false000091591300009159132022-02-242022-02-24
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): February 24, 2022
_________________________________
ALBEMARLE CORPORATION
(Exact name of registrant as specified in charter)
_________________________________
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| Virginia | | 001-12658 | | 54-1692118 |
(State or other jurisdiction
of incorporation) | | (Commission
File Number) | | (IRS Employer
Identification No.) |
4250 Congress Street, Suite 900
Charlotte, North Carolina 28209
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (980) 299-5700
Not applicable
(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 obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐ 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))
Securities registered pursuant to Section 12(b) of the Act: | | | | | | | | | | | | | | |
| Title of each class | | Trading Symbol | | Name of each exchange on which registered |
| COMMON STOCK, $.01 Par Value | | ALB | | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR 240.12b-2) If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
(e) On February 24, 2022, the Executive Compensation Committee (the “Committee”) of the Board of Directors of Albemarle Corporation (the “Company”) adopted revised forms of Restricted Stock Unit Award Agreement, Adjusted ROIC Performance Unit Award Agreement, TSR Performance Unit Award Agreement, Stock Option Grant Agreement, and Special Restricted Stock Unit Award Agreement under the Company’s 2017 Incentive Plan. The forms of agreements are filed as exhibits to this Current Report on Form 8-K.
The awards granted to Ms. Karen G. Narwold, Executive Vice President, Chief Administrative Officer, General Counsel and Corporate Secretary, as part of her 2022 compensation package include special conditions upon a “Qualifying Termination Event.” Upon a Qualifying Termination Event (as defined in each of the respective award agreements) occurring after March 31, 2023, Ms. Narwold’s 2022 awards of Restricted Stock Units and Stock Options will become non-forfeitable. In addition, Ms. Narwold will remain eligible to earn in the full amount of her 2022 awards of Adjusted ROIC Performance Units and TSR Performance Units as of the time the Committee makes its determination as to what level of the performance goals associated with such awards have been met.
The awards granted to Mr. J. Kent Masters, Chairman, President and Chief Executive Officer, as part of his 2022 compensation package include certain special conditions. Mr. Masters’s 2022 awards of Restricted Stock Units and Stock Options granted in accordance with his Executive Employment Agreement, dated April 20, 2020 (“Employment Agreement”), shall be governed by Section 4(f) of his Employment Agreement and shall become non-forfeitable in accordance with such terms. Mr. Masters’s 2022 compensation includes incremental awards of Restricted Stock Units and Stock Options, which have been granted for merit, two-thirds of which will become non-forfeitable on December 31, 2023 and one-third of which will become non-forfeitable on December 31, 2024, provided in each case that Mr. Masters continues to be employed by the Company on such dates. In addition, Mr. Masters will remain eligible to earn Adjusted ROIC Performance Units and TSR Performance Units in the same proportions as his incremental merit awards, as of the time the Committee makes its determination as to what level of the performance goals associated with such awards have been met.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
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| Number | | Exhibit |
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| 104 | | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
# Management contract or compensatory plan or arrangement.
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.
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| | | ALBEMARLE CORPORATION |
| | | | |
| Date: | February 28, 2022 | | By: | /s/ Karen G. Narwold |
| | | | Karen G. Narwold |
| | | | Executive Vice President, Chief Administrative Officer and General Counsel |
RESTRICTED STOCK UNIT AWARD AGREEMENT
under the
ALBEMARLE CORPORATION 2017 INCENTIVE PLAN
As of the _____ day of _______________, 20___, Albemarle Corporation, a Virginia corporation (the “Company”), and «Name» (“Participant”), hereby agree to the terms of this “Award Agreement” which reflects the terms and provisions of the Award (as defined below) made pursuant to and subject to the provisions of the Company’s 2017 Incentive Plan (the “Plan”). All terms that are used herein that are defined in the Plan shall have the same meanings given them in the Plan.
Contingent Restricted Stock Units
1.Grant Date. Pursuant to the Plan, the Company, on the ____ day of ____________, 20___ (the “Grant Date”), granted Participant an incentive award (“Award”) in the form of «# of Units» Restricted Stock Units, subject to the terms and conditions of the Plan and subject to the terms and conditions set forth herein.
2.Value. The value of each Restricted Stock Unit on any date shall be equal to the value of one share of the Company’s Common Stock on such date; and the value of the Company’s Common Stock is the Fair Market Value of the Stock (as defined in the Plan) on the relevant date.
Vesting of Restricted Stock Units
3.Restrictions. Except as otherwise provided herein, the Restricted Stock Units shall remain nonvested, nontransferable and subject to a substantial risk of forfeiture as provided in paragraph 7.
4.Vesting. Subject to Participant’s continued employment with the Company (except as otherwise provided herein), Participant’s interest in the Restricted Stock Units shall become vested and non-forfeitable on the third anniversary of the Grant Date.
5.Vesting Upon a Qualifying Termination Event. Notwithstanding anything in this Notice of Award to the contrary, if, prior to the forfeiture of the Restricted Stock Units under paragraph 7, Participant experiences a Qualifying Termination Event (as defined in paragraph 8), Restricted Stock Units that are forfeitable shall become vested as to a pro-rata portion of the Award, as determined in accordance with the following sentence. The pro-rata portion of the Award that shall vest pursuant to the preceding sentence shall be equal to 1/36th of the Restricted Stock Units subject to the Award, for each full month of service performed by Participant after the Grant Date and prior to the Qualifying Termination Event, up to 36 months. The non-vested portion of the Award shall be forfeited.
6.Effects of a Change in Control. In the event of a Change in Control (as defined in the Plan) prior to the forfeiture of the Restricted Stock Units under paragraph 7, the provisions of this paragraph 6 shall apply in addition to the provisions of Article 17 (and related provisions) of the Plan.
(a)If, upon a Change in Control, a Participant receives a new award which qualifies as a Replacement Award (as defined below), the Replacement Award shall replace this Award and continue subject to the Replacement Award’s terms.
(i) A “Replacement Award” is an award that substitutes for this Award and meets the following requirements: (i) it has a value at least equal to the value of this
Award as determined under applicable law and by the Committee in its sole discretion; (ii) it relates to publicly traded equity securities of the Company or its successor in the Change in Control or another entity that is affiliated with the Company or its successor following the Change in Control; and (iii) its other terms and conditions are not less favorable to Participant than the terms and conditions of this Award (including the provisions that would apply in the event of a subsequent Change in Control). Without limiting the generality of the foregoing, the Replacement Award may take the form of a continuation of this Award if the requirements of the preceding sentence are satisfied. The determination of whether the conditions of a Replacement Award are satisfied shall be made by the Committee, as constituted immediately before the Change in Control, in its sole discretion. With respect to this Award, any Replacement Award made to Participant must provide that if Participant is either (1) terminated by the Company other than for Cause or (2) voluntarily resigns for Good Reason (as defined in paragraph 8) concurrent with or within two (2) years after the date of the Change in Control, the unvested Replacement Award shall become immediately vested and payable at the time of the termination or resignation. For purposes of paragraphs 6 and 8, references to the Company or an Affiliate shall also include any successor entity.
(b)If, following a Change in Control, the Company’s shares continue to be traded on the New York Stock Exchange or another established securities market, this Award shall continue in effect and be treated as a Replacement Award, provided, however, that if Participant is either (1) terminated by the Company other than for Cause or (2) voluntarily resigns for Good Reason, in either case, concurrent with or within two (2) years after the date of the Change in Control, the unvested Award shall become immediately vested and payable at the time of the termination or resignation.
(c)If, upon a Change in Control that results in the Company’s shares no longer being traded on the New York Stock Exchange or another established securities market and no Replacement Award is granted to Participant, the unvested portion of this Award shall become vested immediately prior to the consummation of the Change in Control.
(d)Notwithstanding the foregoing, upon a Change in Control, the Committee may determine that this Award shall be canceled and terminated for consideration in accordance with Article 17 of the Plan.
7.Forfeiture of Unvested Restricted Stock Units. Except as provided in paragraph 6 with respect to terminations of employment occurring within two (2) years after the date of a Change in Control, all Restricted Stock Units that are forfeitable shall be forfeited if Participant’s employment with the Company or an Affiliate terminates for any reason except a Qualifying Termination Event.
8.Definitions.
(a)For purposes of this Award, “Qualifying Termination Event” shall mean a Participant’s death, Disability, Retirement while in the employ of the Company or an Affiliate, or termination by the Company or an Affiliate other than for Cause.
(i)“Disability” shall mean a Participant’s permanent and total disability within the meaning of Section 22(e)(3) of the Code.
(ii)“Retirement” shall mean termination of employment after having attained age 55 and completed at least 10 years of service, or age 60 and completed at least 5 years of service with the Company or an Affiliate.
(b)“Good Reason” for purposes of paragraph 6 shall mean:
(i)a change in Participant’s position which in Participant’s reasonable judgment does not represent a promotion of Participant’s status or position immediately prior to the Change in Control or the assignment to Participant of any duties or responsibilities, or diminution of duties or responsibilities, which in Participant’s reasonable judgment are inconsistent with Participant’s position in effect immediately prior to the Change in Control;
(ii)a reduction by the Company in the annual rate of Participant’s base salary as in effect immediately prior to the date of a Change in Control;
(iii)the Company’s requiring Participant’s office nearest to Participant’s principal residence to be located at a different place which is more than thirty-five (35) miles from where such office is located immediately prior to a Change in Control;
(iv)the failure by the Company to continue in effect compensation or benefit plans in which Participant participates, which in the aggregate provide Participant compensation and benefits substantially equivalent to those prior to a Change in Control; or
(v)the failure of the Company to obtain a satisfactory agreement from any applicable successor entity to assume and agree to perform under any Severance Compensation Agreement.
In order for one of the foregoing events to constitute Good Reason, (i) Participant must notify the Company in writing no later than 90 days after the relevant event stating which Good Reason event has occurred, and (ii) the Company shall not have corrected the Good Reason event within thirty (30) days after Participant’s notice.
(c)If the events described in paragraph 6 or a Qualifying Termination Event occur after the date that Participant is advised that their employment is being, or will be, terminated for Cause, on account of performance or in circumstances that prevent them from being in good standing with the Company, accelerated vesting shall not occur and all rights under this Award shall terminate, and this Award shall expire on the date of Participant’s termination of employment. The Committee shall have the authority to determine whether Participant’s termination from employment is for Cause or for any reason other than Cause.
Payment of Awards
9.Time of Payment. Payment of Participant’s Restricted Stock Units shall be made as soon as practicable after the Units have vested, but in no event later than March 15th of the calendar year after the year in which the Units vest.
10.Form of Payment. The vested Restricted Stock Units shall be paid in whole shares of the Company’s Common Stock.
11.Death of Participant. If Participant dies prior to the payment of their non-forfeitable Restricted Stock Units, such Units shall be paid to their Beneficiary. Participant shall have the right to designate a Beneficiary in accordance with procedures established under the Plan for such purpose. If Participant fails to designate a Beneficiary, or if at the time of Participant’s death there is no surviving Beneficiary, any amounts payable will be paid to Participant’s estate.
12.Taxes. The Company will withhold from the Award the number of shares of Common Stock necessary to satisfy Federal tax-withholding requirements and state and local tax-withholding requirements with respect to the state and locality designated by Participant as their place of residence in the Company's system of record at the time the Award becomes taxable, except to the extent otherwise determined to be required by the Company, subject, however, to any special rules or provisions that may apply to Participants who are non-US employees (working inside or outside of the United States) or US employees working outside of the United States. It is Participant's responsibility to properly report all income and remit all Federal, state, and local taxes that may be due to the relevant taxing authorities as the result of receiving this Award.
General Provisions
13.Accounts. Restricted Stock Units granted to Participant shall be credited to an account (the “Account”) established and maintained for Participant. A Participant’s Account shall be the record of Restricted Stock Units granted to Participant under the Plan, is solely for accounting purposes and shall not require a segregation of any Company assets.
14.No Right to Continued Employment. Neither this Award nor the granting or vesting of Restricted Stock Units shall confer upon Participant any right with respect to continuance of employment by the Company or an Affiliate, nor shall it interfere in any way with the right of the Company or an Affiliate to terminate Participant’s employment at any time.
15.Change in Capital Structure. In accordance with the terms of the Plan, the terms of this Award shall be adjusted as the Committee determines is equitable in the event the Company effects one or more stock dividends, stock split-ups, subdivisions or consolidations of shares or other similar changes in capitalization.
16.Governing Law. This Award shall be governed by the laws of the Commonwealth of Virginia and applicable Federal law. All disputes arising under this Award shall be adjudicated solely within the state or Federal courts located within the Commonwealth of Virginia.
17.Participant Bound by Non-Compete Agreement. Participant acknowledges that they have signed the separate EMPLOYEE NON-SOLICITATION, NON-COMPETE AND CONFIDENTIALITY AGREEMENT (the “Non-Compete Agreement”) entered between them and the Company concurrently with entering into this Award Agreement. Participant further acknowledges and agrees that in the event of a breach of any of the terms of the Non-Compete Agreement on their part, before or after the vesting and/or payment of this Award, in addition to any and all consequences otherwise set forth in the Non-Compete Agreement, Participant shall immediately forfeit any and all rights under this Award, and to the extent any portion of the Award shall have already been paid to Participant, the Company shall have the right to recoup such Award in full.
18.Conflicts.
(a)In the event of any conflict between the provisions of the Plan as in effect on the Grant Date and the provisions of this Award, the provisions of the Plan shall govern. All references herein to the Plan shall mean the Plan as in effect on the Grant Date.
(b)In the event of any conflict between the provisions of this Award and the provisions of any separate Agreement between the Company and Participant, including, but not limited to, any Severance Compensation Agreement entered between Participant and the Company, the provisions of this Award shall govern.
19.Binding Effect. Subject to the limitations stated above and in the Plan, this Award shall be binding upon and inure to the benefit of the legatees, distributees, and personal representatives of Participant and the successors of the Company.
20.Recoupment. In addition to any other applicable provision of the Plan, this Award is subject to the terms of the separate Albemarle Corporation Recoupment Policy, as such Policy may be amended from time to time.
IN WITNESS WHEREOF, the Company and Participant have each caused this Award to be signed on their behalf, effective as of the date noted in the first paragraph of this Award Agreement.
ALBEMARLE CORPORATION
By: ______________________________
PARTICIPANT:
_______________________________
«Name»
ADJUSTED ROIC PERFORMANCE UNIT AWARD AGREEMENT
under the
ALBEMARLE CORPORATION 2017 INCENTIVE PLAN
As of the _____ day of _______________, 20___, Albemarle Corporation, a Virginia corporation (the “Company”), and «Name» (“Participant”), hereby agree to the terms of this “Award Agreement” which reflects the terms and provisions of the Award (as defined below) made pursuant to and subject to the provisions of the Company’s 2017 Incentive Plan (the “Plan”). All terms that are used herein that are defined in the Plan shall have the same meanings given them in the Plan.
Contingent Performance Units
1.Grant Date. Pursuant to the Plan, the Company, on the ____ day of ___________, 20___ (the “Grant Date”), granted Participant an incentive award (“Award”) in the form of «# of Units» Adjusted ROIC Performance Units (which number of Units is also referred to herein as the “Target Units”), subject to the terms and conditions of the Plan and subject to the terms and conditions set forth herein.
2.Value. The value of each Adjusted ROIC Performance Unit shall be equal to the value of one share of the Company’s Common Stock; and the value of the Company’s Common Stock is the Fair Market Value (as defined in the Plan) on the date any Adjusted ROIC Performance Units become vested and payable hereunder.
3.Definitions. Terms used in this Award Notice shall have the following meanings:
(a)“Measurement Period” means the 20__, 20__ and 20__ calendar period.
(b)“Adjusted ROIC” (Return on Invested Capital) shall be calculated for each calendar year during the Measurement Period and is determined as the amount derived pursuant to the following quotient:
Annual Adjusted ROIC =
EBT (Earnings Before Taxes + Depreciation/Amortization – CAPEX Maintenance)
Average Gross Investment (Gross PP&E (Property, Plant and Equipment) +
Working Capital – CIP (Major Construction in Progress) not generating revenue)
Exclude long cycle maintenance capital from CAPEX Maintenance in the numerator.
For projects with less than 6 months revenue in a year: Exclude the profit from EBT, while excluding construction in progress from the denominator.
(c)“3-Year Adjusted ROIC” means the Company’s annual Adjusted ROIC averaged for the Measurement Period.
Adjustments. Notwithstanding anything in this Notice of Award to the contrary, in accordance with the Plan and as approved by the Committee, Adjusted ROIC and its component values may be adjusted to reflect nonrecurring, unanticipated or other specifically identifiable amounts that may be unknown as of the Grant Date, including, without limitation, acquisitions and divestitures, write-down or write off of intangible assets (goodwill), restructuring and realignment charges, changes in accounting or tax legislation, foreign currency translation changes, gain/loss on debt retirements, and non-GAAP adjustments or special charges.
4.Performance Criteria. Except as otherwise provided herein, Participant’s Adjusted ROIC Performance Units shall be earned on the Award Date (defined in paragraph 5) in a percentage determined by the performance level for the 3-Year Adjusted ROIC achieved during the Measurement Period, as set forth on Exhibit A. The performance criteria set forth on Exhibit A may be adjusted by the Committee in its sole and absolute discretion to reflect any extraordinary or significant events that affect Adjusted ROIC.
Earning and Vesting of Adjusted ROIC Performance Units
5.Earned Awards. As soon as practicable after the end of the Measurement Period, a determination shall be made by the Committee of the number of whole Adjusted ROIC Performance Units that Participant has earned. The date as of which the Committee determines the number of Adjusted ROIC Performance Units earned shall be the “Award Date.”
6.Vesting of Earned Awards. Participant’s interest in the earned Adjusted ROIC Performance Units shall become vested and non-forfeitable on the Award Date and will be paid as soon as practicable thereafter.
7.Earning/Vesting on Qualifying Termination Event.
(a)During the Measurement Period. Notwithstanding anything in this Notice of Award to the contrary, if a Participant separates from service prior to the end of the Measurement Period on account of a Qualifying Termination Event (as defined in paragraph 10(a)), then a pro-rata number (as determined in accordance with the following sentence) of Participant’s Adjusted ROIC Performance Units shall be earned under paragraph 5 above as of the Award Date, based on the actual level of achievement of the performance criteria set forth on Exhibit A, and any remaining Adjusted ROIC Performance Units shall be forfeited. The pro-rata number of Adjusted ROIC Performance Units earned pursuant to the preceding sentence shall be equal to 1/36th of the Units granted, for each full month of service performed by Participant during the Measurement Period. The number of Adjusted ROIC Performance Units earned shall be determined by the Committee in its sole and absolute discretion within the limits provided in the Plan and the earned Adjusted ROIC Performance Units shall be fully vested as of the Award Date, and payable pursuant to paragraphs 11-13 hereof.
(b)After the Measurement Period. Notwithstanding anything in this Notice of Award to the contrary, if after the Measurement Period ends, but prior to the Award Date, Participant experiences a Qualifying Termination Event, such Participant shall earn their Adjusted ROIC Performance Units pursuant to paragraph 5 and such earned Units shall be fully vested as of the Award Date and payable pursuant to paragraphs 11-13 hereof.
8.Effects of a Change in Control. The provisions of this paragraph 8 shall apply in the event of a Change in Control (as defined in the Plan) prior to the forfeiture of the Adjusted ROIC Performance Units under paragraph 9.
(a)Subject to subparagraph (b) hereof, upon a Change in Control during the Measurement Period, a pro-rata number of Adjusted ROIC Performance Units equal to 1/36th of the Units granted, for each full month of service performed by Participant during the Measurement Period, will be earned based on the higher of actual performance as of the date of the Change in Control or the target performance level for 3-Year Adjusted ROIC set forth on Exhibit A. The number of Adjusted ROIC Performance Units earned shall be determined by the Committee (as it exists immediately prior to the Change in Control) in its sole and absolute discretion within the limits provided in the Plan, and the earned Adjusted ROIC Performance Units
shall be vested and paid pursuant to paragraphs 11-13 hereof, no later than March 15th of the calendar year after the year in which the Change in Control occurs.
(b)Notwithstanding the provisions of subparagraph (a) hereof, if, following the Change in Control, the Company’s shares continue to be traded on the New York Stock Exchange or another established securities market, subparagraph (a) of this paragraph shall not apply, and this Award shall remain in effect and continue subject to the remaining terms of this Notice of Award; provided, however, if Participant is terminated by the Company other than for Cause or voluntarily resigns for Good Reason (as defined paragraph 10(b)) concurrent with or within two (2) years after the date of the Change in Control and during the Measurement Period, a pro-rata number of Adjusted ROIC Performance Units equal to 1/36th of the Units granted, for each full month of service performed by Participant during the Measurement Period, will be earned and paid (no later than March 15th of the calendar year after the year in which the termination or resignation occurs) based on the higher of actual performance as of the date of the termination of employment or the target performance level for 3-Year Adjusted ROIC set forth on Exhibit A. If Participant is terminated by the Company other than for Cause or voluntarily resigns for Good Reason after the Measurement Period but before the Award is fully vested, the earned Adjusted ROIC Performance Units will become immediately vested and payable pursuant to paragraphs 11-13 hereof no later than March 15th of the calendar year after the year in which the termination or resignation occurs.
9.Forfeiture. Except as provided in paragraph 8 hereof, all Adjusted ROIC Performance Units that are forfeitable shall be forfeited if Participant’s employment with the Company or an Affiliate terminates for any reason except a Qualifying Termination Event.
10.Definitions.
(a)For purposes of this Award, “Qualifying Termination Event” shall mean a Participant’s death, Disability, Retirement while in the employ of the Company or an Affiliate, or termination by the Company or an Affiliate other than for Cause.
(i)“Disability” shall mean a Participant’s permanent and total disability within the meaning of Section 22(e)(3) of the Code.
(ii)“Retirement” shall mean termination of employment after having attained age 55 and completed at least 10 years of service, or age 60 and completed at least 5 years of service with the Company or an Affiliate.
(b)For purposes of paragraph 8, “Good Reason” shall mean:
(i)a change in Participant’s position which in Participant’s reasonable judgment does not represent a promotion of Participant’s status or position immediately prior to the Change in Control or the assignment to Participant of any duties or responsibilities, or diminution of duties or responsibilities, which in Participant’s reasonable judgment are inconsistent with Participant’s position in effect immediately prior to the Change in Control;
(ii)a reduction by the Company in the annual rate of Participant’s base salary as in effect immediately prior to the date of a Change in Control;
(iii)the Company’s requiring Participant’s office nearest to Participant’s principal residence to be located at a different place which is more than thirty-five (35) miles from where such office is located immediately prior to a Change in Control;
(iv)the failure by the Company to continue in effect compensation or benefit plans in which Participant participates, which in the aggregate provide Participant compensation and benefits substantially equivalent to those prior to a Change in Control; or
(v)the failure of the Company to obtain a satisfactory agreement from any applicable successor entity to assume and agree to perform under any Severance Compensation Agreement.
In order for one of the foregoing events to constitute Good Reason, (i) Participant must notify the Company in writing no later than 90 days after the relevant event stating which Good Reason event has occurred, and (ii) the Company shall not have corrected the Good Reason event within thirty (30) days after Participant’s notice.
(c)If the events described in paragraph 8 or a Qualifying Termination Event occur after the date that Participant is advised that their employment is being, or will be, terminated for Cause, on account of performance or in circumstances that prevent them from being in good standing with the Company, accelerated vesting shall not occur and all rights under this Award shall terminate, and this Award shall expire on the date of Participant’s termination of employment. The Committee shall have the authority to determine whether Participant’s termination from employment is for Cause or for any reason other than Cause.
Payment of Awards
11.Time of Payment. Payment of Participant’s Adjusted ROIC Performance Units shall be made as soon as practicable after the Units have become non-forfeitable (or the Award Date, if later), but in no event later than March 15th of the calendar year after the year in which the Units become earned and non-forfeitable.
12.Form of Payment. The vested Adjusted ROIC Performance Units shall be paid in whole shares of the Company’s Common Stock.
13.Death of Participant. If Participant dies prior to the payment of their earned and vested Adjusted ROIC Performance Units, an amount equal to the amount of Participant’s non-forfeitable Adjusted ROIC Performance Units shall be paid to their Beneficiary. Participant shall have the right to designate a Beneficiary in accordance with procedures established under the Plan for such purpose. If Participant fails to designate a Beneficiary, or if at the time of Participant’s death there is no surviving Beneficiary, any amounts payable will be paid to Participant’s estate.
14.Taxes. The Company will withhold from the Award the number of shares of Common Stock necessary to satisfy Federal tax-withholding requirements and state and local tax-withholding requirements with respect to the state and locality designated by Participant as their place of residence in the Company's system of record at the time the Award becomes taxable, except to the extent otherwise determined to be required by the Company, subject, however, to any special rules or provisions that may apply to Participants who are non-US employees (working inside or outside of the United States) or US employees working outside of the United States. It is Participant's responsibility to properly report all income and remit all Federal, state, and local taxes that may be due to the relevant taxing authorities as the result of receiving this Award.
General Provisions
15.Accounts. Adjusted ROIC Performance Units granted to Participant shall be credited to an account (the “Account”) established and maintained for Participant. The Account of Participant shall be the record of Adjusted ROIC Performance Units granted to Participant
under the Plan, is solely for accounting purposes and shall not require a segregation of any Company assets.
16.No Right to Continued Employment. Neither this Award nor the granting, earning or vesting of Adjusted ROIC Performance Units shall confer upon Participant any right with respect to continuance of employment by the Company or an Affiliate, nor shall it interfere in any way with the right of the Company or an Affiliate to terminate Participant’s employment at any time.
17.Change in Capital Structure. In accordance with the terms of the Plan, the terms of this Award shall be adjusted as the Committee determines is equitable in the event the Company effects one or more stock dividends, stock split-ups, subdivisions or consolidations of shares or other similar changes in capitalization.
18.Governing Law. This Award shall be governed by the laws of the Commonwealth of Virginia and applicable Federal law. All disputes arising under this Award shall be adjudicated solely within the state or Federal courts located within the Commonwealth of Virginia.
19.Participant Bound by Non-Compete Agreement. Participant acknowledges that they have signed the separate EMPLOYEE NON-SOLICITATION, NON-COMPETE AND CONFIDENTIALITY AGREEMENT (the “Non-Compete Agreement”) entered between them and the Company concurrently with entering into this Award Agreement. Participant further acknowledges and agrees that in the event of a breach of any of the terms of the Non-Compete Agreement on their part, before or after the earning, vesting and/or payment of this Award, in addition to any and all consequences otherwise set forth in the Non-Compete Agreement, Participant shall immediately forfeit any and all rights under this Award, and to the extent any portion of the Award shall have already been paid to Participant, the Company shall have the right to recoup such Award in full.
20.Conflicts.
(a)In the event of any conflict between the provisions of the Plan as in effect on the Grant Date and the provisions of this Award, the provisions of the Plan shall govern. All references herein to the Plan shall mean the Plan as in effect on the Grant Date.
(b)In the event of any conflict between the provisions of this Award and the provisions of any separate Agreement between the Company and Participant, including, but not limited to, any Severance Compensation Agreement entered between Participant and the Company, the provisions of this Award shall govern.
21.Binding Effect. Subject to the limitations stated above and in the Plan, this Award shall be binding upon and inure to the benefit of the legatees, distributees, and personal representatives of Participant and the successors of the Company.
22.Recoupment. In addition to any other applicable provision of the Plan, this Award is subject to the terms of the separate Albemarle Corporation Recoupment Policy, as such Policy may be amended from time to time.
IN WITNESS WHEREOF, the Company and Participant have each caused this Award to be signed on their behalf, effective as of the date noted in the first paragraph of this Award Agreement.
ALBEMARLE CORPORATION
By: ______________________________
PARTICIPANT:
_______________________________
«Name»
EXHIBIT A
Adjusted ROIC Performance Goals
| | | | | | | | |
| Performance Level | 3 -Year Adjusted ROIC Achieved in Measurement Period | Percentage of Target Units Earned* |
| Poor | Less than % | 0% |
| Threshold | % | 30% |
| Target | % | 100% |
| Superior | % | 200% |
* The percentage of Target Units earned for performance between the Threshold, Target and Superior Performance Levels will be determined by linear interpolation. No percentage of the Target Units will be earned for performance below the Threshold Performance Level. The number of Adjusted ROIC Performance Units earned hereunder shall be rounded to the nearest whole number.
TSR PERFORMANCE UNIT AWARD AGREEMENT
under the
ALBEMARLE CORPORATION 2017 INCENTIVE PLAN
As of the _____ day of _______________, 20___, Albemarle Corporation, a Virginia corporation (the “Company”), and «Name» (“Participant”), hereby agree to the terms of this “Award Agreement” which reflects the terms and provisions of the Award (as defined below) made pursuant to and subject to the provisions of the Company’s 2017 Incentive Plan (the “Plan”). All terms that are used herein that are defined in the Plan shall have the same meanings given them in the Plan.
Contingent Performance Units
1.Grant Date. Pursuant to the Plan, the Company, on the ____ day of ____________, 20___ (the “Grant Date”), granted Participant an incentive award (“Award”) in the form of «# of Units» TSR Performance Units (which number of Units is also referred to herein as the “Target Units”), subject to the terms and conditions of the Plan and subject to the terms and conditions set forth herein.
2.Value. The value of each TSR Performance Unit shall be equal to the value of one share of the Company’s Common Stock; and the value of the Company’s Common Stock is the Fair Market Value (as defined in the Plan) on the date any TSR Performance Units become vested and payable hereunder.
3.Definitions. Terms used in this Award Notice shall have the following meanings:
(a)“TSR” means “Total Shareholder Return.”
(b)“TSR %” is calculated using the following formula:
(Ending Stock Price + Reinvested Dividends) – Starting Stock Price
Starting Stock Price
(c)“Starting Stock Price” means the average closing price of the Company’s Common Stock over the 20-trading-day period commencing January 1, 20__.
(d)“Ending Stock Price” means the average closing price of the Company’s Common Stock over the 20-trading-day period ending December 31, 20__.
(e)“Reinvested Dividends” means the value of reinvested dividends paid on the Company’s Common Stock over the Measurement Period (as defined in paragraph 4).
(f)“TSR Relative to Peer Group” is the TSR % of the Company as compared to the TSR % of the Peer Group.
(g)“Peer Group” is the group of companies listed on Exhibit A. If a company in the Peer Group has its common stock delisted or if it no longer exists as a separate entity, the TSR % will be retroactively calculated for the remainder of the Performance Period without such company.
4.Performance Criteria. Participant’s TSR Performance Units shall be earned on the Award Date based on the following formula (to the nearest whole TSR Performance Unit). Such
TSR Performance Units shall be subject to the terms and conditions set forth in the following paragraphs of this Notice of Award.
(a) “Measurement Period” means the 20__, 20__ and 20__ calendar period.
(b)Earned Award = TSR % of Target Units x TSR Performance Units
(c)TSR % of Target Units. The TSR % of Target Units is determined according to the following table (awards to be interpolated between the TSR %s below):
| | | | | | | | |
| TSR Relative to Peer Group | | TSR % of Target Units |
75th percentile or higher | | 200% of Target Units |
50th percentile | | 100% of Target Units |
30th percentile | | 30% of Target Units |
less than 30th percentile | | 0% |
(d)The Company shall retain discretion to decrease Awards but may not increase any Awards, directly or indirectly, hereunder.
(e)For purposes of this Award, the number of earned TSR Performance Units will be rounded to the nearest whole number.
(f)Notwithstanding anything herein to the contrary, if the Company’s TSR for the Measurement Period is negative, no more than 100% of the TSR Performance Units may be earned and become vested and non-forfeitable hereunder.
Earning and Vesting of TSR Performance Units
5.Earned Awards. As soon as practicable after the end of the Measurement Period, a determination shall be made by the Committee of the number of whole TSR Performance Units that Participant has earned. The date as of which the Committee determines the number of TSR Performance Units earned shall be the “Award Date.”
6.Vesting of Earned Awards. Participant’s interest in the earned TSR Performance Units shall become vested and non-forfeitable on the Award Date and will be paid as soon as practicable thereafter.
7.Earning/Vesting on Qualifying Termination Event.
(a)During the Measurement Period. Notwithstanding anything in this Notice of Award to the contrary, if a Participant separates from service prior to the end of the Measurement Period on account of a Qualifying Termination Event (as defined in paragraph 10(a)), then a pro-rata number (as determined in accordance with the following sentence) of Participant’s TSR Performance Units shall be earned under paragraph 5 above as of the Award Date, based on the actual level of achievement of the performance criteria set forth in paragraph 4 above, and any remaining TSR Performance Units shall be forfeited. The pro-rata number of TSR Performance Units earned pursuant to the preceding sentence shall be equal to 1/36th of the Units granted, for each full month of service performed by Participant during the Measurement Period. The number of TSR Performance Units earned shall be determined by the Committee in its sole and absolute discretion within the limits provided in the Plan and the earned TSR Performance Units shall be fully vested as of the Award Date, and payable pursuant to paragraphs 11-13 hereof.
(b)After the Measurement Period. Notwithstanding anything in this Notice of Award to the contrary, if after the Measurement Period ends, but prior to the Award Date, Participant experiences a Qualifying Termination Event, such Participant shall earn their TSR Performance Units pursuant to paragraph 5 and such earned Units shall be fully vested as of the Award Date and payable pursuant to paragraphs 11-13 hereof.
8.Effects of a Change in Control. The provisions of this paragraph 8 shall apply in the event of a Change in Control (as defined in the Plan) prior to the forfeiture of the TSR Performance Units under paragraph 9.
(a)Subject to subparagraph (b) hereof, upon a Change in Control during the Measurement Period, a pro-rata number of TSR Performance Units equal to 1/36th of the Units granted, for each full month of service performed by Participant during the Measurement Period, will be earned based on the higher of actual performance as of the date of the Change in Control or achievement of a TSR Relative to Peer Group at the 50th percentile as described in paragraph 4(c). The number of TSR Performance Units earned shall be determined by the Committee (as it exists immediately prior to the Change in Control) in its sole and absolute discretion within the limits provided in the Plan, and the earned TSR Performance Units shall be vested and paid pursuant to paragraph 11 hereof, no later than March 15th of the calendar year after the year in which the Change in Control occurs.
(b)Notwithstanding the provisions of subparagraph (a) hereof, if, following the Change in Control, the Company’s shares continue to be traded on the New York Stock Exchange or another established securities market, subparagraph (a) of this paragraph shall not apply, and this Award shall remain in effect and continue subject to the remaining terms of this Notice of Award; provided, however, if Participant is terminated by the Company other than for Cause or voluntarily resigns for Good Reason (as defined in paragraph 10(b)) concurrent with or within two (2) years after the date of the Change in Control and during the Measurement Period, a pro-rata number of TSR Performance Units equal to 1/36th of the Units granted, for each full month of service performed by Participant during the Measurement Period, will be earned and paid (no later than March 15th of the calendar year after the year in which the termination or resignation occurs) based on the higher of actual performance as of the date of the termination of employment or achievement of a TSR Relative to Peer Group at the 50th percentile as described in paragraph 4(c). If Participant is terminated by the Company other than for Cause or voluntarily resigns for Good Reason after the Measurement Period but before the Award is fully vested, the earned unvested TSR Performance Units will become immediately vested and payable pursuant to paragraph 11 hereof no later than March 15th of the calendar year after the year in which the termination or resignation occurs.
9.Forfeiture. Except as provided in paragraph 8 hereof, all TSR Performance Units that are forfeitable shall be forfeited if Participant’s employment with the Company or an Affiliate terminates for any reason except a Qualifying Termination Event.
10.Definitions.
(a)For purposes of this Award, “Qualifying Termination Event” shall mean a Participant’s death, Disability, Retirement while in the employ of the Company or an Affiliate, or termination by the Company or an Affiliate other than for Cause.
(i)“Disability” shall mean a Participant’s permanent and total disability within the meaning of Section 22(e)(3) of the Code.
(ii)“Retirement” shall mean termination of employment after having attained age 55 and completed at least 10 years of service, or age 60 and completed at least 5 years of service with the Company or an Affiliate.
(b)For purposes of paragraph 8, “Good Reason” shall mean:
(i)a change in Participant’s position which in Participant’s reasonable judgment does not represent a promotion of Participant’s status or position immediately prior to the Change in Control or the assignment to Participant of any duties or responsibilities, or diminution of duties or responsibilities, which in Participant’s reasonable judgment are inconsistent with Participant’s position in effect immediately prior to the Change in Control;
(ii)a reduction by the Company in the annual rate of Participant’s base salary as in effect immediately prior to the date of a Change in Control;
(iii)the Company’s requiring Participant’s office nearest to Participant’s principal residence to be located at a different place which is more than thirty-five (35) miles from where such office is located immediately prior to a Change in Control;
(iv)the failure by the Company to continue in effect compensation or benefit plans in which Participant participates, which in the aggregate provide Participant compensation and benefits substantially equivalent to those prior to a Change in Control; or
(v)the failure of the Company to obtain a satisfactory agreement from any applicable successor entity to assume and agree to perform under any Severance Compensation Agreement.
In order for one of the foregoing events to constitute Good Reason, (i) Participant must notify the Company in writing no later than 90 days after the relevant event stating which Good Reason event has occurred, and (ii) the Company shall not have corrected the Good Reason event within thirty (30) days after Participant’s notice.
(c)If the events described in paragraph 8 or a Qualifying Termination Event occur after the date that Participant is advised that their employment is being, or will be, terminated for Cause, on account of performance or in circumstances that prevent them from being in good standing with the Company, accelerated vesting shall not occur and all rights under this Award shall terminate, and this Award shall expire on the date of Participant’s termination of employment. The Committee shall have the authority to determine whether Participant’s termination from employment is for Cause or for any reason other than Cause.
Payment of Awards
11.Time of Payment. Payment of Participant’s TSR Performance Units shall be made as soon as practicable after the Units have become non-forfeitable (or the Award Date, if later), but in no event later than March 15th of the calendar year after the year in which the Units become earned and non-forfeitable.
12.Form of Payment. The vested TSR Performance Units shall be paid in whole shares of the Company’s Common Stock.
13.Death of Participant. If Participant dies prior to the payment of their earned and vested TSR Performance Units, an amount equal to the amount of Participant’s non-forfeitable TSR Performance Units shall be paid to their Beneficiary. Participant shall have the right to
designate a Beneficiary in accordance with procedures established under the Plan for such purpose. If Participant fails to designate a Beneficiary, or if at the time of Participant’s death there is no surviving Beneficiary, any amounts payable will be paid to Participant’s estate.
14.Taxes. The Company will withhold from the Award the number of shares of Common Stock necessary to satisfy Federal tax-withholding requirements and state and local tax-withholding requirements with respect to the state and locality designated by Participant as their place of residence in the Company's system of record at the time the Award becomes taxable, except to the extent otherwise determined to be required by the Company, subject, however, to any special rules or provisions that may apply to Participants who are non-US employees (working inside or outside of the United States) or US employees working outside of the United States. It is Participant's responsibility to properly report all income and remit all Federal, state, and local taxes that may be due to the relevant taxing authorities as the result of receiving this Award.
General Provisions
15.Accounts. TSR Performance Units granted to Participant shall be credited to an account (the “Account”) established and maintained for Participant. The Account of Participant shall be the record of TSR Performance Units granted to Participant under the Plan, is solely for accounting purposes and shall not require a segregation of any Company assets.
16.No Right to Continued Employment. Neither this Award nor the granting, earning or vesting of TSR Performance Units shall confer upon Participant any right with respect to continuance of employment by the Company or an Affiliate, nor shall it interfere in any way with the right of the Company or an Affiliate to terminate Participant’s employment at any time.
17.Change in Capital Structure. In accordance with the terms of the Plan, the terms of this Award shall be adjusted as the Committee determines is equitable in the event the Company effects one or more stock dividends, stock split-ups, subdivisions or consolidations of shares or other similar changes in capitalization.
18.Governing Law. This Award shall be governed by the laws of the Commonwealth of Virginia and applicable Federal law. All disputes arising under this Award shall be adjudicated solely within the state or Federal courts located within the Commonwealth of Virginia.
19.Participant Bound by Non-Compete Agreement. Participant acknowledges that they have signed the separate EMPLOYEE NON-SOLICITATION, NON-COMPETE AND CONFIDENTIALITY AGREEMENT (the “Non-Compete Agreement”) entered between them and the Company concurrently with entering into this Award Agreement. Participant further acknowledges and agrees that in the event of a breach of any of the terms of the Non-Compete Agreement on their part, before or after the earning, vesting and/or payment of this Award, in addition to any and all consequences otherwise set forth in the Non-Compete Agreement, Participant shall immediately forfeit any and all rights under this Award, and to the extent any portion of the Award shall have already been paid to Participant, the Company shall have the right to recoup such Award in full.
20.Conflicts.
(a)In the event of any conflict between the provisions of the Plan as in effect on the Grant Date and the provisions of this Award, the provisions of the Plan shall govern. All references herein to the Plan shall mean the Plan as in effect on the Grant Date.
(b)In the event of any conflict between the provisions of this Award and the provisions of any separate Agreement between the Company and Participant, including, but not
limited to, any Severance Compensation Agreement entered between Participant and the Company, the provisions of this Award shall govern.
21.Binding Effect. Subject to the limitations stated above and in the Plan, this Award shall be binding upon and inure to the benefit of the legatees, distributees, and personal representatives of Participant and the successors of the Company.
22.Recoupment. In addition to any other applicable provision of the Plan, this Award is subject to the terms of the separate Albemarle Corporation Recoupment Policy, as such Policy may be amended from time to time.
IN WITNESS WHEREOF, the Company and Participant have each caused this Award to be signed on their behalf, effective as of the date noted in the first paragraph of this Award Agreement.
ALBEMARLE CORPORATION
By: ______________________________
PARTICIPANT:
_______________________________
«Name»
EXHIBIT A
Peer Group for Award
The Peer Group for the 20__ Performance Unit based relative TSR Award will include the following Companies:
STOCK OPTION GRANT AGREEMENT
under the
ALBEMARLE CORPORATION 2017 INCENTIVE PLAN
No. of shares subject to option: «Stock_Options»
As of the _____ day of _______________, 20___, Albemarle Corporation, a Virginia corporation (the “Company”), and «Name» (“Participant”), hereby agree to the terms of this “Award Agreement” which reflects the terms and provisions of the Option (as defined below) made pursuant to and subject to the provisions of the Company’s 2017 Incentive Plan (the “Plan”). All terms that are used herein that are defined in the Plan shall have the same meanings given them in the Plan.
1.Grant of Option. Pursuant to the Plan, the Company, on the ____ day of ________, 20___ (the “Grant Date”), granted to Participant, subject to the terms and conditions of the Plan and subject further to the terms and conditions herein set forth, the right and option to purchase from the Company all or any part of the aggregate of «# of Shares» shares of Common Stock at the option price of «$ Price» per share (the “Option Price”) (this grant referred to herein as the “Option” or the “Award”), being not less than the Fair Market Value per share of the Common Stock on the Grant Date of the Option. Such Option will be exercisable as hereinafter provided. This Option is not intended to be treated as an incentive stock option under Section 422 of the Code.
2.Expiration Date. The Expiration Date of this Option is the date that is ten (10) years from the Grant Date. This Option may not be exercised on or after the Expiration Date.
3.Vesting and Exercisability of Option.
(a)Vesting. Except as provided in paragraphs 4, 5, or 6, this Option shall become vested and exercisable on the third anniversary of the Grant Date subject to Participant’s continued employment with the Company.
(b)Exercisability. Once the Option has become exercisable hereunder, it shall continue to be exercisable until the termination of Participant’s rights hereunder pursuant to paragraphs 4, 5, or 6, or until the Expiration Date, if earlier. A partial exercise of this Option shall not affect Participant’s right to exercise this Option with respect to the remaining shares, subject to the terms and conditions of the Plan and those set forth herein.
(c)Method of Exercising and Payment for Shares. This Option shall be exercised through a licensed brokerage firm at Participant’s expense, in conjunction with established procedures and coordinated with the Company’s Human Resources and Law Departments. From time to time the procedures for exercising this Option may be subject to modification by the aforesaid departments, but in no case shall the number of shares subject to the Option or its terms for vesting be changed by the procedures for exercise or by the modification thereof. Procedures for the exercise of this Option will be provided to Participant by the Company’s Human Resources Department.
4.Effects of a Qualifying Termination Event.
(a)Vesting on Qualifying Termination Event. Notwithstanding anything in this Option to the contrary, if, prior to the forfeiture of the Option under paragraph 5(b),
Participant experiences a Qualifying Termination Event (as defined in paragraph 7(a)), the Option shall become vested as to a pro-rata portion of the Option, as determined in accordance with the following sentence. The pro-rata portion of the Option that shall vest pursuant to the preceding sentence shall be equal to 1/36th of the shares subject to the Option, for each full month of service performed by Participant after the Grant Date and prior to the Qualifying Termination Event. The non-vested portion of the Option shall be forfeited.
(b)Exercisability following Qualifying Termination Event. The vested portion of the Option may be exercised beginning on the third anniversary of the Grant Date and shall remain exercisable according to the terms provided in paragraph 3(b), and Participant or Participant’s beneficiary (or estate as the case may be) may exercise this Option during the remainder of the period preceding the Expiration Date. Participant shall have the right to designate their beneficiary in accordance with procedures established under the Plan for such purpose. If Participant fails to designate a beneficiary, or if at the time of their death there is no surviving beneficiary, this Option may be exercised by Participant’s estate.
5.Effects of Other Terminations of Employment.
(a)Exercisability of Vested Option. Except as provided in paragraphs 4 or 6, in the event Participant ceases to be employed by the Company or an Affiliate, the rules under this paragraph 5 shall apply. If Participant ceases to be employed after the Option has vested in accordance with paragraph 3, but prior to the Expiration Date, Participant may exercise this Option with respect to the shares Participant is entitled to purchase pursuant to paragraph 3 within sixty (60) days of the date of such termination of employment (but in no event later than the Expiration Date). Any portion of the vested Option that is not exercised within the foregoing sixty (60) day period shall be immediately forfeited.
(b)Forfeiture of Non-Vested Option. Any non-vested portion of the Option that does not become vested pursuant to paragraph 3, 4 or 6, shall be forfeited if Participant’s employment with the Company or an Affiliate terminates for any reason.
6.Effects of a Change in Control. In the event of a Change in Control (as defined in the Plan) prior to the forfeiture of the Option under paragraph 5(b), the provisions of this paragraph 6 shall apply in addition to the provisions of Article 17 (and related provisions) of the Plan.
(a)If, upon a Change in Control, a Participant receives a new award which qualifies as a Replacement Award (as defined below), the Replacement Award shall replace this Award and continue subject to the Replacement Award’s terms.
(i)A “Replacement Award” is an award that substitutes for this Award and meets the following requirements: (i) it has a value at least equal to the value of this Award as determined under applicable law and by the Committee in its sole discretion; (ii) it relates to publicly traded equity securities of the Company or its successor in the Change in Control or another entity that is affiliated with the Company or its successor following the Change in Control; and (iii) its other terms and conditions are not less favorable to Participant than the terms and conditions of this Award (including the provisions that would apply in the event of a subsequent Change in Control). Without limiting the generality of the foregoing, the Replacement Award may take the form of a continuation of this Award if the requirements of the preceding sentence are satisfied. The determination of whether the conditions of a Replacement Award are satisfied shall be made by the Committee, as constituted immediately before the Change in Control, in its sole discretion. With respect to this Award, any Replacement Award made to Participant must provide that
if Participant is either (1) terminated by the Company other than for Cause or (2) voluntarily resigns for Good Reason (as defined in paragraph 7) concurrent with or within two (2) years after the date of the Change in Control, the unvested Replacement Award shall become immediately vested and exercisable at the time of the termination or resignation. For purposes of paragraphs 6 and 7, references to the Company or an Affiliate shall also include any successor entity.
(b)If, following a Change in Control, the Company’s shares continue to be traded on the New York Stock Exchange or another established securities market, this Award shall continue in effect and be treated as a Replacement Award, provided, however, that if Participant is either (1) terminated by the Company other than for Cause or (2) voluntarily resigns for Good Reason, in either case, concurrent with or within two (2) years after the date of the Change in Control, the unvested Award shall become immediately vested and exercisable at the time of the termination or resignation and shall remain so until the Expiration Date.
(c)If, upon a Change in Control that results in the Company’s shares no longer being traded on the New York Stock Exchange or another established securities market and no Replacement Award is granted to Participant, the unvested portion of this Award shall become vested and exercisable immediately prior to the consummation of the Change in Control.
(d)Notwithstanding the foregoing, upon a Change in Control, the Committee may determine that this Award shall be canceled and terminated for consideration in accordance with Article 17 of the Plan.
7.Definitions.
(a)“Qualifying Termination Event” shall mean a Participant’s death, Disability, Retirement while in the employ of the Company or an Affiliate, or termination by the Company or an Affiliate other than for Cause.
(i)“Disability” shall mean a Participant’s permanent and total disability within the meaning of Section 22(e)(3) of the Code.
(ii)“Retirement” shall mean termination of employment after having attained age 55 and completed at least 10 years of service, or age 60 and completed at least 5 years of service with the Company or an Affiliate.
(b)“Good Reason” for purposes of paragraph 6 shall mean:
(i)a change in Participant’s position which in Participant’s reasonable judgment does not represent a promotion of Participant’s status or position immediately prior to the Change in Control or the assignment to Participant of any duties or responsibilities, or diminution of duties or responsibilities, which in Participant’s reasonable judgment are inconsistent with Participant’s position in effect immediately prior to the Change in Control;
(ii)a reduction by the Company in the annual rate of Participant’s base salary as in effect immediately prior to the date of a Change in Control;
(iii)the Company’s requiring Participant’s office nearest to Participant’s principal residence to be located at a different place which is more than thirty-five (35) miles from where such office is located immediately prior to a Change in Control;
(iv)the failure by the Company to continue in effect compensation or benefit plans in which Participant participates, which in the aggregate provide Participant compensation and benefits substantially equivalent to those prior to a Change in Control; or
(v)the failure of the Company to obtain a satisfactory agreement from any applicable successor entity to assume and agree to perform under any Severance Compensation Agreement.
In order for one of the foregoing events to constitute Good Reason, (i) Participant must notify the Company in writing no later than 90 days after the relevant event stating which Good Reason event has occurred, and (ii) the Company shall not have corrected the Good Reason event within thirty (30) days after Participant’s notice.
(c)If the events described in paragraphs 6 or 7(a) occur after the date that Participant is advised that their employment is being, or will be, terminated for Cause, on account of performance or in circumstances that prevent them from being in good standing with the Company, accelerated vesting shall not occur and all rights under this Option shall terminate, and this Option shall expire on the date of Participant’s termination of employment. The Committee shall have the authority to determine whether Participant’s termination from employment is for Cause or for any reason other than Cause.
8.Nontransferability. This Option is nontransferable except by will or the laws of descent and distribution. During Participant’s lifetime, this Option may be exercised only by Participant.
9.Fractional Shares. Fractional shares shall not be issuable hereunder, and when any provision hereof may entitle Participant to a fractional share such fraction shall be disregarded.
10.No Right to Continued Employment. This Option does not confer upon Participant any right with respect to continuance of employment by the Company or an Affiliate, nor shall it interfere in any way with the right of the Company or an Affiliate to terminate Participant’s employment at any time.
11.Change in Capital Structure. The terms of this Option shall be adjusted as the Committee determines is equitable in the event the Company effects one or more stock dividends, stock split-ups, subdivisions or consolidations of shares or other similar changes in capitalization.
12.Governing Law. This Option shall be governed by the laws of the Commonwealth of Virginia and applicable Federal law. All disputes arising under this Option shall be adjudicated solely within the state or Federal courts located within the Commonwealth of Virginia.
13.Participant Bound by Non-Compete Agreement. Participant acknowledges that they have signed the separate EMPLOYEE NON-SOLICITATION, NON-COMPETE AND CONFIDENTIALITY AGREEMENT (the “Non-Compete Agreement”) entered between them and the Company concurrently with entering into this Award Agreement. Participant further acknowledges and agrees that in the event of a breach of any of the terms of the Non-Compete Agreement on their part, before or after the vesting and/or exercise of this Option, in addition to any and all consequences otherwise set forth in the Non-Compete Agreement, Participant shall immediately forfeit any and all rights under this Award, and to the extent any portion of the Award shall have already been paid to Participant, the Company shall have the right to recoup such Award in full.
14.Conflicts.
(a)In the event of any conflict between the provisions of the Plan as in effect on the date hereof and the provisions of this Option, the provisions of the Plan shall govern. All references herein to the Plan shall mean the Plan as in effect on the date hereof.
(b)In the event of any conflict between the provisions of this Option and the provisions of any separate Agreement between the Company and Participant, including, but not limited to, any Severance Compensation Agreement, the provisions of this Option shall govern.
15.Binding Effect. Subject to the limitations set forth herein and in the Plan, this Option shall be binding upon and inure to the benefit of the legatees, distributees, and personal representatives of Participant and the successors of the Company.
16.Taxes. Tax withholding requirements attributable to the exercise of this Option, including employment taxes, Federal income taxes, and state and local income taxes with respect to the state and locality where, according to the Company's system of records, Participant resides at the time the Option is exercised, except as otherwise might be determined to be required by the Company, will be satisfied by Participant as instructed in the established procedures for exercising this Option; provided, however, that the foregoing employment, Federal, state and local income tax withholding provision shall be subject to any special rules or provisions that may apply to Participants who are non-US employees (working inside or outside of the United States) or US employees working outside of the United States. It is Participant's responsibility to properly report all income and remit all Federal, state, and local taxes that may be due to the relevant taxing authorities as the result of exercising this Option.
17.Recoupment. In addition to any other applicable provision of the Plan, this Option is subject to the terms of the separate Albemarle Corporation Recoupment Policy, as such Policy may be amended from time to time.
IN WITNESS WHEREOF, the Company and Participant have each caused this Award to be signed on their behalf, effective as of the date noted in the first paragraph of this Award Agreement.
ALBEMARLE CORPORATION
By: _____________________________
PARTICIPANT:
_______________________________
«Name»
Exhibit 10.5
Special Retention RSU Grant
RESTRICTED STOCK UNIT AWARD AGREEMENT
under the
ALBEMARLE CORPORATION 2017 INCENTIVE PLAN
As of the _____ day of _______________, 20___, Albemarle Corporation, a Virginia corporation (the “Company”), and «Name» (“Participant”), hereby agree to the terms of this “Award Agreement” which reflects the terms and provisions of the Award (as defined below) made pursuant to and subject to the provisions of the Company’s 2017 Incentive Plan (the “Plan”). All terms that are used herein that are defined in the Plan shall have the same meanings given them in the Plan.
Contingent Restricted Stock Unit
1.Grant Date. Pursuant to the Plan, the Company, on the ____ day of ____________, 20___ (the “Grant Date”), granted Participant an incentive award (“Award”) in the form of «# of Units» Restricted Stock Units, subject to the terms and conditions of the Plan and subject to the terms and conditions set forth herein.
2.Value. The value of each Restricted Stock Unit on any date shall be equal to the value of one share of the Company’s Common Stock on such date; and the value of the Company’s Common Stock is the Fair Market Value of the Stock (as defined in the Plan) on the relevant date.
Vesting of Restricted Stock Units
3.Restrictions. Except as otherwise provided herein, the Restricted Stock Units shall remain nonvested, nontransferable and subject to a substantial risk of forfeiture as provided in paragraph 7.
4.Vesting. Subject to Participant’s continued employment with the Company (except as otherwise provided herein), Participant’s interest in the Restricted Stock Units shall become vested and non-forfeitable on the third anniversary of the Grant Date.
5.Vesting Upon a Qualifying Termination Event. Notwithstanding anything in this Notice of Award to the contrary, if, prior to the forfeiture of the Restricted Stock Units under paragraph 7, Participant experiences a Qualifying Termination Event (as defined in paragraph 8), Restricted Stock Units that are forfeitable shall become vested as to a pro-rata portion of the Award, as determined in accordance with the following sentence. The pro-rata portion of the Award that shall vest pursuant to the preceding sentence shall be equal to 1/36th of the Restricted Stock Units subject to the Award, for each full month of service performed by Participant after the Grant Date and prior to the Qualifying Termination Event, up to 36 months. The non-vested portion of the Award shall be forfeited.
6.Effects of a Change in Control. In the event of a Change in Control (as defined in the Plan) prior to the forfeiture of the Restricted Stock Units under paragraph 7, the provisions of this paragraph 6 shall apply in addition to the provisions of Article 17 (and related provisions) of the Plan.
(a)If, upon a Change in Control, a Participant receives a new award which qualifies as a Replacement Award (as defined below), the Replacement Award shall replace this Award and continue subject to the Replacement Award’s terms.
(i) A “Replacement Award” is an award that substitutes for this Award and meets the following requirements: (i) it has a value at least equal to the value of this Award as determined under applicable law and by the Committee in its sole discretion; (ii) it relates to publicly traded equity securities of the Company or its successor in the Change in Control or another entity that is affiliated with the Company or its successor following the Change in Control; and (iii) its other terms and conditions are not less favorable to Participant than the terms and conditions of this Award (including the provisions that would apply in the event of a subsequent Change in Control). Without limiting the generality of the foregoing, the Replacement Award may take the form of a continuation of this Award if the requirements of the preceding sentence are satisfied. The determination of whether the conditions of a Replacement Award are satisfied shall be made by the Committee, as constituted immediately before the Change in Control, in its sole discretion. With respect to this Award, any Replacement Award made to Participant must provide that if Participant is either (1) terminated by the Company other than for Cause or (2) voluntarily resigns for Good Reason (as defined in paragraph 8) concurrent with or within two (2) years after the date of the Change in Control, the unvested Replacement Award shall become immediately vested and payable at the time of the termination or resignation. For purposes of paragraphs 6 and 8, references to the Company or an Affiliate shall also include any successor entity.
(b)If, following a Change in Control, the Company’s shares continue to be traded on the New York Stock Exchange or another established securities market, this Award shall continue in effect and be treated as a Replacement Award, provided, however, that if Participant is either (1) terminated by the Company other than for Cause or (2) voluntarily resigns for Good Reason, in either case, concurrent with or within two (2) years after the date of the Change in Control, the unvested Award shall become immediately vested and payable at the time of the termination or resignation.
(c)If, upon a Change in Control that results in the Company’s shares no longer being traded on the New York Stock Exchange or another established securities market and no Replacement Award is granted to Participant, the unvested portion of this Award shall become vested immediately prior to the consummation of the Change in Control.
(d)Notwithstanding the foregoing, upon a Change in Control, the Committee may determine that this Award shall be canceled and terminated for consideration in accordance with Article 17 of the Plan.
7.Forfeiture of Unvested Restricted Stock Units. Except as provided in paragraph 6 with respect to terminations of employment occurring within two (2) years after the date of a Change in Control, all Restricted Stock Units that are forfeitable shall be forfeited if Participant’s employment with the Company or an Affiliate terminates for any reason except a Qualifying Termination Event.
8.Definitions.
(a)For purposes of this Award, “Qualifying Termination Event” shall mean a Participant’s death, Disability, or termination by the Company or an Affiliate other than for Cause.
(i)“Disability” shall mean a Participant’s permanent and total disability within the meaning of Section 22(e)(3) of the Code.
(b)“Good Reason” for purposes of paragraph 6 shall mean:
(i)a change in Participant’s position which in Participant’s reasonable judgment does not represent a promotion of Participant’s status or position immediately prior to the Change in Control or the assignment to Participant of any duties or responsibilities, or diminution of duties or responsibilities, which in Participant’s reasonable judgment are inconsistent with Participant’s position in effect immediately prior to the Change in Control;
(ii)a reduction by the Company in the annual rate of Participant’s base salary as in effect immediately prior to the date of a Change in Control;
(iii)the Company’s requiring Participant’s office nearest to Participant’s principal residence to be located at a different place which is more than thirty-five (35) miles from where such office is located immediately prior to a Change in Control;
(iv)the failure by the Company to continue in effect compensation or benefit plans in which Participant participates, which in the aggregate provide Participant compensation and benefits substantially equivalent to those prior to a Change in Control; or
(v)the failure of the Company to obtain a satisfactory agreement from any applicable successor entity to assume and agree to perform under any Severance Compensation Agreement.
In order for one of the foregoing events to constitute Good Reason, (i) Participant must notify the Company in writing no later than 90 days after the relevant event stating which Good Reason event has occurred, and (ii) the Company shall not have corrected the Good Reason event within thirty (30) days after Participant’s notice.
(c)If the events described in paragraph 6 or a Qualifying Termination Event occur after the date that Participant is advised that their employment is being, or will be, terminated for Cause, on account of performance or in circumstances that prevent them from being in good standing with the Company, accelerated vesting shall not occur and all rights under this Award shall terminate, and this Award shall expire on the date of Participant’s termination of employment. The Committee shall have the authority to determine whether Participant’s termination from employment is for Cause or for any reason other than Cause.
Payment of Awards
9.Time of Payment. Payment of Participant’s Restricted Stock Units shall be made as soon as practicable after the Units have vested, but in no event later than March 15th of the calendar year after the year in which the Units vest.
10.Form of Payment. The vested Restricted Stock Units shall be paid in whole shares of the Company’s Common Stock.
11.Death of Participant. If Participant dies prior to the payment of their non-forfeitable Restricted Stock Units, such Units shall be paid to their Beneficiary. Participant shall have the right to designate a Beneficiary in accordance with procedures established under the Plan for such purpose. If Participant fails to designate a Beneficiary, or if at the time of Participant’s death there is no surviving Beneficiary, any amounts payable will be paid to Participant’s estate.
12.Taxes. The Company will withhold from the Award the number of shares of Common Stock necessary to satisfy Federal tax-withholding requirements and state and local tax-withholding requirements with respect to the state and locality designated by Participant as their place of residence in the Company's system of record at the time the Award becomes taxable, except to the extent otherwise determined to be required by the Company, subject, however, to any special rules or provisions that may apply to Participants who are non-US employees (working inside or outside of the United States) or US employees working outside of the United States. It is Participant's responsibility to properly report all income and remit all Federal, state, and local taxes that may be due to the relevant taxing authorities as the result of receiving this Award.
General Provisions
13.Accounts. Restricted Stock Units granted to Participant shall be credited to an account (the “Account”) established and maintained for Participant. A Participant’s Account shall be the record of Restricted Stock Units granted to Participant under the Plan, is solely for accounting purposes and shall not require a segregation of any Company assets.
14.No Right to Continued Employment. Neither this Award nor the granting or vesting of Restricted Stock Units shall confer upon Participant any right with respect to continuance of employment by the Company or an Affiliate, nor shall it interfere in any way with the right of the Company or an Affiliate to terminate Participant’s employment at any time.
15.Change in Capital Structure. In accordance with the terms of the Plan, the terms of this Award shall be adjusted as the Committee determines is equitable in the event the Company effects one or more stock dividends, stock split-ups, subdivisions or consolidations of shares or other similar changes in capitalization.
16.Governing Law. This Award shall be governed by the laws of the Commonwealth of Virginia and applicable Federal law. All disputes arising under this Award shall be adjudicated solely within the state or Federal courts located within the Commonwealth of Virginia.
17.Participant Bound by Non-Compete Agreement. Participant acknowledges that they have signed the separate EMPLOYEE NON-SOLICITATION, NON-COMPETE AND CONFIDENTIALITY AGREEMENT (the “Non-Compete Agreement”) entered between them and the Company concurrently with entering into this Award Agreement. Participant further acknowledges and agrees that in the event of a breach of any of the terms of the Non-Compete Agreement on their part, before or after the vesting and/or payment of this Award, in addition to any and all consequences otherwise set forth in the Non-Compete Agreement, Participant shall immediately forfeit any and all rights under this Award, and to the extent any portion of the Award shall have already been paid to Participant, the Company shall have the right to recoup such Award in full.
18.Conflicts.
(a)In the event of any conflict between the provisions of the Plan as in effect on the Grant Date and the provisions of this Award, the provisions of the Plan shall govern. All references herein to the Plan shall mean the Plan as in effect on the Grant Date.
(b)In the event of any conflict between the provisions of this Award and the provisions of any separate Agreement between the Company and Participant, including, but not limited to, any Severance Compensation Agreement entered between Participant and the Company, the provisions of this Award shall govern.
19.Binding Effect. Subject to the limitations stated above and in the Plan, this Award shall be binding upon and inure to the benefit of the legatees, distributees, and personal representatives of Participant and the successors of the Company.
20.Recoupment. In addition to any other applicable provision of the Plan, this Award is subject to the terms of the separate Albemarle Corporation Recoupment Policy, as such Policy may be amended from time to time.
IN WITNESS WHEREOF, the Company and Participant have each caused this Award to be signed on their behalf, effective as of the date noted in the first paragraph of this Award Agreement.
ALBEMARLE CORPORATION
By: ______________________________
PARTICIPANT:
_______________________________
«Name»