Document:

Unassociated Document

Exhibit 10.2

 

THE McCLATCHY COMPANY

BONUS RECOGNITION PLAN

 

(As in Effect Commencing as of July 25, 2011)

 

ARTICLE 1

PURPOSE

 

The McClatchy Company (the “Company”) has established The McClatchy Company Bonus Recognition Plan (the “Plan”) for the benefit of certain executives of the Company and its Affiliates.  The Plan was established effective February 4, 2009 (the “Effective Date”).  At the time, the Company intended that the Plan be treated as an unfunded plan of deferred compensation for purposes of the Internal Revenue Code of 1986, as amended (the “Code”) and the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), and as a plan for a select group of management and highly compensated employees for purposes of ERISA.

 

Effective as of July 25, 2011 (the “Restatement Effective Date”), the Company terminated the deferred compensation feature of the Plan, and converted the Plan to a program providing for immediate payment of retirement benefits to the Participants.  With respect to contributions by the Company on or after the Restatement Effective Date, the Plan shall no longer be an ERISA plan, but rather is intended to be a payroll practice plan described in Labor Regulation section 2510.3-1(b)(2) and also to satisfy the exemption under Labor Regulation section 2510.3-2(c).

 

ARTICLE 2

ELIGIBILITY AND PARTICIPATION

 

2.1           Eligibility

 

Eligibility to participate in the Plan is limited to those executives of the Company and its Affiliates who are designated from time to time by the Plan Administrator to participate in the Plan (each, a “Participant”).  Supplement A sets forth those individuals who have been designated as Participants as of the effective date.

 

2.2           Company Matching Contribution Amount

 

For each calendar year for which the Company makes a matching contribution to salaried employees under the 401(k) Plan generally, the Company will make a Company Matching Contribution under this Plan to each Participant who remains employed by the Company or its Affiliates on the last day of such calendar year, or who terminated employment with the Company and its Affiliates during the calendar year on account of Retirement or death.  No Company Matching Contribution shall be credited for a year to a Participant if the Participant is not employed by the Company or an Affiliate on the last day of the year and did not terminate employment during the year on account of Retirement or on account of death.

 

  

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2.3           Company Supplemental Contribution Amount

 

For each calendar year for which the Company makes a profit sharing contribution to salaried employees participating under the 401(k) Plan generally, except as next provided, the Company will make a Company Supplemental Contribution under this Plan to each Participant who remains employed by the Company or its Affiliates on the last day of such calendar year or who terminated employment with the Company and its Affiliates during the calendar year on account of Retirement or death.  However, if the Supplemental Contribution made under this Plan would prevent the Company from growing operating cash flow or achieving some other financial performance goals as determined by the Committee, then the Committee reserves the right in its sole discretion to determine if a Supplemental Contribution will be made.  In addition, no Company Supplemental Contribution shall be credited for a year to a Participant if the Participant is not employed by the Company or an Affiliate on the last day of the year and did not terminate employment during the year on account of Retirement or on account of death.

 

2.4           Vesting

 

A Participant’s benefit under this Plan shall vest in accordance with the following schedule based on his years of vesting service under the 401(k) Plan:

 

	
Years of Vesting Service

	
Vested Percentage

	
Less than 3

	
0%

	
3 or more

	
100%

 

A Participant who is an employee of the Company or its Affiliate on or after his Normal Retirement Age or who dies while an employee of the Company or its Affiliate shall become 100% vested in his or her Plan benefit, to the extent not already so vested.  A Participant shall forfeit any amount of his or her Plan benefit that is not vested as of his or her Termination Date.  Furthermore, notwithstanding anything to the contrary under this Plan, a Participant shall not be entitled to any payment with respect to any portion of his or her Plan benefit  that is forfeited under this Section 2.4.

 

ARTICLE 3

PAYMENT OF DEFERRED COMPENSATION

 

3.1           Three-Year Installment Payments and Termination Payment

 

                      Except in the event of the death, a Participant’s vested Deferred Compensation Account will be distributed in three substantially equal annual installments to him or her commencing in January of the calendar year following his or her Termination Date or, if later, as of the first day of the seventh month following his or her Termination Date.  Notwithstanding the preceding, the Company shall fully distribute a Participant’s vested Deferred Compensation Account as soon as reasonably practicable following July 25, 2012 (the “Termination Distribution”).

  

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3.2           Death

 

In the event of the death of a Participant, distribution of his or her Deferred Compensation Account shall be made entirely in accordance with Article 5 of the Plan.

 

ARTICLE 4

LEGACY DEFERRED COMPENSATION PLAN ACCOUNTS

 

4.1           Accounts

 

A bookkeeping Company contribution Deferred Compensation Account was established and is maintained by the Plan Administrator for each Participant who received contributions for calendar year 2010.  Amounts credited as Company Matching Contributions and Company Supplemental Contributions prior to the Restatement Effective Date were credited to the Deferred Compensation Accounts.

 

4.2           Investment Credits

 

Prior to the Termination Distribution of the account, Participants’ Deferred Compensation Accounts shall be adjusted to reflect increases or decreases based on credits to the Deferred Compensation Account representing performance of the Investment Index, in such manner as determined by the Plan Administrator in its sole discretion for all such accounts.  The Plan Administrator is authorized prospectively to replace or otherwise modify the Investment Index used under the Plan.

 

4.3           Valuation Date

 

Each Participant’s Deferred Compensation Account shall be valued as of each December 31, and on the last day of the month in which the Participant ceases to be an employee, at which point credits under Section 4.2 shall be made with respect to the Deferred Compensation Account balance remaining in the Plan as of the Valuation Date.  The Plan Administrator also may establish such other date or dates as Valuation Dates with respect to a Participant’s Deferred Compensation Account or particular investments in the Deferred Compensation Account.

 

4.4           Termination of Deferred Compensation Accounts.

 

All Deferred Compensation Accounts under the Plan shall be fully liquidated and distributed by July 24, 2013.  As of the date as of which all Termination Distributions under the Plan have been completed, there shall no longer be any Deferred Compensation Accounts under the plan, and this Article 4 and Article 5 shall cease to have effect.

 

ARTICLE 5

DEFERRED COMPENSATION DEATH BENEFITS

 

5.1           Death Benefit

 

A Participant may designate a Beneficiary or Beneficiaries to receive payment of his vested Deferred Compensation Account in the event of his death.  Each Beneficiary designation:  (i) shall be made on a form filed in the manner prescribed by the Plan Administrator, (ii) shall be effective when, and only if made and filed in such manner during the Participant’s lifetime, and (iii) upon such filing, shall automatically revoke all previous Beneficiary designations.  Upon the death of a Participant, the full amount of the Participant’s vested Deferred Compensation Account (or the remaining amount of the vested Deferred Compensation Account in the event that installment payments have commenced) shall be paid to the Participant’s Beneficiary in a single lump sum.

 

  

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5.2           Failure to Designate Beneficiary

 

If the payments to be made pursuant to this Article 5 are not subject to a valid Beneficiary designation at the time of the Participant’s death (because the designated Beneficiary predeceased the Participant or for any other reason), the estate of the Participant shall be the Beneficiary.  If a Beneficiary designated by the Participant to receive all or any part of the Participant’s Deferred Compensation Account dies after the Participant but before complete distribution of that portion of the Deferred Compensation Account, and at the time of the Beneficiary’s death there is no valid designation of a contingent Beneficiary, the estate of such Beneficiary shall be the Beneficiary of the portion in question.

 

ARTICLE 6

RETIREMENT PAYMENTS

 

Effective with respect to any Company Matching Contribution or Company Supplemental Contribution made with respect to calendar year 2011 or a later calendar year, payment shall be made to each Participant to whom such contribution is owed by March 15 of the calendar year following the calendar year to which the contribution relates or, if later, the calendar year following the year in which such amounts become vested.  The Company shall maintain a bookkeeping account to reflect the Plan benefit of any Participant who is not vested and has not forfeited his or her contributions.  In the case of unvested Participants there shall not be any interest or other investment performance credit to the account.

 

ARTICLE 7

CLAIMS PROCEDURE

 

7.1           Initial Claim

 

If a Participant believes he or she is entitled to payments under the Plan which have not been paid or have been paid in a lesser amount, the Participant may submit a written claim to the Plan Administrator.  If the Plan Administrator determines that the claim should be denied, written notice of the decision will be furnished to the Participant within a reasonable period of time.  This notice will set forth in clear and precise terms the specific reasons for the denial, specific reference to pertinent Plan provisions on which the denial is based, a description of additional material or information necessary for the Participant to perfect the claim, and an explanation of the Plan’s review procedure.  The written notice shall be given to the Participant within ninety (90) days after receipt of the claim, unless special circumstances require an extension of time for processing the claim, in which case a decision will be rendered and written notice furnished within one hundred eighty (180) days after receipt of the claim.  A written notice of such extension of time indicating the special circumstances and expected date of decision will be furnished to the Participant within the initial ninety (90) day period.

 

  

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7.2           Claims Appeal

 

The Participant may, within 60 days after receiving notice denying the claim, request a review of the decision by written application to the Committee.  The Participant may also review pertinent documents and submit issues and comments in writing.  A written decision on the appeal will be made by the Committee not later than 60 days after receipt of the appeal, unless special circumstances require an extension of time, in which case a decision will be rendered within a reasonable period of time, but in no event later than 120 days after receipt of the appeal.  A written notice of such extension of time will be furnished to the Participant before such extension begins.  The decision will include the specific reason(s) for the decision and the specific reference(s) to the pertinent plan provisions on which the decision is based.  The decision will be final.  A Participant’s Beneficiary also may use the claim procedures set forth in Section 7.1 and this Section.

 

ARTICLE 8

MANAGEMENT AND ADMINISTRATION

 

8.1           Administration

 

The Company shall serve as the Plan Administrator.  The Plan Administrator shall have the full power and authority to control and manage the operation and administration of the Plan, including the authority, in its sole discretion: (a) to promulgate and enforce such rules and regulations as deemed necessary or appropriate for the administration of the Plan; (b) to interpret the Plan consistent with the terms and intent thereof; and (c) to resolve any possible ambiguities, inconsistencies and omissions in the Plan.  All such actions shall be in accordance with the terms and intent of the Plan.

 

The Company may designate, by written instrument acknowledged by the parties, one or more persons to carry out its fiduciary responsibilities as Plan Administrator.  To the extent of any such delegation, the delegate shall become the Plan Administrator responsible for the matters assigned by the Company, and references to the Company in such capacity shall apply instead to the delegate.  Additionally, the Company may assign any of its responsibilities to specific persons who are directors, officers, or employees of the Company, or a committee composed of such persons, in order to execute its actions as the Plan Administrator.  Any action by the Company assigning any of its responsibilities to specific persons who are directors, officers, or employees of the Company, or a committee composed of such persons, shall not constitute delegation of the Company’s responsibility as Plan Administrator, but rather shall be treated as the manner in which the Company has determined internally to discharge such responsibility.  One such assignment is hereby made to the General Counsel, who shall have the power on behalf of the Company to execute plan documents, trust agreements or other contracts relating to the Plan or Plan administration.

 

The Plan Administrator may engage the services of accountants, attorneys, actuaries, consultants and such other professional personnel as deemed necessary or advisable to assist them in fulfilling responsibilities of the Plan Administrator under the Plan.  The Plan Administrator, and its delegates and assistants shall be entitled to act on the basis of all tables, valuations, certificates, opinions and reports furnished by such professional personnel.

 

  

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8.2           Amendment and Termination of the Plan

 

The Company may, in its sole discretion, amend this Plan at any time or from time to time, in whole or in part, and for any reason, by action of the Committee.  However, no amendment shall reduce the amount accrued in a Participant’s account as of the date of such amendment.  Effective as of the Restatement Effective Date, there was a complete termination of the Deferred Compensation Accounts.  The terminal distribution of Deferred Compensation Accounts shall be made in accordance with Article 3.

 

ARTICLE 9

GENERAL PROVISIONS

 

9.1           Alienation of Benefits

 

No amount payable under the Plan shall be subject to alienation, sale, transfer, assignment, pledge, attachment, garnishment, lien, levy or like encumbrance.  Neither the Company nor the Plan shall in any manner be liable for or subject to the debts or liabilities of any person entitled to payment under the Plan.

 

9.2           Overpayments

 

If any overpayment is made under the Plan, (a) the amount of the overpayment may be set off against further amounts payable to or on account of the Participant until the overpayment has been recovered in full, or (b) the Participant shall be required to return the amount of the overpayment to the Plan Administrator.  The foregoing remedy is not intended to be exclusive.

 

9.3           Withholding Taxes

 

The Company and the Plan Administrator shall withhold such taxes and make such reports to governmental authorities as they reasonably believe to be required by law.

 

9.4           Distributions to Minors and Incompetents

 

If the Plan Administrator determines that a Participant or any Beneficiary receiving or entitled to receive payment under the Plan is incompetent to care for his or her affairs, and in the absence of the appointment of a legal guardian of the property of the incompetent, payments due under the Plan (unless prior claim thereto has been made by a duly qualified guardian, committee or other legal representative) may be made to the spouse, parent, brother or sister or other person, including a hospital or other institution, deemed by the Plan Administrator to have incurred or to be liable for expenses on behalf of such incompetent.  In the absence of the appointment of a legal guardian of the property of a minor, any minor’s share of an amount under the Plan may be paid to such adult or adults as in the opinion of the Plan Administrator have assumed the custody and principal support of such minor.

 

  

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The Plan Administrator, however, in its sole discretion, may require that a legal guardian for the property of any such incompetent or minor be appointed before authorizing the payment of the Plan benefit in such situations.  Benefit payments made under the Plan in accordance with determinations of the Plan Administrator pursuant to this Article 8 shall be a complete discharge of any obligation arising under the Plan with respect to such benefit payments.

 

9.5           No Right to Employment

 

Nothing contained in this Plan shall be deemed to give any employee the right to be retained in the service of the Company or to interfere with the right of the Company to demote, discharge or discipline any employee at any time without regard to the effect that such demotion, discharge or discipline may have upon the employee under the Plan.

 

9.6           Unfunded Plan

 

The Plan shall be an unfunded, unsecured obligation of the Company.  The Company shall not be required to segregate any assets to provide payment of a Participant’s Plan benefit, and the Plan shall not be construed as providing for such segregation.  Any liability of the Company with respect to the payment of a Participant’s Plan benefit shall be based solely upon any contractual obligations created by the Plan.  Any such obligation shall not be deemed to be secured by any pledge or other encumbrance or any property of the Company.

 

9.7           Change in Control; Merger or Other Reorganization

 

The Company may assign its obligations under this Plan to a successor, whether by merger, consolidation, asset sale or other business reorganization or transaction (“Business Transaction”).  The obligations also may transfer to a successor in a Business Transaction by operation of law.  The transfer of a Participant to a successor in connection with a Business Transaction shall not result in the Participant being treated as terminating employment or ceasing to be an employee, if the Company assigns its obligations under this Plan to the successor or if the obligations are assigned by operation of law.  Thereafter, this Plan shall be binding upon and shall inure to the benefit of any successor of the Company, resulting from the Business Transaction.  Alternatively, in the case of a Business Transaction that is a Change in Control, the Company may determine to terminate the Plan and distribute all benefits as soon as reasonably practicable thereafter, provided the termination and distribution comply with the requirements of Section 409A of the Code.

 

9.8           Miscellaneous

 

(a)           Construction

Unless the contrary is plainly required by the context, wherever any words are used herein in the masculine gender, they shall be construed as though they were also used in the female gender, and vice versa, and wherever any words are used herein in the singular form, they shall be construed as though they were also used in the plural form, and vice versa.  Furthermore, the terms of this Plan shall be construed in accordance with Section 409A of the Code so as to avoid the imposition of the penalty tax under Section 409A, and, in the event of any inconsistency between the Plan and Section 409A of the Code, Section 409A shall control.

 

  

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(b)           Severability

 

If any provision of the Plan is held illegal or invalid for any reason, such illegality or invalidity shall not affect the remaining parts of the Plan, and the Plan shall be construed and enforced as if such illegal or invalid provision had never been included in it.

 

(c)           Titles and Headings Not to Control

 

The titles to Articles and the headings of Sections in the Plan are for convenience of reference only, and in the event of any conflict, the text of the Plan, rather than the titles or headings, shall control.

 

(d)           Complete Statement of Plan

 

This document is a complete statement of the Plan.  The Plan may be amended, modified or terminated only in writing and then only as provided herein.

 

9.9           Governing Law

 

The Plan shall be governed by ERISA, and to the extent not preempted by ERISA, the laws of the State of California without regard to its choice of law provisions.

 

ARTICLE 10

DEFINITIONS

 

In addition to those definitions set forth in Article 1 or otherwise in the text of this Plan, the following terms shall have the meaning assigned below in this Article 10:

10.1           “Affiliate” means any entity which is part of the same "controlled group" as the Company, as determined under Sections 414(b) or (c) of the Code.  An entity shall be treated as an Affiliate only while a member of the controlled group that includes the Company.

 

10.2           “Beneficiary” means the person or persons designated by the Participant to receive payment of the amounts provided in the Plan in the event of his death.  Each Beneficiary designation:  (i) shall be made on a form filed in the manner prescribed by the Plan Administrator, (ii) shall be effective when, and only if made and filed in such manner during the Participant's lifetime, and (iii) upon such filing, shall automatically revoke all previous Beneficiary designations.

10.3           “Board” means the Board of Directors of the Company.

10.4           “Bonus” means the Executive’s annual incentive payment, if any.  The term “Bonus” excludes any payment in respect of a long-term incentive or a special or retention bonus.

  

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10.5           “Change in Control” means the occurrence of any of the following: (i) the sale, lease, conveyance or other disposition of all or substantially all of the Company's assets to any "person" (as such term is used in Section 13(d) of the Securities Exchange Act of 1934, as amended), entity or group of persons acting in concert; (ii) any "person" or group of persons (other than any member of the McClatchy family or any entity or group controlled by one or more members of the McClatchy family) becoming the "beneficial owner" (as defined in Rule 13d-3 under said Act), directly or indirectly, of securities of the Company representing 50% or more of the total voting power represented by the Company's then outstanding voting securities; (iii) a merger or consolidation of the Company with any other corporation, other than a merger or consolidation that would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its controlling entity) at least 50% of the total voting power represented by the voting securities of the Company or such surviving entity (or its controlling entity) outstanding immediately after such merger or consolidation; (iv) a contest for the election or removal of members of the Board that results in the removal from the Board of at least 50% of the incumbent members of the Board, or (v) the occurrence of a "Rule 13e-3 transaction" as such term is defined in Rule 13e-3 promulgated under the Securities Exchange Act of 1934, as amended, or any similar successor rule.

10.6           “Code” means the Internal Revenue Code of 1986, as amended.

10.7           “Committee” means the Compensation Committee of the Board.

10.8           “Company” means The McClatchy Company.

10.9           “Company Matching Contribution” means, with respect to each calendar year, the Company contribution on behalf of a Participant equal to the maximum rate of matching contribution applied under the 401(k) Plan for such calendar year multiplied by the Participant’s Bonus for the calendar year.

10.10           “Company Supplemental Contribution” means, with respect to each calendar year, the Company contribution on behalf of a Participant equal to the supplemental contribution percentage applied under the 401(k) Plan for the Participant for such year, if any, multiplied by the Participant’s Bonus for the calendar year.

10.11           “Deferred Compensation Account” means the book entry account established under the Plan for a Participant in which shall be reflected all Company Matching Contributions and Company Supplemental Contributions credited to the Plan with respect to the 2010 calendar year and allocable returns and losses under Article 4 of the Plan.

10.12            “ERISA” means the Employee Retirement Income Security Act of l974, as amended.

 

10.13            “Investment Index” means the investment measure selected by the Company for use under the Plan, as set forth in Supplement B.

 

  

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10.14           “Normal Retirement Age” means age 65.

 

10.15            “Plan Administrator” means the Company.

 

10.16           “Retirement” means, with respect to a Participant, “Retirement” as defined under the 401(k) Plan, which in addition to service criteria requires the Participant to terminate employment with the Company and its Affiliates on or after attainment of age 55.

10.17            “Separation from Service” means termination of a Participant’s employment with the Company and its Affiliates by reason of death, retirement, Disability, resignation or discharge; provided, further, that such termination would constitute a “separation from service” within the meaning of Treasury Regulations section 1.409A-1(h) or any amendment or successor thereto in accordance with the default rules thereunder.  Accordingly, a Participant shall be considered to have experienced a termination of employment when the facts and circumstances indicate that the Participant and the Company reasonably anticipate that either (i) no further services will be performed for the Company and its Affiliates after a certain date, or (ii) that the level of bona fide services the Participant will perform for the Company and its Affiliates after such date will permanently decrease to no more than 20% of the average level of bona fide services performed by Participant over the immediately preceding 36-month period.  If a Participant is on military leave, sick leave, or other bona fide leave of absence, the employment relationship between the Participant and the Company or an Affiliate shall be treated as continuing intact, provided that the period of such leave does not exceed 6 months, or if longer, so long as the Participant retains a right to reemployment with the Company or an Affiliate under an applicable statute or by contract.

10.18           “Termination Date” means the date the Participant has a Separation from Service.

10.19           "Valuation Date" means the date or dates as of which Deferred Compensation Accounts are valued, as set forth in Section 4.3.

10.20            “Years of Vesting Service” means, with respect to a Participant, the number of years credited to the Participant for vesting purposes under the 401(k) Plan.

10.21            “401(k) Plan” means The McClatchy Company Deferred Compensation and Investment Plan as in effect on December 31, 2009, or any successor thereto, as such plan may later be amended from time to time.

 

*           *           *           *           *

 

  

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To reflect the termination of the deferred compensation feature under this Plan by the Committee and its conversion to a program of immediate retirement payments, effective as of July 25, 2011, the authorized officer hereby executes this Plan document on behalf of the Company.

 

 

 

	
 

	
 

	
By: 

	
 

	
 

	 	 	Name:	 	 
	 	 	Title:	 	 

 

  

11Unassociated Document

EXHIBIT 10.1

  

  

 

Exhibit 10.1

 

ATEL 15, LLC

 

ESCROW AGREEMENT

 

_________, 2011

 

U. S. Bank, National Association

San Francisco, California

 

Gentlemen:

 

ATEL 15, LLC, a California limited liability company (the “Fund”), proposes to make a public offering through ATEL Securities Corporation (the “Dealer Manager”) and other registered broker-dealers (the “Selected Dealers”) of not to exceed 15,000,000 of its units of limited liability company member interest (the “Units”) at $10 per Unit. The offering shall be conducted on a best-efforts all-or-none basis for the first 120,000 Units and thereafter on a best-efforts basis for the remaining Units. The offering shall commence at such time as the Fund’s registration statement on Form S-1 with respect thereto (the “Registration Statement”) is declared effective by the Securities and Exchange Commission (“SEC”) which is currently expected to occur on or about October 10 , 2011. We are requesting that you consent to act as Depository in connection with the offering.

 

As Depository, you shall receive, hold in escrow and disburse subscription funds in accordance with the terms and conditions set forth in this letter and in the “Plan of Distribution” section of the prospectus included in the Registration Statement, as amended or supplemented (such prospectus in the form first filed with the SEC pursuant to Rule 424 under the Securities Act of 1933, as amended, and any supplement or amendment to such prospectus thereafter so filed pursuant to such Rule 424 are hereinafter collectively called the “Prospectus”).

 

Upon request of ATEL Managing Member LLC (the “Manager”) or the Dealer Manager, you shall provide reports to the Fund and the Dealer Manager as to the number and amount of subscriptions received by you.

 

The terms and conditions of your engagement as Depository shall be as follows:

 

1. On or before the date of commencement of the offering you shall establish an interest-bearing escrow account which shall be entitled “ATEL 15 Escrow Account” (the “Escrow Account”). The Dealer Manager and Selected Dealers shall instruct subscribers to make checks payable to the order of the Depository. You shall return any checks received that are made payable to a party other than the Depository to the Dealer Manager or Selected Dealer who submitted the check.

 

2. The Dealer Manager and the Selected Dealers shall promptly deliver all monies received for the payment of Units to the Depository for deposit in the Escrow Account. You shall receive and hold deposits of subscription funds in the amount of $10 per Unit. The minimum subscription shall be 500 Units ($5,000), subject, however, to such higher minimum subscriptions as are described in the Prospectus as being applicable in certain circumstances. Each deposit shall be accompanied by a Subscription Agreement in the form of that attached as Exhibit C to the Prospectus identifying by name and address the subscriber whose funds are deposited and the amount of the funds deposited by such subscriber.

 

3. Deposits in the form of checks which fail to clear the bank upon which they are drawn shall be returned by the Depository to the subscriber, together with the copy of the Subscription Agreement. You shall concurrently furnish to the Manager and the Dealer Manager a copy of any such Subscription Agreement and check so returned. The Depository shall have no further liability therefor.

 

If the Fund rejects any subscription for which the Depository has already collected funds, the Depository shall promptly issue a refund check to the rejected subscriber. If the Fund rejects any subscription for which the Depository has not yet collected funds but has submitted the subscriber’s check for collection, the Depository shall promptly issue a check in the amount of the subscriber’s check to the rejected subscriber after the Depository has cleared such funds. If the Depository has not yet submitted a rejected subscriber’s check for collection, the Depository shall promptly remit the subscriber’s check directly to the subscriber.

 

4. You shall place funds from the Escrow Account only in the following interest-bearing accounts and short-term obligations as the Fund shall direct: short-term United States government securities, including Treasury bills, securities issued or guaranteed by United States government agencies, certificates of deposit and time or demand deposits in banks and savings and loan associations which are insured by United States government agencies or deposits in members of the Federal Home Loan Bank System; provided, however, that you shall not be required to place any such funds in a manner which is inconsistent with the Prospectus. In the absence of express instructions, you will invest such funds, to the extent reasonably practicable, in a U. S. Bank Money Market Account insured by the FDIC. As Depository you shall not be liable for any loss of interest in the event funds are withdrawn prior to maturity. Interest accrued on subscription funds held in the Escrow Account shall not be an asset of the Fund, but shall either (i) be paid to the respective subscribers upon return of subscription proceeds to subscribers pursuant to paragraph 5 of this Agreement in the event the Minimum Subscriptions (as defined in paragraph 5) are not received prior to termination of the offering); or (ii) be paid to the Fund upon release of subscription proceeds to the Fund for disbursement by the Fund to subscribers, in either case to be divided among the subscribers on a pro rata basis according to the respective numbers of days between the time of deposit of their payments into the Escrow Account and the release of such payments to the Fund or the return thereof to the subscribers, and in either case with the amounts of interest allocated among subscribers to be calculated by the Manager.

  

  

 

 

During the escrow period, the proceeds from the Fund’s offering are not subject to claims by creditors, the Fund, the Fund’s affiliates, you as the escrow agent, or Selected Dealers unless and until the proceeds have been released to the Fund pursuant to the terms of this Agreement.

 

5. If and at such time as amounts in collected funds representing subscriptions for not less than 120,000 Units shall have been deposited with you under this Agreement (the “Minimum Subscriptions”), you shall so notify the Manager and the Dealer Manager and upon receipt of written instructions from each of the Fund and the Dealer Manager, you shall disburse to the Fund all subscription funds held by you. If the offering is terminated prior to receipt of collected funds representing the Minimum Subscriptions, or if collected funds representing the Minimum Subscriptions have not been received on or before the date which is one year from the date that the Registration Statement is declared effective by the SEC, you shall promptly disburse all subscription funds to the subscribers who transmitted them without deduction, penalty or expense to the subscriber, and you shall advise the Fund and the Dealer Manager that you have done so. The subscription funds returned to each subscriber shall be free and clear of any and all claims of the Fund or any of its creditors. In any case, all interest earned on subscription proceeds held by you shall be disbursed to subscribers as provided in paragraph 4, with the Manager providing the Depository with the calculation of interest payable to each subscriber. After all disbursements under this Agreement have been completed, the escrow shall be terminated; provided, however, that an agreement with a branch of Depository will be effective upon escrow holder notifying the branch that the Minimum Subscriptions have been reached and escrow is closed. The branch will agree to facilitate transfers of subscription funds to the Fund in the event subscribers make checks payable to the Depository after the date Minimum Subscriptions have been received. The branch’s sole function in such event shall be to endorse any such subscription checks to the account of the Fund.

 

For purposes of the foregoing, the term “collected funds” shall mean all funds received by the Depository which have cleared normal banking channels and are in the form of cash.

 

Notwithstanding the foregoing, any and all subscription proceeds from Pennsylvania investors deposited with the Depositary will be maintained in a separate escrow account entitled “ATEL 15 Pennsylvania Escrow Account.” The terms of the escrow for Pennsylvania subscriptions will be the same as provided for all subscription proceeds under this Agreement, except as expressly stated in the following paragraphs.

 

The amount of subscription proceeds held in the Pennsylvania Escrow Account will not be counted in determining the Minimum Subscriptions defined above in this Section 5, unless the Pennsylvania Minimum (as defined below) is reached prior to the date that the amount of the Minimum Subscriptions is received from non-Pennsylvania subscribers. The funds in the Pennsylvania Escrow Account will be retained in such account, and will not be released to the Fund upon the release of other escrowed funds at the time the Minimum Subscriptions are reached under the Agreement unless the conditions for release of Pennsylvania subscriptions set forth in this paragraph are first satisfied. If and at such time as the Fund and the Dealer Manager deliver to the Depositary a certificate, together with any other documentation that the Depositary may reasonably require, which demonstrates that the Fund has received a total amount in collected funds which, when added to the total amount held in the Pennsylvania Escrow Account, represent aggregate subscriptions for not less than 750,000 Units (the “Pennsylvania Minimum”), and upon receipt of written instructions from each of the Fund and the Dealer Manager, the Depositary shall disburse to the Fund all subscription funds held in the Pennsylvania Escrow Account.

 

If the offering is terminated prior to receipt of collected funds representing the Pennsylvania Minimum, or if collected funds representing the Pennsylvania Minimum have not been received on or before the date which is 120 days after the date hereof, the Fund and the Dealer Manager will notify each Pennsylvania investor whose subscription proceeds are held in the Pennsylvania Escrow Account within 10 calendar days following the end of such period that such investor has the right to have the escrowed subscription proceeds returned to the investor by notifying the Depositary that such return is desired within 10 calendar days after receipt of such notification of the right to such return. The subscription proceeds held for investors so requesting a return, together with any interest accrued thereon, will be promptly forwarded to such investors, but in no event later than 15 calendar days following receipt by the Depositary of the notice requesting such return.

 

Any subscription proceeds from Pennsylvania investors which remain in the escrow after the expiration of the periods described in the foregoing paragraph will be held until the earlier of the satisfaction of the Pennsylvania Minimum condition or the termination of the offering; provided that at the end of each subsequent 120-day period of the escrow, the investors whose subscription proceeds remain in the escrow will be offered the return rights described in the foregoing paragraph; and provided further that, if the Pennsylvania Minimum is not satisfied within one year from the date that the Registration Statement is declared effective by the SEC, the Depositary shall promptly disburse all subscription funds in the Pennsylvania Escrow Account to the subscribers who transmitted them without deduction, penalty or expense to the subscriber, and the Depositary shall advise the Fund and the Dealer Manager that the Depositary has done so. Any such disbursements to Pennsylvania investors will be on the same terms as all disbursements under this Agreement.

  

  

 

 

6. All fees, costs, and charges of the Depository shall be paid by the Fund. Escrow fees shall be as set forth in Exhibit A hereto. No fees, costs, charges, indemnification for damages suffered by the Depository or any monies whatsoever shall be paid out of or chargeable to the funds on deposit in the Escrow Account.

 

7. The Fund and the Dealer Manager hereby represent and warrant that neither they nor any of their affiliates has made, nor will any such person make, any representation which might imply that you in any way endorse or recommend an investment in Units or guarantee any obligations relating to the Units except those expressly undertaken as Depositary under this Agreement.

 

In consideration of your acting as Depository herein, it is agreed that you shall in no case or event be liable for the failure of any of the conditions of this Agreement or damage caused by the exercise of your discretion in any particular manner, or for any other reason, except gross negligence or willful misconduct with reference to the Escrow Account, and you shall not be liable or responsible for your failure to ascertain the terms or conditions, or to comply with any of the provisions of, any agreement, contract or other document filed herewith or referred to herein, nor shall you be liable or responsible for forgeries or false impersonation.

 

It is further agreed that if any controversy arises between the parties hereto or with any third person with respect to the subject matter of this Agreement, or its terms or conditions, you are entitled at your option to refuse to comply with any claim or demand, so long as such controversy continues and in so doing you shall not be or become liable for damages or interest to any party for your failure or refusal to comply with any conflicting or adverse demands. You shall be entitled to continue so to refrain and refuse so to act until:

 

A. The rights of the adverse claimants have been finally adjudicated in a court assuming and having jurisdiction of the parties and the money, papers and property involved herein or affected hereby; and/or

 

B. All differences shall have been adjusted by agreement and you shall have been notified thereof in writing by all of the persons interested.

 

In the event of any such controversy, you, in your discretion, may file a suit in interpleader for the purpose of having the respective rights of the claimants adjudicated, and deposit with the court all documents and property held hereunder, and the Fund agrees to pay all costs and counsel fees incurred by you in such action and said costs and fees shall be included in the judgment in any such action.

 

You shall not be required to take or be bound by notice of any default of any person, or to take any action with respect to such default involving any expense or liability, unless notice of such default is given to you in writing by the Manager and unless you are indemnified in a manner satisfactory to you against such expense or liability.

 

You shall be protected in acting upon any notice, request, waiver, consent, receipt or other paper or document reasonably believed by you to be signed by the proper party or parties.

 

You may consult with legal counsel if any controversy arises, and you shall incur no liability and shall be fully protected in acting in accordance with the opinion and instructions of counsel.

 

In the event that you perform any service not specifically provided hereinabove, or there is any assignment or attachment of any interest in the subject matter of this Agreement or modification thereof, or any controversy arises hereunder, or you are named a party to, or are required to intervene in, any litigation pertaining to this escrow or the subject matter thereof, you shall be reasonably compensated therefor and reimbursed for all costs and expenses, including attorney’s fees, occasioned thereby.

 

8. The Fund, the Manager and the Dealer Manager represent and agree that none has made nor will any of them in the future make any representation that states or implies that the Escrow Agent has endorsed, recommended or guaranteed the purchase, value, or repayment of the Units offered for sale by the Fund. The Fund further agrees that it will insert in any prospectus, offering circular, advertisement, subscription agreement or other document made available to prospective purchasers of the Units the following in bold face type: “U.S. Bank National Association is acting only as an escrow agent in connection with the offering of the Units, and has not endorsed, recommended or guaranteed the purchase, value or repayment of such Units”, and will furnish to the Escrow Agent a copy of each such prospectus, offering circular, advertisement, subscription agreement or other document at least 5 business days prior to its distribution to prospective purchasers of the Securities”.

 

9. The Depository may resign upon the giving of 30 days’ written notice to the Manager and the Dealer Manager. The Depository may be removed by the Manager and the Dealer Manager, acting jointly, upon 30 days’ prior written notice to the Depository. In such event, it shall be the obligation of the Manager, with the consent of the Dealer Manager, to appoint a successor Depository. The Depository shall turn over to such successor, at the direction of the Fund, all funds, accounts and records held by the Depository pursuant to this Agreement.

  

  

 

 

Any change in the aforesaid terms and conditions shall require the consent of the Dealer Manager. In the event that any questions arise as to the interpretation of such terms and conditions, you shall be authorized to rely upon telegraphic or written instructions from the Dealer Manager and the Manager.

 

If you consent and agree to act as Depository on the terms and conditions set forth above, please so signify by causing a duly authorized officer or employee to sign the enclosed copy of this letter as indicated below and return it to the undersigned, whereupon the terms and conditions of this letter shall constitute an agreement between us. This agreement may be signed in separate counterparts, each of which when so executed and delivered shall be an original for all purposes, but all such counterparts shall constitute one and the same instrument.

 

	
Very truly yours,

	  
	
ATEL 15, LLC,

a California limited liability company

	  	  
	
By:

	
ATEL Managing Member, LLC, Manager

	  	  	  
	  	
By:

	
ATEL Capital Group, LLC

	  	  	  
	  	  	
By:

	  
	  	  	  	
(Name and Title)

	  
	
ATEL SECURITIES CORPORATION,

a California corporation, Dealer Manager

	  	
By:

	  
	  	  	
(Name and Title)

 

We hereby consent to act as Depository on the terms and conditions set forth above. Executed this __ day of _______, 2011.

 

	
U. S. Bank, National Association

	  	  
	
By:

	  
	  	  
	  	
(Name and Title)

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