CTS CORPORATION RESTRICTED STOCK UNIT AGREEMENT
Exhibit 10(c)
THIS AGREEMENT is made as of the 8th day of June, 2005 (the “Grant Date”) between
CTS CORPORATION, an Indiana corporation (the “Company”), and Xxxxxx X. Xxxxxxx (the “Grantee”).
1. Grant. Subject to the terms set forth in this Agreement and in the Company’s 2004
Omnibus Long-Term Incentive Plan (the “Plan”), the Company hereby grants to the Grantee 45,000
Restricted Stock Units (the “Award”). Except as expressly provided herein, capitalized terms used
herein shall have the meaning ascribed to such terms under the Plan.
It is intended that this Agreement and its administration comply with the provisions of
Section 409A of the Code. Accordingly, notwithstanding any provision in this Agreement or in the
Plan to the contrary, this Agreement and the Plan will be interpreted, applied and, to the minimum
extent necessary to comply with Section 409A of the Code, amended, so that the Agreement does not
fail to meet, and is operated in accordance with, the requirements of paragraphs (2), (3) and (4)
of Section 409A(a) of the Code. As used herein, “Code” means the Internal Revenue Code of 1986 as
amended from time to time, and any interpretations thereof issued by the U.S. Treasury Department
on which the Company is permitted to rely.
2. Vesting and Settlement of Restricted Stock Units. The Award shall vest and become
non-forfeitable in installments as follows:
(i) On June 8, 2006, an amount equal to twenty percent (20%) multiplied by the initial number of
Restricted Stock Units specified in Section 1 of this Agreement;
(ii) On June 8, 2007, an amount equal to twenty percent (20%) multiplied by the initial number of
Restricted Stock Units specified in Section 1 of this Agreement;
(iii) On December 30, 2007, an amount equal to sixty percent (60%) multiplied by the initial number
of Restricted Stock Units specified in Section 1 of this Agreement
(each such date, a “Vesting Date”), provided that the Grantee remains in the continuous employ
of the Company and is an employee of the Company on the Vesting Date.
Restricted Stock Units shall be settled on the basis of one Share for each vested Restricted
Stock Unit. On the following dates, or as soon thereafter as is reasonably practicable, the
Company shall distribute to the Grantee Shares equal to twenty percent (20%) multiplied by the
number of initial Restricted Stock Units specified in Section 1
above; June 8, 2006, June 8, 2007, June 8, 2008, June 8, 2009 and June 8, 2010 (each such date
of distribution, a “Settlement Date”). The Company’s obligations to the Grantee with respect to the
Restricted Stock Units will be satisfied in full upon the distribution of Shares corresponding to
such Restricted Stock Units. On the Settlement Date(s), the Company may, at its election, either
(i) credit the number of Shares to be distributed to the Grantee as of that Settlement Date to a
book-entry account in the name of the Grantee held by the Company’s transfer agent; or (ii) credit
the number of Shares to be distributed to the Grantee as of that Settlement Date to a brokerage
account designated by the Grantee. In no event may any Settlement Date be accelerated except in
accordance with Section 409A of the Code.
Notwithstanding anything to the contrary in this Agreement, upon the first to occur of the
following events, all Restricted Stock Units granted hereunder shall vest and become nonforfeitable
and Shares shall be distributed to the Grantee, estate, guardian or beneficiary of the Grantee as
the case may be, in the settlement of Restricted Stock Units as soon as reasonably practicable, and
such date(s) of distribution shall be deemed to be the Settlement Date(s):
(a) Grantee’s becoming disabled, as defined by Section 409A of the Code;
(b) Grantee’s death;
(c) To the extent permitted by Section 409A of the Code, a change in ownership or effective
control of the Company; or in the ownership of a substantial portion of the assets of the Company;
or
(d) Grantee’s unforeseeable emergency, as defined and not in excess of the amount permitted by
Section 409A of the Code.
Unless the Committee determines otherwise in its sole discretion, if the Grantee’s employment
with the Company terminates for any reason not specified above, all Restricted Stock Units granted
hereunder which have not vested as of the date of such termination of employment shall be
permanently forfeited on such termination date.
4. Tax Withholding. The Company shall have the right to deduct from any compensation
due the Grantee from the Company any federal, state, local or foreign taxes required by law to be
withheld in connection with the issuance of Shares or vesting of any Restricted Stock Unit pursuant
to this Agreement. To the extent that the amounts payable to the Grantee are insufficient for such
withholding, it shall be a condition to the issuance of Shares or vesting of the Restricted Stock
Units, as the case may be, that the Grantee shall pay such taxes or make provisions that are
satisfactory to the Company for the payment thereof.
The Grantee may, at his or her election, pay such withholding taxes in cash or, with respect
to withholding amounts due in connection with a Settlement Date, by having the Company retain
Shares otherwise deliverable on the Settlement Date in an
amount sufficient to satisfy the amount of tax required to be withheld. The determination of
the number of Shares retained for this purpose shall be based on the Fair Market Value of the
Shares on the Settlement Date. In the event that the retention of Shares to satisfy withholding
taxes would otherwise result in the delivery of a fractional Share, the Company will round down to
the next whole Share and apply the value of the fractional Share to the recipient’s tax obligations
or, in the alternative, the Company may make such other arrangements to avoid the issuance of a
fractional Share as may be permitted by law. No Shares shall be transferred to the Grantee
hereunder until such time as all applicable withholding taxes have been satisfied. Employment tax
withholding shall be calculated based on the Fair Market Value of the Shares on the applicable
Vesting Date and income tax withholding shall be calculated based on the Fair Market Value of the
Shares on the Settlement Date.
5. Rights Not Conferred. The Grantee shall have none of the rights of a stockholder
with respect to the Restricted Stock Units, including the right to receive dividends or vote stock,
until such time, if any, that Shares are distributed to the Grantee in settlement thereof. The
Grantee is further advised that until distribution, the Company’s obligation will be merely that of
an unfunded and unsecured promise of the Company to deliver Shares in the future, and the rights of
the Grantee will be no greater than that of an unsecured general creditor. No assets of the
Company will be held as collateral security for the obligations of the Company hereunder, and all
assets of the Company will be subject to the claims of the Company’s creditors.
6. Agreement Not Assignable. This Agreement and the Restricted Stock Units awarded
hereunder are not transferable or assignable by the Grantee; provided that no provision herein
shall prevent the transfer of such Restricted Stock Units or the Shares related thereto by will or
by the laws of descent or distribution in the event of the Grantee’s death.
7. Adjustments. If and to the extent that the number of Shares shall be increased or
reduced in the event of any merger, reorganization, consolidation, recapitalization, stock
dividend, stock split, reverse stock split, spin-off, combination, repurchase or exchange of Shares
or other securities of the Company, or similar corporate transaction, the number and kinds of
shares subject to the Restricted Stock Units awarded hereunder may be adjusted by the Committee, in
its sole discretion. In the event of any such transaction, the Committee may provide in
substitution for the Restricted Stock Units granted hereunder such alternative consideration as it
may determine to be equitable.
8. Governing Law. This Agreement shall be construed in accordance with and governed
by the laws of the State of Indiana.
9. Amendments. Any amendment to the Plan shall be deemed to be an amendment to this
Agreement to the extent that the amendment is applicable hereto; provided, however, that no
amendment to the Plan or the Agreement shall adversely affect the value or number of the Grantee’s
Restricted Stock Units without the Grantee’s
written consent, except to the extent necessary to comply with the provisions of Section 409A of
the Code.
10. Administration. The Committee shall have the power to interpret the Plan and this
Agreement and to adopt such rules for the administration, interpretation, and application of the
Plan as are consistent therewith and to interpret or revoke any such rules. All actions taken and
all interpretations and determinations made by the Committee shall be final and binding upon the
Grantee, the Company and all other interested persons. No member of the Committee shall be
personally liable for any action, determination or interpretation made in good faith with respect
to the Plan or this Agreement.
11. Severability. If any provision of the Plan or this Agreement is, becomes, or is
deemed to be invalid, illegal or unenforceable in any jurisdiction or would disqualify the Plan or
award hereunder under any law deemed applicable by the Committee, such provision shall be construed
or deemed amended to conform to applicable laws, or if it cannot be so construed or deemed amended
without, in the determination of the Committee, materially altering the purpose or intent of the
Plan or award, such provision shall be stricken as to such jurisdiction or award, and the remainder
of the Plan or Agreement shall be in full force and effect.
12. Construction. The Restricted Stock Units granted hereunder are being issued
pursuant to Section 10 of the Plan (“Restricted Stock Award”) and are subject to the terms of the
Plan. A copy of the Plan has been given to the Grantee, and additional copies of the Plan are
available upon request during normal business hours at the principal executive offices of the
Company. To the extent that any provision of this Agreement violates or is inconsistent with an
express provision of the Plan, the Plan provision shall govern and any inconsistent provision in
this Agreement shall be of no force or effect.
13. Binding Effect. This Agreement shall be binding upon the heirs, executors,
administrators and successors of the parties hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the day
and year first above written.
/s/ Xxxxxx X. Xxxxxxx
|
||
Grantee |
| CTS CORPORATION | ||||
By:
|
/s/ Xxxxxxx X. Xxxxxx III | |||
| Xxxxxxx X. Xxxxxx III | ||||
| Vice President, General Counsel and Secretary | ||||
CTS
CORPORATION
THIS AGREEMENT is made as of the ___day of ___, ___(the “Grant Date”) between CTS
CORPORATION, an Indiana corporation (the “Company”), and ___(the “Grantee”).
2. Grant. Subject to the terms set forth in this Agreement and in the Company’s 2004
Omnibus Long-Term Incentive Plan (the “Plan”), the Company hereby grants to the Grantee ___
Restricted Stock Units (the “Award”). Except as expressly provided herein, capitalized terms used
herein shall have the meaning ascribed to such terms under the Plan.
It is intended that this Agreement and its administration comply with the provisions of
Section 409A of the Code. Accordingly, notwithstanding any provision in this Agreement or in the
Plan to the contrary, this Agreement and the Plan will be interpreted applied and, to the minimum
extent necessary to comply with Section 409A of the Code, amended, so that the Agreement does not
fail to meet, and is operated in accordance with, the requirements of paragraphs (2), (3) and (4)
of Section 409A(a) of the Code. As used herein, “Code” means the Internal Revenue Code of 1986 as
amended from time to time, and any interpretations thereof issued by the U.S. Treasury Department
on which the Company is permitted to rely.
2. Vesting and Settlement of Restricted Stock Units. The Award shall vest and become
non-forfeitable in installments equal to twenty percent (20%) multiplied by the initial number of
Restricted Stock Units specified in Section 1 of this Agreement on each of the following dates;
___, ___, ___, ___, ___(each such date, a “Vesting Date”), provided that the Grantee remains
in the continuous employ of the Company and is an employee of the Company on the Vesting Date.
Restricted Stock Units shall be settled on the basis of one Share for each vested Restricted
Stock Unit. The Company shall distribute to the Grantee Shares equal to twenty percent (20%)
multiplied by the number of initial Restricted Stock Units specified in Section 1 above, on the
following dates, or as soon thereafter as is reasonably practicable; ___, ___, ___, ___, ___(each
such date of distribution, a “Settlement Date”). The Company’s obligations to the Grantee with
respect to vested Restricted Stock Units will be satisfied in full upon the distribution of one
Share for each Restricted Stock Unit. On the Settlement Date(s), the Company may, at its election,
either (i) credit the number of Shares to be distributed to the Grantee as of that Settlement Date
to a book-entry account in the name of the Grantee held by the Company’s transfer agent; or (ii)
credit the number of Shares to be distributed to the Grantee as of that Settlement Date to a
brokerage account designated by the Grantee. In no event may
any Settlement Date be accelerated except in accordance with Section 409A of the Code.
Notwithstanding anything to the contrary in this Agreement, upon the first to occur of the
following events, all Restricted Stock Units granted hereunder shall vest and become nonforfeitable
and Shares shall be distributed to the Grantee, estate, guardian or beneficiary of the Grantee as
the case may be, in the settlement of Restricted Stock Units as soon as reasonably practicable, and
such date(s) of distribution shall be deemed to be the Settlement Date(s):
(a) Grantee’s becoming disabled, as defined by Section 409A of the Code;
(b) Grantee’s death;
(c) To the extent permitted by Section 409A of the Code, a change in ownership or effective
control of the Company; or in the ownership of a substantial portion of the assets of the Company;
or
(d) Grantee’s unforeseeable emergency, as defined and not in excess of the amount permitted by
Section 409A of the Code.
Unless the Committee determines otherwise in its sole discretion, if the Grantee’s employment
with the Company terminates for any reason not specified above, all Restricted Stock Units granted
hereunder which have not vested as of the date of such termination of employment shall be
permanently forfeited on such termination date.
4. Tax Withholding. The Company shall have the right to deduct from any compensation
due the Grantee from the Company any federal, state, local or foreign taxes required by law to be
withheld in connection with the issuance of Shares or vesting of any Restricted Stock Unit pursuant
to this Agreement. To the extent that the amounts payable to the Grantee are insufficient for such
withholding, it shall be a condition to the issuance of Shares or vesting of the Restricted Stock
Units, as the case may be, that the Grantee shall pay such taxes or make provisions that are
satisfactory to the Company for the payment thereof.
The Grantee may, at his or her election, pay such withholding taxes in cash or by having the
Company retain Shares otherwise deliverable on the Settlement Date in an amount sufficient to
satisfy the amount of tax required to be withheld. The determination of the number of Shares
retained for this purpose shall be based on the Fair Market Value of the Shares on the Settlement
Date. In the event that the retention of Shares to satisfy withholding taxes would otherwise result
in the delivery of a fractional Share, the Company will round down to the next whole Share and
apply the value of the fractional Share to the recipient’s tax obligations or, in the alternative,
the Company may make such other arrangements to avoid the issuance of a fractional Share as may be
permitted by law. No Shares shall be transferred to the Grantee hereunder until such time as all
applicable withholding taxes have been satisfied. Employment tax
withholding shall be calculated based on the Fair Market Value of the Shares on the applicable
Vesting Date and income tax withholding shall be calculated based on the Fair Market Value of the
Shares on the Settlement Date.
5. Rights Not Conferred. The Grantee shall have none of the rights of a stockholder
with respect to the Restricted Stock Units, including the right to receive dividends or vote stock,
until such time, if any, that Shares are distributed to the Grantee in settlement thereof. The
Grantee is further advised that until distribution, the Company’s obligation will be merely that of
an unfunded and unsecured promise of the Company to deliver Shares in the future, and the rights of
the Grantee will be no greater than that of an unsecured general creditor. No assets of the
Company will be held as collateral security for the obligations of the Company hereunder, and all
assets of the Company will be subject to the claims of the Company’s creditors.
6. Agreement Not Assignable. This Agreement and the Restricted Stock Units awarded
hereunder are not transferable or assignable by the Grantee; provided that no provision herein
shall prevent the transfer of such Restricted Stock Units or the Shares related thereto by will or
by the laws of descent or distribution in the event of the Grantee’s death.
7. Adjustments. If and to the extent that the number of Shares shall be increased or
reduced in the event of any merger, reorganization, consolidation, recapitalization, stock
dividend, stock split, reverse stock split, spin-off, combination, repurchase or exchange of Shares
or other securities of the Company, or similar corporate transaction, the number and kinds of
shares subject to the Restricted Stock Units awarded hereunder may be adjusted by the Committee, in
its sole discretion. In the event of any such transaction, the Committee may provide in
substitution for the Restricted Stock Units granted hereunder such alternative consideration as it
may determine to be equitable.
8. Governing Law. This Agreement shall be construed in accordance with and governed
by the laws of the State of Indiana.
9. Amendments. Any amendment to the Plan shall be deemed to be an amendment to this
Agreement to the extent that the amendment is applicable hereto; provided, however, that no
amendment to the Plan or the Agreement shall adversely affect the value or number of the Grantee’s
Restricted Stock Units without the Grantee’s written consent, except to the extent necessary to
comply with the provisions of Section 409A of the Code.
10. Administration. The Committee shall have the power to interpret the Plan and this
Agreement and to adopt such rules for the administration, interpretation, and application of the
Plan as are consistent therewith and to interpret or revoke any such rules. All actions taken and
all interpretations and determinations made by the Committee shall be final and binding upon the
Grantee, the Company and all other interested persons. No member of the Committee shall be
personally liable for any
action, determination or interpretation made in good faith with respect to the Plan or this
Agreement.
11. Severability. If any provision of the Plan or this Agreement is, becomes, or is
deemed to be invalid, illegal or unenforceable in any jurisdiction or would disqualify the Plan or
award hereunder under any law deemed applicable by the Committee, such provision shall be construed
or deemed amended to conform to applicable laws, or if it cannot be so construed or deemed amended
without, in the determination of the Committee, materially altering the purpose or intent of the
Plan or award, such provision shall be stricken as to such jurisdiction or award, and the remainder
of the Plan or Agreement shall be in full force and effect.
12. Construction. The Restricted Stock Units granted hereunder are being issued
pursuant to Section 10 of the Plan (“Restricted Stock Award”) and are subject to the terms of the
Plan. A copy of the Plan has been given to the Grantee, and additional copies of the Plan are
available upon request during normal business hours at the principal executive offices of the
Company. To the extent that any provision of this Agreement violates or is inconsistent with an
express provision of the Plan, the Plan provision shall govern and any inconsistent provision in
this Agreement shall be of no force or effect.
13. Binding Effect. This Agreement shall be binding upon the heirs, executors,
administrators and successors of the parties hereto.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the day
and year first above written.
| Grantee: | ||||
| CTS CORPORATION | ||||
By:
|
/s/Xxxxxxx X. Xxxxxx III | |||
| Xxxxxxx X. Xxxxxx III | ||||
| Vice President, General Counsel | ||||
| and Secretary | ||||
