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EXHIBIT 10.20
DTE ENERGY COMPANY
RESTRICTED STOCK AGREEMENT
WHEREAS, XXXXXXX X. XXXXXX, XX. (the "Grantee") is an employee of The
Detroit Edison Company, a Michigan corporation and subsidiary of DTE Energy
Company; (the "Company"); and
WHEREAS, the execution of this agreement (this "Agreement") and the
grant provided herein has been authorized by a resolution of the Board of
Directors of the Company that was duly adopted on March 23, 1998 (the "Date of
Grant");
NOW, THEREFORE, the Company hereby grants to the Grantee 30,000 shares
of Common Stock of the Company (the "Restricted Stock"), effective as of the
Date of Grant and subject to the following terms, conditions, limitation and
restrictions:
ARTICLE I
DEFINITIONS
All terms used herein with initial capital letters shall have the
following meanings:
1. "Change in Control of the Company" means the occurrence of
any of the following events:
a. The Company is merged, consolidated or reorganized into or
with another corporation or other legal person, and as a
result of such merger, consolidation or reorganization less
than 55% of the combined voting power of the then-outstanding
securities of such corporation or person immediately after
such transaction is held in the aggregate by the holders of
the then-outstanding securities entitled to vote generally in
the election of directors (the "Voting Stock") of the Company
immediately prior to such transaction;
b. The Company sells or otherwise transfers all or
substantially all of its assets to another corporation or
other legal person, and as a result of such sale or transfer,
less than 55% of the combined voting power of the
then-outstanding Voting Stock of such corporation or person
immediately after such sale or transfer is held in the
aggregate (directly or through ownership of Voting Stock of
the
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Company or a Subsidiary) by the holders of Voting Stock of the
Company immediately prior to such sale or transfer;
c. There is a report filed on Schedule 13D or Schedule 14D-1
(or any successor schedule, form or report), each as
promulgated pursuant to the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), disclosing that any person
(as the term "person" is used in Section 13(d)(3) or Section
14(d)(2) of the Exchange Act) has become the beneficial owner
(as the term "beneficial owner" is defined under Rule 13d-3 or
any successor rule or regulation promulgated under the
Exchange Act) of securities representing 20% or more of the
combined voting power of the then-outstanding Voting Stock of
the Company;
d. If, during any period of two consecutive years, individuals
who at the beginning of any such period constitute the
directors of the Company cease for any reason to constitute at
least a majority thereof; provided, however, that for purposes
of this paragraph (d) each director who is first elected, or
first nominated for election, by the Company's stockholders,
by a vote of at least two-thirds of the directors of the
Company (or a committee thereof) then still in office who were
directors of the Company at the beginning of any such period
will be deemed to have been a director of the Company at the
beginning of such period; or
e. The approval of the shareholders of the Company of a
complete liquidation or dissolution of the Company.
Notwithstanding the foregoing provisions of paragraph (c)
above, unless otherwise determined in a specific case by
majority vote of the Board of Directors of the Company, a
"Change in Control" shall not be deemed to have occurred for
purposes of paragraph (c) solely because (i) the Company (ii)
a Subsidiary, or (iii) any Company-sponsored employee stock
ownership plan or any other employee benefit plan of the
Company or any Subsidiary either files or becomes obligated to
file a report or a proxy statement under or in response to
Schedule 13D or Schedule 14D-1 (or any successor schedule,
form or report or item therein) under the Exchange Act
disclosing beneficial ownership by it of shares of Voting
Stock, whether in excess of 20% or otherwise.
2. "Restriction Period" means the period commencing on the Date
of Grant and ending on August 1, 2000.
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3. "Subsidiary" means an entity in which the Company directly or
indirectly beneficially owns 50% or more of the outstanding Voting Stock (as
defined in Section 1(a) above).
4. "Vesting Cycle" means each of the following three periods during the
Restriction Period: the period commencing on the Date of Grant and ending on
August 1, 1998; the period beginning on the Date of Grant and ending on August
1, 1999; and the period beginning on the Date of Grant and ending on August 1,
2000.
ARTICLE II
CERTAIN TERMS OF RESTRICTED STOCK
1. Issuance of Restricted Stock. The shares of Restricted Stock covered
by this Agreement shall be shares of Common Stock of the Company (the "Common
Stock") purchased by the Company in the open market for the Grantee. Such shares
shall be represented by a certificate or certificates registered in the
Grantee's name, which shall be endorsed with an appropriate legend referring to
the restrictions hereinafter set forth.
2. Restrictions on Transfer of Shares. The shares of Common Stock
subject to this grant of Restricted Stock may not be sold, exchanged, assigned,
transferred, pledged, encumbered or otherwise disposed of by the Grantee except
to the Company until the shares of Restricted Stock have become nonforfeitable
as provided in Section 3 hereof, provided, however, that the Grantee's rights
with respect to such shares of Common Stock may be transferred by will or
pursuant to the laws of descent and distribution. Any purported transfer or
encumbrance in violation of the provisions of this Section 2 of this Article II
shall be void, and the other party to any such purported transaction shall not
obtain any rights to or interest in such shares of Common Stock.
3. Vesting of Restricted Stock.
a) So long as the Grantee shall have remained in the
continuous employ of the Company or a Subsidiary during a
Vesting Cycle, one-third of the shares of Restricted Stock
granted by this Agreement shall become nonforfeitable on the
last day of such vesting Cycle.
b) Notwithstanding the provisions of Section 3(a) hereof, the
Restricted Stock shall become immediately and fully vested and
nonforfeitable upon (i) any "Change in Control of the Company"
that shall occur while the Grantee is an employee of the
Company or a Subsidiary or (ii) Grantee's termination of
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employment by the Company or Subsidiary due to the Grantee's
total and permanent disability as defined in the Detroit
Edison Company's Long Term Disability Plan or by reason of
Grantee's death.
4. Forfeiture of Shares. Any shares of Restricted Stock covered by this
Agreement that have not become nonforfeitable pursuant to Section 3 shall be
forfeited, except as provided in Section 3, if the Grantee's employment with the
Company or a Subsidiary is terminated any time prior to the end of the
Restricted Period. In the event of a forfeiture, the certificate(s) representing
the shares of Restricted Stock covered by this Agreement that have been
forfeited shall be canceled.
5. Dividend, Voting and Other Rights. Except as otherwise provided
herein, from and after the Date of Grant, the Grantee shall have all of the
rights of a shareholder with respect to the shares of Restricted Stock covered
by this Agreement, including the right to vote such shares of Restricted Stock
and receive any dividends that may be paid thereon; provided, however, that any
additional shares of Common Stock or other securities that the Grantee may
become entitled to receive in respect of the Restricted Stock pursuant to a
stock dividend, stock split, combination of shares, recapitalization, merger,
consolidation, separation or reorganization or any other change in the capital
structure of the Company shall be subject to the same restrictions as the shares
of Restricted Stock covered by this Agreement.
6. Retention of Stock Certificate(s) by the Company. The certificate(s)
representing the Restricted Stock covered by this Agreement shall be held in
custody by the Company, together with a stock power endorsed in blank by the
Grantee with respect thereto, until those shares have become nonforfeitable in
accordance with Section 3 of this Article II. Upon the lapse of the possibility
of forfeiture with respect to any shares of Restricted Stock, the Company will
deliver to Grantee a new certificate for such shares, subject to compliance with
Section 2 of Article III below and to the inclusion of any legend made necessary
or advisable by the articles of Incorporation or By-laws of the Company or any
other agreement Grantee may have entered into with the Company or other
stockholders thereof or by reason of non-registration under the Securities Act
of 1933 (the "Act").
ARTICLE III
GENERAL PROVISIONS
1. Compliance with Law. The Company shall make reasonable efforts to
comply with all applicable law; provided, however, notwithstanding any other
provision of this
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Agreement, the Company shall not be obligated to issue any shares of Common
Stock pursuant to this Agreement if the issuance thereof would result in a
violation of any federal or state securities laws or any other regulatory
requirement. The Grantee understands that the Restricted Stock has not been
registered under the Act. Upon the lapse of the restrictions on transfer
relating thereto, the Grantee agrees that Grantee will not make any sale or
other disposition of such shares in any manner that would violate the Act.
2. Withholding Taxes. If the Company or any Subsidiary shall be
required to withhold any federal, state, local or foreign tax in connection with
any issuance or vesting of shares of Common Stock or other securities pursuant
to this Agreement, the Grantee shall remit such tax to the Company or Subsidiary
for deposit with the applicable taxing authority under the applicable tax
withholding rules or make provisions that are satisfactory to the Company or
such Subsidiary for the payment thereof, and the Company may defer the issuance
of a certificate evidencing shares of the Restricted Stock, or the issuance of a
new certificate evidencing the lapse of the restrictions thereon, until such
payment or provision has been made. The Grantee may elect that all or part of
such withholding requirement be satisfied by (a) a cash payment, (b) by transfer
to the Company of nonforfeitable, unrestricted shares of Common Stock (which
have been owned by the Grantee for more than six months prior to the date of
transfer and which have a fair market value based on the Fair Market Price (as
defined below) on the date of transfer equal to the withholding obligation), (c)
by authorizing the Company to withhold a portion of the nonforfeitable shares to
be issued to Grantee which have a fair market value based on the Fair Market
Price on the date such shares become nonforfeitable, or (d) a combination of
such methods. For this purpose, Fair Market Price is defined as the average of
the high and low sales prices of Common Stock as traded on the New York Stock
Exchange.
3. Continuous Employment. For purposes of this Agreement, the
continuous employment of the Grantee with the Company or a Subsidiary shall not
be deemed to have been interrupted, and the Grantee shall not be deemed to have
ceased to be an employee of the Company or a Subsidiary, by reason of the
transfer of his employment among the Company and its Subsidiaries or, if so
determined by the Special Committee on Compensation (the "Committee") of the
Board of Directors of the Company, a leave of absence.
4. Right to Terminate Employment. No provision of this Agreement shall
limit in any way whatsoever any right that the Company or a Subsidiary may
otherwise have to terminate the employment of the Grantee at any time.
5. Relation to Other Benefits. Awards under the Plan are not considered
compensation for purposes of the Company's qualified and non-qualified savings
plans, the Company's qualified and non-qualified retirement plans, insurance or
any other Company-sponsored qualified or non-qualified employee benefit
programs.
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6. Amendments. This Agreement may be amended only by a writing executed
by the Company and the Grantee.
7. Severability. In the event that one or more of the provisions of
this Agreement shall be invalidated for any reason by a court of competent
jurisdiction, any provision so invalidated shall be deemed to be separable from
the other provisions hereof, and the remaining provisions hereof shall continue
to be valid and fully enforceable.
8. Governing Law. This agreement is made under, and shall be construed
in accordance with, the internal substantive laws of the State of Michigan.
9. Administration. The Committee shall be authorized to interpret this
Agreement and make other determination which it believes necessary or advisable
for the administration of this Agreement.
This Agreement is executed by the Company as of the 23rd day of March,
1998.
DTE ENERGY COMPANY
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Xxxx X. Xxxxxx
Chairman and Chief Executive Officer
The undersigned hereby acknowledges receipt of an executed original of
this Restricted Stock Agreement and accepts the award of Restricted Stock
granted thereunder on the terms and conditions set forth herein.
Date: March 23, 1998 ----------------------------
Xxxxxxx X. Xxxxxx, Xx.
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