STONERIDGE, INC. AMENDED AND RESTATED LONG-TERM INCENTIVE PLAN
Exhibit
10.1
STONERIDGE,
INC.
AMENDED
AND RESTATED LONG-TERM INCENTIVE PLAN
2010
RESTRICTED SHARES GRANT AGREEMENT
Stoneridge,
Inc., an Ohio corporation (the “Company”), pursuant to the terms and conditions
hereof, hereby grants to _____________ (“Grantee”) XXX Common Shares, without
par value, of the Company (the “Restricted Shares”). As set forth
below, the grant of Restricted Shares is comprised of two separate mutually
exclusive parts, Award I and Award II.
1. The
Restricted Shares are in all respects subject to the terms, conditions and
provisions of this Agreement and the Company’s Amended and Restated Long-Term
Incentive Plan (the “Plan”).
2. Until
no longer subject to substantial risk of forfeiture in accordance with the
schedule and/or performance criteria set forth below, the Restricted Shares may
not be sold, transferred, pledged, assigned or otherwise encumbered, whether
voluntarily, involuntarily or by operation of law, and will be forfeited to the
Company if the Grantee’s employment with the Company is terminated prior to
February 14, 2013, except in the case of (i) retirement, (ii) death, (iii)
Permanent Disability, (iv) Change in Control or (v) termination without cause,
each as provided below. A certificate or certificates, which may be
in uncertificated form (electronic or book entry) at the Company’s discretion,
representing the Restricted Shares may bear a legend evidencing the restrictions
contained herein, as applicable.
If the
employment of the Grantee is not terminated prior to February 14, 2013, the
Restricted Shares shall, subject to satisfaction of the performance criteria
applicable to Award II, vest and be no longer subject to a substantial risk of
forfeiture on February 14, 2013.
Special Provisions
Applicable to Retirement.
Subject
to the conditions below, in the case of retirement the Restricted Shares
of:
(1) Award
I shall not be forfeited and will vest and no longer be subject to risk of
forfeiture on the date of retirement and a certificate or certificates
representing Award I Restricted Shares shall promptly be delivered to the
Grantee; and
(2) Award
II shall not be forfeited and will vest and no longer be subject to risk of
forfeiture upon performance criteria applicable to Award II, and a certificate
or certificates representing Award II Restricted Shares shall be delivered to
theGrantee as promptly as practical after completion of the Peer Group
Performance Period but in no event later than January 31, 2013.
Only a
Grantee who (i) is 63 or older at the time of retirement, (ii) has provided
written notice to the Compensation Committee of the Board of Directors (the
“Committee”) of the intent to retire at least one year prior to the retirement
date, and (iii) has executed prior to retirement a customary one year
non-competition agreement shall be permitted to vest Restricted Shares upon
retirement.
If the
employment of the Grantee is not terminated prior thereto the Restricted Shares
shall vest and will no longer be subject to a substantial risk of forfeiture in
the amounts and on the dates set forth below:
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Award
I
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Time-Based
Vesting
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|
Vesting Date
|
Number of Shares Vesting
|
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February
14, 2013
|
YYY
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Award
II
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Company
Performance Versus Peer Group Performance and Time-Based
Vesting
|
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Vesting Date
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Maximum Number of Shares that May
Vest
|
|
|
February
14, 2013
|
ZZZ
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If the
Company’s total shareholder return (as defined below) for the Company’s fiscal
years 2010, 2011 and 2012 (the “Peer Group Performance Period”) is equal to or
greater than the 75th
percentile of the Peer Group’s performance (also measured as total shareholder
return for the Peer Group Performance Period), then all ZZZ Restricted Shares
shall vest.
If the
Company’s total shareholder return for the Peer Group Performance Period is less
than the 25th percentile of the Peer Group’s performance, then all ZZZ
Restricted Shares shall be forfeited.
If the
Company’s total shareholder return for the Peer Group Performance Period is
equal to the 25th
percentile of the Peer Group’s performance, then AAA Restricted Shares shall
vest and BBB Restricted Shares shall be forfeited.
If the
Company’s total shareholder return for the Peer Group Performance Period is
greater than the 25th
percentile of the Peer Group’s performance and less than the 50th
percentile of the Peer Group’s performance, then the number of Restricted Shares
that shall vest shall be AAA Restricted Shares plus the result of the following
calculation (rounded to the nearest whole share): AAA times (the Company’s
percentile in comparison to the Peer Group of the Company’s total shareholder
return during the Peer Group Performance Period (expressed as a decimal) less
..25) divided by .25.
If the
Company’s total shareholder return for the Peer Group Performance Period is
equal to the 50th
percentile of the Peer Group’s performance, then BBB Restricted Shares shall
vest and AAA Restricted Shares shall be forfeited.
If the
Company’s total shareholder return for the Peer Group Performance Period is
greater than the 50th
percentile of the Peer Group’s performance and less than the 75th
percentile of the Peer Group’s performance then the number of Restricted Shares
that shall vest shall be BBB Restricted Shares plus the result of the following
calculation (rounded to the nearest whole share): AAA times (the Company’s
percentile in comparison to the Peer Group of the Company’s total shareholder
return during the Peer Group Performance Period (expressed as a
decimal) less .5) divided by .25.
The Peer Goup companies are: ATC
Technology Corp, AVX, Commercial Vehicle Group, CTS, Xxxxxxxxx Technologies,
Gentex, Graco, Methode Electronics, Modine Manufacturing, Nu Horizons
Electronics, Shiloh Industries, Standard Motor Products, Superior Industries,
Technitrol, Xxxxxx & Xxxxx, and Titan International. The Peer
Group shall be subject to modification at the discretion of the Committee from
time to time, when events warrant.
Total shareholder return shall be
calculated by dividing: (i) the sum of (A) the cumulative amount of dividends
for the Peer Group Performance Period, and (B) the difference between a
company’s share price at the end of and the beginning of the Peer Group
Performance Period; by (ii) the shares price at the beginning of the Peer Group
Performance Period.
3. The
Restricted Shares will be issued in the name of the Grantee. The
Company’s transfer agent and/or share transfer records will show the Grantee as
the owner of record of the Restricted Shares. Except as otherwise
provided in this Agreement, the Grantee will have all the rights of a
shareholder of the Company, including the right to vote and receive
dividends.
2
4. The
Company or the Company’s agent will hold (either physical or uncertificated
form) the Restricted Shares for the period of time that the Restricted Shares
are subject to forfeiture and the certificate or certificates representing the
Restricted Shares will be delivered to the Grantee after the Restricted Shares
are no longer subject to substantial risk of forfeiture. Such
delivery may take the form of an electronic transfer of the vested Restricted
Shares to the Grantee’s brokerage or other financial account. The
Grantee shall execute and deliver to the Company a blank stock power so that the
Restricted Shares that may be forfeited can be canceled.
5. Notwithstanding
the foregoing, in addition to the vesting of the Restricted Shares set forth
above, the Restricted Shares shall no longer be subject to a substantial risk of
forfeiture and shall vest upon the occurrence a event described
below.
Award I
shall vest and not be forfeited in the event of:
(a) the
Grantee’s death or Permanent Disability (as defined in the Plan) in proportion
to the number of months, including any partial month, elapsed in the vesting
period divided by 36;
(b) a
Change in Control of the Company (as defined in the Plan); or
(c) the
termination “without cause” (defined below) of the Grantee’s employment by the
Company; provided, however only in proportion to the number of months, including
any partial month, elapsed in the vesting period divided by 36.
A certificate or certificates
representing the vested Restricted Shares under Award I shall be delivered to
the Grantee or the Grantee’s estate after the occurrence of an event described
above as soon as practical.
Awards II shall vest and not be
forfeited in the event of:
(a) the
Grantee’s death or Permanent Disability in proportion to the number of months,
including any partial month, elapsed in the vesting period divided by
36;
(b) a
Change in Control of the Company; or
(c) the
termination “without cause” of the Grantee’s employment by the Company;
provided, however only in proportion to the number of months, including any
partial month, elapsed in the vesting period divided by 36.
In the event of the Grantee’s death,
Permanent Disability or termination without cause Award II
shall vest in amounts (and subject to the pro rata provisions for death,
Permanent Disability and termination without cause) in accordance with the
Company’s total shareholder return during the Peer Group Performance Period as
determined under the metrics of Section 2 above. A certificate or
certificates representing the earned Restricted Shares under Award II shall be
delivered to the Grantee or the Grantee’s estate as promptly as practical after
completion of the Peer Group Performance Period but no in event later than
January 31, 2013. In the event of a Change in Control of the Company
Award II shall vest in amounts which assume the Company’s total shareholder
return during the Peer Group Performance Period is equal to the 50th
percentile of the Peer Group’s performance. A certificate or
certificates representing the earned Restricted Shares under Award II shall be
delivered to the Grantee as promptly as practical after the Change in
Control.
Termination shall be deemed to be
“without cause” unless the Board of Directors of the Company, or its designee,
in good faith determines that termination is because of any one or more of the
following, in which case such termination shall be deemed to be for
“cause”:
3
The
Grantee’s:
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(a)
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fraud;
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(b)
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misappropriation
of funds from the Company;
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(c)
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commission
of a felony or of an act or series of acts which result in material injury
to the business reputation of the
Company;
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(d)
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commission
of a crime or act or series of acts involving moral
turpitude;
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(e)
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commission
of an act or series of repeated acts of dishonesty that are materially
inimical to the best interests of the
Company;
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(f)
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willful
and repeated failure to perform his duties, which failure has not been
cured within fifteen (15) days after the Company gives notice thereof to
the Grantee;
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(g)
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material
breach of any material provision of an employment agreement, if any, which
breach has not been cured in all substantial respects within ten (10) days
after the Company gives notice thereof to the Grantee;
or
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(h)
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failure
to carry out the reasonable directions or instructions of the Grantee’s
superiors, provided the directions or instructions are consistent with the
duties of the Grantee’s office, which failure has not been cured in all
substantial respects within ten (10) days after the Company gives notice
thereof to the Grantee.
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Provided, however, the Company’s
obligation to provide notice and an opportunity to cure, pursuant to subsections
5(f)-(h) above, shall only apply to the Grantee’s first breach, first failure to
perform or first failure to follow directions, as the case may be, of the nature
giving rise to the right of the Company to provide notice thereof. In
addition, the Grantee may terminate his employment with the Company, and such
termination shall be deemed a termination by the Company “without cause”
if:
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(a)
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the
Company reduces the Grantee’s title, responsibilities, power or authority
in comparison with his title, responsibilities, power or authority on the
date hereof;
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(b)
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the
Company assigns the Grantee duties which are inconsistent with the duties
assigned to the Grantee on the date hereof and which duties the Company
persists in assigning to the Grantee despite the prior written objection
of the Grantee; or
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(c)
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the
Company reduces the Grantee’s annual base compensation (unless such
decrease is proportionate with a decrease in the base compensation of the
officers of the Company as a group), or materially reduces his group
health, life, disability or other insurance programs, his pension,
retirement or profit-sharing benefits or any benefits provided by the
Company, or excludes him from any plan, program or arrangement, including
but not limited to bonus or incentive
plans.
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6. On
any change in the number or kind of outstanding common shares of the Company by
reason of a recapitalization, merger, consolidation, reorganization, separation,
liquidation, share split, share dividend, combination of shares or any other
change in the corporate structure or Common Shares of the Company, the Company,
by action of the Committee, is empowered to make such adjustment, if any, in the
number and kind of Restricted Shares subject to this Agreement as it considers
appropriate for the protection of the Company and of the Grantee.
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7. No
later than the date as of which an amount first becomes includable in the gross
income of the Grantee for federal income tax purposes with respect to the
Restricted Shares granted hereunder, the Grantee shall pay to the Company, or
make arrangements satisfactory to the Committee regarding the payment of, any
federal, state or local taxes of any kind required by law to be withheld with
respect to that amount. Unless otherwise determined by the Committee,
minimum statutory withholding obligations may be settled with previously owned
Common Shares or Restricted Shares that have vested. The making of
that payment or those arrangements is a condition to the obligations of the
Company under the Plan, and the Company and its subsidiaries and affiliates may,
to the extent permitted by law, deduct any taxes from any payment of any kind
otherwise payable to the Grantee.
8. Nothing
in this Agreement shall affect in any manner any conflicting or other provision
of any other agreement between the Grantee and the Company. Nothing
contained in this Agreement shall limit whatever right the Company might
otherwise have to terminate the employment of the Grantee.
9. The
laws of the State of Ohio govern this Agreement, the Plan and the Restricted
Shares granted hereby.
IN
WITNESS WHEREOF, the Company has caused its corporate name to be subscribed by
its duly authorized officer as of the 14th day of February 2010.
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STONERIDGE,
INC.
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By
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Xxxx
Xxxxx
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The
foregoing is hereby accepted.
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(Signature)
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