RESTRICTED STOCK AWARD AGREEMENT UNDER THE HCC INSURANCE HOLDINGS, INC.
Exhibit 10.2
UNDER THE HCC INSURANCE HOLDINGS, INC.
2008 FLEXIBLE INCENTIVE PLAN
This Restricted Stock Award Agreement (this “Agreement”) is entered into effective as of the
date of grant set forth on the signature page below (the “Grant Date”) by and between HCC Insurance
Holdings, Inc., a Delaware corporation (the “Company”), and the undersigned employee of the Company
or its Subsidiary (the “Employee”). Capitalized terms used herein and not otherwise defined shall
have the meaning specified in the HCC Insurance Holdings, Inc. 2008 Flexible Incentive Plan, as
amended and restated and as further amended (the “Plan”).
WHEREAS, under the terms of the Plan the Committee may grant awards of Restricted Stock to
Participants in the Plan;
WHEREAS, Employee is an eligible Participant in the Plan; and
WHEREAS, the Committee has approved an award of Restricted Stock to Employee on the terms and
conditions hereof and subject to the restrictions set forth herein as an incentive for Employee’s
performance of services for the Company and/or its Subsidiaries;
NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained and
other good and valuable consideration, the parties hereto agree as follows:
1. Grant of Restricted Shares. As of the Grant Date, the Company hereby grants and
conveys to Employee the number of Shares of Restricted Stock specified on the signature page of
this Agreement (the “Restricted Shares”).
(a) The Restricted Shares shall be subject to the terms of the Plan, which terms are
incorporated herein by this reference. Except to the extent expressly provided by the Plan, in the
event of any conflict between the terms of this Agreement and those of the Plan, the terms of the
Plan, including those with respect to the powers of the Committee, shall prevail and be
controlling.
(b) The Restricted Shares shall be registered in Employee’s name as of the Grant Date through
a book entry credit in the records of the Company’s transfer agent, but shall be restricted as
described herein during the period prior to the vesting of such shares in accordance with Section 3
(the “Restriction Period”). During the Restriction Period, any certificates representing the
Restricted Shares shall carry a legend evidencing the restrictions of this Agreement. The terms of
any such legend shall be determined by the Committee in its sole discretion.
(c) If, from time to time during the Restriction Period, there is any stock dividend, stock
split, reorganization, recapitalization, merger, or other event described in Section 14 of the
Plan, any and all new, substituted, additional, or other securities to which Employee is entitled
by reason of his ownership of the Restricted Shares shall be considered “Restricted Shares” for
purposes of this Agreement and shall be subject to the restrictions described in Section 2 during
the Restriction Period.
(d) Subject to the restrictions set forth in Section 2, Employee shall have all the rights of
a stockholder with respect to the Restricted Shares, including any applicable voting and dividend
rights.
2. Restrictions.
(a) During the Restriction Period, Employee shall not sell, transfer, pledge, assign,
alienate, hypothecate, or otherwise encumber or dispose of the Restricted Shares other than by will
or the laws of descent and distribution. Any attempt to do so contrary to the foregoing shall be
null and void.
(b) If Employee terminates employment with the Company prior to the end of the Restriction
Period, the unvested Restricted Shares shall be forfeited and returned to the Company without the
payment of any consideration, and Employee shall have no rights with respect to such forfeited
shares. For purposes of this Agreement, Employee shall be considered to be an employee of the
Company for so long as Employee is a common law employee of the Company or any Subsidiary, and
Employee’s employment relationship with an entity which was a Subsidiary shall be deemed to have
terminated as of the date on which such entity ceased to be a Subsidiary (even if Employee does not
experience a common law termination of employment at such time).
3. Vesting. The Restricted Shares granted hereunder shall fully vest, and the
restrictions imposed pursuant to Section 2 shall lapse immediately prior to the first to occur of
the following:
(a) the fourth anniversary of the Grant Date;
(b) the date of Employee’s death;
(c) the date Employee terminates employment with the Company due to Employee’s Disability;
(d) the date Employee’s employment with the Company is involuntarily terminated by the Company
other than for “Cause” (as defined below). Employee’s employment with the Company shall be
considered involuntarily terminated by the Company other than for cause if Employee is transferred
to or employed by an entity other than the Company or a Subsidiary in connection with a
divestiture, spinoff, outsourcing, or similar business transaction, even if Employee does not
experience a common law termination of employment in connection with such event or transaction.
For purposes of this Agreement and notwithstanding the terms of any other agreement between
Employee and the Company, the term “Cause” shall mean (a) material dishonesty by Employee which is
not the result of an inadvertent or innocent mistake of Employee with respect to the Company or any
Subsidiary; (b) willful misfeasance or nonfeasance of duty by Employee; (c) a material violation by
Employee of any material term of his written employment agreement (if any) with the Company or any
Subsidiary as determined in the sole discretion of the Company; or (d) conviction of Employee of
any felony, any crime involving moral turpitude, or any crime (other than a vehicular offense not
involving DUI or personal injury) which in some material fashion results in the injury of the
Company’s or any Subsidiary’s reputation, business, or business relationships;
(e) the date of a Change in Control of the Company; and
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(f) the date on which the Restricted Shares are cancelled in exchange for cash or property
(other than securities which are considered Restricted Shares pursuant to Section 1(c)) in
connection with a merger or other business transaction, reorganization, or event that is not a
Change in Control.
4. Delivery of Share Certificates; Compliance with Securities Laws. Upon the vesting
of any Restricted Shares granted hereunder, the Company shall direct its transfer agent to record
such shares as unrestricted or to deliver to Employee certificates evidencing such Restricted
Shares. If certificates are delivered to Employee, such certificates shall not bear the legend
referenced in Section 1(b). Nothing herein shall obligate the Company to register the Restricted
Shares pursuant to any applicable securities law or to take any other affirmative action in order
to cause the issuance or transfer of the Restricted Shares to comply with any law or regulation of
any governmental authority.
5. Tax Consequences; Tax Withholding.
(a) Employee shall be responsible for his own tax liability that arises as the result of this
Agreement. Employee acknowledges and understands that he may make an election under section 83(b)
of the Code within 30 days after the Grant Date.
(b) Employee shall pay to the Company, or make arrangements satisfactory to the Company
regarding payment to the Company of, the aggregate amount of any federal, state, and local income,
employment, Social Security, Medicare, and other taxes that the Company is required to withhold in
connection with the Restricted Shares. The Company shall have the right to deduct any such taxes
from any amounts paid to Employee by the Company or any Subsidiary.
6. Notices. Every notice or other communication relating to this Agreement shall be
in writing, and shall be mailed to or delivered to the party for whom it is intended at such
address as may from time to time be designated by him in a notice mailed or delivered to the other
party. Unless and until some other address is so designated, all notices or communications by
Employee to the Company shall be mailed or delivered to the Company, care of its General Counsel,
at 00000 Xxxxxxxxx Xxxxxxx, Xxxxxxx, Xxxxx 00000-0000, and all notices or communications by the
Company to Employee shall be mailed or delivered to Employee’s address specified on the signature
page to this Agreement.
7. Amendments and Waivers. Any provision of this Agreement may be amended or waived
if, and only if, such amendment or waiver is in writing and is signed, in the case of an amendment,
by the Company and Employee, or in the case of a waiver, by the party against whom the waiver is to
be effective. No failure or delay by any party in exercising any right or privilege hereunder
shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right, power, or privilege. To the
maximum extent permitted by law, (a) no waiver that may be given by a party shall be applicable
except in the specific instance for which it was given and (b) no notice to or demand on one party
shall be deemed to be a waiver of any obligation of such party or the right of the party giving
such notice or demand to take further action without notice or demand.
8. No Right to Continued Service. This Agreement does not confer upon Employee any
right to remain in the employ of the Company or any Subsidiary, nor shall it interfere in any
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way with the right of the Company and its Subsidiaries to terminate or change the conditions
of his employment at any time.
9. Successors and Assigns; Binding Effect. This Agreement, and the rights and
obligations of the parties hereunder, may not be assigned by any party hereto other than by will or
the laws of descent and distribution. All of the terms and provisions of this Agreement shall
inure to the benefit of and be binding upon the parties hereto and their respective executors,
heirs, personal representatives, successors, and permitted assigns.
10. Entire Agreement. This Agreement, along with the Plan and any other written
agreement between the parties specifically incorporated herein by reference, sets forth the entire
understanding of the parties hereto with respect to the grant of the Restricted Shares to Employee.
Any and all previous agreements and understandings between or among the parties regarding the
subject matter hereof, whether written or oral, are superseded by this Agreement.
11. Interpretation. The meaning assigned to each term defined herein shall be equally
applicable to both the singular and the plural forms of such term and vice versa, and words
denoting either gender shall include both genders as the context requires. Where a word or phrase
is defined herein, each of its other grammatical forms shall have a corresponding meaning. The
terms “hereof,” “herein” and “herewith” and words of similar import shall, unless otherwise stated,
be construed to refer to this Agreement as a whole and not to any particular provision of this
Agreement. When a reference is made in this Agreement to a Section, such reference is to a Section
of this Agreement unless otherwise specified. The word “include”, “includes”, and “including” when
used in this Agreement shall be deemed to be followed by the words “without limitation”, unless
otherwise specified. A reference to any party to this Agreement or any other agreement or document
shall include such party’s predecessors, successors, and permitted assigns. Reference to any law
means such law as amended, modified, codified, replaced, or reenacted, and all rules and
regulations promulgated thereunder. All captions contained in this Agreement are for convenience
of reference only, do not form a part of this Agreement, and shall not affect in any way the
meaning or interpretation of this Agreement. The parties have participated jointly in the
negotiation and drafting of this Agreement; therefore any rule of construction or interpretation
otherwise requiring this Agreement to be construed or interpreted against any party by virtue of
the authorship of this Agreement shall not apply to the construction and interpretation hereof.
12. Severability. Any provision of this Agreement which is invalid or unenforceable
in any applicable jurisdiction shall be ineffective to the extent of such invalidity or
unenforceability without invalidating or rendering unenforceable the remaining provisions hereof,
and any such invalidity or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
13. Governing Law and Venue. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas, without regard to the conflicts of laws principles
thereof. To the maximum extent practicable this Agreement calls for performance and shall be
performable at the offices of the Company in Houston, Xxxxxx County, Texas and venue for any
dispute arising hereunder shall lie exclusively in the state and/or federal courts of Xxxxxx
County, Texas and the Southern District of Texas, Houston Division, respectively.
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14. Signature in Counterparts. This Agreement may be signed in counterparts, each of
which shall be an original, with the same effect as if the signatures thereto and hereto were upon
the same instrument. The parties agree that the delivery of this Agreement may be effected by
means of an exchange of facsimile signatures which shall be deemed original signatures thereof.
15. EXPIRATION OF AGREEMENT. IF THIS AGREEMENT IS NOT SIGNED AND RETURNED TO THE
COMPANY WITHIN 30 DAYS AFTER THE GRANT DATE, THIS AGREEMENT AND THE RESTRICTED STOCK AWARD PROVIDED
FOR HEREIN SHALL BE NULL AND VOID.
[SIGNATURE PAGE TO RESTRICTED STOCK AWARD AGREEMENT]
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