EXHIBIT 10.16
XXXX CORPORATION
LONG-TERM STOCK INCENTIVE PLAN
2003 DEFERRAL AND RESTRICTED STOCK UNIT AGREEMENT - MSPP (US)
DEFERRAL AND RESTRICTED STOCK UNIT AGREEMENT (the "Agreement")
dated as of ______________, 2003 (the "Effective Date"), between Xxxx
Corporation ("Company") and the individual whose name appears on the signature
page hereof (the "Participant"), who is a key employee of the Company or an
Affiliate. Any term capitalized herein but not defined shall have the meaning
set forth in the Xxxx Corporation Long-Term Stock Incentive Plan (the "Plan").
1. Deferral Election.
(a) In accordance with the terms of the Plan, the Participant
hereby elects to defer:
(i) ____% (enter any percentage less than or equal to
100%), but not to exceed $_________, of the bonus
payable to the Participant under the Company's Senior
Executive Incentive Compensation Plan or Management
Incentive Compensation Plan paid in the first quarter
of 2004; and
(ii) ____ % (enter any percentage less than or equal to
90%), but not to exceed $_________, of the base
salary payable to the Participant for the pay periods
ending after December 31, 2003 and before January 1,
2005.
For the purposes of this Agreement, "base salary" shall mean a Participant's
annual base salary rate on January 1, 2004 from the Company or an Affiliate,
including any elective contributions of the Participant that are not includable
in his gross income under Code Sections 125 or 401(k), but before taking into
account any deferral under this Agreement.
2. Restricted Stock Units.
(a) In consideration for the Participant's deferral under Section
1(a), the Participant shall be credited as of March 15, 2004 with Restricted
Stock Units at a discounted price ("Discount Rate") as provided in the following
table:
TOTAL DOLLAR AMOUNT OF PARTICIPANT'S DEFERRALS
ELECTED UNDER SECTION 1(a), EXPRESSED AS A
PERCENTAGE OF THE PARTICIPANT'S BASE SALARY: APPLICABLE DISCOUNT RATE:
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15% or less 20%
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Over 15% and up to 100% 30%
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Over 100% 20%
(b) The total number of Restricted Stock Units credited to a
Participant under the Plan will be determined according to the following
calculation:
(i) the dollar amount deferred under Section 1(a) that
does not exceed 15% of the Participant's base salary,
divided by the product of the average Fair Market
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Value over the last five business days in 2003
(December 24, 26, 29, 30 and 31) (the "Average FMV")
multiplied by 80%; plus
(ii) the dollar amount deferred under Section 1(a) over
15% and up to 100% of the Participant's base salary,
divided by the product of the Average FMV multiplied
by 70%; plus
(iii) the dollar amount deferred under Section 1(a) over
100% of the Participant's base salary, divided by the
product of the Average FMV multiplied by 80%.
(c) The total number of Restricted Stock Units determined in
Section 2(b) will be credited to the Participant in the form of Bonus Restricted
Stock Units and/or Salary Restricted Stock Units. The number of Bonus Restricted
Stock Units credited shall be the same proportion of the total Restricted Stock
Units as the amount of bonus deferred in Section 1(a)(i) is of the total amount
deferred in Section 1(a). The number of Salary Restricted Stock Units credited
shall be the same proportion of the total Restricted Stock Units as the amount
of base salary deferred in Section 1(a)(ii) is of the total amount deferred in
Section 1(a).
3. Restriction Period. The Restriction Period under this
Agreement shall be the three-year period commencing on March 15, 2004 and ending
on March 14, 2007.
4. Dividend Equivalents. If the Company declares a cash dividend
on Shares, the Participant shall be credited with dividend equivalents under
this Agreement as of the payment date for the dividend equal to the amount of
the cash dividend per Share multiplied by the Restricted Stock Units credited to
the Participant under Section 2(b) through the record date. Dividend equivalents
shall be credited to a notional account established for the Participant
("Dividend Equivalent Account"). Interest shall be credited to the Participant's
Dividend Equivalent Account, compounded monthly, until payment of such account
to the Participant. The rate of such interest shall be the prime rate of
interest as reported by the Midwest edition of the Wall Street Journal for the
second business day of each quarter on an annual basis.
5. Timing and Form of Payout. Except as provided in Sections 6, 7
or 8, after the end of the Restriction Period, the Participant shall be entitled
to receive a number of Shares equal to the number of Restricted Stock Units
credited to the Participant under Section 2(b) and a cash payment equal to the
amount credited to the Participant's Dividend Equivalent Account under Section
4. Delivery of such Shares shall be made as soon as administratively feasible
after the end of the Restriction Period or such later date as may have been
elected by the Participant. Delivery of the cash payment of any amount credited
to the Participant's Dividend Equivalent Account shall be made as soon as
administratively feasible after the end of the Restriction Period.
6. Termination of Employment Due to Death, End of Service or
Disability.
(a) BEFORE MARCH 15, 2004. A Participant who ceases to be an
employee prior to March 15, 2004 by reason of death, End of Service or
Disability shall be terminated from the Plan, and his deferral election shall be
cancelled. Any base salary earned but not paid due to the Participant's deferral
election under Section 1(a)(ii) shall be paid to the Participant in cash as soon
as administratively feasible after his termination of employment.
(b) AFTER MARCH 14, 2004 BUT BEFORE JANUARY 1, 2005. If the
Participant ceases to be an employee after March 14, 2004 but prior to January
1, 2005 by reason of death, End of Service or Disability, the Participant (or in
the case of the Participant's death, the Participant's beneficiary) shall be
entitled to receive a number of Shares equal to the sum of (i) and (ii):
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(i) the number of Salary Restricted Stock Units credited
to the Participant under Section 2(c) multiplied by a
fraction, the numerator of which is the number of
full pay periods in the period beginning on January
1, 2004 and ending on the date the Participant ceases
to be an employee and the denominator of which is
twenty-four; and
(ii) the number of Bonus Restricted Stock Units credited
to the Participant under Section 2(c).
(c) AFTER DECEMBER 31, 2004. If the Participant ceases to be an
employee after December 31, 2004 but prior to the end of the Restriction Period
by reason of death, End of Service or Disability, the Participant (or in the
case of the Participant's death, the Participant's beneficiary) shall be
entitled to receive a number of Shares equal to the number of Restricted Stock
Units credited to the Participant under Section 2(b) and a cash payment equal to
the Participant's Dividend Equivalent Account under Section 4.
(d) BENEFICIARY. Any distribution made with respect to a
Participant who has died shall be paid to the beneficiary designated by the
Participant pursuant to Article 11 of the Plan to receive the Participant's
Shares and any cash payment under this Agreement. If the Participant's
beneficiary predeceases the Participant or no beneficiary has been designated,
distribution of the Participant's Shares and any cash payment shall be made to
the Participant's surviving spouse and if none, to the Participant's estate.
7. Involuntary Termination Other Than For Cause.
(a) BEFORE MARCH 15, 2004. A Participant whose employment
involuntarily terminates other than for Cause or any reason described in Section
6 prior to March 15, 2004 shall be terminated from the Plan, and his deferral
election shall be cancelled. Any base salary earned but not paid due to the
Participant's deferral election under Section 1(a)(ii) shall be paid to the
Participant in cash as soon as administratively feasible after his termination
of employment.
(b) AFTER MARCH 15, 2004 BUT BEFORE JANUARY 1, 2005. A Participant
whose employment involuntarily terminates other than for Cause or for any reason
described in Section 6 after March 15, 2004 but prior to January 1, 2005 shall
be entitled to receive a number of Shares equal to the sum of (i), (ii), (iii)
and (iv):
(i) the number of Salary Restricted Stock Units credited
to the Participant under Section 2(c) multiplied by a
fraction, the numerator of which is the number of
full pay periods in the period beginning on January
1, 2004 and ending on the date the Participant ceases
to be an employee, and the denominator of which is
twenty-four, multiplied by a fraction, the numerator
of which is the number of full months in the period
beginning on March 15, 2004 and ending on the date
the Participant ceases to be an employee (the
"Elapsed Months"), and the denominator of which is
36; and
(ii) the number of Bonus Restricted Stock Units credited
to the Participant under Section 2(c) multiplied by a
fraction, the numerator of which is the Elapsed
Months, and the denominator of which is 36; and
(iii) the lesser of:
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(A) the quotient of (i) the total amount of base
salary deferred under Section 1(a)(ii)
multiplied by a fraction, the numerator of
which is the number of full pay periods in
the period beginning on January 1, 2004 and
ending on the date the Participant ceases to
be an employee, and the denominator of which
is twenty-four, multiplied by a fraction,
the numerator of which is 36 minus the
Elapsed Months, and the denominator of which
is 36, divided by (ii) the Fair Market Value
of a Share on the date the Participant
ceases to be an employee, or
(B) the number of Salary Restricted Units
determined under Section 2(c) multiplied by
a fraction, the numerator of which is the
number of full pay periods in the period
beginning on January 1, 2004 and ending on
the date the Participant ceases to be an
employee, and the denominator of which is
twenty-four, multiplied by a fraction, the
numerator of which is 36 minus the Elapsed
Months, and the denominator of which is 36;
and
(iv) the lesser of:
(A) the quotient of (i) the amount of bonus
deferred under Section 1(a)(i) multiplied by
a fraction, the numerator of which is 36
minus the Elapsed Months, and the
denominator of which is 36, divided by (ii)
the Fair Market Value of a Share on the date
the Participant ceases to be an employee, or
(B) the number of Bonus Restricted Stock Units
determined under Section 2(c) multiplied by
a fraction, the numerator of which is 36
minus the Elapsed Months, and the
denominator of which is 36.
(c) AFTER DECEMBER 31, 2004. A Participant whose employment
involuntarily terminates other than for Cause or for any reason described in
Section 6 after December 31, 2004 but prior to the end of the Restriction Period
shall be entitled to receive a number of Shares equal to the sum of (i) and
(ii):
(i) the number of the Restricted Stock Units credited to
the Participant under Section 2(b) multiplied by a
fraction, the numerator of which is the Elapsed
Months, and the denominator of which is 36, and
(ii) the lesser of:
(A) the quotient of (i) the total amount
deferred under Section 1(a) multiplied by a
fraction, the numerator of which is 36 minus
the Elapsed Months, and the denominator of
which is 36, divided by (ii) the Fair Market
Value of a Share on the date the Participant
ceases to be an employee, or
(B) the number of Restricted Stock Units
determined under Section 2(b) multiplied by
a fraction, the numerator of which is 36
minus the Elapsed Months, and the
denominator of which is 36.
8. Termination of Employment for Any Other Reason.
(a) BEFORE MARCH 15, 2004. A Participant whose employment
terminates for any reason other than those described in Sections 6 and 7 prior
to March 15, 2004 shall be terminated from the Plan, and his deferral election
shall be cancelled. Any base salary earned but not paid due to the Participant's
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deferral election under Section 1(a)(ii) shall be paid to the Participant in
cash as soon as administratively feasible after his termination of employment.
(b) AFTER MARCH 14, 2004 BUT BEFORE JANUARY 1, 2005. A Participant
whose employment terminates for any reason other than those described in
Sections 6 and 7 after March 14, 2004 but prior to January 1, 2005 shall be
entitled to receive a number of Shares equal to the sum of (i) and (ii):
(i) the lesser of:
(A) the quotient of (i) the amount of base
salary the Participant elected to defer
under Section 1(a)(ii) multiplied by a
fraction, the numerator of which is the
number of full pay periods in the period
from January 1, 2004 to the date the
Participant ceases to be an employee, and
the denominator of which is twenty-four,
divided by (ii) the Fair Market Value of a
Share on the date the Participant ceases to
be an employee, or
(B) the number of Salary Restricted Stock Units
credited to the Participant under Section
2(c) multiplied by a fraction, the numerator
of which is the number of full pay periods
in the period from January 1, 2004 to the
date the Participant ceases to be an
employee, and the denominator of which is
twenty-four; and
(ii) the lesser of:
(A) the amount of bonus deferred under Section
1(a)(i) divided by the Fair Market Value of
a Share on the date the Participant ceases
to be an employee, or
(B) the number of Bonus Restricted Stock Units
credited to the Participant under Section
2(c).
(c) AFTER DECEMBER 31, 2004. A Participant whose employment
terminates for any reason other than those described in Sections 6 and 7 after
December 31, 2004 but prior to the end of the Restriction Period shall be
entitled to receive a number of Shares equal to the lesser of: the total amount
deferred under Section 1(a) divided by the Fair Market Value of a Share on the
date the Participant ceases to be an employee; or (ii) the number of Restricted
Stock Units credited to the Participant under Section 2(b).
9. Election to Defer Beyond Restriction Period. The Participant
may elect to defer delivery of any or all Shares due to him or her under this
Agreement to a date after the Restriction Period expires, by making a timely
deferral election. In his or her election to defer, the Participant may choose
between deferral to a particular calendar year, or to the year following his or
her termination of employment, but in no event may the Participant defer
delivery of a Share more than ten years beyond the expiration of the Restriction
Period under Section 3. If a Participant terminates employment with the Company
and all Affiliates for any reason other than End of Service (i) after the
Restriction Period expires and (ii) before the calendar year specified in a
deferral election, then he or she will be deemed to have elected to defer
delivery to the calendar year following his or her termination of employment. In
addition, if the Participant dies while employed with the Company or any
Affiliate, any Shares remaining to be paid in respect of this Agreement will be
paid to his or her beneficiary designated under the Plan as soon as practicable,
regardless of any outstanding election to defer. Xxxxxx whose receipt is
deferred under this Section 9 will be delivered on or about March 15 of the year
to which they were deferred. An election to
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defer will be considered timely only if it is filed at least one year and one
day in advance of the date the Restriction Period expires and the Participant
remains employed by the Company or an Affiliate for such period of a year and
one day.
10. Assignment and Transfers. The rights and interests of the
Participant under this Agreement may not be assigned, encumbered or transferred
except, in the event of the death of the Participant, by will or the laws of
descent and distribution.
11. Withholding Tax. The Company and any Affiliate shall have the
right to retain Shares that are distributable to the Participant hereunder to
the extent necessary to satisfy any withholding taxes, whether federal or state,
triggered by the distribution of Shares under this Agreement.
12. No Limitation on Rights of the Company. The grant of this
Agreement shall not in any way affect the right or power of the Company to make
adjustments, reclassification, or changes in its capital or business structure,
or to merge, consolidate, dissolve, liquidate, sell or transfer all or any part
of its business or assets.
13. Plan and Agreement Not a Contract of Employment. Neither the
Plan nor this Agreement is a contract of employment, and no terms of employment
of the Participant shall be affected in any way by the Plan, this Agreement or
related instruments except as specifically provided therein. Neither the
establishment of the Plan nor this Agreement shall be construed as conferring
any legal rights upon the Participant for a continuation of employment, nor
shall it interfere with the right of the Company or any Affiliate to discharge
the Participant and to treat him or her without regard to the effect that such
treatment might have upon him or her as a Participant.
14. Participant to Not Have Rights as a Stockholder. The
Participant shall not have rights as a stockholder with respect to any Shares
subject to this Agreement prior to the date on which he or she is recorded as
the holder of such Shares on the records of the Company.
15. Notice. Any notice or other communication required or
permitted hereunder shall be in writing and shall be delivered personally, or
sent by certified, registered or express mail, postage prepaid. Any such notice
shall be deemed given when so delivered personally or, if mailed, three days
after the date of deposit in the United States mail, in the case of the Company
to 00000 Xxxxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxx, 00000, Attention: General Counsel
and, in the case of the Participant, to its address set forth on the signature
page hereto or, in each case, to such other address as may be designated in a
notice given in accordance with this Section.
16. Governing Law. This Agreement shall be construed and enforced
in accordance with, and governed by, the laws of the State of Michigan,
determined without regard to its conflict of law rules.
17. Plan Document Controls. The rights herein granted are in all
respects subject to the provisions set forth in the Plan to the same extent and
with the same effect as if set forth fully herein. In the event that the terms
of this Agreement conflict with the terms of the Plan document, the Plan
document shall control.
[signature page follows]
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IN WITNESS WHEREOF, the Company and the Participant have duly
executed this Agreement as of the date first written above.
XXXX CORPORATION
By: ___________________________________
Its: ___________________________________
_______________________________________
[Participant's Signature]
Participant's Name and Address for
notices hereunder:
_______________________________________
_______________________________________
_______________________________________
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