FORMS OF RESTRICTED SHARES AGREEMENT EXHIBIT 10(n)
RESTRICTED SHARES AGREEMENT BETWEEN
21ST CENTURY INSURANCE GROUP,
A CALIFORNIA CORPORATION
AND _________________, AN EMPLOYEE
OF 21ST CENTURY INSURANCE GROUP
This Agreement is made at Woodland Hills, California, as of the ____ day of
_______________, by and between 21st Century Insurance Group, a California
corporation (the "Company") and _______________________ (the "Employee").
RECITAL OF FACTS
1. The Board of Directors of 21st Century Insurance Group (formerly,
20th Century Industries) at its meeting held on February 23, 1982 adopted,
subject to shareholder approval, the 20th Century Industries Restricted Shares
Plan, now the 21st Century Insurance Group Restricted Shares Plan (the "Plan").
The shareholders of the Company at their meeting held on May 25, 1982 approved
the Plan.
2. The Committee of the Board of Directors of 21st Century Insurance
Group designated to administer the Plan (the "Committee") has awarded ______
shares to the Employee pursuant to the Plan.
THEREFORE, it is agreed by and between the Company and the Employee, as
follows:
3. The Company has granted to the Employee _______ of the shares of the
Company without par value. The shares are evidenced by the following share
certificate(s), the restriction with respect to which expires on the date
indicated.
Share Certificate # # of Shares Restriction Expiration Date
------------------- --------------------- ---------------------------
___________________ _____________________ ___________, 20____
___________________ _____________________ ___________, 20____
Each of the share certificates will have attached the following restrictions.
The shares evidenced by this certificate are "restricted" pursuant to the
21st Century Insurance Group Restricted Shares Plan and may not be
transferred or reissued without the consent of the Company.
Attached to each share certificate is a stock assignment signed in blank by the
shareholder(s) and the signature of each shareholder is guaranteed by a bank or
a member of a national securities exchange or an officer of the Company. Such
guarantee is undated.
4. During the period of restriction and while subject to forfeiture,
the share certificates shall remain in the possession and custody of the
Company. If shares are forfeited, the Company may exercise the stock
assignment(s) provided for above, but upon delivery to the Employee of a share
certificate, the stock assignment pertaining thereto shall also be delivered to
the Employee.
5. If the Employee has been continuously employed by the Company from
the date hereof to the expiration of dates of the restrictions, the share
certificate for which the restrictions expire shall be delivered to the Employee
free of all restrictions other than those imposed, or made necessary by federal
and state securities laws. If the employment is terminated for any reason, all
shares not free of restrictions shall be forfeited in favor of the Company.
6. The Employee acknowledges that he or she has received from the
Company the Annual Report to shareholders for the year 20___ of the Company, the
Form 10-K filed with the United States Securities and Exchange Commission (the
"SEC") of the Company for the year 20___ and the report to shareholders for the
___ quarter of 20___. The Employee also acknowledges that there have been made
available to him or her for inspection, and copying if he or she so desires,
copies of prior reports to shareholders and filing with the SEC. Such right of
inspection and copying shall terminate if and when the employment of the
Employee terminates.
7. Attached hereto and made a part hereof, as though fully set forth
hereto, is a copy of the 21st Century Insurance Group Restricted Shares Plan.
In the event of any conflict between the terms and provisions of this Agreement
and those of the Plan, the terms and provisions of the Plan, including without
limitation, those with respect to powers of the Committee, shall prevail and be
controlling.
8. If the Employee exercises the election provided for in Section 83(b)
of the Internal Revenue Codes and Section 17122(b) of the Revenue and Taxation
Code of California, he or she shall promptly notify the Company.
9. Neither the Plan, this Agreement, nor the award of Restricted Shares
shall confer any right to continue in the employ of the Company or interfere in
any way the right of the Company to terminate any employment at any time.
10. The Employee shall furnish to the Company all information requested
at any time or from time to time by the Company to enable it to comply with any
reporting or other requirement imposed upon the Company by or under any
applicable statute or regulation.
11. No shares issued or transferred to an Employee, hereunder, so long
as such shares are subject to a risk of forfeiture imposed hereunder, may be
transferred, assigned, pledged, hypothecated or disposed of in any way (whether
by operation of law or otherwise) except shares upon forfeiture shall be
transferred back to the Company or to another Employee upon being regranted.
12. Nothing in the Plan or in this Restricted Shares Agreement entered
into pursuant to the Plan shall require the Company to issue or transfer any
shares pursuant to an award if such issuance or transfer would, in the opinion
of the Committee, constitute or result in a violation of any applicable statute
or regulation of any jurisdiction relating to the disposition of the securities.
13. If the Committee shall determine, in its discretion, that the
listing, registration or qualification of shares awarded hereunder upon any
securities exchange or under any applicable statute or regulation of any
jurisdiction relating to securities, or the consent or approval of any
governmental regulatory body, is necessary or desirable as a condition of, or in
connection with, the issuance or transfer of such shares, nothing in this
Restricted Shares Agreement shall require the Company to issue or transfer such
shares unless such listing, registration, qualification, consent or approval
shall have been effected or obtained free of any conditions not acceptable to
the Committee.
14. In connection with the shares awarded hereunder, it shall be a
condition precedent to the Company's obligation to evidence the removal of any
restrictions or transfer or lapse of any risk of forfeiture that the Employee
make arrangements satisfactory to the Company to insure that the amount of any
federal or other withholding tax required to be withheld with respect to such
sale or transfer on such removal or lapse is made available to the Company for
timely payment of such tax.
15. The Employee represents that he or she is having the shares issued
to him or her for his or her own account and not with a view to or for sale in
connection with any distribution of the shares.
16. Notwithstanding any other provision of this Agreement including,
but not limited to, paragraphs 3, 4, and 5 hereof, all shares which have been
granted pursuant to this Agreement which have not been delivered to the Employee
because of the expiration date of the Restrictions shall vest in the Employee
immediately before a "change of control" of the Company, as defined herein, free
and clear of any restrictions, except the restrictions imposed by paragraphs 12
through 15 hereof. A "change in control" shall be deemed to take place upon the
occurrence of any of the following:
(i) Any merger or consolidation of the Company with or into any other
person, as the result of which the holders of the Company's
Common Shares immediately prior to the transaction shall, on the
basis of such holding prior to such transaction, hold less than
50% of the total outstanding voting stock of the surviving
corporation immediately upon completion of the transaction.
(ii) Any sale or exchange of all or substantially all of the property
and assets of the Company.
(iii) Any change in a majority of the Board of Directors of the
Company occurring within a period of two years or less, such that
a majority of the Board of Directors is comprised of individuals
who are not "Continuing Directors". For purposes of the
foregoing, a "Continuing Director" shall be a director (a) who
was in office at the commencement of such period of two years or
(b) was elected subsequent to the commencement of such period
with the approval of not less than a majority of those directors
referred to in clause (a) who are then in office. Any director
meeting the qualifications of clause (b) of the previous sentence
shall, with respect to further determinations after the date of
such director's election, be deemed a director meeting the
qualifications of clause (a) of the previous sentence.
(iv) Any "person" [as defined in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")]
shall become the "beneficial owner" (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of a majority of
the Company's outstanding Common Stock.
(v) The liquidation or dissolution of the Company.
(vi) Any other transaction or reorganization similar to the foregoing
which in the opinion of the Committee constitutes a "change in
control" of the nature described in subparagraphs (i) through (v)
hereof.
17. The parties agree that Paragraph 16 hereof does not apply to any
action taken by American International Group, Inc. and/or its subsidiaries
("AIG") to become the sole shareholder or shareholders of the Company; provided,
however, that in the event of an offer by AIG to acquire all outstanding shares
of the Company that it does not yet own (an "AIG Offer"), any shares subject to
this Agreement which would vest within one year from the date of an AIG Offer
shall immediately vest in favor of Employee subject only to the provisions of
Paragraphs 12 through 15 hereof. Any remaining shares granted to the Employee
which are not free of the restrictions in paragraph 3, above, shall be forfeited
in favor of the Company.
Upon the shares vesting in the Employee pursuant to this paragraph, share
certificate(s) shall be delivered to the Employee pursuant to the procedures set
forth in paragraphs 4 and 5 hereof.
Executed at the place and as of the date first above written.
21ST CENTURY INSURANCE GROUP
By _____________________________________________
Xxxxx X. Xxxxxx
President and Chief Executive Officer
By _____________________________________________
Xxxxxxx X. Xxxxxxxxx, Secretary
EMPLOYEE
________________________________
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