RESTRICTED STOCK UNIT ISSUANCE AGREEMENT- FINANCIAL PERFORMANCE
Exhibit 10.49
CEO Award
RESTRICTED STOCK UNIT ISSUANCE AGREEMENT- FINANCIAL PERFORMANCE
VESTING
RECITALS
A.The Board has adopted the Plan for the purpose of retaining the services
of selected Employees, non-employee members of the Board (or the board of directors of any
Affiliate) and consultants who provide services to the Corporation (or any Affiliate).
B.Participant is to render valuable services to the Corporation (or an
Affiliate), and this Agreement is executed pursuant to, and is intended to carry out the purposes
of, the Plan in connection with the Corporation’s issuance of shares of Common Stock to
Participant under the Plan.
C. The award made by the Corporation pursuant to this Agreement is in
consideration for the Participant’s services to the Corporation and/or its Affiliates and
acceptance of, and agreement to, the terms, conditions and restrictions of the restrictive
covenants set forth in Paragraph 9 of this Agreement.
D.Unless otherwise defined in this Agreement, all capitalized terms in this
Agreement shall have the meaning assigned to them in the attached Appendix A.
NOW, THEREFORE, it is hereby agreed as follows:
1.Grant of Restricted Stock Units. The Corporation hereby awards to
Participant, as of the Award Date, Restricted Stock Units under the Plan. Except as otherwise
provided in this Agreement, the Restricted Stock Units shall vest on __________, provided (i)
the Participant continues in Service until __________, and (ii) the pre-established Performance
Objectives set forth in the attached Schedule I are attained over the Measurement Period. Each
Restricted Stock Unit which so vests shall entitle Participant to receive one share of Common
Stock on the specified issue date. The number of shares of Common Stock subject to the
awarded Restricted Stock Units, the applicable performance targets for the vesting of those
shares, the alternative and special vesting provisions which may become applicable to such
shares, the date on which the vested shares shall become issuable (or, under certain
circumstances, the cash equivalent thereof shall become payable) to Participant and the
remaining terms and conditions governing the Award shall be as set forth in this Agreement.
AWARD SUMMARY
Award Date: | __________ |
Target Number of Shares Subject to Award: | __________ shares of Common Stock (the “Shares”); provided, however, that the actual number of Restricted Stock Units shall be determined in accordance with the provisions of Schedule I attached hereto. |
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Vesting Schedule: | The Restricted Stock Units shall vest on __________, provided (i) the Participant continues in Service until __________, and (ii) the Performance Objectives set forth in the attached Schedule I, Section (A) are attained over the Measurement Period. However, the Restricted Stock Units may also vest in accordance with the special vesting provisions of Paragraph 5 of this Agreement. |
Issuance Schedule: | Subject to Participant’s satisfaction of applicable Withholding Taxes as described in Paragraph 7, the Shares in which Participant vests in accordance with the foregoing Vesting Schedule shall become issuable upon the Issue Date. Except to the extent otherwise specified in Paragraph 5, the “Issue Date” with respect to any Shares shall be on or as soon as practicable following __________, but in no event later than sixty (60) days following such date. Notwithstanding the foregoing, or anything contained herein to the contrary, the Plan Administrator has the discretion to provide for the payment of vested Shares in cash, rather than Shares. In the event the Plan Administrator exercises such discretion, all references herein to payment in Shares or the right to receive Shares shall be replaced with references to payment in cash and/or the right to receive payment in cash equal to the Fair Market Value of the Shares on the date the Plan Administrator determines the attainment of the Performance Objectives. |
Restrictive Covenants: | The Award is being made by the Corporation in consideration for the Participant’s services to the Corporation and its Affiliates and acceptance of, and agreement to be bound by, the terms, conditions and restrictions of the restrictive covenants set forth in Paragraph 9 of this Agreement, which acceptance and agreement shall be evidenced by the Participant’s execution of this Agreement. |
▇.▇▇▇▇▇▇▇ Transferability. Prior to the actual issuance of the Shares which
vest hereunder, Participant may not transfer any interest in the Award or the underlying Shares;
provided, however, any Shares which vest hereunder but which otherwise remain unissued at
the time of Participant’s death may be transferred pursuant to the provisions of Participant’s will
or the laws of inheritance or to Participant’s designated beneficiary or beneficiaries of this
Award. Participant may make a beneficiary designation for this Award at any time by filing the
appropriate form with the Plan Administrator or its designee.
3.Cessation of Service. Except as otherwise provided in Paragraph 5
below, should Participant cease Service for any reason prior to vesting in one or more Shares
subject to this Award, then the Award will be immediately cancelled with respect to those
unvested Shares. Participant shall thereupon cease to have any right or entitlement to receive
any Shares under those cancelled units.
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4.Stockholder Rights and Dividend Equivalents
(a)The holder of this Award shall not have any stockholder rights,
including voting or dividend rights, with respect to the Shares subject to the Award until
Participant becomes the record holder of those Shares in accordance with the terms herein.
(b)Notwithstanding the foregoing, should any stock dividend, whether
regular or extraordinary, be declared and paid on the outstanding Common Stock while one or
more Shares remain subject to this Award (i.e., those Shares are not otherwise issued and
outstanding for purposes of entitlement to the dividend or distribution), then Participant shall
automatically be credited with an additional number of Restricted Stock Units equal to the
number of shares of Common Stock which would have been paid on the Shares (plus the
number of additional shares previously credited to Participant pursuant to the dividend
equivalent right provisions of this Paragraph 4) at the time subject to this Award had those
Shares been actually issued and outstanding and entitled to that dividend. The additional
Restricted Stock Units so credited shall vest to the extent the Restricted Stock Units to which
they relate vest and shall be distributed to Participant concurrently with the issuance of those
Shares on the applicable Issue Date, subject to the Corporation’s collection of the Withholding
Taxes applicable to that distribution.
(c)Notwithstanding the foregoing, should any cash dividend, whether
regular or extraordinary, be declared and paid on the outstanding Common Stock while one or
more Shares remain subject to this Award (i.e., those Shares are not otherwise issued and
outstanding for purposes of entitlement to the dividend or distribution), then a special book
account shall be established for Participant and credited with a dollar amount equal to the
amount of that dividend paid per share multiplied by the number of Restricted Stock Units at the
time subject to this Award (plus the number of additional shares previously credited to
Participant pursuant to the dividend equivalent right provisions of this Paragraph 4) as of the
record date for the dividend. No later than as of __________ each year following the Award
Date and prior to __________ and no later than as of __________ (each such date a
“Conversion Date”), each cash dividend amount credited to the special book account since the
Award Date or the most recent prior Conversion Date, as applicable, shall be converted into a
book entry of an additional number of Restricted Stock Units determined by dividing (i) such
cash dividend equivalent amount by (ii) the average of the Fair Market Value per share of
Common Stock on each of the dates during such period on which those dividends on the
outstanding Common Stock were paid, rounded down to the nearest full share. The additional
Restricted Stock Units so credited shall vest to the extent the Restricted Stock Units to which
they relate vest and shall be distributed to Participant concurrently with the issuance of those
Shares on the applicable Issue Date, subject to the Corporation’s collection of the Withholding
Taxes applicable to that distribution.
5.Special Vesting/Change in Control.
(a)Should Participant’s Service terminate (i) by reason of his or her
death or Permanent Disability, or (ii) involuntarily by the Corporation after Participant has
completed at least thirty (30) Years of Service other than in connection with a termination for
Misconduct, in either case prior to __________, then on __________, Participant shall vest in a
number of Shares equal to the number of Shares (if any) in which Participant would have been
vested on __________, had Participant continued in Service through __________, multiplied by
a fraction, the numerator of which is the number of days of Service Participant completed
between the Award Date and the termination of Participant’s Service, and the denominator of
which is the total number of days during the period beginning on the Award Date and ending on
__________; provided, however, that, in the event that Participant’s Service terminates (i) by
reason of his or her death or Permanent Disability, or (ii) involuntarily by the Corporation after
Participant has completed at least thirty (30) Years of Service other than in connection with a
termination for Misconduct, on or after the last day of the Measurement Period, the Participant
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shall vest in a number of Shares equal to the number of Shares (if any) in which Participant
would have vested had his or her Service continued without interruption through __________.
The Issue Date with respect to the Shares that vest pursuant to this Paragraph 5(a) shall be on
or as soon as practicable following __________ but in no event later than sixty (60) days
following such date.
(b)Should Participant’s Service terminate (i) by reason of his or her
death or Permanent Disability, or (ii) involuntary termination by the Corporation for reasons other
than Misconduct (collectively, such termination events in (i) and (ii), the “Non-Misconduct
Termination”) on or after __________ but prior to __________, then, on __________,
Participant shall vest in a number of Shares equal to the number of Shares (if any) in which
Participant would have vested had his or her Service continued without interruption through
__________, and for the avoidance doubt, subject in all respects to the pre-established
Performance Objectives set forth in the attached Schedule I that may be attained over the
Measurement Period; provided, however, that, in the event the Non-Misconduct Termination
occurs on or after the last day of the Measurement Period and prior to __________, the
Participant shall vest in the same number of Shares as set forth in this Paragraph 5(b), but the
vesting date shall be the date of the Non-Misconduct Termination. The Issue Date with respect
to the Shares that vest pursuant to this Paragraph 5(b) shall be on or as soon as practicable
following __________ or the date of the Non-Misconduct Termination, if applicable, but in no
event later than sixty (60) days following such applicable date.
(c)Should Participant’s Service terminate by reason of his or her
Early Retirement prior to __________, then on __________, Participant shall vest in a number
of Shares equal to the number of Shares (if any) in which Participant would have been vested
on __________, had Participant continued in Service through __________, multiplied by a
fraction, the numerator of which is the number of days of Service Participant completed between
the Award Date and the termination of Participant’s Service, and the denominator of which is the
total number of days during the period beginning on the Award Date and ending on
__________. In the event of the termination of Participant’s Service due to Participant’s Early
Retirement, such vesting shall be conditioned upon Participant’s compliance with the conditions
of Section 9 through __________. The Issue Date with respect to the Shares that vest pursuant
to this Paragraph 5(c) shall be on or as soon as practicable following __________ but in no
event later than sixty (60) days following such date.
(d)Any Restricted Stock Units subject to this Award at the time of a
Change in Control may be assumed by the successor entity or otherwise continued in full force
and effect or may be replaced with a cash retention program of the successor entity which
preserves the Fair Market Value of the unvested shares of Common Stock subject to the Award
at the time of the Change in Control and provides for subsequent payout of that value in
accordance with the same (or more favorable) vesting schedule in effect for the Award at the
time of such Change in Control. In the event of such assumption or continuation of the Award or
such replacement of the Award with a cash retention program, no accelerated vesting of the
Restricted Stock Units shall occur at the time of the Change in Control. However, in the event
that the Change in Control occurs prior to the end of the Measurement Period, the vesting
provisions in effect for the Award following the Change in Control shall no longer be tied to the
attainment of the full Performance Objectives set forth in Schedule I and shall instead be
converted into the following vesting schedule: The Award (whether in its assumed or continued
form or as converted into a cash retention program) shall vest with respect to the number of
Shares (or the amount of cash) determined under Paragraph 5(d) below upon Participant’s
continuation in Service through __________. Following the completion of such Service vesting
period, the securities, cash or other property underlying the vested Award shall be issued on or
as soon as practicable following the applicable Issue Date, but in no event later than sixty (60)
days thereafter. The Award may also vest in accordance with the special vesting provisions of
Paragraphs 5(a) and (b) of this Agreement.
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(e)In the event the Award is assumed or otherwise continued in
effect, the Restricted Stock Units subject to the Award shall be adjusted immediately after the
consummation of the Change in Control so as to apply to the number and class of securities into
which the Shares subject to those units immediately prior to the Change in Control would have
been converted in consummation of that Change in Control had those Shares actually been
issued and outstanding at that time. However, the Award shall remain outstanding and eligible
for Service vesting under the terms of this Agreement only with respect to the number of Shares
(as so adjusted) set forth on Schedule I, Section (B). To the extent the actual holders of the
outstanding Common Stock receive cash consideration for their Common Stock in
consummation of the Change in Control, the successor corporation (or parent entity) may, in
connection with the assumption or continuation of the Restricted Stock Units subject to the
Award at that time, substitute one or more shares of its own common stock with a fair market
value equivalent to the cash consideration paid per share of Common Stock in the Change in
Control transaction, provided such common stock is readily tradable on an established U.S.
securities exchange or market. In the event the Award is converted into a cash retention
program, the amount of cash subject to the Award under such program shall be equal to the
value of the number of Shares determined in accordance with the foregoing provisions of this
Section 5(d) as of the effective date of the Change in Control (based on the per-share value of
the consideration received by holders of the outstanding Common Stock in connection with the
Change in Control), plus credited interest or earnings through the Issue Date as determined
under the terms of such cash retention program. The Issue Date with respect to the Shares that
vest pursuant to this Paragraph 5(d) shall be on or as soon as practicable following
__________, but in no event later than sixty (60) days following such date.
(f)If (i) the Change in Control occurs on or after the end of the
Measurement Period but prior to __________, or (ii) if the Change in Control occurs prior to the
end of the Measurement Period but the Restricted Stock Units subject to this Award at the time
of the Change in Control are not assumed or otherwise continued in effect or replaced with a
cash retention program in accordance with Paragraph 5(c), then the number of Shares set forth
on Schedule I, Section (B) will vest immediately prior to the closing of the Change in Control.
The Shares that vest under this subparagraph (e) will be issued on the Issue Date triggered by
the Change in Control (or otherwise converted into the right to receive the same consideration
per share of Common Stock payable to the other stockholders of the Corporation in
consummation of that Change in Control and distributed either (i) to the extent permitted by
Treas. Reg. Section 1.409A-3(i)(5)(iv), at the same time as such stockholder payments, or (ii) to
the extent not so permitted, at the Issue Date that would otherwise have applied to the Shares,
as set forth below), subject to the Corporation’s collection of the applicable Withholding Taxes
pursuant to the provisions of Paragraph 7. For purposes of this Paragraph 5(e), the Issue Date
with respect to such Shares shall be on or as soon as practicable following the effective date of
the Change in Control (but in no event later than sixty (60) days following such date) so long as
it qualifies as a “change in the ownership or effective control” or a “change in the ownership of a
substantial portion of the assets” of the Corporation within the meaning of Section
409A(a)(2)(A)(v) of the Code and regulations thereunder and such Shares are issued in
compliance with Treas. Reg. Section 1.409A-3(j)(4)(ix)(B).
(g)This Agreement shall not in any way affect the right of the
Corporation to adjust, reclassify, reorganize or otherwise change its capital or business structure
or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or
assets.
(h)Nothing in this Paragraph 5 shall give the Corporation or any
successor any right or discretion to change the time of issuance of Shares or payment of cash
to the extent that such change would cause the Award to fail to comply with the requirements of
Section 409A of the Code and this Paragraph 5 shall be interpreted accordingly.
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6.Adjustment in Shares. In the event that the Plan Administrator
determines that any dividend or other distribution (other than regular cash dividends),
recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up,
spin-off, combination, repurchase or exchange of shares or other securities of the Corporation,
issuance of warrants or other rights to purchase shares or other securities of the Corporation, or
other similar corporate transaction or event affects the Shares such that an adjustment is
determined by the Plan Administrator to be appropriate in order to prevent dilution or
enlargement of the benefits intended to be made available under this Agreement, then the Plan
Administrator shall, in such manner as it may deem equitable, adjust any or all of the number
and type of shares (or other securities or property) subject to this Agreement, or, if the Plan
Administrator deems it appropriate, make provision for a cash payment to the Participant.
7.Collection of Withholding Taxes.
(a)Upon the applicable Issue Date, the Corporation shall issue to or
on behalf of Participant a certificate (which may be in electronic form) for the applicable number
of underlying shares of Common Stock, subject, however, to the Corporation’s collection of the
applicable Withholding Taxes.
(b)Until such time as the Corporation provides Participant with written
or electronic notice to the contrary, the Corporation shall collect Withholding Taxes required to
be withheld with respect to the vesting or issuance of the vested Shares hereunder (including
shares attributable to the dividend equivalent rights provided under Paragraph 4) through an
automatic share withholding procedure pursuant to which the Corporation will withhold, at the
time of such vesting or issuance, a portion of the Shares with a Fair Market Value (measured as
of the vesting or Issue Date, as applicable) equal to the amount of those taxes (including taxes
resulting from such withholding) (the “Share Withholding Method”) necessary to satisfy the
Corporation’s required tax withholding obligations; provided, however, that the amount of any
Shares so withheld shall not exceed the maximum statutory withholding rates for federal, state
and local tax purposes, including the Participant’s share of payroll or similar taxes, that are
applicable to the Participant’s relevant jurisdiction. Participant shall be notified in writing or
electronically in the event such Share Withholding Method is no longer available.
(c)Should any Shares (including shares attributable to the dividend
equivalent rights provided under Paragraph 4) vest or be issued at a time when the Share
Withholding Method is not available, then the Withholding Taxes required to be withheld with
respect to those Shares shall be collected from Participant through either of the following
alternatives:
-Participant’s delivery of his or her separate check payable to the
Corporation in the amount of such taxes, or
-the use of the proceeds from a next-day sale of the Shares issued
to Participant, provided and only if (i) such a sale is permissible under the Corporation’s trading
policies governing the sale of Common Stock, (ii) Participant makes an irrevocable commitment,
on or before the Issue Date for those Shares, to effect such sale of the Shares and (iii) the
transaction is not otherwise deemed to constitute a prohibited loan under Section 402 of the
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002.
(d)In no event, however, shall any fractional shares be issued.
Accordingly, the total number of shares of Common Stock to be issued pursuant to the Award
shall, to the extent necessary, be rounded down to the next whole share in order to avoid the
issuance of a fractional share.
8.Compliance with Laws and Regulations. The issuance of shares of
Common Stock pursuant to the Award shall be subject to compliance by the Corporation and
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Participant with all applicable requirements of law relating thereto and with all applicable
regulations of any stock exchange on which the Common Stock may be listed for trading at the
time of such issuance.
9.Restrictive Covenants; Additional Conditions.
(a)As a condition of receiving this Award, the Participant hereby
acknowledges and agrees that during the period in which the Participant provides Services to
the Corporation or any Affiliate, and for the Restrictive Covenant Period following the date on
which the Participant ceases to provide Service to the Corporation or any Affiliate for any
reason, the Participant shall comply with the restrictive covenants set forth herein. The
restrictive covenants set forth herein shall not supersede and replace any other restrictions and
obligations the Participant may be subject to with the Corporation and if there is a conflict
between comparable restrictions the more restrictive provisions shall control, as reasonably
determined by the Corporation:
(i)Participant acknowledges that during Participant’s Service
with the Corporation and its Affiliates, Participant will have access to, possess or help the
Corporation develop valuable proprietary commercial and/or technical information, trade
secrets and other confidential information belonging to the Corporation and its Affiliates
and will be instrumental to the development and/or maintenance of goodwill with the
Corporation’s and its Affiliates’ customers. Participant acknowledges that such
proprietary information, trade secrets, confidential information and goodwill are valuable
assets of the Corporation and its Affiliates and the Corporation has a legitimate interest
in protecting itself from disclosure or misappropriation of such information and from
interference with its goodwill relationships with its customers.
(ii)Other than in the ordinary course or for the benefit of the
business of the Corporation and its Affiliates, during the term of Participant’s Service with
the Corporation and its Affiliates and thereafter for the maximum duration permissible
under applicable law, Participant shall not, directly or indirectly, divulge, furnish or make
accessible to any other person, business, firm or corporation, or use in any way, any
Confidential Information which Participant has acquired or become acquainted with or
shall acquire or become acquainted with as a result of Participant’s Service with the
Corporation or any Affiliate, whether developed by Participant, or by others. The
Confidential Information is the property of the Corporation and/or Affiliate and Participant
acknowledges that the use, misappropriation or disclosure of the Confidential
Information would constitute a breach of trust, and fiduciary duty and would cause
irreparable injury to the Corporation and/or Affiliate. Furthermore, Participant
acknowledges that during Participant’s Service with the Corporation and any Affiliate,
Participant may be exposed to the confidential information of customers and other third
parties and Participant shall maintain the confidentiality of this information and shall only
use it as necessary to carry out the work for the Corporation and any Affiliate consistent
with restrictions placed upon such Confidential Information. Nothing contained herein
shall restrict Participant’s use of general knowledge acquired by Participant as part of
Participant’s normal growth in Participant’s profession nor will it prohibit Participant from
disclosing information related to claims of unlawful discrimination, harassment, or
retaliation, or information relevant to an investigation of such a claim. Moreover, nothing
contained in this Agreement, including in this Section 9, shall prohibit or be construed as
prohibiting the exercise of any right by Participant under Section 7 of the National Labor
Relations Act or that Participant cannot waive or forego under applicable laws or
regulations.
(iii)Participant shall not, during the term of Participant’s
Service with the Corporation and any Affiliate and for the Restrictive Covenant Period,
render services as an officer, owner (other than having less than two (2%) percent
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ownership of a publicly traded corporation’s stock), director, consultant, employee, or
other service provider, to, or on behalf of, a Competing Business, provided, however, this
Section 9(a)(iii) will not apply if Participant’s duties and responsibilities for any
Competing Business do not involve Participant in the provision of any services that are
similar to or competitive with the services Participant provided to the Corporation or any
Affiliate. Participant acknowledges that the Corporation together with its Affiliates is
engaged in business throughout the world and that the marketplace for the Corporation’s
and its Affiliates’ products and services is worldwide, and thus the geographic area,
length and scope of this noncompetition provision are reasonable and necessary to
protect the legitimate business interests of the Corporation and its Affiliates. In the event
a court of competent jurisdiction determines that one or more of the provisions of this
Paragraph 9(a) are so broad as to be unenforceable, then such provision shall be
deemed to be reduced in scope or length, as the case may be, to the extent required to
make such provisions enforceable.
(iv)Participant shall disclose promptly and assign to the
Corporation or the Affiliate all right, title and interest in any invention or idea, patentable
or not, made or conceived by Participant during Service with the Corporation or the
Affiliate, relating in any manner to the actual or anticipated business, research or
development work of the Corporation or the Affiliate and shall do anything reasonably
necessary to enable the Corporation or the Affiliate to secure a patent where appropriate
in the United States and in foreign countries.
(v)Participant shall not, directly or indirectly, solicit, for the
purpose of offering or attempting to offer any service, product or other application which
is the same as or similar to the services, products or other applications offered or in the
process of being developed by the Corporation or any Affiliate within the last year prior to
termination of Participant’s Service with the Corporation or any Affiliate, any of the
Corporation’s or any Affiliate’s customers to whom Participant was assigned or serviced,
solicited or called upon, with whom Participant had material contact, or about whom
Participant obtained, or had access to, confidential information during Participant’s
Service, for the Restrictive Covenant Period. Participant further agrees, for the
Restrictive Covenant Period, that Participant shall not solicit or attempt to solicit any
employee of, or consultant to, the Corporation or any Affiliate, which employee or
consultant had been rendering services to the Corporation or any Affiliate at any time
within the six-month period immediately preceding the termination of Participant’s
Service, to leave the employ of, or no longer render service to or for the benefit of, the
Corporation or any Affiliate.
(vi)Participant shall not make any Disparaging Statements
about the Corporation or any Affiliate to any of the Corporation’s or any Affiliate’s past,
present, or future customers, employees, clients, contractors, vendors, or to the media or
to any other person either orally or by any other medium of communication, including
internet communication. As used herein, the term “Disparaging Statement” means any
communication, oral or written, which would cause or tend to cause humiliation or
embarrassment or to cause a recipient of such communication to question the business
condition, integrity, product, service, quality, confidence, or good character of the
Corporation or any Affiliate. The foregoing is not intended to preclude or dissuade
Participant from reporting possible securities law violations to the Securities and
Exchange Commission or any other federal or state regulatory authority, or engaging in
protected activities, including concerted activities protected by the National Labor
Relations Act, or legally required activities.
(vii)Participant shall, during the Restrictive Covenant Period,
remain contactable by the Corporation or any Affiliate, and, to a reasonable extent,
cooperate with the Corporation or any Affiliate’s counsel and other representatives
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regarding matters arising out of or related to Participant’s Service, including, without
limitation, legal disputes involving matters arising during Participant’s Service in which
Participant was involved or in which Participant is knowledgeable of relevant information,
and the Corporation shall reimburse Participant for reasonable expenses incurred in
connection with such cooperation in legal disputes.
(b) Participant acknowledges that a breach of any of the covenants
contained in this Agreement may cause irreparable damage to the Corporation or
Affiliate, the exact amount of which would be difficult to ascertain, and that the remedies
at law for any such breach or threatened breach would be inadequate. Accordingly,
Participant agrees that if Participant breaches or threatens to breach any of the
covenants contained in this Agreement, in addition to any other remedy which may be
available to the Corporation at law or in equity, the Corporation shall be entitled to (i)
cease or withhold any payment, including any issuance of Shares or payment of cash, to
Participant pursuant to this Award, including the return of any previously delivered
payment, including any Shares, proceeds recognized upon any sale or other disposition
of those Shares, or cash; and/or (ii) institute and prosecute proceedings in any court of
competent jurisdiction for specific performance and injunctive relief to prevent the breach
or any threatened breach thereof without bond or other security or a showing that
monetary damages will not provide an adequate remedy. Participant agrees to disclose
in advance the existence and terms of the restrictions and covenants contained in this
Agreement to any employer or service recipient by whom Participant might be employed
or retained during the period in which the covenants or restrictions apply. Participant
agrees that, in the event of a final determination of Participant's breach of any of the
covenants contained in this Agreement, the restrictions in the relevant paragraph shall
be extended for a period equal to the period that Participant was in breach. Participant
represents and acknowledges that Participant has been advised by the Corporation to
consult Participant’s own legal counsel with respect to this Agreement and Participant
has had full opportunity, prior to execution of this Agreement, to review thoroughly this
Agreement with Participant’s legal counsel.
(c)Upon delivery of the Shares or other payment pursuant to this
Award, the Plan Administrator may require Participant to certify on a form acceptable to
the Plan Administrator, that Participant is in compliance with the terms, conditions and
restrictions of the Plan and this Agreement.
(d)This Award, and the right to receive and retain any Shares or cash
payments covered by this Award, shall be subject to rescission, cancellation or
recoupment, in whole or part, if and to the extent so provided under the Koppers
Holdings Inc. Incentive-Based Compensation Recovery Policy or any other “clawback” or
similar policy of the Corporation in effect on the Award Date or that may be established
thereafter, including any modification or amendment thereto, or as required by the
▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002, the ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇ Street Reform and Consumer
Protection Act, or other applicable law as may be in effect from time to time, and which
may operate to create additional rights for the Corporation with respect to the Shares
and recovery of amounts relating thereto. By accepting this Award under the Plan,
Participant agrees and acknowledges that Participant is obligated to cooperate with, and
provide any and all assistance necessary to, the Corporation to recover or recoup any
Award or amounts paid under the Plan subject to claw-back pursuant to such law or
regulation, stock exchange listing requirement, or policy. Such cooperation and
assistance shall include, but is not limited to, executing, completing and submitting any
documentation necessary to recover or recoup any Award or amounts paid pursuant to
this Award.
10.Notices. Any notice required to be given or delivered to the Corporation
under the terms of this Agreement shall be in writing and addressed to the Secretary of the
Corporation at its principal corporate office at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
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Except to the extent electronic notice is expressly authorized hereunder, any notice required to
be given or delivered to Participant shall be in writing and addressed to Participant at the
address indicated below Participant’s signature line on this Agreement. All notices shall be
deemed effective upon personal delivery (or electronic delivery to the extent authorized
hereunder) or upon deposit in the U.S. mail, postage prepaid and properly addressed to the
party to be notified.
11.Successors and Assigns. Except to the extent otherwise provided in this
Agreement, the provisions of this Agreement shall inure to the benefit of, and be binding upon,
the Corporation and its successors and assigns and Participant, Participant’s assigns, the legal
representatives, heirs and legatees of Participant’s estate and any beneficiaries of the Award
designated by Participant.
▇▇.▇▇▇▇▇▇▇▇▇▇▇▇. This Agreement and the Award evidenced hereby are made
and granted pursuant to the Plan and are in all respects limited by and subject to the terms of
the Plan. 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. All decisions of the Plan Administrator with respect to
any question or issue arising under the Plan or this Agreement shall be conclusive and binding
on all persons having an interest in the Award.
13.Governing Law. The interpretation, performance and enforcement of this
Agreement shall be governed by the laws of the Commonwealth of Pennsylvania without resort
to Pennsylvania’s conflict-of-laws rules.
14.Right to Continued Service. Nothing in this Agreement or in the Plan shall
confer upon Participant any right to continue in Service for any period of specific duration or
interfere with or otherwise restrict in any way the rights of the Corporation (or any Affiliate
employing or retaining Participant) or of Participant, which rights are hereby expressly reserved
by each, to terminate Participant’s Service at any time for any reason, with or without cause,
unless such rights are otherwise limited pursuant to a separate agreement between the
Corporation (or any Affiliate) and Participant.
15.Section 409A. This Award is intended to be excepted from coverage
under, or compliant with the provisions of, Section 409A of the Code and the regulations
promulgated thereunder (“Section 409A”) and shall be construed accordingly. Notwithstanding
the foregoing or any provision of the Plan to the contrary, if the Award is subject to the
provisions of Section 409A (and not excepted therefrom), the provisions of the Plan and this
Agreement shall be administered, interpreted and construed in a manner necessary to comply
with Section 409A (or disregarded to the extent such provision cannot be so administered,
interpreted, or construed). For purposes of this Agreement, to the extent required by Section
409A, (i) termination of employment shall mean separation from service within the meaning of
Section 409A(a)(2)(A)(i) of the Code and (ii) if the Issue Date is the Participant’s separation from
service and the Participant is, on such date, a specified employee within the meaning of
Section 409A(a)(2)(B)(i) of the Code, the Issue Date shall be postponed as required thereunder.
If any payments or benefits hereunder may be deemed to constitute nonconforming deferred
compensation subject to taxation under the provisions of Section 409A, Participant agrees that
the Corporation may, without the consent of Participant, modify the Agreement and the Award to
the extent and in the manner the Corporation deems necessary or advisable or take such other
action or actions, including an amendment or action with retroactive effect, that the Corporation
deems appropriate in order either to preclude any such payments or benefits from being
deemed “deferred compensation” within the meaning of Section 409A or to provide such
payments or benefits in a manner that complies with the provisions of Section 409A such that
they will not be taxable thereunder. Notwithstanding, the Corporation makes no representations
and/or warranties with respect to compliance with Section 409A, and Participant recognizes and
acknowledges that Section 409A could potentially impose upon Participant certain taxes or
interest charges for which Participant is and shall remain solely responsible.
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16.Survivability. The terms of this Agreement survive the termination of
Participant’s Service for any reason.
17.Severability. In the event that any provision of this Agreement is
determined to be partially or wholly invalid, illegal or unenforceable in any jurisdiction, then such
provision shall, as to such jurisdiction, be modified or restricted to the extent necessary to make
such provision valid, binding and enforceable, or if such provision cannot be modified or
restricted, then such provision shall, as to such jurisdiction, be deemed to be excised from this
Agreement; provided, however, that the binding effect and enforceability of the remaining
provisions of this Agreement, to the extent the economic benefits conferred upon the parties by
virtue of this Agreement remain substantially unimpaired, shall not be affected or impaired in any
manner, and any such invalidity, illegality or unenforceability with respect to such provisions
shall not invalidate or render unenforceable such provision in any other jurisdiction.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the
Award Date indicated above.
By: | |
Title: | |
Participant: | |
Signature: | |
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APPENDIX A
DEFINITIONS
The following definitions shall be in effect under the Agreement:
A.Affiliate means any entity that, directly or through one or more
intermediaries, is controlled by the Corporation, and any entity in which the Corporation
has a significant equity interest as determined by the Plan Administrator.
B.Agreement shall mean this Restricted Stock Unit Issuance Agreement.
C.Award shall mean the award of Restricted Stock Units made to Participant
pursuant to the terms of this Agreement.
D.Award Date shall mean the date the Restricted Stock Units are awarded to
Participant pursuant to the Agreement and shall be the date indicated in Paragraph 1 of the
Agreement.
E.Board shall mean the Corporation’s Board of Directors.
F.Change in Control of the Corporation shall have the meaning set forth in the
Plan.
G.Code shall mean the Internal Revenue Code of 1986, as amended.
H.Common Stock shall mean shares of the Corporation’s common stock.
I.Competing Business shall mean: any person, corporation, partnership, joint
venture, association or other entity engaged in the development or offering or attempting to offer
any service, product, chemical formulation or other material which: (i) relates to treated wood
products, wood preservation chemicals or carbon compounds; (ii) constitutes or is utilized in
conjunction with railroad track joints, ties, mounting hardware, bridge timbers, bridge crossings
or bridging assemblies; (iii) constitutes or is utilized in conjunction with utility poles (including
components, inspection, treatment, maintenance and restoration thereof) or marine pilings; (iv)
relates to the recovery of wood materials or (v) constitutes any product or service which was in
the process of being developed by the Corporation or any Affiliate within the last year prior to
termination of Participant’s Service with the Corporation and any Affiliate.
J.Confidential Information shall mean any proprietary or confidential information of
the Corporation or any Affiliate, including but not limited to any trade secrets, confidential or
secret designs, technologies, content, processes, formulae, plans, manuals, devices, machines,
know-how, methods, compositions, ideas, improvements, financial and marketing information,
costs, pricing, sales, sales volume, methods and proposals, customer and prospective customer
lists, identity of key personnel in the employ of customers and prospective customers, amount or
kind of customer’s purchases from the Corporation or any Affiliate, system documentation,
hardware, engineering and configuration information, computer programs, source and object
codes (whether or not patented, patentable, copyrighted or copyrightable), related software
development information, inventions or other confidential or proprietary information belonging to
the Corporation or any Affiliate or directly or indirectly relating to the Corporation’s or Affiliate’s
business and affairs.
K.Corporation shall mean Koppers Holdings Inc., a Pennsylvania corporation, and
any successor thereto which shall by appropriate action adopt the Plan.
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L. Disparaging Statements shall have the meaning set forth in Paragraph 9(a)(vi).
M.Early Retirement shall mean Participant’s voluntary termination from Service on
or after his or her attainment of age 55 with at least ten (10) Years of Service; provided that
Participant has delivered written notice to the Corporation or Affiliate that employs Participant of
Participant’s intent to terminate service on such date at least 180 days prior thereto.
N.Employee shall mean an individual who is in the employ of the Corporation (or
any Affiliate), subject to the control and direction of the employer entity as to both the work to be
performed and the manner and method of performance.
O.Fair Market Value per share of Common Stock on any relevant date shall
have the meaning set forth in the Plan.
P.Measurement Period shall mean the three-year period commencing on
__________ and ending on __________ over which the Performance Objectives set forth in the
attached Schedule I are to be measured.
Q.Misconduct shall mean the commission of any act of fraud, embezzlement or
dishonesty by Participant, any unauthorized use or disclosure by Participant of Confidential
Information, or any other intentional misconduct by Participant adversely affecting the business
or affairs of the Corporation (or any Affiliate) in a material manner. The foregoing definition shall
not in any way preclude or restrict the right of the Corporation (or any Affiliate) to discharge or
dismiss Participant or any other person in the Service of the Corporation (or any Affiliate) for any
other acts or omissions, but such other acts or omissions shall not be deemed, for purposes of
the Plan or this Agreement, to constitute grounds for termination for Misconduct.
R.1934 Act shall mean the Securities Exchange Act of 1934, as amended from time
to time.
S.Participant shall mean the person to whom the Award is made pursuant to the
Agreement as set forth on the signature page of the Agreement.
T.Permanent Disability shall mean the inability of Participant to engage in any
substantial gainful activity by reason of any medically determinable physical or mental
impairment which is expected to result in death or to be of continuous duration of twelve (12)
months or more.
U.Plan shall mean the Corporation’s Amended and Restated 2020 Long-Term
Incentive Plan.
V.Plan Administrator shall mean the committee(s) designated by the Board to
administer the Plan.
W.Restricted Stock Units shall mean Restricted Stock Units awarded pursuant to
Section 6(c) of the Plan.
X.Restrictive Covenant Period shall mean the two-year period following a
Participant’s termination of Service with the Corporation and/or any Affiliate for any reason.
Y.Service shall mean Participant’s performance of services for the Corporation (or
any Affiliate) in the capacity of an Employee, a non-employee member of the Board or a
consultant. For purposes of this Agreement, Participant shall be deemed to cease Service
immediately upon the occurrence of either of the following events: (i) Participant no longer
performs services in any of the foregoing capacities for the Corporation (or any Affiliate) or (ii)
the entity for which Participant performs such services ceases to remain an Affiliate, even
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though Participant may subsequently continue to perform services for that entity. Service shall
not be deemed to cease during a period of military leave, sick leave or other personal leave
approved by the Corporation or an Affiliate; provided, however, that except to the extent
otherwise required by law or expressly authorized by the Plan Administrator or by the
Corporation’s or an Affiliate’s written policy on leaves of absence, no Service credit shall be
given for vesting purposes for any period the Participant is on a leave of absence.
Z.Stock Exchange shall mean the Nasdaq Global Market, the New York Stock
Exchange or such other stock exchange on which the Common Stock is listed.
AA.Withholding Taxes shall mean the federal, state and local income and
employment taxes required to be withheld by the Corporation or Affiliate in connection with the
vesting and concurrent issuance of the shares of Common Stock under the Award, including any
additional shares resulting from the dividend equivalent right provisions of the Award.
BB. Years of Service shall mean, with respect to a Participant, such
Participant’s total number of years of “accumulated service” as such term is defined with respect
to salaried employees under the Retirement Plan for Koppers Inc. (regardless of whether such
Participant is eligible to receive a benefit under such plan).
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SCHEDULE I
PERFORMANCE OBJECTIVES
The maximum number of Restricted Stock Units subject to this Agreement is ___% of the Target
Number of Shares Subject to Award, provided the Participant continues in Service until
__________ (except to the extent otherwise provided in Section 5).
(A)The actual number of Restricted Stock Units to vest during the Measurement Period
(provided Participant continues in Service until __________, except to the extent
otherwise provided in Section 5), shall be determined in accordance with the following
Performance Objectives (Three-Year Cumulative Adjusted EPS and Three-Year
Cumulative Adjusted Free Cash Flow), each having an equal weighting of fifty percent
(50%) and subject to the Performance Objective modifier set for the below:
Performance Level | Three-Year Cumulative Adjusted EPS | % of Restricted Stock Units Vesting |
Maximum | $___ | ___% |
Target | $___ | ___% |
Threshold | $___ | ___% |
Performance Level | Three-Year Cumulative Adjusted Free Cash Flow | % of Restricted Stock Units Vesting |
Maximum | $___ | ___% |
Target | $___ | ___% |
Threshold | $___ | ___% |
If the Corporation’s performance falls within the range of the Threshold and Target or the
Target and Maximum achievement levels, then the number of Restricted Stock Units will
be calculated based on a linear interpolation between the ___% and ___% levels or the
___% and ___% levels, respectively.
Following the measurement of the Restricted Stock Units subject to the Performance
Objectives set forth above, the below Performance Objective modifier shall be applied
and the actual number of Restricted Stock Units that vest may be adjusted up or down
relative to the applicable performance level:
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Performance Level | Adjusted EBITDA Margin | % of Restricted Stock Units Vesting |
Maximum | >= ___ percent | ___% |
Target | ___ percent | ___% |
Threshold | <= ___ percent | ___% |
If the Corporation’s performance falls within the range of the Minimum and Target or the
Target and Maximum achievement levels, then the Performance Objective modifier
percentage will be calculated based on a linear interpolation between the ___% and ___
% levels or the ___% and ___% levels, respectively.
The term “Three-Year Cumulative Adjusted EPS” shall mean the sum of Adjusted EPS
for each year in the Measurement Period. Adjusted EPS is defined as diluted earnings
per share, as adjusted by the Plan Administrator in its discretion to account for certain
items.
The term “Three-Year Cumulative Adjusted Free Cash Flow” shall mean the
Corporation’s total Adjusted Free Cash Flow over the Measurement Period. Free Cash
Flow is defined as the Corporation’s cash flow from operating activities minus capital
expenditures, as adjusted by the Plan Administrator in its discretion to account for certain
items.
The term “Adjusted EBITDA Margin” shall mean the Corporation’s Adjusted EBITDA
Margin for the year ended __________. Adjusted EBITDA Margin is defined as the
quotient of the Corporation’s earnings before interest, taxes, depreciation and
amortization and the Corporation’s revenue, as adjusted by the Plan Administrator in its
discretion to account for certain items.
(B)Notwithstanding the foregoing, the number of Shares with respect to which the Award
may become vested pursuant to Paragraph 5(d), and the number of Shares with respect
to which the Award becomes vested pursuant to Paragraph 5(e), shall be determined
based upon the Compound Annual Growth Rates as of the date of the Change in Control
rather than on the basis of the Three-Year Cumulative Adjusted EPS and the Three-Year
Cumulative Adjusted Free Cash Flow, as determined in accordance with the following
and the Adjusted EBITDA Margin Performance Objective modifier shall equal Target
level or ___%:
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Performance Level | Compound Annual Growth Rate – Adjusted EPS | % of Restricted Stock Units Vesting |
Maximum | ___ percent | ___% |
Target | ___ percent | ___% |
Threshold | ___ percent | ___% |
Performance Level | Compound Annual Growth Rate – Adjusted Free Cash Flow | % of Restricted Stock Units Vesting |
Maximum | ___ percent | ___% |
Target | ___ percent | ___% |
Threshold | ___ percent | ___% |
If the Corporation’s performance falls within the range of the Threshold and Target or the
Target and Maximum achievement levels, then the number of Restricted Stock Units will
be calculated based on a linear interpolation between the ___% and ___% levels or the
___% and ___% levels, respectively.
The terms “Compound Annual Growth Rate – Adjusted EPS” and “Compound Annual
Growth Rate – Adjusted Free Cash Flow” shall mean the percentage determined by
subtracting one from the Applicable Root of the quotient determined by dividing the Final
Annual Adjusted EPS by the Initial Annual Adjusted EPS and the Final Annual Adjusted
Free Cash Flow by the Initial Annual Adjusted Free Cash Flow, respectively. For this
purpose:
(1)The term Final Annual Adjusted EPS shall mean the Corporation’s Adjusted EPS
for the 12-month period ending on the last day of the calendar month ending
immediately prior to the Change in Control (as determined by the Corporation).
(2)The term Final Annual Adjusted Free Cash Flow shall mean the Corporation’s
Adjusted Free Cash Flow for the 12-month period ending on the last day of the
calendar month ending immediately prior to the Change in Control (as
determined by the Corporation).
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(3)The term Initial Annual Adjusted EPS shall mean $___ per share and the term
Initial Annual Free Cash Flow shall mean $___ Million.
(4)The term “Applicable Root” shall mean (i) single root, if the Change in Control
occurs during the first 17 months of the Measurement Period, (ii) square root, if
the Change in Control occurs during the next 12 months of the Measurement
Period and (iii) cube root if the Change in Control occurs during the final 7
months of the Measurement Period.