Exhibit 10.4
2016 Stock Incentive Plan
of AdvanSix Inc. and its Affiliates
Form of Performance Stock Unit Agreement
PERFORMANCE STOCK UNIT
AGREEMENT (this “Agreement”) as of the [DAY] day of [MONTH YEAR] (the “Award Date”) between
AdvanSix Inc. (the “Company”) and [EMPLOYEE NAME].
| 1. | Grant of Award. The Company has granted you [NUMBER] Performance Stock Units (“Performance
Stock Units”), representing your Target Award, subject to the provisions of this Agreement and the 2016 Stock Incentive Plan
of AdvanSix Inc. and its Affiliates (the “Plan”). The Company will hold the Performance Stock Units and Additional
Performance Stock Units (as defined in Section 2) in a bookkeeping account on your behalf until they become payable or are forfeited
or cancelled. |
| 2. | Dividend Equivalents. Except as otherwise determined by the Committee, in its sole discretion,
you will earn Dividend Equivalents in an amount equal to the value of any cash or stock dividends paid by the Company upon one
Share of Common Stock for each unvested Performance Stock Unit or Additional Performance Stock Unit (as defined below) credited
to your bookkeeping account on a dividend record date. At the Vesting Date specified in Section 4, such Dividend Equivalents shall
be adjusted upward or downward based on your actual number of Performance Stock Units earned and vested in accordance with the
terms of this Agreement. In the case of cash dividends, the Company shall credit to your bookkeeping account, on each dividend
payment date, an additional number of Performance Stock Units (“Additional Performance Stock Units”) equal to (a) divided
by (b), where (a) equals the total number of unvested Performance Stock Units and Additional Performance Stock Units, if any, subject
to this Agreement on such date, multiplied by the dollar amount of the cash dividend paid per Share of Common Stock on such date,
and (b) equals the Fair Market Value of a Share on such date. If a dividend is paid to holders of Common Stock in Shares, the Company
shall credit to you, on each dividend payment date, Additional Performance Stock Units equal to the total number of unvested Performance
Stock Units and Additional Performance Stock Units subject to this Agreement on such date multiplied by the Share dividend paid
per Share of Common Stock on such date. Additional Performance Stock Units are subject to the same restrictions, including but
not limited to vesting, transferability and payment restrictions, that apply to the Performance Stock Units to which they relate. |
| 3. | Payment Amount. Performance Stock Units and Additional Performance Stock Units each represent
one (1) Share of Common Stock. |
| 4. | Vesting. Vesting of the Performance Stock Units and any Additional Performance Stock Units
is contingent upon achievement of the performance measures set forth in Schedule A, which is incorporated into and made
a part of this Agreement, and your continuous employment with the Company through the Vesting Date. Except as otherwise provided
in this Agreement or the Plan, any Performance Stock Units and Additional Performance Stock Units earned based on achievement of
the specific performance measures shall vest following the end of the Performance Cycle upon the Committee’s certification
of the level of attainment of the applicable performance measures (“Vesting Date”). |
| 5. | Form and Timing of Payment. Except as otherwise determined by the Committee in its sole
discretion or as provided in Section 8(a), vested Performance Stock Units and Additional Performance Stock Units will be redeemed
solely for Shares. Payment of any vested Performance Stock Units and any Additional Performance Stock Units will be made as soon
as practicable, but no later than 15 days, following the Vesting Date and in no event later than two and one-half (2-1/2) months
following the end of the calendar year in which the Vesting Date occurs. As determined by the Company in its sole discretion prior
to the Vesting Date, any fractional Shares may be paid in cash or rounded up or down to the nearest whole Share. |
| 6. | Termination of Service. Except as otherwise provided in Sections 7(a) and 8 of this Agreement,
any Performance Stock Units and Additional Performance Stock Units that have not vested as of your Termination of Service will
immediately be forfeited, and your rights with respect to these Performance Stock Units and Additional Performance Stock Units
will end. |
| 7. | Death or Disability. If your Termination of Service occurs due to death or due to the incurrence
of a Disability before the Vesting Date described in Section 4 of this Agreement, you will be entitled to a prorated portion of
the Award (or the Award without proration if your death or your incurrence of a Disability occurs after the last day of the Performance
Cycle but before the Award is paid) based upon the portion of the Performance Cycle during which you provided services to the Company,
which shall be paid at such time as the Award is otherwise payable, but only to the extent performance measures for the applicable
Performance Cycle are achieved. If you are deceased, the Company will make a payment to your estate only after the Committee has
determined that the payee is the duly appointed executor or administrator of your estate, subject to Section 7.14 of the Plan. |
| 8. | Change in Control. In the event of a Change in Control, the following provisions apply: |
| a. | Cashout of Awards. Unless assumed, substituted or continued in accordance with Section 5.4(a)
of the Plan, the Performance Stock Units and Additional Performance Stock Units shall vest, as of immediately |
| | | prior to the Change
in Control, as follows: all vesting criteria shall be deemed achieved at the greater of (i) target levels of achievement or (ii)
actual levels of performance achievement determined by the Committee in its sole discretion as of the date of the Change in Control.
Unless otherwise determined in good faith by the Committee, no later than 30
days after the date of the Change in Control, you will receive a single payment in cash equal to the product of (x)
the number of Performance Stock Units and Additional Performance Stock Units outstanding as of the date of the Change in Control
that vested pursuant to this Section 8(a) and (y) an amount equal to the highest price per Share paid by the successor company
in connection with such Change in Control, as determined by the Committee. |
| b. | Rollover of Awards. If assumed, substituted or continued in accordance with Section 5.4(a)
of the Plan, Performance Stock Units and Additional Performance Stock Units that have not vested or terminated as of the date of
the Change in Control will continue to vest in accordance with Section 4 of this Agreement (or as adjusted if more favorable);
provided, however, if you incur an involuntary Termination of Service not for Cause (as defined in Section 2.6 of the Plan) or
a voluntary Termination of Service for Good Reason (as defined in Section 5.4(c) of the Plan) on or before the second anniversary
of the date of the Change in Control, Performance Stock Units and Additional Performance Stock Units that have not vested or terminated
as of your Termination of Service will (i) immediately vest, as follows: all vesting criteria shall be deemed achieved at the greater
of (x) target levels of achievement or (y) actual levels of performance achievement determined in good faith by the Committee in
its sole discretion as of the date of the Termination of Service and (ii) be settled no later than 30 days after the Termination
of Service. |
| 9. | Withholdings. The Company or your local employer shall have the power and the right to deduct
or withhold, or require you to remit to the Company or to your local employer, prior to any issuance or delivery of Shares on Performance
Stock Units or Additional Performance Stock Units, an amount sufficient to satisfy taxes imposed under the laws of any country,
state, province, city or other jurisdiction, including but not limited to income taxes, capital gain taxes, transfer taxes, and
social security contributions, and National Insurance Contributions, that are required by law to be withheld as determined by the
Company or your local employer. |
| 10. | Transfer of Award. You may not transfer the Performance Stock Units, Additional Performance
Stock Units or any interest in such Units except by will or the laws of descent and distribution or except as otherwise permitted
by the Committee and as specified in the Plan. Any other attempt to dispose of your interest will be null and void. |
| 11. | Requirements for and Forfeiture of Award. |
| a. | General. The Award is expressly contingent upon you complying with the terms, conditions
and definitions contained in this Section 11 and in any other agreement that governs your noncompetition with the Company and its
Affiliates, your nonsolicitation of employees, customers, suppliers, business partners and vendors of the Company and its Affiliates,
and/or your conduct with respect to trade secrets and proprietary and confidential information of the Company and its Affiliates. |
| 1. | You expressly agree and acknowledge that the forfeiture provisions of subsection 11.b.2. of this
Agreement shall apply if, from the Award Date until the date that is twenty-four (24) months after your Termination of Service
for any reason, you (i) enter into an employment, consultation or similar agreement or arrangement (including any arrangement for
service as an agent, partner, stockholder, consultant, officer or director) with any entity or person engaged in a business in
which the Company or its Affiliates are engaged if the business is competitive (in the sole judgment of the Committee) with the
Company or its Affiliates and the Committee has not approved the agreement or arrangement in writing, or (ii) make any statement,
publicly or privately (other than to your spouse and legal advisors), which would be disparaging (as defined below) to the Company
and its Affiliates or their businesses, products, strategies, prospects, condition, or reputation or that of their directors, employees,
officers or members, or (iii) write or contribute to a book, article or other media publication, whether in written or electronic
format, that is in any way descriptive of the Company and its Affiliates or your career with the Company and its Affiliates without
first submitting a draft thereof, at least thirty (30) days in advance, to the Company’s Senior Vice President, General Counsel
and Corporate Secretary or his or her delegate, whose judgment about whether such book, article or other media publication is disparaging
shall be determinative; or such a book, article or other media publication is published after a determination that it is disparaging;
provided, however, that nothing herein shall preclude you from reporting (in good faith) possible violations of federal law or
regulation to any governmental agency or entity, including but not limited to, the Department of Justice, the Securities and Exchange
Commission, the Congress, and/or any agency Inspector General, or making any other disclosures that are protected under the whistleblower
provisions of federal or state law or regulation, or from otherwise |
| | | making any statement (in good faith) which is required by any
applicable law or regulation or the order of a court or other governmental body. |
For purposes of this subsection 11.b.1,
the term “disparaging” shall mean any statement or representation (whether oral or written and whether true or untrue)
which, directly or by implication, tends to create a negative, adverse, or derogatory impression about the subject of the statement
or representation or which is intended to harm the reputation of the subject of the statement or representation.
| 2. | In addition to the relief described in any other agreement that governs your noncompetition with
the Company and its Affiliates, your nonsolicitation of the employees, customers, suppliers, business partners and vendors of the
Company and its Affiliates, and/or your conduct with respect to the trade secrets and proprietary and confidential information
of the Company and its Affiliates, if the Committee determines, in its sole judgment, that you have violated the terms of any such
agreement, or you have engaged in an act that violates subsection 11.b.1. of this Agreement, (i) any Performance Stock Units and
Additional Performance Stock Units that have not vested under this Agreement shall immediately be cancelled, and you shall forfeit
any rights you have with respect to such Units as of the date of the Committee’s determination, and (ii) you shall immediately
deliver to the Company Shares (or the cash equivalent) equal in value to any Performance Stock Units and Additional Performance
Stock Units you received during the period beginning twelve (12) months prior to your Termination of Service and ending on the
date of the Committee’s determination. |
| 3. | Notwithstanding anything in the Plan or this Agreement to the contrary, you acknowledge that the
Company may be entitled or required by law, Company policy or the requirements of an exchange on which the Shares are listed for
trading, to recoup compensation paid to you pursuant to the Plan, and you agree to comply with any Company request or demand for
recoupment. |
| 12. | Restrictions on Payment of Shares. Payment of Shares for your Performance Stock Units and
Additional Performance Stock Units is subject to the conditions that, to the extent required at the time of settlement, (i) the
Shares underlying the Performance Stock Units and Additional Performance Stock Units will be duly listed upon the New York Stock
Exchange (or any other securities exchange on which Shares may be listed), and (ii) a Registration Statement under the Securities
Act of 1933 with respect to the Shares will be effective. The Company will not |
| | be required to deliver any Shares until all applicable
federal and state laws and regulations have been complied with and all legal matters in connection with the issuance and delivery
of the Shares have been approved by counsel for the Company. |
| 13. | Adjustments. Any adjustments to the Performance Stock Units and Additional Performance Stock
Units will be governed by Section 5.3 of the Plan. |
| 14. | Disposition of Securities. By accepting the Award, you acknowledge that you have read and
understand the Company’s policy, and are aware of and understand your obligations under applicable securities laws in respect
of trading in the Company’s securities. The Company will have the right to recover, or receive reimbursement for, any compensation
or profit you realize on the disposition of Shares received for Performance Stock Units or Additional Performance Stock Units to
the extent that the Company has a right of recovery or reimbursement under applicable securities laws. |
| 15. | Plan Terms Govern. The vesting of Performance Stock Units or Additional Performance Stock
Units, the disposition of any Shares received for Performance Stock Units or Additional Performance Stock Units, the treatment
of gain on the disposition of these Shares, and the treatment of Dividend Equivalents are subject to the provisions of the Plan
and any rules that the Committee may prescribe. The Plan document, as may be amended from time to time, is incorporated into this
Agreement. Capitalized terms used in this Agreement have the meaning set forth in the Plan, unless otherwise stated in this Agreement.
In the event of any conflict between the terms of the Plan and the terms of this Agreement, the Plan will control. By accepting
the Award, you acknowledge that the Plan and the Plan prospectus, as in effect on the date of this Agreement, have been made available
to you for your review. |
| a. | By entering into this Agreement, and as a condition of the grant of the Performance Stock Units,
you expressly consent to the collection, use, and transfer of personal data as described in this Section to the full extent permitted
by and in full compliance with applicable law. |
| b. | You understand that your local employer holds, by means of an automated data file, certain personal
information about you, including, but not limited to, name, home address and telephone number, date of birth, social insurance
number, salary, nationality, job title, any shares or directorships held in the Company, details of all restricted units or other
entitlement to shares awarded, canceled, exercised, vested, unvested, or outstanding in your favor, for the purpose of managing
and administering the Plan (“Data”). |
| c. | You further understand that part or all of your Data may be also held by the Company or its Affiliates,
pursuant to a transfer made in the past with your consent, in respect of any previous grant of restricted units or awards, which
was made for the same purposes of managing and administering of previous award/incentive plans, or for other purposes. |
| d. | You further understand that your local employer will transfer Data to the Company or its Affiliates
among themselves as necessary for the purposes of implementation, administration, and management of your participation in the Plan,
and that the Company or its Affiliates may transfer Data among themselves, and/or each, in turn, further transfer Data to any third
parties assisting the Company in the implementation, administration, and management of the Plan (“Data Recipients”). |
| e. | You understand that the Company or its Affiliates, as well as the Data Recipients, are or may be
located in your country of residence or elsewhere, such as the United States. You authorize the Company or its Affiliates, as well
as the Data Recipients, to receive, possess, use, retain, and transfer Data in electronic or other form, for the purposes of implementing,
administering, and managing your participation in the Plan, including any transfer of such Data, as may be required for the administration
of the Plan and/or the subsequent holding of Shares on your behalf, to a broker or third party with whom the Shares may be deposited. |
| f. | You understand that you may show your opposition to the processing and transfer of your Data, and,
may at any time, review the Data, request that any necessary amendments be made to it, or withdraw your consent herein in writing
by contacting the Company. You further understand that withdrawing consent may affect your ability to participate in the Plan. |
| 17. | Discretionary Nature and Acceptance of Award. By accepting this Award, you agree to be bound
by the terms of this Agreement and acknowledge that: |
| a. | The Company (and not your local employer) is granting your Performance Stock Units and Additional
Performance Stock Units. Furthermore, this Agreement is not derived from any preexisting labor relationship between you and the
Company, but rather from a mercantile relationship. |
| b. | The Company may administer the Plan from outside your country of residence and United States law
will govern all Performance Stock Units and Additional Performance Stock Units granted under the Plan. |
| c. | Benefits and rights provided under the Plan are wholly discretionary and, although provided by
the Company, do not constitute regular or periodic payments. |
| d. | The benefits and rights provided under the Plan are not to be considered part of your salary or
compensation under your employment with your local employer for purposes of calculating any severance, resignation, redundancy
or other end of service payments, vacation, bonuses, long-term service awards, indemnification, pension or retirement benefits,
or any other payments, benefits or rights of any kind. You waive any and all rights to compensation or damages as a result of the
Termination of Service with your local employer for any reason whatsoever insofar as those rights result, or may result, from the
loss or diminution in value of such rights under the Plan or your ceasing to have any rights under, or ceasing to be entitled to
any rights under, the Plan as a result of such termination. |
| e. | The grant of Performance Stock Units and Additional Performance Stock Units hereunder, and any
future grant of Performance Stock Units or Additional Performance Stock Units under the Plan, is entirely voluntary, and at the
complete discretion of the Company. Neither the grant of the Performance Stock Units, the Additional Performance Stock Units nor
any future grant by the Company will be deemed to create any obligation to make any future grants, whether or not such a reservation
is explicitly stated at the time of such a grant. The Company has the right, at any time and/or on an annual basis, to amend, suspend
or terminate the Plan; provided, however, that no such amendment, suspension, or termination will adversely affect your rights
hereunder. |
| f. | The Plan will not be deemed to constitute, and will not be construed by you to constitute, part
of the terms and conditions of employment. Neither the Company nor your local employer will incur any liability of any kind to
you as a result of any change or amendment, or any cancellation, of the Plan at any time. |
| g. | Participation in the Plan will not be deemed to constitute, and will not be deemed by you to constitute,
an employment or labor relationship of any kind with the Company. |
| 18. | Limitations. Nothing in this Agreement or the Plan gives you any right to continue in the
employ of the Company or any of its Affiliates or to interfere in any way with the right of the Company or any Affiliate to terminate
your employment at any time. Payment of your Performance Stock Units and Additional Performance Stock Units is not secured by a
trust, insurance contract or other funding medium, and you do not have any interest in any fund or specific asset of the Company
by reason of this Award or the account established on your behalf. You have no rights as a stockholder of the Company pursuant
to the Performance Stock Units or Additional Performance Stock Units until Shares are actually delivered to you. |
| 19. | Incorporation of Other Agreements. This Agreement and the Plan constitute the entire understanding
between you and the Company regarding the Performance Stock Units. This Agreement supersedes any prior agreements, commitments
or negotiations concerning the Performance Stock Units and the Additional Performance Stock Units. |
| 20. | Severability. The invalidity or unenforceability of any provision of this Agreement will
not affect the validity or enforceability of the other provisions of the Agreement, which will remain in full force and effect.
Moreover, if any provision is found to be excessively broad in duration, scope or covered activity, the provision will be construed
so as to be enforceable to the maximum extent compatible with applicable law. |
| 21. | Governing Law. The Plan, this Agreement, and all determinations made and actions taken under
the Plan or this Agreement shall be governed by the internal substantive laws, and not the choice of law rules, of the State of
Delaware and construed accordingly, to the extent not superseded by applicable federal law. |
| 22. | Agreement Changes. The Company reserves the right to change the terms of this Agreement
and the Plan without your consent to the extent necessary or desirable to comply with the requirements of Code section 409A, the
Treasury regulations and other guidance thereunder. |
| 23. | Successors and Assigns of the Company. The terms and conditions of this Agreement shall
be binding upon and shall inure to the benefit of the Company and its successors and assigns. |
| 24. | Acknowledgements. By accepting this Agreement, you agree to the following: (i) you have
carefully read, fully understand and agree to all of the terms and conditions described in this Agreement, the Plan, the Plan’s
prospectus and all accompanying documentation; and (ii) you understand and agree that this Agreement and the Plan constitute
the entire understanding between you and the Company regarding the Performance Stock Units, and that any prior agreements, commitments
or negotiations concerning the Performance Stock Units are replaced and superseded. |
| 25. | Award Acceptance. To retain this Award, you must accept it by signing the Agreement below
and, by signing this Agreement, you will be deemed to consent to the application of the terms and conditions set forth in this
Agreement and the Plan. If you do not wish to accept this Award, you must contact AdvanSix Inc., 000 Xxxxxxx Xxxxx, Xxxxx 000,
Xxxxxxxxxx, Xxx Xxxxxx 00000 in writing within thirty (30) days of the Award Date, or otherwise this Award shall for all purposes
be deemed accepted. |
Schedule A
Performance Share Units (PSUs)
[Performance Cycle and Vesting Terms]
