STOCK UNIT AGREEMENT UNDER THE SCHOLASTIC CORPORATION 2001 STOCK INCENTIVE PLAN
Exhibit 10.10
STOCK UNIT AGREEMENT UNDER THE SCHOLASTIC
CORPORATION
2001 STOCK INCENTIVE PLAN
This Agreement (the “Agreement”) is entered into as of , by and between Scholastic Corporation (the “Company”) and (the “Participant”).
W I T N E S S E T H:
WHEREAS, the Company has adopted the Scholastic Corporation 2001 Stock Incentive Plan (the “Plan”), which is administered by a Committee appointed by the Company’s Board of Directors (the “Committee”); and
WHEREAS, pursuant to Section 3.3 of the Plan, the Committee also adopted guidelines for the grant of Stock Units under the Plan (the “Guidelines”), which constitute an Other Stock-Based Award under the Plan.
NOW, THEREFORE, for and in consideration of the mutual promises herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Grant of Stock Units.
Subject to the restrictions and other conditions set forth herein, the Committee has authorized this grant of Stock Units on _____________ (the “Grant Date”).
2. Vesting and Payment.
(a) Except as provided in Section 2(c) of this Agreement, 25% of the Award of Stock Units shall vest on a date that is thirteen months after the Grant Date (“Initial Vesting Date”) and an additional 25% of such Award of Stock Units shall vest on each succeeding anniversary of the Grant Date, provided that the Participant is continuously employed by the Company or any of its Affiliates (including any period during which the Participant is on leave of absence or any other break in employment in accordance with the Company’s policies and procedures) on each applicable vesting date.
(b) Except as provided in Section 2(c) and Section 2A.4 of this Agreement, a share of Common Stock shall be distributed with respect to each vested Stock Unit on the applicable vesting date.
(c) Upon a Termination of Employment or Termination of Consultancy (as applicable) by the Participant for Good Reason (which termination complies with the Guidelines’ notice, remedial period and timing of termination for Good Reason provisions), by the Company without Cause or as a result of the Participant’s death or Disability, all outstanding unvested Stock Units shall immediately vest and a share of Common Stock with respect to each Stock Unit shall be distributed within ninety
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Exhibit 10.10
(90) days following such termination; provided, however, that, if a Participant has made a deferral election with respect to such Award, the foregoing accelerated vesting and
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payment provisions shall not apply to the Award if the Participant’s Termination of Employment or Termination of Consultancy (as applicable) under the circumstances described herein occurs on or before the Initial Vesting Date; provided, further, however, that, the foregoing accelerated vesting and payment provisions shall apply to any unvested Stock Units covered by such Award if the Participant’s Termination of Employment or Termination of Consultancy (as applicable) under the circumstances described herein occurs after the Initial Vesting Date. Upon a Termination of Employment or Termination of Consultancy (as applicable) by reason of a Participant’s Retirement after the Initial Vesting Date of an Award, for a period of three years from the date of such Termination of Employment or Termination of Consultancy, unvested Stock Units will continue to vest and shares of Common Stock with respect to such Stock Units shall be distributed on the applicable vesting dates in accordance with the vesting schedule that would have been in effect but for the Termination of Employment or Termination of Consultancy; provided, however, that the foregoing provisions shall not apply if the Termination of Employment or Termination of Consultancy shall occur prior to the Initial Vesting Date of the Award. Notwithstanding the foregoing, to the extent required by Section 409A of the Code and the Treasury Regulations upon a Termination of Employment or Termination of Consultancy (other than as a result of death) of a Specified Employee, distributions determined, in whole or in part, to constitute “nonqualified deferred compensation” within the meaning of Section 409A of the Code shall be delayed until six months after such Termination of Employment or Termination of Consultancy if such termination constitutes a “separation from service” (within the meaning of Section 409A(a)(2)(A)(i) of the Code and the Treasury regulations issued thereunder) and such distribution shall be made at the beginning of the seventh month following the date of the Specified Employee’s Termination of Employment or Termination of Consultancy.
(d) Except as otherwise provided in Section 2(c) of this Agreement, Stock Units that are not vested as of the date of the Participant’s Termination of Employment or Termination of Consultancy for any reason shall terminate and be forfeited in their entirety as of the date of such termination. Stock Units that are vested as of the date of the Participant’s Termination of Employment or Termination of Consultancy, as applicable, shall be distributed to the Participant as of the date of such termination.
(e) Notwithstanding anything in these guidelines to the contrary, no distribution shall be made upon a Participant’s Termination of Employment or a Termination of Consultancy unless such termination constitutes a “separation from service” within the meaning of Section 409A(a)(2)(A)(i) of the Code and the Treasury regulations issued thereunder.
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2A. Deferral of Payment Date. |
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2A.1 Deferral Election. In accordance with the Guidelines, the Participant may, no later than 30 days after the Grant Date, elect to defer, for a period of time (expressed in whole years) of not less than five years, the scheduled payment dates of the Stock Units covered by the Award, |
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provided that: |
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(a) in order for a deferral election under this Section 2A.1 to be effective, the Participant must make the election at least twelve (12) months prior to the first date on which the first payment is scheduled to vest; |
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(b) a deferral election made by the Participant pursuant to this Section 2A.1 shall defer each scheduled payment date by the same period of time elected (e.g., if a Participant elects a deferral period of five years, the Stock Units scheduled to be paid on October 19, 2010 will be paid on October 19, 2015, the Stock Unites scheduled to be paid on September 19, 2011 will be paid on September 19, 2016, etc.); and |
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(c) the Participant may not elect a deferral period (expressed in whole years) that is less than five years, measured from each of the payment dates. |
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2A.2 Subsequent Deferral Elections. The Participant shall also be permitted to extend the deferred payment dates he or she elected pursuant to Section 2A.1, provided that: (a) in order to be effective, the Participant must make the subsequent deferral election at least twelve (12) months prior to the first scheduled deferred payment date; (b) a subsequent deferral election made by the Participant pursuant to this Section 2A shall defer each previously deferred payment date by the same period of time (expressed in whole years) of not less than five years; and (c) the Participant’s subsequent deferral election will not become effective until twelve (12) months after the date on which it is made. |
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2A.3 Procedures. The Participant must make any deferral election permitted under this section in writing on the election form and in accordance with the procedures established by the Company. A deferral election is valid solely with respect to the Stock Units identified on the election form and must comply with the requirements of Section 2A to be given effect. |
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2A.4 Deferred Distributions. If the Participant defers the payment of Stock Units under this section, the distribution of such units, to the extent vested, shall be made to the Participant on the earlier of: (a) the deferred payment date or (b) within 90 days following the Participant’s Termination of Employment or Termination of Consultancy, as applicable, subject to the special rules in such section applicable to distributions to Specified Employees. |
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2A.5 Section 409A. This Agreement is intended to comply with Section 409A of the Code and the Company shall construe, interpret and amend the provisions of this Agreement in such manner as the Company deems |
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necessary, in its sole discretion, to comply with Section 409A of the Code but in no event shall the foregoing provisions or any other provision of this Agreement, the Plan or the Guidelines be construed as a guarantee by the Company of any particular tax treatment. |
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3. Withholding.
Participant shall pay, or make arrangements to pay, in a manner satisfactory to the Company, an amount equal to the minimum amount of all applicable federal, state and local or foreign taxes that the Company is required to withhold at any time. In the absence of such arrangements, the Company or one of its Affiliates shall have the right to withhold such taxes from the Participant’s normal pay or other amounts payable to the Participant. In addition, any statutorily required withholding obligation may be satisfied, in whole or in part, at the Participant’s election, in the form and manner prescribed by the Committee, by delivery of shares of Common Stock (including shares issuable under this Agreement).
4. Plan and Guidelines.
In addition to the terms and conditions set forth herein, the Stock Units are subject to and governed by the terms and conditions set forth in the Plan and the Guidelines, which are hereby incorporated by reference. Unless otherwise indicated, any capitalized term used but not defined herein shall have the meaning ascribed to such term in the Plan and the Guidelines.
5. Restrictions on Sale.
Affiliates may resell Common Stock only pursuant to an effective registration statement under the Securities Act, pursuant to Rule 144 under the Securities Act, or pursuant to another exemption from registration under the Securities Act.
6. Amendment.
To the extent applicable, the Board or the Committee may at any time and from time to time amend, in whole or in part, any or all of the provisions of this Agreement to comply with Section 409A of the Code and the regulations thereunder or any other applicable law and may also amend, suspend or terminate this Agreement subject to the terms of the Plan.
7. Notices.
Any notice given hereunder shall be in writing and shall be deemed to have been duly given: (i) when delivered in person; (ii) two (2) days after being sent by United States mail; or (iii) on the first business day following the date of deposit if delivered by a nationally recognized overnight delivery service, to the appropriate party at the address set forth below (or such other address as the party shall from time to time specify): If to the Company, to:
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Scholastic
Corporation
000
Xxxxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Attention:
Corporate Secretary Department
If to the Participant, to the most recent address on file with the Company.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first set forth above.
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SCHOLASTIC CORPORATION |
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By: |
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Title: |
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PARTICIPANT |
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