EXHIBIT 10.5
UTi WORLDWIDE INC.
AMENDED AND RESTATED
2004 LONG-TERM INCENTIVE PLAN
-------------------------------
PERFORMANCE ENHANCEMENT AWARD AGREEMENT
------------------------------
AWARD NO.
You (the "Participant") are hereby awarded Performance Units subject
to the terms and conditions set forth in this Performance Enhancement Award
Agreement (the "Award") and in the UTi Worldwide Inc. Amended and Restated 2004
Long-Term Incentive Plan ("Plan"). A copy of the Plan is attached hereto as
Exhibit A. A summary of the Plan appears in its Prospectus, which is attached as
Exhibit B. This Award is conditioned on your execution of this Award and the
Non-Solicitation Agreement attached hereto as Exhibit C. You should carefully
review these documents, and consult with your personal legal and financial
advisor, in order to assure that you fully understand the terms, conditions, and
financial implications of this Award.
By executing these documents, you are agreeing to be bound
irrevocably by all of their terms and conditions as if they had been set out
verbatim in this Award. In addition, you recognize and agree that all
determinations, interpretations, or other actions respecting the Plan and this
Award will be made by the by the Board of Directors of UTi Worldwide Inc.
("Board") or any Committee appointed by the Board to administer the Plan, and
shall (unless arbitrary and capricious) be final, conclusive and binding on all
parties, including you and your successors in interest. Capitalized terms are
defined in the Plan or in this Award.
1. SPECIFIC TERMS OF YOUR AWARD. Your Award is being granted pursuant to
Article 10(b) of the Plan as a "Performance Compensation Award," and shall have
the following terms; subject, if you are a "covered employee" within the meaning
of Section 162(m) of the Code for a taxable year of the Company in which a
Performance Period ends, to the Committee's interpretation of the Plan and this
Award in any manner that the Committee may deem reasonably necessary or
appropriate in order for this Award to satisfy the requirements for
"performance-based compensation" within the meaning of Section 162(m)(4) of the
Code, and associated tax regulations and rulings:
Name of Participant
-------------------
Grant Date of Award
Maximum Number of Shares
Subject to Performance Units (may not exceed 200,000) _______________ ("Maximum Award"), which equals __% of
the Target Award.
Target Number of Shares Subject to Performance Units _______________ ("Target Award")
Performance Period
Performance Enhancement Award
UTi Worldwide Inc.
Amended and Restated 2004 Long-Term Incentive Plan
Page 2
Eligibility Thresholds and Performance The Eligibility Thresholds and Performance Goals based on free cash flow
Goals and earnings per share set forth on Schedule I attached hereto.
Requirements for Vesting Provided that all Eligibility Thresholds have been met or exceeded, as
of the last day of the Performance Period (subject to acceleration
pursuant to Section 2 or Section 3 below), you shall become vested, with
respect to the Target Number of Performance Units subject to this Award,
in the following percentage that corresponds to your achievement of the
specified Performance Goals:
% Vesting Performance Range Performance Level
---------- ----------------- -----------------
0% < __% of target Below minimum
__% __% of target Minimum
__% __% of target Target
[100 to 150]% __% of target Maximum
In its sole and absolute discretion, the Committee may adjust your
vesting percentage to take into account intermediate results between
Performance Levels, provided that your vesting percentage shall under no
event exceed __%.
2. ACCELERATED VESTING. If your Continuous Service ends due to your death
or because you become Disabled, you will become partially vested in the Shares
subject to this Award, provided that the Committee has determined that
performance is on track to meet the Performance Goals (and will forfeit all
other rights under this Award). The number of Shares in which your interest
vests will be determined by multiplying the total number of Shares subject to
this Award by a fraction having (a) a numerator equal to the number of full
months of your Continuous Service after the Grant Date, and (b) a denominator
equal to 36.
3. CHANGE IN CORPORATE CONTROL. The provisions of this paragraph shall
supersede any contrary or inconsistent provisions set forth in Section 13 of the
Plan. In the event of a Change in Control that is a permissible distribution
event under Code Section 409A(a)(2)(A)(v) (as determined by the Committee in its
sole discretion), you will become partially vested in the Shares subject to this
Award, to the extent allowable under Treasury Regulations under Section 409A of
the Code and provided that the Committee has determined that the organization is
on track to meet the Performance Goals. The number of Shares in which your
interest vests will be determined by multiplying the total number of Shares
subject to this Award by a fraction having (a) a numerator equal to the number
of full months of your Continuous Service between the Grant Date and the date of
the Change in Control, and (b) a denominator equal to 36. In addition, if the
unvested portion of this Award is assumed or substituted by a Successor
Corporation in a Change in Control that is a permissible distribution event
under Code Section 409A(a)(2)(A)(v) (as determined by the Committee in its sole
discretion), and your employment is Involuntarily Terminated by the Successor
Corporation in connection with, or within 12 months following consummation of,
the Change in Control, then the number of additional Shares in which your
interest vests pursuant to
2
Performance Enhancement Award
UTi Worldwide Inc.
Amended and Restated 2004 Long-Term Incentive Plan
Page 3
this Section 3 shall be determined by multiplying the total number of Shares
subject to this Award by a fraction having (a) a numerator equal to the lesser
of 12 and the number of months between the date of such termination and the end
of the Performance Period, and (b) a denominator equal to 36; provided, however,
that the Committee may decide, in its sole and absolute discretion, to
accelerate such vesting.
Notwithstanding the foregoing, if the Committee notifies you in writing
within 25 months after a Change in Control that you have violated the
Non-Solicitation Agreement attached as Exhibit C, the Company shall have the
right to coincidentally redeem any Shares in which your rights vested pursuant
to Section 2 or Section 3 hereof. The price payable to redeem such Shares will
be U.S. $1.00 per Share, and the Company shall enclose it with the written
notice referenced in the preceding sentence. By executing this Agreement, you
agree to execute any document that the Company considers reasonably necessary or
proper to consummate this redemption.
4. SATISFACTION OF VESTING RESTRICTIONS. No Shares will be issued before
you complete the requirements that are necessary for you to vest in the Shares
underlying your Performance Units. As soon as practicable after the date on
which your Award vests in whole or in part, the Company will issue to you or
your duly-authorized transferee, free from vesting restrictions (but subject to
Section 10 below and to such legends as the Company determines to be
appropriate), one Share for each vested Performance Unit. Fractional shares will
not be issued, and cash will be paid in lieu thereof. Notwithstanding the
foregoing, the Company will not issue Share certificates to you unless you have
made arrangements satisfactory to the Committee to satisfy any applicable tax
withholding obligations.
5. FAILURE OF VESTING RESTRICTIONS. By executing this Award, you
acknowledge and agree that:
(a) if your Continuous Service terminates under circumstances that do
not result in accelerated vesting pursuant to Section 2 or Section 3
above, you will irrevocably forfeit any and all rights under this
Award, and this Award will immediately become null, void, and
unenforceable; and
(b) if the Committee determines that the Performance Goals for any
Performance Period have not been fully satisfied, you will
irrevocably forfeit any and all rights with respect to the
Performance Units attributable to that Performance Period.
6. DIVIDENDS. When Shares are issued to you or your duly-authorized
transferee pursuant to the vesting of the Shares underlying your Performance
Units, you or your duly-authorized transferee shall also be entitled to receive,
with respect to each Share issued, an amount equal to any cash dividends (plus
simple interest at a rate of five percent per annum, or such other reasonable
rate as the Committee may determine) and a number of Shares equal to any stock
dividends, which were declared and paid to the holders of Shares between the
Grant Date and the date such Share is issued.
7. VOTING. With respect to the Shares to be issued and held by you
pursuant to this Award, you may not exercise voting rights until you become the
record owner of the Shares.
3
Performance Enhancement Award
UTi Worldwide Inc.
Amended and Restated 2004 Long-Term Incentive Plan
Page 4
8. INVESTMENT PURPOSES. By executing this Award, you represent and warrant
to the Company that any Shares issued to you pursuant to this Award will be for
investment for your own account and not with a view to, for resale in connection
with, or with an intent of participating directly or indirectly in, any
distribution of such Shares within the meaning of the Securities Act of 1933, as
amended.
9. SECTION 83(b) ELECTION NOTICE. If you provide the Company with prior
written notice of your intention to make an election under Section 83(b) of the
Internal Revenue Code of 1986, as amended, with respect to the Shares underlying
your Award (a "Section 83(b) election"), the Committee shall treat your
Performance Units as Restricted Stock Units, and accordingly convert your
Maximum Award of Performance Units into Restricted Shares, on a one-for-one
basis, pursuant to the terms of (and in full satisfaction of) this Award. You
agree to provide a copy of such election to the Company within 10 days after
filing that election with the Internal Revenue Service. Exhibit D contains a
suggested form of Section 83(b) election. Any Restricted Shares issued to you
pursuant to this Section 9 shall bear such legends as the Company determines to
be appropriate until all vesting restrictions lapse and replacement certificates
for unrestricted Shares are issued to you pursuant to Section 4 of this Award.
10. DEFERRAL ELECTION. At any time prior to the date that is six months
before the end of the Performance Period, provided that you have remained a
continuous employee of the Company since the date that the Performance Goals
were established by the Committee, you may irrevocably elect to defer the
receipt of all or a percentage of the Shares that would otherwise be issued to
you on the vesting of this Award. A copy of the form which you may use to make a
deferral election is attached hereto as Exhibit E. Notwithstanding the
foregoing, Shares which have been subject to a Section 83(b) election are not
eligible for deferral.
11. NOT A CONTRACT OF EMPLOYMENT. By executing this Award, you acknowledge
and agree that (i) any person who is terminated before full vesting of an award,
such as the one granted to you by this Award, could claim that he or she was
terminated to preclude vesting; (ii) you promise never to make such a claim;
(iii) nothing in this Award or the Plan confers on you any right to continue an
employment, service or consulting relationship with the Company, nor shall it
affect in any way your right or the Company's right to terminate your
employment, service, or consulting relationship at any time, with or without
Cause; and (iv) the Company would not have granted this Award to you but for
these acknowledgements and agreements.
12. SEVERABILITY. Subject to one exception, every provision of this Award
and the Plan is intended to be severable, and if any provision of the Plan or
this Award is held by a court of competent jurisdiction to be invalid and
unenforceable, the remaining provisions shall continue to be fully effective.
The only exception is that this Award shall be unenforceable if any provision of
the preceding section is illegal, invalid, or unenforceable.
13. NOTICES. Any notice or communication required or permitted by any
provision of this Award to be given to you shall be in writing and shall be
delivered personally or sent by certified mail, return receipt requested,
addressed to you at the last address that the Company had for you on its
records. Each party may, from time to time, by notice to the other party hereto,
specify a new address for delivery of notices relating to this Award. Any such
notice shall be deemed to be given as of the date such notice is personally
delivered or properly mailed.
4
Performance Enhancement Award
UTi Worldwide Inc.
Amended and Restated 2004 Long-Term Incentive Plan
Page 5
14. BINDING EFFECT. Every provision of this Award shall be binding on and
inure to the benefit the parties' respective heirs, legatees, legal
representatives, successors, transferees, and assigns.
15. HEADINGS. Headings shall be ignored in interpreting this Award.
16. COUNTERPARTS. This Award may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered shall be an
original, but all such counterparts shall together constitute the same
instrument.
17. PLAN GOVERNS. By signing this Award, you acknowledge that you have
received a copy of the Plan and that your Award is subject to all the provisions
contained in the Plan, the provisions of which are made a part of this Award and
your Award is subject to all interpretations, amendments, rules and regulations
which from time to time may be promulgated and adopted pursuant to the Plan. In
the event of a conflict between the provisions of this Award and those of the
Plan, the provisions of the Plan shall control. In addition, you recognizes and
agrees that all determinations, interpretations or other actions respecting the
Plan may be made by a majority of the Board or of the Committee in their sole
and absolute discretion, and that such determinations, interpretations or other
actions are (unless arbitrary and capricious) final, conclusive and binding upon
all parties, including you, your heirs, and representatives.
18. TAXES. If you are subject to taxation in the United States, by signing
this Award, you acknowledge that you shall be solely responsible for the
satisfaction of any federal, state, or local taxes that may arise with respect
to this Award (including any taxes arising under Sections 409A or 4999 of the
Code), and that neither the Company nor the Committee shall have any obligation
whatsoever to pay such taxes or to prevent you from occurring them. The Company
shall not have any obligation to pay, mitigate, or protect you from any such tax
liabilities. Nevertheless, if the Company reasonably determines that your
receipt of payments or benefits pursuant to Section 9 of the Plan would cause
you to incur liability for additional tax under Section 409A of the Code, then
the Company may in its discretion suspend such payments or benefits until the
end of the six-month period following termination of your service with the
Company (the "409A Suspension Period"). As soon as reasonably practical after
the end of the 409A Suspension Period, the Company shall make a lump sum payment
to you, in cash, in an amount equal to any payments and benefits that the
Company does not make during the 409A Suspension Period. Thereafter, you shall
receive any remaining payments and benefits due pursuant to Section 9 of the
Plan in accordance with the terms of that Section (as if there had not been any
suspension beforehand).
[signature page follows]
5
Performance Enhancement Award
UTi Worldwide Inc.
Amended and Restated 2004 Long-Term Incentive Plan
Page 6
BY YOUR SIGNATURE BELOW, along with the signature of the Company's
representative, you and the Company agree that this Award is being made under
and governed by the terms and conditions of this Award and the Plan.
UTi WORLDWIDE INC.
By: ________________________________________
Name:
Title:
The undersigned Participant hereby accepts the terms of this Award and the
Plan.
By: ________________________________________
Name of Participant: _______________________
6
UTi WORLDWIDE INC.
AMENDED AND RESTATED
2004 LONG-TERM INCENTIVE PLAN
EXHIBIT A
PLAN DOCUMENT
UTi WORLDWIDE INC.
AMENDED AND RESTATED
2004 LONG-TERM INCENTIVE PLAN
EXHIBIT B
PROSPECTUS
2
UTi WORLDWIDE INC.
AMENDED AND RESTATED
2004 LONG-TERM INCENTIVE PLAN
EXHIBIT C
NON-SOLICITATION AGREEMENT
UTi WORLDWIDE INC.
AMENDED AND RESTATED
2004 LONG-TERM INCENTIVE PLAN
EXHIBIT D
SECTION 83(b) ELECTION FORM
Attached is an Internal Revenue Code Section 83(b) Election Form. If
you wish to make a Section 83(b) election, you must do so within 30 days after
the date the Restricted Shares covered by the election were transferred to you.
In order to make the election, you must completely fill out the attached form
and file one copy with the Internal Revenue Service office where you file your
tax return. In addition, one copy of the statement also must be submitted with
your income tax return for the taxable year in which you make this election.
Finally, you also must submit a copy of the election form to the Company within
10 days after filing that election with the Internal Revenue Service. A Section
83(b) election normally cannot be revoked.
UTi WORLDWIDE INC.
ELECTION TO INCLUDE VALUE OF RESTRICTED SHARES IN GROSS INCOME
IN YEAR OF TRANSFER UNDER INTERNAL REVENUE CODE SECTION 83(b)
Pursuant to Section 83(b) of the Internal Revenue Code, I hereby elect
within 30 days after receiving the property described herein to be taxed
immediately on its value specified in item 5 below.
1. My General Information:
Name: ________________________________
Address: ________________________________
________________________________
S.S.N.
or T.I.N.: __________________________
2. Description of the property with respect to which I am making this
election:
____________________ ordinary shares of ___________ stock of UTi
Worldwide Inc. (the "Restricted Shares").
3. The Restricted Shares were transferred to me on ______________ ___, 20__.
This election relates to the 20____ calendar taxable year.
4. The Restricted Shares are subject to the following restrictions:
The Restricted Shares are forfeitable until they are earned in
accordance with Sections 1, 4, and 5 of the UTi Worldwide Inc.
Amended and Restated 2004 Long-Term Incentive Plan ("Plan"),
Performance Enhancement Award Agreement ("Award") or other Award or
Plan provisions. The Restricted Shares generally are not
transferable until my interest becomes vested and nonforfeitable,
pursuant to the Award and the Plan.
5. Fair market value:
The fair market value at the time of transfer (determined without
regard to any restrictions other then restrictions which by their
terms never will lapse) of the Restricted Shares with respect to
which I am making this election is $_____ per share.
6. Amount paid for Restricted Shares:
The amount I paid for the Restricted Shares is $____ per share.
7. Furnishing statement to employer:
A copy of this statement has been furnished to my employer,
______________. If the transferor of the Restricted Shares is not my
employer, that entity also has been furnished with a copy of this
statement.
8. Award or Plan not affected:
Nothing contained herein shall be held to change any of the terms or
conditions of the Award or the Plan.
Dated: ____________ __, 20__.
____________________________
Taxpayer
UTi WORLDWIDE INC.
AMENDED AND RESTATED
2004 LONG-TERM INCENTIVE PLAN
EXHIBIT E
DEFERRAL AND DISTRIBUTION ELECTION FORM
Attached is the form you may use if you wish to defer the receipt of all
or a percentage of the Shares that would otherwise be issued to you from the
vesting of your Award. You must submit a copy of the Deferral Election Form
executed by you to the Company as provided for in the form. An election to defer
receipt of your Shares may not be revoked.
You are advised to consult with your individual tax advisor with respect
to the tax consequences related to your Award and any elections you may make to
defer the receipt of Shares.
UTi WORLDWIDE INC.
AMENDED AND RESTATED
2004 LONG-TERM INCENTIVE PLAN
-----------------------------
DEFERRAL AND DISTRIBUTION ELECTION
-----------------------------
AGREEMENT, made this __ day of ________, ____, by and between me, as a
participant in the UTi Worldwide Inc. Amended and Restated Amended and Restated
2004 Long-Term Incentive Plan (the "Plan"), and UTi Worldwide Inc. (the
"Company"). This Agreement shall control the distribution of any of the
Company's ordinary shares ("Shares") that I become entitled to receive pursuant
to my Performance Enhancement Award Agreement having a grant date of ___________
__, ____ (the "Award Agreement"). We agree that any term that begins herein with
initial capital letters shall have the special meaning defined in the Plan or
the Award Agreement, unless the context clearly requires otherwise.
*** ELECTION TIMING REQUIREMENT ***. I understand and agree that this
election will be ineffective if it is made after the date that is six months
prior to the end of the Performance Period.
1. Deferral Election. Pursuant to Section 10 of the Award Agreement, I
hereby irrevocably elect to defer the receipt of _____% of the Shares that would
otherwise be issued to me at any time or from time to time pursuant to the Award
Agreement. I recognize and agree that the Company will establish an Account for
me under the Plan, and will credit that account with Deferred Share Units
pursuant to Section 9 of the Plan.
2. Nature of Distribution. I recognize that distributions from my Account
will be made in the form of (i) one Share for each Deferred Share Unit credited
to my Account, and (ii) with respect to each Share issued to me, a cash payment
equal to any cash dividends (plus simple interest at 5% per annum), and
additional Shares representing any Share dividends, that were declared and paid
to holders of Shares between the Grant Date and the date such Share is issued to
me.
3. Timing and Form of Distributions. I hereby elect to commence receiving
distributions from my Account on the earliest of the events checked in the table
on the following page (but not earlier than six months after my termination of
service with the Company if the Committee determines that an earlier
commencement date would violate Section 409A of the Code):
EVENT FORM OF DISTRIBUTION TIME OF DISTRIBUTION
------------------- ----------------------------------------------- ---------------------------------
__ Death [ ] One lump sum distribution. [ ] As soon as practicable.
[ ] Substantially equal annual payments [ ] The next January 1st.
over a period of ___ years (up to 10).
[ ] Other:____________.
__ Disability [ ] One lump sum distribution. [ ] As soon as practicable.
[ ] Substantially equal annual payments [ ] The next January 1st.
over a period of ___ years (up to 10).
[ ] Other:____________.
__ Other Separation [ ] One lump sum distribution. [ ] As soon as practicable.
from Service
[ ] Substantially equal annual payments [ ] The next January 1st.
over a period of ___ years (up to 10).
[ ] Other:____________.
__ Change in Control [ ] One lump sum distribution. [ ] As soon as practicable.
that is a
permissible [ ] Substantially equal annual payments [ ] The next January 1st.
distribution event over a period of ___ years (up to 10).
under Section [ ] Other:____________.
409A(a)(2)(A)(v) of
the Code
__ Specified Date [ ] One lump sum distribution.
[ ] Substantially equal annual payments Date: ________ ___, ___.
over a period of ___ years (up to 10).
4. Form of Payment to Beneficiary. In the event of my death before
collecting all of my Account, any remaining portion of my Account shall be
distributed to my beneficiary or beneficiaries named below in the following
manner--
[ ] in a single lump sum to be distributed as soon as
administratively practicable following my death.
[ ] in accordance with the payment schedule selected in paragraph
3 hereof (with payments made as though I survived to collect
all
benefits, and as though I terminated service on the date of my
death if payments had not already begun).
5. Designation of Beneficiary. In the event of my death before I have
collected all of my Account, I hereby direct that my beneficiaries shall be as
follows:
a. Primary Beneficiary. I hereby designates the person(s) named below to
be my primary beneficiary and to receive the balance of any unpaid portion of my
Account.
Name of Social Security Percentage of
Primary Beneficiary Number Mailing Address Death Benefit
------------------- ---------------- --------------- -------------
%
%
b. Contingent Beneficiary. In the event that a primary beneficiary or
beneficiaries named above are not living at the time of my, I hereby designate
the following person(s) to be my contingent beneficiary for purposes of the
Plan:
Name of Social Security Percentage of
Contingent Beneficiary Number Mailing Address Death Benefit
---------------------- --------------- --------------- --------------
%
%
6. Effect of Elections. I understand and acknowledge that the election
made in paragraph 1 hereof shall be irrevocable with respect to compensation
subject to such election and shall continue in full force until either the
effective date of a superseding written election made by me, or until my role as
a director of the Company is terminated, or until the Plan is terminated by
appropriate corporate action, whichever shall occur first. My elections in
paragraphs 4 and 5 shall be revocable until my death, at which time they become
irrevocable
7. Changing of Elections. I recognize that I may, by submitting an
effective superseding election, file new elections under paragraph 3. Such
superseding election shall be effective on the first day of the 13th month after
I make such election only if (i) I make the election at least 12 months prior to
the date that the Shares would have been distributed (or begun to be
distributed) to me pursuant to my initial election and (ii) the election defers
my receipt of Shares for at least 5 years from the date that the Shares would
have been distributed (or begun to be distributed) to me pursuant to my initial
election.
8. Satisfaction of Award Commitments. The parties recognize and agree that
the Company will have fully honored and discharged its obligations under this
Agreement, the Award Agreement,
and the Plan if the Company distributes my Account in accordance with the
provisions hereof.
[signature page follows]
UTi WORLDWIDE INC. PARTICIPANT
By _______________________________ ________________________________
A duly authorized officer or director
DATE: ____________________________ DATE: _________________________
