Second Amended and Restated Cabot Microelectronics Corporation 2000 Equity Incentive Plan [Initial][Annual] Restricted Stock Award Agreement for Directors
Exhibit 10.6
Second
Amended and Restated
Cabot
Microelectronics Corporation 2000 Equity Incentive Plan
[Initial][Annual]
Restricted Stock Award Agreement for Directors
[AWARD
DATE]
[NAME]
[ADDRESS]
[CITY,
STATE, ZIP]
Dear
FIRST NAME:
I am
pleased to inform you (the “Participant”) that the Board of Directors (the
“Board”) of Cabot Microelectronics Corporation (the “Company”), based on the
recommendation of the Nominating and Corporate Governance Committee of the
Board, has approved your participation in the Second Amended and Restated Cabot
Microelectronics Corporation 2000 Equity Incentive Plan, as amended and restated
September 23, 2008 (the "Plan") in consideration of your [initial[annual]
service as a Director of the Company. A Restricted Stock Award (the
“Award”) is hereby awarded to the Participant pursuant to the terms of the Plan
and this Restricted Stock Agreement (the “Agreement”). A copy of the
Plan is enclosed.
|
Participant
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Type
of Award
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Number
of Restricted Shares Awarded
|
Fair
Market Value of Restricted Shares on Date of Award, [Annual Meeting for
Annual; Date of Election/ Appointment for Initial]
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Participant
ID Number
|
|
[NAME]
|
Restricted
Stock
|
[______]
|
[Fmv/closing
price on Award Date]
$XX.XX
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[xxx-xx-xxxx]
|
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Date
of Award [AD]
|
Date
Restrictions Lapse (Vesting Date(s))
[equally,
in quarters, over 4 yrs., beginning on first anniversary, for annual;
equally, in quarters, over 3 yrs., beginning on AD, for
initial]]
|
Award
Number
|
||
|
[Annual
Meeting Date for Annual][Date of Appointment for Initial]
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25%
[1st
anniv. AD]; [AD]
25%
[2d anniv. AD];[1st
xxxxx.XX]
25%[3d
anniv. AD];[0xxxxxx.XX]
25%[4th
anniv. AD];[0xxxxxx.XX]
|
[xxxxx]
|
This Agreement provides the
Participant with the terms of the Award granted to the Participant. The terms
specified in this Agreement are governed by the provisions of the Plan, which
are incorporated herein by reference. The Compensation Committee of the Board
(the “Committee”) has the exclusive authority to interpret and apply the Plan
and this Agreement. Any interpretation of the Agreement by the
Committee and any decision made by it with respect to the Agreement are final
and binding on all persons. To the extent that there is any conflict
between the terms of this Agreement and the Plan, the Plan shall govern.
Capitalized terms used herein will have the same meaning as under the Plan,
unless stated otherwise.
In
consideration of the foregoing and the mutual covenants hereinafter set forth,
it is agreed by and between the Company and the Participant, as
follows:
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1.
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Vesting Dates and
Lapse of Restrictions. The Award shall become vested and
the restrictions will lapse in accordance with the following
table:
|
|
Number
of Shares
|
Vesting
Date(s)
[equally,
in quarters, over 4 years, beginning on first anniversary for annual;
equally, in quarters, over 3 years, beginning on AD for
initial]
|
|
25%
25%
25%
25%
|
[1st
anniv. AD]; [AD]
[2d
anniv. AD]; [1st
anniv. AD]
[3d
anniv. AD]; [2d anniv. AD]
[4th
anniv. AD]; [3d anniv. AD]
|
The Award
will be fully vested and all restrictions shall lapse in the event of the
Participant’s death, Disability or a Change in Control, as defined in the
Plan. Upon the Participant’s termination of Service as a Director of
the Company for any reason other than death or Disability, the Participant shall
immediately cease vesting in the Award and the unvested portion of the Award
shall be forfeited immediately.
For
purposes hereof, “Disability” shall have the meaning of permanent and total
disability provided within the meaning of Section 22(e)(3) of the Internal
Revenue Code.
1
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2.
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Termination /
Cancellation / Rescission. The Company may terminate,
cancel, rescind or recover the Award immediately under certain
circumstances, including, but not limited to, the
Participant’s:
|
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(a)
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actions
constituting Cause, as defined in the Plan, or the Company’s By-laws or
Articles of Incorporation, as
applicable;
|
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(b)
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rendering
of services for a competitor prior to, or within six (6) months after, the
exercise of any Award or the termination of Participant's Service with the
Company;
|
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(c)
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unauthorized
disclosure of any confidential/proprietary information of the Company to
any third party.
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In the
event of any such termination, cancellation, rescission or revocation, the
Participant must return any Stock obtained by the Participant pursuant to the
Award, or pay to the Company the amount of any gain realized on the sale of such
Stock, and the Company shall be entitled to set-off against the amount of any
such gain any amount owed to the Participant by the Company. To the
extent applicable, the purchase price for such Stock shall be returned to the
Participant, including any withholding requirements.
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3.
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Rights and
Restrictions Governing Restricted Stock. As of the Date
of Award, one or more certificates representing the appropriate number of
shares of Stock granted to the Participant shall be registered in the
Participant’s name but shall be held by the Company for the Participant’s
account. The Participant shall have all rights of a holder as
to such shares of Stock (including, to the extent applicable, the right to
receive dividends and to vote), subject to the following
restrictions: (a) the Participant has executed a valid stock
power on behalf of the Company for such Stock; (b) the Participant shall
be entitled to delivery of certificates representing shares of Stock when
restrictions lapse; and (c) none of the Stock may be sold, transferred,
assigned, pledged or otherwise encumbered or disposed of until the
restrictions have lapsed.
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4.
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Delivery of Restricted
Stock. As soon as reasonably practicable following the
date on which restrictions lapse, one or more stock certificates for the
appropriate number of shares of Stock, free of the restrictions set forth
in the Agreement, shall be delivered to the Participant or such shares
shall be credited to a brokerage account if the Participant so directs;
provided however, that such certificates shall bear such legends as the
Committee, in its sole discretion, may determine to be necessary or
advisable in order to comply with applicable federal and state securities
laws.
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5.
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Tax Treatment.
The Participant will be taxed on the difference between any purchase price
and the Fair Market Value of the Stock on the date the restrictions lapse.
This income will be taxed as ordinary income but will not subject to any
withholding taxes. Instead, the Participant is required to pay any
applicable taxes to the appropriate tax authorities
directly. The income will be reported to the Participant as
part of the Participant’s fees on the Participant’s annual Form 1099
issued by the Company.
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The
Participant may elect to make an election under Section 83(b) of the Code to
have any ordinary income amount taxed currently, before any restrictions
lapse. This election must be filed within thirty (30) days of the
Date of Award. Attached hereto is a form of election for this
purpose.
If the
Participant sells the Stock acquired under the Award, a long-term or short-term
capital gain or loss will result depending on: (a) the holding period
for the shares, and (b) the difference between the Fair Market Value of the
shares at the time of the sale and the Participant’s tax basis in the
shares. The holding period is determined from the date the
restrictions lapse. Under current law the capital gain or loss is
long term if the property is held for more than one (1) year, and short term of
the property is held for less than one year. The tax basis of the
shares is the sum of (a) any purchase price paid for the shares, and (b) the
ordinary income, if any, determined by the difference between the Fair Market
Value of the shares when the restrictions lapse or an 83(b) election is made,
and any purchase price.
EACH
PARTICIPANT IS URGED TO CONSULT WITH HIS OR HER OWN TAX ADVISOR TO DETERMINE THE
PARTICULAR TAX CONSEQUENCES INCLUDING THE APPLICABILITY AND EFFECT OF FEDERAL,
LOCAL AND OTHER TAX LAWS.
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6.
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Tax
Withholding. All deliveries and distributions under this
Agreement are not subject to tax withholding unless required under
applicable law. Notwithstanding, the Participant voluntarily
may elect to have the Company withhold any applicable taxes in accord with
and as permitted by Section 8.4 of the Plan. As a Director of
the Company, the Participant is subject to Section 16 (an “Insider”), of
the Securities Exchange Act of 1934 (“Exchange Act”), and any surrender of
previously owned shares to satisfy tax withholding obligations arising
under an Award must comply with the requirements of Rule 16b-3 promulgated
under the Exchange Act (“Rule 16b-3”), and any other relevant law,
regulations and Company guidelines.
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2
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7.
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Transferability. The
Award Stock is not transferable other than: (a) by will or by the laws of
descent and distribution; (b) pursuant to a domestic relations order; or
(c) to members of the Participant’s immediate family, to trusts solely for
the benefit of such immediate family members or to partnerships in which
family members and/or trusts are the only partners, all as provided under
the terms of the Plan. After any such transfer, the Award Stock
shall remain subject to the terms of the
Plan.
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8.
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Adjustment of
Shares. In the event of any transaction described in
Section 8.6 of the Plan, the terms of this Award (including, without
limitation, the number and kind of shares subject to this Award) shall be
adjusted as set forth in Section 8.6 of the
Plan.
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9.
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Not an Employment
Contract. The Company’s grant of the Award does not
confer any contractual or other rights of employment or service with the
Company.
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10.
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Severability. In
the event that any provision of this Agreement is found to be invalid,
illegal or incapable of being enforced by any court of competent
jurisdiction for any reason, in whole or in part, the remaining provisions
of this Agreement shall remain in full force and effect to the fullest
extent permitted by law.
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11.
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Waiver. Failure
to insist upon strict compliance with any of the terms and conditions of
this Agreement or the Plan shall not be deemed a waiver of such term or
condition.
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12.
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Notices. Any
notices provided for in this Agreement or the Plan must be in writing and
hand delivered, sent by fax or overnight courier, or by postage paid first
class mail. Notices are to be sent to the Participant at the
address indicated by the Company’s records and to the Company at its
principal executive office.
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13.
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Governing
Law. This Agreement shall be construed under the laws of
the State of Illinois.
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IN
WITNESS WHEREOF, the Company has caused this Agreement to be executed in its
name and on its behalf, all as of the Date of Award.
CABOT
MICROELECTRONICS CORPORATION
Xxxxxxx X. Xxxxxxx
President
and Chief Executive Officer
3
