UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): August 27, 2014 (August 27, 2014)
OM GROUP, INC.
(Exact Name of Registrant as Specified in Charter)
Delaware | 001-12515 | 52-1736882 | ||
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
950 Main Avenue, Suite 1300, Cleveland, Ohio | 44113 | |
(Address of Principal Executive Offices) | (Zip Code) |
Registrants telephone number, including area code: (216) 781-0083
N/A
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions (see General Instruction A.2.):
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
(e) On August 27, 2014, the Board of Directors of OM Group, Inc. approved the following forms of award agreements, which will be used for grants made under the OM Group, Inc. 2014 Equity and Incentive Compensation Plan: U.S. and International Non-Qualified Stock Option Agreements; U.S. Performance-Based Restricted Stock Agreement; International Performance-Based Restricted Stock Units Agreement; and U.S. and International Time-Based Restricted Stock Units Agreements. The forms of these award agreements are attached as Exhibits 10.1 through 10.6. A brief description of the terms and conditions of the forms of award agreements is below.
Form of U.S. and International Non-Qualified Stock Option Agreements: Options vest and become exercisable in equal installments on each anniversary of the grant date during the vesting period, provided that the participant remains continuously employed by the Company or its subsidiaries for the entirety of the vesting period. In the event that the participant dies while employed by the Company or any subsidiary, or if the participant ceases to be employed by the Company or a subsidiary due to disability (as defined in the agreement), then any option granted under the award agreement will vest immediately and become fully exercisable for the shorter of a period of three years or until the option expires. If the participant retires in accordance with any retirement plan of the Company or its subsidiaries, the option will vest and become fully exercisable for the shorter of a period of five years or until the option expires. In the event of a change of control of the Company, the option will vest immediately and become fully exercisable, unless the successor after the change in control grants a replacement award of the same type and at least equal value to the participant. If the participant ceases to be employed by the Company or a subsidiary for reasons other than those described above, the option will cease vesting, and the participant may exercise the option (to the same extent the participant was entitled to exercise the option immediately prior to such termination) for the shorter of a period of 90 days or until the option expires. If the participants employment is terminated due to a violation of the Companys Code of Conduct and Ethics, the option will be forfeited.
Form of International Performance-Based Restricted Stock Units Agreement: Performance-based Restricted Stock Units (PRSUs) vest upon relative achievement of management objectives specified by the Compensation Committee for a performance period, subject to the participants continued employment with the Company or its subsidiaries. The percentage of the PRSUs earned by the participant is determined by reference to a performance matrix approved by the Compensation Committee. If achievement of one of the performance targets is between the performance levels specified in the performance matrix, the applicable percentage of PRSUs that will be earned by the participant for that particular performance target will be determined using straight-line mathematical interpolation. To the extent that the participant does not achieve the performance targets by the end of the performance period, the PRSUs will be forfeited without compensation. If the participant retires, dies or becomes disabled during the performance period, then a pro-rata number of PRSUs will remain eligible for vesting after the end of the performance period. The remainder of the PRSUs will be forfeited without compensation. Upon a change of control of the Company during the performance period, the PRSUs will vest at the target level, unless the successor after the change of control provides the participant with a replacement award of the same type and at least equal value. Vested PRSUs will be settled by a single lump sum cash payment equal to the market value per share of one share of common stock for each vested PRSU. The participant is entitled to additional PRSUs as dividend equivalents if the Company pays a cash dividend to holders of its common stock. If the participant is terminated for a violation of the Companys Code of Conduct and Ethics or ceases to be employed by the Company or a subsidiary for reasons other than those described above, then any PRSUs that have not vested will be forfeited without compensation.
Form of U.S. Performance-Based Restricted Stock Agreement: Restricted stock vests upon achievement of management objectives specified by the Compensation Committee for a performance period, subject to the participants continued employment with the Company or its subsidiaries. The percentage of the restricted stock grant earned by the participant is determined by reference to a performance matrix approved by the Compensation Committee. If achievement of one of the performance targets is between the performance levels specified in the performance matrix, the applicable percentage of restricted stock that will be earned by the participant for that particular performance target will be determined by using straight-line mathematical interpolation. To the extent that the participant does not achieve the performance targets by the end of the performance period, the restricted stock will be forfeited without compensation. If the participant retires, dies or becomes disabled during the performance period, then a pro-rata number of shares of restricted stock will remain eligible for vesting after the end of the performance period. The remainder of the restricted stock will be forfeited without compensation. Upon a change of control of the Company during the performance period, the restricted stock will vest at the target level (50% of the restricted stock grant), unless the successor after the change of control provides the participant with a replacement award of the same type and at least equal value. The participant will be entitled to exercise voting rights pertaining to the restricted stock from the date of the grant. If the Company pays dividends on its common stock before the participants restricted stock has vested, dividends on the participants restricted stock will be held by the Company or its agent and distributed to the participant when the restricted stock vests. If the participant is terminated for a violation of the Companys Code of Conduct and Ethics or ceases to be employed by the Company or a subsidiary for reasons other than those described above, then any restricted stock that has not vested will be forfeited without compensation.
Form of U.S. and International Time-Based Restricted Stock Units Agreements: Restricted stock units (RSUs) vest fully on the vesting date specified by the Compensation Committee, subject to the participants continued employment with the Company or its subsidiaries until the vesting date. If the participant retires from the Company or a subsidiary in accordance with any retirement plan of the Company or its subsidiaries, the RSUs will vest. If the participant dies or becomes disabled, a pro-rata number of the RSUs will vest immediately, and the rest will be forfeited without compensation. In the event of a change of control, the RSUs will vest immediately, unless the successor after the change of control offers the participant a replacement award of the same type and at least equal value. Under the International Time-Based Restricted Stock Unit Agreement, vested RSUs will be settled with a single lump sum cash amount equal to the market value per share of one share of common stock for each vested RSU. Under the U.S. Time-Based Restricted Stock Unit Agreement, vested RSUs will be settled with one share of common stock for each vested RSU. If the Company pays a cash dividend to the holders of its common stock, the participant will be entitled to receive dividend equivalents in the form of additional RSUs. If the participant is terminated for a violation of the Companys Code of Conduct and Ethics or ceases to be employed by the Company or a subsidiary for reasons other than those described above, any RSUs that have not vested will be forfeited without compensation.
The award agreements described above are subject to the terms and conditions of the Plan. The descriptions above are qualified in their entirety by the forms of agreements attached as Exhibits 10.1 through 10.6.
Item 9.01 | Financial Statements and Exhibits |
Exhibit |
Description | |
10.1 | Form of International Non-Qualified Stock Option Agreement | |
10.2 | Form of International Performance-Based Restricted Stock Units Agreement | |
10.3 | Form of International Time-Based Restricted Stock Units Agreement | |
10.4 | Form of U.S. Non-Qualified Stock Option Agreement | |
10.5 | Form of U.S. Performance-Based Restricted Stock Agreement | |
10.6 | Form of U.S. Time-Based Restricted Stock Units Agreement |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
OM GROUP, INC. | ||||||
Date: August 27, 2014 | By: | /s/ Valerie Gentile Sachs | ||||
Name: | Valerie Gentile Sachs | |||||
Title: | Vice President, General Counsel and Secretary |
Exhibit 10.1
Form of International Non-Qualified Stock Option Agreement (2014 Plan)
OM GROUP, INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
THIS NON-QUALIFIED STOCK OPTION AGREEMENT (the Agreement), dated as of , 201 , is by and between OM GROUP, INC. (the Company) and (the Participant). All terms used in this Agreement with initial capital letters and not otherwise defined in this Agreement that are defined in the Companys 2014 Equity and Incentive Compensation Plan (the Plan) shall have the meanings assigned to them in the Plan.
WHEREAS, the Company maintains the Plan for the purpose of attracting and retaining non-employee Directors, officers and other key executives and employee of the Company and its Subsidiaries and to provide to such persons incentives and rewards for performance;
WHEREAS, pursuant to the Plan, and subject to the terms and conditions thereof and the terms and conditions hereinafter set forth, this Agreement evidences and memorializes the Companys grant to the Participant, effective as of , 201 (the Date of Grant) of an Option Right (the Option) to purchase shares of Common Stock at an Option Price of $ per share, which represents at least the Market Value per Share on the Date of Grant (the Option Exercise Price); and
WHEREAS, the Option is intended to constitute a non-qualified stock option and shall not be treated as an incentive stock option within the meaning of that term under Section 422 of the Code.
NOW, THEREFORE, the Company and the Participant agree as follows:
Section 1. Normal Vesting and Exercise. Except as otherwise provided in Sections 2, 3, 4, 5, 6, 7 and 9, the Option will vest and become exercisable in substantially equal installments on each of the first anniversaries of the Date of Grant if the Participant remains continuously employed by either the Company or any Subsidiary until such dates (such -year period, the Vesting Period). For purposes of this Agreement, the continuous employment of the Participant with the Company or any Subsidiary will not be deemed to have been interrupted, and the Participant shall not be deemed to have ceased to be an employee of the Company or any Subsidiary, by reason of the transfer of the Participants employment among the Company and its Subsidiaries. To the extent the Option is exercisable, it may be exercised in whole or in part.
Section 2. Accelerated Vesting and Exercisability Upon Death. If the Participant shall die while employed by the Company or any Subsidiary, to the extent that the Option has not previously been forfeited, the Option will fully vest and become fully exercisable, and the person entitled by will or the applicable laws of descent and distribution to exercise the Option on behalf of the Participant may exercise the Option for a period of three years following the Participants death or until the expiration of the stated term of the Option, whichever period is shorter.
Section 3. Accelerated Vesting and Exercisability in Connection with Disability. If the Participant ceases to be employed by the Company or any Subsidiary due to the Disability of the Participant, to the extent that the Option has not previously been forfeited, the Option will fully vest and become fully exercisable, and the Participant may exercise the Option for a period of three years following such date of the cessation of the Participants employment due to Disability or until the expiration of the stated term of the Option, whichever period is shorter. For purposes of this Agreement, the Participant shall be considered to have a Disability if the Participant has qualified for a long-term disability benefit under a disability plan or program of the Company or, in the absence of a disability plan or program of the Company, under a government-sponsored disability program, and is disabled within the meaning of Section 409A(a)(2)(C) of the Code.
Section 4. Accelerated Vesting and Exercisability Upon Retirement. If the Participant ceases to be employed by the Company or any Subsidiary due to the Participants retirement in accordance with any retirement plan or policy of the Company or any Subsidiary (Retirement), to the extent that the Option has not previously been forfeited, the Option will fully vest and become fully exercisable, and the Participant may exercise the Option for a period of five years following such Retirement or until the expiration of the stated term of the Option, whichever period is shorter.
Section 5. Exercisability Upon Death After Retirement or Termination due to Disability. If the Participant shall die following the cessation of employment with the Company or any Subsidiary, and such death occurs within the exercise period provided for in Section 3 or 4, as applicable, the Option will remain fully exercisable for the period set forth in the applicable Section 3 or 4, and the person entitled by will or the applicable laws of descent and distribution to exercise the Option on behalf of the Participant may exercise the Option during such applicable period or until the expiration of the stated term of the Option, whichever period is shorter.
Section 6. Accelerated Vesting in Connection With a Change in Control.
(a) | Upon a Change in Control occurring during the Vesting Period, if the Participant has been continuously employed by either the Company or any Subsidiary between the Date of Grant and the date of such Change in Control, to the extent that the Option has not previously been forfeited, the Option will fully vest and become fully exercisable, except to the extent that a Replacement Award is provided to the Participant to replace, continue or adjust the outstanding Option (the Replaced Award). If the Participant is provided with a Replacement Award in connection with the Change in Control, then if, upon or after receiving the Replacement Award, the Participants employment with the Company or any Subsidiary (or any of their successors after the Change in Control) (as applicable, the Successor) is terminated by the Participant for Good Reason or by the Successor other than for Cause (excluding, for the avoidance of doubt, termination due to the Participants death, Disability, retirement or voluntary resignation), in each case within a period of two years after the Change in Control and during the Vesting Period, to the extent that the Replacement Award has not previously been forfeited, (i) the Replacement Award will become fully vested |
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and immediately exercisable in full, and (ii) the Replacement Award will remain exercisable for a period of 90 days following such termination or until the expiration of the stated term of such Replacement Award, whichever period is shorter. |
(b) | For purposes of this Agreement, a Replacement Award means an award (i) of the same type (i.e., stock options) as the Replaced Award, (ii) that has a value at least equal to the value of the Replaced Award, (iii) that relates to publicly traded equity securities of the Successor in the Change in Control (or another entity that is affiliated with the Successor following the Change in Control), (iv) the tax consequences of which for such Participant under the Code, if the Participant is subject to U.S. federal income tax under the Code, are not less favorable to the Participant than the tax consequences of the Replaced Award, and (v) the other terms and conditions of which are not less favorable to the Participant than the terms and conditions of the Replaced Award (including the provisions that would apply in the event of a subsequent change in control). A Replacement Award may be granted only to the extent it does not result in the Replaced Award or Replacement Award failing to comply with or ceasing to be exempt from Section 409A of the Code, if applicable. Without limiting the generality of the foregoing, the Replacement Award may take the form of a continuation of the Replaced Award if the requirements of the preceding two sentences are satisfied. The determination of whether the conditions of this Section 2(b) are satisfied will be made in good faith by the Committee, as constituted immediately before the Change in Control, in its sole discretion. |
(c) | For purposes of this Agreement, Cause has the meaning set forth in the Participants employment, change in control, or severance agreement, as applicable (in that order), or otherwise means: (i) the Participants gross negligence or serious misconduct (including, without limitation, any criminal, fraudulent or dishonest conduct) that is or may be injurious to the Successor; or (ii) the Participant being convicted of, or entering a plea of nolo contendere to, any crime that constitutes a felony or involves moral turpitude; or (iii) the Participants breach of a written agreement between the Participant and the Successor; or (iv) the Participants willful and continued failure to perform the Participants duties on behalf of the Successor; or (v) the Participants material breach of a written policy of the Successor. |
(d) | For purposes of this Agreement, Good Reason means: (i) a material change in the geographic location at which the Participant must perform the Participants services (which shall in no event include a relocation of the Participants current principal place of business to a location less than 50 miles away) from the geographic location immediately prior to the Change of Control; (ii) a material diminution in the Participants base compensation from the level immediately prior to the Change of Control; or (iii) a material diminution in the Participants authority, duties, or responsibilities from the level immediately prior to the Change of Control; provided, however, that no termination shall be deemed to be for Good Reason unless (x) the Participant provides the Successor with written |
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notice setting forth the specific facts or circumstances constituting Good Reason within ninety (90) days after the initial existence of the occurrence of such facts or circumstances, (y) the Successor has failed to cure such facts or circumstances within thirty (30) days of its receipt of such written notice, and (z) the effective date of the termination for Good Reason occurs no later than one hundred fifty (150) days after the initial existence of the facts or circumstances constituting Good Reason. |
Section 7. Exercisability and Forfeiture Upon Other Terminations of Employment. If the Participant ceases to be employed by the Company or any Subsidiary for any reason other than those described in Sections 2, 3, 4 and 6 above, to the extent that the Option has not previously been forfeited, the Option will cease vesting, but the Participant may exercise the Option (to the same extent the Participant was entitled to exercise the Option immediately prior to such termination of employment) for a period of 90 days following the date of such termination of employment or until the expiration of the stated term of the Option, whichever period is shorter.
Section 8. Term of the Option. Notwithstanding any other provisions of this Agreement, the Option will not be exercisable after , 20 , which date is one day immediately prior to the tenth annual anniversary of the Date of Grant.
Section 9. Forfeiture upon Termination due to Violation of the Code of Conduct and Ethics. Notwithstanding any other provisions of this Agreement, if the Participants employment with the Company or any Subsidiary is terminated on account of a violation of the Companys Code of Conduct and Ethics, the Option will be forfeited upon such termination to the full extent not previously exercised at the time of such termination. In addition, the Participant acknowledges and agrees that the terms and conditions set forth in any clawback or recoupment policy adopted by the Board and in effect from time to time apply to the Option. To the extent such policy is applicable to the Participant, it creates additional rights for the Company with respect to the Option.
Section 10. Transferability. Subject to Section 15 of the Plan, the Option is not transferable by the Participant other than by will, by the laws of descent and distribution, or in accordance with a domestic relations order or comparable order that is issued and is applicable to the Participant, and the Option is exercisable, during the lifetime of the Participant, only by the Participant or the Participants guardian or legal representative. Upon any attempt to transfer, assign, pledge, hypothecate, or otherwise dispose of the Option or any related rights to the Option that is contrary to the provisions of this Agreement or the Plan, or upon the levy of any attachment or similar process upon the Option or such rights, the Option and such rights shall immediately become null and void.
Section 11. Prevented Exercise. Subject in all cases to the expiration of the stated term of the Option, if the Participants exercise of this option is prevented under the terms of subsections (a), (b) or (c) of Section 15 and the Option terminates prior to the stated term of the Option pursuant to Section 4 or 5, then the Participant may, notwithstanding the provisions of Section 4 or 5, exercise the Option to the extent it would have been exercisable immediately prior to its termination but for the operation of Section 15 at any time within 30 days after such Participant is notified by the Company that such exercise is no longer prevented under Section 15.
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Section 12. Adjustments. The Committee shall make or provide for such adjustments in the number of shares of Common Stock covered by the Option, in the Option Exercise Price, and in the kind of shares covered by the Option as the Committee, in its sole discretion, exercised in good faith, may determine is equitably required to prevent dilution or enlargement of the rights of the Participant that otherwise would result from (a) any stock dividend, stock split, combination of shares, recapitalization or other change in the capital structure of the Company, (b) any merger, consolidation, spin-off, split-off, spin-out, split-up, reorganization, partial or complete liquidation or other distribution of assets, issuance of rights or warrants to purchase securities, or (c) any other corporate transaction or event having an effect similar to any of the foregoing. Moreover, in the event of any such transaction or event or in the event of a Change in Control, the Committee, in its discretion, shall provide in substitution for the Option such alternative consideration (including cash), if any, as it, in good faith, may determine to be equitably required in the circumstances and may require in connection therewith the surrender of the Option in a manner that complies with Section 409A of the Code. In addition, if the Option Exercise Price is greater than the consideration offered in connection with any such transaction or event or Change in Control, the Committee may in its sole discretion elect to cancel the Option without any payment to the Participant. Notwithstanding anything to the contrary contained in this Agreement, the Participant will not be entitled to purchase a fraction of a share under the Option.
Section 13. Manner of Exercise. Subject to the terms and conditions of this Agreement, the Option shall be exercised in whole or in part by delivering to the Company at its principal place of business a written notice, signed by the person entitled to exercise the Option, of the election to exercise the Option and stating the number of shares to be purchased. Such notice shall, as an essential part, be accompanied by the payment of the full Option Exercise Price of the shares then to be purchased, except as provided below. To the extent permitted by applicable law, payment of the full Option Exercise Price shall be made, at the election of the Participant, in (a) cash or by check acceptable to the Company or by wire transfer of immediately available funds, (b) by the actual or constructive transfer to the Company of Common Stock owned by the Participant having a value at the time of exercise equal to the full Option Exercise Price, (c) the Companys withholding of Common Stock otherwise issuable upon exercise of the Option pursuant to a net exercise arrangement, (d) by a combination of such methods of payment, or (e) by such other methods as may be approved by the Committee. To the extent permitted by applicable law, the Participant may elect to pay the Option Exercise Price upon the exercise of the Option by authorizing a third party to sell all the shares (or a sufficient portion of the shares) acquired upon the exercise of the Option and to remit to the Company a sufficient portion of the sale proceeds to pay the entire Option Exercise Price and any tax withholding resulting from such exercise. The Participant agrees that as holder of this option, the Participant shall have no rights as a stockholder or otherwise in respect of any of the shares underlying the Option until the Option is effectively exercised as provided in this Agreement.
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Subject to Section 16 of the Plan, to the extent that the Company is required to withhold federal, state, local or foreign taxes in connection with any payment made or benefit realized by the Participant or other person under the Option, and the amounts available to the Company for such withholding are insufficient, it will be a condition to the receipt of such payment or the realization of such benefit that the Participant or such other person make arrangements satisfactory to the Company for payment of the balance of such taxes required to be withheld, which arrangements (in the discretion of the Committee) may include relinquishment of a portion of such benefit. If the Participant fails to make arrangements for the payment of such tax, then, unless otherwise determined by the Committee, the Company will withhold shares of Common Stock having a value equal to the amount required to be withheld from the Option exercise. Notwithstanding the foregoing, the Participant may elect, unless otherwise determined by the Committee, to satisfy the obligation, in whole or in part, by having withheld, from the shares required to be delivered to the Participant, shares of Common Stock having a value equal to the amount required to be withheld, or by delivering to the Company other shares of Common Stock held by the Participant. The shares used for tax withholding will be valued at an amount equal to the market value of such Common Stock on the date the benefit is to be included in Participants income. In no event will the market value of the Common Stock to be withheld and delivered pursuant to this Section 13 to satisfy applicable withholding taxes in connection with the benefit exceed the minimum amount of taxes required to be withheld.
Section 14. No Dividend Equivalents. The Participant shall not be entitled to dividend equivalents with respect to the Option or the shares underlying the Option.
Section 15. Compliance with Laws. This option shall not be exercisable if such exercise would violate:
(a) | Any applicable state or non-U.S. securities law; |
(b) | Any applicable registration or other requirements under the Securities Act of 1933, as amended (the Act), the Exchange Act, or applicable listing requirements of any stock exchange; or |
(c) | Any applicable legal requirement of any other governmental authority. |
The Company agrees to make reasonable efforts to comply with the foregoing laws and requirements so as to permit the exercise of the Option. Furthermore, if a registration statement with respect to the shares to be issued upon the exercise of the Option is not in effect or if counsel for the Company deems it necessary or desirable in order to avoid possible violation of the Act, the Company may require, as a condition to its issuance and delivery of certificates for, or providing for book entry of, the shares, the delivery to the Company of a commitment in writing by the person exercising the Option that at the time of such exercise it is such persons intention to acquire such shares for such persons own account for investment only and not with a view to, or for resale in connection with, the distribution thereof; that such person understands the shares may be restricted securities as defined in Rule 144 under the Act; and that any resale, transfer or other disposition of said shares will be accomplished only in compliance with Rule 144, the Act, and any other applicable rules and regulations under the Act. The Company may place on the certificates evidencing such shares, or in book entry for such shares, an appropriate legend reflecting such commitment and the Company may refuse to permit transfer of such certificates or the shares until it has been furnished evidence satisfactory to it that no violation of the Act or the rules and regulations under the Act would be involved in such transfer.
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Section 16. Relationship to the Plan. This Agreement is subject to the terms of the Plan and any related administrative policies or procedures adopted by the Company. If there is any inconsistency between this Agreement and the Plan or any such administrative policies or procedures, the Plan and the policies or procedures, in that order, shall govern. Nothing in this Agreement shall interfere with or affect the rights of the Company or the Participant under any employment agreement or confer upon the Participant any right to continued employment with the Company or any Subsidiary.
Section 17. Compliance with Section 409A of the Code. To the extent applicable, it is intended that this Agreement comply with the provisions of Section 409A of the Code, so that the income inclusion provisions of Section 409A(a)(1) of the Code do not apply to the Participant. This Agreement shall be administered in a manner consistent with this intent. Reference to Section 409A of the Code is to Section 409A of the Internal Revenue Code of 1986, as amended, and will also include any regulations or any other formal guidance promulgated with respect to such Section by the U.S. Department of the Treasury or the Internal Revenue Service.
Section 18. Amendments. Any amendment to the Plan shall be deemed to be an amendment to this Agreement to the extent that the amendment is applicable hereto; provided, however, that no amendment shall adversely affect the rights of the Participant under this Agreement without the Participants consent (provided, however, that the Participants consent shall not be required to an amendment that is deemed necessary by the Company to ensure compliance with Section 409A of the Code). No amendment, modification, waiver or release of or under this Agreement will be effective unless evidenced by an instrument in writing signed by each of the Company and the Participant.
Section 19. Severability. If any provision of this Agreement or the application of any provision hereof to any person or circumstances is held invalid, unenforceable or otherwise illegal, the remainder of this Agreement and the application of such provision to any other person or circumstances shall not be affected, and the provisions so held to be invalid, unenforceable or otherwise illegal shall be reformed to the extent (and only to the extent) necessary to make it enforceable, valid and legal.
Section 20. Binding Effect. Subject to the provisions of the Plan, this Agreement shall inure to the benefit of and be binding upon the Participant and the Company and their respective heirs, legal representatives, successors and assigns.
Section 21. Electronic Delivery. The Company may, in its sole discretion, deliver any documents related to the Option and the Participants participation in the Plan, or future awards that may be granted under the Plan, by electronic means or to request the Participants consent to participate in the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and, if requested, agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.
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Section 22. Nature of Grant. The Participant acknowledges and agrees that: (a) the Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time; (b) the grant of the Option is voluntary and occasional and does not create any contractual or other right to receive future grants of Option Rights or benefits in lieu of Option Rights, even if Option Rights have been granted repeatedly in the past; (c) all decisions with respect to future Option Rights grants, if any, will be at the sole discretion of the Company; (d) participation in the Plan is voluntary; (e) the Option is not a part of normal or expected compensation or salary for any purposes, including, but not limited to, calculating any severance, resignation, termination, redundancy, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments; (f) the future value of the underlying shares of Common Stock is unknown and cannot be predicted with certainty; and (g) in consideration of the grant of the Option, no claim or entitlement to compensation or damages shall arise from termination of the Option or diminution in value of the Option including (without limitation) any claim or entitlement resulting from termination of the Participants employment with the Company or a Subsidiary or affiliate (for any reason whatsoever and whether or not in breach of local labor laws) and the Participant hereby releases the Company and its Subsidiaries and affiliates from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by signing this Agreement, the Participant shall be deemed irrevocably to have waived the Participants entitlement to pursue such claim.
Section 23. Data Privacy. The Participant explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of the Participants personal data by and among, as applicable, the Company and its Subsidiaries and affiliates, namely OM Group, Inc. (located in the United States of America), and the entities listed on Annex A (located in the countries designated on Annex A) for the exclusive purpose of implementing, administering and managing the Participants participation in the Plan. The Participant hereby understands that the Company and its Subsidiaries and affiliates hold (but only process or transfer to the extent required or permitted by local law) the following personal information about the Participant: the Participants name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of Common Stock or directorships held in the Company, details of all Option Rights or any other entitlement to shares of Common Stock awarded, canceled, exercised, vested, unvested or outstanding in the Participants favor, for the purpose of implementing, administering and managing the Plan (Data). The Participant hereby understands that Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, including the entities listed on Annex B (located in the countries designated on Annex B) that these recipients may be located in the Participants country or elsewhere (including countries outside of the European Economic Area such as the United States of America), and that the recipients country may have different data privacy laws and protections than the Participants country. The Participant hereby understands that the Participant may request a list with the names and addresses of any potential recipients of the Data by contacting the Participants local human resources representative. The Participant authorizes the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing the Participants participation in the Plan, including any requisite transfer of such Data as may be required to a broker or other third party with whom the Participant may elect to deposit any shares acquired upon exercise of the Option. The Participant hereby understands that Data will be held only as long as is necessary to implement, administer and manage the Participants participation in the Plan and in accordance with local law. The
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Participant hereby understands that the Participant may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing the Participants local human resources representative. The Participant hereby understands, however, that refusing or withdrawing the Participants consent may affect the Participants ability to participate in the Plan. For more information on the consequences of the Participants refusal to consent or withdrawal of consent, the Participant hereby understands that the Participant may contact the Participants local human resources representative.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.
PARTICIPANT | OM GROUP, INC. | |||||||
By: |
|
By: |
| |||||
[NAME] | [NAME] | |||||||
Title: | [TITLE] |
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Annex A
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Annex B
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Exhibit 10.2
Form of International Performance-Based RSU Agreement (2014 Plan)
OM GROUP, INC.
PERFORMANCE-BASED RESTRICTED STOCK UNITS AGREEMENT
THIS PERFORMANCE-BASED RESTRICTED STOCK UNITS AGREEMENT (the Agreement), dated as of , 201 , is by and between OM GROUP, INC. (the Company) and (the Participant). All terms used in this Agreement with initial capital letters and not otherwise defined in this Agreement that are defined in the Companys 2014 Equity and Incentive Compensation Plan (the Plan) shall have the meanings assigned to them in the Plan.
WHEREAS, the Company maintains the Plan for the purpose of attracting and retaining non-employee Directors, officers and other key executives and employee of the Company and its Subsidiaries and to provide to such persons incentives and rewards for performance;
WHEREAS, pursuant to the Plan, and subject to the terms and conditions thereof and the terms and conditions hereinafter set forth, this Agreement evidences and memorializes the Companys grant to the Participant, effective as of , 201 (the Date of Grant) of performance-based Restricted Stock Units (the PRSUs). Subject to the achievement of the Management Objectives described in Section 3 of this Agreement, the Participant may earn between 0% and % of the PRSUs.
NOW, THEREFORE, the Company and the Participant agree as follows:
1. Earning of PRSUs. If the PRSUs under this Agreement become nonforfeitable and payable (Vest or similar terms) in accordance with Section 3 of this Agreement, the Participant will be entitled to settlement of the Vested PRSUs as specified in Section 4 of this Agreement.
2. Transferability of PRSUs. Subject to Section 15 of the Plan, the rights of the Participant under this Agreement, the PRSUs (prior to settlement) and any interest therein or in any Common Stock underlying such PRSUs shall not be transferable other than by will or by the laws of descent and distribution. Upon any attempt to transfer, assign, pledge, hypothecate, or otherwise dispose of the PRSUs or any related rights to the PRSUs that is contrary to the provisions of this Agreement or the Plan, or upon the levy of any attachment or similar process upon the PRSUs or such rights, the PRSUs and such rights shall immediately become null and void.
3. Vesting of PRSUs.
3.1 Normal Vesting. Subject to Sections 3.2 through 3.5 of this Agreement, the PRSUs will Vest (and become entitled to settlement as specified in Section 4 of this Agreement) based on the relative achievement of the Management Objective(s) approved by the Committee on the Date of Grant (the Performance Targets) for the performance period from January 1, 20 through December 31, 20 (the Performance Period) as follows:
(a) The applicable percentage of the PRSUs that shall be earned by the Participant for the Performance Period shall be determined by reference to the Performance Matrix for the Performance Period approved by the Committee on the Date of Grant and communicated to the Participant in writing (the Performance Matrix) if the Participant remains continuously employed by either the Company or any Subsidiary until the end of the Performance Period. For purposes of this Agreement, the continuous employment of the Participant with the Company or any Subsidiary will not be deemed to have been interrupted, and the Participant shall not be deemed to have ceased to be an employee of the Company or any Subsidiary, by reason of the transfer of the Participants employment among the Company and its Subsidiaries;
(b) In the event that achievement with respect to one of the Performance Targets is between the performance levels specified in the Performance Matrix, the applicable percentage of the PRSUs that shall be earned by the Participant for the Performance Period for that particular Performance Target shall be determined by the Committee using straight-line mathematical interpolation; and
(c) To the extent the Performance Targets are not achieved by the end of the Performance Period, then the PRSUs evidenced by this Agreement will be forfeited without compensation or other consideration. The Vesting of the PRSUs pursuant to this Section 3.1 shall be contingent upon a determination of the Committee that the Performance Metrics have been satisfied.
3.2 Pro-Rata Vesting Due to Death or Becoming Disabled. If, prior to the end of the Performance Period, the Participant dies or becomes Disabled while in the employ of the Company or any Subsidiary, then, to the extent that the PRSUs have not previously been forfeited, a pro-rata number of the PRSUs shall remain eligible for Vesting after the end of the Performance Period (and become entitled to settlement as specified in Section 4 of this Agreement), with such pro-rata number of PRSUs being determined by multiplying (a) the number of PRSUs in which the Participant would have Vested in accordance with the terms and conditions of Section 3.1 if the Participant had remained in the continuous employment of the Company or any Subsidiary from the Date of Grant until the end of the Performance Period (or the occurrence of a Change in Control to the extent a Replacement Award is not provided) by (b) a fraction (i) the numerator of which is the total number of calendar days in the period commencing with the start of the Performance Period and ending on the date of such death or the date on which the Participant became Disabled and (ii) the denominator of which is the number of days in the Performance Period, with any fractional share rounded down to the nearest whole number. The balance of the PRSUs evidenced by this Agreement and not subject to pro-rata eligibility for Vesting under this Section 3.2 shall be immediately forfeited without
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compensation or other consideration. For purposes of this Agreement, the Participant shall be considered to have become Disabled if the Participant has qualified for a long-term disability benefit under a disability plan or program of the Company or, in the absence of a disability plan or program of the Company, under a government-sponsored disability program, and is disabled within the meaning of Section 409A(a)(2)(C) of the Code.
3.3 Pro-Rata Vesting Due to Retirement. If the Participant ceases to be employed by the Company or any Subsidiary prior to the end of the Performance Period due to the Participants retirement in accordance with any retirement plan or policy of the Company or any Subsidiary (Retirement), then, to the extent that the PRSUs have not previously been forfeited, a pro-rata number of the PRSUs shall remain eligible for Vesting after the end of the Performance Period (and become entitled to settlement as specified in Section 4 of this Agreement), with such pro-rata number of PRSUs being determined by multiplying (a) the number of PRSUs in which the Participant would have Vested in accordance with the terms and conditions of Section 3.1 if the Participant had remained in the continuous employment of the Company or any Subsidiary from the Date of Grant until the end of the Performance Period (or the occurrence of a Change in Control to the extent a Replacement Award is not provided) by (b) a fraction (i) the numerator of which is the total number of calendar days in the period commencing with the start of the Performance Period and ending on the date of such Retirement and (ii) the denominator of which is the number of days in the Performance Period, with any fractional share rounded down to the nearest whole number. The balance of the PRSUs evidenced by this Agreement and not subject to pro-rata eligibility for Vesting under this Section 3.3 shall be immediately forfeited without compensation or other consideration.
3.4 Accelerated Vesting in Connection with a Change in Control.
(a) Upon a Change in Control occurring after the Date of Grant but prior to the end of the Performance Period, if the Participant has been continuously employed by either the Company or any Subsidiary between the Date of Grant and the date of such Change in Control, to the extent that the PRSUs have not previously been forfeited, the PRSUs shall Vest in full at the target level (and become entitled to settlement as specified in Section 4 of this Agreement), except to the extent that a Replacement Award is provided to the Participant to replace, continue or adjust the outstanding PRSUs (the Replaced Award). If the Participant is provided with a Replacement Award in connection with the Change in Control, then if, upon or after receiving the Replacement Award, the Participants employment with the Company or any Subsidiary (or any of their successors after the Change in Control) (as applicable, the Successor) is terminated by the Participant for Good Reason or by the Successor other than for Cause (excluding, for the avoidance of doubt, termination due to the Participants death, Disability, retirement or voluntary resignation), in each case within a period of two years after the Change in Control but prior to the end of the Performance Period, to the extent that the Replacement
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Award has not previously been forfeited, (i) the Replacement Award will Vest in full at the target level (and become entitled to settlement as specified in Section 4 of this Agreement).
(b) For purposes of this Agreement, a Replacement Award means an award (i) of the same type (i.e., performance-based restricted stock units) as the Replaced Award, (ii) that has a value at least equal to the value of the Replaced Award, (iii) that relates to publicly traded equity securities of the Successor in the Change in Control (or another entity that is affiliated with the Successor following the Change in Control), (iv) the tax consequences of which for such Participant under the Code, if the Participant is subject to U.S. federal income tax under the Code, are not less favorable to the Participant than the tax consequences of the Replaced Award, and (v) the other terms and conditions of which are not less favorable to the Participant than the terms and conditions of the Replaced Award (including the provisions that would apply in the event of a subsequent change in control). A Replacement Award may be granted only to the extent it does not result in the Replaced Award or Replacement Award failing to comply with or ceasing to be exempt from Section 409A of the Code, if applicable. Without limiting the generality of the foregoing, the Replacement Award may take the form of a continuation of the Replaced Award if the requirements of the preceding two sentences are satisfied. The determination of whether the conditions of this Section 3.4(b) are satisfied will be made in good faith by the Committee, as constituted immediately before the Change in Control, in its sole discretion.
(c) For purposes of this Agreement, Cause has the meaning set forth in the Participants employment, change in control, or severance agreement, as applicable (in that order), or otherwise means: (i) the Participants gross negligence or serious misconduct (including, without limitation, any criminal, fraudulent or dishonest conduct) that is or may be injurious to the Successor; or (ii) the Participant being convicted of, or entering a plea of nolo contendere to, any crime that constitutes a felony or involves moral turpitude; or (iii) the Participants breach of a written agreement between the Participant and the Successor; or (iv) the Participants willful and continued failure to perform the Participants duties on behalf of the Successor; or (v) the Participants material breach of a written policy of the Successor.
(d) For purposes of this Agreement, Good Reason means: (i) a material change in the geographic location at which the Participant must perform the Participants services (which shall in no event include a relocation of the Participants current principal place of business to a location less than 50 miles away) from the geographic location immediately prior to the Change of Control; (ii) a material diminution in the Participants base compensation from the level immediately prior to the Change of Control; or (iii) a material diminution in the Participants authority, duties, or responsibilities from the level immediately prior
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to the Change of Control; provided, however, that no termination shall be deemed to be for Good Reason unless (x) the Participant provides the Successor with written notice setting forth the specific facts or circumstances constituting Good Reason within ninety (90) days after the initial existence of the occurrence of such facts or circumstances, (y) the Successor has failed to cure such facts or circumstances within thirty (30) days of its receipt of such written notice, and (z) the effective date of the termination for Good Reason occurs no later than one hundred fifty (150) days after the initial existence of the facts or circumstances constituting Good Reason.
(e) If a Replacement Award is provided, notwithstanding anything in this Agreement or the Plan to the contrary, any outstanding PRSUs that at the time of the Change in Control are not subject to a substantial risk of forfeiture (within the meaning of Section 409A of the Code) will be deemed to be Vested at the time of such Change in Control and will be settled as provided for in Section 4 of this Agreement.
3.5 Forfeiture Upon Other Terminations of Employment. Any PRSUs that have not Vested pursuant to Section 3 of this Agreement on or prior to the end of the Performance Period will be forfeited automatically and without further notice on such date without compensation or any other consideration (or earlier if, and on such date that, the Participant ceases to be an employee of the Company or any Subsidiary prior to the end of the Performance Period for any reason other than as described in Sections 3.2 through 3.4 of this Agreement). For purposes of this Section 3, the Participant shall have ceased to be employed by the Company or any Subsidiary when the Participant no longer has the right or obligation to perform services in such capacity, notwithstanding the continuation of any employment agreement for any other purpose or the continuation of compensation or benefits under any such employment agreement or otherwise.
4. Form and Time of Settlement of PRSUs.
4.1 General. Subject to Sections 3.5 and 4.2 of this Agreement, settlement of the RSUs that have become Vested in accordance with Section 3 of this Agreement shall be made in the form of a single lump sum cash amount equal to the Market Value per Share of one share of Common Stock for each Vested PRSU, which amount will be paid in the calendar year immediately following the calendar year in which the Performance Period ends.
4.2 Other Settlement Events. Notwithstanding Section 4.1 of this Agreement, to the extent that the PRSUs are Vested on the dates set forth below, settlement with respect to the PRSUs will be made as follows:
(a) Change in Control. Upon a Change in Control, the Participant is entitled to receive payment for Vested PRSUs in the form of a single lump sum cash amount equal to the Market Value per Share of one share of Common Stock for each Vested PRSU on the date of the Change in Control; provided, however,
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that if such Change in Control would not qualify as a permissible date of distribution under Section 409A(a)(2)(A) of the Code, and the regulations thereunder, and where Section 409A of the Code applies to such distribution, the Participant is entitled to receive the corresponding payment on the date that would have otherwise applied pursuant to Sections 4.1 or 4.2(b) of this Agreement as though such Change in Control had not occurred.
(b) Death or Disability. On the date of the Participants death or the date the Participant becomes Disabled, the Participant is entitled to receive payment for Vested PRSUs in the form of a single lump sum cash amount equal to the Market Value per Share of one share of Common Stock for each Vested PRSU on such date.
5. Payment of Dividend Equivalents. From and after the Date of Grant and until the earlier of (a) the time when the PRSUs become Vested and are settled in accordance with Sections 3 and 4 of this Agreement or (b) the time when the Participants right to receive payment in settlement of the PRSUs is forfeited in accordance with Section 3 of this Agreement, on the date that the Company pays a cash dividend (if any) to holders of Common Stock generally, the Participant shall be entitled to a number of additional PRSUs determined by dividing (x) the product of (i) the dollar amount of the cash dividend paid per share of Common Stock on such date and (ii) the Participants maximum number of PRSUs (including dividend equivalents credited thereon) as of such date, by (y) the Market Value per Share of the Common Stock on such date. Such dividend equivalents (if any) shall be subject to the same terms and conditions and shall be paid, in the aggregate rounded down to the nearest whole number, or forfeited in the same manner and at the same time as the PRSUs to which the dividend equivalents were credited.
6. Tax Withholding. Subject to Section 16 of the Plan, to the extent that the Company is required to withhold federal, state, local or foreign taxes in connection with any payment made or benefit realized by the Participant or other person under the PRSUs, and the amounts available to the Company for such withholding are insufficient, it will be a condition to the receipt of such payment or the realization of such benefit that the Participant or such other person make arrangements satisfactory to the Company for payment of the balance of such taxes required to be withheld, which arrangements (in the discretion of the Committee) may include relinquishment of a portion of such benefit.
7. Adjustments. The Committee shall make or provide for such adjustments in the number of shares of Common Stock covered by the PRSUs and in the kind of shares covered by the PRSUs as the Committee, in its sole discretion, exercised in good faith, may determine is equitably required to prevent dilution or enlargement of the rights of the Participant that otherwise would result from (a) any stock dividend, stock split, combination of shares, recapitalization or other change in the capital structure of the Company, (b) any merger, consolidation, spin-off, split-off, spin-out, split-up, reorganization, partial or complete liquidation or other distribution of assets, issuance of rights or warrants to purchase securities, or (c) any other corporate transaction or event having an effect similar to any of the foregoing.
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Moreover, in the event of any such transaction or event or in the event of a Change in Control, the Committee, in its discretion, shall provide in substitution for the PRSUs such alternative consideration (including cash), if any, as it, in good faith, may determine to be equitable in the circumstances and may require in connection therewith the surrender of the PRSUs in a manner that complies with Section 409A of the Code. Any action taken by the Committee pursuant to this Section 7 will only be taken to the extent it does not result in the PRSUs failing to comply with or ceasing to be exempt from Section 409A of the Code.
8. Special Incentive Compensation. The Participant agrees that the award of the PRSUs is special incentive compensation and that it, any dividend equivalents paid thereon (even if treated as compensation for tax purposes) and any other property received on account of such PRSUs will not be taken into account as salary or compensation or bonus in determining the amount of any payment under any pension, retirement or profit-sharing plan of the Company or any life insurance, disability or other benefit plan of the Company.
9. Relationship to the Plan. This Agreement is subject to the terms of the Plan and any related administrative policies or procedures adopted by the Company. If there is any inconsistency between this Agreement and the Plan or any such administrative policies or procedures, the Plan and the policies or procedures, in that order, shall govern (except that, with respect to Sections 3.4 and 4 of this Agreement, the terms of this Agreement shall govern in the case of an inconsistency between Sections 3.4 or 4 of this Agreement and the Plan).
10. No Effect on Employment Relationship. This Agreement is not intended to have any effect upon the Participants employment relationship with the Company or any Subsidiary. Nothing in this Agreement shall interfere with or affect the rights of the Company or the Participant under any employment agreement or confer upon the Participant any right to continued employment with the Company or any Subsidiary.
11. Forfeiture upon Termination due to Violation of the Code of Conduct and Ethics. Notwithstanding any other provisions of this Agreement, if the Participants employment with the Company or any Subsidiary is terminated on account of a violation of the Companys Code of Conduct and Ethics, the PRSUs will be forfeited upon such termination.
12. Binding Effect. Subject to the provisions of the Plan, this Agreement shall inure to the benefit of and be binding upon the Participant and the Company and their respective heirs, legal representatives, successors and assigns.
13. Amendments. Any amendment to the Plan shall be deemed to be an amendment to this Agreement to the extent that the amendment is applicable hereto; provided, however, that no amendment shall adversely affect the rights of the Participant under this Agreement without the Participants consent (provided, however, that the Participants consent shall not be required to an amendment that is deemed necessary by the Company to ensure compliance with Section 409A of the Code). No amendment, modification, waiver or release of or under this Agreement will be effective unless evidenced by an instrument in writing signed by each of the Company and the Participant.
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14. Compliance with Law. The Company shall make reasonable efforts to comply with all applicable federal, state and non-U.S. securities laws.
15. Compliance with Section 409A of the Code. To the extent applicable, it is intended that this Agreement and the Plan comply with the provisions of Section 409A of the Code, so that the income inclusion provisions of Section 409A(a)(1) of the Code do not apply to the Participant. This Agreement and the Plan shall be interpreted in a manner consistent with this intent. Reference to Section 409A of the Code is to Section 409A of the Internal Revenue Code of 1986, as amended, and will also include any proposed, temporary or final regulations, or any other guidance promulgated with respect to such Section by the U.S. Department of the Treasury or the Internal Revenue Service.
16. Severability. If any provision of this Agreement or the application of any provision hereof to any person or circumstances is held invalid, unenforceable or otherwise illegal, the remainder of this Agreement and the application of such provision to any other person or circumstances shall not be affected, and the provisions so held to be invalid, unenforceable or otherwise illegal shall be reformed to the extent (and only to the extent) necessary to make it enforceable, valid and legal.
17. Electronic Delivery. The Company may, in its sole discretion, deliver any documents related to the PRSUs and the Participants participation in the Plan, or future awards that may be granted under the Plan, by electronic means or to request the Participants consent to participate in the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and, if requested, agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.
18. Nature of Grant. The Participant acknowledges and agrees that: (a) the Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time; (b) the grant of PRSUs is voluntary and occasional and does not create any contractual or other right to receive future grants of PRSUs, or benefits in lieu of PRSUs, even if PRSUs have been granted repeatedly in the past; (c) all decisions with respect to future PRSU grants, if any, will be at the sole discretion of the Company; (d) participation in the Plan is voluntary; (e) the PRSUs are not a part of normal or expected compensation or salary for any purposes, including, but not limited to, calculating any severance, resignation, termination, redundancy, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments; (f) the future value of the underlying shares of Common Stock is unknown and cannot be predicted with certainty; and (g) in consideration of the grant of PRSUs, no claim or entitlement to compensation or damages shall arise from termination of the PRSUs or diminution in value of the PRSUs including (without limitation) any claim or entitlement resulting from termination of the Participants employment with the Company or any Subsidiary or affiliate (for any reason whatsoever and whether or not in breach of local labor laws) and the Participant hereby releases the Company and its Subsidiaries and affiliates from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by signing this Agreement, the Participant shall be deemed irrevocably to have waived the Participants entitlement to pursue such claim.
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19. Data Privacy. The Participant explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of the Participants personal data by and among, as applicable, the Company and its Subsidiaries and affiliates, namely OM Group, Inc. (located in the United States of America), and the entities listed on Annex A (located in the countries designated on Annex A) for the exclusive purpose of implementing, administering and managing the Participants participation in the Plan. The Participant hereby understands that the Company and its Subsidiaries and affiliates hold (but only process or transfer to the extent required or permitted by local law) the following personal information about the Participant: the Participants name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of Common Stock or directorships held in the Company, details of all PRSUs or any entitlement to shares of Common Stock awarded, canceled, exercised, vested, unvested or outstanding in the Participants favor, for the purpose of implementing, administering and managing the Plan (Data). The Participant hereby understands that Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, including the entities listed on Annex B (located in the countries designated on Annex B) that these recipients may be located in the Participants country or elsewhere (including countries outside of the European Economic Area such as the United States of America), and that the recipients country may have different data privacy laws and protections than the Participants country. The Participant hereby understands that the Participant may request a list with the names and addresses of any potential recipients of the Data by contacting the Participants local human resources representative. The Participant authorizes the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing the Participants participation in the Plan, including any requisite transfer of such Data as may be required to a broker or other third party with whom the Participant may elect to deposit any shares acquired upon vesting of the PRSUs. The Participant hereby understands that Data will be held only as long as is necessary to implement, administer and manage the Participants participation in the Plan and in accordance with local law. The Participant hereby understands that the Participant may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing the Participants local human resources representative. The Participant hereby understands, however, that refusing or withdrawing the Participants consent may affect the Participants ability to participate in the Plan. For more information on the consequences of the Participants refusal to consent or withdrawal of consent, the Participant hereby understands that the Participant may contact the Participants local human resources representative.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.
PARTICIPANT | OM GROUP, INC. | |||||||
By: |
|
By: |
| |||||
[NAME] | [NAME] | |||||||
Title: | [TITLE] |
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Annex A
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Annex B
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Exhibit 10.3
Form of International Time-Based RSU Agreement (2014 Plan)
OM GROUP, INC.
TIME-BASED RESTRICTED STOCK UNITS AGREEMENT
THIS TIME-BASED RESTRICTED STOCK UNITS AGREEMENT (the Agreement), dated as of , 201 , is by and between OM GROUP, INC. (the Company) and (the Participant). All terms used in this Agreement with initial capital letters and not otherwise defined in this Agreement that are defined in the Companys 2014 Equity and Incentive Compensation Plan (the Plan) shall have the meanings assigned to them in the Plan.
WHEREAS, the Company maintains the Plan for the purpose of attracting and retaining non-employee Directors, officers and other key executives and employee of the Company and its Subsidiaries and to provide to such persons incentives and rewards for performance;
WHEREAS, pursuant to the Plan, and subject to the terms and conditions thereof and the terms and conditions hereinafter set forth, this Agreement evidences and memorializes the Companys grant to the Participant, effective as of , 201 (the Date of Grant) of Restricted Stock Units (the RSUs).
NOW, THEREFORE, the Company and the Participant agree as follows:
1. Earning of RSUs. If the RSUs under this Agreement become nonforfeitable and payable (Vest or similar terms) in accordance with Section 3 of this Agreement, the Participant will be entitled to settlement of the Vested RSUs as specified in Section 4 of this Agreement.
2. Transferability of RSUs. Subject to Section 15 of the Plan, the rights of the Participant under this Agreement, the RSUs (prior to settlement) and any interest therein or in any Common Stock underlying such RSUs shall not be transferable other than by will or by the laws of descent and distribution. Upon any attempt to transfer, assign, pledge, hypothecate, or otherwise dispose of the RSUs or any related rights to the RSUs that is contrary to the provisions of this Agreement or the Plan, or upon the levy of any attachment or similar process upon the RSUs or such rights, the RSUs and such rights shall immediately become null and void.
3. Vesting of RSUs.
3.1 Normal Vesting. Subject to Sections 3.2 through 3.5 of this Agreement, the RSUs will Vest in full on , 20 (and become entitled to settlement as specified in Section 4 of this Agreement) if the Participant remains continuously employed by either the Company or any Subsidiary until such date (the Vesting Date). For purposes of this Agreement, the continuous employment of the Participant with the Company or any Subsidiary will not be deemed to have been interrupted, and the Participant shall not be deemed to have ceased to be an employee of the Company or any Subsidiary, by reason of the transfer of the Participants employment among the Company and its Subsidiaries.
3.2 Pro-Rata Vesting Due to Death or Becoming Disabled. If, prior to the Vesting Date, the Participant dies or becomes Disabled while in the employ of the Company or any Subsidiary, then, to the extent that the RSUs have not previously been forfeited, a pro-rata number of the RSUs shall Vest (and become entitled to settlement as specified in Section 4 of this Agreement), with such pro-rata number of RSUs being determined by multiplying (a) the total number of RSUs comprising the award by (b) a fraction (i) the numerator of which is the total number of calendar days in the period commencing with the Date of Grant and ending on the date of such death or the date on which the Participant became Disabled and (ii) the denominator of which is the number of days in the period commencing with the Date of Grant and ending on the Vesting Date, with any fractional share rounded down to the nearest whole number. The balance of the RSUs evidenced by this Agreement and not Vested under this Section 3.2 shall be immediately forfeited without compensation or other consideration. For purposes of this Agreement, the Participant shall be considered to have become Disabled if the Participant has qualified for a long-term disability benefit under a disability plan or program of the Company or, in the absence of a disability plan or program of the Company, under a government-sponsored disability program, and is disabled within the meaning of Section 409A(a)(2)(C) of the Code.
3.3 Accelerated Vesting Upon Retirement. If the Participant ceases to be employed by the Company or any Subsidiary prior to the Vesting Date due to the Participants retirement in accordance with any retirement plan or policy of the Company or any Subsidiary (Retirement), to the extent that the RSUs have not previously been forfeited, all RSUs evidenced by this Agreement shall Vest in full upon such Retirement (and become entitled to settlement as specified in Section 4 of this Agreement).
3.4 Accelerated Vesting in Connection with a Change in Control.
(a) Upon a Change in Control occurring after the Date of Grant but prior to the Vesting Date, if the Participant has been continuously employed by either the Company or any Subsidiary between the Date of Grant and the date of such Change in Control, to the extent that the RSUs have not previously been forfeited, the RSUs shall Vest in full (and become entitled to settlement as specified in Section 4 of this Agreement), except to the extent that a Replacement Award is provided to the Participant to replace, continue or adjust the outstanding RSUs (the Replaced Award). If the Participant is provided with a Replacement Award in connection with the Change in Control, then if, upon or after receiving the Replacement Award, the Participants employment with the Company or any Subsidiary (or any of their successors after the Change in Control) (as applicable, the Successor) is terminated by the Participant for Good Reason or by the Successor other than for Cause (excluding, for the avoidance of doubt, termination due to the Participants death, Disability, retirement or voluntary resignation), in each case within a period of two years after the Change in Control but prior to the Vesting Date, to the extent that the Replacement Award has not previously been forfeited, (i) the Replacement Award will Vest in full (and become entitled to settlement as specified in Section 4 of this Agreement).
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(b) For purposes of this Agreement, a Replacement Award means an award (i) of the same type (i.e., time-based restricted stock units) as the Replaced Award, (ii) that has a value at least equal to the value of the Replaced Award, (iii) that relates to publicly traded equity securities of the Successor in the Change in Control (or another entity that is affiliated with the Successor following the Change in Control), (iv) the tax consequences of which for such Participant under the Code, if the Participant is subject to U.S. federal income tax under the Code, are not less favorable to the Participant than the tax consequences of the Replaced Award, and (v) the other terms and conditions of which are not less favorable to the Participant than the terms and conditions of the Replaced Award (including the provisions that would apply in the event of a subsequent change in control). A Replacement Award may be granted only to the extent it does not result in the Replaced Award or Replacement Award failing to comply with or ceasing to be exempt from Section 409A of the Code, if applicable. Without limiting the generality of the foregoing, the Replacement Award may take the form of a continuation of the Replaced Award if the requirements of the preceding two sentences are satisfied. The determination of whether the conditions of this Section 3.4(b) are satisfied will be made in good faith by the Committee, as constituted immediately before the Change in Control, in its sole discretion.
(c) For purposes of this Agreement, Cause has the meaning set forth in the Participants employment, change in control, or severance agreement, as applicable (in that order), or otherwise means: (i) the Participants gross negligence or serious misconduct (including, without limitation, any criminal, fraudulent or dishonest conduct) that is or may be injurious to the Successor; or (ii) the Participant being convicted of, or entering a plea of nolo contendere to, any crime that constitutes a felony or involves moral turpitude; or (iii) the Participants breach of a written agreement between the Participant and the Successor; or (iv) the Participants willful and continued failure to perform the Participants duties on behalf of the Successor; or (v) the Participants material breach of a written policy of the Successor.
(d) For purposes of this Agreement, Good Reason means: (i) a material change in the geographic location at which the Participant must perform the Participants services (which shall in no event include a relocation of the Participants current principal place of business to a location less than 50 miles away) from the geographic location immediately prior to the Change of Control; (ii) a material diminution in the Participants base compensation from the level immediately prior to the Change of Control; or (iii) a material diminution in the Participants authority, duties, or responsibilities from the level immediately prior to the Change of Control; provided, however, that no termination shall be deemed to be for Good Reason unless (x) the Participant provides the Successor with
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written notice setting forth the specific facts or circumstances constituting Good Reason within ninety (90) days after the initial existence of the occurrence of such facts or circumstances, (y) the Successor has failed to cure such facts or circumstances within thirty (30) days of its receipt of such written notice, and (z) the effective date of the termination for Good Reason occurs no later than one hundred fifty (150) days after the initial existence of the facts or circumstances constituting Good Reason.
(e) If a Replacement Award is provided, notwithstanding anything in this Agreement or the Plan to the contrary, any outstanding RSUs that at the time of the Change in Control are not subject to a substantial risk of forfeiture (within the meaning of Section 409A of the Code) will be deemed to be Vested at the time of such Change in Control and will be settled as provided for in Section 4 of this Agreement.
3.5 Forfeiture Upon Other Terminations of Employment. Any RSUs that have not Vested pursuant to Section 3 of this Agreement on or prior to the Vesting Date will be forfeited automatically and without further notice on such date without compensation or any other consideration (or earlier if, and on such date that, the Participant ceases to be an employee of the Company or any Subsidiary prior to the Vesting Date for any reason other than as described in Sections 3.2 through 3.4 of this Agreement). For purposes of this Section 3, the Participant shall have ceased to be employed by the Company or any Subsidiary when the Participant no longer has the right or obligation to perform services in such capacity, notwithstanding the continuation of any employment agreement for any other purpose or the continuation of compensation or benefits under any such employment agreement or otherwise.
4. Form and Time of Settlement of RSUs.
4.1 General. Subject to Sections 3.5 and 4.2 of this Agreement, settlement of the RSUs that have become Vested in accordance with Section 3 of this Agreement shall be made in the form of a single lump sum cash amount equal to the Market Value per Share of one share of Common Stock for each Vested RSU within 30 days following the Vesting dates specified in Section 3.
4.2 Other Settlement Events. Notwithstanding Section 4.1 of this Agreement, to the extent that the RSUs are Vested on the dates set forth below, settlement with respect to the RSUs will be made as follows:
(a) Change in Control. Upon a Change in Control, the Participant is entitled to receive payment for Vested RSUs in the form of a single lump sum cash amount equal to the Market Value per Share of one share of Common Stock for each Vested RSU on the date of the Change in Control; provided, however, that if such Change in Control would not qualify as a permissible date of distribution under Section 409A(a)(2)(A) of the Code, and the regulations thereunder, and where Section 409A of the Code applies to such distribution, the
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Participant is entitled to receive the corresponding payment on the date that would have otherwise applied pursuant to Sections 4.1 or 4.2(b) of this Agreement as though such Change in Control had not occurred.
(b) Death or Disability. On the date of the Participants death or the date the Participant becomes Disabled, the Participant is entitled to receive payment for Vested RSUs in the form of a single lump sum cash amount equal to the Market Value per Share of one share of Common Stock for each Vested RSU on such date.
5. Payment of Dividend Equivalents. From and after the Date of Grant and until the earlier of (a) the time when the RSUs become Vested and are settled in accordance with Sections 3 and 4 of this Agreement or (b) the time when the Participants right to receive payment in settlement of the RSUs is forfeited in accordance with Section 3 of this Agreement, on the date that the Company pays a cash dividend (if any) to holders of Common Stock generally, the Participant shall be entitled to a number of additional RSUs determined by dividing (x) the product of (i) the dollar amount of the cash dividend paid per share of Common Stock on such date and (ii) the total number of RSUs (including dividend equivalents paid thereon) previously credited to the Participant as of such date, by (y) the Market Value per Share of the Common Stock on such date. Such dividend equivalents (if any) shall be subject to the same terms and conditions and shall be paid, in the aggregate rounded down to the nearest whole number, or forfeited in the same manner and at the same time as the RSUs to which the dividend equivalents were credited.
6. Tax Withholding. Subject to Section 16 of the Plan, to the extent that the Company is required to withhold federal, state, local or foreign taxes in connection with any payment made or benefit realized by the Participant or other person under the RSUs, and the amounts available to the Company for such withholding are insufficient, it will be a condition to the receipt of such payment or the realization of such benefit that the Participant or such other person make arrangements satisfactory to the Company for payment of the balance of such taxes required to be withheld, which arrangements (in the discretion of the Committee) may include relinquishment of a portion of such benefit.
7. Adjustments. The Committee shall make or provide for such adjustments in the number of shares of Common Stock covered by the RSUs and in the kind of shares covered by the RSUs as the Committee, in its sole discretion, exercised in good faith, may determine is equitably required to prevent dilution or enlargement of the rights of the Participant that otherwise would result from (a) any stock dividend, stock split, combination of shares, recapitalization or other change in the capital structure of the Company, (b) any merger, consolidation, spin-off, split-off, spin-out, split-up, reorganization, partial or complete liquidation or other distribution of assets, issuance of rights or warrants to purchase securities, or (c) any other corporate transaction or event having an effect similar to any of the foregoing. Moreover, in the event of any such transaction or event or in the event of a Change in Control, the Committee, in its discretion, shall provide in substitution for the RSUs such alternative consideration (including cash), if any, as it, in good faith, may determine to be equitable in the
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circumstances and may require in connection therewith the surrender of the RSUs in a manner that complies with Section 409A of the Code. Any action taken by the Committee pursuant to this Section 7 will only be taken to the extent it does not result in the RSUs failing to comply with or ceasing to be exempt from Section 409A of the Code.
8. Special Incentive Compensation. The Participant agrees that the award of the RSUs is special incentive compensation and that it, any dividend equivalents paid thereon (even if treated as compensation for tax purposes) and any other property received on account of such RSUs will not be taken into account as salary or compensation or bonus in determining the amount of any payment under any pension, retirement or profit-sharing plan of the Company or any life insurance, disability or other benefit plan of the Company.
9. Relationship to the Plan. This Agreement is subject to the terms of the Plan and any related administrative policies or procedures adopted by the Company. If there is any inconsistency between this Agreement and the Plan or any such administrative policies or procedures, the Plan and the policies or procedures, in that order, shall govern (except that, with respect to Sections 3.4 and 4.1 of this Agreement, the terms of this Agreement shall govern in the case of an inconsistency between Section 3.4 or 4.1 of this Agreement and the Plan).
10. No Effect on Employment Relationship. This Agreement is not intended to have any effect upon the Participants employment relationship with the Company or any Subsidiary. Nothing in this Agreement shall interfere with or affect the rights of the Company or the Participant under any employment agreement or confer upon the Participant any right to continued employment with the Company or any Subsidiary.
11. Forfeiture upon Termination due to Violation of the Code of Conduct and Ethics. Notwithstanding any other provisions of this Agreement, if the Participants employment with the Company or any Subsidiary is terminated on account of a violation of the Companys Code of Conduct and Ethics, the RSUs will be forfeited upon such termination.
12. Binding Effect. Subject to the provisions of the Plan, this Agreement shall inure to the benefit of and be binding upon the Participant and the Company and their respective heirs, legal representatives, successors and assigns.
13. Amendments. Any amendment to the Plan shall be deemed to be an amendment to this Agreement to the extent that the amendment is applicable hereto; provided, however, that no amendment shall adversely affect the rights of the Participant under this Agreement without the Participants consent (provided, however, that the Participants consent shall not be required to an amendment that is deemed necessary by the Company to ensure compliance with Section 409A of the Code). No amendment, modification, waiver or release of or under this Agreement will be effective unless evidenced by an instrument in writing signed by each of the Company and the Participant.
14. Compliance with Law. The Company shall make reasonable efforts to comply with all applicable federal, state and non-U.S. securities laws; provided, however, notwithstanding any other provision of this Agreement, the Company shall not be obligated to issue any Common Stock pursuant to this Agreement if the issuance thereof would result in a violation of any such law.
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15. Compliance with Section 409A of the Code. To the extent applicable, it is intended that this Agreement and the Plan comply with the provisions of Section 409A of the Code, so that the income inclusion provisions of Section 409A(a)(1) of the Code do not apply to the Participant. This Agreement and the Plan shall be interpreted in a manner consistent with this intent. Reference to Section 409A of the Code is to Section 409A of the Internal Revenue Code of 1986, as amended, and will also include any proposed, temporary or final regulations, or any other guidance promulgated with respect to such Section by the U.S. Department of the Treasury or the Internal Revenue Service.
16. Severability. If any provision of this Agreement or the application of any provision hereof to any person or circumstances is held invalid, unenforceable or otherwise illegal, the remainder of this Agreement and the application of such provision to any other person or circumstances shall not be affected, and the provisions so held to be invalid, unenforceable or otherwise illegal shall be reformed to the extent (and only to the extent) necessary to make it enforceable, valid and legal.
17. Electronic Delivery. The Company may, in its sole discretion, deliver any documents related to the RSUs and the Participants participation in the Plan, or future awards that may be granted under the Plan, by electronic means or to request the Participants consent to participate in the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and, if requested, agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.
18. Nature of Grant. The Participant acknowledges and agrees that: (a) the Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time; (b) the grant of RSUs is voluntary and occasional and does not create any contractual or other right to receive future grants of RSUs, or benefits in lieu of RSUs, even if RSUs have been granted repeatedly in the past; (c) all decisions with respect to future RSU grants, if any, will be at the sole discretion of the Company; (d) participation in the Plan is voluntary; (e) the RSUs are not a part of normal or expected compensation or salary for any purposes, including, but not limited to, calculating any severance, resignation, termination, redundancy, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments; (f) the future value of the underlying shares of Common Stock is unknown and cannot be predicted with certainty; and (g) in consideration of the grant of RSUs, no claim or entitlement to compensation or damages shall arise from termination of the RSUs or diminution in value of the RSUs including (without limitation) any claim or entitlement resulting from termination of the Participants employment with the Company or any Subsidiary or affiliate (for any reason whatsoever and whether or not in breach of local labor laws) and the Participant hereby releases the Company and its Subsidiaries and affiliates from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by signing this Agreement, the Participant shall be deemed irrevocably to have waived the Participants entitlement to pursue such claim.
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19. Data Privacy. The Participant explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of the Participants personal data by and among, as applicable, the Company and its Subsidiaries and affiliates, namely OM Group, Inc. (located in the United States of America), and the entities listed on Annex A (located in the countries designated on Annex A) for the exclusive purpose of implementing, administering and managing the Participants participation in the Plan. The Participant hereby understands that the Company and its Subsidiaries and affiliates hold (but only process or transfer to the extent required or permitted by local law) the following personal information about the Participant: the Participants name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of Common Stock or directorships held in the Company, details of all RSUs or any other entitlement to shares of Common Stock awarded, canceled, exercised, vested, unvested or outstanding in the Participants favor, for the purpose of implementing, administering and managing the Plan (Data). The Participant hereby understands that Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, including the entities listed on Annex B (located in the countries designated on Annex B) that these recipients may be located in the Participants country or elsewhere (including countries outside of the European Economic Area such as the United States of America), and that the recipients country may have different data privacy laws and protections than the Participants country. The Participant hereby understands that the Participant may request a list with the names and addresses of any potential recipients of the Data by contacting the Participants local human resources representative. The Participant authorizes the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing the Participants participation in the Plan, including any requisite transfer of such Data as may be required to a broker or other third party with whom the Participant may elect to deposit any shares acquired upon vesting of the RSUs. The Participant hereby understands that Data will be held only as long as is necessary to implement, administer and manage the Participants participation in the Plan and in accordance with local law. The Participant hereby understands that the Participant may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing the Participants local human resources representative. The Participant hereby understands, however, that refusing or withdrawing the Participants consent may affect the Participants ability to participate in the Plan. For more information on the consequences of the Participants refusal to consent or withdrawal of consent, the Participant hereby understands that the Participant may contact the Participants local human resources representative.
[SIGNATURES ON NEXT PAGE]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.
PARTICIPANT | OM GROUP, INC. | |||||||
By: |
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By: |
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[NAME] | [NAME] | |||||||
Title: | [TITLE] |
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Annex A
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Annex B
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Exhibit 10.4
Form of U.S. Non-Qualified Stock Option Agreement (2014 Plan)
OM GROUP, INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
THIS NON-QUALIFIED STOCK OPTION AGREEMENT (the Agreement), dated as of , 201 , is by and between OM GROUP, INC. (the Company) and (the Participant). All terms used in this Agreement with initial capital letters and not otherwise defined in this Agreement that are defined in the Companys 2014 Equity and Incentive Compensation Plan (the Plan) shall have the meanings assigned to them in the Plan.
WHEREAS, the Company maintains the Plan for the purpose of attracting and retaining non-employee Directors, officers and other key executives and employee of the Company and its Subsidiaries and to provide to such persons incentives and rewards for performance;
WHEREAS, pursuant to the Plan, and subject to the terms and conditions thereof and the terms and conditions hereinafter set forth, this Agreement evidences and memorializes the Companys grant to the Participant, effective as of , 201 (the Date of Grant) an Option Right (the Option) to purchase shares of Common Stock at an Option Price of $ per share, which represents at least the Market Value per Share on the Date of Grant (the Option Exercise Price); and
WHEREAS, the Option is intended to constitute a non-qualified stock option and shall not be treated as an incentive stock option within the meaning of that term under Section 422 of the Code.
NOW, THEREFORE, the Company and the Participant agree as follows:
Section 1. Normal Vesting and Exercise. Except as otherwise provided in Sections 2, 3, 4, 5, 6, 7 and 9, the Option will vest and become exercisable in substantially equal installments on each of the first anniversaries of the Date of Grant if the Participant remains continuously employed by either the Company or any Subsidiary until such dates (such -year period, the Vesting Period). For purposes of this Agreement, the continuous employment of the Participant with the Company or any Subsidiary will not be deemed to have been interrupted, and the Participant shall not be deemed to have ceased to be an employee of the Company or any Subsidiary, by reason of the transfer of the Participants employment among the Company and its Subsidiaries. To the extent the Option is exercisable, it may be exercised in whole or in part.
Section 2. Accelerated Vesting and Exercisability Upon Death. If the Participant shall die while employed by the Company or any Subsidiary, to the extent that the Option has not previously been forfeited, the Option will fully vest and become fully exercisable, and the person entitled by will or the applicable laws of descent and distribution to exercise the Option on behalf of the Participant may exercise the Option for a period of three years following the Participants death or until the expiration of the stated term of the Option, whichever period is shorter.
Section 3. Accelerated Vesting and Exercisability in Connection with Disability. If the Participant ceases to be employed by the Company or any Subsidiary due to the Disability of the Participant, to the extent that the Option has not previously been forfeited, the Option will fully vest and become fully exercisable, and the Participant may exercise the Option for a period of three years following such date of the cessation of the Participants employment due to Disability or until the expiration of the stated term of the Option, whichever period is shorter. For purposes of this Agreement, the Participant shall be considered to have a Disability if the Participant has qualified for a long-term disability benefit under a disability plan or program of the Company or, in the absence of a disability plan or program of the Company, under a government-sponsored disability program, and is disabled within the meaning of Section 409A(a)(2)(C) of the Code.
Section 4. Accelerated Vesting and Exercisability Upon Retirement. If the Participant ceases to be employed by the Company or any Subsidiary due to the Participants retirement in accordance with any retirement plan or policy of the Company or any Subsidiary (Retirement), to the extent that the Option has not previously been forfeited, the Option will fully vest and become fully exercisable, and the Participant may exercise the Option for a period of five years following such Retirement or until the expiration of the stated term of the Option, whichever period is shorter.
Section 5. Exercisability Upon Death After Retirement or Termination due to Disability. If the Participant shall die following the cessation of employment with the Company or any Subsidiary, and such death occurs within the exercise period provided for in Section 3 or 4, as applicable, the Option will remain fully exercisable for the period set forth in the applicable Section 3 or 4, and the person entitled by will or the applicable laws of descent and distribution to exercise the Option on behalf of the Participant may exercise the Option during such applicable period or until the expiration of the stated term of the Option, whichever period is shorter.
Section 6. Accelerated Vesting in Connection With a Change in Control.
(a) | Upon a Change in Control occurring during the Vesting Period, if the Participant has been continuously employed by either the Company or any Subsidiary between the Date of Grant and the date of such Change in Control, to the extent that the Option has not previously been forfeited, the Option will fully vest and become fully exercisable, except to the extent that a Replacement Award is provided to the Participant to replace, continue or adjust the outstanding Option (the Replaced Award). If the Participant is provided with a Replacement Award in connection with the Change in Control, then if, upon or after receiving the Replacement Award, the Participants employment with the Company or any Subsidiary (or any of their successors after the Change in Control) (as applicable, the Successor) is terminated by the Participant for Good Reason or by the Successor other than for Cause (excluding, for the avoidance of doubt, termination due to the Participants death, Disability, retirement or voluntary resignation), in each case within a period of two years after the Change in Control and during the Vesting Period, to the extent that the Replacement Award has not |
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previously been forfeited, (i) the Replacement Award will become fully vested and immediately exercisable in full, and (ii) the Replacement Award will remain exercisable for a period of 90 days following such termination or until the expiration of the stated term of such Replacement Award, whichever period is shorter. |
(b) | For purposes of this Agreement, a Replacement Award means an award (i) of the same type (i.e., stock options) as the Replaced Award, (ii) that has a value at least equal to the value of the Replaced Award, (iii) that relates to publicly traded equity securities of the Successor in the Change in Control (or another entity that is affiliated with the Successor following the Change in Control), (iv) the tax consequences of which for such Participant under the Code, if the Participant is subject to U.S. federal income tax under the Code, are not less favorable to the Participant than the tax consequences of the Replaced Award, and (v) the other terms and conditions of which are not less favorable to the Participant than the terms and conditions of the Replaced Award (including the provisions that would apply in the event of a subsequent change in control). A Replacement Award may be granted only to the extent it does not result in the Replaced Award or Replacement Award failing to comply with or ceasing to be exempt from Section 409A of the Code. Without limiting the generality of the foregoing, the Replacement Award may take the form of a continuation of the Replaced Award if the requirements of the preceding two sentences are satisfied. The determination of whether the conditions of this Section 2(b) are satisfied will be made in good faith by the Committee, as constituted immediately before the Change in Control, in its sole discretion. |
(c) | For purposes of this Agreement, Cause has the meaning set forth in the Participants employment, change in control, or severance agreement, as applicable (in that order), or otherwise means: (i) the Participants gross negligence or serious misconduct (including, without limitation, any criminal, fraudulent or dishonest conduct) that is or may be injurious to the Successor; or (ii) the Participant being convicted of, or entering a plea of nolo contendere to, any crime that constitutes a felony or involves moral turpitude; or (iii) the Participants breach of a written agreement between the Participant and the Successor; or (iv) the Participants willful and continued failure to perform the Participants duties on behalf of the Successor; or (v) the Participants material breach of a written policy of the Successor. |
(d) | For purposes of this Agreement, Good Reason means: (i) a material change in the geographic location at which the Participant must perform the Participants services (which shall in no event include a relocation of the Participants current principal place of business to a location less than 50 miles away) from the geographic location immediately prior to the Change of Control; (ii) a material diminution in the Participants base compensation from the level immediately prior to the Change of Control; or (iii) a material diminution in the Participants authority, duties, or responsibilities from the level immediately prior to the Change of Control; provided, however, that no termination shall be deemed to be |
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for Good Reason unless (x) the Participant provides the Successor with written notice setting forth the specific facts or circumstances constituting Good Reason within ninety (90) days after the initial existence of the occurrence of such facts or circumstances, (y) the Successor has failed to cure such facts or circumstances within thirty (30) days of its receipt of such written notice, and (z) the effective date of the termination for Good Reason occurs no later than one hundred fifty (150) days after the initial existence of the facts or circumstances constituting Good Reason. |
Section 7. Exercisability and Forfeiture Upon Other Terminations of Employment. If the Participant ceases to be employed by the Company or any Subsidiary for any reason other than those described in Sections 2, 3, 4 and 6 above, to the extent that the Option has not previously been forfeited, the Option will cease vesting, but the Participant may exercise the Option (to the same extent the Participant was entitled to exercise the Option immediately prior to such termination of employment) for a period of 90 days following the date of such termination of employment or until the expiration of the stated term of the Option, whichever period is shorter.
Section 8. Term of the Option. Notwithstanding any other provisions of this Agreement, the Option will not be exercisable after , 20 , which date is one day immediately prior to the tenth annual anniversary of the Date of Grant.
Section 9. Forfeiture upon Termination due to Violation of the Code of Conduct and Ethics. Notwithstanding any other provisions of this Agreement, if the Participants employment with the Company or any Subsidiary is terminated on account of a violation of the Companys Code of Conduct and Ethics, the Option will be forfeited upon such termination to the full extent not previously exercised at the time of such termination. In addition, the Participant acknowledges and agrees that the terms and conditions set forth in any clawback or recoupment policy adopted by the Board and in effect from time to time apply to the Option. To the extent such policy is applicable to the Participant, it creates additional rights for the Company with respect to the Option.
Section 10. Transferability. Subject to Section 15 of the Plan, the Option is not transferable by the Participant other than by will, by the laws of descent and distribution, or in accordance with a domestic relations order or comparable order that is issued and is applicable to the Participant, and the Option is exercisable, during the lifetime of the Participant, only by the Participant or the Participants guardian or legal representative. Upon any attempt to transfer, assign, pledge, hypothecate, or otherwise dispose of the Option or any related rights to the Option that is contrary to the provisions of this Agreement or the Plan, or upon the levy of any attachment or similar process upon the Option or such rights, the Option and such rights shall immediately become null and void.
Section 11. Prevented Exercise. Subject in all cases to the expiration of the stated term of the Option, if the Participants exercise of this option is prevented under the terms of subsections (a), (b) or (c) of Section 15 and the Option terminates prior to the stated term of the Option pursuant to Section 4 or 5, then the Participant may, notwithstanding the provisions of Section 4 or 5, exercise the Option to the extent it would have been exercisable immediately prior to its termination but for the operation of Section 15 at any time within 30 days after such Participant is notified by the Company that such exercise is no longer prevented under Section 15.
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Section 12. Adjustments. The Committee shall make or provide for such adjustments in the number of shares of Common Stock covered by the Option, in the Option Exercise Price, and in the kind of shares covered by the Option as the Committee, in its sole discretion, exercised in good faith, may determine is equitably required to prevent dilution or enlargement of the rights of the Participant that otherwise would result from (a) any stock dividend, stock split, combination of shares, recapitalization or other change in the capital structure of the Company, (b) any merger, consolidation, spin-off, split-off, spin-out, split-up, reorganization, partial or complete liquidation or other distribution of assets, issuance of rights or warrants to purchase securities, or (c) any other corporate transaction or event having an effect similar to any of the foregoing. Moreover, in the event of any such transaction or event or in the event of a Change in Control, the Committee, in its discretion, shall provide in substitution for the Option such alternative consideration (including cash), if any, as it, in good faith, may determine to be equitably required in the circumstances and may require in connection therewith the surrender of the Option in a manner that complies with Section 409A of the Code. In addition, if the Option Exercise Price is greater than the consideration offered in connection with any such transaction or event or Change in Control, the Committee may in its sole discretion elect to cancel the Option without any payment to the Participant. Notwithstanding anything to the contrary contained in this Agreement, the Participant will not be entitled to purchase a fraction of a share under the Option.
Section 13. Manner of Exercise. Subject to the terms and conditions of this Agreement, the Option shall be exercised in whole or in part by delivering to the Company at its principal place of business a written notice, signed by the person entitled to exercise the Option, of the election to exercise the Option and stating the number of shares to be purchased. Such notice shall, as an essential part, be accompanied by the payment of the full Option Exercise Price of the shares then to be purchased, except as provided below. Payment of the full Option Exercise Price shall be made, at the election of the Participant, in (a) cash or by check acceptable to the Company or by wire transfer of immediately available funds, (b) by the actual or constructive transfer to the Company of Common Stock owned by the Participant having a value at the time of exercise equal to the full Option Exercise Price, (c) the Companys withholding of Common Stock otherwise issuable upon exercise of the Option pursuant to a net exercise arrangement, (d) by a combination of such methods of payment, or (e) by such other methods as may be approved by the Committee. To the extent permitted by applicable law, the Participant may elect to pay the Option Exercise Price upon the exercise of the Option by authorizing a third party to sell all the shares (or a sufficient portion of the shares) acquired upon the exercise of the Option and to remit to the Company a sufficient portion of the sale proceeds to pay the entire Option Exercise Price and any tax withholding resulting from such exercise. The Participant agrees that as holder of this option, the Participant shall have no rights as a stockholder or otherwise in respect of any of the shares underlying the Option until the Option is effectively exercised as provided in this Agreement.
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Subject to Section 16 of the Plan, to the extent that the Company is required to withhold federal, state, local or foreign taxes in connection with any payment made or benefit realized by the Participant or other person under the Option, and the amounts available to the Company for such withholding are insufficient, it will be a condition to the receipt of such payment or the realization of such benefit that the Participant or such other person make arrangements satisfactory to the Company for payment of the balance of such taxes required to be withheld, which arrangements (in the discretion of the Committee) may include relinquishment of a portion of such benefit. If the Participant fails to make arrangements for the payment of such tax, then, unless otherwise determined by the Committee, the Company will withhold shares of Common Stock having a value equal to the amount required to be withheld from the Option exercise. Notwithstanding the foregoing, the Participant may elect, unless otherwise determined by the Committee, to satisfy the obligation, in whole or in part, by having withheld, from the shares required to be delivered to the Participant, shares of Common Stock having a value equal to the amount required to be withheld, or by delivering to the Company other shares of Common Stock held by the Participant. The shares used for tax withholding will be valued at an amount equal to the market value of such Common Stock on the date the benefit is to be included in Participants income. In no event will the market value of the Common Stock to be withheld and delivered pursuant to this Section 13 to satisfy applicable withholding taxes in connection with the benefit exceed the minimum amount of taxes required to be withheld.
Section 14. No Dividend Equivalents. The Participant shall not be entitled to dividend equivalents with respect to the Option or the shares underlying the Option.
Section 15. Compliance with Laws. This option shall not be exercisable if such exercise would violate:
(a) | Any applicable state securities law; |
(b) | Any applicable registration or other requirements under the Securities Act of 1933, as amended (the Act), the Exchange Act, or applicable listing requirements of any stock exchange; or |
(c) | Any applicable legal requirement of any other governmental authority. |
The Company agrees to make reasonable efforts to comply with the foregoing laws and requirements so as to permit the exercise of the Option. Furthermore, if a registration statement with respect to the shares to be issued upon the exercise of the Option is not in effect or if counsel for the Company deems it necessary or desirable in order to avoid possible violation of the Act, the Company may require, as a condition to its issuance and delivery of certificates for, or providing for book entry of, the shares, the delivery to the Company of a commitment in writing by the person exercising the Option that at the time of such exercise it is such persons intention to acquire such shares for such persons own account for investment only and not with a view to, or for resale in connection with, the distribution thereof; that such person understands the shares may be restricted securities as defined in Rule 144 under the Act; and that any resale, transfer or other disposition of said shares will be accomplished only in compliance with Rule 144, the Act, and any other applicable rules and regulations under the Act. The Company may place on the certificates evidencing such shares, or in book entry for such shares, an appropriate legend reflecting such commitment and the Company may refuse to permit transfer of such certificates or the shares until it has been furnished evidence satisfactory to it that no violation of the Act or the rules and regulations under the Act would be involved in such transfer.
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Section 16. Relationship to the Plan. This Agreement is subject to the terms of the Plan and any related administrative policies or procedures adopted by the Company. If there is any inconsistency between this Agreement and the Plan or any such administrative policies or procedures, the Plan and the policies or procedures, in that order, shall govern. Nothing in this Agreement shall interfere with or affect the rights of the Company or the Participant under any employment agreement or confer upon the Participant any right to continued employment with the Company or any Subsidiary.
Section 17. Compliance with Section 409A of the Code. To the extent applicable, it is intended that this Agreement comply with the provisions of Section 409A of the Code, so that the income inclusion provisions of Section 409A(a)(1) of the Code do not apply to the Participant. This Agreement shall be administered in a manner consistent with this intent. Reference to Section 409A of the Code is to Section 409A of the Internal Revenue Code of 1986, as amended, and will also include any regulations or any other formal guidance promulgated with respect to such Section by the U.S. Department of the Treasury or the Internal Revenue Service.
Section 18. Amendments. Any amendment to the Plan shall be deemed to be an amendment to this Agreement to the extent that the amendment is applicable hereto; provided, however, that no amendment shall adversely affect the rights of the Participant under this Agreement without the Participants consent (provided, however, that the Participants consent shall not be required to an amendment that is deemed necessary by the Company to ensure compliance with Section 409A of the Code). No amendment, modification, waiver or release of or under this Agreement will be effective unless evidenced by an instrument in writing signed by each of the Company and the Participant.
Section 19. Severability. If any provision of this Agreement or the application of any provision hereof to any person or circumstances is held invalid, unenforceable or otherwise illegal, the remainder of this Agreement and the application of such provision to any other person or circumstances shall not be affected, and the provisions so held to be invalid, unenforceable or otherwise illegal shall be reformed to the extent (and only to the extent) necessary to make it enforceable, valid and legal.
Section 20. Binding Effect. Subject to the provisions of the Plan, this Agreement shall inure to the benefit of and be binding upon the Participant and the Company and their respective heirs, legal representatives, successors and assigns.
Section 21. Electronic Delivery. The Company may, in its sole discretion, deliver any documents related to the Option and the Participants participation in the Plan, or future awards that may be granted under the Plan, by electronic means or to request the Participants consent to participate in the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and, if requested, agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.
PARTICIPANT | OM GROUP, INC. | |||||
By: |
|
By: |
| |||
[NAME] | [NAME] | |||||
Title: | [TITLE] |
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Exhibit 10.5
Form of U.S. Performance-Based Restricted Stock Agreement (2014 Plan)
OM GROUP, INC.
PERFORMANCE-BASED RESTRICTED STOCK AGREEMENT
THIS PERFORMANCE-BASED RESTRICTED STOCK AGREEMENT (the Agreement), dated as of , 201 , is by and between OM GROUP, INC. (the Company) and (the Participant). All terms used in this Agreement with initial capital letters and not otherwise defined in this Agreement that are defined in the Companys 2014 Equity and Incentive Compensation Plan (the Plan) shall have the meanings assigned to them in the Plan.
WHEREAS, the Company maintains the Plan for the purpose of attracting and retaining non-employee Directors, officers and other key executives and employee of the Company and its Subsidiaries and to provide to such persons incentives and rewards for performance;
WHEREAS, pursuant to the Plan, and subject to the terms and conditions thereof and the terms and conditions hereinafter set forth, this Agreement evidences and memorializes the Companys grant to the Participant, effective as of , 201 (the Date of Grant) of performance-based shares of Restricted Stock (the Restricted Stock). Subject to the achievement of the Management Objectives described in Section 3 of this Agreement, the Participant may earn between 0% and 100% of the Restricted Stock.
NOW, THEREFORE, the Company and the Participant agree as follows:
1. Restrictions on Transfer of Restricted Stock. Subject to Section 15 of the Plan, the Participant shall not be entitled to sell, exchange, transfer, pledge, hypothecate, assign or otherwise dispose of the Restricted Stock until such time that such Restricted Stock has vested in accordance with this Agreement. Any attempted sale, exchange, transfer, pledge, hypothecation, assignment or other disposition of such Restricted Stock in violation of this Agreement shall be void and of no effect and the Company shall have the right to disregard the same on its books and records.
2. Evidence of Award. Following execution of this Agreement, the Company shall cause the Restricted Stock to be represented either by a certificate issued in the name of the Participant or by electronic direct registration, registered in the name of the Participant. Such certificate or electronic registration shall bear the following legend, together with any other legend deemed necessary or desirable by the Company in order to comply with applicable laws or to ensure the enforceability of the provisions of the Plan or this Agreement:
The sale or other transfer of the shares represented by this certificate is subject to certain restrictions set forth in the Restricted Stock Agreement between (the registered owner) and OM Group, Inc., dated as of . A copy of such restrictions may be obtained from the Secretary of OM Group, Inc.
Any such stock certificate shall be held by the Company (or its designated agent) on behalf of the Participant until such time as the Restricted Stock has vested or is forfeited in accordance with this Agreement.
3. Rights Relating to Restricted Stock. The Restricted Stock shall constitute issued and outstanding shares of Common Stock, and the Participant shall be entitled to exercise voting rights pertaining to the Restricted Stock. In the event dividends are paid by the Company with respect to its Common Stock prior to such time as the Restricted Stock has vested in accordance with this Agreement, such dividends shall be distributed to and held by the Company (or its designated agent) in the same manner as the Restricted Stock and be either distributed to the Participant upon vesting of the Restricted Stock or forfeited in accordance with this Agreement. In the event that shares of Common Stock or other securities are distributed to owners of outstanding Common Stock by reason of a stock dividend, stock split, recapitalization or otherwise, such shares or securities received by the Participant shall be encompassed within the term Restricted Stock for purposes of this Agreement and the Participant shall deliver to the Company all such shares or securities received, to be held by the Company on behalf of the Participant subject to the same restrictions as the Restricted Stock.
4. Vesting of Restricted Stock.
4.1 Normal Vesting. Subject to Sections 4.2 through 4.5 of this Agreement, the Restricted Stock will vest (meaning that the restrictions set forth in this Agreement shall no longer be applicable and the Restricted Stock shall no longer be subject to forfeiture as provided in this Agreement) based on the relative achievement of the Management Objective(s) approved by the Committee on the Date of Grant (the Performance Targets) for the performance period from January 1, 20 through December 31, 20 (the Performance Period) as follows:
(a) The applicable percentage of the Restricted Stock that shall be earned by the Participant for the Performance Period shall be determined by reference to the Performance Matrix for the Performance Period approved by the Committee on the Date of Grant and communicated to the Participant in writing (the Performance Matrix) if the Participant remains continuously employed by either the Company or any Subsidiary until the end of the Performance Period. For purposes of this Agreement, the continuous employment of the Participant with the Company or any Subsidiary will not be deemed to have been interrupted, and the Participant shall not be deemed to have ceased to be an employee of the Company or any Subsidiary, by reason of the transfer of the Participants employment among the Company and its Subsidiaries;
(b) In the event that achievement with respect to one of the Performance Targets is between the performance levels specified in the Performance Matrix, the applicable percentage of the Restricted Stock that shall be earned by the Participant for the Performance Period for that particular Performance Target shall be determined by the Committee using straight-line mathematical interpolation;
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(c) To the extent the Performance Targets are not achieved by the end of the Performance Period, then the Restricted Stock evidenced by this Agreement will be forfeited without compensation or other consideration. The vesting of the Restricted Stock pursuant to this Section 4.1 shall be contingent upon a determination of the Committee that the Performance Metrics have been satisfied; and
(d) In the absence of a prior forfeiture of the Restricted Stock pursuant to this Agreement, as promptly as practicable after the Restricted Stock vests and compliance with Section 6 of this Agreement, the Company shall, if applicable, cause a new certificate or certificates to be issued in the name of the Participant, or the Participants designee, in exchange for the certificate for the Restricted Stock that is described in Section 3 of this Agreement. Such new certificate shall not contain the legend set forth in Section 3 of this Agreement but may contain any other legend the Company believes is appropriate in order to comply with applicable securities law requirements.
4.2 Pro-Rata Vesting Due to Death or Becoming Disabled. If, prior to the end of the Performance Period, the Participant dies or becomes Disabled while in the employ of the Company or any Subsidiary, then, to the extent that the Restricted Stock has not previously been forfeited, a pro-rata number of shares of Restricted Stock shall remain eligible for vesting after the end of the Performance Period, with such pro-rata number of shares of Restricted Stock being determined by multiplying (a) the number of shares of Restricted Stock in which the Participant would have vested in accordance with the terms and conditions of Section 4.1 if the Participant had remained in the continuous employment of the Company or any Subsidiary from the Date of Grant until the end of the Performance Period (or the occurrence of a Change in Control to the extent a Replacement Award is not provided) by (b) a fraction (i) the numerator of which is the total number of calendar days in the period commencing with the start of the Performance Period and ending on the date of such death or the date on which the Participant became Disabled and (ii) the denominator of which is the number of days in the Performance Period, with any fractional share rounded down to the nearest whole number. The balance of the Restricted Stock evidenced by this Agreement and not subject to pro-rata eligibility for vesting under this Section 4.2 shall be immediately forfeited without compensation or other consideration. For purposes of this Agreement, the Participant shall be considered to have become Disabled if the Participant has qualified for a long-term disability benefit under a disability plan or program of the Company or, in the absence of a disability plan or program of the Company, under a government-sponsored disability program, and is disabled within the meaning of Section 409A(a)(2)(C) of the Code.
4.3 Pro-Rata Vesting Due to Retirement. If the Participant ceases to be employed by the Company or any Subsidiary prior to the end of the Performance Period due to the Participants retirement in accordance with any retirement plan or policy of the Company or any Subsidiary (Retirement), then, to the extent that the Restricted Stock
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has not previously been forfeited, a pro-rata number of shares of Restricted Stock shall remain eligible for vesting after the end of the Performance Period, with such pro-rata number of shares of Restricted Stock being determined by multiplying (a) the number of shares of Restricted Stock in which the Participant would have vested in accordance with the terms and conditions of Section 4.1 if the Participant had remained in the continuous employment of the Company or any Subsidiary from the Date of Grant until the end of the Performance Period (or the occurrence of a Change in Control to the extent a Replacement Award is not provided) by (b) a fraction (i) the numerator of which is the total number of calendar days in the period commencing with the start of the Performance Period and ending on the date of such Retirement and (ii) the denominator of which is the number of days in the Performance Period, with any fractional share rounded down to the nearest whole number. The balance of the Restricted Stock evidenced by this Agreement and not subject to pro-rata eligibility for Vesting under this Section 4.3 shall be immediately forfeited without compensation or other consideration.
4.4 | Accelerated Vesting in Connection with a Change in Control. |
(a) Upon a Change in Control occurring after the Date of Grant but prior to the end of the Performance Period, if the Participant has been continuously employed by either the Company or any Subsidiary between the Date of Grant and the date of such Change in Control, to the extent that the Restricted Stock has not previously been forfeited, the Restricted Stock shall vest in full at the target level (50% of the Restricted Stock), except to the extent that a Replacement Award is provided to the Participant to replace, continue or adjust the outstanding Restricted Stock (the Replaced Award). If the Participant is provided with a Replacement Award in connection with the Change in Control, then if, upon or after receiving the Replacement Award, the Participants employment with the Company or any Subsidiary (or any of their successors after the Change in Control) (as applicable, the Successor) is terminated by the Participant for Good Reason or by the Successor other than for Cause (excluding, for the avoidance of doubt, termination due to the Participants death, Disability, retirement or voluntary resignation), in each case within a period of two years after the Change in Control but prior to the end of the Performance Period, to the extent that the Replacement Award has not previously been forfeited, (i) the Replacement Award will vest in full at the target level (50% of the Restricted Stock).
(b) For purposes of this Agreement, a Replacement Award means an award (i) of the same type (i.e., performance-based restricted stock) as the Replaced Award, (ii) that has a value at least equal to the value of the Replaced Award, (iii) that relates to publicly traded equity securities of the Successor in the Change in Control (or another entity that is affiliated with the Successor following the Change in Control), (iv) the tax consequences of which for such Participant under the Code, if the Participant is subject to U.S. federal income tax under the Code, are not less favorable to the Participant than the tax consequences of the
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Replaced Award, and (v) the other terms and conditions of which are not less favorable to the Participant than the terms and conditions of the Replaced Award (including the provisions that would apply in the event of a subsequent change in control). A Replacement Award may be granted only to the extent it does not result in the Replaced Award or Replacement Award failing to comply with or ceasing to be exempt from Section 409A of the Code, if applicable. Without limiting the generality of the foregoing, the Replacement Award may take the form of a continuation of the Replaced Award if the requirements of the preceding two sentences are satisfied. The determination of whether the conditions of this Section 4.4(b) are satisfied will be made in good faith by the Committee, as constituted immediately before the Change in Control, in its sole discretion.
(c) For purposes of this Agreement, Cause has the meaning set forth in the Participants employment, change in control, or severance agreement, as applicable (in that order), or otherwise means: (i) the Participants gross negligence or serious misconduct (including, without limitation, any criminal, fraudulent or dishonest conduct) that is or may be injurious to the Successor; or (ii) the Participant being convicted of, or entering a plea of nolo contendere to, any crime that constitutes a felony or involves moral turpitude; or (iii) the Participants breach of a written agreement between the Participant and the Successor; or (iv) the Participants willful and continued failure to perform the Participants duties on behalf of the Successor; or (v) the Participants material breach of a written policy of the Successor.
(d) For purposes of this Agreement, Good Reason means: (i) a material change in the geographic location at which the Participant must perform the Participants services (which shall in no event include a relocation of the Participants current principal place of business to a location less than 50 miles away) from the geographic location immediately prior to the Change of Control; (ii) a material diminution in the Participants base compensation from the level immediately prior to the Change of Control; or (iii) a material diminution in the Participants authority, duties, or responsibilities from the level immediately prior to the Change of Control; provided, however, that no termination shall be deemed to be for Good Reason unless (x) the Participant provides the Successor with written notice setting forth the specific facts or circumstances constituting Good Reason within ninety (90) days after the initial existence of the occurrence of such facts or circumstances, (y) the Successor has failed to cure such facts or circumstances within thirty (30) days of its receipt of such written notice, and (z) the effective date of the termination for Good Reason occurs no later than one hundred fifty (150) days after the initial existence of the facts or circumstances constituting Good Reason.
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(e) If a Replacement Award is provided, notwithstanding anything in this Agreement or the Plan to the contrary, any outstanding Restricted Stock that at the time of the Change in Control are not subject to a substantial risk of forfeiture (within the meaning of Section 409A of the Code) will be deemed to be vested at the time of such Change in Control.
4.5 Forfeiture Upon Other Terminations of Employment. Any Restricted Stock that has not vested pursuant to Section 4 of this Agreement on or prior to the end of the Performance Period will be forfeited automatically and without further notice on such date without compensation or any other consideration (or earlier if, and on such date that, the Participant ceases to be an employee of the Company or any Subsidiary prior to the end of the Performance Period for any reason other than as described in Sections 4.2 through 4.4 of this Agreement). For purposes of this Section 4, the Participant shall have ceased to be employed by the Company or any Subsidiary when the Participant no longer has the right or obligation to perform services in such capacity, notwithstanding the continuation of any employment agreement for any other purpose or the continuation of compensation or benefits under any such employment agreement or otherwise.
5. Tax Withholding. Subject to Section 16 of the Plan, to the extent that the Company is required to withhold federal, state, local or foreign taxes in connection with any payment made or benefit realized by the Participant or other person under the Restricted Stock, and the amounts available to the Company for such withholding are insufficient, it will be a condition to the receipt of such payment or the realization of such benefit that the Participant or such other person make arrangements satisfactory to the Company for payment of the balance of such taxes required to be withheld, which arrangements (in the discretion of the Committee) may include relinquishment of a portion of such benefit. If the Participant fails to make arrangements for the payment of such tax, then, unless otherwise determined by the Committee, the Company will withhold shares of Common Stock having a value equal to the amount required to be withheld from the Restricted Stock vesting. Notwithstanding the foregoing, the Participant may elect, unless otherwise determined by the Committee, to satisfy the obligation, in whole or in part, by having withheld, from the shares required to be delivered to the Participant, shares of Common Stock having a value equal to the amount required to be withheld, or by delivering to the Company other shares of Common Stock held by the Participant. The shares used for tax withholding will be valued at an amount equal to the market value of such Common Stock on the date the benefit is to be included in Participants income. In no event will the market value of the Common Stock to be withheld and delivered pursuant to this Section 5 to satisfy applicable withholding taxes in connection with the benefit exceed the minimum amount of taxes required to be withheld.
6. Adjustments. The Committee shall make or provide for such adjustments in the number of shares of Common Stock covered by the Restricted Stock and in the kind of shares covered by the Restricted Stock as the Committee, in its sole discretion, exercised in good faith, may determine is equitably required to prevent dilution or enlargement of the rights of the Participant that otherwise would result from (a) any stock dividend, stock split, combination of shares, recapitalization or other change in the capital structure of the Company, (b) any merger, consolidation, spin-off, split-off, spin-out, split-up, reorganization, partial or complete liquidation or other distribution of assets, issuance of rights or warrants to purchase securities, or
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(c) any other corporate transaction or event having an effect similar to any of the foregoing. Moreover, in the event of any such transaction or event or in the event of a Change in Control, the Committee, in its discretion, shall provide in substitution for the Restricted Stock such alternative consideration (including cash), if any, as it, in good faith, may determine to be equitable in the circumstances and may require in connection therewith the surrender of the Restricted Stock in a manner that complies with Section 409A of the Code. Any action taken by the Committee pursuant to this Section 6 will only be taken to the extent it does not result in the Restricted Stock failing to comply with or ceasing to be exempt from Section 409A of the Code.
7. Special Incentive Compensation. The Participant agrees that the award of the Restricted Stock is special incentive compensation and that it, any dividend equivalents paid thereon (even if treated as compensation for tax purposes) and any other property received on account of such Restricted Stock will not be taken into account as salary or compensation or bonus in determining the amount of any payment under any pension, retirement or profit-sharing plan of the Company or any life insurance, disability or other benefit plan of the Company.
8. Relationship to the Plan. This Agreement is subject to the terms of the Plan and any related administrative policies or procedures adopted by the Company. If there is any inconsistency between this Agreement and the Plan or any such administrative policies or procedures, the Plan and the policies or procedures, in that order, shall govern (except that, with respect to Section 4.4 of this Agreement, the terms of this Agreement shall govern in the case of an inconsistency between Section 4.4 of this Agreement and the Plan).
9. No Effect on Employment Relationship. This Agreement is not intended to have any effect upon the Participants employment relationship with the Company or any Subsidiary. Nothing in this Agreement shall interfere with or affect the rights of the Company or the Participant under any employment agreement or confer upon the Participant any right to continued employment with the Company or any Subsidiary.
10. Forfeiture upon Termination due to Violation of the Code of Conduct and Ethics. Notwithstanding any other provisions of this Agreement, if the Participants employment with the Company or any Subsidiary is terminated on account of a violation of the Companys Code of Conduct and Ethics, the Restricted Stock will be forfeited upon such termination.
11. Binding Effect. Subject to the provisions of the Plan, this Agreement shall inure to the benefit of and be binding upon the Participant and the Company and their respective heirs, legal representatives, successors and assigns.
12. Amendments. Any amendment to the Plan shall be deemed to be an amendment to this Agreement to the extent that the amendment is applicable hereto; provided, however, that no amendment shall adversely affect the rights of the Participant under this Agreement without the Participants consent (provided, however, that the Participants consent shall not be required to an amendment that is deemed necessary by the Company to ensure compliance with Section 409A of the Code). No amendment, modification, waiver or release of or under this Agreement will be effective unless evidenced by an instrument in writing signed by each of the Company and the Participant.
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13. Compliance with Law. The Company shall make reasonable efforts to comply with all applicable federal and state securities laws; provided, however, notwithstanding any other provision of this Agreement, the Company shall not be obligated to issue any Common Stock pursuant to this Agreement if the issuance thereof would result in a violation of any such law.
14. Compliance with Section 409A of the Code. To the extent applicable, it is intended that this Agreement and the Plan comply with the provisions of Section 409A of the Code, so that the income inclusion provisions of Section 409A(a)(1) of the Code do not apply to the Participant. This Agreement and the Plan shall be interpreted in a manner consistent with this intent. Reference to Section 409A of the Code is to Section 409A of the Internal Revenue Code of 1986, as amended, and will also include any proposed, temporary or final regulations, or any other guidance promulgated with respect to such Section by the U.S. Department of the Treasury or the Internal Revenue Service.
15. Severability. If any provision of this Agreement or the application of any provision hereof to any person or circumstances is held invalid, unenforceable or otherwise illegal, the remainder of this Agreement and the application of such provision to any other person or circumstances shall not be affected, and the provisions so held to be invalid, unenforceable or otherwise illegal shall be reformed to the extent (and only to the extent) necessary to make it enforceable, valid and legal.
16. Electronic Delivery. The Company may, in its sole discretion, deliver any documents related to the Restricted Stock and the Participants participation in the Plan, or future awards that may be granted under the Plan, by electronic means or to request the Participants consent to participate in the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and, if requested, agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.
PARTICIPANT | OM GROUP, INC. | |||||||
By: |
|
By: |
| |||||
[NAME] | [NAME] | |||||||
Title: | [TITLE] |
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Exhibit 10.6
Form of U.S. Time-Based RSU Agreement (2014 Plan)
OM GROUP, INC.
TIME-BASED RESTRICTED STOCK UNITS AGREEMENT
THIS TIME-BASED RESTRICTED STOCK UNITS AGREEMENT (the Agreement), dated as of , 201 , is by and between OM GROUP, INC. (the Company) and (the Participant). All terms used in this Agreement with initial capital letters and not otherwise defined in this Agreement that are defined in the Companys 2014 Equity and Incentive Compensation Plan (the Plan) shall have the meanings assigned to them in the Plan.
WHEREAS, the Company maintains the Plan for the purpose of attracting and retaining non-employee Directors, officers and other key executives and employee of the Company and its Subsidiaries and to provide to such persons incentives and rewards for performance;
WHEREAS, pursuant to the Plan, and subject to the terms and conditions thereof and the terms and conditions hereinafter set forth, this Agreement evidences and memorializes the Companys grant to the Participant, effective as of , 201 (the Date of Grant) of Restricted Stock Units (the RSUs).
NOW, THEREFORE, the Company and the Participant agree as follows:
1. Earning of RSUs. If the RSUs under this Agreement become nonforfeitable and payable (Vest or similar terms) in accordance with Section 3 of this Agreement, the Participant will be entitled to settlement of the Vested RSUs as specified in Section 4 of this Agreement.
2. Transferability of RSUs. Subject to Section 15 of the Plan, the rights of the Participant under this Agreement, the RSUs (prior to settlement) and any interest therein or in any Common Stock underlying such RSUs shall not be transferable other than by will or by the laws of descent and distribution. Upon any attempt to transfer, assign, pledge, hypothecate, or otherwise dispose of the RSUs or any related rights to the RSUs that is contrary to the provisions of this Agreement or the Plan, or upon the levy of any attachment or similar process upon the RSUs or such rights, the RSUs and such rights shall immediately become null and void.
3. Vesting of RSUs.
3.1 Normal Vesting. Subject to Sections 3.2 through 3.5 of this Agreement, the RSUs will Vest in full on , 20 (and become entitled to settlement as specified in Section 4 of this Agreement) if the Participant remains continuously employed by either the Company or any Subsidiary until such date (the Vesting Date). For purposes of this Agreement, the continuous employment of the Participant with the Company or any Subsidiary will not be deemed to have been interrupted, and the Participant shall not be deemed to have ceased to be an employee of the Company or any Subsidiary, by reason of the transfer of the Participants employment among the Company and its Subsidiaries.
3.2 Pro-Rata Vesting Due to Death or Becoming Disabled. If, prior to the Vesting Date, the Participant dies or becomes Disabled while in the employ of the Company or any Subsidiary, then, to the extent that the RSUs have not previously been forfeited, a pro-rata number of the RSUs shall Vest (and become entitled to settlement as specified in Section 4 of this Agreement), with such pro-rata number of RSUs being determined by multiplying (a) the total number of RSUs comprising the award by (b) a fraction (i) the numerator of which is the total number of calendar days in the period commencing with the Date of Grant and ending on the date of such death or the date on which the Participant became Disabled and (ii) the denominator of which is the number of days in the period commencing with the Date of Grant and ending on the Vesting Date, with any fractional share rounded down to the nearest whole number. The balance of the RSUs evidenced by this Agreement and not Vested under this Section 3.2 shall be immediately forfeited without compensation or other consideration. For purposes of this Agreement, the Participant shall be considered to have become Disabled if the Participant has qualified for a long-term disability benefit under a disability plan or program of the Company or, in the absence of a disability plan or program of the Company, under a government-sponsored disability program, and is disabled within the meaning of Section 409A(a)(2)(C) of the Code.
3.3 Accelerated Vesting Upon Retirement. If the Participant ceases to be employed by the Company or any Subsidiary prior to the Vesting Date due to the Participants retirement in accordance with any retirement plan or policy of the Company or any Subsidiary (Retirement), to the extent that the RSUs have not previously been forfeited, all RSUs evidenced by this Agreement shall Vest in full upon such Retirement (and become entitled to settlement as specified in Section 4 of this Agreement).
3.4 Accelerated Vesting in Connection with a Change in Control.
(a) Upon a Change in Control occurring after the Date of Grant but prior to the Vesting Date, if the Participant has been continuously employed by either the Company or any Subsidiary between the Date of Grant and the date of such Change in Control, to the extent that the RSUs have not previously been forfeited, the RSUs shall Vest in full (and become entitled to settlement as specified in Section 4 of this Agreement), except to the extent that a Replacement Award is provided to the Participant to replace, continue or adjust the outstanding RSUs (the Replaced Award). If the Participant is provided with a Replacement Award in connection with the Change in Control, then if, upon or after receiving the Replacement Award, the Participants employment with the Company or any Subsidiary (or any of their successors after the Change in Control) (as applicable, the Successor) is terminated by the Participant for Good Reason or by the Successor other than for Cause (excluding, for the avoidance of doubt, termination due to the Participants death, Disability, retirement or voluntary resignation), in each case within a period of two years after the Change in Control but prior to the Vesting Date, to the extent that the Replacement Award has not previously been forfeited, (i) the Replacement Award will Vest in full (and become entitled to settlement as specified in Section 4 of this Agreement).
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(b) For purposes of this Agreement, a Replacement Award means an award (i) of the same type (i.e., time-based restricted stock units) as the Replaced Award, (ii) that has a value at least equal to the value of the Replaced Award, (iii) that relates to publicly traded equity securities of the Successor in the Change in Control (or another entity that is affiliated with the Successor following the Change in Control), (iv) the tax consequences of which for such Participant under the Code, if the Participant is subject to U.S. federal income tax under the Code, are not less favorable to the Participant than the tax consequences of the Replaced Award, and (v) the other terms and conditions of which are not less favorable to the Participant than the terms and conditions of the Replaced Award (including the provisions that would apply in the event of a subsequent change in control). A Replacement Award may be granted only to the extent it does not result in the Replaced Award or Replacement Award failing to comply with or ceasing to be exempt from Section 409A of the Code. Without limiting the generality of the foregoing, the Replacement Award may take the form of a continuation of the Replaced Award if the requirements of the preceding two sentences are satisfied. The determination of whether the conditions of this Section 3.4(b) are satisfied will be made in good faith by the Committee, as constituted immediately before the Change in Control, in its sole discretion.
(c) For purposes of this Agreement, Cause has the meaning set forth in the Participants employment, change in control, or severance agreement, as applicable (in that order), or otherwise means: (i) the Participants gross negligence or serious misconduct (including, without limitation, any criminal, fraudulent or dishonest conduct) that is or may be injurious to the Successor; or (ii) the Participant being convicted of, or entering a plea of nolo contendere to, any crime that constitutes a felony or involves moral turpitude; or (iii) the Participants breach of a written agreement between the Participant and the Successor; or (iv) the Participants willful and continued failure to perform the Participants duties on behalf of the Successor; or (v) the Participants material breach of a written policy of the Successor.
(d) For purposes of this Agreement, Good Reason means: (i) a material change in the geographic location at which the Participant must perform the Participants services (which shall in no event include a relocation of the Participants current principal place of business to a location less than 50 miles away) from the geographic location immediately prior to the Change of Control; (ii) a material diminution in the Participants base compensation from the level immediately prior to the Change of Control; or (iii) a material diminution in the Participants authority, duties, or responsibilities from the level immediately prior to the Change of Control; provided, however, that no termination shall be deemed to be for Good Reason unless (x) the Participant provides the Successor with
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written notice setting forth the specific facts or circumstances constituting Good Reason within ninety (90) days after the initial existence of the occurrence of such facts or circumstances, (y) the Successor has failed to cure such facts or circumstances within thirty (30) days of its receipt of such written notice, and (z) the effective date of the termination for Good Reason occurs no later than one hundred fifty (150) days after the initial existence of the facts or circumstances constituting Good Reason.
(e) If a Replacement Award is provided, notwithstanding anything in this Agreement or the Plan to the contrary, any outstanding RSUs that at the time of the Change in Control are not subject to a substantial risk of forfeiture (within the meaning of Section 409A of the Code) will be deemed to be Vested at the time of such Change in Control and will be settled as provided for in Section 4 of this Agreement.
3.5 Forfeiture Upon Other Terminations of Employment. Any RSUs that have not Vested pursuant to Section 3 of this Agreement on or prior to the Vesting Date will be forfeited automatically and without further notice on such date without compensation or any other consideration (or earlier if, and on such date that, the Participant ceases to be an employee of the Company or any Subsidiary prior to the Vesting Date for any reason other than as described in Sections 3.2 through 3.4 of this Agreement). For purposes of this Section 3, the Participant shall have ceased to be employed by the Company or any Subsidiary when the Participant no longer has the right or obligation to perform services in such capacity, notwithstanding the continuation of any employment agreement for any other purpose or the continuation of compensation or benefits under any such employment agreement or otherwise.
4. Form and Time of Settlement of RSUs.
4.1 General. Subject to Sections 3.5 and 4.2 of this Agreement, settlement of the RSUs that have become Vested in accordance with Section 3 of this Agreement shall be made in the form of one share of Common Stock for each RSU within 30 days following the Vesting dates specified in Section 3.
4.2 Other Settlement Events. Notwithstanding Section 4.1 of this Agreement, to the extent that the RSUs are Vested on the dates set forth below, settlement with respect to the RSUs will be made as follows:
(a) Change in Control. Upon a Change in Control, the Participant is entitled to receive payment for Vested RSUs in the form of one share of Common Stock for each RSU on the date of the Change in Control; provided, however, that if such Change in Control would not qualify as a permissible date of distribution under Section 409A(a)(2)(A) of the Code, and the regulations thereunder, and where Section 409A of the Code applies to such distribution, the Participant is entitled to receive the corresponding payment on the date that would have otherwise applied pursuant to Sections 4.1 or 4.2(b) of this Agreement as though such Change in Control had not occurred.
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(b) Death or Disability. On the date of the Participants death or the date the Participant becomes Disabled, the Participant is entitled to receive payment for Vested RSUs in the form of one share of Common Stock for each RSU on such date.
5. Payment of Dividend Equivalents. From and after the Date of Grant and until the earlier of (a) the time when the RSUs become Vested and are settled in accordance with Sections 3 and 4 of this Agreement or (b) the time when the Participants right to receive shares of Common Stock in settlement of the RSUs is forfeited in accordance with Section 3 of this Agreement, on the date that the Company pays a cash dividend (if any) to holders of Common Stock generally, the Participant shall be entitled to a number of additional RSUs determined by dividing (x) the product of (i) the dollar amount of the cash dividend paid per share of Common Stock on such date and (ii) the total number of RSUs (including dividend equivalents paid thereon) previously credited to the Participant as of such date, by (y) the Market Value per Share of the Common Stock on such date. Such dividend equivalents (if any) shall be subject to the same terms and conditions and shall be paid, in the aggregate rounded down to the nearest whole number, or forfeited in the same manner and at the same time as the RSUs to which the dividend equivalents were credited.
6. Tax Withholding. Subject to Section 16 of the Plan, to the extent that the Company is required to withhold federal, state, local or foreign taxes in connection with any payment made or benefit realized by the Participant or other person under the RSUs, and the amounts available to the Company for such withholding are insufficient, it will be a condition to the receipt of such payment or the realization of such benefit that the Participant or such other person make arrangements satisfactory to the Company for payment of the balance of such taxes required to be withheld, which arrangements (in the discretion of the Committee) may include relinquishment of a portion of such benefit. If the Participant fails to make arrangements for the payment of such tax, then, unless otherwise determined by the Committee, the Company will withhold shares of Common Stock having a value equal to the amount required to be withheld from the RSU Vesting/settlement. Notwithstanding the foregoing, the Participant may elect, unless otherwise determined by the Committee, to satisfy the obligation, in whole or in part, by having withheld, from the shares required to be delivered to the Participant, shares of Common Stock having a value equal to the amount required to be withheld, or by delivering to the Company other shares of Common Stock held by the Participant. The shares used for tax withholding will be valued at an amount equal to the market value of such Common Stock on the date the benefit is to be included in Participants income. In no event will the market value of the Common Stock to be withheld and delivered pursuant to this Section 6 to satisfy applicable withholding taxes in connection with the benefit exceed the minimum amount of taxes required to be withheld.
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7. Adjustments. The Committee shall make or provide for such adjustments in the number of shares of Common Stock covered by the RSUs and in the kind of shares covered by the RSUs as the Committee, in its sole discretion, exercised in good faith, may determine is equitably required to prevent dilution or enlargement of the rights of the Participant that otherwise would result from (a) any stock dividend, stock split, combination of shares, recapitalization or other change in the capital structure of the Company, (b) any merger, consolidation, spin-off, split-off, spin-out, split-up, reorganization, partial or complete liquidation or other distribution of assets, issuance of rights or warrants to purchase securities, or (c) any other corporate transaction or event having an effect similar to any of the foregoing. Moreover, in the event of any such transaction or event or in the event of a Change in Control, the Committee, in its discretion, shall provide in substitution for the RSUs such alternative consideration (including cash), if any, as it, in good faith, may determine to be equitable in the circumstances and may require in connection therewith the surrender of the RSUs in a manner that complies with Section 409A of the Code. Any action taken by the Committee pursuant to this Section 7 will only be taken to the extent it does not result in the RSUs failing to comply with or ceasing to be exempt from Section 409A of the Code.
8. Special Incentive Compensation. The Participant agrees that the award of the RSUs is special incentive compensation and that it, any dividend equivalents paid thereon (even if treated as compensation for tax purposes) and any other property received on account of such RSUs will not be taken into account as salary or compensation or bonus in determining the amount of any payment under any pension, retirement or profit-sharing plan of the Company or any life insurance, disability or other benefit plan of the Company.
9. Relationship to the Plan. This Agreement is subject to the terms of the Plan and any related administrative policies or procedures adopted by the Company. If there is any inconsistency between this Agreement and the Plan or any such administrative policies or procedures, the Plan and the policies or procedures, in that order, shall govern (except that, with respect to Sections 3.4 and 4.1 of this Agreement, the terms of this Agreement shall govern in the case of an inconsistency between Section 3.4 or 4.1 of this Agreement and the Plan).
10. No Effect on Employment Relationship. This Agreement is not intended to have any effect upon the Participants employment relationship with the Company or any Subsidiary. Nothing in this Agreement shall interfere with or affect the rights of the Company or the Participant under any employment agreement or confer upon the Participant any right to continued employment with the Company or any Subsidiary.
11. Forfeiture upon Termination due to Violation of the Code of Conduct and Ethics. Notwithstanding any other provisions of this Agreement, if the Participants employment with the Company or any Subsidiary is terminated on account of a violation of the Companys Code of Conduct and Ethics, the RSUs will be forfeited upon such termination.
12. Binding Effect. Subject to the provisions of the Plan, this Agreement shall inure to the benefit of and be binding upon the Participant and the Company and their respective heirs, legal representatives, successors and assigns.
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13. Amendments. Any amendment to the Plan shall be deemed to be an amendment to this Agreement to the extent that the amendment is applicable hereto; provided, however, that no amendment shall adversely affect the rights of the Participant under this Agreement without the Participants consent (provided, however, that the Participants consent shall not be required to an amendment that is deemed necessary by the Company to ensure compliance with Section 409A of the Code). No amendment, modification, waiver or release of or under this Agreement will be effective unless evidenced by an instrument in writing signed by each of the Company and the Participant.
14. Compliance with Law. The Company shall make reasonable efforts to comply with all applicable federal and state securities laws; provided, however, notwithstanding any other provision of this Agreement, the Company shall not be obligated to issue any Common Stock pursuant to this Agreement if the issuance thereof would result in a violation of any such law.
15. Compliance with Section 409A of the Code. To the extent applicable, it is intended that this Agreement and the Plan comply with the provisions of Section 409A of the Code, so that the income inclusion provisions of Section 409A(a)(1) of the Code do not apply to the Participant. This Agreement and the Plan shall be interpreted in a manner consistent with this intent. Reference to Section 409A of the Code is to Section 409A of the Internal Revenue Code of 1986, as amended, and will also include any proposed, temporary or final regulations, or any other guidance promulgated with respect to such Section by the U.S. Department of the Treasury or the Internal Revenue Service.
16. Severability. If any provision of this Agreement or the application of any provision hereof to any person or circumstances is held invalid, unenforceable or otherwise illegal, the remainder of this Agreement and the application of such provision to any other person or circumstances shall not be affected, and the provisions so held to be invalid, unenforceable or otherwise illegal shall be reformed to the extent (and only to the extent) necessary to make it enforceable, valid and legal.
17. Electronic Delivery. The Company may, in its sole discretion, deliver any documents related to the RSUs and the Participants participation in the Plan, or future awards that may be granted under the Plan, by electronic means or to request the Participants consent to participate in the Plan by electronic means. The Participant hereby consents to receive such documents by electronic delivery and, if requested, agrees to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.
PARTICIPANT | OM GROUP, INC. | |||||||
By: |
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By: |
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[NAME] | [NAME] | |||||||
Title: | [TITLE] |
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