Form 8-K Inteliquent, Inc. For: Jun 22

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1834

Date of Report (Date of earliest event reported): June 22, 2015

 

 

INTELIQUENT, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware		001-33778		31-1786871
(State or other jurisdiction of incorporation)		(Commission File Number)		(IRS Employer Identification No.)

550 West Adams Street

9th Floor

Chicago, Illinois 60661

(Address of principal executive offices, including Zip Code)

(312) 384-8000

(Registrant’s telephone number, including area code)

(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:

 

¨	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))

 

 

 

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Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Performance Stock Unit Award

On June 22, 2015, the Compensation Committee (the “Committee”) of the Board of Directors of Inteliquent, Inc. (the “Company”) approved the following performance stock unit award:

 

Name

Title

Target Performance Stock Units

18-Month Period

Two-Year Period

Three-Year Period

Matthew Carter, Jr.

President and Chief Executive Officer

5,625

11,249

16,874

The performance stock units are measured over 18- month, two- and three-year performance periods. Each performance stock unit represents the right to receive, if and to the extent the Company’s total shareholder return (“TSR”) performance targets covering the 18-month, two- and three-year performance periods are satisfied, a share of the Company’s common stock following completion of the performance period. At the end of the performance period, the performance stock units will be distributed (to the extent earned and vested) in shares of the Company’s common stock based upon the level of achievement of the Company’s TSR performance targets set for the performance periods as determined by the Committee. If the Company fails to meet the threshold performance for any of the 18-month, two- or three year performance periods, no performance stock units will vest and no payout of Company common stock will be made with respect to the performance period for such performance stock units. If the Company’s performance exceeds the target performance, Mr. Carter may receive additional performance stock units above the target number, subject to a maximum of 200% of the target award. Mr. Carter’s performance stock unit award agreement contains provisions dealing with, among other things, (1) the effect on the award of the termination of the Mr. Carter’s service as an employee of the Company without Cause (as defined in the Neutral Tandem, Inc. (n/k/a Inteliquent, Inc.) Amended and Restated 2007 Equity Incentive Plan (the “Plan”)), (2) the effect on the award of a Change In Control of the Company (as defined in the Plan) and (3) the delivery of the Company’s common stock in respect of vested performance stock units.

The TSR performance stock unit grant agreement between Mr. Carter and the Company is filed herewith as Exhibit 10.1 and is incorporated herein by reference.

Restricted Stock Grant

On June 22, 2015, the Committee approved the following restricted stock grant:

 

Name		Title		Restricted Stock Grant
Matthew Carter, Jr.		President and Chief Executive Officer		16,874

The terms of Mr. Carter’s restricted stock grant agreement are substantially identical to the Company’s form of restricted stock grant agreement, but also contains provisions dealing with, among other things, (1) the effect on the grant of the termination of Mr. Carter’ service as an employee of the Company without Cause (as defined in Mr. Carter’s employment agreement with the Company) and (2) the effect on the grant of a Change In Control of the Company (as defined in the Plan).

The restricted stock grant agreement between Mr. Carter and the Company is filed herewith as Exhibit 10.2 and is incorporated herein by reference.

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Stock Option Award

On June 22, 2015, the Committee approved the following stock option award:

 

Name		Title		Stock Option Award
Matthew Carter, Jr.		President and Chief Executive Officer		46,467

The terms of Mr. Carter’s non-qualified stock option award agreement are substantially identical to the Company’s form of non-qualified stock option award agreement, but also contains provisions dealing with, among other things, (1) the effect on the award of the termination of Mr. Carter’ service as an employee of the Company without Cause (as defined in Mr. Carter’s employment agreement with the Company) and (2) the effect on the award of a Change In Control of the Company (as defined in the Plan).

The non-qualified stock option award agreement between Mr. Carter and the Company is filed herewith as Exhibit 10.3 and is incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

 

Exhibit No.		Description
10.1		TSR Performance Stock Unit Grant Agreement between Mr. Carter and the Company.
10.2		Restricted Stock Grant Agreement between Mr. Carter and the Company.
10.3		Non-Qualified Stock Option Award Agreement between Mr. Carter and the Company.

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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.

 

				INTELIQUENT, INC.
				/s/ Richard L. Monto
Date: June 23, 2015				Name:		Richard L. Monto
				Title:		General Counsel, Senior Vice President and Corporate Secretary

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EXHIBIT INDEX

 

Exhibit No.		Description
10.1		2015 Form of TSR Performance Stock Unit Grant Agreement.
10.2		Restricted Stock Grant Agreement between Mr. Carter and the Company.
10.3		Non-Qualified Stock Option Award Agreement between Mr. Carter and the Company.

Exhibit 10.1

TSR PERFORMANCE STOCK UNIT GRANT AGREEMENT

*  *  *  *  *

Participant: Matthew Carter, Jr.

Grant Date: June 22, 2015

 

2015 Target Number of Performance Stock Units (the “2015 Target PSUs”)			5,625
2016 Target Number of Performance Stock Units (the “2016 Target PSUs”)			11,249
2017 Target Number of Performance Stock Units (the “2017 Target PSUs”)			16,874

Maximum Number of Shares of Common Stock that may be issued pursuant to this Agreement (the “Maximum Shares”): 33,748

*  *  *  *  *

THIS TSR PERFORMANCE STOCK UNIT GRANT AGREEMENT (this “Agreement”), dated as of the Grant Date specified above, is entered into by and between Inteliquent, Inc., a corporation organized in the State of Delaware (the “Company”), and the Participant specified above, pursuant to the Neutral Tandem, Inc. (n/k/a Inteliquent, Inc.) Amended and Restated 2007 Equity Incentive Plan, as in effect and as amended from time to time (the “Plan”), which is administered by the Committee.

WHEREAS, it has been determined under the Plan that it would be in the best interests of the Company to grant Performance Stock Units (“PSUs”) provided herein to the Participant, including the 2015 Target PSUs, the 2016 Target PSUs and 2017 Target PSUs (collectively, the “Target PSUs”).

NOW, THEREFORE, in consideration of the mutual covenants and promises hereinafter set forth and for other good and valuable consideration, the parties hereto hereby mutually covenant and agree as follows:

1. Incorporation By Reference; Plan Document Receipt. This Agreement is subject in all respects to the terms and provisions of the Plan (including, without limitation, any amendments thereto adopted at any time and from time to time unless such amendments are

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expressly intended not to apply to the PSUs provided hereunder, and subject to the consent of the Participant in the case of an amendment that would adversely affect Participant’s rights except as otherwise permitted by Section 18 of the Plan), all of which terms and provisions are made a part of and incorporated in this Agreement as if they were each expressly set forth herein, except as otherwise provided herein. The definitions in the Plan will apply to any term not defined in this Agreement. The Participant hereby acknowledges receipt of a copy of the Plan and that the Participant has read the Plan carefully and fully understands its content. In the event of any conflict between the terms of this Agreement and the terms of the Plan, the terms of the Plan shall control. Notwithstanding the foregoing, (a) you will not be considered to have engaged in “Competition” as defined in the Plan unless you have breached the provisions of Section 4.2 of your employment agreement, and (b) the determination of whether you have engaged in Competition, or the reason for the termination of your employment, shall be determined in accordance with the provisions of your employment agreement.

2. Grant of Performance Stock Unit. The Company hereby grants to the Participant, as of the Grant Date specified above, the number of Target PSUs specified above, with the actual number of shares of Common Stock to be issued and delivered pursuant to this grant contingent upon satisfaction of the vesting and performance conditions described in Section 3 hereof, subject to Sections 4 through 6, which may not exceed the Maximum Shares. Such grant is intended to constitute a Performance Award for purposes of the Plan. Except as otherwise provided by the Plan, the Participant agrees and understands that nothing contained in this Agreement provides, or is intended to provide, the Participant with any protection against potential future dilution of the Participant’s interest in the Company for any reason, and no adjustments shall be made for dividends in cash or other property, distributions or other rights in respect of the shares of Common Stock underlying the PSUs, except as otherwise specifically provided for in the Plan or this Agreement.

3. Performance Goals and Vesting of PSUs

(a) The “Performance Period” for the respective PSUs granted hereunder shall be as follows: (i) for the 2015 Target PSUs: a one-year period beginning on January 1, 2015 and ending on December 31, 2015; (ii) for the 2016 Target PSUs: a two-year period beginning on January 1, 2015 and ending on December 31, 2016; and (iii) for the 2017 Target PSUs: a three-year period beginning on January 1, 2015 and ending on December 31, 2017.

(b) PSUs shall vest following the conclusion of the applicable Performance Period based on the Company’s total shareholder return (“TSR Ranking” or the “Performance Goal”) percentile rank, relative to the TSR of each company in the S&P 500 Index (“S&P 500”) and each company in the S&P Small Cap 600 Telecommunications Services Index (“S&P 600”) (collectively, the “Comparator Group”) computed during the applicable Performance Period with the company having the lowest TSR given a rank of 0% and the company with the highest TSR given a rank of 100%. After the Company’s relative ranking against each company in the applicable index has been determined during a Performance Period, the Company’s relative ranking against each company in the S&P 500 shall be weighted as two thirds (2/3) of the Comparator Group TSR and the Company’s relative ranking against each company in

 

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the S&P 600 shall be weighted as one third (1/3) of the Comparator Group TSR in order to determine the Company’s weighted average percentile rank, which shall constitute the Company’s TSR Ranking for purposes of this Agreement. The number of PSUs that become vested based upon the level of satisfaction of the Performance Goal are referred to herein as “Vested PSUs.”

(c) For purposes of this Agreement, “TSR” for the Company shall mean the sum of (i) the cumulative dividends paid during the applicable Performance Period plus (ii) the cumulative change in stock price from the beginning to the end of the applicable Performance Period expressed as a percentage return over the stock price at the beginning of such Performance Period. “TSR” for the Comparator Group shall mean the sum of (i) the cumulative dividends paid during the applicable Performance Period for each company in the Comparator Group plus (ii) the cumulative change in stock price from the beginning to the end of the applicable Performance Period of each company in the Comparator Group expressed as a percentage return over the applicable stock price at the beginning of such Performance Period, as determined by the Committee in its reasonable discretion.

(i) When computing TSR for the Company and the Comparator Group companies for the first Performance Period, the average stock price at the beginning of the Performance Period will be the average closing stock price for the Company and each company within the Comparator Group over the thirty (30) day period between June 1 and June 30 of 2014, and the average stock price at the end of the Performance Period will be the average closing stock price over the thirty (30) days in the month of December 2015. TSR will also include the total cumulative dividends paid during the first Performance Period (i.e., the same period referenced in the immediately prior sentence) for the Company and each company in the Comparator Group.

(ii) When computing TSR for the Company and the Comparator Group companies for the second and third Performance Periods, the average stock price at the beginning of the Performance Period will be the average closing stock price for the Company and each company within the Comparator Group over the thirty (30) days in the last month of the calendar year immediately preceding the year in which the Performance Period occurs, and the average stock price at the end of the Performance Period will be the average closing stock price over the thirty (30) days in the last month of the Performance Period. TSR will also include the total cumulative dividends paid during the applicable second or third Performance Period for the Company and each company in the Comparator Group.

(iii) If the stock of a company within the Comparator Group ceases to trade on a major exchange during a Performance Period, the TSR for that company will be calculated on the date the stock of that company ceases to trade on such exchange.

 

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(d) The Committee shall certify the level of TSR Ranking following the end of the Performance Period and prior to settlement of the Vested PSUs. No PSUs will be considered Vested PSUs if the Company’s TSR Ranking during the Performance Period is below the 25th percentile. The Participant must remain continuously employed by the Company or any of its Subsidiaries through the end of the applicable Performance Period to be eligible to fully vest in and receive any payment of the Vested PSUs, except as otherwise specifically provided for in the Plan, this Agreement or by the Committee. Notwithstanding the forgoing, the Committee may, in its discretion, adjust the level at which the Performance Goal is satisfied based upon changes in accounting methods, corporate transactions (including, without limitation, dispositions and acquisitions) or any other similar type events or circumstances.

(e) The amount of Vested PSUs, if any, for a Performance Period shall be determined in accordance with the chart below corresponding to the Company’s TSR Ranking (the “Vested PSU Payout Percent”). The Vested PSU Payout Percent shall be multiplied by the Target PSUs set forth in this Agreement for a particular Performance Period in determining the number of Vested PSUs. Linear interpolation shall be used to determine Vested PSUs earned between goal points listed in the chart below rounded to the nearest whole number of PSUs.

 

Goal Performance		Company’s TSR Ranking		Vested PSUs Payout Percent
		Lower than 25th Percentile		0%
Threshold Performance		At least 25th Percentile - and less than 30th Percentile		50%
		At least 30th Percentile - and less than 35th Percentile		60%
		At least 35th Percentile - and less than 40th Percentile		70%
		At least 40th Percentile - and less than 45th Percentile		80%
		At least 45th Percentile - and less than 50th Percentile		90%
Target Performance		At least 50th Percentile - and less than 55th Percentile		100%
		At least 55th Percentile - and less than 60th Percentile		110%
		At least 60th Percentile - and less than 65th Percentile		120%
		At least 65th Percentile - and less than 70th Percentile		130%
		At least 70th Percentile - and less than 75th Percentile		140%
Outstanding Performance		At least 75th Percentile - and less than 90th Percentile		150%
Maximum Performance		At least 90th Percentile and Higher		200%

 

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For Example, at “Target Performance” percentile rank, 100% of the Target PSUs granted to the Participant for a particular Performance Period under this Agreement would become Vested PSUs. At the “Maximum Performance” percentile rank, 200% of the Target PSUs granted to the Participant under this Agreement would become Vested PSUs.

4. Termination without Cause or for Good Reason Prior to Vesting. The Participant’s right to vest in any of the PSUs shall terminate in full and be immediately forfeited upon the Participant’s termination of employment for any reason. Notwithstanding the foregoing, unless the Committee elects otherwise, if the Participant’s employment with the Company is terminated without Cause or for Good Reason after 50% of a Performance Period has past, the Participant’s number of Target PSUs for such Performance Period shall be adjusted by multiplying the number of such Target PSUs by a fraction, the numerator of which is the number of days of service from the Grant Date through the date of such termination without Cause or for Good Reason, and the denominator of which is the total number of days in the applicable Performance Period. Such adjusted number of Target PSUs shall remain outstanding and will become Vested PSUs subject to the level of satisfaction of the Performance Goals for such Performance Period, as determined in accordance with this Section 4. The number of Vested PSUs to be settled (if any) shall then be calculated by multiplying such adjusted number of Target PSUs by the Vested PSUs Payout Percentage determined following completion of the Performance Period in accordance with Section 3 hereof.

5. Change in Control Prior to Vesting. The Participant’s right to vest in any PSUs following a Change in Control shall depend on (i) whether the PSUs are assumed, converted or replaced by the continuing entity, and (ii) the timing of the Change in Control within the Performance Period, in each case as follows:

(a) In the event that the PSUs are not assumed, converted, or replaced by the continuing entity following the Change in Control (as determined by the Committee), the Participant’s number of Target PSUs shall be adjusted by multiplying the number of such Target PSUs by a fraction, the numerator of which is the number of days from the commencement of each Performance Period through the date of such Change in Control, and the denominator of which is the total number of days in each Performance Period. The number of Vested PSUs to be settled (if any) shall then be calculated by multiplying such adjusted number of Target PSUs by the Vested PSUs Payout Percentage determined as of the date of such Change in Control in accordance with Section 3 hereof.

(b) In the event that the PSUs are assumed, converted, or replaced by the continuing entity following the Change in Control (as determined by the Committee), the number of Target PSUs that become Vested PSUs shall be determined following the conclusion of the applicable Performance Period in accordance with the level at which the Performance Goals are satisfied, determined in accordance with Section 3, subject to the terms of this Agreement. If the Participant’s employment is terminated without Cause or for Good Reason within twelve (12) months following the Change in Control, the vesting of his PSUs shall be governed by Section 4(a) except that the fraction referred to therein shall be one (1).

 

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(c) In the event that the Participant’s employment is terminated one (1) month or less prior to a Change in Control without Cause or for Good Reason, his unvested PSUs shall not be forfeited but shall remain outstanding for a period of one (1) month, and if a Change in Control occurs during such one (1) month period, the vesting of such PSUs shall be governed by (a) or (b), as applicable, and solely for purposes of (b), he shall be deemed to have been terminated immediately following the Change in Control.

6. Rights as a Stockholder. The Participant shall have no rights as a stockholder (including having no right to vote or to receive dividends) with respect to the Common Stock subject to the PSUs prior to the date the Common Stock is delivered to the Participant on account of the Vested PSUs in accordance with the settlement provisions of Section 7 of this Agreement. Notwithstanding the foregoing, if any dividends are paid with respect to the Common Stock of the Company during a Performance Period, additional shares of Common Stock will be issued to the Participant at the same time that the Vested PSUs are settled in Common Stock in accordance with the terms of this Agreement. The amount of such additional shares of Common Stock will be determined by multiplying (i) the total amount of dividends actually paid on a share of Common Stock prior to the date that the Vested PSUs are settled in accordance with the terms of this Agreement, by (ii) the number of Vested PSU, and then dividing such total by the Fair Market Value of the Common Stock on the last day of the applicable Performance Period, as determined by the Committee.

7. Settlement of Vested PSUs. Vested PSUs, rounded to the nearest whole unit, shall be delivered to Participant in the form of an equal number of shares of Common Stock, no later than March 15 of the calendar year following the calendar year in which the PSUs become Vested PSUs in accordance with the terms of this Agreement. PSUs that do not become Vested PSUs (a) as of the last day of the applicable Performance Period or (b) as of the Participant’s termination of employment (except as specifically provided herein) shall be immediately forfeited and the Participant shall have no further rights thereto.

8. Non-Transferability. Unless the Committee determines otherwise, no portion of the PSUs may be sold, assigned, transferred, encumbered, hypothecated or pledged by the Participant, other than to the Company as a result of forfeiture of the PSUs as provided herein, unless and until settlement is made in respect of vested PSUs in accordance with the provisions hereof and the Participant has become the holder of record of the vested shares of Common Stock issuable hereunder.

9. Governing Law. All questions concerning the construction, validity and interpretation of this Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without regard to the choice of law principles thereof.

10. Securities Representations. This Agreement is being entered into by the Company in reliance upon the following express representations and warranties of the Participant. The Participant hereby acknowledges, represents and warrants that:

(a) The Participant has been advised that the Participant may be an “affiliate” within the meaning of Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”) and in this connection the Company is relying in part on the Participant’s representations set forth in this Section 10.

 

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(b) If the Participant is deemed an affiliate within the meaning of Rule 144 of the Securities Act, the shares of Common Stock issuable hereunder must be held indefinitely unless an exemption from any applicable resale restrictions is available or the Company files an additional registration statement (or a “re-offer prospectus”) with regard to such shares of Common Stock and the Company is under no obligation to register such shares of Common Stock (or to file a “re-offer prospectus”).

(c) If the Participant is deemed an affiliate within the meaning of Rule 144 of the Securities Act, the Participant understands that (i) the exemption from registration under Rule 144 will not be available unless (A) a public trading market then exists for the Common Stock of the Company, (B) adequate information concerning the Company is then available to the public, and (C) other terms and conditions of Rule 144 or any exemption therefrom are complied with, and (ii) any sale of the shares of Common Stock issuable hereunder may be made only in limited amounts in accordance with the terms and conditions of Rule 144 or any exemption therefrom.

11. Withholding of Tax. Unless a Participant elects otherwise at least 15 days in advance of the date any shares of Common Stock are delivered to the Participant, the Company shall have the power and the right to deduct or withhold a sufficient number of shares of Common Stock in order to satisfy any federal, state, local and foreign taxes of any kind (including, but not limited to, the Participant’s FICA and SDI obligations). The Company will determine the precise amount to withhold based upon the market value of the Shares on the date of vesting (i.e., closing price on the business day prior to the date of vesting) at required withholding tax rates, which the Company, in its sole discretion, deems necessary to be withheld or remitted to comply with the Code and/or any other applicable law, rule or regulation with respect to the PSUs.

12. Entire Agreement; Amendment. This Agreement, together with the Plan, contains the entire agreement between the parties hereto with respect to the subject matter contained herein, and supersedes all prior agreements or prior understandings, whether written or oral, between the parties relating to such subject matter. The Committee shall have the right, in its sole discretion, to modify or amend this Agreement from time to time in accordance with and as provided in the Plan. This Agreement may also be modified or amended by a writing signed by both the Company and the Participant. The Company shall give written notice to the Participant of any such modification or amendment of this Agreement as soon as practicable after the adoption thereof.

13. Notices. Any notice hereunder by the Participant shall be given to the Company in writing and such notice shall be deemed duly given only upon receipt thereof by the General Counsel, the Senior Vice President of Human Resources, or any other person designated by the Committee. Any notice hereunder by the Company shall be given to the Participant in writing and such notice shall be deemed duly given upon receipt at such address as the Participant has on file with the Company.

 

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14. No Right to Service. Nothing in this Agreement modifies in any way the right of the Company or its Subsidiaries to terminate the Participant’s employment at any time, for any reason and with or without Cause.

15. Transfer of Personal Data. The Participant authorizes and consents to the transmission by the Company (or any Subsidiary) of any personal data information related to the PSUs awarded under this Agreement for legitimate business purposes. This authorization and consent is freely given by the Participant.

16. Compliance with Laws. The grant of PSUs and the issuance of shares of Common Stock hereunder shall be subject to, and shall comply with, any applicable requirements of any foreign and U.S. federal and state securities laws, rules and regulations (including, without limitation, the provisions of the Securities Act, the Exchange Act and in each case any respective rules and regulations promulgated thereunder) and any other law, rule regulation or exchange requirement applicable thereto. The Company shall not be obligated to issue the PSUs or any shares of Common Stock pursuant to this Agreement if any such issuance would violate any such requirements. As a condition to the settlement of the PSUs, the Company may require the Participant to satisfy any qualifications that may be necessary or appropriate to evidence compliance with any applicable law or regulation.

17. Section 409A. Notwithstanding anything herein or in the Plan to the contrary, the PSUs are intended to be exempt from the applicable requirements of Section 409A of the Code and shall be limited, construed and interpreted in accordance with such intent as is reasonable under the circumstances.

18. Certain Adjustments. The Participant’s rights with respect to the PSUs shall in all events be subject to (i) any right that the Company may have under any Company recoupment policy or other similar agreement or arrangement with a Participant, or (ii) any right or obligation that the Company may have regarding the clawback of “incentive-based compensation” under Section 10D of the Exchange Act and any applicable rules and regulations promulgated thereunder from time to time by the U.S. Securities and Exchange Commission.

19. Binding Agreement; Assignment. This Agreement shall inure to the benefit of, be binding upon, and be enforceable by the Company and its successors and assigns. The Participant shall not assign (except in accordance with Section 8 hereof) any part of this Agreement without the prior express written consent of the Company.

20. Headings. The titles and headings of the various sections of this Agreement have been inserted for convenience of reference only and shall not be deemed to be a part of this Agreement.

21. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which shall constitute one and the same instrument.

22. Further Assurances. Each party hereto shall do and perform (or shall cause to be done and performed) all such further acts and shall execute and deliver all such other agreements, certificates, instruments and documents as either party hereto reasonably may request in order to carry out the intent and accomplish the purposes of this Agreement and the Plan and the consummation of the transactions contemplated thereunder.

 

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23. Severability. The invalidity or unenforceability of any provisions of this Agreement in any jurisdiction shall not affect the validity, legality or enforceability of the remainder of this Agreement in such jurisdiction or the validity, legality or enforceability of any provision of this Agreement in any other jurisdiction, it being intended that all rights and obligations of the parties hereunder shall be enforceable to the fullest extent permitted by law.

24. Acquired Rights. The Participant acknowledges and agrees that: (a) the Company may terminate or amend the Plan at any time, subject to the limitations contained in the Plan or this Agreement; (b) the grant of PSUs made under this Agreement is completely independent of any other award or grant and is made at the sole discretion of the Company; (c) no past grants or awards (including, without limitation, the PSUs granted hereunder) give the Participant any right to any grants or awards in the future whatsoever; and (d) any benefits granted under this Agreement are not part of the Participant’s ordinary salary, and shall not be considered as part of such salary in the event of severance, redundancy or resignation.

*  *  *  *  *

 

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first written above.

 

Signature Page to TSR Performance Stock Unit Agreement

Exhibit 10.2

RESTRICTED STOCK GRANT AGREEMENT

June 22, 2015

Matthew Carter, Jr.

5194 Rancho Verde Trail

San Diego, CA 92130

 

Re:

Inteliquent, Inc. Grant of Restricted Stock

Dear Mr. Carter:

Inteliquent, Inc. (the “Company”) is pleased to advise you that, pursuant to the Company’s Amended and Restated 2007 Equity Incentive Plan (the “Plan”), the Company’s Board of Directors has approved the issuance of shares of the Company’s Common Stock, par value $0.001 per share, to you as set forth below (the “Restricted Shares”), subject to the terms and conditions set forth herein. Upon payment to the Company by you of the aggregate par value thereof, which payment shall be made promptly after the date hereof, the Restricted Shares shall be fully paid and nonassessable. Capitalized terms used herein but not defined herein shall have the meanings ascribed to such terms in the Plan.

 

Original Grant Date:		June 22, 2015
Total Number of Restricted Shares:		16,874
Vesting Dates and Number of Restricted Shares that shall vest:		1⁄4 of the Restricted Shares vest on June 22, 2016 (the first anniversary of the Original Grant Date); the remaining three quarters of the Restricted Shares vest equally on an annual basis on the second, third and fourth anniversary of the Original Grant Date.

Notwithstanding the vesting dates set forth above, if (1) a Change in Control (as defined in your employment agreement with the Company) occurs and your employment is not terminated, 50% of any unvested Restricted Shares will vest upon the Change in Control or (2) your employment is terminated without Cause (as defined in your employment agreement with the Company) or by

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you for Good Reason (as defined in your employment agreement) and not in connection with a Change in Control, any unvested Restricted Shares that would have vested within six months of the date of termination will become fully vested. In the event your employment is terminated by the Company without Cause (as defined in your employment agreement) within twelve (12) months following or one (1) month prior to a Change of Control, 100% of any unvested Restricted Shares will vest upon termination.

1. Conformity with Plan. The grant of Restricted Shares is intended to conform in all respects with, and is subject to all applicable provisions of, the Plan (which is incorporated herein by reference). Inconsistencies between this Agreement and the Plan shall be resolved in accordance with the terms of the Plan. By executing and returning the enclosed copy of this Agreement, you acknowledge your receipt of this Agreement and the Plan and agree to be bound by all of the terms of this Agreement and the Plan. Notwithstanding the foregoing, (a) you will not be considered to have engaged in “Competition” as defined in the Plan unless you have breached the provisions of Section 4.2 of your employment agreement, and (b) the determination of whether you have engaged in Competition, or the reason for the termination of your employment, shall be determined in accordance with the provisions of your employment agreement.

2. Rights of Participants. Nothing in the Agreement or in any grant thereunder shall confer any right on a participant to continue in the service or employ as a director or officer of or in the performance of services for the Company or a Subsidiary or shall interfere in any way with the right of the Company or a Subsidiary to terminate the employment or performance of services or to reduce the compensation or responsibilities of a participant at any time.

3. Remedies. The parties hereto shall be entitled to enforce their rights under this Agreement specifically, to recover damages by reason of any breach of any provision of this Agreement and to exercise all other rights existing in their favor. The parties hereto acknowledge and agree that money damages would not be an adequate remedy for any breach of the provisions of this Agreement and that any party hereto may, in its sole discretion, apply to any court of law or equity of competent jurisdiction for specific performance and/or injunctive relief (without posting bond or other security) in order to enforce or prevent any violation of the provisions of this Agreement.

4. Successors and Assigns. Except as otherwise expressly provided herein, all covenants and agreements contained in this Agreement by or on behalf of any of the parties hereto shall bind and inure to the benefit of the respective successors and permitted assigns of the parties hereto whether so expressed or not.

5. Severability. Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this Agreement.

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6. Counterparts. This Agreement may be executed in counterparts, each of which shall constitute an original, but all of which taken together shall constitute one and the same Agreement. Signatures exchanged electronically (such as a PDF) will be treated for all purposes as original signatures.

7. Descriptive Headings. The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement.

8. Governing Law. THE VALIDITY, CONSTRUCTION, INTERPRETATION, ADMINISTRATION AND EFFECT OF THE PLAN, AND OF ITS RULES AND REGULATIONS, AND RIGHTS RELATING TO THE PLAN AND TO THIS AGREEMENT, SHALL BE GOVERNED BY THE SUBSTANTIVE LAWS, BUT NOT THE CHOICE OF LAW RULES, OF THE STATE OF DELAWARE.

9. Notices. All notices, demands or other communications to be given or delivered under or by reason of the provisions of this Agreement shall be in writing and shall be deemed to have been given when delivered personally or mailed by certified or registered mail, return receipt requested and postage prepaid, to the recipient. Such notices, demands and other communications shall be sent to you at the address appearing on the first page of this Agreement and to the Company at Inteliquent, Inc., 550 West Adams Street, Suite 900, Chicago, Illinois 60661, Attn: Chief Financial Officer, or to such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party.

10. Entire Agreement. This Agreement and the terms of the Plan constitute the entire understanding between you and the Company, and supersede all other agreements, whether written or oral, with respect to your Restricted Shares.

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Please execute the extra copy of this Agreement in the space below and return it to the Chief Financial Officer at Inteliquent, Inc. to confirm your understanding and acceptance of the agreements contained in this Agreement.

 

 

Enclosures:		Extra copy of this Agreement     Copy of the Plan

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The undersigned hereby acknowledges having read this Agreement and the Plan and hereby agrees to be bound by all provisions set forth herein and in the Plan.

Dated as of June 22, 2015

 

Exhibit 10.3

NON-QUALIFIED STOCK

OPTION AWARD AGREEMENT

 

Date:		June 22, 2015
Re:		Grant of Non-Qualified Stock Option
To:		Matthew Carter, Jr.

Inteliquent Inc. (the “Company”) is pleased to advise you that, pursuant to the Company’s Amended and Restated 2007 Equity Incentive Plan (the “Plan”), the Committee has granted to you an option (the “Option”) to acquire shares of Common Stock, as set forth below, subject to the terms and conditions set forth herein:

 

Number of Option Shares:		46,467
Date of Grant:		June 22, 2015
Exercise Price per Option Share:		$18.52
Vesting Amount and Dates of Option Shares:		1⁄4 at June 22, 2016; the remaining three quarters of the Option vesting equally on an annual basis on the second, third and fourth anniversary following June 22, 2016.
Expiration Date of All Option Shares:		06/22/2025

Any capitalized terms used herein and not defined herein have the meaning set forth in the Plan.

1. Option.

(a) Term. Subject to the terms and conditions set forth herein, the Company hereby grants to you (or such other persons as permitted by paragraph 5) an Option to purchase the Option Shares at the exercise price per Option Share set forth above in the introductory paragraph of this letter agreement (the “Exercise Price”), payable upon exercise as set forth in paragraph 1(b) below. The Option shall expire at the close of business on the date set forth above in the introductory paragraph of this letter agreement (the “Expiration Date”), which is the tenth anniversary of the date of grant set forth above in the introductory paragraph of this letter agreement (the “Grant Date”), subject to earlier expiration as provided under the Plan should your employment or service with the Company or a Subsidiary terminate. The Exercise Price and the number and kind of shares of Common Stock or other property for which the Option may be exercised shall be subject to adjustment as provided under the Plan. For purposes of this letter agreement, “Option Shares” mean (i) all shares of Common Stock issued or issuable upon the exercise of the Option and (ii) all shares of Common Stock issued with respect to the Common Stock referred to in clause (i) above by way of stock dividend or stock split or in connection with any conversion, merger, consolidation or recapitalization or other reorganization affecting the Common Stock.

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(b) Payment of Option Price. Subject to paragraph 2 below, the Option may be exercised in whole or in part upon payment of an amount (the “Option Price”) equal to the product of (i) the Exercise Price and (ii) the number of Option Shares to be acquired. Payment of the Option Price shall be made as provided under the Plan.

2. Exercisability/Vesting and Expiration.

(a) Normal Vesting. The Option granted hereunder may be exercised only to the extent it has become vested. The Option shall vest in as indicated by the vesting dates of Option Shares set forth in the introductory paragraph of this letter agreement.

(b) Normal Expiration. In no event shall any part of the Option be exercisable after the Expiration Date.

(c) Effect on Vesting and Expiration of Employment Termination. Notwithstanding paragraphs 2(a) and (b) above, the special vesting and expiration rules set forth in the Plan shall apply if your employment or service with the Company or a Subsidiary terminates prior to the Option becoming fully vested and/or prior to the Expiration Date.

(d) Effect on Vesting of Certain Events. Notwithstanding paragraphs 2(a), (b) and (c) above, if (1) a Change in Control (as defined in your employment agreement with the Company) occurs and your employment is not terminated, 50% of any unvested options will vest upon the Change in Control or (2) your employment is terminated without Cause (as defined in your employment agreement with the Company) or for Good Reason (as defined in your employment agreement) and not in connection with a Change in Control, any unvested options that would have vested within six months of the date of termination will become fully vested. In the event your employment is terminated by the Company without Cause (as defined in your employment agreement) within twelve (12) months following or one (1) month prior to a Change of Control, 100% of any unvested Options will vest upon termination.

3. Procedure for Exercise. You may exercise all or any portion of the Option, to the extent it has vested and is outstanding, at any time and from time to time prior to the Expiration Date, by delivering written notice to the Company in the form attached hereto as Exhibit A, together with payment of the Option Price in accordance with the provisions set forth in the Plan. The Option may not be exercised for a fraction of an Option Share.

4. Withholding of Taxes.

(a) Participant Election. Unless otherwise determined by the Committee, you may elect to deliver shares of Common Stock (or have the Company withhold Option Shares acquired upon exercise of the Option) to satisfy, in whole or in part, the amount the Company is required to withhold for taxes in connection with the exercise of the Option. Such election must be made on or before the date the amount of tax to be withheld is determined. Once made, the election shall be irrevocable. The fair market value of the shares to be withheld or delivered will be the Fair Market Value as of the date the amount of tax to be withheld is determined.

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(b) Company Requirement. The Company, to the extent permitted or required by law, shall have the right to deduct from any payment of any kind (including salary or bonus) otherwise due to you, an amount equal to any federal, state or local taxes of any kind required by law to be withheld with respect to the delivery of Option Shares under this letter agreement.

5. Transferability of Option. You may transfer the Option granted hereunder only by will or the laws of descent and distribution or to any of your Family Members by gift or a qualified domestic relations order as defined by the Code. Unless the context requires otherwise, references herein to you are deemed to include any permitted transferee under this paragraph 5. The Option may be exercised only by you; by your Family Member if such person has acquired the Option by gift or qualified domestic relations order; by the executor or administrator of the estate of any of the foregoing or any person to whom the Option is transferred by will or the laws of descent and distribution; or by the guardian or representative of any of the foregoing; provided that Incentive Stock Options may be exercised by any guardian or legal representative only if permitted by the Code and any regulations thereunder.

6. Conformity with Plan. The Option is intended to conform in all respects with, and is subject to all applicable provisions of, the Plan (which is incorporated herein by reference). Inconsistencies between this letter agreement and the Plan shall be resolved in accordance with the terms of the Plan. By executing and returning the enclosed copy of this letter agreement, you acknowledge your receipt of this letter agreement and the Plan and agree to be bound by all of the terms of this letter agreement and the Plan. Notwithstanding the foregoing, (a) you will not be considered to have engaged in “Competition” as defined in the Plan unless you have breached the provisions of Section 4.2 of your employment agreement, and (b) the determination of whether you have engaged in Competition, or the reason for the termination of your employment, shall be determined in accordance with the provisions of your employment agreement.

7. Rights of Participants. Nothing in this letter agreement shall interfere with or limit in any way the right of the Company to terminate your employment or other performance of services at any time (with or without Cause), nor confer upon you any right to continue in the employ or as a director or officer of, or in the performance of other services for, the Company or a Subsidiary for any period of time, or to continue your present (or any other) rate of compensation or level of responsibility. Nothing in this letter agreement shall confer upon you any right to be selected again as a Plan participant.

8. Amendment or Substitution of Option. The terms of the Option may be amended from time to time by the Committee in its discretion in any manner that it deems appropriate (including, but not limited to, acceleration of the date of exercise of the Option); provided that no such amendment shall adversely affect in a material manner any of your rights under the award without your written consent.

9. Successors and Assigns. Except as otherwise expressly provided herein, all covenants and agreements contained in this letter agreement by or on behalf of any of the parties hereto shall bind and inure to the benefit of the respective successors and permitted assigns of the parties hereto whether so expressed or not.

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10. Severability. Whenever possible, each provision of this letter agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this letter agreement is held to be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of this letter agreement.

11. Counterparts. This letter agreement may be executed simultaneously in two or more counterparts, each of which shall constitute an original, but all of which taken together shall constitute one and the same letter agreement.

12. Descriptive Headings. The descriptive headings of this Agreement are inserted for convenience only and do not constitute a part of this Agreement.

13. Governing Law. THE VALIDITY, CONSTRUCTION, INTERPRETATION, ADMINISTRATION AND EFFECT OF THE PLAN, AND OF ITS RULES AND REGULATIONS, AND RIGHTS RELATING TO THE PLAN AND TO THIS LETTER AGREEMENT, SHALL BE GOVERNED BY THE SUBSTANTIVE LAWS, BUT NOT THE CHOICE OF LAW RULES, OF THE STATE OF DELAWARE.

14. Notices. All notices, demands or other communications to be given or delivered under or by reason of the provisions of this letter agreement shall be in writing and shall be deemed to have been given when (i) delivered personally, (ii) mailed by certified or registered mail, return receipt requested and postage prepaid, (iii) sent by facsimile or (iv) sent by reputable overnight courier, to the recipient. Such notices, demands and other communications shall be sent to you at the address specified in this letter agreement and to the Company at Inteliquent, Inc., 550 West Adams Street, Suite 900, Chicago, Illinois 60661, Attn: Legal Department, or to such other address or to the attention of such other person as the recipient party has specified by prior written notice to the sending party.

15. Entire Agreement. This letter agreement and the terms of the Plan constitute the entire understanding between you and the Company, and supersede all other agreements, whether written or oral, with respect to your acquisition of the Option Shares.

*    *    *    *    *

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Signature Page to Stock Option Award Agreement

Please execute the extra copy of this letter agreement in the space below and return it to the Company to confirm your understanding and acceptance of the agreements contained in this letter agreement.

 

 

Enclosures:		Extracopy of this letter agreement Copy of the Plan

The undersigned hereby acknowledges having read this letter agreement and the Plan and hereby agrees to be bound by all provisions set forth herein and in the Plan.

 

Dated as of: June 22, 2015

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EXHIBIT A

Form of Letter to be Used to Exercise Stock Option

 

                

Date

 

Attention:                                                                         

I wish to exercise the stock option granted on              and evidenced by a Stock Option Award Agreement dated as of             , to acquire              shares of Common Stock of              , at an option price of $            per share. In accordance with the provisions of paragraph 1 of the Stock Option Award Agreement, I wish to make payment of the exercise price (please check all that apply):

 

		¨   in cash
		¨   by delivery of shares of Common Stock held by me
		¨   by simultaneous sale through a broker

Please issue a certificate for these shares in the following name:

 

Name

Address

 

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