Class B Incentive Units Clause Samples
The Class B Incentive Units clause defines a specific class of equity interests granted to individuals, typically employees or service providers, as a form of incentive compensation. These units often vest over time or upon achieving certain performance milestones, and may entitle holders to a share of company profits or appreciation in value, but usually with limited or no voting rights. The core function of this clause is to align the interests of key contributors with the long-term success of the company, incentivizing performance while managing dilution and control for existing owners.
Class B Incentive Units. The Company is authorized to grant awards (each, a “Company Incentive Award”) that consist of an aggregate number of Class B Incentive Units representing 5% of the total outstanding Capital Proceeds Equity Interests of the Company as of the Effective Date (the “Pre-Approved Class B Issuance”) or such greater amount of Class B Incentive Units, if any, as may be determined by the Executive Committee, subject to approval of the NSAM Designees (to the extent required) in accordance with Section 5.3(h), directly or indirectly, to employees and other service providers of the Company or any of its Subsidiaries (other than the Principals unless approved in accordance with Section 5.3(h), to the extent such approval is required), which Class B Incentive Units will have the rights and obligations set forth herein and will be subject to the terms of the Incentive Unit Plan and the Award Agreements contemplated thereby; provided, that such Award Agreements comply with the provisions of this Agreement. During any Fiscal Year, the Executive Committee shall be permitted to distribute up to 20% of the Pre-Approved Class B Issuance to employees and other service providers of the Company or its Subsidiaries, subject to minimum vesting requirements of at least two years (the “Annual Permitted Class B Issuance”), or such greater amount of Class B Incentive Units, if any, as may be approved by the Executive Committee, subject to approval of the NSAM Designees (to the extent required) in accordance with Section 5.3(h); provided, that if all or any portion of the Annual Permitted Class B Issuance is not distributed in any Fiscal Year, such undistributed amount shall be available for distributions in subsequent Fiscal Years, and the Annual Permitted Class B Issuance shall be increased to reflect such undistributed amount; provided, further, that in no event may any employee or other service provider of the Company or its Subsidiaries receive Class B Incentive Units representing more than 2.5% of the total outstanding Capital Proceeds Equity Interests of the Company without the consent of the Executive Committee subject to the approval of the NSAM Designees (to the extent required) in accordance with Section 5.3(d). Any Company Incentive Award may be granted in consideration for services provided or to be provided by the recipient of such award and such consideration need not reflect the Fair Market Value of the additional Units that are the subject of such award. The Class B Ince...
Class B Incentive Units. As of the Effective Date, no Class B Incentive Units have been issued.
Class B Incentive Units. 10,000 Class B Incentive Units are authorized for issuance to employees, consultants and investors in the Company, as well as other entities (the “Class B Incentive Units”). As of the date of this Agreement, no Class B Incentive Units have been issued. It is contemplated that, if and when issued, the Class B Incentive Units shall:
(i) be non-voting Units of Membership Interests;
(ii) may be subject to time vesting over a period time and subject to a risk of forfeiture if any recipient resigns, is terminated for cause or otherwise breaches such Person’s employment or consulting agreement with the Company; and
(iii) be subject to performance vesting based on the Company’s achievement of certain financial performance milestones to be set forth in the Equity Inventive Plan and/or in any award agreement granting Class B Incentive Units to a Person.