1
Exhibit 10.49
XXXX NATIONAL CORPORATION
Restricted Stock Agreement
--------------------------
THIS RESTRICTED STOCK AGREEMENT (as amended, modified or supplemented
from time to time, this "AGREEMENT") is made by and between Xxxx National
Corporation, a Delaware corporation (the "COMPANY"), and Xxxxxxx X. Xxxx, an
individual residing in the State of Ohio (the "GRANTEE").
PRELIMINARY STATEMENTS:
A. The Grantee is an employee of Xxxx National Group, Inc., a Delaware
corporation, Xxxx Vision Corporation, a Delaware corporation, and Things
Remembered, Inc., a Delaware corporation; and
B. The execution of a restricted stock agreement in the form hereof has
been authorized by a resolution of the Special Compensation Committee (the
"COMMITTEE") of the Board of Directors of the Company (the "BOARD");
NOW, THEREFORE, in consideration of the Grantee's acceptance
of the terms and conditions of this Agreement, and subject to the terms of this
Agreement, the Company hereby grants to the Grantee 225,000 shares (together
with all other shares of Common Stock that become subject to this Agreement,
collectively, the "SHARES") of the Company's common stock, par value $.001 per
share ("COMMON STOCK"), 123,750 Shares (the "PLAN SHARES") of which are granted
pursuant to and are subject to the terms and conditions of the Company's 1998
Equity and Incentive Performance Plan (the "PLAN"),and 101,250 of which are to
be issued out of the Company's treasury solely pursuant to this Agreement (the
"NON-PLAN SHARES"):
AGREEMENT:
1. ISSUANCE OF COMMON STOCK. The Shares will be issued on the
date of this Agreement as fully paid and nonassessable shares and will be
represented by certificates registered in the name of the Grantee and bearing a
legend referring to the restrictions set forth in this Agreement.
2. RESTRICTION ON TRANSFER OF COMMON STOCK. The Shares may not
be transferred, sold, pledged, exchanged, assigned or otherwise encumbered or
disposed of by the Grantee, except to the Company, until they have become
nonforfeitable in accordance with Section 3 of this Agreement; PROVIDED,
HOWEVER, that the Grantee's interest in the Shares may be transferred at any
time by will or the laws of descent and distribution if the recipient of the
Shares enters into an agreement with the Company (in form and substance
acceptable to the Company) agreeing to be bound by the provisions of this
Agreement as if such transferee were the Grantee. Any purported transfer,
encumbrance or other disposition of the Shares that is in violation of this
Section 2 will be
2
null and void, and the other party to any such purported transaction will not
obtain any rights to or interest in the Shares. When and as permitted by the
Plan, the Committee or the Board may waive the restrictions set forth in this
Section 2 with respect to all or any portion of the Shares granted under the
Plan.
3. VESTING OF COMMON STOCK. (a) Except as set forth in Section
4, the Non-Plan Shares are nonforfeitable. The Plan Shares will become
nonforfeitable upon the occurrence of the following:
Amount Nonforfeitable Date Nonforfeitable
--------------------- -------------------
1/3 of the Plan Shares On the first date on or after March 1,
2002 on which the Stock Price has
averaged at least 133% of the Initial
Price for a continuous period of 21
consecutive Trading Days ending on such
date.
1/3 of the Plan Shares On the first date on or after March 1,
2002 on which the Stock Price has
averaged at least 167% of the Initial
Price for a continuous period of 21
consecutive Trading Days ending on such
date.
1/3 of the Plan Shares On the first date on or after March 1,
2002 on which the Stock Price has
averaged at least 200% of the Initial
Price for a continuous period of 21
consecutive Trading Days ending on such
date.
All Plan Shares not otherwise March 1, 2004.
Nonforfeitable
For purposes of this Agreement, the continuous employment of the Grantee with
the Company or a Subsidiary will not be deemed to have been interrupted, and the
Grantee will 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 a leave of absence approved by the Committee.
(b) Notwithstanding the provisions of Section 3(a), all of the Shares
will immediately become nonforfeitable if a Change in Control occurs after the
Grant Date. "CHANGE OF CONTROL" means if at any time any of the following events
has occurred:
(i) the Company merges itself, or is merged or consolidated with,
another corporation and as a result of such merger or
consolidation less than 51% of the voting power of the
then-outstanding voting securities of the surviving
corporation immediately after such transaction are directly or
indirectly
2
3
beneficially owned in the aggregate by the former stockholders
of the Company immediately prior to such transaction;
(ii) all or substantially all the assets accounted for on the
Consolidated Balance Sheet of the Company are sold or
transferred to one or more corporations or persons, and as a
result of such sale or transfer less than 51% of the voting
power of the then-outstanding voting securities of such
corporation or person immediately after such sale or transfer
is directly or indirectly beneficially held in the aggregate
by the former stockholders of the Company immediately prior to
such transaction or series of transactions;
(iii) a person, within the meaning of Section 3(a)(9) or 13(d)(13)
(as in effect on the date of the award) of the Securities
Exchange Act of 1934, as amended (the "EXCHANGE ACT"), becomes
the beneficial owner (as defined in Rule 13d-3 of the
Securities and Exchange Commission pursuant to the Exchange
Act) of (i) 15% or more but less than 35% of the voting power
of the then-outstanding voting securities of the Company
without prior approval of the Company's Board, or (ii) 35% or
more of the voting power of the then-outstanding voting
securities of the Company; PROVIDED, HOWEVER, that the
foregoing does not apply to any such acquisition that is made
by (w) any Subsidiary of the Company (x) any employee benefit
plan of the Company or any Subsidiary or (y) any person or
group of which employees of the Company or of any Subsidiary
control a greater than 25% interest unless the Board
determines that such person or group is making a "hostile
acquisition;"
(iv) a majority of the members of the Board or of any Subsidiary
are not Continuing Directors, where a "CONTINUING DIRECTOR" is
any member of the Board or, with respect to a Subsidiary, of
such Subsidiary who (x) was a member of the Board or, with
respect to a Subsidiary, of such Subsidiary on the date of the
award or (y) was nominated for election or elected to such
Board with the affirmative vote of a majority of the
Continuing Directors who were members of such Board at the
time of such nomination or election.
(c) Notwithstanding the provisions of Section 3(a), all of the Shares
will immediately become nonforfeitable if the Grantee (i) dies or becomes
disabled (as defined in the Plan) while in the employ of the Company or a
Subsidiary after the Grant Date, or (ii) with the consent of the Board or the
Committee, retires after the Grant Date from the Company or a Subsidiary under a
retirement plan of the Company of any Subsidiary, or (iii) suffers Constructive
Termination (as such term is defined in the Employment Agreement among Grantee,
the Company and certain of the Company's subsidiaries, entered into as of the
date of this Agreement), or (iv) the Term of such Employment Agreement ends
prior to March 1, 2004, or (v) Grantee's employment is terminated without cause.
3
4
4. TERMINATION OF RIGHTS AND FORFEITURE OF COMMON STOCK. Except for
Shares that have become nonforfeitable, all of the Shares will be forfeited if
the Grantee ceases to be employed by the Company or a Subsidiary at any time
prior to the fifth anniversary of the Grant Date, unless the Committee
determines to provide otherwise at the time of the cessation of the Grantee's
employment. All of the Non-Plan Shares will be forfeited on the 31st day after
the Grant Date, if Grantee fails to comply with Section 14. In the event of a
forfeiture, any certificate(s) representing the Shares will be canceled.
5. DIVIDEND, VOTING AND OTHER RIGHTS. (a) Except as otherwise provided
in this Agreement, the Grantee will have all of the rights of a stockholder with
respect to the Shares, including the right to vote the Shares 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 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 will be subject to the same
restrictions as the Shares.
(b) Cash dividends, if any, and any other distributions paid on the
Shares will be sequestered by the Company until such time as such Shares become
nonforfeitable in accordance with Section 3 and will, to the extent practicable,
be deemed to be reinvested (at the Stock Price on the dividend payment date) on
an immediate basis in additional shares of Common Stock from the Company's
treasury, which will be subject to the same restrictions as the underlying
Shares granted under this Agreement. If Shares are forfeited pursuant to Section
4, all dividends and other distributions, together with the earnings thereon,
with respect to such Shares will likewise be forfeited.
6. RETENTION OF STOCK CERTIFICATE(S) BY COMPANY. Any certificates
representing Shares will 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.
7. COMPLIANCE WITH LAW. The Company shall make reasonable efforts to
comply with all applicable federal, state and other applicable securities laws;
provided, however, notwithstanding any other provision of this Agreement, the
Company will not be obligated to issue any securities pursuant to this Agreement
if the issuance thereof would result in a violation of any such law. Grantee
acknowledges that Grantee is an executive officer of the Company, has complete
access to the Company's financial and other information, is fully capable of
making an investment decision concerning the Company's Common Stock without
assistance of third parties, and has no intention to distribute any of the
Shares to third parties.
8. WITHHOLDING TAXES. If the Company is required to withhold any
federal, state, local or foreign tax in connection with any issuance of
restricted or nonrestricted shares of Common Stock or other securities pursuant
to this Agreement, the Grantee shall pay the tax or make provisions that are
satisfactory to the Company for the payment thereof.
4
5
9. RIGHT TO TERMINATE EMPLOYMENT. No provision of this Agreement will
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.
10. RELATION TO OTHER BENEFITS. Any economic or other benefit to the
Grantee under this Agreement or the Plan shall not be taken into account in
determining any benefits to which the Grantee may be entitled under any
profit-sharing, retirement or other benefit or compensation plan maintained by
the Company or a Subsidiary and shall not affect the amount of any insurance
coverage available to any beneficiary under any insurance plan covering
employees of the Company or a Subsidiary.
11. 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 shall adversely affect the rights
of the Grantee with respect to the Shares or other securities covered by this
Agreement without the Grantee's consent.
12. SEVERABILITY. In the event that one or more of the provisions of
this Agreement are invalidated for any reason by a court of competent
jurisdiction, any provision so invalidated will be deemed to be separable from
the other provisions hereof, and the remaining provisions hereof will continue
to be valid and fully enforceable.
13. GOVERNING LAW. This Agreement is made under, and will be construed
in accordance with, the laws of the State of Ohio without regard to conflict of
law principles of such state.
14. TAXES. Grantee will make a proper election under Section 83(b) of
the Internal Revenue Code of 1986, as amended, no later than 30 days after the
date of this Agreement with respect to all of the Shares.
15. DEFINITIONS. As used in this Agreement, the following terms have
the following meanings:
"GRANT DATE" means the date of the Board or Committee action awarding
the Shares to the Grantee as indicated on the signature page of this Agreement.
"INITIAL PRICE" means $15.45.
"STOCK PRICE" means the closing price of the Common Stock on the
principal exchange on which the Common Stock is traded.
"SUBSIDIARY" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company if each of such
corporations (or a group of corporations that themselves are Subsidiaries) other
than the last corporation in the unbroken chain owns stock possessing fifty
percent or more of the total combined voting power of all classes of stock in
one of the other corporations in such chain.
5
6
"TRADING DAYS" means days on which the principal exchange on which the
Common Stock is traded is open for trading, regardless of whether actual trading
in the Common Stock occurs.
This Restricted Stock Agreement has been executed by the parties at
Cleveland, Ohio as of December 17, 1998.
XXXX NATIONAL CORPORATION
By: /s/ Xxxxxx X. Xxxx
--------------------------
Name: Xxxxxx X. Xxxx
Xxxxxx: Sr. Vice President
/s/ Xxxxxxx X. Xxxx
-------------------------------
Xxxxxxx X. Xxxx
