Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34 Filing Table of Contents
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3: EX-10.15.17 Material Contract HTML 72K
4: EX-10.20 Material Contract HTML 76K
6: EX-21 Subsidiaries List HTML 47K
7: EX-23 Consent of Experts or Counsel HTML 46K
11: EX-95 Mine-Safety Disclosure HTML 46K
5: EX-12 Statement re: Computation of Ratios HTML 79K
8: EX-31.1 Certification -- §302 - SOA'02 HTML 53K
9: EX-31.2 Certification -- §302 - SOA'02 HTML 53K
10: EX-32 Certification -- §906 - SOA'02 HTML 48K
18: R1 Document and Entity Information HTML 72K
19: R2 Statements of Consolidated Operations HTML 158K
20: R3 Statements of Consolidated Comprehensive Income HTML 92K
21: R4 Statements of Consolidated Comprehensive Income HTML 62K
(Parenthetical)
22: R5 Statements of Consolidated Financial Position HTML 179K
23: R6 Statements of Consolidated Financial Position HTML 77K
(Parenthetical)
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25: R8 Statements of Consolidated Shareholders Equity HTML 108K
26: R9 Statements of Consolidated Shareholders Equity HTML 46K
(Parenthetical)
27: R10 Background and Basis of Presentation HTML 54K
28: R11 Significant Accounting Policies HTML 89K
29: R12 New Accounting Standards HTML 69K
30: R13 Business Combinations HTML 47K
31: R14 Restructuring HTML 151K
32: R15 Receivables HTML 96K
33: R16 Customer Financing Programs HTML 78K
34: R17 Variable Interest Entities HTML 66K
35: R18 Inventory HTML 68K
36: R19 Property, Plant and Equipment HTML 60K
37: R20 Goodwill and Other Intangible Assets HTML 104K
38: R21 Income Taxes HTML 136K
39: R22 Debt and Other Credit Arrangements HTML 98K
40: R23 Fair Value Measurements HTML 152K
41: R24 Financial Instruments HTML 359K
42: R25 Postretirement Benefits - Pensions HTML 540K
43: R26 Postretirement Benefits - Health Care and Other HTML 118K
Postemployment Benefits
44: R27 Employee Savings Plans HTML 49K
45: R28 Stock-Based Compensation Plans HTML 140K
46: R29 Capital Stock HTML 51K
47: R30 Accumulated Other Comprehensive Loss HTML 116K
48: R31 Earnings Per Share HTML 53K
49: R32 Supplemental Cash Flow Information HTML 60K
50: R33 Commitments and Contingencies HTML 145K
51: R34 Segment and Geographic Data HTML 173K
52: R35 Quarterly Data (Unaudited) HTML 147K
53: R36 Significant Accounting Policies (Policies) HTML 141K
54: R37 Restructuring Restructuring (Tables) HTML 119K
55: R38 Receivables (Tables) HTML 94K
56: R39 Customer Financing Programs (Tables) HTML 72K
57: R40 Variable Interest Entities (Tables) HTML 52K
58: R41 Inventory (Tables) HTML 69K
59: R42 Property, Plant and Equipment (Tables) HTML 58K
60: R43 Goodwill and Other Intangible Assets (Tables) HTML 101K
61: R44 Income Taxes (Tables) HTML 137K
62: R45 Debt and Other Credit Arrangements (Tables) HTML 97K
63: R46 Fair Value Measurements (Tables) HTML 134K
64: R47 Financial Instruments (Tables) HTML 346K
65: R48 Postretirement Benefits - Pensions (Tables) HTML 549K
66: R49 Postretirement Benefits - Health Care and Other HTML 126K
Postemployment Benefits (Tables)
67: R50 Stock-Based Compensation Plans (Tables) HTML 131K
68: R51 Accumulated Other Comprehensive Loss (Tables) HTML 117K
69: R52 Earnings Per Share (Tables) HTML 53K
70: R53 Supplemental Cash Flow (Tables) HTML 52K
71: R54 Commitments and Contingencies (Tables) HTML 126K
72: R55 Segment and Geographic Data (Tables) HTML 176K
73: R56 Quarterly Data (Unaudited) (Tables) HTML 146K
74: R57 BACKGROUND AND BASIS OF PRESENTATION Narrative HTML 78K
(Details)
75: R58 Significant Accounting Policies (Narrative) HTML 48K
(Details)
76: R59 Significant Accounting Policies (Other Intangible HTML 59K
Assets - Narrative) (Details)
77: R60 Significant Accounting Policies (Property, Plant HTML 55K
and Equipment - Narrative) (Details)
78: R61 Business Combinations (Narrative) (Details) HTML 47K
79: R62 RESTRUCTURING - Schedule of restructuring charges HTML 97K
recored in the statement of consolidated
operations (Details)
80: R63 RESTRUCTURING - Pretax restructuring charges HTML 106K
related to 2015 restructuring (Details)
81: R64 RESTRUCTURING - Restructuring Charges by Activity HTML 88K
(Details)
82: R65 RESTRUCTURING - Narrative (Details) HTML 88K
83: R66 Receivables (Details) HTML 78K
84: R67 Receivables (Trade Receivables by Customer HTML 71K
Concentration) (Details)
85: R68 Customer Financing Programs (Details) HTML 72K
86: R69 VARIABLE INTEREST ENTITIES Narrative (Details) HTML 73K
87: R70 VARIABLE INTEREST ENTITIES - Equity Method and HTML 53K
Cost Method Investments (Details)
88: R71 Inventory (Details) HTML 75K
89: R72 Inventory INVENTORY - Impairment (Details) HTML 62K
90: R73 Property, Plant and Equipment (Details) HTML 86K
91: R74 GOODWILL AND OTHER INTANGIBLE ASSETS Schedule of HTML 62K
net carrying amount of goodwill (Details)
92: R75 GOODWILL AND OTHER INTANGIBLE ASSETS Information HTML 78K
of other intangible assets (Details)
93: R76 GOODWILL AND OTHER INTANGIBLE ASSETS Schedule of HTML 56K
estimated amortization expense (Details)
94: R77 Income Taxes (Components of income from continuing HTML 52K
operations) (Details)
95: R78 Income Taxes (Components of income tax provision) HTML 72K
(Details)
96: R79 Income Taxes (Income Tax Reconciliation) (Details) HTML 71K
97: R80 Income Taxes (Components of deferred tax assets HTML 82K
and liabilities) (Details)
98: R81 Income Taxes (Narrative) (Details) HTML 66K
99: R82 Income Taxes (Reconciliation of unrecognized tax HTML 60K
benefits) (Details)
100: R83 Income Taxes (Years subject to examination) HTML 59K
(Details)
101: R84 Debt and Other Credit Arrangements (Short-term HTML 56K
Debt) (Details)
102: R85 Debt and Other Credit Arrangements (Long-term HTML 118K
Debt) (Details)
103: R86 Debt and Other Credit Arrangements (Narrative) HTML 121K
(Details)
104: R87 Debt and Other Credit Arrangements (Interest HTML 51K
expense) (Details)
105: R88 Fair Value Measurements (Fair Value Hierarchy HTML 94K
Levels) (Details)
106: R89 Fair Value Measurements (Summary of the Change in HTML 73K
Level 3 Liability) (Details)
107: R90 Fair Value Measurements (Narrative) (Details) HTML 79K
108: R91 FINANCIAL INSTRUMENTS Narrative (Details) HTML 70K
109: R92 FINANCIAL INSTRUMENTS Notional Amounts of HTML 59K
Derivative Instruments Outstanding (Details)
110: R93 FINANCIAL INSTRUMENTS Fair Value of Derivatives HTML 194K
Outstanding (Details)
111: R94 FINANCIAL INSTRUMENTS Gain (Loss) from Derivatives HTML 98K
(Details)
112: R95 Postretirement Benefits - Pensions (Narrative) HTML 78K
(Details)
113: R96 Postretirement Benefits - Pensions (Components of HTML 77K
Net Periodic Benefit Cost) (Details)
114: R97 Postretirement Benefits - Pensions (Changes HTML 68K
Recognized in OCI Pension) (Details)
115: R98 Postretirement Benefits - Pensions (Assumptions HTML 59K
Used to Determine Pension Costs) (Details)
116: R99 Postretirement Benefits - Pensions (Schedule of HTML 130K
Funded Status) (Details)
117: R100 Postretirement Benefits - Pensions (Assumptions HTML 54K
Used to Determine Pension Benefit Obligation)
(Details)
118: R101 Postretirement Benefits - Pensions (Projected HTML 55K
Benefit Obligations in Excess of Plan Assets)
(Details)
119: R102 Postretirement Benefits - Pensions (Accumulated HTML 59K
Benefit Obligations in Excess of Plan Assets)
(Details)
120: R103 Postretirement Benefits - Pensions (Net Amount HTML 66K
Recognized) (Details)
121: R104 Postretirement Benefits - Pensions (Pre-Tax HTML 59K
Components Recognized in AOCI Pension) (Details)
122: R105 Postretirement Benefits - Pensions (Pension Plan HTML 84K
Asset Allocation United States) (Details)
123: R106 Postretirement Benefits - Pensions (Pension Plan HTML 68K
Asset Allocation Foreign) (Details)
124: R107 Postretirement Benefits - Pensions (United States HTML 181K
Pension Plan Asset Fair Value) (Details)
125: R108 Postretirement Benefits - Pension (United States HTML 72K
Pension Plan Asset Level 3 Rollforward) (Details)
126: R109 Postretirement Benefits - Pensions (Investments at HTML 62K
Fair Value to Plan Assets Reconciliation)
(Details)
127: R110 Postretirement Benefits - Pensions (Foreign HTML 86K
Pension Plan Asset Fair Value) (Details)
128: R111 Postretirement Benefits - Pension (Foreign Pension HTML 61K
Plan Asset Level 3 Rollforward) (Details)
129: R112 Postretirement Benefits - Pension Summary of HTML 69K
Unfunded Commitments and Redemption Features
Measured Using NAV (Details)
130: R113 Postretirement Benefits - Pension (Expected Cash HTML 68K
Flows Pension) (Details)
131: R114 Postretirement Benefits - Health Care and Other HTML 59K
Postemployment Benefits (Net Periodic Cost
Postretirement) (Details)
132: R115 Postretirement Benefits - Health Care and Other HTML 65K
Postemployment Benefits (Changes Recognized in OCI
Postretirement) (Details)
133: R116 Postretirement Benefits - Health Care and Other HTML 64K
Postemployment Benefits (Narrative) (Details)
134: R117 Postretirement Benefits - Health Care and Other HTML 55K
Postemployment Benefits (Assumptions Used to
Determine Postretirement Costs) (Details)
135: R118 Postretirement Benefits - Health Care and Other HTML 63K
Postemployment Benefits (Benefit Obligations
Postretirement) (Details)
136: R119 Postretirement Benefits - Health Care and Other HTML 55K
Postemployment Benefits (Assumptions Used to
Determine Postretirement Benefit Obligation)
(Details)
137: R120 Postretirement Benefits - Health Care and Other HTML 56K
Postemployment Benefits (Postretirement Amounts
Recognized in Statements of Consolidated Financial
Position) (Details)
138: R121 Postretirement Benefits - Health Care and Other HTML 51K
Postemployment Benefits (Pre-Tax Components
Recognized in AOCI Postretirement) (Details)
139: R122 Postretirement Benefits - Health Care and Other HTML 63K
Postemployment Benefits (Expected Cash Flows
Postretirement) (Details)
140: R123 Employee Savings Plans (Details) HTML 62K
141: R124 Stock-Based Compensation Plans (Narrative) HTML 108K
(Details)
142: R125 Stock-Based Compensation Plans (Components of HTML 75K
Stock Based Compensation) (Details)
143: R126 Stock-Based Compensation Plans (Rollforward of HTML 66K
Stock Options) (Details)
144: R127 Stock-Based Compensation Plans (Restricted Stock) HTML 91K
(Details)
145: R128 Stock-Based Compensation Plans (Assumptions Used HTML 63K
to Value Stock Options) (Details)
146: R129 Capital Stock (Common Stock and Preferred Stock) HTML 58K
(Details)
147: R130 Capital Stock (Treasury Stock) (Details) HTML 58K
148: R131 Accumulated Other Comprehensive Loss (Details) HTML 114K
149: R132 Earnings Per Share (Details) HTML 52K
150: R133 Supplemental Cash Flow Information Supplemental HTML 49K
Cash Flow Information (Details)
151: R134 SUPPLEMENTAL CASH FLOW INFORMATION Narrative HTML 50K
(Details)
152: R135 Commitments and Contingencies (Contractual HTML 106K
Obligations) (Details)
153: R136 Commitments and Contingencies (Leases and HTML 48K
Guarantees Narrative) (Details)
154: R137 Commitments and Contingencies (Environmental HTML 51K
Liabilities Narrative) (Details)
155: R138 Commitments and Contingencies (Discounted and HTML 67K
Undiscounted Environmental and Litigation
Liabilities) (Details)
156: R139 Commitments and Contingencies (Environmental and HTML 53K
Litigation Liabilities) (Details)
157: R140 Commitments and Contingencies (Litigation HTML 66K
Narrative) (Details)
158: R141 Commitments and Contingencies Off-Balance Sheet HTML 47K
Arrangements (Details)
159: R142 Segment and Geographic Data (Operating Segment HTML 137K
Information) (Details)
160: R143 Segment and Geographic Data (The reconciliation of HTML 59K
EBIT to Net Income) (Details)
161: R144 Segment and Geographic Data (Net Sales And Long HTML 86K
Lived Assets by World Area) (Details)
162: R145 Quarterly Data (Unaudited) (Details) HTML 183K
163: R146 Subsequent Event (Details) HTML 49K
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Fiscal Year 2018 Financial Goal Restricted Stock Units Grant
Terms and Conditions
[for Chairman and CEO and Chief Technology Officer]1
You have received a grant of Restricted Stock Units (the “Units”) under the Monsanto Company 2005 Long-Term Incentive Plan, as amended (the “Plan”). The Grant Date and the number of Units initially covered by this grant (the
“Initial Number of Units”) are set forth in the document you have received entitled “Long-Term Incentive Statement.” The maximum number of Units that you may receive under this grant (the “Maximum Number of Units”) is two times the Initial Number of Units. The Long-Term Incentive Statement and these terms and conditions collectively constitute the Award Certificate for the Units, and describe the provisions applicable to the Units.
1. Definitions. Each capitalized term not otherwise defined herein has the meaning set forth in the Plan or, if not defined in the Plan, in the attached Long-Term Incentive Statement. The “Company” means Monsanto Company, a Delaware corporation incorporated February 9, 2000.
2. Nature of Units. The
Units represent the right to receive, in certain circumstances, a number of Shares determined in accordance with the Long-Term Incentive Statement and these terms and conditions. Until such time (if any) as Shares are delivered to you, you will not have any of the rights of a common stockholder of the Company with respect to those Shares, your rights with respect to the Units and those Shares will be those of a general creditor of the Company, and you may not sell, assign, transfer, pledge, hypothecate, give away, or otherwise dispose of the Units. Any attempt on your part to dispose of the Units will result in their being forfeited. However, you shall have the right to receive a cash payment (the “Dividend Equivalent Payment”) with respect to the Units (if any) that vest pursuant to this
Award Certificate, subject to withholding pursuant to Section 6 below, in an amount equal to the aggregate cash dividends that would have been paid to you if you had been the record owner, on each record date for a cash dividend during the period from the Grant Date through the settlement date of the Units, of a number of Shares equal to the number of Units that vest under this Award Certificate. The Dividend Equivalent Payment shall be made on such settlement date. You shall not be entitled to receive any payments with respect to any non-cash dividends or other distributions that may be made with respect to the Shares.
3. Vesting of Units.
(a) 162(m) Performance Goal. Subject to Section 5, in order to vest in the Maximum Number of Units or any lesser number of Units under this Award
Certificate, the 162(m) Performance Goal must be met (as determined and certified by the Committee following August 31, 2020). The “162(m) Performance Goal” is that the Company’s Net Income, as defined in the next sentence, must exceed zero for the period from September 1, 2017 through August 31, 2020. “Net Income” means gross profit (i) minus (A) sales, general and administrative expenses, (B) research and development expense, (C) amortization, (D) net interest expense, and (E) income taxes and (ii) plus or minus other income and expense; all as reported in the Company’s
financial statements; but excluding positive or negative effects of (I) restructuring charges and reversals, (II) the outcome of lawsuits, (III) the impact of liabilities, expenses, settlements or agreements related to the Company’s indemnification obligations to Pharmacia LLC or Solutia Inc, (IV) the impact of items related to the pendency or consequences of the transactions contemplated by the Agreement and Plan of Merger, by and among Bayer Aktiengesellschaft, KWA Investment Co., and the Company, dated as of September 14, 2016 (the “Merger Agreement”), (V) unbudgeted business sales and divestitures, and (VI) the cumulative effects of changes in accounting
methodology made after August 31, 2017.
(b) EPS, Cash Flow, and ROC Goals. If the Section 162(m) Performance Goal is met, then the number of Units eligible for vesting under this Award Certificate will be determined one-third based upon the Company’s achievement of cumulative earnings per share (the “EPS Goal”), one-third based upon the Company’s achievement of cumulative cash flow (the “Cash Flow Goal”), and one-third based upon the Company’s achievement of return on capital (the “ROC Goal,” and, together with the EPS Goal and the Cash Flow Goal, the
“Goals” and each, singularly, a “Goal”) for fiscal years 2018, 2019 and 2020 as compared to the Goals set forth on Exhibit A hereto. Not later than November 15, 2020, the Committee will determine the extent to which the Goals have been met, the number of Units that have vested under this Award Certificate, and the number of Units to be forfeited, as follows:
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1 Bracketed language indicates continued vesting provisions included in terms and conditions of grant to Chairman and CEO and Chief Technology Officer
Below
Threshold-Level Performance: For each Goal as to which performance is below threshold level, one-third of the Initial Number of Units shall be forfeited.
Above Threshold-Level/Below Target Performance: For each Goal as to which performance is at or above threshold level but below target level, a number of Units that is equal to (i) one-third of the Initial Number of Units times (ii) the percentage determined by straight-line interpolating between 50% and 100%, based on the relationship between actual performance, threshold-level performance, and target-level performance for the applicable Goal, shall, subject to Section 3(c), vest as of November 15, 2020.
Target-Level Performance: For each Goal as to which target-level
performance is achieved, one-third of the Initial Number of Units shall, subject to Section 3(c), vest as of November 15, 2020.
Above Target-Level Performance: For each Goal as to which greater than target-level performance is achieved, a number of Units that is equal to (i) one-third of the Initial Number of Units times (ii) the percentage determined by straight-line interpolating between 100% and 200%, based on the relationship between actual performance, target-level performance, and outstanding-level performance for the applicable Goal (for this purpose, performance above the outstanding level for the applicable Goal shall be deemed to be performance at such outstanding level) shall, subject to Section 3(c), vest as of November 15, 2020.
(c) Effect
of Termination of Service. Subject to Section 5(c), if you incur a Termination of Service before November 15, 2020 as a result of a Job Elimination, your Retirement, or your Disability or death (each, a “Proration Event”), then effective as of November 15, 2020, a number of Units shall vest, equal to (i) the number of Units (if any) that vest based upon the application of paragraphs (a) and (b) above (and, if applicable, taking into account Section 5(b)), times (ii) a fraction (the “Proration Fraction”), the numerator of which is the number of days from September 1, 2017 through your date of termination, and the denominator of which is 1172 (subject to the special rule of Section 5(b)(v) that applies in the event that a Change of Control occurs following such Termination of Service). Except
as provided in Section 5(c), if you incur a Termination of Service before November 15, 2020 for any other reason, all Units subject to this Award Certificate shall be forfeited as of the date of such Termination of Service.
[(c) Effect of Termination of Service. Subject to Section 5(c), if after the Grant Date and prior to November 15, 2020, you incur: (i) a Termination of Service by reason of Retirement, death or Disability, or (ii) a Termination of Service without Cause on account of a Job Elimination or divestiture, this Award Certificate shall continue in effect without regard to the continued services requirement of the final sentence of this paragraph, the Units granted to you hereunder shall continue to
vest based on the degree of achievement of the performance goals set forth in Sections 3(a) and 3(b), and you shall be delivered Shares in accordance with Section 4 on the same terms that would have applied had you remained continuously employed through November 15, 2020. Except as provided in Section 5(c), if you incur a Termination of Service before November 15, 2020 for any reason other than those set forth in the preceding sentence, all Units subject to this Award Certificate shall be forfeited as of the date of such Termination of Service.]2
4. Delivery of Shares or Other Settlement. The Company shall deliver to you a number of Shares equal to
the number of Units (if any) that vest pursuant to this Award Certificate (except that in the event of settlement following conversion of the Units into a cash account or award pursuant to Section 5(a) or Section 5(d), delivery shall be in cash), subject to withholding as provided in Section 6 below. Such delivery shall take place as soon as practicable, but in no event more than 15 days, after November 15, 2020. Notwithstanding the foregoing but subject to Section 6(b), with respect to a Termination of Service that is a “separation from service” within the meaning of Section 409A of the Code (“Separation from Service”) and that occurs during the two-year period following a Change of Control that qualifies as an event described in Section 409A(a)(2)(A)(v) of the Code and the regulations thereunder, such delivery shall take place as soon as practicable following the date of the applicable Termination of
Service. Nothing in this Agreement, including Section 5, shall preclude the Company from settling upon a Change of Control the Units that are not replaced by a Replacement Award, to the extent effectuated in accordance with Treas. Regs. § 1.409A-3(j)(ix).
______________________________
2 Continued vesting language included in Terms and Conditions of grant to Chairman and CEO and Chief Technology Officer
5. Change
of Control. The provisions of this Section 5 shall govern vesting of the Units upon a Change of Control.
(a) Upon the occurrence of a Change of Control, notwithstanding any other provision of this Award Certificate (but subject to Section 5(d)), the number of Units subject to this Award Certificate (determined in accordance with Section 5(b)) shall vest in full, except to the extent that you are granted a Replacement Award in respect of the Units. In the event that no Replacement Award is so provided to you, the Units shall be converted into a cash account (based on the number of Units as of the date of the Change of Control (determined in accordance with Section 5(b)) and the value per Share as of the Change of Control), which shall accrue interest at the applicable federal short-term rate provided for in Section 1274(d)(1)(A) of the Code, and be settled in accordance with Section 4 above. For
clarity, such account shall be fully vested as of the Change of Control, in no event shall the amount of such account be increased or decreased as a result of the circumstances of a subsequent Termination of Service, and the provisions of Section 2 relating to Dividend Equivalent Payments shall cease to apply following conversion of the Units into a cash account.
(b) For purposes of this Section 5, the number of Units subject to this Award Certificate as of a Change of Control shall be determined in accordance with the following rules:
(i) If the date of the Change of Control is after August 31, 2017 and prior to September 1, 2018, the number of Units subject to this Award Certificate as of such Change of Control shall be the Initial Number of Units.
(ii) If
the date of the Change of Control is after August 31, 2018 and prior to September 1, 2019, the number of Units subject to this Award Certificate as of such Change of Control shall be the sum of (x) 67% of the Initial Number of Units plus (y) 33% of the number of Units that would have become eligible for vesting under Section 3(b) above, if Goal achievement were measured solely based upon the degree of achievement of the fiscal year 2018 goals (assuming for this purpose that the Section 162(m) Performance Goal was achieved), the determination of such achievement to be made by the Committee no later than the date of the Change of Control, it being understood that to the extent that all necessary performance results are not available as of such date, the Committee shall make a good faith estimate.
(iii) If the date of the Change
of Control is after August 31, 2019 and prior to September 1, 2020, the number of Units subject to this Award Certificate as of such Change of Control shall be the sum of (x) 34% of the Initial Number of Units plus (y) 66% of the number of Units that would have become eligible for vesting under Section 3(b) above, if Goal achievement were measured solely based upon the degree of achievement of the fiscal year 2018 and the fiscal year 2019 goals (assuming for this purpose that the Section 162(m) Performance Goal was achieved), the determination of such achievement to be made by the Committee no later than the date of the Change of Control, it being understood that to the extent that all necessary performance results are not available as of such date, the Committee shall make a good faith estimate.
(iv) If the date of the Change
of Control is after August 31, 2020 and on or before November 30, 2020, the number of Units subject to this Award Certificate as of such Change of Control shall be determined pursuant to Section 3 based on actual performance (and the Committee shall make the applicable performance determinations no later than the date of the Change of Control, it being understood that to the extent that all necessary performance results are not available as of such date, the Committee shall make a good faith estimate).
(v) [Notwithstanding the foregoing provisions of this Section 5(b), if you have incurred a Termination of Service that is a Proration Event before the date of a Change of Control, the number of Units subject to this Award Certificate as of such Change of Control shall be determined by multiplying the number of Units determined
in accordance with the rules set forth in the preceding paragraphs of this Section 5(b) by the Proration Fraction.3]
(c) If you experience (x) a Termination without Cause, (y) a Termination of Service by reason of Retirement, death or Disability or (z) a termination under circumstances entitling you to severance benefits under a constructive termination provision (including, without limitation, a “good reason” provision or a constructive “involuntary termination” provision) of an agreement, plan or program covering you, in all cases, at any time following a Change of Control, the applicable Replacement Award shall vest in full.
______________________________
3
Section 5(b)(v) included in Terms and Conditions of grant to all members of the Executive Team and Operations Council other than the Chairman and CEO and Chief Technology Officer]
(d) Notwithstanding any other provision hereof or of the Plan, if the transactions contemplated by the Merger Agreement are consummated, each Unit shall be converted (with the number of Units to be so converted determined in accordance with Section 5(b)) into a cash-denominated award with an initial value per converted Unit equal to the Merger Consideration (as defined in the Merger Agreement), accruing interest from the Effective Time until the settlement date at the rate set forth in Section 5(a) and subject to the same provisions (including the provisions of Section 5(c) and the provisions
of Section 4) as would apply to a qualifying Replacement Award (other than those specific to an equity-based instrument).
6. Withholding; Section 409A.
(a) Notwithstanding any other provision of this Award Certificate, your right to receive the Dividend Equivalent Payment and to receive Shares in settlement of any Units is subject to withholding of all taxes that are required to be paid or withheld in connection with such Dividend Equivalent Payment or the delivery of such Shares. Unless the Committee determines otherwise, withholding of taxes in connection with the delivery of Shares in settlement of the Units shall be satisfied by withholding by the Company of that number of whole Shares having
a Fair Market Value on the date of withholding equal to the minimum amount required to be withheld. If you are subject to any taxes in connection with the Units or the Dividend Equivalent Payment in more than one jurisdiction, you acknowledge that the Company may be required to withhold or account for taxes in more than one jurisdiction.
(b) This Award Certificate is intended to comply with the requirements of Section 409A of the Code or an exemption or exclusion therefrom and, with respect to amounts that are subject to Section 409A of the Code, it is intended that this Award Certificate be administered in all respects in accordance with Section 409A of the Code. In no event may you, directly or indirectly, designate the calendar year of any payment to be made hereunder. Notwithstanding any provision of the Plan or this Award Certificate
to the contrary, in the event that you are a “specified employee” within the meaning of Section 409A of the Code (as determined in accordance with the methodology established by the Company), amounts that constitute “nonqualified deferred compensation” within the meaning of Section 409A of the Code that would otherwise be payable during the six-month period immediately following your Separation from Service, to the extent required by Section 409A of the Code, shall instead be paid or provided on the first business day after the date that is six months following your Separation from Service (but in no event later than the scheduled settlement date pursuant to Section 4). If you die following your Separation from Service and prior to the payment of any amounts delayed on account of Section 409A of the Code, such amounts shall be paid to the personal representative of your
estate or your beneficiary within 30 days after the date of your death.
7. Recoupment Policy. Notwithstanding any other provision of this Award Certificate, the Units shall be subject to the terms of the Company’s Recoupment Policy, which is hereby incorporated herein by reference.
8. No Right to Continued Employment or Service. This Award Certificate shall not limit or restrict the right of the Company or any Affiliate to terminate your employment or service at any time or for any reason.
9. Effect
of Award Certificate; Severability. This Award Certificate shall be binding upon and shall inure to the benefit of any successor of the Company. The invalidity or unenforceability of any provision of this Award Certificate shall not affect the validity or enforceability of any other provision of this Award Certificate.
10. Amendment. The terms and conditions of this Award Certificate may not be amended in any manner adverse to you without your consent.
11. Plan Interpretation. This Award Certificate is subject to the provisions of the Plan, and all of the provisions of the Plan are hereby incorporated into this Award Certificate. If there is a conflict between the provisions
of this Award Certificate and the Plan, the provisions of the Plan govern. If there is any ambiguity in this Award Certificate, any term that is not defined in this Award Certificate, or any matters as to which this Award Certificate is silent, the Plan shall govern, including, without limitation, the provisions of the Plan addressing construction and governing law, as well as the powers of the Committee, among others, to (a) interpret the Plan, (b) prescribe, amend and rescind rules and regulations relating to the Plan, (c) make appropriate adjustments to the Units in the event of a corporate transaction, and (d) make all other determinations necessary or advisable for the administration of the Plan.
12. Electronic Delivery. The Company may,
in its sole discretion, elect to deliver any documents related to the Units granted to you under the Plan by electronic means. You hereby consent to receive such documents by electronic delivery and agree to participate in the Plan through an on-line or electronic system established and maintained by the Company or a third party designated by the Company.
13. Governing Law. All questions concerning the construction, validity and interpretation of the Units and the Plan shall be governed and construed
according to the laws of the State of Delaware, without regard to the application of the conflicts of laws provisions thereof. Any disputes regarding the Units or the Plan shall be brought only in the state or federal courts of the State of Delaware.
Dates Referenced Herein and Documents Incorporated by Reference
