EX-10.1 2 exhibit101-xformofperfor.htm EX-10.1
1 GATX CORPORATION 2012 INCENTIVE AWARD PLAN PERFORMANCE SHARE AGREEMENT FOR EXECUTIVE OFFICERS GATX Corporation (the "Company") hereby grants on the Grant Date to the Participant as an incentive to advance the interests of the Company the number of Performance Shares approved by the Administrator, subject to Section 3.1 and Article 5 of the GATX Corporation Amended and Restated 2012 Incentive Award Plan (the “Plan”) and as set forth on the Shareworks website (https://www.shareworks.com) or any successor administrator the Administrator may designate from time to time to administer the Plan and this Agreement (the “Award”). Such grant is expressly subject to the terms and conditions of this Performance Share Agreement (the “Agreement”) as hereinafter set forth and further subject to the terms and conditions of the Plan, both of which are incorporated herein by reference. 1. Defined Terms. Capitalized terms used in this Agreement are defined in paragraph 14 or elsewhere in this Agreement. Capitalized terms used but not defined herein shall have the meanings ascribed thereto in the Plan. 2. Award. Each Performance Share entitles the Participant to receive one share of Common Stock of the Company (each a “Share”) subject to the terms and conditions of this Agreement. This Award is granted in respect of the performance period beginning on January 1, 202[X] through and including December 31, 202[X] (the “Performance Period”). 3. Voting Rights and Dividends. Notwithstanding anything to the contrary, the Participant shall not have any rights as a shareholder of the Company, including the right to vote, until the Participant actually receives Shares in accordance with paragraph 4 of this Agreement. An account shall be established for the Participant, to which shall be credited dividend equivalents equal to the product of (a) the number of the Participant’s Performance Shares and (b) the dividend declared on a single share of Common Stock. To the extent the Participant becomes vested in Performance Shares, the Participant shall be entitled to a distribution of the dividend equivalents credited to his or her account if and when Shares are issued with respect to Performance Shares to which the Participant becomes entitled pursuant to paragraph 4 of this Agreement. All dividend equivalents paid will be considered ordinary income and will be subject to supplemental withholding rates for income tax purposes including payroll taxes, applicable to such supplemental income. 4. Vesting, Transfer and Forfeiture. (a) After the end of the Performance Period, the Committee shall determine the number of the Participant's Performance Shares that have been earned for the Performance Period in accordance with the schedule set forth on Exhibit

2 1, weighted by the percentages set forth in the column captioned “Weight” on Exhibit 2 and calculated in the manner set forth on Exhibit 2 (provided that the determination under this subparagraph 4(a) shall be subject to modification as provided in paragraph 8 hereof). The date of the Committee’s determination being the “Determination Date.” (b) Notwithstanding anything in this Agreement to the contrary that requires delivery and payment of Shares, the Participant may elect, in his or her sole discretion in lieu of Shares, to receive from the Company cash equal to the Fair Market Value of the Shares (as of the Determination Date) that otherwise would be delivered and payable under the terms of this Agreement, provided that the following conditions are met: (i) (A) the Participant is within five years of Normal Retirement Age (age 65) under the GATX Non-Contributory Pension Plan for Salaried Employees as of the last day of the Performance Period; or (B) the Participant satisfies at least 150% of his or her ownership requirement under the Company’s stock retention policy as of the last day of the Performance Period; and (ii) such election is submitted in writing on such form as the Company may specify (the “Cash Election”). The Participant may submit a Cash Election only during any period in which the Participant is allowed to trade in the Company’s Shares under the Company’s insider trading policy, but no later than the Determination Date for the Performance Period. If any of the foregoing conditions are not met, then the election will be void and the Participant shall receive payment under this Agreement in the form of Shares. Otherwise, an election to receive cash in lieu of Shares may not be revoked or changed once made. (c) As soon as practicable after the Determination Date, but not later than March 15 of the year following the end of the Performance Period, a number of Shares equal to the number of Performance Shares that vested pursuant to paragraph 4(a) shall be transferred to the Participant. (d) Except as provided in subparagraph 4(e) below, if the Participant's Date of Termination occurs prior to the end of the Performance Period, the Participant shall forfeit all Performance Shares and rights under this Agreement. (e) Notwithstanding subparagraph 4(d) above, the Participant shall become vested in a number of earned Performance Shares hereunder, and shall become owner of an equal number of Shares in respect thereof, free and clear of all restrictions otherwise imposed by this Agreement, as follows: (i) If the Participant’s employment is involuntarily terminated by the Employer other than for Cause, not less than eighteen (18) months following the beginning of the Performance Period but on or prior to the end of the Performance Period, the Participant will be entitled to

3 a pro rata portion of his or her earned Performance Shares based on the length of his or her employment during the Performance Period. The pro rata portion of the Performance Shares shall equal the product of: (A) the number of Performance Shares to which the Participant would otherwise be entitled as of the Determination Date in accordance with the foregoing provisions of this paragraph 4 had his or her employment not been terminated; and (B) a fraction (not greater than one), the numerator of which is the number of days the Participant was employed by the Company or its Subsidiaries during the period beginning on the date of commencement of the Performance Period and ending on the Date of Termination, and the denominator of which is the number of days in the Performance Period. The Shares to which the Participant is entitled pursuant to this subparagraph 4(e)(i) shall be transferred to the Participant in the year following the end of the Performance Period as soon as practical following the Determination Date, but not later than March 15 of the year following the end of the Performance Period. (ii) If the Participant's Date of Termination occurs by reason of the Participant's death, Retirement or Disability prior to the end of the Performance Period, the Participant will be entitled to receive a pro rata portion of his or her earned Performance Shares based on the length of his or her employment during the Performance Period. The pro rata portion of the Performance Shares shall equal the product of: (A) the number of Performance Shares to which the Participant would otherwise be entitled as of the Determination Date in accordance with the foregoing provisions of this paragraph 4 if no Date of Termination had occurred; and (B) a fraction (not greater than one), the numerator of which is the number of days during the period beginning on the date of commencement of the Performance Period and ending on the date of the Participant’s death, Retirement or Disability, and the denominator of which is the number of days in the Performance Period. Notwithstanding the foregoing, if the Participant’s Date of Termination occurs by reason of the Participant’s death, Retirement or Disability, the Committee may, in its sole discretion, increase the

4 number of Performance Shares to which the Participant is entitled, but in no event will the Participant be entitled to a distribution that is greater than what would have been distributable if no Date of Termination had occurred. The Shares to which the Participant is entitled pursuant to this subparagraph 4(e)(ii) shall be transferred to the Participant in the year following the end of the Performance Period as soon as practical following the Determination Date, but not later than March 15 of the year following the end of the Performance Period. (iii) Subject to the provisions of Section 14.2 of the Plan (relating to the adjustment of Shares), if a Change in Control occurs prior to a Participant's Date of Termination and before the end of the Performance Period and, within two (2) years after the occurrence of the Change in Control, the Participant's Date of Termination occurs by reason of discharge by the Participant's employer without Cause or the Participant resigns from employment with the employer for Good Reason, the Participant shall become vested in all Performance Shares granted under this Agreement prior to the Change in Control that are held by the Participant as of the Date of Termination, in accordance with subparagraphs 4(e)(iv) or 4(e)(v), as applicable. (iv) With respect to any Performance Shares that become vested in connection with a Change in Control described in Subsection 2.7(a), (b), (c) or (d) of the Plan, the number of Shares to which the Participant is entitled upon the vesting of his or her Performance Shares shall be calculated as if the Company had achieved 100% performance against its Performance Goals, and shall be transferred to the Participant as soon as practicable following the Date of Termination, but not later than March 15 of the year following year in which the Date of Termination occurs. Following a distribution in accordance with this subparagraph 4(e)(iv), the Participant shall have no further rights under this Agreement. (v) With respect to any Performance Shares that become vested in connection with a Change in Control described in Subsection 2.7(e) of the Plan, with respect to a Participant as described therein (relating to certain transactions involving a Subsidiary or Business Segment), as soon as practicable following the Date of Termination, the Participant shall receive a distribution of the following number of Shares as soon as practicable following the Date of Termination, but not later than March 15 of the year following year in which the Date of Termination occurs, determined on the assumption that the Company achieved 100% performance against its Performance Goals as follows:

5 (A) If the Date of Termination occurs during the first year of the Performance Period, the Participant shall be entitled to receive Shares equal in number to one-third (1/3) of his or her Performance Shares. (B) If the Date of Termination occurs during the second year of the Performance Period, the Participant shall be entitled to receive Shares equal in number to two-thirds (2/3) of his or her Performance Shares. (C) If a Date of Termination occurs during the third year of the Performance Period, such Participant shall be entitled to receive Shares equal in number to the total of all of his or her Performance Shares. Following a distribution in accordance with this subparagraph 4(d)(v), the Participant shall have no further rights under this Agreement. (vi) For purposes of subparagraphs 4(e)(iii) and 4(e)(v) hereof, if, as a result of a Change in Control described in Subsection 2.7(e) of the Plan, the Participant’s Employer ceases to be a Subsidiary or the Participant’s Employer is or becomes an entity that is separate from GATX, and the Participant is not, immediately following the Change in Control, employed by the Company or an entity that is then a Subsidiary, then the occurrence of the Change in Control shall be treated as the Participant’s Date of Termination caused by the Participant being discharged by the employer without Cause. (f) Except pursuant to a domestic relations order, the Performance Shares may not be sold, assigned, transferred, pledged or otherwise encumbered until Shares have been distributed to the Participant free and clear of all restrictions. 5. Withholding. The granting, vesting and settlement of Performance Shares under this Agreement are subject to withholding of all applicable taxes, employee social security or other social insurance contributions, solidarity charges and any other legally required withholdings on income. Subject to such rules and limitations as may be established by the Committee from time to time, and Section 12.2 of the Plan, the Participant may satisfy his or her withholding obligations through (i) payment of cash to the Company equal to the amount of taxes required to be withheld, (ii) contemporaneously withholding from other sources of income otherwise payable to the Participant by the Company or any Subsidiary, or (iii) the surrender of Shares which the Participant already owns, or to which the Participant is otherwise entitled under the Plan or this Agreement; provided, however, that, except as otherwise provided by the Committee, Shares otherwise payable under

6 this Agreement may not be used to satisfy more than the Employer's minimum legally required withholding obligation (based on minimum statutory rates that are applicable to such income). In the event that the withholding obligation arises during a period in which the Participant is prohibited from trading in Common Stock pursuant to the Company’s insider trading policy, or otherwise by applicable law, then unless otherwise elected by the Participant during a period when he or she was not so restricted from trading, the Employer shall automatically satisfy the Participant’s withholding obligation by withholding from Shares otherwise deliverable under this Agreement. The Participant understands that he/she may suffer adverse tax consequences as a result of the grant, vesting or settlement of the Performance Shares. GATX including the Employer does not make any representation or undertaking regarding the treatment of any tax withholding in connection with the awarding, vesting or settlement of the Performance Shares. GATX does not commit and is under no obligation to structure the Plan to reduce or eliminate Participant’s tax liability. The Participant represents that he/she has had the opportunity to consult with any tax consultants he/she deems advisable in connection with the Plan and that he/she is not relying on the Company or the Employer for any tax advice. The Participant is relying solely on such advisors and not on any statements or representations of the Company, the Employer or any of their agents. 6. Heirs and Successors. This Agreement shall be binding upon, and inure to the benefit of, the Company and its successors and assigns, including any person acquiring, whether by merger, consolidation, purchase of assets or otherwise, all or substantially all of the Company's assets and business. If any rights of the Participant or benefits distributable to the Participant under this Agreement have not been exercised or distributed, respectively, at the time of the Participant's death, such rights shall be exercisable by the Designated Beneficiary, and such benefits shall be distributed to the Designated Beneficiary, in accordance with the provisions of this Agreement and the Plan. If a deceased Participant fails to designate a beneficiary, or if the Designated Beneficiary does not survive the Participant, any rights that would have been exercisable by the Participant and any benefits distributable to the Participant shall be exercised by or distributed to the legal representative of the estate of the Participant. If a deceased Participant designates a beneficiary and the Designated Beneficiary survives the Participant but dies before the Designated Beneficiary's exercise of all rights under this Agreement or before the complete distribution of benefits to the Designated Beneficiary under this Agreement, then any rights that would have been exercisable by the Designated Beneficiary shall be exercised by the legal representative of the estate of the Designated Beneficiary, and any benefits distributable to the Designated Beneficiary shall be distributed to the legal representative of the estate of the Designated Beneficiary. 7. Administration. The authority to manage and control the operation and administration of this Agreement shall be vested in the Committee, and the Committee shall have all powers with respect to this Agreement as it has with

7 respect to the Plan. Any interpretation of this Agreement by the Committee and any decision made by it with respect to this Agreement shall be final and binding on all persons. 8. Modification of Performance Goals. Pursuant to Subsection 2.33(b) of the Plan, in determining the extent to which the Performance Goals have been achieved, the Committee may, in its sole discretion, include or exclude items or events that impact the final results, positively or negatively, as it deems appropriate. In the event that it is later determined an award was erroneously calculated and paid, then the Company may, in its sole discretion, make appropriate adjustments, including the right to recover any overpayment through offsets of future compensation (to the extent legally permissible) or to make additional payments for any award that was underpaid. Nothing herein shall require the Company to correct any under or overpayment. In case of an overpayment, employees agree to execute the appropriate forms upon request authorizing the Company to deduct the amount of such overpayment from payroll, in accordance with applicable wage deduction laws, or to promptly repay such overpayment in full upon request. 9. Plan Governs. Notwithstanding anything in this Agreement to the contrary, the terms of this Agreement shall be subject to the terms of the Plan, a copy of which may be obtained by the Participant from the Director, Compensation of the Company. This Agreement is subject to all interpretations, amendments, rules and regulations promulgated by the Administrator from time to time pursuant to the Plan. 10. Not An Employment Contract. The grant of Performance Shares hereunder will not confer on the Participant any right with respect to continuance of employment or other service with GATX or the Employer, nor will it interfere in any way with any right GATX or the Employer would otherwise have to terminate or modify the terms of such Participant's employment or other service at any time. The grant of the Performance Shares does not create or form any part of a contract for employment with the Employer or any GATX entity. 11. Notices. Any written notices provided for in this Agreement or the Plan shall be provided in accordance with subparagraph 11(a) or 11(b), as applicable and, if provided to the Company, shall be addressed as follows: GATX Corporation 233 South Wacker Drive Chicago, IL 60606-7147 U.S.A. (a) Any notice required by the Participant pursuant to the definition of Good Reason, as defined below, shall be in writing given by email, hand delivery or by registered or certified mail, return receipt requested, postage prepaid,

8 addressed to the Executive Vice President and Chief Human Resources Officer and shall be effective when actually received. (b) All other notices shall be in writing and shall be deemed sufficiently given if emailed, hand delivered or if sent by fax or overnight courier, or by postage paid first class mail. Any such notice sent by mail or email shall be deemed received three business days after mailing or emailing, but in no event later than the date of actual receipt and shall be directed, if to the Participant, at the Participant's address indicated by the Company's records, or if to the Company, to the attention of the Director, Compensation and Benefits. 12. Amendment. This Agreement may be amended in accordance with the provisions of the Plan, and may otherwise be amended by written agreement of the parties. 13. No Right to Future Grants; No right to Compensation. The Plan is discretionary in nature and that, subject to the terms of the Plan, the Company can amend, cancel or terminate the Plan at any time. The grant of the Performance Shares under the Plan is voluntary and occasional and does not give Participant any contractual or other right to receive Performance Shares or benefits in lieu of Performance Shares in the future, even if a Participant has received Performance Shares repeatedly in the past. All determinations with respect to any future awards, including, but not limited to, the times when awards under the Plan shall be granted and the terms thereof, including the time or times when any Performance Shares may vest, will be at the sole discretion of the Administrator. Participation in the Plan is voluntary. The value of the Performance Shares is an extraordinary item of compensation that is outside of the scope of any employment contract or directorship, or consultancy relationship and are not part of normal or expected compensation or salary for any purpose, including, without limitation, calculating severance, resignation, redundancy, end of service payments, bonuses, long- service awards, pension or retirement benefits, or similar payments. No claim or entitlement to compensation or damages arises from the expiration, termination or forfeiture of the Performance Shares or any portion thereof. 14. Definitions. For purposes of this Agreement, the terms used in this Agreement shall be subject to the following: “3-Year Average Return on Equity” means the sum of net income divided by average equity for each year in the Performance Period divided by three (3). Accumulated other comprehensive income is excluded from equity. “3-Year Cumulative Investment Volume” means the sum of consolidated cumulative GAAP basis portfolio investments and capital additions as reported on the Company’s audited balance sheet for each year in the Performance Period. Purchases of leased in assets are excluded.

9 “Cause” means (a) the willful and continued failure to perform substantially Participant’s duties with GATX (other than any such failure resulting from incapacity due to physical or mental illness), after a written demand for substantial performance is delivered to Participant by the Board or the Chief Executive Officer of the Company which specifically identifies the manner in which the Board or Chief Executive Officer believes that Participant has not substantially performed Participant’s duties , or (b) the willful engaging by the Participant in illegal conduct or gross misconduct which is materially and demonstrably injurious to GATX. For purposes of this provision, no act or failure to act, on the part of the Participant, shall be considered “willful” unless it is done, or omitted to be done, by the Participant in bad faith or without reasonable belief, that the Participant’s action or omission was in the best interests of GATX. “Change in Control” shall have the meaning ascribed to it in Section 2.7 of the Plan; provided, however, to the extent required to avoid the imposition of additional taxes under Section 409A of the Code, such Change in Control must also constitute a “change in control event” within the meaning of Treasury Regulation Section 1.409A-3(i)(5). “Date of Termination” means the date on which the Participant incurs a Termination of Service. “Designated Beneficiary” means the beneficiary or beneficiaries designated by the Participant in a writing filed with the Administrator in such form and at such time as the Administrator shall require. “Disability” means, except as otherwise provided by the Administrator, any disability that entitles the Participant to disability income benefits under the GATX Long Term Disability Income Plan as in effect from time to time. “Employer” means the GATX entity which employs the Participant. “GATX” means the Company collectively with each Subsidiary thereof. “Good Reason” means the occurrence of one or more of the following conditions without the consent of the Participant: (a) a material diminution in the Participant's base compensation, compared with the Participant's base compensation in effect immediately prior to the consummation of a Change in Control; (b) a material diminution in the Participant's authority, duties, or responsibilities, compared with the authority, duties, and responsibilities of the Participant immediately prior to the consummation of a Change in Control; (c) the Participant is required to report to a supervisor with materially less authority, duties, or responsibilities than the authority, duties, and

10 responsibilities of the supervisor who had the greatest such authority, duties, and responsibilities at the time the Participant was required to report to such supervisor during the 120-day period immediately preceding the consummation of a Change in Control; (d) a material diminution in the budget over which the Participant retains authority, compared with the most significant budget, if any, over which the Participant had authority at any time during the 120-day period immediately preceding the consummation of a Change in Control; (e) a material change in the geographic location at which the Participant must perform services; or (f) any other action or inaction by GATX that constitutes a material breach of any individual severance agreement between GATX and the Participant or the Severance Plan, in each case to the extent in effect when a Change in Control occurs. If (I) the Participant provides written notice to GATX of the occurrence of Good Reason within a reasonable time (not more than 90 days) after the Participant has knowledge of the circumstances constituting Good Reason, which notice specifically identifies the circumstances which the Participant believes constitute Good Reason; (II) GATX fails to notify the Participant of GATX’s intended method of correction within a reasonable period of time (not less than 30 days) after GATX receives the notice, or GATX fails to correct the circumstances within a reasonable period of time after such notice (except that no such opportunity to correct shall be applicable if the circumstances constituting Good Reason are those described in paragraph (e) above, relating to relocation); and (III) the Participant resigns within a reasonable time after receiving GATX’s response, if such notice does not indicate an intention to correct such circumstances, or within a reasonable time after GATX fails to correct such circumstances (provided that in no event may such termination occur more than two (2) years after the initial existence of the condition constituting Good Reason), then the Participant shall be considered to have terminated for Good Reason. “Grant Date” means the date the grant was approved by the Committee. “Performance Goals” means 3-Year Average Return on Equity and 3-Year Cumulative Investment Volume established by the Committee for the Performance Period as set forth in Exhibit 1. “Retirement” means the Participant’s voluntary retirement from the Employer on or after both attaining at least age 55 and completing at least 15 years of service as of the Date of Termination.

11 Exhibit 1 Performance Goals, Weights and % of Target Earned 202[X]-202[X] Performance Period 3-Year Average ROE (1) (50% weight) % of Target Grant Earned Interpolated for actual performance between levels shown (1) 3-Year Average Return on Equity is defined as the sum of net income divided by average equity for each year in the Performance Period divided by three (3); excludes accumulated other comprehensive income from equity. 3-Year Cumulative Investment Volume (2) (50% weight) % of Target Grant Earned Interpolated for actual performance between levels shown (2) 3-Year Cumulative Investment Volume is defined as the sum of consolidated cumulative GAAP basis portfolio investments and capital additions as externally reported for each year in the Performance Period; excludes purchases of leased in assets. In determining the extent to which the Performance Goals have been achieved, the Committee, in its sole discretion, may include or exclude items or events that impact the final results, positively or negatively.

Exhibit 2 12 Sample Calculation of Performance Shares Earned Number of Performance Shares Granted: 1,000 Performance Goal Weight Target Goal Assumed Actual Payout Percentage Weighted Payout Percentage 3-Year Average ROE 3-Year Cumulative Investment Volume 50% 50% Total Weighted Payout Performance Shares Earned Shares Granted Weighted Payout Total Performance Shares Earned 1,000 x