CONFIDENTIAL DRAFT
EXHIBIT 10.11
AMENDED AND RESTATED
PENSKE AUTOMOTIVE GROUP, INC.
NON-EMPLOYEE DIRECTOR COMPENSATION PLAN
OCTOBER 25, 2007
I. INTRODUCTION AND DEFINITIONS
A. Purpose. The purpose of this Plan is to promote the interests of
Penske Automotive Group, Inc. and its affiliates and stockholders by
helping to attract and retain highly qualified non-employee directors.
This Plan amends and restates the Amended and Restated United Auto
Group, Inc. Non-Employee Director Compensation Plan adopted by the
Board of Directors on December 10, 2003 and previously amended and
restated as of October 20, 2004.
B. Definitions. Unless the context clearly indicates otherwise, the
following terms, when used in the Plan, shall have the meanings set
forth in this section:
1. "Board" shall mean the Board of Directors of the Company.
2. "Code" shall mean the Internal Revenue Code of 1986, as amended.
3. "Company" shall mean Penske Automotive Group, Inc., a Delaware
corporation, and any successor corporation.
4. "Director" shall mean a member of the Board.
5. "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
6. "Non-Employee Director" shall mean a Director who is not also a
salaried employee of the Company or any of its subsidiaries.
7. "Payment Date" shall mean a date selected by the Board which
falls within the first quarter of the calendar year following the
calendar year in which a Non-Employee Director served on the
Board.
8. "Plan" shall mean this Amended and Restated Penske Automotive
Group, Inc. Non-Employee Director Compensation Plan, as set forth
herein and as it may be amended from time to time.
9. "Stock" shall mean shares of the Voting Common Stock of the
Company, par value $0.0001 per share.
10. "Termination of Service" means a Non-Employee Director's
separation from service as defined under Section 409A of the
Code.
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II. NON-EMPLOYEE DIRECTOR FEES
A. Fee. Each Non-Employee Director shall be paid for each year or partial
year of service a fee of $40,000 or, in the event the Director is a
member of the Audit Committee of the Board, $45,000 (pro rated for
partial years) (the "Fee"). The Fee may reduced, increased or
otherwise amended from time to time by the Board and all references to
the Fee shall include such amounts as so amended.
B. Manner of Payment. The Non-Employee Director must annually elect in
advance whether to receive the Fee in the form of cash or Stock. This
election must be received by the Company on or before December 31 (the
"Election Date") of the preceding year. Once made, this election is
irrevocable for such year.
C. Payment Date. That portion of the Fee not deferred shall be paid on
the Payment Date. If a Non-Employee Director fails to elect the manner
of payment of the Fee by the Election Date, or if a Non-Employee
Director's election to receive the Fee in Stock has not been
previously approved by the Board, then that Non-Employee Director's
Fee shall be payable in Cash.
D. Election to Receive Fee in Stock
1. A Non-Employee Director's election to receive the Fee in Stock
must be approved by the Board prior to the Payment Date.
2. If a Non-Employee Director's election is approved by the Board,
then the Non-Employee Director's Fee, if not deferred, shall be
paid in shares of Stock or, if deferred, then payable in Units,
the number of which will be determined as follows: by dividing
the Fee, (or the prorated portion for partial years) by the
average of the closing market price of the Stock as reported on
the New York Stock Exchange for the 20 trading days immediately
preceding and including the Payment Date.
3. Such shares of Stock shall not be subject to any transfer or
resale restrictions other than those applicable under federal and
state securities laws.
4. If a Non-Employee Director becomes a member of the Board after
the Election Date, then such Director may elect to receive the
Fee in the form of Stock on the Payment Date by making such
election within 30 days after becoming a Director, provided that
such election shall be subject to approval by the Board.
III. DEFERRAL OF NON-EMPLOYEE DIRECTOR FEE.
A. Introduction: Non-Employee Directors, on an individual basis, may
defer all or part of their Fee until such time as their service on the
Board terminates.
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B. Manner of Deferral: On or before the Election Date, a Non-Employee
Director may elect to defer all or a portion of the Fee (the "Deferred
Fee"); provided, that a Non-Employee Director who first commences
service on the Board during the course of a calendar year, rather than
prior to such year, may make such election to defer with respect to
such year not later than the 30th day following the date on which the
Non-Employee Director first commences service, and such deferral
election shall be effective with regard to Fees earned during such
year. Such election shall be irrevocable for the period of service for
which the Fee is payable. The Deferred Fee will be credited to the
Non-Employee Director's deferred fees account (the "Deferred Fees
Account") as of the Payment Date and accounted for pursuant to the
manner of payment elected by the Non-Employee Director until fully
paid out.
C. Deferral of Stock: If a Non-Employee Director elects to receive the
Fee in Stock, the payment of which has been deferred in whole or in
part, then the Non-Employee Director's Deferred Fees Account will be
credited with the number of stock units ("Units"), calculated to the
nearest thousandths of a Unit, determined by dividing the amount of
the Deferred Fee by the average of the closing market price of the
Stock as reported on the New York Stock Exchange for the 20 trading
days immediately preceding and including the Payment Date. The
Non-Employee Director's Deferred Fees Account will also be credited
with the number of Units determined by multiplying the number of Units
in the Non-Employee Director's Deferred Fees Account by any per share
cash dividends declared by the Company on its Stock and dividing the
product by the closing market price of the Stock as reported on the
New York Stock Exchange on the related dividend payment date, and also
by multiplying the number of Units in the Non-Employee Director's
Deferred Fees Account by any stock dividends declared by the Company
on its Stock.
D. Deferral of Cash: If a Non-Employee Director elects to receive the Fee
in cash, the payment of which has been deferred in whole or in part,
then the Non-Employee Director's Deferred Fees Account (a) will be
credited on the Payment Date in an amount equal to the Deferred Fee,
and (b) will be credited as of the end of each calendar quarter
additional compensation equal to interest on the amounts credited to
such account from the date credited (or the end of the preceding
quarter, if later) to the end of such quarter at the rate of interest
payable on the last issue of U.S. 90-day Treasury Bills made prior to
the end of such quarter, as published in the Wall Street Journal.
E. Recapitalization: If, as a result of a recapitalization of the Company
(including stock splits), the Company's outstanding shares of Stock
shall be changed into a greater or smaller number of shares, the
number of Units credited to a Non-Employee Director's Deferred Fees
Account shall be appropriately adjusted on the same basis.
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F. Distribution of Deferred Fees.
1. Upon a Non-Employee Director's Termination of Service, the
Non-Employee Director shall receive the amount credited to his
Deferred Fees Account in five substantially equal annual installments
commencing on the first Payment Date following the Non-Employee
Director's Termination of Service (the "Installment Payment Date"),
unless prior to the time specified in Section III.B, the Non-Employee
Director requests distributions in a different time or form.
2. Survivor Payout Elections. In the event of a Non-Employee Director's
death prior to receiving all entitled deferred payments, the value of
the Deferred Fees Account on the date of the Non-Employee Director's
death shall be determined and paid to the beneficiary(s) designated by
the Non-Employee Director (or, failing such designation, to the
Non-Employee Director's estate) in accordance with the installment
schedule set forth in Section III, F(1) above, unless the Non-Employee
Director, prior to time specified in Section III.B, has elected to
have the remaining payments made in a single lump sum upon his death,
in which case a lump sum payment will be made to the designated
beneficiaries or the Non-Employee Director's estate as soon as
practicable after the Non-Employee Director's death.
3. Form of Payment Elections.
(a) All installment payments from the Non-Employee Director's
Deferred Fees Account shall be in the form of cash.
(b) Notwithstanding the preceding paragraph, upon request of the
Non-Employee Director, and subject to the Board's approval, a
Non-Employee Director, former Non-Employee Director, or deceased
Non-Employee Director's beneficiary or legal representative may
elect at anytime to have any or all payouts, or remaining
payouts, of the Non-Employee Director's Deferred Fees Account
paid out in cash or in shares of the Stock.
4. Determination of Amount of Cash Installment Payments.
(a) The amount of the first cash installment payment shall be a
fraction of the Cash and/or Units in the Non-Employee Director's
Deferred Fees Account on the first Installment Payment Date, the
numerator of which is one and the denominator of which is the
total number of installments elected. Each subsequent installment
shall be calculated in the same manner as of each subsequent
Installment Payment Date except that the denominator shall be
reduced by the number of installments which have been previously
paid.
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(b) The amount of cash payable for deferred fees accounted for as
Units based on the Company's Stock value will be paid as
described above, based on the number of Units in the Non-Employee
Director's Deferred Fees Account on the Installment Payment Date
multiplied by the closing market price of the Company's Stock as
reported on the New York Stock Exchange on the last trading day
preceding the Installment Payment Date.
5. Determination of Amount of Installment Payments in Shares of Stock.
(a) The amount of the first installment payment payable in shares of
the Stock for deferred fees shall be a fraction of the value of
the Cash and/or Units in the Non-Employee Director's Deferred
Fees Account on the date of the first Installment Payment Date,
the numerator of which is one and the denominator of which is the
total number of installments elected. Each subsequent installment
shall be calculated in the same manner as of each subsequent
Installment Payment Date except that the denominator shall be
reduced by the number of installments which have been previously
paid.
(b) If a payout to be made in shares of the Stock is based on
deferred fees accounted for as Cash, the number of shares payable
shall be determined by dividing the amount of cash that would
otherwise be payable by the closing market price of the Stock as
reported on the New York Stock Exchange on the last trading day
preceding the Installment Payment Date.
(c) Except for the final installment payment, only whole shares shall
be payable, and the value of any fractional share payable shall
re retained in the Non-Employee Director's Deferred Fees Account
until the final installment payment, at which time the value of
any fractional share payable shall be paid in cash, based on the
fractional share multiplied by the closing market price of Stock
as reported on the New York Stock Exchange on the last trading
day preceding the Installment Payment Date.
6. Six-Month Delay In Certain Payments. Notwithstanding the provisions of
this Section III, F.1, if a Non-Employee Director is a specified
employee (within the meaning of Section 409A of the Code) with respect
to the Company at the time of his or her Termination of Service, all
payments that would have been due during the six-month period
following the Non-Employee Director's Termination of Service shall be
paid on the first day of the seventh month following the Non-Employee
Director's Termination of Service (or, if earlier, as soon as
practicable after the date of the Participant's death).
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IV. GENERAL TERMS
A. Unfunded Plan. It is presently intended that the fund constitute an
unfunded plan for deferred compensation. No provision of the Plan
shall require the Company, for the purpose of satisfying any
obligations under the Plan, to purchase units or place any units in a
trust or other entity to which contributions are made or otherwise to
segregate any assets, nor shall the Company maintain separate bank
accounts, books, records, or other evidence of the existence of a
segregated or separately maintained or administered fund for such
purposes.
B. Effective Date. The Amended and Restated Compensation Plan shall be
effective upon approval by the Board.
C. Amendment and Termination of the Plan. The Board in its discretion may
terminate the Plan or alter or amend the Plan or any part thereof from
time to time.
D. Rule 16b-3. The terms and conditions of each grant of a Stock or Units
under the Plan shall be approved in advance by the Board for purposes
of the exemption from Section 16(b) of the Exchange Act available
under Rule 16b-3(d)(1) and other applicable rules promulgated under
Section 16 the Exchange Act.
E. Nonassignability. It shall be a condition of this Plan (and all rights
of each Non-Employee Director and beneficiary shall be subject
thereto) that no amount payable hereunder shall be assignable in whole
or in part, either directly or by operation of law except by will or
the laws of descent or distribution. Further, no right or interest of
each Non-Employee Director or beneficiary under the Plan shall be
liable for, or subject to, any obligation or liability of such
director or beneficiary, including claims for alimony or the support
of any spouse.
F. Section 409A of the Code. To the extent applicable, it is intended
that this Plan comply with the provisions of Section 409A of the Code.
The Plan shall be interpreted and administered in a manner consistent
with this intent.
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FORM OF NOTICE OF ELECTION FOR FORM OF PAYMENT FOR
NON-EMPLOYEE DIRECTOR SERVICES
TO: (Input Director's Name and Address)
I. MANNER OF PAYMENT ELECTION
Pursuant to the United Auto Group, Inc.'s Non-Employee Director
Compensation Plan, for the annual fees payable to me as a Director of the
Company for the year ending December 31, 2003, I hereby irrevocably elect:
[ ] To receive shares of United Auto Group, Inc. Voting Common Stock, par value
$0.0001 per share, in lieu of cash in payment of the annual fee. The shares
should be issued according to instructions set forth below; or
[ ] Cash in payment of the annual fee.
II. DEFERRAL OPTION ELECTION
Pursuant to the United Auto Group, Inc.'s Non-Employee Compensation Plan, I
hereby irrevocably elect to defer the amount of the annual fee payable to me as
Director of the Company for the year ended December 31, 2003, as follows:
___% of, or $___ of my annual fee.
The amount or percentage of the annual fee deferred shall be in the manner
of payment elected in Section I.
III. BENEFICIARY
A. If my membership on the Company's Board of Directors is terminated by
death, or if I shall die after I cease to serve as a Director but
before complete distribution of my Deferred Fees Account, I direct the
balance in such account to be paid to:
----------------------------------------
Name of Designated Beneficiary
----------------------------------------
Address
----------------------------------------
Relationship to Me
___________, 20__ ----------------------------------------
Date Director
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B. If my membership on the Company's Board of Directors is terminated by
death, or if I shall die after I cease to serve as a Director but
before complete distribution of my Deferred Fees Account, I direct the
balance in such account to be paid:
[ ] In one lump sum to the Designated Beneficiary
[ ] In accordance with the Plan's Installment Payment Schedule or the schedule
previously elected by me and approved by the Board.
IV. SPECIAL INSTRUCTIONS
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
V. SIGNATURE
_____________, 20__ ________________________________________
Date Director
Name:
__________________________________
Address:
_______________________________
_______________________________
Social Security Number:
________________
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