beneficiary,        without charge, one (1) share of Common Stock (or other securities or other property, as        applicable) for each such outstanding Restricted Stock Unit; provided, however, that the        Committee may, in its sole discretion, elect to (i) pay cash or part cash and part Common        Stock in lieu of delivering only shares of Common Stock in respect of such Restricted        Stock Units or (ii) defer the delivery of shares of Common Stock (or cash or part        Common Stock and part cash, as the case may be) beyond the expiration of the Restricted        Period if such extension would not cause adverse tax consequences under Section 409A       of the Code.  If a cash payment is made in lieu of delivering shares of Common Stock,       the amount of such payment shall be equal to the Fair Market Value of the shares of       Common Stock as of the date on which the Restricted Period lapsed with respect to such    001366-0016-13471-Active.16178760.5  

 

                                                                            17          Restricted Stock Units.  To the extent provided in an Award agreement, the holder of        outstanding Restricted Stock Units shall be entitled to be credited with dividend        equivalent payments (upon the payment by the Company of dividends on shares of        Common Stock) either in cash or, at the sole discretion of the Committee, in shares of        Common Stock having a Fair Market Value equal to the amount of such dividends (and        interest may, at the sole discretion of the Committee, be credited on the amount of cash       dividend equivalents at a rate and subject to such terms as determined by the Committee),       which accumulated dividend equivalents (and interest thereon, if applicable) shall be       payable at the same time as the underlying Restricted Stock Units are settled following       the release of restrictions on such Restricted Stock Units, and, if such Restricted Stock       Units are forfeited, the Participant shall have no right to such dividend equivalent       payments.         (e)   Legends on Restricted Stock.  Each certificate representing Restricted Stock  awarded under the Plan, if any, shall bear a legend substantially in the form of the following, in  addition to any other information the Company deems appropriate, until the lapse of all  restrictions with respect to such shares of Common Stock:         TRANSFER OF THIS CERTIFICATE AND THE SHARES REPRESENTED        HEREBY IS RESTRICTED PURSUANT TO THE TERMS OF THE          VIVINT        GROUP, INC. AMENDED AND RESTATED 2013 OMNIBUS INCENTIVE        PLAN AND A RESTRICTED STOCK AWARD AGREEMENT, BETWEEN        VIVINT GROUP, INC. AND PARTICIPANT.  A COPY OF SUCH PLAN AND        AWARD AGREEMENT IS ON FILE AT THE PRINCIPAL EXECUTIVE        OFFICES OF VIVINT GROUP, INC.         10.   Other Stock-Based Awards.           The Committee may issue unrestricted shares of Common Stock, rights to receive grants  of Awards at a future date, or other Awards denominated in shares of Common Stock  (including, without limitation, performance shares or performance units), under the Plan to  Eligible Persons, alone or in tandem with other Awards, in such amounts as the Committee shall  from time to time in its sole discretion determine.  Each Other Stock-Based Award granted  under the Plan shall be evidenced by an Award agreement.  Each Other Stock-Based Award so  granted shall be subject to such conditions not inconsistent with the Plan as may be reflected in  the applicable Award agreement.           11.   Performance Compensation Awards.           (a)   General.  The Committee shall have the authority, at or before the time of grant  of any Award, to designate such Award as a Performance Compensation Award intended to  qualify as “performance-based compensation” under Section 162(m) of the Code, to the extent  applicable to the Company following a Public Offering.  The Committee shall also have the  authority to make an award of a cash bonus to any Participant and designate such Award as a  Performance Compensation Award intended to qualify as “performance-based compensation”  under Section 162(m) of the Code, to the extent applicable to the Company following a Public  Offering.  Notwithstanding anything in the Plan to the contrary, if the Company determines that    001366-0016-13471-Active.16178760.5  

 

                                                                            18    a Participant who has been granted an Award designated as a Performance Compensation  Award is not (or is no longer) a “covered employee” (within the meaning of Section 162(m) of  the Code) at any time when Section 162(m) of the Code is applicable to the Company, the terms  and conditions of such Award may be modified without regard to any restrictions or limitations  set forth in this Section 11 (but subject otherwise to the provisions of Section 13 of the Plan).         (b)   Discretion of Committee with Respect to Performance Compensation Awards.   With regard to a particular Performance Period, the Committee shall have sole discretion to  select the length of such Performance Period, the type(s) of Performance Compensation Awards  to be issued, the Performance Criteria that will be used to establish the Performance Goal(s),  define in an objective fashion the manner of calculating the Performance Criteria it selects to  use for such Performance Goal(s), and the kind(s) and/or level(s) of the Performance Goals(s)  that is (are) to apply and the Performance Formula. The Committee shall, with regard to the  Performance Compensation Awards to be issued for such Performance Period, exercise its  discretion with respect to each of the matters enumerated in the immediately preceding sentence  and record the same in writing and, if such Performance Period includes any time during which  Section 162(m) of the Code is applicable to the Company, shall complete the foregoing within  the first ninety (90) days of a Performance Period (or, within any other maximum period  allowed under Section 162(m) of the Code). To the extent required under Section 162(m) of the  Code, the Committee shall, within the first ninety (90) days of a Performance Period (or, within  any other maximum period allowed under Section 162(m) of the Code).         (c)   Performance Criteria.  The Performance Criteria that will be used to establish the  Performance Goal(s) may be based on the attainment of specific levels of performance of the  Company (and/or one or more Affiliates, divisions or operational and/or business units, product  lines, brands, business segments, administrative departments, or any combination of the  foregoing). With respect to any Performance Period that covers any period of time during which  Section 162(m) of the Code is applicable to the Company, the Performance Criteria shall be  limited to the following: (i) net earnings or net income (before or after taxes); (ii) basic or  diluted earnings per share (before or after taxes); (iii) net revenue or net revenue growth; (iv)  gross revenue or gross revenue growth, gross profit or gross profit growth; (v) net operating  profit (before or after taxes); (vi) return measures (including, but not limited to, return on  investment, assets, capital, employed capital, invested capital, equity, or sales); (vii) cash flow  measures (including, but not limited to, operating cash flow, free cash flow, and cash flow  return on capital), which may but are not required to be measured on a per share basis; (viii)  earnings before or after taxes, interest, depreciation and/or amortization (including EBIT and  EBITDA); (ix) gross or net operating margins; (x) productivity ratios; (xi) share price  (including, but not limited to, growth measures and total stockholder return); (xii) expense  targets or cost reduction goals, general and administrative expense savings; (xiii) operating  efficiency; (xiv) objective measures of customer satisfaction; (xv) working capital targets; (xvi)  measures of economic value added or other ‘value creation’ metrics; (xvii) inventory control;  (xviii) enterprise value; (xix) sales; (xx) stockholder return; (xxi) client retention; (xxii)  competitive market metrics; (xxiii) employee retention; (xxiv) timely completion of new  product rollouts; (xxv) timely launch of new facilities; (xxvi) strategic objectives; (xxvii)  objective measures of personal targets, goals or completion of projects (including but not  limited to succession and hiring projects, completion of specific acquisitions, reorganizations or  other corporate transactions or capital-raising transactions, expansions of specific business    001366-0016-13471-Active.16178760.5  

 

                                                                            19    operations and meeting divisional or project budgets); (xxviii) system-wide revenues; (xxix)  royalty income; (xxx) comparisons of continuing operations to other operations; (xxxi) market  share; (xxxii) cost of capital, debt leverage year-end cash position or book value; (xxxiii)  development of new product lines and related revenue, sales and margin targets, franchisee  growth and retention, co-branding or international operations; or (xxxiv) any combination of the  foregoing.  Any one or more of the Performance Criteria may be stated as a percentage of  another Performance Criteria, or used on an absolute or relative basis to measure the  performance of the Company and/or one or more Affiliates as a whole or any divisions or  operational and/or business units, product lines, brands, business segments, administrative  departments of the Company and/or one or more Affiliates or any combination thereof, as the  Committee may deem appropriate, or any of the above Performance Criteria may be compared  to the performance of a selected group of comparison companies, or a published or special  index that the Committee, in its sole discretion, deems appropriate, or as compared to various  stock market indices.  The Committee also has the authority to provide for accelerated vesting  of any Award based on the achievement of Performance Goals pursuant to the Performance  Criteria specified in this paragraph.           (d)   Modification of Performance Goal(s).  In the event that applicable tax and/or  securities laws change to permit Committee discretion to alter the governing Performance  Criteria without obtaining stockholder approval of such alterations, the Committee shall have  sole discretion to make such alterations without obtaining stockholder approval.  Following the  Public Offering, at any time that Section 162(m) of the Code applies to any Performance  Compensation Awards, unless otherwise determined by the Committee at the time a  Performance Compensation Award is granted, the Committee shall, during the first ninety (90)  days of a Performance Period (or, within any other maximum period allowed under Section  162(m) of the Code), or at any time thereafter to the extent the exercise of such authority at such  time would not cause the Performance Compensation Awards granted to any Participant for  such Performance Period to fail to qualify as “performance-based compensation” under Section  162(m) of the Code, specify adjustments or modifications to be made to the calculation of a  Performance Goal for such Performance Period, based on and in order to appropriately reflect  the following events: (i) asset write-downs; (ii) litigation, claims, judgments or settlements; (iii)  the effect of changes in tax laws, accounting principles, or other laws or regulatory rules  affecting reported results; (iv) any reorganization and restructuring programs; (v) extraordinary  nonrecurring items as described in Accounting Standards Codification Topic 225-20 (or any  successor pronouncement thereto) and/or in management’s discussion and analysis of financial  condition and results of operations appearing in the Company’s annual report to stockholders  for the applicable year; (vi) acquisitions or divestitures; (vii) any other specific, unusual or  nonrecurring events, or objectively determinable category thereof; (viii) foreign exchange gains  and losses; (ix) discontinued operations and nonrecurring charges; and (x) a change in the  Company’s fiscal year.         (e)   Payment of Performance Compensation Awards.                 (i)   Condition to Receipt of Payment.  Unless otherwise provided in the        applicable Award agreement, a Participant must be employed by the Company or one of        its Affiliates or Subsidiaries on the last day of a Performance Period to be eligible for        payment in respect of a Performance Compensation Award for such Performance Period.    001366-0016-13471-Active.16178760.5  

 

                                                                             20                  (ii)  Limitation.  Unless otherwise provided in the applicable Award         agreement, a Participant shall be eligible to receive payment in respect of a Performance         Compensation Award only to the extent that: (A) the Performance Goals for such period         are achieved; and (B) all or some of the portion of such Participant’s Performance         Compensation Award has been earned for the Performance Period based on the         application of the Performance Formula to such achieved Performance Goals.                (iii) Certification.  Following the completion of a Performance Period, the         Committee shall review and certify in writing whether, and to what extent, the         Performance Goals for the Performance Period have been achieved and, if so, calculate         and certify in writing that amount of the Performance Compensation Awards earned for         the period based upon the Performance Formula.  The Committee shall then determine         the amount of each Participant’s Performance Compensation Award actually payable for         the Performance Period and, in so doing, may apply Negative Discretion.                (iv)  Use of Negative Discretion.  In determining the actual amount of an         individual Participant’s Performance Compensation Award for a Performance Period, the         Committee may reduce or eliminate the amount of the Performance Compensation         Award earned under the Performance Formula in the Performance Period through the use         of Negative Discretion.  Unless otherwise provided in the applicable Award agreement,         the Committee shall not have the discretion to (A) grant or provide payment in respect of         Performance Compensation Awards for a Performance Period if the Performance Goals         for such Performance Period have not been attained; or (B) increase a Performance         Compensation Award above the applicable limitations set forth in Section 5 of the Plan.          (f)   Timing of Award Payments.  Unless otherwise provided in the applicable Award   agreement, Performance Compensation Awards granted for a Performance Period shall be paid   to Participants as soon as administratively practicable following completion of the certifications   required by this Section 11.  Any Performance Compensation Award that has been deferred   shall not (between the date as of which the Award is deferred and the payment date) increase (i)   with respect to a Performance Compensation Award that is payable in cash, by a measuring   factor for each fiscal year greater than a reasonable rate of interest set by the Committee or (ii)   with respect to a Performance Compensation Award that is payable in shares of Common Stock,   by an amount greater than the appreciation of a share of Common Stock from the date such   Award is deferred to the payment date.  Any Performance Compensation Award that is deferred   and is otherwise payable in shares of Common Stock shall be credited (during the period   between the date as of which the Award is deferred and the payment date) with dividend   equivalents (in a manner consistent with the methodology set forth in the last sentence of   Section 9(d)(ii)).            12.   Changes in Capital Structure and Similar Events.  In the event of (a) any   dividend or other distribution (whether in the form of cash, shares of Common Stock, other   securities or other property and excluding any dividend or distribution used to satisfy   indebtedness of Parent and/or its Affiliates and Subsidiaries), recapitalization, stock split, reverse   stock split, reorganization, merger, consolidation, split-up, split-off, spin-off, combination,  repurchase or exchange of shares of Common Stock or other securities of the Company, issuance  of warrants or other rights to acquire shares of Common Stock or other securities of the     001366-0016-13471-Active.16178760.5  

 

                                                                            21    Company, or other similar corporate transaction or event (including, without limitation, a  Change of Control) that affects the shares of Common Stock, or (b) unusual or nonrecurring  events (including, without limitation, a Change of Control) affecting the Company or any  Subsidiary or Affiliate, or the financial statements of the Company or any Subsidiary or Affiliate,  or changes in applicable rules, rulings, regulations or other requirements of any governmental  body or securities exchange or inter-dealer quotation system, accounting principles or law, such  that in either case an adjustment is determined by the Committee in its sole discretion to be  necessary or appropriate, then the Committee shall make any such adjustments in such manner as  it may deem equitable, including without limitation, any or all of the following:               (i)   adjusting any or all of (A) the Absolute Share Limit, or any other limit        applicable under the Plan with respect to the number of Awards which may be granted        hereunder, (B) the number of shares of Common Stock or other securities of the        Company (or number and kind of other securities or other property) which may be        delivered in respect of Awards or with respect to which Awards may be granted under the        Plan (including, without limitation, adjusting any or all of the limitations under Section 5        of the Plan) and (C) the terms of any outstanding Award, including, without limitation,        (1) the number of shares of Common Stock or other securities of the Company (or        number and kind of other securities or other property) subject to outstanding Awards or        to which outstanding Awards relate, (2) the Exercise Price or Strike Price with respect to        any Award or (3) any applicable performance measures (including, without limitation,        Performance Criteria and Performance Goals);               (ii)  providing for a substitution or assumption of Awards (or awards of an        acquiring company), accelerating the exercisability of, lapse of restrictions on, or        termination of, Awards or providing for a period of time (which shall not be required to        be more than ten (10) days) for Participants to exercise outstanding Awards prior to the        occurrence of such event (and any such Award not so exercised shall terminate upon the        occurrence of such event); and               (iii) cancelling any one or more outstanding Awards and causing to be paid to        the holders holding vested Awards (including any Awards that would vest as a result of        the occurrence of such event but for such cancellation) the value of such Awards, if any,        as determined by the Committee (which if applicable may be based upon the price per        share of Common Stock received or to be received by other stockholders of the Company        in such event), including without limitation, in the case of an outstanding Option or SAR,        a cash payment in an amount equal to the excess, if any, of the Fair Market Value (as of a        date specified by the Committee) of the shares of Common Stock subject to such Option        or SAR over the aggregate Exercise Price or Strike Price of such Option or SAR,        respectively (it being understood that, in such event, any Option or SAR having a per        share Exercise Price or Strike Price equal to, or in excess of, the Fair Market Value of a        share of Common Stock subject thereto may be canceled and terminated without any        payment or consideration therefor);   provided, however, that in the case of any “equity restructuring” (within the meaning of the  Financial Accounting Standards Board Accounting Standards Codification Topic 718 (or any  successor pronouncement thereto)), the Committee shall make an equitable or proportionate    001366-0016-13471-Active.16178760.5  

 

                                                                            22    adjustment to outstanding Awards to reflect such equity restructuring.  Any adjustment in  Incentive Stock Options under this Section 12 (other than any cancellation of Incentive Stock  Options) shall be made only to the extent not constituting a “modification” within the meaning of  Section 424(h)(3) of the Code, and any adjustments under this Section 12 shall be made in a  manner which does not adversely affect the exemption provided pursuant to Rule 16b-3 under  the Exchange Act.  Any such adjustment shall be conclusive and binding for all purposes.   Payments to holders pursuant to clause (iii) above shall be made in cash or, in the sole discretion  of the Committee, in the form of such other consideration necessary for a Participant to receive  property, cash, or securities (or combination thereof) as such Participant would have been  entitled to receive upon the occurrence of the transaction if the Participant had been, immediately  prior to such transaction, the holder of the number of shares of Common Stock covered by the  Award at such time (less any applicable Exercise Price or Strike Price).  In addition, prior to any  payment or adjustment contemplated under this Section 12, the Committee may require a  Participant to (A) represent and warrant as to the unencumbered title to his Awards, (B) bear  such Participant’s pro rata share of any post-closing indemnity obligations, and be subject to the  same post-closing purchase price adjustments, escrow terms, offset rights, holdback terms, and  similar conditions as the other holders of Stock, and (C) deliver customary transfer  documentation as reasonably determined by the Committee.         13.   Amendments and Termination.           (a)   Amendment and Termination of the Plan.  The Board may amend, alter, suspend,  discontinue, or terminate the Plan or any portion thereof at any time; provided, that no such  amendment, alteration, suspension, discontinuation or termination shall be made without  stockholder approval if (i) such approval is necessary to comply with any regulatory  requirement applicable to the Plan (including, without limitation, as necessary to comply with  any rules or regulations of any securities exchange or inter-dealer quotation system on which  the securities of the Company may be listed or quoted) or for changes in GAAP to new  accounting standards or (ii) after a Public Offering, (A) it would materially increase the number  of securities which may be issued under the Plan (except for increases pursuant to Section 5 or  12) or (B) it would materially modify the requirements for participation in the Plan; provided,  further, that any such amendment, alteration, suspension, discontinuance or termination that  would materially diminish the rights of any Participant or any holder or beneficiary of any  Award theretofore granted shall not to that extent be effective without the consent of either (x)  the affected Participant, holder or beneficiary or (y) two-thirds of such affected Participants.   Notwithstanding the foregoing, no amendment shall be made to the last proviso of Section 13(b)  without stockholder approval.         (b)   Amendment of Award Agreements.  The Committee may, to the extent  consistent with the terms of any applicable Award agreement, waive any conditions or rights  under, amend any terms of, or alter, suspend, discontinue, cancel or terminate, any Award  theretofore granted or the associated Award agreement, prospectively or retroactively (including  after a Participant’s termination of employment or service with the Company); provided that  any such waiver, amendment, alteration, suspension, discontinuance, cancellation or termination  that would materially diminish the rights of any Participant with respect to any Award  theretofore granted shall not to that extent be effective without the consent of either (x) the  affected Participant or (y) two-thirds of such affected Participants; provided, further, that    001366-0016-13471-Active.16178760.5  

 

                                                                            23    following a Public Offering, without stockholder approval, except as otherwise permitted under  Section 12 of the Plan, (i) no amendment or modification may reduce the Exercise Price of any  Option or the Strike Price of any SAR, (ii) the Committee may not cancel any outstanding  Option or SAR and replace it with a new Option or SAR (with a lower Exercise Price or Strike  Price, as the case may be) or other Award or cash payment that is greater than the value of the  cancelled Option or SAR, and (iii) the Committee may not take any other action which is  considered a “repricing” for purposes of the stockholder approval rules of any securities  exchange or inter-dealer quotation system on which the securities of the Company are listed or  quoted.         14.   General.         (a)   Award Agreements.  Each Award under the Plan shall be evidenced by an Award  agreement, which shall be delivered to the Participant and shall specify the terms and conditions  of the Award and any rules applicable thereto, including without limitation, the effect on such  Award of the death, Disability or termination of employment or service of a Participant, or of  such other events as may be determined by the Committee.  For purposes of the Plan, an Award  agreement may be in any such form (written or electronic) as determined by the Committee  (including, without limitation, a Board or Committee resolution, an employment agreement, a  notice, a certificate or a letter) evidencing the Award.  The Committee need not require an  Award agreement to be signed by the Participant or a duly authorized representative of the  Company.         (b)   Nontransferability.  (i)  Each Award shall be exercisable only by a Participant  during the Participant’s lifetime, or, if permissible under applicable law, by the Participant’s  legal guardian or representative.  No Award may be assigned, alienated, pledged, attached, sold  or otherwise transferred or encumbered by a Participant other than by will or by the laws of  descent and distribution and any such purported assignment, alienation, pledge, attachment,  sale, transfer or encumbrance shall be void and unenforceable against the Company or an  Affiliate; provided that the designation of a beneficiary shall not constitute an assignment,  alienation, pledge, attachment, sale, transfer or encumbrance.               (ii)  Notwithstanding the foregoing, the Committee may, in its sole discretion,        permit Awards (other than Incentive Stock Options) to be transferred by a Participant,        without consideration, subject to such rules as the Committee may adopt consistent with        any applicable Award agreement to preserve the purposes of the Plan, to: (A) Immediate        Family Members; (B) a trust solely for the benefit of the Participant and his or her        Immediate Family Members; (C) a partnership or limited liability company whose only        partners or stockholders are the Participant and his or her Immediate Family Members; or        (D) a beneficiary to whom donations are eligible to be treated as “charitable        contributions” for federal income tax purposes;         (each transferee described in clauses (A), (B), (C) and (D) above is hereinafter referred to        as a “Permitted Transferee”); provided that the Participant gives the Committee advance        written notice describing the terms and conditions of the proposed transfer and the        Committee notifies the Participant in writing that such a transfer would comply with the        requirements of the Plan.    001366-0016-13471-Active.16178760.5  

 

                                                                            24                (iii) The terms of any Award transferred in accordance with the immediately        preceding sentence shall apply to the Permitted Transferee and any reference in the Plan,        or in any applicable Award agreement, to a Participant shall be deemed to refer to the        Permitted Transferee, except that (A) Permitted Transferees shall not be entitled to        transfer any Award, other than by will or the laws of descent and distribution; (B)        Permitted Transferees shall not be entitled to exercise any transferred Option unless there        shall be in effect a registration statement on an appropriate form covering the shares of        Common Stock to be acquired pursuant to the exercise of such Option if the Committee        determines, consistent with any applicable Award agreement, that such a registration        statement is necessary or appropriate; (C) the Committee or the Company shall not be        required to provide any notice to a Permitted Transferee, whether or not such notice is or        would otherwise have been required to be given to the Participant under the Plan or        otherwise; and (D) the consequences of the termination of the Participant’s employment        by, or services to, the Company or an Affiliate under the terms of the Plan and the        applicable Award agreement shall continue to be applied with respect to the Participant,        including, without limitation, that an Option shall be exercisable by the Permitted        Transferee only to the extent, and for the periods, specified in the Plan and the applicable        Award agreement.         (c)   Dividends and Dividend Equivalents.  The Committee in its sole discretion may  provide a Participant as part of an Award with dividends or dividend equivalents, payable in  cash, shares of Common Stock, other securities, other Awards or other property, on a current or  deferred basis, on such terms and conditions as may be determined by the Committee in its sole  discretion, including without limitation, payment directly to the Participant, withholding of such  amounts by the Company subject to vesting of the Award or reinvestment in additional shares  of Common Stock, Restricted Stock or other Awards; provided, that no dividends or dividend  equivalents shall be payable in respect of outstanding (i) Options or SARs or (ii) unearned  Performance Compensation Awards or other unearned Awards subject to performance  conditions (other than or in addition to the passage of time) (although dividends and dividend  equivalents may be accumulated in respect of unearned Awards and paid within 15 days after  such Awards are earned and become payable or distributable).         (d)   Tax Withholding.                 (i)   A Participant shall be required to pay to the Company or any Affiliate in        cash or its equivalent (e.g., check), and the Company or any Affiliate shall have the right       and is hereby authorized to withhold, from any cash, shares of Common Stock, other       securities or other property deliverable under any Award or from any compensation or       other amounts owing to a Participant, the amount (in cash, shares of Common Stock,       other securities or other property) of any required withholdings or taxes in respect of an       Award, its exercise, or any payment or transfer under an Award or under the Plan and to       take such other action as may be necessary in the opinion of the Committee or the       Company to satisfy all obligations for the payment of such withholdings and taxes.               (ii)  Without limiting the generality of clause (i) above, the Committee may, in        its sole discretion, permit a Participant to satisfy, in whole or in part, the foregoing        withholding liability by (A) the delivery of shares of Common Stock (which are not    001366-0016-13471-Active.16178760.5  

 

                                                                            25          subject to any pledge or other security interest) owned by the Participant having a Fair        Market Value equal to such withholding liability or (B) having the Company withhold        from the number of shares of Common Stock otherwise issuable or deliverable pursuant        to the exercise or settlement of the Award a number of shares of Common Stock with a        Fair Market Value equal to such withholding liability, provided that with respect to        shares of Common Stock withheld pursuant to clause (B), the number of such shares of        Common Stock may not have a Fair Market Value greater than the minimum required        statutory withholding liability.         (e)   No Claim to Awards; No Rights to Continued Employment; Waiver.  No  employee of the Company or an Affiliate or Subsidiary, or other person, shall have any claim or  right to be granted an Award under the Plan or, having been selected for the grant of an Award,  to be selected for a grant of any other Award.  There is no obligation for uniformity of treatment  of Participants or holders or beneficiaries of Awards.  The terms and conditions of Awards and  the Committee’s determinations and interpretations with respect thereto need not be the same  with respect to each Participant and may be made selectively among Participants, whether or  not such Participants are similarly situated.  Neither the Plan nor any action taken hereunder  shall be construed as giving any Participant any right to be retained in the employ or service of  the Company or an Affiliate or Subsidiary, nor shall it be construed as giving any Participant  any rights to continued service on the Board.  The Company and any of its Affiliates and  Subsidiaries may at any time dismiss a Participant from employment or discontinue any  consulting relationship, free from any liability or any claim under the Plan, unless otherwise  expressly provided in the Plan or any Award agreement.  By accepting an Award under the  Plan, a Participant shall thereby be deemed to have waived any claim to continued exercise or  vesting of an Award or to damages or severance entitlement related to non-continuation of the  Award beyond the period provided under the Plan or any Award agreement, except to the extent  of any provision to the contrary in any written employment contract or other agreement between  the Company and its Affiliates and the Participant, whether any such agreement is executed  before, on or after the Date of Grant.         (f)   International Participants.  With respect to Participants who reside or work  outside of the United States of America and who are not (and who are not expect to be)  “covered employees” within the meaning of Section 162(m) of the Code, to the extent  applicable to the Company following a Public Offering, the Committee may in its sole  discretion amend the terms of the Plan or Sub-Plans or outstanding Awards with respect to such  Participants in order to conform such terms with the requirements of local law or to obtain more  favorable tax or other treatment for a Participant, the Company or its Affiliates or Subsidiaries.         (g)   Designation and Change of Beneficiary.  Each Participant may file with the  Committee a written designation of one or more persons as the beneficiary(ies) who shall be  entitled to receive the amounts payable with respect to an Award, if any, due under the Plan  upon his or her death.  A Participant may, from time to time, revoke or change his or her  beneficiary designation without the consent of any prior beneficiary by filing a new designation  with the Committee.  The last such designation received by the Committee shall be controlling;  provided, however, that no designation, or change or revocation thereof, shall be effective  unless received by the Committee prior to the Participant’s death, and in no event shall it be  effective as of a date prior to such receipt.  If no beneficiary designation is filed by a Participant,    001366-0016-13471-Active.16178760.5  

 

                                                                            26    the beneficiary shall be deemed to be his or her spouse or, if the Participant is unmarried at the  time of death, his or her estate.         (h)   Termination.  Except as otherwise provided in an Award agreement, unless  determined otherwise by the Committee at any point following such event: (i) neither a  temporary absence from employment or service due to illness, vacation or leave of absence  (including, without limitation, a call to active duty for military service through a Reserve or  National Guard unit) nor a transfer from employment or service with one Service Recipient to  employment or service with another Service Recipient (or vice-versa) shall be considered a  Termination; and (ii) if a Participant’s undergoes a Termination of employment, but such  Participant continues to provide services to the Company and its Affiliates or Subsidiaries in a  non-employee capacity, such change in status shall not be considered a Termination for  purposes of the Plan.  Further, unless otherwise determined by the Committee, in the event that  any Service Recipient ceases to be an Affiliate of the Company (by reason of sale, divestiture,  spin-off, or other similar transaction), unless a Participant’s employment or service is  transferred to another entity that would constitute a Service Recipient immediately following  such transaction, such Participant shall be deemed to have suffered a Termination hereunder as  of the date of the consummation of such transaction.         (i)   No Rights as a Stockholder.  Except as otherwise specifically provided in the Plan  or any Award agreement, no person shall be entitled to the privileges of ownership in respect of  shares of Common Stock which are subject to Awards hereunder until such shares of Common  Stock have been issued or delivered to that person.         (j)   Government and Other Regulations.                 (i)   The obligation of the Company to settle Awards in shares of Common        Stock or other consideration shall be subject to all applicable laws, rules, and regulations,        and to such approvals by governmental agencies as may be required.  Notwithstanding        any terms or conditions of any Award to the contrary, the Company shall be under no        obligation to offer to sell or to sell, and shall be prohibited from offering to sell or selling,        any shares of Common Stock pursuant to an Award unless such shares of Common Stock        have been properly registered for sale pursuant to the Securities Act with the Securities        and Exchange Commission or unless the Company has received an opinion of counsel,        satisfactory to the Company, that such shares of Common Stock may be offered or sold        without such registration pursuant to an available exemption therefrom and the terms and        conditions of such exemption have been fully complied with.  The Company shall be        under no obligation to register for sale under the Securities Act any of the shares of        Common Stock to be offered or sold under the Plan.  The Committee shall have the        authority to provide that all shares of Common Stock or other securities of the Company        or any Affiliate delivered under the Plan shall be subject to such stop transfer orders and        other restrictions as the Committee may deem advisable under the Plan, the applicable        Award agreement, the Federal securities laws, or the rules, regulations and other        requirements of the Securities and Exchange Commission, any securities exchange or        inter- dealer quotation system on which the securities of the Company are listed or quoted        and any other applicable Federal, state, local or non-U.S. laws, rules, regulations and        other requirements, and, without limiting the generality of Section 9 of the Plan, the    001366-0016-13471-Active.16178760.5  

 

                                                                            27          Committee may cause a legend or legends to be put on certificates representing shares of        Common Stock or other securities of the Company or any Affiliate delivered under the        Plan to make appropriate reference to such restrictions or may cause such shares of        Common Stock or other securities of the Company or any Affiliate delivered under the        Plan in book-entry form to be held subject to the Company’s instructions or subject to        appropriate stop-transfer orders.  Notwithstanding any provision in the Plan to the        contrary, the Committee reserves the right to add any additional terms or provisions to        any Award granted under the Plan that it in its sole discretion deems necessary or        advisable in order that such Award complies with the legal requirements of any        governmental entity to whose jurisdiction the Award is subject.               (ii)  The Committee may cancel an Award or any portion thereof if it        determines, in its sole discretion, that legal or contractual restrictions and/or blockage        and/or other market considerations would make the Company’s acquisition of shares of        Common Stock from the public markets, the Company’s issuance of shares of Common        Stock to the Participant, the Participant’s acquisition of shares of Common Stock from        the Company and/or the Participant’s sale of shares of Common Stock to the public        markets, illegal, impracticable or inadvisable.  If the Committee determines to cancel all        or any portion of an Award in accordance with the foregoing, the Company shall pay to        the Participant an amount equal to the excess of (A) the aggregate Fair Market Value of        the shares of Common Stock subject to such Award or portion thereof canceled        (determined as of the applicable exercise date, or the date that the shares of Common        Stock would have been vested or delivered, as applicable), over (B) the aggregate        Exercise Price or Strike Price (in the case of an Option or SAR, respectively) or any        amount payable as a condition of delivery of shares of Common Stock (in the case of any        other Award).  Such amount shall be delivered to the Participant as soon as practicable        following the cancellation of such Award or portion thereof.         (k)   No Section 83(b) Elections Without Consent of Company.  No election under  Section 83(b) of the Code or under a similar provision of law may be made unless expressly  permitted by the terms of the applicable Award agreement or by action of the Committee in  writing prior to the making of such election.  If a Participant, in connection with the acquisition  of shares of Common Stock under the Plan or otherwise, is expressly permitted to make such  election and the Participant makes the election, the Participant shall notify the Company of such  election within ten (10) days of filing notice of the election with the Internal Revenue Service or  other governmental authority, in addition to any filing and notification required pursuant to  Section 83(b) of the Code or other applicable provision.         (l)   Payments to Persons Other Than Participants.  If the Committee shall find that  any person to whom any amount is payable under the Plan is unable to care for his or her affairs  because of illness or accident, or is a minor, or has died, then any payment due to such person or  his or her estate (unless a prior claim therefor has been made by a duly appointed legal  representative) may, if the Committee so directs the Company, be paid to his or her spouse,  child, relative, an institution maintaining or having custody of such person, or any other person  deemed by the Committee to be a proper recipient on behalf of such person otherwise entitled to  payment.  Any such payment shall be a complete discharge of the liability of the Committee and  the Company therefor.    001366-0016-13471-Active.16178760.5  

 

                                                                            28          (m)   Nonexclusivity of the Plan.  Neither the adoption of this Plan by the Board nor the  submission of this Plan to the stockholders of the Company for approval shall be construed as  creating any limitations on the power of the Board to adopt such other incentive arrangements  as it may deem desirable, including, without limitation, the granting of stock options otherwise  than under this Plan, and such arrangements may be either applicable generally or only in  specific cases.         (n)   No Trust or Fund Created.  Neither the Plan nor any Award shall create or be  construed to create a trust or separate fund of any kind or a fiduciary relationship between the  Company or any Affiliate, on the one hand, and a Participant or other person or entity, on the  other hand.  No provision of the Plan or any Award shall require the Company, for the purpose  of satisfying any obligations under the Plan, to purchase assets or place any assets in a trust or  other entity to which contributions are made or otherwise to segregate any assets, nor shall the  Company maintain separate bank accounts, books, records or other evidence of the existence of  a segregated or separately maintained or administered fund for such purposes.  Participants shall  have no rights under the Plan other than as unsecured general creditors of the Company, except  that insofar as they may have become entitled to payment of additional compensation by  performance of services, they shall have the same rights as other employees under general law.         (o)   Reliance on Reports.  Each member of the Committee and each member of the  Board shall be fully justified in acting or failing to act, as the case may be, and shall not be  liable for having so acted or failed to act in good faith, in reliance upon any report made by the  independent public accountant of the Company and its Affiliates and/or any other information  furnished in connection with the Plan by any agent of the Company or the Committee or the  Board, other than himself.         (p)   Relationship to Other Benefits.  No payment under the Plan shall be taken into  account in determining any benefits under any pension, retirement, profit sharing, group  insurance or other benefit plan of the Company except as otherwise specifically provided in  such other plan.         (q)   Governing Law.  The Plan shall be governed by and construed in accordance  with the internal law of the State of Utah applicable to contracts made and performed wholly  within the State of Utah, without giving effect to the conflict of law provisions thereof that  would direct the application of the law of any other jurisdiction. Any suit, action or proceeding  with respect to this Plan, or any judgment entered by any court in respect of any thereof, shall  be brought exclusively in any court of competent jurisdiction in Salt Lake City, Utah, and each  of the Company and the Participant’s Immediate Family Members hereby submits to the  exclusive jurisdiction of such courts for the purpose of any such suit, action, proceeding or  judgment. Each of the Participant’s Immediate Family Members and the Company hereby  irrevocably waives (i) any objections which it may now or hereafter have to the laying of the  venue of any suit, action or proceeding arising out of or relating to this Plan brought in any  court of competent jurisdiction in Salt Lake City, Utah, (ii) any claim that any such suit, action  or proceeding brought in any such court has been brought in any inconvenient forum and (iii)  any right to a jury trial.    001366-0016-13471-Active.16178760.5  

 

                                                                            29          (r)   Severability.  If any provision of the Plan or any Award or Award agreement is or  becomes or is deemed to be invalid, illegal, or unenforceable in any jurisdiction or as to any  person or entity or Award, or would disqualify the Plan or any Award under any law deemed  applicable by the Committee, such provision shall be construed or deemed amended to conform  to the applicable laws, or if it cannot be construed or deemed amended without, in the  determination of the Committee, materially altering the intent of the Plan or the Award, such  provision shall be construed or deemed stricken as to such jurisdiction, person or entity or  Award and the remainder of the Plan and any such Award shall remain in full force and effect.         (s)   Obligations Binding on Successors.  The obligations of the Company under the  Plan shall be binding upon any successor corporation or organization resulting from the merger,  consolidation or other reorganization of the Company, or upon any successor corporation or  organization succeeding to substantially all of the assets and business of the Company.         (t)   409A of the Code.                 (i)   Notwithstanding any provision of the Plan to the contrary, it is intended        that the provisions of this Plan comply with Section 409A of the Code, and all provisions        of this Plan shall be construed and interpreted in a manner consistent with the        requirements for avoiding taxes or penalties under Section 409A of the Code.  Each        Participant is solely responsible and liable for the satisfaction of all taxes and penalties        that may be imposed on or in respect of such Participant in connection with this Plan or        any other plan maintained by the Company (including any taxes and penalties under        Section 409A of the Code), and neither the Company nor any Affiliate or Subsidiary shall        have any obligation to indemnify or otherwise hold such Participant (or any beneficiary)        harmless from any or all of such taxes or penalties.  With respect to any Award that is        considered “deferred compensation” subject to Section 409A of the Code, references in        the Plan to “termination of employment” (and substantially similar phrases) shall mean        “separation from service” within the meaning of Section 409A of the Code.  For purposes        of Section 409A of the Code, each of the payments that may be made in respect of any        Award granted under the Plan is designated as separate payments.               (ii)  Notwithstanding anything in the Plan to the contrary, if a Participant is a        “specified employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code, no        payments in respect of any Awards that are “deferred compensation” subject to Section        409A of the Code and which would otherwise be payable upon the Participant’s        “separation from service” (as defined in Section 409A of the Code) shall be made to such        Participant prior to the date that is six (6) months after the date of such Participant’s        “separation from service” or, if earlier, the Participant’s date of death.  Following any        applicable six (6) month delay, all such delayed payments will be paid in a single lump        sum on the earliest date permitted under Section 409A of the Code that is also a business        day.               (iii) Unless otherwise provided by the Committee, in the event that the timing        of payments in respect of any Award (that would otherwise be considered “deferred        compensation” subject to Section 409A of the Code) would be accelerated upon the        occurrence of (A) a Change of Control, no such acceleration shall be permitted unless the    001366-0016-13471-Active.16178760.5  

 

                                                                            30          event giving rise to the Change of Control satisfies the definition of a change in the        ownership or effective control of a corporation, or a change in the ownership of a        substantial portion of the assets of a corporation pursuant to Section 409A of the Code        and any Treasury Regulations promulgated thereunder or (B) a Disability, no such        acceleration shall be permitted unless the Disability also satisfies the definition of        “Disability” pursuant to Section 409A of the Code and any Treasury Regulations        promulgated thereunder.         (u)   Clawback/Forfeiture.  Notwithstanding anything to the contrary contained herein,  an Award agreement may provide that the Committee may in its sole discretion cancel such  Award if the Participant, without the consent of the Company, while employed by or providing  services to the Company or any Affiliate or Subsidiary or after termination of such employment  or service, violates a non-competition, non-solicitation or non-disclosure covenant or agreement  or otherwise has engaged in or engages in conduct that constitutes “Cause” or conduct  contributing to any financial restatements or irregularities, as determined by the Committee in  its sole discretion.  The Committee may also provide in an Award agreement that if the  Participant otherwise has engaged in or engages in any activity referred to in the preceding  sentence, the Participant will forfeit any gain realized on the vesting or exercise of such Award,  and must repay the gain to the Company.  The Committee may also provide in an Award  agreement that if the Participant receives any amount in excess of what the Participant should  have received under the terms of the Award for any reason (including without limitation by  reason of a financial restatement, mistake in calculations or other administrative error), then the  Participant shall be required to repay any such excess amount to the Company.  Without  limiting the foregoing, all Awards shall be subject to reduction, cancellation, forfeiture or  recoupment to the extent necessary to comply with applicable law.         (v)   Expenses; Gender; Titles and Headings.  The expenses of administering the Plan  shall be borne by the Company and its Affiliates or Subsidiaries.  Masculine pronouns and other  words of masculine gender shall refer to both men and women.  The titles and headings of the  sections in the Plan are for convenience of reference only, and in the event of any conflict, the  text of the Plan, rather than such titles or headings shall control.       001366-0016-13471-Active.16178760.5

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