Contract
Exhibit 10.8
2003 NON-EMPLOYEE DIRECTORS EQUITY PLAN
RESTRICTED STOCK AGREEMENT
RESTRICTED STOCK AGREEMENT
This Restricted Stock Agreement (the “Agreement”) is made as of
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(the “Grant Date”)
between KAYDON CORPORATION, a Delaware corporation (the “Company”), and (“Grantee”). Pursuant to
the Kaydon Corporation 2003 Non-Employee Directors Equity Plan (the “Plan”) the Grantee has been
granted shares of common stock of the Company, subject to the terms and conditions contained in
this Agreement and in the Plan. Capitalized terms not otherwise defined herein shall have the
meanings given to them in the Plan.
1. Grant of Restricted Stock. The Company grants to Grantee, and Grantee accepts,
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shares of $0.15 par value common stock of the Company, subject to the terms and conditions
of this Agreement (the “Restricted Stock”). Grantee acknowledges receipt of a copy of the
Prospectus for the Plan.
2. Restrictions on and Forfeiture of Restricted Stock. The Company awards the Restricted
Stock to Grantee subject to the restrictions described below.
(a) Unless the Compensation Committee (the “Committee”) of the Company’s Board of Directors
otherwise consents or the Plan otherwise explicitly provides, Grantee will not sell, exchange,
transfer, pledge, or otherwise dispose of any shares of the Restricted Stock at any time, whether
voluntarily or involuntarily, by operation of law or otherwise. If Grantee violates this
restriction, Grantee’s right to shares of Restricted Stock remaining subject to restrictions will
immediately cease and terminate and Grantee will immediately forfeit and surrender all shares of
Restricted Stock that are still subject to restrictions or which have not yet vested to the
Company. This restriction on transferability must lapse before Grantee will receive any stock
under this Agreement.
(b) Except as otherwise determined by the Committee, if the Grantee incurs a Termination of
Service other than by reason of death, Disability or Retirement, all shares of Restricted Stock
which are still subject to the foregoing restriction on transferability shall, upon such
Termination of Service, be forfeited and transferred back to the Company. In addition, if the
Grantee continues to hold Restricted Stock following his or her Termination of Service due to his
or her Retirement, the shares of Restricted Stock which remain subject to the foregoing restriction
on transferability shall nonetheless be forfeited and transferred back to the Company if the
Committee at any time thereafter determines that the Grantee has engaged in any activity
detrimental to the interests of the Company.
3. Lapse of Restrictions. The restrictions on transferability shall lapse with respect to all
shares of Restricted Stock on the January 5th following the Grant Date. The lapse of
restrictions on transferability shall also be accelerated as provided in Section 5.
4. Delivery of Shares. At the time all restrictions have lapsed with respect to shares of
Restricted Stock, the Company shall deliver the shares as to which such restrictions have lapsed as
follows:
(i) if an assignment to a trust has been made, to such trust; or
(ii) if the restriction on transferability has expired by reason of death and a beneficiary
has been designated in a form approved by the Company, to the beneficiary so designated; or
(iii) in all other cases, to the Grantee or the legal representative of the Grantee’s estate.
5. Acceleration of Lapsing Only Upon Death or Disability. Notwithstanding the provisions of
Section 3, if the Grantee incurs a Termination of Service due to death or Disability, or if the
Grantee
dies following a Termination of Service due to Retirement, then all restrictions in effect at
the date of such Termination of Service or at such date of death shall immediately lapse and all
shares shall be free of, and no longer subject to, any restrictions.
(a) Retirement. If the Grantee incurs a Termination of Service due to Retirement, any
restrictions on shares of Restricted Stock remaining at the time of Retirement shall continue in
effect and shall lapse as provided in Section 3.
6. Tax Withholding and Deferred Compensation. The Company shall have the right to require the
Grantee to make adequate provisions for any federal, state, local or foreign taxes (including, any
taxes arising under Sections 409A or 4999 of the Code, except to the extent otherwise specifically
provided in a written agreement with the Company), if any, required by law to be withheld by the
Company with respect to the income realized by such Grantee as a result of the lapsing of
restrictions with respect to shares of Restricted Stock. The Company shall have no obligation to
deliver shares of Stock that were previously Restricted Stock until the Company’s tax withholding
obligations have been satisfied. Neither the Company nor any of its employees, officers,
directors, or service providers shall have any obligation whatsoever to pay such taxes, to prevent
the Grantee from incurring them, or to mitigate or protect the Grantee from any such tax
liabilities. Nevertheless, if the Company reasonably determines that the Grantee’s receipt of
payments or benefits pursuant to Sections 5 and 7 of the Plan as a result of the Grantee’s
termination of membership on the Board constitutes “nonqualified deferred compensation” within the
meaning of Section 409A, payment of such amounts shall not commence until the Grantee incur a
“separation from service” within the meaning of Treasury Regulation § 1.409A-1(h) (“Separation from
Service”). If, at the time of the Grantee’s Separation from Service, the Grantee is a “specified
employee” (under Internal Revenue Code Section 409A), any amount that constitutes “nonqualified
deferred compensation” within the meaning of Code Section 409A that becomes payable to the Grantee
on account of the Grantee’s Separation from Service (including any amounts payable pursuant to the
preceding sentence) will not be paid until after the end of the sixth calendar month beginning
after the Grantee’s Separation from Service (the “409A Suspension Period”). Within 14 calendar days
after the end of the 409A Suspension Period, the Grantee shall be paid a lump sum payment in cash
equal to any payments delayed because of the preceding sentence, without interest. Thereafter, the
Grantee shall receive any remaining benefits as if there had not been an earlier delay.
7. Change in Control. In the event of a Change in Control, all restrictions relating to any
shares of Restricted Stock shall lapse and be of no further effect, as of the date thirty (30) days
prior to the date of the Change in Control. The lapsing of the restriction on transferability with
respect to shares of Restricted Stock that results solely by reason of this Section 7, shall be
conditioned upon the consummation of the Change in Control.
8. Issuance of Stock. The issuance or delivery of any shares of stock upon the lapsing of
restrictions on Restricted Stock may be postponed by the Company for any period required to comply
with any applicable requirements under the federal securities laws, any applicable listing
requirement of the NYSE or any other requirements of applicable laws or regulations. The Company
is not obligated to deliver or issue any shares of stock if such delivery or issuance would
constitute a violation of any provision of any law or regulation or any rule of the NYSE. So long
as the Company’s stock is listed on the NYSE, issuance of any shares of Restricted Stock, is
conditioned on such shares to be issued also being listed on the NYSE. In addition, if at any time
counsel to the Company is of the opinion that the sale or issuance of shares of Restricted Stock is
or may be unlawful under the circumstances, the Company shall have no obligation to make such sale
or issuance.
9. Rights as a Shareholder. Grantee will have certain rights as a shareholder with respect to
the Restricted Stock, including but not limited to the right to vote the Restricted Stock at
shareholders’ meetings, the right to receive, without restriction, all cash dividends paid with
respect to the Restricted Stock, and the right to participate with respect to the Restricted Stock
in any stock dividend, stock split, recapitalization, or other adjustment in the capital stock of
the Company, or any merger, consolidation, or other reorganization involving an increase, decrease,
or adjustment in the capital stock of the Company.
10. Substitute Shares. Any shares or other security received as a result of any stock
dividend, stock split, or reorganization will be subject to the same terms, conditions, and
restrictions as those relating to the Restricted Stock granted under this Agreement.
11. Registration. Certificates for the shares of stock evidencing the Restricted Stock will
not be issued but the shares will be registered in Grantee’s name in book entry form as soon as
administratively feasible after Grantee’s acceptance of this Agreement.
12. Governing Law. This Agreement shall be governed by and construed in accordance with the
laws of the State of Delaware.
13. Binding Effect and Amendment. This Agreement is the entire agreement between the parties
and will be binding upon, and will inure to the benefit of, the parties to this Agreement and their
respective heirs, successors, and assigns, and may be modified only by a writing signed by the
parties.
Executed this
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day of
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KAYDON CORPORATION | GRANTEE | |||||||
By: |
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Its: | Print Name: | |||||||