PACIFIC ETHANOL, INC. RESTRICTED STOCK AGREEMENT
Exhibit
10.2
THIS
RESTRICTED STOCK AGREEMENT (this “Agreement”), dated and effective as of
__________ (the “Grant Date”) by and between Pacific Ethanol, Inc., a Delaware
corporation (the “Company”), and __________ (“Employee”), is entered into as
follows:
WHEREAS,
the Company has established the Pacific Ethanol, Inc. 2006 Stock Incentive
Plan
(the “Plan”), a copy of which has previously been provided to Employee or is
provided with this Agreement; and
WHEREAS,
the Compensation Committee of the Board of Directors of the Company (the
“Committee”) has determined that Employee be granted shares of the Company’s
$.001 par value per share Common Stock (the “Restricted Stock”) subject to the
restrictions stated below.
Capitalized
terms used but not otherwise defined herein shall have the respective meanings
ascribed to them in the Plan. References herein to the Company shall also
include, where and as applicable, any Parent or Subsidiary of the Company in
the
same manner used in the Plan.
NOW,
THEREFORE, the parties hereby agree as follows:
1. Grant
of Restricted Stock.
Subject
to the terms and conditions of this Agreement and of the Plan, the Company
hereby grants to Employee ***__________***
shares
of Restricted Stock. As soon as practicable, the Company shall cause the shares
of Restricted Stock to be issued in Employee’s name. During the Restriction
Period, the Restricted Stock shall be held in the custody of the Company or
its
designee for Employee’s account. The Restricted Stock shall be subject to, and
shall bear appropriate legends with respect to, the restrictions described
herein.
2. Vesting
Schedule.
(a) The
interest of Employee in the Restricted Stock shall vest as to ***__________***
shares
of Restricted Stock immediately on the Grant Date and, provided Employee remains
continuously employed by the Company on a full time basis from the Grant Date
through each subsequent vesting date, as to an additional ***__________***
shares
of such Restricted Stock on the first (1st)
anniversary of the Grant Date and on each succeeding anniversary date, so as
to
be fully vested on the _____ (___) anniversary of the Grant Date. If a vesting
date falls on a weekend or any other day on which the NASDAQ Stock Market
(“NASDAQ”) is not open, vesting of the corresponding Restricted Stock shall
occur on the next following NASDAQ trading day. Notwithstanding the foregoing,
the interest of Employee in the Restricted Stock may vest as to one hundred
percent (100%) of the then unvested Restricted Stock upon a Change in Control
but only in accordance with the Plan.
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(b) Upon
termination of the Restriction Period, the Company shall, as soon as practicable
thereafter, deliver to Employee a certificate representing the Restricted Stock
with respect to which such restrictions have lapsed. Employee may instruct
the
Company in writing to deliver vested shares of Restricted Stock to Employee’s
broker or other designee; provided, that (x) as to the Restricted Stock that
vests immediately on the Grant Date, Employee shall communicate such instruction
in writing to the Chief Financial Officer of the Company within two (2) business
days following the Grant Date, and (y) as to the Restricted Stock that may
vest
following the Grant Date, Employee shall communicate such instruction in writing
to the Chief Financial Officer of the Company as to each subsequent vesting
amount not more than thirty (30) business days and not less than five (5)
business days prior to each subsequent vesting date. If Employee does not timely
provide such instructions, the vested shares of Restricted Stock will be
delivered to Employee personally or to Employee’s home or other address as set
forth in the Company’s books and records.
3. Restrictions.
(a) No
portion of the Restricted Stock or rights granted hereunder may be sold,
transferred, assigned, pledged or otherwise encumbered or disposed of by
Employee until such portion of the Restricted Stock becomes vested in accordance
with Section 2
of this
Agreement. The period of time between the date hereof and the date Restricted
Stock becomes vested is referred to herein as the “Restriction Period.”
In
addition, none of the Restricted Stock, even if vested, may be sold or
transferred in contravention of (i) any market blackout periods the Company
may
impose from time to time, or (ii) the Company’s xxxxxxx xxxxxxx policies to the
extent applicable to Employee from time to time.
(b) The
vesting schedule requires Employee’s continued service as a full-time employee
of the Company during the applicable vesting periods as a condition to the
vesting of the Restricted Stock and the rights and benefits under this
Agreement. If Employee’s employment with the Company is terminated for any
reason, whether voluntarily or involuntarily, the balance of the Restricted
Stock subject to the provisions of this Agreement which has not vested at the
time of Employee’s termination of employment shall be forfeited by Employee
without payment of any consideration by the Company and neither Employee nor
any
successor, heir, assign or personal representative of Employee shall have any
right, title or interest in or to the forfeited Restricted Stock or the
certificates evidencing them, and the Company shall direct its transfer agent
of
the Common Stock to make the appropriate entries in its records showing the
cancellation of the certificate or certificates for such Restricted Stock.
Service as an employee for only a portion of a vesting period, even if a
substantial portion, will not entitle Employee to any proportionate vesting
of
the Restricted Stock allocated to that period or avoid or mitigate the
forfeiture of and vesting in Employee’s Restricted Stock that will occur upon
the cessation of Employee’s service as an employee of the Company.
4. Shareholder
Rights.
During
the Restriction Period, Employee shall have all the rights of a shareholder
with
respect to the Restricted Stock except for the right to transfer the Restricted
Stock, as set forth in Section 3
of this
Agreement. Accordingly, Employee shall have the right to vote the Restricted
Stock and to receive any cash dividends paid to or made with respect to the
Restricted Stock; provided, however, that dividends paid, if any, with respect
to that Restricted Stock which has not vested at the time of the dividend
payment shall be held in the custody of the Company and shall be subject to
the
same restrictions that apply to the corresponding Restricted Stock.
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5. Changes
in Common Stock.
If any
change is made to the Common Stock by reason of any stock split, stock dividend,
recapitalization, combination of shares, exchange of shares or other change
affecting the outstanding Common Stock as a class without the Company’s receipt
of consideration, appropriate adjustments shall be made by the Plan
Administrator to (i) the maximum number and/or class of securities issuable
under the Plan, (ii) the maximum number and/or class of securities for
which any one person may be granted Awards under the Plan per calendar year,
(iii) the number and/or class of securities and the exercise or base price
per
share (or any other cash consideration payable per share) in effect under each
outstanding Award under the Discretionary Grant Program, and (iv) the number
and/or class of securities subject to each outstanding Award under the Stock
Issuance Program and the cash consideration (if any) payable per share
thereunder. To the extent such adjustments are to be made to outstanding Awards,
those adjustments shall be effected in a manner that shall preclude the
enlargement or dilution of rights and benefits under those Awards. The
adjustments determined by the Plan Administrator shall be final, binding and
conclusive.
6. Taxes.
(a) Employee
will recognize ordinary income for federal income tax purposes on each date
the
Restricted Stock subject to Employee award vests, whether pursuant to the normal
vesting schedule above or the acceleration provisions of this Agreement that
may
apply. The amount of Employee’s taxable income on each such vesting date will be
equal to the fair market value per share of Common Stock on the date of vesting
times the number of shares of Restricted Stock which vest on that
date.
(b) Employee
shall be liable for any and all taxes, including withholding taxes, arising
out
of this grant or the vesting of Restricted Stock hereunder. Employee may elect
to satisfy such withholding tax obligation by (i) having the Company retain
Restricted Stock having a fair market value equal to the Company’s minimum
withholding obligation, or (ii) making a cash payment to the Company in an
amount equal to the Company’s minimum withholding obligation; provided, that (x)
as to the Restricted Stock that vests immediately on the Grant Date, Employee
shall make and communicate such election in writing in the attached Notice
of
Election to the Chief Financial Officer of the Company within two (2) business
days following the Grant Date, and (y) as to the Restricted Stock that may
vest
following the Grant Date, Employee shall make and communicate such election
in
writing in the attached Notice of Election to the Chief Financial Officer of
the
Company as to each subsequent vesting amount not more than thirty (30) business
days and not less than five (5) business days prior to each subsequent vesting
date. If Employee elects to pay the applicable minimum withholding amount in
cash, then Employee shall make such payment within two (2) business days
following the Grant Date or the applicable subsequent vesting date. If Employee
(A) fails to make and communicate such election in writing in the attached
Notice of Election to the Chief Financial Officer of the Company within the
applicable time period, or (B) elects to make a cash payment of the minimum
withholding amount and Employee fails to make such payment within two (2)
business days following the Grant Date or the applicable subsequent vesting
date, then the Company’s minimum withholding tax obligations shall be satisfied
by the Company withholding a number of shares of Restricted Stock that would
otherwise vest and be delivered to Employee under this Agreement that the
Company determines has a fair market value sufficient to meet such obligations.
The Company shall not be required to deliver any Restricted Stock or to
recognize any purported transfer of shares of the Restricted Stock until such
withholding obligations are satisfied. Employee is ultimately liable and
responsible for all taxes owed by Employee in connection with Employee’s
Restricted Stock, regardless of any action the Company takes with respect to
any
tax withholding obligations that arise in connection with the Restricted Stock.
The Company makes no representation or undertaking regarding the treatment
of
any tax withholding in connection with the grant, issuance, vesting or
settlement of the Restricted Stock or the subsequent sale of any of the shares
of Restricted Stock. The Company does not commit and is under no obligation
to
structure the Restricted Stock award or program to reduce or eliminate
Employee’s tax liability. The Company shall not be required to issue or deliver
to Employee fractional shares of Restricted Stock upon withholding of any shares
of Restricted Stock to cover the minimum withholding tax, or otherwise, and
any
fractional share amounts shall be paid to Employee by the Company solely in
cash
based on the pro rata fair market value of such fractional share amounts on
the
date of vesting.
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7. Securities
Law Compliance.
The
Company will use its reasonable commercial efforts to assure that all Restricted
Stock issued pursuant to this Agreement is registered under the federal
securities laws. However, no Restricted Stock will be issued pursuant to
Employee’s award if such issuance would otherwise constitute a violation of any
applicable federal or state securities laws or regulations or the requirements
of The NASDAQ Global Market and any stock exchange or other market on which
the
Common Stock is then quoted or listed for trading. The inability of the Company
to obtain approval from any regulatory body having authority deemed by the
Company to be necessary to the lawful issuance of any Restricted Stock hereunder
shall defer the Company’s obligation with respect to the issuance of such
Restricted Stock until such approval has been obtained.
8. Miscellaneous.
(a) The
grant
of Restricted Stock or another award to an Employee in any one year, or at
any
time, does not obligate the Company to make a grant in any future year or in
any
given amount and should not create an expectation that the Company might make
a
grant in any future year or in any given amount.
(b) The
Company shall not be required (i) to transfer on its books any shares of
Restricted Stock which shall have been sold or transferred in violation of
any
of the provisions set forth in this Agreement, or (ii) to treat as owner of
such
shares or to accord the right to vote as such owner or to pay dividends to
any
transferee to whom such shares shall have been so transferred.
(c) The
parties agree to execute such further instruments and to take such action as
may
reasonably be necessary to carry out the intent of this Agreement.
(d) Any
notice required or permitted hereunder shall be given in writing and shall
be
deemed effectively given upon delivery to Employee at Employee’s address then on
file with the Company.
(e) This
Agreement shall not be construed so as to grant Employee any right to remain
in
the employ of the Company.
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(f) The
parties agree that neither the Company nor any of its affiliates shall have
any
further obligation to Employee relating to the grant of stock or other incentive
compensation except as stated herein.
(g) This
Agreement and the Plan constitute the entire agreement of the parties with
respect to the subject matter hereof. This Agreement may not be amended except
with the consent of the Committee and by a written instrument duly executed
by
the Company and Employee.
(h) This
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their heirs, personal representatives, successors and assigns. The
terms of this Agreement shall in all respects be subject to the terms of the
Plan. Employee hereby agrees to accept as binding, conclusive and final all
decisions and interpretations of the Committee upon any questions arising under
the Plan or this Agreement.
(i) The
interpretation, performance and enforcement of this Agreement shall be governed
by the laws of the State of Delaware without resort to that State’s
conflicts-of-laws rules.
(j) This
Agreement shall not in any way affect the right of the Company to adjust,
reclassify, reorganize or otherwise make changes in its capital or business
structure or to merge, consolidate, dissolve, liquidate or sell or transfer
all
or any part of its business or assets.
9. Mandatory
Arbitration.
ANY AND
ALL DISPUTES OR CONTROVERSIES BETWEEN EMPLOYEE AND THE COMPANY OR BETWEEN THE
COMPANY AND EMPLOYEE ARISING OUT OF, RELATING TO OR OTHERWISE CONNECTED WITH
THIS AGREEMENT OR THE AWARD OF RESTRICTED STOCK EVIDENCED HEREBY OR THE
VALIDITY, CONSTRUCTION, PERFORMANCE OR TERMINATION OF THIS AGREEMENT SHALL
BE
SETTLED EXCLUSIVELY BY BINDING ARBITRATION TO BE HELD IN FRESNO COUNTY,
CALIFORNIA. THE ARBITRATION PROCEEDINGS SHALL BE GOVERNED BY (I) THE NATIONAL
RULES FOR THE RESOLUTION OF EMPLOYMENT DISPUTES THEN IN EFFECT OF THE AMERICAN
ARBITRATION ASSOCIATION, AND (II) THE FEDERAL ARBITRATION ACT. THE ARBITRATOR
SHALL HAVE THE SAME, BUT NO GREATER, REMEDIAL AUTHORITY AS WOULD A COURT HEARING
THE SAME DISPUTE. THE DECISION OF THE ARBITRATOR SHALL BE FINAL, CONCLUSIVE
AND
BINDING ON THE PARTIES TO THE ARBITRATION AND SHALL BE IN LIEU OF THE RIGHTS
THOSE PARTIES MAY OTHERWISE HAVE TO A JURY TRIAL; PROVIDED, HOWEVER, THAT SUCH
DECISION SHALL BE SUBJECT TO CORRECTION, CONFIRMATION OR VACATION IN ACCORDANCE
WITH THE PROVISIONS AND STANDARDS OF APPLICABLE LAW GOVERNING THE JUDICIAL
REVIEW OF ARBITRATION AWARDS. THE
ARBITRATOR SHALL ISSUE A WRITTEN DECISION THAT REVEALS THE ESSENTIAL FINDINGS
AND CONCLUSIONS ON WHICH THE DECISION IS BASED, AND THE ARBITRATOR’S DECISION
SHALL BE SUBJECT TO SUCH JUDICIAL REVIEW AS IS PROVIDED BY LAW. THE COMPANY
SHALL PAY ANY ARBITRATION FILING FEE, AND WILL BEAR ALL OTHER COSTS OF
ARBITRATION, INCLUDING FEES FOR THE SERVICES OF THE ARBITRATOR AND ANY COURT
REPORTER ORDERED BY THE ARBITRATOR. EACH PARTY SHALL BEAR ITS, HIS OR HER OWN
COSTS OF LEGAL REPRESENTATION; PROVIDED, HOWEVER, IF ANY PARTY PREVAILS ON
A
CLAIM ENTITLING THE PREVAILING PARTY TO ATTORNEYS’ FEES AND/OR COSTS PURSUANT TO
ANY APPLICABLE EMPLOYMENT OR CIVIL RIGHTS STATUTE, THE ARBITRATOR MAY AWARD
REASONABLE FEES AND/OR COSTS TO THE PREVAILING PARTY IN ACCORDANCE WITH SUCH
CLAIM. JUDGMENT
SHALL BE ENTERED ON THE ARBITRATOR’S DECISION IN ANY COURT HAVING JURISDICTION
OVER THE SUBJECT MATTER OF SUCH DISPUTE OR CONTROVERSY. NOTWITHSTANDING THE
FOREGOING, EITHER PARTY MAY IN AN APPROPRIATE MATTER APPLY TO A COURT PURSUANT
TO CALIFORNIA CODE OF CIVIL PROCEDURE SECTION 1281.8, OR ANY COMPARABLE
STATUTORY PROVISION OR COMMON LAW PRINCIPLE, FOR PROVISIONAL RELIEF, INCLUDING
A
TEMPORARY RESTRAINING ORDER OR A PRELIMINARY INJUNCTION. TO THE EXTENT PERMITTED
BY LAW, THE PROCEEDINGS AND RESULTS, INCLUDING THE ARBITRATOR’S DECISION, SHALL
BE KEPT CONFIDENTIAL TO THE EXTENT PERMITTED BY APPLICABLE LAW.
10. Remaining
Terms.
The
remaining terms and conditions of Employee’s award are governed by the Plan, and
Employee’s award is also subject to all interpretations, amendments, rules,
regulations and decisions that may from time to time be adopted under the Plan.
The General Plan Description, which is the official prospectus summarizing
the
principal features of the Plan, has previously been provided to Grantee or
is
provided with this Agreement.
(Signature
page follows.)
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IN
WITNESS WHEREOF, the undersigned have executed this Agreement effective on
the
date first set above.
|
COMPANY:
|
a
Delaware corporation
By:
|
I,
the
undersigned Employee, hereby acknowledge receiving, reading and understanding
the General Plan Description, which is the official prospectus summarizing
the
principal features of the Plan, this Agreement and the Plan itself. I further
acknowledge and accept the foregoing terms and conditions of the Restricted
Stock award evidenced hereby. I also acknowledge and agree that the foregoing
sets forth the entire understanding between the Company and me regarding my
entitlement to receive the shares of the Company’s Common Stock subject to such
award and supersedes all prior oral and written agreements on that
subject.
|
EMPLOYEE:
|
Print:
|
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NOTICE
OF
ELECTION
Chief
Financial Officer
Re: Notice
of Election As to Manner of Payment of Minimum Withholding Tax
| 1. |
The
undersigned Employee has been granted shares of Restricted Stock
of
Pacific Ethanol, Inc., a Delaware corporation (the
“Company”).
|
| 2. |
The
undersigned Employee hereby elects to (check
one):
|
_____
pay
the minimum withholding tax in cash with respect to shares of Restricted Stock;
or
_____
have shares of Restricted Stock withheld by the Company to cover the minimum
withholding tax.
| 3. |
The
foregoing election is with respect to the following Grant Date or
vesting
date (check one):
|
_____
October 4, 2006 (Grant Date)
_____
October 4, 2007
_____
October 4, 2008
_____
October 4, 2009
_____
October 4, 2010
_____
October 4, 2011
| 4. |
If
the undersigned Employee has elected to pay to the Company the minimum
withholding tax in cash with respect to shares of Restricted Stock,
the
undersigned Employee shall make such payment to the Company within
two (2)
business days following the Grant Date or the subsequent vesting
date (as
applicable). If the undersigned Employee fails to make payment within
such
period, then the Company’s minimum withholding tax obligations shall be
satisfied by the Company withholding a number of shares of Restricted
Stock that would otherwise vest and be delivered to Employee that
the
Company determines has a fair market value sufficient to meet such
obligations.
|
| 5. |
The
terms and conditions of Company’s grant of Restricted Stock are governed
solely by the Restricted Stock Agreement and the
Plan.
|
|
Dated:_________________________
|
EMPLOYEE
|
| ___________________________________ | |
|
Print:_____________________________________
|
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