DIRECTOR PHANTOM STOCK AWARD AGREEMENT Community Health Systems, Inc.
Exhibit 10.19
DIRECTOR PHANTOM STOCK AWARD AGREEMENT
Community Health Systems, Inc.
THIS AGREEMENT between the Grantee and Community Health Systems, Inc., a Delaware corporation
(the “Company”), governs an Award of Phantom Stock in the amount and on the date specified
in the Grantee’s award notification (the “Grant Date”);
WHEREAS, the Company has adopted the Community Health Systems, Inc. Amended and Restated 2000
Stock Option and Award Plan (the “Plan”) in order to provide additional incentive to
certain employees and directors of the Company and its Subsidiaries;
WHEREAS, Section 10.2 of the Plan provides for grants of shares of Phantom Stock to Eligible
Individuals; and
WHEREAS, the Compensation Committee of the Board of Directors has approved this form of
Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
1. Grant of Phantom Stock.
The Company hereby grants to the Grantee an award of Phantom Stock (the
“Award”) in respect of the number of Shares set out in an electronic notification by
the Company’s stock option plan administrator (the “Plan Administrator”).
This Agreement shall be construed in accordance and consistent with, and subject to,
the provisions of the Plan (the provisions of which are hereby incorporated by reference)
and, except as otherwise expressly set forth herein, the capitalized terms used in this
Agreement shall have the same definitions as set forth in the Plan.
2. Vesting Generally.
Except as provided in Sections 3 and 4 hereof, the Award shall vest in respect of one-third
(1/3) of the Shares subject to the Award (rounded up to the next whole Share, if necessary), on
each of the first three (3) anniversaries of the Date of Grant.
3. Effect of Certain Terminations of Service.
If the Grantee’s service as a member of the Board of Directors terminates as a result of his
or her death, Disability, or for any reason other than for Cause, in each case if such termination
occurs on or after the Date of Grant, the Award shall become vested in respect of all Shares as to
which it had not previously become vested pursuant to Section 2 or 4 hereof as of the date of such
termination.
4. Effect of Change in Control.
In the event that a Change in Control which also constitutes a change in control or effective
control of the Company or a change in the ownership of a substantial portion of its assets, in each
case within the meaning of Section 409A of the Code and the regulations and interpretive guidance
issued thereunder (a “Section 409A Change in Control”) occurs at any time on or after the
Date of Grant and prior to the Grantee’s termination of service as a member of the Board of
Directors, the Award shall become vested in respect of all Shares as to which it had not previously
become vested pursuant to Section 2 hereof as of the date of such Section 409A Change in Control.
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5. Delivery of Shares.
Except as otherwise provided in this Section 5, a stock certificate (or other electronic
indicia of ownership) with respect to Shares as to which the Award has become vested pursuant to
Section 2, 3 or 4 hereof shall be delivered to the Grantee as soon as practicable following the
date on which the Award or portion thereof has become vested.
Upon the Grantee’s death, a stock certificate (or other electronic indicia of ownership) for
the Shares with respect to which the Award or portion thereof has become vested by reason of the
Grantee’s death pursuant to Section 3 hereof, shall be delivered to the executors or administrators
of the Grantee’s estate as soon as practicable following the Company’s or the Company’s Plan
Administrator’s receipt of notification of the Grantee’s death. All references herein to “the
Grantee” shall also include the Grantee’s executors, administrators, heirs or assigns in the event
of the Grantee’s death.
6. Forfeiture of Phantom Stock.
In addition to the circumstance described in Section 7(a) hereof, the Award (and any and all
Shares in respect thereof), to the extent it has not become vested in accordance with Section 2, 3
or 4 hereof, shall be forfeited upon the termination of the Grantee’s service as a member of the
Board of Directors for any reason other than those set forth in Section 3 hereof prior to such
vesting.
7. Acknowledgement and Acceptance of Award Agreement.
The Award shall be subject to the Grantee’s acknowledgement and acceptance of this Agreement
to the Company or its Plan Administrator (including by electronic means, if so provided) no later
than the earlier of (i) 180 days from the Date of Grant and (ii) the date that is immediately prior
to the date that the Award vests pursuant to Section 3 or 4 hereof (the “Return Date”);
provided that if the Grantee dies before the Return Date, this requirement shall be deemed to be
satisfied if the executor or administrator of the Grantee’s estate acknowledges and accepts this
Agreement through the Company or its Plan Administrator no later than ninety (90) days following
the Grantee’s death (the “Executor Return Date”). If this Agreement is not so acknowledged
and accepted on or prior to the Return Date or the Executor Return Date, as applicable, the Award
(and any and all Shares in respect thereof) shall be forfeited, and neither the Grantee nor the
Grantee’s heirs, executors, administrators and successors shall have any rights with respect
thereto.
8. No Right to Continued Service.
Nothing in this Agreement or the Plan shall interfere with or limit in any way the right of
the Company to terminate the Grantee’s service on its Board of Directors, nor confer upon the
Grantee any right to continuance of such service as a Board member.
9. Withholding of Taxes.
Prior to the delivery of a stock certificate or evidence of book entry Shares with respect to
the Award, the Grantee shall pay to the Company or the Company’s Plan Administrator, the federal,
state and local income taxes and other amounts as may be required by law to be withheld (the
“Withholding Taxes”) with respect to such Shares, if any. By acknowledging and accepting
this Agreement in the manner provided in Section 7 hereof, the Grantee shall be deemed to elect to
have the Company or the Company’s Plan Administrator, withhold a portion of such Shares having an
aggregate Fair Market Value equal to the Withholding Taxes in satisfaction thereof, such election
to continue in effect until the Grantee notifies the Company or its Plan Administrator before such
delivery that the Grantee shall satisfy such
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obligation in cash, in which event the Company shall not withhold a portion of such Shares as
otherwise provided in this Section 9.
10. The Grantee is Bound by the Plan.
By acknowledging and accepting the Award, the Grantee hereby confirms the availability and his
or her review of a copy of the Plan, the Prospectus, and other documents provided to the Grantee in
connection with the Award, by the Company or its Plan Administrator, and the Grantee agrees to be
bound by all the terms and provisions thereof.
11. Modification of Agreement.
This Agreement may be modified, amended, suspended or terminated, and any terms or conditions
may be waived, but only by a written instrument executed by both parties hereto.
12. Severability.
Should any provision of this Agreement be held by a court of competent jurisdiction to be
unenforceable or invalid for any reason, the remaining provisions of this Agreement shall not be
affected by such holding and shall continue in full force in accordance with their terms.
13. Governing Law.
The validity, interpretation, construction and performance of this Agreement shall be governed
by the laws of the State of Tennessee without giving effect to the conflicts of laws principles
thereof.
14. Successors in Interest.
This Agreement shall inure to the benefit of and be binding upon any successor to the Company.
This Agreement shall inure to the benefit of the Grantee’s legal representatives. All obligations
imposed upon the Grantee and all rights granted to the Company under this Agreement shall be
binding upon the Grantee’s heirs, executors, administrators and successors.
15. Resolution of Disputes.
Any dispute or disagreement which may arise under, or as a result of, or in any way relate to,
the interpretation, construction or application of this Agreement shall first be referred to the
Chief Executive Officer for informal resolution, and if necessary, referred to the Committee for
its determination. Any determination made hereunder shall be final, binding and conclusive on the
Grantee, his or her heirs, executors, administrators and successors, and the Company and its
Subsidiaries for all purposes.
16. Entire Agreement.
This Agreement and the terms and conditions of the Plan constitute the entire understanding
between the Grantee and the Company and its Subsidiaries, and supersede all other agreements,
whether written or oral, with respect to the Award.
17. Headings.
The headings of this Agreement are inserted for convenience only and do not constitute a part
of this Agreement.
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18. Deemed Execution.
On the date of the Grantee’s electronic acceptance of the terms of the Award, and this
Agreement, this Agreement shall be deemed to have been executed and delivered by the Grantee and
the Company.
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