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1997-2002 Grant
PERFORMANCE ACCELERATED
RESTRICTED STOCK AWARD AGREEMENT
(Performance-Based Vesting)
Agreement made as of the ___ day of ______________, by and between
XxXxxxxxx Xxxxxxx Corporation (hereinafter called the "Company") and [Employee
Name], (hereinafter called the "Employee").
RECITAL
The Employee is employed by the Company as [Employee Title] The Company desires
to provide equity ownership opportunities and performance-based incentives to
better match the interests of officers and key employees with those of
shareholders. The Employee desires to receive incentive compensation, the
vesting of which will be contingent upon the Company's achievement of certain
financial goals. Accordingly, the Company has agreed to grant certain of its
common shares of the Company to the Employee subject, however, to certain
restrictions.
In consideration of the mutual promises herein contained, the Company and
Employee agree as follows:
1. Agreement Subject to Plan. The Restricted Shares have been granted under
the XxXxxxxxx Xxxxxxx Corporation 1994 Performance and Equity Incentive
Plan (the "Plan"), a copy of which has been given to Employee and is
incorporated herein by this reference. This Agreement including the grant
of Restricted Shares hereunder is subject to the terms, conditions and
provisions of the Plan. Unless otherwise indicated, capitalized terms in
this Agreement shall have the same meaning ascribed to such terms in the
Plan.
2. Grant of Shares Subject to Restriction and Forfeiture. The Company hereby
grants to Employee [____] Shares (the "Restricted Shares") subject to the
restrictions and conditions contained herein and in the Plan (collectively,
the "Conditions"). Notwithstanding any other provision of this Agreement,
if the Committee determines that at any time prior to the date the
restrictions lapse in accordance with Section 5 hereof, either before or
after termination of employment, Employee has acted in a manner contrary to
the best interests of Company or any Affiliate, Employee shall forfeit all
Restricted Shares for which such restrictions have not lapsed. As a
condition precedent to the effectiveness of this Agreement, Employee shall
execute appropriate blank stock powers with respect to the Restricted
Shares and deliver such stock powers to the administrator of the Plan (the
"Plan Administrator"). Within one month after the date the Plan
Administrator receives such stock powers, stock certificates for the
Restricted Shares shall be issued (with an appropriate legend referring to
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the restrictions included in the Conditions) and deposited, together with
the stock powers with the Plan Administrator. The Plan Administrator shall
issue to the Employee a receipt evidencing any stock certificates
representing the Restricted Shares registered in the Employee's name and
held by the Plan Administrator. The Employee shall be entitled to delivery
of such stock certificate(s) upon satisfaction of the Conditions and only
in accordance with Section 6 hereof. Employee agrees that the Conditions
shall apply to the Restricted Shares and any shares or other securities
which Employee may receive or be entitled to receive as a result of the
ownership of the Restricted Shares whether the same are issued as a result
of a stock split, stock dividend, spin-off, split-up, spin-out,
recapitalization, merger, consolidation, reorganization, combination or
exchange of shares, or any other similar transaction, or as a result of the
merger or consolidation of the Company, or sale of assets of the Company,
or similar transaction.
3. Restrictions to Transfer. Employee hereby agrees that unless and until the
Conditions are satisfied or terminated as provided in Section 5 herein,
Employee will not sell, assign, transfer, pledge, encumber or otherwise
dispose of any of the Restricted Shares (each a "Transfer") without the
prior written consent of the Committee, and any such Transfer without such
consent shall be null and void ab initio.
4. Shareholder Rights. Except for the Conditions, the Employee shall have all
rights and privileges of a stockholder of the Company as to his or her
Restricted Shares, including the right to receive any dividends declared
with respect to such Restricted Shares and to exercise voting rights.
5. Lapse of Restrictions and Forfeiture of Shares. Restrictions shall be
satisfied and lapse and the Restricted Shares shall be subject to
forfeiture during a six-year performance period (the "Performance Period")
as follows:
(a) Initial Performance Period. The Initial Performance Period shall be
the three Fiscal Year period beginning with the Fiscal Year in which
this Agreement is executed. Restrictions shall be satisfied and lapse
after the Initial Performance Period in accordance with the following
schedule:
RONA
(as defined in Section 5(c)) Percentage of Restricted Shares
during Initial Performance Period upon which restrictions lapse
----------------------------------- --------------------------------
30.00% or less 0.00%
31.00% 20.00%
32.00% 40.00%
33.00% 60.00%
34.00% 80.00%
35.00% or more 100.00%
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(b) Second Performance Period. The Second Performance Period shall be the
three Fiscal Year period immediately following the Initial Performance
Period. Restricted Shares shall be forfeited after the Second
Performance Period in accordance with the following schedule:
RONA Forfeiture Percentage of
(as defined in Section 5(c)) Restricted Shares initially
during Second Performance Period granted hereunder
----------------------------------- -----------------------------
25.00% or less 100.00%
26.00% 90.00%
27.00% 80.00%
28.00% 70.00%
29.00% 60.00%
30.00% 50.00%
31.00% 40.00%
32.00% 30.00%
33.00% 20.00%
34.00% 10.00%
35.00% or more 0.00%
In no event, however, shall the number of Restricted Shares forfeited
after the Second Performance Period exceed the total number of
Restricted Shares initially granted hereunder less the number of
Restricted Shares upon which restrictions lapsed after the Initial
Performance Period in accordance with Section 5(a) of this Agreement.
Restrictions shall lapse on all Restricted Shares not so forfeited.
(c) Calculations. Calculations for vesting and forfeiture of Restricted
Shares between specified percentages shall be determined by linear
interpolation. Each of the calculations referred to in this Section 5
shall be rounded to the one-hundredth of one percent (0.01%) or to the
nearest whole share, as appropriate. RONA shall be calculated by
dividing earnings before interest and taxes by average net assets, in
each such case adjusted for unusual accounting and operational items
(such as the adoption of a new accounting standard, changes in
accounting, deferred production credits, and unusual or extraordinary
settlements of program claims, specifications and issues).
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(d) Performance-Based Restrictions. The award of the Restricted Shares is
intended to provide a performance-based incentive. Notwithstanding any
other provision of the Plan or this Agreement, the Committee does not
have the discretion to waive any of the performance-based restrictions
contained in this Agreement, and it may not accelerate the lapse of
restrictions other than in accordance with this Section or, in the
event Employee dies prior to the vesting or forfeiture of all
Restricted Shares granted hereunder, in accordance with Section 7 of
this Agreement; provided, however, that following any transaction
consummated pursuant to the Agreement and Plan of Merger which has
been entered into among The Boeing Company, West Acquisition
Corporation and the Company, dated as of December 14, 1996, the
Committee will have the discretion to adjust the performance criteria
to other performance or service-based factors if deemed necessary by
the Committee to more appropriately reflect the organizational
structure, characteristics, performance, and other attributes of the
merged company. In the event of a Change of Control, however, the
lapse of restrictions will be accelerated in accordance with Section 8
hereof.
6. Delivery of Share Certificates. As soon as practicable and in no event more
than three months after the end of the Initial Performance Period and the
Second Performance Period, the Committee shall calculate annualized RONA
and the number of Restricted Shares, if any, for which the restrictions
have lapsed or should be forfeited in accordance with Section 5 hereof. The
Committee shall promptly thereafter instruct the Plan Administrator to
deliver a stock certificate(s) representing the number of shares for which
restrictions have lapsed (to the nearest full share and cash for fractional
shares, if any), net of any shares withheld pursuant to Section 10, free of
the restrictions set forth in Section 3.
7. Termination of Employment. In the event Employee's employment by the
Company terminates for any reason prior to the vesting or forfeiture of all
Restricted Shares granted hereunder, the total number of Restricted Shares
granted hereunder may be reduced, rescinded or left unchanged, at the sole
discretion of the Committee. The number of Restricted Shares as and to the
extent so adjusted shall then vest or be forfeited in accordance with the
provisions of Section 5 hereof, provided, however, if Employee dies prior
to the vesting or forfeiture of all Restricted Shares granted under this
Agreement, the Committee may, in its sole discretion, accelerate the
vesting of the Restricted Shares as and to the extent so adjusted. If such
termination occurs after the Initial Performance Period or the Second
Performance Period has ended but before Shares have been delivered in
accordance with Section 6, such event shall not affect calculations, and
Shares will be delivered as soon as practical thereafter. In no event,
however, shall this Section cause Employee to forfeit Restricted Shares
which vested prior to the date of Employee's termination.
8. Effect of Change of Control. In the event of a Change of Control, all
restrictions and conditions applicable to the Restricted Shares will be
deemed to have been satisfied as of the date the Change of Control occurs;
provided, however, that any transaction or proposed transaction pursuant to
the Agreement and Plan of Merger which has been entered into among the
Boeing Company, West Acquisition Corporation and the Company, dated as of
December 14, 1996 shall not be treated as a Change of Control for the
purposes of this Agreement.
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9. Change of Duties. If in its sole discretion the Committee determines that,
subsequent to the date hereof, Employee's job responsibilities have been
significantly reduced, the Committee may reduce the number of Restricted
Shares granted hereunder.
10. Withholding. At such time as Share certificates are to be delivered to
Employee in accordance with Section 6 of this Agreement, the Company shall
satisfy the federal, state and local withholding requirements with respect
to such distribution. Such withholding can be satisfied at the Company's
option either by (i) the Company's withholding of Shares or (ii) by
requiring Employee's payment in cash in the required amount prior to
delivery of the Shares. Notwithstanding the foregoing, in the event
Employee is subject to Section 16 of the Exchange Act at the time of such
delivery, the Company shall withhold Shares in an amount equal to the
statutory minimum withholding amount.
11. Designation of Beneficiary. Employee may by written notice in form
reasonably acceptable to the Committee designate a beneficiary in
accordance with the terms and conditions of the Plan who will receive
Shares if and when Restrictions lapse if Employee has died prior to the
date(s) restrictions lapse.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and date set forth above.
XXXXXXXXX XXXXXXX CORPORATION
By:___________________________________________
Xxxxxx X. Xxxxxxxxx, Plan Administrator
___________________________________________
[Employee Name]
