EXHIBIT 10.2
CHARMING SHOPPES, INC.
1993 EMPLOYEES' STOCK INCENTIVE PLAN
RESTRICTED STOCK AGREEMENT
Agreement dated as of October 12, 1999 between CHARMING SHOPPES, INC.
(the "Company") and XXXXXX X. XXXX ("Employee").
It is agreed as follows:
1. GRANT OF RESTRICTED STOCK; CONSIDERATION
The Company hereby confirms the grant, under and pursuant to the
Company's 1993 Employees' Stock Incentive Plan (the "Plan"), to Employee on
October 12, 1999 (the "Date of Grant") of 200,000 shares of the Company's
common stock, par value $0.10 per share ("Shares"), granted pursuant to
Section 6(d) of the Plan and subject to restrictions as set forth herein and
therein ("Restricted Stock" or "Award"). Employee shall be required to pay no
cash consideration for the grant of the Restricted Stock, but Employee's prior
services to the Company, performance of services to the Company prior to the
expiration of applicable restrictions relating to the Restricted Stock and
otherwise during the term of her employment agreement, and her agreement to
abide by the terms set forth in the Plan and this Restricted Stock Agreement
(the "Agreement") shall be deemed to be consideration for the Award.
2. INCORPORATION OF PLAN BY REFERENCE
The Award has been granted to Employee under the Plan, a copy of which
is attached hereto. All of the terms, conditions and other provisions of the
Plan are hereby incorporated by reference into this Agreement. Capitalized
terms used in this Agreement but not defined herein shall have the same
meanings as in the Plan. If there is any conflict between the provisions of
this Agreement and the provisions of the Plan, the provisions of the Plan
shall govern.
3. RESTRICTIONS ON RESTRICTED STOCK AND RELATED TERMS
(a) Restrictions Generally. Until they expire in accordance with
Section 3(b), 3(c), or 5(a), the following restrictions (the
"Restrictions") shall apply to the Restricted Stock: Employee shall
have no right to sell, transfer, assign, pledge, or otherwise encumber
or dispose of the Restricted Stock (except for transfers and forfeitures
to the Company); and the Restricted Stock shall be subject to the risk
of forfeiture as set forth in Section 3(b). Employee shall be entitled
to receive dividends on the Restricted Stock when, as, and if dividends
are declared and paid on Shares, shall be entitled to vote Restricted
Stock on any matter submitted to a vote of holders of Common Stock, and
shall have all other rights of a shareholder of the Company except as
otherwise expressly provided under this Section 3.
(b) Forfeiture. Unless otherwise determined by the Committee, if
Employee's employment terminates and she thereafter is not an employee
by the Company or any of its subsidiaries (a "Termination") prior to the
expiration of the Restrictions for any reason other than due to death,
permanent disability, involuntary termination by the Company for reasons
other than "Cause," or voluntary termination by Employee for "Good
Reason," the Restricted Stock as to which Restrictions have not
previously expired shall be forfeited at the time of such Termination.
In the event of a Termination due to death, permanent disability,
involuntary termination by the Company for reasons other than "Cause,"
or a voluntary termination by Employee for "Good Reason," the
Restrictions on the Restricted Stock shall expire at the time of such
Termination. For purposes of this Agreement, "Cause" and "Good Reason"
shall have the meanings ascribed to such terms in the Employment
Agreement between Employee and the Company, as in effect at the Date of
Grant. The foregoing notwithstanding, the Committee shall independently
make any determination that "Cause" exists, but only if the Board of
Directors previously has made such determination pursuant to the
Employment Agreement. For purposes of this Agreement, the existence of a
"permanent disability" shall be determined by, or in accordance with
criteria and standards adopted by, the Committee.
(c) Expiration of Restrictions. Unless the Restrictions on
Restricted Stock expire earlier under Section 3 (b) or 5 (a), the
Restrictions shall expire as to 40,000 shares of Restricted Stock on
each of the first, second, third, fourth and fifth anniversaries of the
Date of Grant. Upon expiration of the Restrictions on any Restricted
Stock, the Company shall promptly deliver to Employee one or more
certificates representing such Shares (which shall no longer be deemed
to be Restricted Stock), with any legend referring to the Restrictions
removed from such certificate(s) , or shall cause such Shares to be
delivered to a broker or bank which maintains an account for Employee or
Employee's designee, for deposit to such account.
(d) Certificates Representing Restricted Stock. Restricted Stock
shall be evidenced by issuance of one or more certificates in the name
of Employee, bearing an appropriate legend referring to the terms,
conditions, and Restrictions applicable hereunder, and shall remain in
the physical custody of the General Counsel of the Company or his
designee until such time as the Restrictions on such shares have
expired. In addition, Restricted Stock shall be subject to such stop-
transfer orders and other restrictive measures as the General Counsel of
the Company shall deem advisable under federal or state securities laws,
rules and regulations thereunder, and the rules of the Nasdaq National
Market System or any national securities exchange on which Common Stock
is then quoted or listed, or to implement the Restrictions, and the
General Counsel may cause a legend or legends to be placed on any such
certificates to make appropriate reference to the Restrictions.
(e) Stock Powers. Employee agrees to execute and deliver to the
Company one or more stock powers, in such form as may be specified by
the General Counsel, authorizing the transfer of the Restricted Stock to
the Company, at the Date of Grant of the Restricted Stock or upon
request at any time thereafter.
4. TAX WITHHOLDING
Employee agrees to remit to the Company and any subsidiary, and
authorizes the Company and any subsidiary to deduct from any payment to be
made to Employee hereunder if such remittance has not been made, any amount
that federal, state, local, or foreign tax law requires to be withheld with
respect to the grant of Restricted Stock or delivery of Shares hereunder. At
the election of the Committee, the Company may withhold from the number of
Shares to be delivered upon expiration of Restrictions on Restricted Stock a
number of whole shares up to but not exceeding that number which has a Fair
Market Value nearest to but not exceeding the amount of taxes required to be
withheld with respect to such expiration of Restrictions; provided, however,
no such withholding shall be permitted if Employee elects to be taxed on the
grant of Restricted Stock, under Section 83(b) of the Code, prior to
expiration of Restrictions.
5. CHANGE OF CONTROL PROVISIONS
(a) Acceleration of Expiration of Restrictions. In the event of a
Change of Control at any time after the date of grant of the Restricted Stock,
the Restrictions on the Restricted Stock shall immediately expire.
(b) Definitions of Certain Terms. For purposes of this Agreement, the
following definitions shall apply:
(1) "Beneficial Owner," "Beneficially Owns," and "Beneficial
Ownership" shall have the meanings ascribed to such terms for purposes
of Section 13(d) of the Exchange Act and the rules thereunder, except
that, for purposes of this Section 5, "Beneficial Ownership" (and the
related terms) shall include Voting Securities that a Person has the
right to acquire pursuant to any agreement, or upon exercise of
conversion rights, warrants, options, or otherwise, regardless of
whether any such right is exercisable within 60 days of the date as of
which Beneficial Ownership is to be determined.
(2) "Change of Control" means and shall be deemed to have
occurred if
(i) any Person, other than the Company or a Related Party,
acquires directly or indirectly the Beneficial Ownership of any
Voting Security of the Company and immediately after such
acquisition such Person has, directly or indirectly, the
Beneficial Ownership of Voting Securities representing 20 percent
or more of the total voting power of all the then-outstanding
Voting Securities; or
(ii) those individuals who as of the Date of Grant
constitute the Board or who thereafter are elected to the Board
and whose election, or nomination for election, to the Board was
approved by a vote of at least two-thirds (2/3) of the directors
then still in office who either were directors as of the Date of
Grant or whose election or nomination for election was previously
so approved, cease for any reason to constitute a majority of the
members of the Board; or
(iii) the shareholders of the Company approve a merger,
consolidation, recapitalization, or reorganization of the Company,
a reverse stock split of outstanding Voting Securities, or an
acquisition of securities or assets by the Company (a
"Transaction"), or consummation of such a Transaction if
shareholder approval is not obtained, other than a Transaction
which would result in the holders of Voting Securities having at
least 80 percent of the total voting power represented by the
Voting Securities outstanding immediately prior thereto continuing
to hold Voting Securities or voting securities of the surviving
entity having at least 60 percent of the total voting power
represented by the Voting Securities or the voting securities of
such surviving entity outstanding immediately after such
Transaction and in or as a result of which the voting rights of
each Voting Security relative to the voting rights of all other
voting securities are not altered; provided, however, a Change of
Control shall not be deemed to have occurred if the Committee
shall have determined, by action taken prior to the approval of
the Transaction by shareholders or consummation of the Transaction
if shareholder approval is not obtained, that such Transaction
shall not constitute a Change of Control for purposes of this
Agreement (provided that the Committee shall make no such
determination unless the Board shall have determined that such
Transaction shall not constitute a Change of Control for purposes
of Employee's Employment Agreement with the Company made as of
October 12, 1999 and all other Awards then outstanding under the
Plan, which determination, if made with respect to a Transaction,
shall not be deemed to constitute a determination with respect to
any subsequent Transaction; or
(iv) he shareholders of the Company approve a plan of
complete liquidation of the Company or an agreement for the sale
or disposition by the Company of all or substantially all of the
Company's assets other than any such transaction which would
result in Related Parties owning or acquiring more than 50 percent
of the assets owned by the Company immediately prior to the
transaction.
(3) "Person" shall have the meaning ascribed for purposes of
Section 13(d) of the Exchange Act and the rules thereunder.
(4) "Related Party" means (i) a majority-owned subsidiary of the
Company; or (ii) a trustee or other fiduciary holding securities under
an employee benefit plan of the Company or any majority-owned subsidiary
of the Company; or (iii) a corporation owned directly or indirectly by
the shareholders of the Company in substantially the same proportion as
their ownership of Voting Securities; or (iv) if, prior to any
acquisition of a Voting Security which would result in any Person
Beneficially Owning more than ten percent of any outstanding class of
Voting Security and which would be required to be reported on a Schedule
13D or an amendment thereto, the Board approved the initial transaction
giving rise to an increase in Beneficial Ownership in excess of ten
percent and any subsequent transaction giving rise to any further
increase in Beneficial Ownership; provided, however, that such Person
has not, prior to obtaining Board approval of any such transaction,
publicly announced an intention to take actions which, if consummated or
successful (at a time such Person has not been deemed a "Related
Party"), would constitute a Change of Control.
(5) "Voting Securities" means any securities of the Company which
carry the right to vote generally in the election of directors.
6. EMPLOYEE BOUND BY PLAN
Employee hereby acknowledges receipt of the attached copy of the Plan
and agrees to be bound by all the terms and provisions thereof (as presently
in effect or hereafter amended), and by all decisions and determinations of
the Committee thereunder.
7. MISCELLANEOUS
This Agreement shall be binding upon the heirs, executors,
administrators, and successors of the parties. This Agreement constitutes the
entire agreement between the parties with respect to the Award, and supersedes
any prior agreements or documents with respect to the Award. No amendment,
alteration, suspension, discontinuation, or termination of this Agreement
which may impose any additional obligation upon the Company or materially
impair the rights of Employee with respect to the Award shall be valid unless
in each instance such amendment, alteration, suspension, discontinuation, or
termination is expressed in a written instrument duly executed in the name and
on behalf of the Company and by Employee.
CHARMING SHOPPES, INC.
By:__________________________
Executive Vice President and
Chief Financial Officer
EMPLOYEE:
By: __________________________
Xxxxxx X. Xxxx
STOCK POWER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto Charming Shoppes, Inc. _____________ shares of Common Stock, $0.10 par
value per share, of Charming Shoppes, Inc., a Pennsylvania corporation (the
"Corporation"), registered in the name of the undersigned on the books and
records of the Corporation, and does hereby irrevocably constitute and appoint
Xxxxx X. Xxxxx and Xxxxxxx X. XxXxxxxx, and each of them, attorneys, to
transfer the Common Stock on the books of the Corporation, with full power of
substitution in the premises.
_______________________________________
Signed (Signature should be in exact form
as on Stock certificate)
_______________________________________
Date
