AMENDMENT TO AGREEMENT DATED DECEMBER 31, 2004
AMENDMENT
TO
AGREEMENT
DATED DECEMBER 31, 2004
THIS
AMENDMENT (this “Amendment”)
is
made this 1st day of January 2008 by and between Icahn Capital Management LP
(“ICM”),
Icahn
Management LP, Icahn Capital LP (the “Employer”),
Icahn
Onshore LP (the “Onshore
GP”),
Icahn
Offshore LP (the “Offshore
GP”
and
together with the Onshore GP, the “Fund
GPs”),
Icahn
Enterprises L.P. (“IELP”),
the
Icahn Related Entities (as defined below) and Xxxxxxx X. Xxxxxxxx residing
at
0000 Xxxx Xxxxxx, Xxxx 0X, Xxx Xxxx, XX 00000 (“Employee”
or
“you”).
RECITALS:
Employee
executed an Agreement dated as of December 31, 2004 (as amended to date
including by this Amendment, the “Agreement”;
capitalized terms used herein and not otherwise defined shall have the meanings
set forth in the Agreement as amended) with, among others, Icahn Management
LP,
the Onshore GP, the Offshore GP and the Icahn Related Entities (as defined
in
the Agreement).
The
Agreement was assigned by Icahn Management LP to ICM on August 8,
2007.
Icahn
Management LP and ICM have provided administrative and back office services
to
Icahn Partners LP, Icahn Master Fund LP and certain other fund clients (the
“Funds”)
in
consideration of the payment of management fees by the Funds. The management
agreements providing for such management fees (the “Management
Agreements”)
were
terminated during the first day of January 2008.
The
limited partnership agreements of the Funds (the “Fund
LPAs”)
were
amended to provide that as of January 1, 2008 (the “Effective
Date”)
(i)
the Fund GPs will provide administrative and back office services to the Funds
and (ii) the Fund GPs will receive Special Profits Interest Allocations (as
defined in the Fund LPAs).
Each
of
ICM, the Onshore GP, the Offshore GP and the Employer is owned indirectly by
IELP.
Under
the
Agreement, prior to the amendments contemplated herein, Employee is, generally
speaking, entitled to the following during the Term:
| a) |
a
2.5% interest in management fees paid between November 3, 2004 and
the
last day of the Term, vesting as set forth in the
Agreement;
|
| b) |
a
2.5% participation in the incentive allocations from the Funds made
between November 3, 2004 and the last day of the Term, vesting as
set
forth in the Agreement.
|
Pursuant
to the various agreements contemplated above, the management agreement and
the
management fees are being terminated and the general partners of the Funds
are
going to be receiving Special Profits Interest Allocations from the Funds
(together, the “Termination
and Allocation”).
The parties are entering into this Amendment with the intent of maintaining
their economic rights and obligations under the Agreement, as generally
summarized above in paragraphs (a) through (b) taking into account the
Termination and Allocation and this Amendment should be interpreted to
maintain the substance of the rights and obligations set forth in such
paragraphs (it being understood by the parties however that under the
Agreement as amended hereby the 2.5% interest in management fees will instead
come only out of profits (through the Special Profits Interest Allocations)
earned by the Funds, if any.
The
parties wish the amendments to the Agreement effected hereby to be effective
as
of the Effective Date.
In
consideration of the premises, and for other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, effective as of
the
Effective Date the parties agree as follows:
1. Management
Agreements Termination.
The
Employee agrees that although the Management Agreements were in effect for
a
portion of January 1, 2008 and were then terminated, he is not entitled to
any payment in respect of the management fees that were payable thereunder
prior
to termination for 2008 (or thereafter) inasmuch as the parties to the
Management Agreements have agreed that no management fees were accrued or earned
thereunder after December 31, 2007.
2. Employment.
Icahn
Capital LP shall be an “Icahn Entity” for all purposes of the Agreement. All
references to “Employer” in the Agreement shall be references to Icahn Capital
LP.
3. Amendments
to Defined Terms.
For all
periods from and after January 1, 2008:
A. All
references in the Agreement to “the Management Company” shall be references to
“the Fund GPs”.
B. All
references in the Agreement to “Management Fees” shall be references to “the
Fund GPs’ Special Profits Interest Allocations” and all references to
“Management Fee Participation” shall be to “Employee’s Special Profits Interest
Allocation Participation”.
C. “The
Fund GPs’ Special Profits Interest Allocations”
shall
mean in respect of each year of the Term commencing on or after the Effective
Date, each of Onshore GP’s and Offshore GP’s Special Profits Interest
Allocations in the Funds. For the avoidance of doubt, no incremental cost,
if
any, that may be incurred by the Fund GPs and that is attributable to the
compensation, bonus or expenses of Xxxx X. Icahn under his employment agreement
dated August 8, 2007, as amended from time to time, with ICM and IELP or to
the
earn-out payable to Mr. Icahn and his Affiliates under the Contribution
Agreement executed on August 8, 2007 in connection therewith, or to any expenses
incurred because the Fund GPs will be owned by IELP and its Affiliates (that
is,
dealing with IELP’s accounting and reporting requirements), will diminish any
amounts to be accrued or paid to Employee pursuant to the
Agreement.
4. Restatement.
For all
periods from and after January 1, 2008, Section 9 of the Agreement is hereby
amended and restated in its entirety as follows:
2
9. Profit
Participation.
i) Subject
to all of the terms and provisions of this Agreement (including, without
limitation, those relating to vesting and forfeiture) the Employee shall be
entitled to receive 2.5% of the Fund GPs’ Special Profits Interest Allocations
and 2.5% of the Incentive Allocations allocated to the Fund GPs during the
period from January 1, 2008 through the last day of the Term. If, due to
any miscalculation or any other reason, the Employee shall have been allocated
more or less than he is entitled to under the Agreement, then an appropriate
adjustment shall be made.
ii) The
Employee’s participation in the Fund GPs’ Special Profits Interest Allocations
and Incentive Allocations for each year shall be reflected by the establishment
of capital accounts (the “Employee Capital Accounts”) in the name of Employee,
as a limited partner, under the Partnership Agreements. As contemplated by
the
Fund LPAs, all amounts credited to each Employee Capital Account in respect
of
the Fund GPs’ Net Special Interest Allocations and Incentive Allocations will be
invested by the Onshore GP in the Onshore Fund and by the Offshore GP in Icahn
Partners Master Fund LP, Icahn Partners Master Fund II LP and Icahn Partners
Master Fund III LP (collectively, the “Offshore Funds”), in each case for the
benefit of the Employee Capital Account established in the Onshore GP or
Offshore GP, as the case may be. The right of the Employee to participate in
each of the Fund GPs’ Special Profits Interest Allocations (the “Employee’s
Special Profits Interest Allocation Participation”) and the Incentive
Allocations (the “Employee’s Incentive Allocation Participation”), subject to
and in accordance with the terms of this Agreement, and in any investment made
in respect thereof in accordance with the terms of this Agreement and all
returns, earnings and profits thereon, are referred to collectively herein
as
the “Profit Participation”.
iii) Subject
to the final sentence of this paragraph 9(iii), Employee acknowledges and agrees
that pursuant to the terms of this Agreement, Employee will only participate
in
the Fund GPs’ Special Profits Interest Allocations and Incentive Allocations
allocated from January 1, 2008 until he ceases to be employed hereunder and
that
if such employment ceases for any reason he will not accrue any further benefit
in respect of the Fund GPs’ Special Profits Interest Allocations or Incentive
Allocations allocated thereafter, nor will he have any ongoing rights or
interest in respect of the Fund GPs’ Special Profits Interest Allocations or
Incentive Allocations allocated on or prior to the date such employment ceases
other than the right to Vested Amounts (as defined below) in respect of Fund
GPs’ Special Profits Interest Allocations and Incentive Allocations allocated on
or prior to the date such employment ceases (and any investment made in respect
thereof, and all returns, earnings and profits thereon, made in accordance
with
the terms of this Agreement). Because the Fund GPs’ Net Special Interest
Allocations and Incentive Allocations are made as of year end (other than in
the
event of dissolution, partner withdrawal or other events specified in the Fund
LPAs, in which event such allocations are made as of the date prior to year
end
specified in such agreement (the periods in respect of which such allocations
are made, each a “Short Period”)), in the event that the employment of Employee
hereunder ceases, the Employee’s Special Profits Interest Allocation
Participation and Incentive Allocation Participation under this Agreement will
include a pro rated portion of 2.5% of the immediately following Fund GPs’
Special Profits Interest Allocations and Incentive Allocations (based upon
the
number of days elapsed in the one year period beginning on January 1 of the
year
in which such employment ceases, divided by 365 (and in the case of a Short
Period during which such employment ceases, the number of days elapsed from
January 1 of the Short Period until such employment ceases, divided by the
total
number of days in the Short Period).
3
5. Prior
Rights Undiminished.
The
parties agree and acknowledge that (i) except as provided in Section 6 below,
the Employee’s rights under the Agreement with respect to periods prior to the
Effective Date (including, without limitation, with respect to management fees
and incentive allocations earned and allocated prior to such date) remain intact
and are not amended, affected or diminished in any way by this Amendment and
(ii) this Amendment shall not release the Other Parties from their obligations
under the Agreement, and the Other Parties will continue to be responsible
for
the obligations under the Agreement, to the extent they are not performed by
the
Fund GPs, the Employer or their affiliates.
6. Deferral
Termination Trigger. The
Agreement, including without limitation Section 10 and Section(b)(I) of Schedule
A thereof and Section 5 of the February 1, 2007 amendment thereof, is amended
pursuant to transition relief promulgated under Section 409A of the Internal
Revenue Code of 1986, as amended, and contained in Internal Revenue Service
Notices 2005-1, 2006-79 and 2007-86 and Section XI(C) of the preamble to
REG-158080-04, 2005-43 I.R.B. 786, dated October 4, 2005 (Application of Section
409A to Nonqualified Deferred Compensation Plans), to delete all provisions
that
would permit or cause any portion of the deferred Management Fee Participation
owing by Icahn Management LP or ICM to Employee with respect to periods prior
to
the Effective Date to be payable to the Employee upon the termination of
Management Agreements.
7. Change
in Character.
For all
periods from and after January 1, 2008, and after giving effect to Section
6
above, Sections 10 and 21(ix) and Section(b)(I) of Schedule A of the Agreement
and Section 5 of the February 1, 2007 amendment to the Agreement are
deleted in their entirety except with respect to the portions of the Management
Fee Participation that were properly deferred pursuant to the Agreement prior
to
January 1, 2008. For the avoidance of doubt and without limiting Section 5
above, such sections (exclusive of the third sentence of Section 5 of the
February 1, 2007 amendment to the Agreement which is deleted for all
purposes) shall continue to be applicable to the portions of the Management
Fee
Participation that were properly deferred pursuant to the Agreement in respect
of periods to January 1, 2008.
4
8. Vesting.
Employee’s right to receive any amount or payments in respect of the Profit
Participation allocated from and after the Effective Date shall vest in
accordance with Section 11 of the Agreement, taking into account for such
purpose Employee’s periods of service with Icahn Management LP, ICM and the
other Icahn Related Entities commencing January 1, 2005 through the date
preceding the Effective Date, and Employee’s periods of service with the
Employer and the other Icahn Related Entities from and after the Effective
Date.
For the avoidance of doubt, none of the execution of this Amendment, the
termination of the Management Agreements or the Employee’s ceasing to provide
services to ICM as of the Effective Date shall accelerate vesting of the Profit
Participation payable by Icahn Management LP or ICM pursuant to Section 11
of
the Agreement.
9. Withdrawal.
Sections 12(ii) and 13 of the Agreement are amended to delete the following
text
in both places where it appears: “(calculated in accordance with the methodology
set forth in the Partnership Agreement of the applicable Fund GP)”.
10. Governing
Law.
This
Amendment shall be governed by and construed in accordance with the laws of
the
State of New York applicable to agreements made and/or to be performed in that
State, without regard to any choice of law provisions thereof. All disputes
arising out of or related to this Amendment shall be submitted to the state
and
federal courts of New York, and each party irrevocably consents to such personal
jurisdiction and waives all objections thereto, but does so only for the
purposes of this Amendment.
11. Agreement
in Force.
Except
as specifically amended by this Amendment, all terms and provisions of the
Agreement, shall remain and continue in full force and effect.
12. Responsibility
of IELP.
IELP
shall be jointly and severally responsible for the obligations of the Employer
and the Fund GPs under the Agreement.
[INTENTIONALLY
LEFT BLANK]
5
IN
WITNESS WHEREOF, the undersigned have executed this Amendment as of the date
first written above.
/s/
Xxxxxxx X. Xxxxxxxx
Xxxxxxx
X. Xxxxxxxx
ICAHN
CAPITAL MANAGEMENT LP
By: /s/
Xxxxxx Xxxxxxx
Name:
Xxxxxx Xxxxxxx
Title:
Authorized Signatory
ICAHN
MANAGEMENT LP
By:
/s/ Xxxxxx Xxxxxxx
Name:
Xxxxxx Xxxxxxx
Title:
Authorized Signatory
ICAHN
CAPITAL LP
By:
IPH
GP LLC, its general partner
By:
Icahn
Enterprises Holding L.P.
By:
Icahn
Enterprises G.P. Inc.
By:
/s/ Xxxxxx Xxxxx
Name:
Xxxxxx Xxxxx
Title:
Chief Financial Officer
ICAHN
ONSHORE LP
By:
/s/ Xxxxxx Xxxxxxx
Name:
Xxxxxx Xxxxxxx
Title:
Authorized Signatory
ICAHN
OFFSHORE LP
By:
/s/ Xxxxxx Xxxxxxx
Name:
Xxxxxx Xxxxxxx
Title:
Authorized Signatory
6
By:
Icahn
Enterprises G.P. Inc., its general partner
By: /s/
Xxxxxx Xxxxx
Name:
Xxxxxx Xxxxx
Title:
Chief Financial Officer
ICAHN
RELATED ENTITIES
By:
/s/ Xxxx Xxxxx
Name:
Xxxx Xxxxx
Title: Authorized
Signatory
7
