Common use of Misconduct and Repayment upon Restatement Clause in Contracts

Misconduct and Repayment upon Restatement. (a) In the event the Committee determines in its sole discretion that the Optionee has (i) used for profit or disclosed to unauthorized persons, confidential information or trade secrets of the Company, (ii) breached any contract with or violated any fiduciary obligation to the Company, or (iii) engaged in any conduct which is injurious to the Company including diverting employees of the Company to leave the Company without the Company's prior consent, then YUM! may terminate all of the Optionee's outstanding Option Award and the Optionee shall forfeit all rights to any unexercised Option Award granted hereunder. (b) The Committee may cancel, rescind, suspend, withhold or otherwise limit or restrict the Option Award if there is a material restatement of the Company's financial statements that is completely or partially caused by misconduct by an executive officer of the Company, and the Optionee would unfairly profit if the cancellation, rescission, suspension, withholding, or limitation did not occur, as determined by the Committee; provided that the Committee's notification of the rescission is made no later than one year after the restated financial statements are issued. (c) If there is a material restatement of the Company's financial statements that is completely or partially caused by misconduct by an executive officer of the Company, any exercise of the Option Award occurring within 12 months after the restated year (or other restated period) may be rescinded by the Committee, if the Committee concludes that the repayment is necessary to prevent the Optionee from unfairly benefiting from an exercise following the restatement, provided that the rescission under this Section (c) shall be effective only if all of the following apply: (1) The Committee notifies the Optionee of the rescission no later than one year after the restated financial statements are issued, and (2) The Committee reasonably determines that, prior to the time the Option was exercised, such Optionee both (i) knew or should have known of the inaccuracy of the financial statements that were restated, and (ii) knew or should have known that the inaccuracy was caused by misconduct. In the event of any such rescission, the Optionee (regardless of whether then employed) shall pay to the Company the amount of any gain realized as a result of the rescinded exercise (determined as of the time of exercise), in such manner and on such terms and conditions as may be required by the Company, provided that the Company shall be entitled to set-off against the amount of any such gain any amount owed to the Optionee by the Company. (d) If the Optionee is an executive officer of the Company, and there is a material restatement of the Company's financial statements and such material restatement was caused by the Optionee's misconduct, the Committee shall cancel the Optionee's Option Award (to the extent permitted under applicable law). Further, any exercise of the Option occurring within 12 months after the restated year (or other restated period) shall be rescinded by the Committee (to the extent permitted under applicable law), provided that the rescission shall be effective only if the Committee notifies the Optionee of the rescission no later than one year after the restated financial statements are issued. In the event of any such rescission, the Optionee (regardless of whether then employed) shall pay to the Company the amount of any gain realized as a result of the rescinded exercise (determined as of the time of exercise), in such manner and on such terms and conditions as may be required by the Company, provided that the Company shall be entitled to set-off against the amount of any such gain any amount owed to the Optionee by the Company. (e) This Agreement is a voluntary agreement, and each Optionee who has accepted the Agreement has chosen to do so voluntarily. The Optionee understands that all Options provided under the Agreement and all amounts paid to the Optionee under the Agreement are provided as an advance that is contingent on the Company's financial statements not being subject to a material restatement. As a condition of the Agreement, the Optionee specifically agrees that the Committee may cancel, rescind, suspend, withhold or otherwise limit or restrict the Option Award for any individual party to such an agreement due to a material restatement of the Company's financial statements, as provided in this Section 5 including all subsections (a) through (g). In the event that amounts have been paid to an individual pursuant to the Agreement and the Committee determines that the individual must repay an amount to the Company as a result of the Committee's cancellation, rescission, suspension, withholding or other limitation or restriction of rights, the Optionee agrees, as a condition of being awarded such rights, to make such repayments. (f) The Board may reduce the amount to be recouped under the foregoing provisions of this Section 5 based on such factors as the Board determines in its sole discretion to be relevant. Such factors may include, without limitation, the extent to which the gain is determined to be attributable to events prior to the restated year (or other period), and whether the Optionee continued to hold the Stock acquired upon the exercise of the Option during a period in which the value of the Stock declined. (g) For purpose of this Section 5, (i) the term “misconduct” means fraudulent or illegal conduct or omission that is knowing or intentional; (ii) no conduct or omission shall be deemed “knowing” by a Optionee unless done, or omitted to be done, by the Optionee not in good faith and without reasonable belief that the Optionee's action or omission was in the best interest of the Company; and (iii) a buy out of the Option Award in accordance with Section 11 shall be treated as the exercise of the Option. Sections (b) through (f) above shall apply only to Awards granted after December 31, 2008.

Misconduct and Repayment upon Restatement. (a) In the event the Committee determines in its sole discretion that the Optionee Participant has (i) used for profit or disclosed to unauthorized persons, confidential information or trade secrets of the Company, (ii) breached any contract with or violated any fiduciary obligation to the Company, or (iii) engaged in any conduct which is injurious to the Company including diverting employees of the Company to leave the Company without the Company's prior consent, then YUM! may terminate all of the OptioneeParticipant's outstanding Option Award YUM! Stock Appreciation Rights and the Optionee Participant shall forfeit all rights to any unexercised Option Award YUM! Stock Appreciation Rights granted hereunder. . (b) The b)The Committee may cancel, rescind, suspend, withhold or otherwise limit or restrict the Option Award YUM! Stock Appreciation Rights if there is a material restatement of the Company's financial statements that is completely or partially caused by misconduct by an executive officer of the Company, and the Optionee Participant would unfairly profit if the cancellation, rescission, suspension, withholding, or limitation did not occur, as determined by the Committee; provided that the Committee's notification of the rescission is made no later than one year after the restated financial statements are issued. (c) If there is a material restatement of the Company's financial statements that is completely or partially caused by misconduct by an executive officer of the Company, any exercise of the Option Award Stock Appreciation Right occurring within 12 months after the restated year (or other restated period) may be rescinded by the Committee, if the Committee concludes that the repayment is necessary to prevent the Optionee Participant from unfairly benefiting from an exercise following the restatement, provided that the rescission under this Section (cd) shall be effective only if all of the following apply: (1) The Committee notifies the Optionee Participant of the rescission no later than one year after the restated financial statements are issued, and (2) The Committee reasonably determines that, prior to the time the Option YUM! Stock Appreciation Right was exercised, such Optionee Participant both (i) knew or should have known of the inaccuracy of the financial statements that were restated, and (ii) knew or should have known that the inaccuracy was caused by misconduct. (d) If the Optionee is an executive officer of the Company, and there is a material restatement of the Company's financial statements and such material restatement was caused by the Optionee's misconduct, the Committee shall cancel the Participant's YUM! Stock Appreciation Right Award (to the extent permitted under applicable law). Further, any exercise of the YUM! Stock Appreciation Right occurring within 12 months after the restated year (or other restated period) shall be rescinded by the Committee (to the extent permitted under applicable law), provided that the rescission shall be effective only if the Committee notifies the Participant of the rescission no later than one year after the restated financial statements are issued. In the event of any such rescission, the Optionee Participant (regardless of whether then employed) shall pay to the Company the amount of any gain realized as a result of the rescinded exercise (determined as of the time of exercise), in such manner and on such terms and conditions as may be required by the Company, provided that the Company shall be entitled to set-off against the amount of any such gain any amount owed to the Optionee by the Company. (d) If the Optionee is an executive officer of the Company, and there is a material restatement of the Company's financial statements and such material restatement was caused by the Optionee's misconduct, the Committee shall cancel the Optionee's Option Award (to the extent permitted under applicable law). Further, any exercise of the Option occurring within 12 months after the restated year (or other restated period) shall be rescinded by the Committee (to the extent permitted under applicable law), provided that the rescission shall be effective only if the Committee notifies the Optionee of the rescission no later than one year after the restated financial statements are issued. In the event of any such rescission, the Optionee (regardless of whether then employed) shall pay to the Company the amount of any gain realized as a result of the rescinded exercise (determined as of the time of exercise), in such manner and on such terms and conditions as may be required by the Company, provided that the Company shall be entitled to set-off against the amount of any such gain any amount owed to the Optionee Participant by the Company. (e) This Agreement is a voluntary agreement, and each Optionee Participant who has accepted the Agreement has chosen to do so voluntarily. The Optionee Participant understands that all Options YUM! Stock Appreciation Rights provided under the Agreement and all amounts paid to the Optionee individual under the Agreement are provided as an advance that is contingent on the Company's financial statements not being subject to a material restatement. As a condition of the Agreement, the Optionee Participant specifically agrees that the Committee may cancel, rescind, suspend, withhold or otherwise limit or restrict the Option Award YUM! Stock Appreciation Rights for any individual party to such an agreement due to a material restatement of the Company's financial statements, as provided in this Section 5 including all subsections subsections (a) through (gf). In the event that amounts have been paid to an individual the Participant pursuant to the Agreement and the Committee determines that the individual Participant must repay an amount to the Company as a result of the Committee's cancellation, rescission, suspension, withholding or other limitation or restriction of rights, the Optionee Participant agrees, as a condition of being awarded such rights, to make such repayments. (f) The Board may reduce the amount to be recouped under the foregoing provisions of this Section 5 based on such factors as the Board determines in its sole discretion to be relevant. Such factors may include, without limitation, the extent to which the gain is determined to be attributable to events prior to the restated year (or other period), and whether the Optionee Participant continued to hold the Stock acquired upon the exercise of the Option YUM! Stock Appreciation Rights during a period in which the value of the Stock declined. (g) For purpose of this Section 5, (i) the term “misconduct” means fraudulent or illegal conduct or omission that is knowing or intentional; (ii) no conduct or omission shall be deemed “knowing” by a Optionee Participant unless done, or omitted to be done, by the Optionee Participant not in good faith and without reasonable belief that the OptioneeParticipant's action or omission was in the best interest of the Company; and (iii) a buy out of the Option Award YUM! Stock Appreciation Right in accordance with Section 11 shall be treated as the exercise of the OptionStock Appreciation Right. Sections (b) through (fe) above shall apply only to Awards granted after December 31, 2008.

Misconduct and Repayment upon Restatement. (a) In the event the Committee determines in its sole discretion that the Optionee Participant has (i) used for profit or disclosed to unauthorized persons, confidential information or trade secrets of the Company, (ii) breached any contract with or violated any fiduciary obligation to the Company, or (iii) engaged in any conduct which is injurious to the Company including diverting employees of the Company to leave the Company without the Company's prior consent, then YUM! may terminate all of the OptioneeParticipant's outstanding Option Award YUM! Stock Appreciation Rights and the Optionee Participant shall forfeit all rights to any unexercised Option Award YUM! Stock Appreciation Rights granted hereunder. (b) The Committee may cancel, rescind, suspend, withhold or otherwise limit or restrict the Option Award YUM! Stock Appreciation Rights if there is a material restatement of the Company's financial statements that is completely or partially caused by misconduct by an executive officer of the Company, and the Optionee Participant would unfairly profit if the cancellation, rescission, suspension, withholding, or limitation did not occur, as determined by the Committee; provided that the Committee's notification of the rescission is made no later than one year after the restated financial statements are issued. (c) If there is a material restatement of the Company's financial statements that is completely or partially caused by misconduct by an executive officer of the Company, any exercise of the Option Award Stock Appreciation Right occurring within 12 months after the restated year (or other restated period) may be rescinded by the Committee, if the Committee concludes that the repayment is necessary to prevent the Optionee Participant from unfairly benefiting from an exercise following the restatement, provided that the rescission under this Section (cd) shall be effective only if all of the following apply: (1) The Committee notifies the Optionee Participant of the rescission no later than one year after the restated financial statements are issued, and (2) The Committee reasonably determines that, prior to the time the Option YUM! Stock Appreciation Right was exercised, such Optionee Participant both (i) knew or should have known of the inaccuracy of the financial statements that were restated, and (ii) knew or should have known that the inaccuracy was caused by misconduct. In the event of any such rescission, the Optionee Participant (regardless of whether then employed) shall pay to the Company the amount of any gain realized as a result of the rescinded exercise (determined as of the time of exercise), in such manner and on such terms and conditions as may be required by the Company, provided that the Company shall be entitled to set-off against the amount of any such gain any amount owed to the Optionee by the Company. (d) If the Optionee is an executive officer of the Company, and there is a material restatement of the Company's financial statements and such material restatement was caused by the Optionee's misconduct, the Committee shall cancel the Optionee's Option Award (to the extent permitted under applicable law). Further, any exercise of the Option occurring within 12 months after the restated year (or other restated period) shall be rescinded by the Committee (to the extent permitted under applicable law), provided that the rescission shall be effective only if the Committee notifies the Optionee of the rescission no later than one year after the restated financial statements are issued. In the event of any such rescission, the Optionee (regardless of whether then employed) shall pay to the Company the amount of any gain realized as a result of the rescinded exercise (determined as of the time of exercise), in such manner and on such terms and conditions as may be required by the Company, provided that the Company shall be entitled to set-off against the amount of any such gain any amount owed to the Optionee by the Company. (e) This Agreement is a voluntary agreement, and each Optionee who has accepted the Agreement has chosen to do so voluntarily. The Optionee understands that all Options provided under the Agreement and all amounts paid to the Optionee under the Agreement are provided as an advance that is contingent on the Company's financial statements not being subject to a material restatement. As a condition of the Agreement, the Optionee specifically agrees that the Committee may cancel, rescind, suspend, withhold or otherwise limit or restrict the Option Award for any individual party to such an agreement due to a material restatement of the Company's financial statements, as provided in this Section 5 including all subsections (a) through (g). In the event that amounts have been paid to an individual pursuant to the Agreement and the Committee determines that the individual must repay an amount to the Company as a result of the Committee's cancellation, rescission, suspension, withholding or other limitation or restriction of rights, the Optionee agrees, as a condition of being awarded such rights, to make such repayments. (f) The Board may reduce the amount to be recouped under the foregoing provisions of this Section 5 based on such factors as the Board determines in its sole discretion to be relevant. Such factors may include, without limitation, the extent to which the gain is determined to be attributable to events prior to the restated year (or other period), and whether the Optionee continued to hold the Stock acquired upon the exercise of the Option during a period in which the value of the Stock declined. (g) For purpose of this Section 5, (i) the term “misconduct” means fraudulent or illegal conduct or omission that is knowing or intentional; (ii) no conduct or omission shall be deemed “knowing” by a Optionee unless done, or omitted to be done, by the Optionee not in good faith and without reasonable belief that the Optionee's action or omission was in the best interest of the Company; and (iii) a buy out of the Option Award in accordance with Section 11 shall be treated as the exercise of the Option. Sections (b) through (f) above shall apply only to Awards granted after December 31, 2008.,

Misconduct and Repayment upon Restatement. (a) In the event the Committee determines in its sole discretion that the Optionee Participant has (i) used for profit breached this Agreement or disclosed to unauthorized persons, confidential information or trade secrets of the Company, (ii) breached any other contract with or violated any fiduciary obligation to the Company, or (iiiii) engaged in any conduct which is injurious to the Company including diverting employees of the Company to leave the Company without the Company's prior consent, then YUM! the Committee may terminate cancel all of the OptioneeParticipant's outstanding Option Award and the Optionee shall forfeit all rights to any unexercised Option Award granted hereunderYRSUs (whether vested or unvested). (b) The Committee shall cancel all of the Participant’s outstanding YRSUs (whether vested or unvested) if there is a material restatement of the Company’s financial statements for any fiscal year (or other fiscal period) ending after the Grant Date and the restatement was caused by the Participant’s misconduct. The Committee may cancel, rescind, suspend, withhold or otherwise limit or restrict all of the Option Award Participant’s outstanding YRSUs (whether vested or unvested) if there is a material restatement of the Company's ’s financial statements for any fiscal year (or other fiscal period) ending after the Grant Date that is completely or partially caused by misconduct by an executive officer of the Company, and the Optionee Participant would unfairly profit if the cancellation, rescission, suspension, withholding, or limitation did not occur, as determined by the Committee; provided that the Committee's ’s notification of the rescission or other such action is made no later than one year after the restated financial statements are issued. (c) If there is a material restatement of the Company's ’s financial statements for any fiscal year (or other fiscal period) ending after the Grant Date and the restatement was caused by the Participant’s misconduct, and shares of Stock have been delivered to the Participant pursuant to this Agreement, then the Committee shall rescind such shares (and all securities received as a dividend or distribution on such shares), provided that the rescission shall be effective only if the Committee notifies the Participant of the rescission no later than one year after the restated financial statements are issued. In the event of any such rescission, the Participant shall either (x) promptly return to YUM! all such shares (and all such securities), such return to be effected by means of duly endorsed stock certificates and such other actions and documents as YUM! may reasonably request (in which case such shares (and such securities) shall cease to be outstanding), without any payment to the Participant therefor or (y) promptly pay to YUM! an amount equal to (A) the number of such shares (appropriately adjusted for any stock split or stock dividend) times (B) the closing price of the Stock on the New York Stock Exchange on the business day preceding the date of payment (plus an amount equal to the number of such securities times the then current market price thereof). The Company shall be entitled to set-off against the amount due from the Participant any amount owed to the Participant by the Company. (d) If there is a material restatement of the Company’s financial statements for any fiscal year (or other fiscal period) ending after the Grant Date that is completely or partially caused by misconduct by an executive officer of the Company, and shares of Stock have been delivered to the Participant pursuant to this Agreement, then the Committee may rescind any exercise of the Option Award occurring within 12 months after the restated year such shares (and all securities received as a dividend or other restated period) may be rescinded by the Committeedistribution on such shares), if the Committee concludes that the repayment rescission is necessary to prevent the Optionee Participant from unfairly benefiting from an exercise following issuance of the restatementshares, provided that the rescission under this Section subparagraph (cd) shall be effective only if all of the following apply: (1) The Committee notifies the Optionee Participant of the rescission no later than one year after the restated financial statements are issued, and. (2) The Committee reasonably determines that, prior to the time such shares were issued to the Option was exercisedParticipant, such Optionee the Participant both (i) knew or should have known of the inaccuracy of the financial statements that were restated, and (ii) knew or should have known that the inaccuracy was caused by misconduct. In the event of any such rescission, the Optionee Participant shall either (regardless x) promptly return to YUM! all such shares (and all such securities), such return to be effected by means of whether then employedduly endorsed stock certificates and such other actions and documents as YUM! may reasonably request (in which case such shares (and such securities) shall cease to be outstanding), without any payment to the Participant therefor or (y) promptly pay to YUM! an amount equal to (A) the Company number of such shares (appropriately adjusted for any stock split or stock dividend) times (B) the amount of any gain realized as a result closing price of the rescinded exercise Stock on the New York Stock Exchange on the business day preceding the date of payment (determined as plus an amount equal to the number of such securities times the time of exercisethen current market price thereof), in such manner and on such terms and conditions as may be required by the Company, provided that the . The Company shall be entitled to set-off against the amount of any such gain due from the Participant any amount owed to the Optionee by the Company. (d) If the Optionee is an executive officer of the Company, and there is a material restatement of the Company's financial statements and such material restatement was caused by the Optionee's misconduct, the Committee shall cancel the Optionee's Option Award (to the extent permitted under applicable law). Further, any exercise of the Option occurring within 12 months after the restated year (or other restated period) shall be rescinded by the Committee (to the extent permitted under applicable law), provided that the rescission shall be effective only if the Committee notifies the Optionee of the rescission no later than one year after the restated financial statements are issued. In the event of any such rescission, the Optionee (regardless of whether then employed) shall pay to the Company the amount of any gain realized as a result of the rescinded exercise (determined as of the time of exercise), in such manner and on such terms and conditions as may be required by the Company, provided that the Company shall be entitled to set-off against the amount of any such gain any amount owed to the Optionee Participant by the Company. (e) This Agreement is a voluntary agreement, and each Optionee who has accepted the Agreement Participant acknowledges that he has chosen to do so sign it voluntarily. The Optionee Participant acknowledges and understands that all Options YRSUs provided under the this Agreement and all amounts paid shares issued to the Optionee Participant under the this Agreement are provided as an advance that is contingent on the Company's ’s financial statements not being subject to a material restatement. As a condition of the this Agreement, the Optionee Participant specifically agrees that the Committee may cancel, rescind, suspend, withhold or otherwise limit or restrict the Option Award for any individual party to such an agreement YRSUs and the shares of Stock issued in respect thereof due to a material restatement of the Company's ’s financial statements, as provided in this Section 5 paragraph 9 including all subsections subparagraphs (a) through (g). In the event that amounts shares of Stock have been paid issued to an individual the Participant pursuant to the this Agreement and the Committee determines that the individual Participant must repay return shares or pay an amount to the Company as a result of the Committee's ’s cancellation, rescission, suspension, withholding or other limitation or restriction of rightsshares, the Optionee Participant agrees, as a condition of being awarded such rightsYRSUs, to make such repaymentsreturn or payment. (f) The Board may reduce the amount to be recouped under the foregoing provisions of this Section 5 paragraph 9 based on such factors as the Board determines in its sole discretion to be relevant. Such factors may include, without limitation, the extent to which the gain is determined to be attributable to events prior to the restated year (or other period), and whether the Optionee Participant continued to hold the Stock acquired upon the exercise of the Option under this Agreement during a period in which the value of the Stock declined. (g) For purpose of this Section 5paragraph 9, (i) the term “misconduct” means fraudulent or illegal conduct or omission that is knowing or intentional; and (ii) no conduct or omission shall be deemed “knowing” by a Optionee the Participant unless done, or omitted to be done, by the Optionee Participant not in good faith and without reasonable belief that the Optionee's Participant’s action or omission was in the best interest of the Company; and (iii) a buy out of the Option Award in accordance with Section 11 shall be treated as the exercise of the Option. Sections (b) through (f) above shall apply only to Awards granted after December 31, 2008.