TERREMARK WORLDWIDE, INC. RESTRICTED STOCK AGREEMENT FOR [EMPLOYEE NAME]
Exhibit 10.40
TERREMARK WORLDWIDE, INC.
FOR
[EMPLOYEE NAME]
1. Award of Restricted Stock. The Committee hereby grants, as of _______________ (the “Date of
Grant”), to [EMPLOYEE NAME] restricted shares of the Company’s Common Stock, par value $.001 per
share (collectively the “Restricted Stock”). The Restricted Stock shall be subject to the terms,
provisions and restrictions set forth in this Agreement and the Company’s 2005 Executive Incentive
Compensation Plan (the “Plan”), which is incorporated herein for all purposes. As a condition to
entering into this Agreement, and as a condition to the issuance of any Shares (or any other
securities of the Company), the Recipient agrees to be bound by all of the terms and conditions
herein and in the Plan. Unless otherwise provided herein, terms used herein that are defined in
the Plan and not defined herein shall have the meanings attributable thereto in the Plan.
2. Vesting of Restricted Stock.
(a) Except as otherwise provided in Sections 2(b), [2(c),] 2(d), and 4 hereof, the shares of
Restricted Stock shall become vested in the following amounts, at the following times and upon the
following conditions, provided that the Continuous Service of the Recipient continues through and
on the applicable Vesting Date:
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[
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There shall be no proportionate or partial vesting of shares of Restricted Stock in or during
the months, days or periods prior to each Vesting Date, and all vesting of shares of Restricted
Stock shall occur only on the applicable Vesting Date.
(b) In the event that a Change in Control of the Company occurs during the Recipient’s Continuous
Service, the shares of Restricted Stock subject to this Agreement shall become immediately vested
as of the date of the Change in Control.
(c) In the event that the Recipient’s Continuous Service terminates by reason of the Recipient’s
Disability or death, all of the shares of Restricted Stock subject to this Agreement shall be
immediately vested as of the date of such Disability or death, whichever is applicable, and shall
be delivered, subject to any requirements under this Agreement, to the Recipient, in the
event of his or her Disability, or in the event of the Recipient’s death, to the beneficiary
or beneficiaries designated by the Recipient, or if the Recipient has not so designated any
beneficiary(ies), or no designated beneficiary survives the Recipient, such shares shall be
delivered to the personal representative of the Recipient’s estate.
(d) Notwithstanding any other term or provision of this Agreement, the Board or the Committee
shall be authorized, in its sole discretion, based upon its review and evaluation of the
performance of the Recipient and of the Company, to accelerate the vesting of any shares of
Restricted Stock under this Agreement, at such times and upon such terms and conditions as the
Board or the Committee shall deem advisable.
(e) For purposes of this Agreement, the following terms shall have the meanings indicated:
(i) “Non-Vested Shares” means any portion of the Restricted Stock subject to this Agreement
that has not become vested pursuant to this Section 2.
(ii) “Vested Shares” means any portion of the Restricted Stock subject to this Agreement that
is and has become vested pursuant to this Section 2.
3. Delivery of Restricted Stock.
(a) One or more stock certificates evidencing the Restricted Stock shall be issued in the name of the
Recipient but shall be held and retained by the Records Administrator of the Company until the date
(the “Applicable Date”) on which the shares (or a portion thereof) subject to this Restricted Stock
award become Vested Shares pursuant to Section 2 hereof, subject to the provisions of Section 4
hereof. All such stock certificates shall bear the following legends, along with such other
legends that the Board or the Committee shall deem necessary and appropriate or which are otherwise
required or indicated pursuant to any applicable stockholders agreement:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO SUBSTANTIAL VESTING AND
OTHER RESTRICTIONS AS SET FORTH IN THE RESTRICTED STOCK AGREEMENT BETWEEN THE ISSUER
AND THE ORIGINAL HOLDER OF THE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE
PRINCIPAL OFFICE OF THE ISSUER. SUCH RESTRICTIONS ARE BINDING ON TRANSFEREES OF
THESE SHARES, AND INCLUDE VESTING CONDITIONS WHICH MAY RESULT IN THE COMPLETE
FORFEITURE OF THE SHARES.
(b) The Recipient shall deposit with the Company stock powers or other instruments of transfer or
assignment, duly endorsed in blank with signature(s) guaranteed, corresponding to each certificate
representing shares of Restricted Stock until such shares become Vested Shares. If the Recipient
shall fail to provide the Company with any such stock power or other instrument of transfer or
assignment, the Recipient hereby irrevocably appoints the Secretary of the Company as his
attorney-in-fact, with full power of appointment and substitution, to execute and
deliver any such power or other instrument which may be necessary to effectuate the transfer
of the Restricted Stock (or assignment of distributions thereon) on the books and records of the
Company.
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(c) On or after each Applicable Date, upon written request to the Company by the Recipient, the
Company shall promptly cause a new certificate or certificates to be issued for and with respect to
all shares that become Vested Shares on that Applicable Date, which certificate(s) shall be
delivered to the Recipient as soon as administratively practicable after the date of receipt by the
Company of the Recipient’s written request. The new certificate or certificates shall continue to
bear those legends and endorsements that the Company shall deem necessary or appropriate (including
those relating to restrictions on transferability and/or obligations and restrictions under the
Securities Laws).
4. Forfeiture of Non-Vested Shares. If the Recipient’s Continuous Service with the Company and the
Related Entities is terminated for any reason, any Shares of Restricted Stock that are not Vested
Shares, and that do not become Vested Shares pursuant to Section 2 hereof as a result of such
termination, shall be forfeited immediately upon such termination of Continuous Service and revert
back to the Company without any payment to the Recipient. The Committee shall have the power and
authority to enforce on behalf of the Company any rights of the Company under this Agreement in the
event of the Recipient’s forfeiture of Non-Vested Shares pursuant to this Section 4.
5. Rights with Respect to Restricted Stock.
(a) Except as otherwise provided in this Agreement, the Recipient shall have, with respect to all
of the shares of Restricted Stock, whether Vested Shares or Non-Vested Shares, all of the rights of
a holder of shares of common stock of the Company, including without limitation (i) the right to
vote such Restricted Stock, (ii) the right to receive dividends, if any, as may be declared on the
Restricted Stock from time to time, and (iii) the rights available to all holders of shares of
common stock of the Company upon any merger, consolidation, reorganization, liquidation or
dissolution, stock split-up, stock dividend or recapitalization undertaken by the Company;
provided, however, that all of such rights shall be subject to the terms, provisions, conditions
and restrictions set forth in this Agreement (including without limitation conditions under which
all such rights shall be forfeited). Any Shares issued to the Recipient as a dividend with
respect to shares of Restricted Stock shall have the same status and bear the same legend as the
shares of Restricted Stock and shall be held by the Company, if the shares of Restricted Stock that
such dividend is attributed to is being so held, unless otherwise determined by the Committee. In
addition, notwithstanding any provision to the contrary herein, any cash dividends declared with
respect to shares of Restricted Stock subject to this Agreement shall be held in escrow by the
Committee until such time as the shares of Restricted Stock that such cash dividends are attributed
to shall become Vested Shares, and in the event that such shares of Restricted Stock are
subsequently forfeited, the cash dividends attributable to such portion shall be forfeited as well.
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(b) If at any time while this Agreement is in effect (or shares granted hereunder shall be or
remain unvested while Recipient’s Continuous Service continues and has not yet
terminated or ceased for any reason), there shall be any increase or decrease in the number of
issued and outstanding Shares of the Company through the declaration of a stock dividend or through
any recapitalization resulting in a stock split-up, combination or exchange of such Shares, then
and in that event, the Board or the Committee shall make any adjustments in a fair and appropriate,
in view of such change, in the number of shares of Restricted Stock then subject to this Agreement.
If any such adjustment shall result in a fractional share, such fraction shall be disregarded.
(c) Notwithstanding any term or provision of this Agreement to the contrary, the existence of this
Agreement, or of any outstanding Restricted Stock awarded hereunder, shall not affect in any manner
the right, power or authority of the Company to make, authorize or consummate: (i) any or all
adjustments, recapitalizations, reorganizations or other changes in the Company’s capital structure
or its business; (ii) any merger, consolidation or similar transaction by or of the Company; (iii)
any offer, issue or sale by the Company of any capital stock of the Company, including any equity
or debt securities, or preferred or preference stock that would rank prior to or on parity with the
Restricted Stock and/or that would include, have or possess other rights, benefits and/or
preferences superior to those that the Restricted Stock includes, has or possesses, or any
warrants, options or rights with respect to any of the foregoing; (iv) the dissolution or
liquidation of the Company; (v) any sale, transfer or assignment of all or any part of the stock,
assets or business of the Company; or (vi) any other corporate transaction, act or proceeding
(whether of a similar character or otherwise).
6. Transferability. Unless otherwise determined by the Committee, the shares of Restricted Stock are
not transferable unless and until they become Vested Shares in accordance with this Agreement,
otherwise than by will or under the applicable laws of descent and distribution. The terms of this
Agreement shall be binding upon the executors, administrators, heirs, successors and assigns of the
Recipient. Except as otherwise permitted pursuant to the first sentence of this Section, any
attempt to effect a Transfer of any shares of Restricted Stock prior to the date on which the
shares become Vested Shares shall be void ab initio. For purposes of this Agreement, “Transfer”
shall mean any sale, transfer, encumbrance, gift, donation, assignment, pledge, hypothecation, or
other disposition, whether similar or dissimilar to those previously enumerated, whether voluntary
or involuntary, and including, but not limited to, any disposition by operation of law, by court
order, by judicial process, or by foreclosure, levy or attachment.
7. Tax Matters; Section 83(b) Election.
(a) If the Recipient properly elects, within thirty (30) days of the Date of Grant, to include in
gross income for federal income tax purposes an amount equal to the fair market value (as of the
Date of Grant) of the Restricted Stock pursuant to Section 83(b) of the Internal Revenue Code of
1986, as amended (the “Code”), the Recipient shall make arrangements satisfactory to the Company to
pay to the Company any federal, state or local income taxes required to be withheld with respect to
the Restricted Stock. If the Recipient shall fail to make such tax payments as are required, the
Company shall, to the extent permitted by law, have the right to deduct from any payment of any
kind (including without limitation, the withholding of
any Shares that otherwise would be issued to the Recipient under this Agreement) otherwise due
to the Recipient any federal, state or local taxes of any kind required by law to be withheld with
respect to the Restricted Stock.
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(b) If the Recipient does not properly make the election described in paragraph 7(a) above, the
Recipient shall, no later than the date or dates as of which the restrictions referred to in this
Agreement hereof shall lapse, pay to the Company, or make arrangements satisfactory to the
Committee for payment of, any federal, state or local taxes of any kind required by law to be
withheld with respect to the Restricted Stock (including without limitation the vesting thereof),
and the Company shall, to the extent permitted by law, have the right to deduct from any payment of
any kind (including without limitation, the withholding of any Shares that otherwise would be
distributed to the Recipient under this Agreement) otherwise due to Recipient any federal, state,
or local taxes of any kind required by law to be withheld with respect to the Restricted Stock.
(c) The Recipient may satisfy the withholding requirements with respect to the Restricted
Stock pursuant to any one or combination of the following methods:
(i) payment in cash; or
(ii) if and to the extent permitted by the Committee, payment by surrendering Shares which
have a value equal to the required withholding amount or the withholding of Shares that otherwise
would be deliverable to the Recipient pursuant to this Award. The Recipient may surrender Shares
either by attestation or by delivery of a certificate or certificates for shares duly endorsed for
transfer to the Company, and if required with medallion level signature guarantee by a member firm
of a national stock exchange, by a national or state bank (or guaranteed or notarized in such other
manner as the Committee may require).
(d) Tax consequences on the Recipient (including without limitation federal, state, local and
foreign income tax consequences) with respect to the Restricted Stock (including without limitation
the grant, vesting and/or forfeiture thereof) are the sole responsibility of the Recipient. The
Recipient shall consult with his or her own personal accountant(s) and/or tax advisor(s) regarding
these matters, the making of a Section 83(b) election, and the Recipient’s filing, withholding and
payment (or tax liability) obligations.
8. Amendment, Modification & Assignment; Non-Transferability. This Agreement may only be modified or
amended in a writing signed by the parties hereto. No promises, assurances, commitments,
agreements, undertakings or representations, whether oral, written, electronic or otherwise, and
whether express or implied, with respect to the subject matter hereof, have been made by either
party which are not set forth expressly in this Agreement. Unless otherwise consented to in
writing by the Company, in its sole discretion, this Agreement (and Recipient’s rights hereunder)
may not be assigned, and the obligations of Recipient hereunder may not be delegated, in whole or
in part. The rights and obligations created hereunder shall be binding on the Recipient and his
heirs and legal representatives and on the successors and assigns of the Company.
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9. Complete Agreement. This Agreement (together with those agreements and documents expressly
referred to herein, for the purposes referred to herein) embody the complete and entire agreement
and understanding between the parties with respect to the subject matter hereof, and supersede any
and all prior promises, assurances, commitments, agreements, undertakings or representations,
whether oral, written, electronic or otherwise, and whether express or implied, which may relate to
the subject matter hereof in any way.
10. Miscellaneous.
(a) No Right to (Continued) Employment or Service. This Agreement and the grant of Restricted
Stock hereunder shall not confer, or be construed to confer, upon the Recipient any right to
employment or service, or continued employment or service, with the Company or any Related Entity.
(b) No Limit on Other Compensation Arrangements. Nothing contained in this Agreement shall
preclude the Company or any Related Entity from adopting or continuing in effect other or
additional compensation plans, agreements or arrangements, and any such plans, agreements and
arrangements may be either generally applicable or applicable only in specific cases or to specific
persons.
(c) Severability. If any term or provision of this Agreement is or becomes or is deemed to be
invalid, illegal or unenforceable in any jurisdiction or under any applicable law, rule or
regulation, then such provision shall be construed or deemed amended to conform to applicable law
(or if such provision cannot be so construed or deemed amended without materially altering the
purpose or intent of this Agreement and the grant of Restricted Stock hereunder, such provision
shall be stricken as to such jurisdiction and the remainder of this Agreement and the award
hereunder shall remain in full force and effect).
(d) No Trust or Fund Created. Neither this Agreement nor the grant of Restricted Stock hereunder
shall create or be construed to create a trust or separate fund of any kind or a fiduciary
relationship between the Company or any Related Entity and the Recipient or any other person. To
the extent that the Recipient or any other person acquires a right to receive payments from the
Company or any Related Entity pursuant to this Agreement, such right shall be no greater than the
right of any unsecured general creditor of the Company.
(e) Law Governing. This Agreement shall be governed by and construed and enforced in accordance
with the internal laws of the State of Florida (without reference to the conflict of laws rules or
principles thereof).(h)
(m) Interpretation. The Recipient accepts the Restricted Stock subject to all of the terms,
provisions and restrictions of this Agreement and the Plan. The undersigned Recipient hereby
accepts as binding, conclusive and final all decisions or interpretations of the Board or the
Committee upon any questions arising under this Agreement or the Plan.
(n) Headings. Section, paragraph and other headings and captions are provided solely as a
convenience to facilitate reference. Such headings and captions shall not be deemed
in any way material or relevant to the construction, meaning or interpretation of this
Agreement or any term or provision hereof.
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(o) Notices. Any notice under this Agreement shall be in writing and shall be deemed to have been
duly given when delivered personally or when deposited in the United States mail, registered,
postage prepaid, and addressed, in the case of the Company, to the Company’s President at 0 X.
Xxxxxxxx Xxxx., Xxxxx 0000, Xxxxx, Xxxxxxx 00000, or if the Company should move its principal
office, to such principal office, and, in the case of the Recipient, to the Recipient’s last
permanent address as shown on the Company’s records, subject to the right of either party to
designate some other address at any time hereafter in a notice satisfying the requirements of this
Section.
(p) Non-Waiver of Breach. The waiver by any party hereto of the other party’s prompt and complete
performance, or breach or violation, of any term or provision of this Agreement shall be effected
solely in a writing signed by such party, and shall not operate nor be construed as a waiver of any
subsequent breach or violation, and the waiver by any party hereto to exercise any right or remedy
which he or it may possess shall not operate nor be construed as the waiver of such right or remedy
by such party, or as a bar to the exercise of such right or remedy by such party, upon the
occurrence of any subsequent breach or violation.
(q) Counterparts. This Agreement may be executed in two or more separate counterparts, each of
which shall be an original, and all of which together shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties hereto, intending to be legally bound, have executed this Agreement
as of the date first written above.
| TERREMARK WORLDWIDE, INC. |
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| By: | ||||
| Name: | ||||
| Title: | ||||
| AGREED AND ACCEPTED: |
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| By: | ||||
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