Exhibit 10.6
XXXX X. XXXXXXX COMPANY
RESTRICTED STOCK AGREEMENT
This Restricted Stock Agreement evidences the grant by Xxxx X. Xxxxxxx
Company, a Georgia corporation (the "Company"), of shares of restricted stock to
Xxxxxxx X. Xxxx ("Executive"), subject to all of the specific terms and
conditions set forth in this agreement and the Xxxx X. Xxxxxxx Company 2002
Stock Option Plan (the "Plan").
Specific Terms and Conditions
Section 1. Grant Date. The grant date is April 26, 2002 (the "Grant
Date").
Section 2. Total Number of Shares. The total number of shares of
restricted par value of $1.00 Common Stock of Xxxx X. Xxxxxxx Company (the
"restricted stock") subject to the grant is 50,000 shares.
Section 3. Dividends and Voting. Executive shall have all shareholder
voting rights and rights to dividends paid in cash with respect to the shares of
stock subject to the grant. The Company shall retain any dividends paid in
stock, subject to vesting pursuant to this agreement of the corresponding
restricted stock.
Section 4. Holding and Transfer of Stock Certificate. The Company shall
issue the shares of restricted stock in the name of Executive; however, the
Company shall hold the shares until Executive vests in the shares or until the
shares are forfeited as described in Section 5. If Executive vests in shares of
the restricted stock, the Company shall transfer physical custody of vested
shares to Executive free of any forfeiture restrictions on such date or on the
next business date if the Executive vests on a date that is not a business
date. Any shares that are forfeited automatically shall revert back to the
Company. Executive shall have no right to transfer or otherwise alienate or
assign his interest in any shares of the restricted stock, except through the
laws of descent and distribution, before Executive vests in the shares and
physical custody of the shares is transferred to Executive.
Section 5. Vesting and Forfeiture.
(a) General Rule. Executive's right to the shares of restricted stock
shall remain subject to forfeiture until Executive vests in the shares
in accordance with thisss.5. Executive shall vest in the shares of
restricted stock, and such shares shall no longer be subject to
forfeiture, as follows, so long as Executive remains employed by the
Company (and subject to potential accelerated vesting in accordance
with Section 5(b), (c) or (d) below): 25% of the shares will vest on
December 15, 2002, an additional 25% of the shares will vest on
December 15, 2003, an additional 25% of the shares will vest on
December 15, 2004, and the remaining 25% of the shares will vest on
December 15, 2005. Executive shall completely forfeit his entire
interest in any shares of restricted stock that have not yet
previously vested (and shall receive no consideration from the
Company on account of such forfeiture) upon termination of Executive's
employment other than (1)due to death or disability, as defined by the
Company's long term disability program, (2) by the Company without
Good Cause (as defined below) or (3) as otherwise provided in Section
5(e).
(b) Death or Disability. Executive shall vest completely in the shares of
restricted stock, and such shares shall no longer be subject to
forfeiture, upon Executive's termination of employment due to death or
disability, as defined by the Company's long term disability program.
(c) Company Performance. Executive shall vest completely in the shares of
restricted stock, and such shares shall no longer be subject to
forfeiture, if the Company's stock market performance (measured by the
percentage increase in value of its Common Stock during the calendar
year) in two of any three consecutive calendar years after the Grant
Date (including the calendar year 2002) exceeds the return on the S&P
500 Index.
(d) Change in Control. Except as otherwise provided in thisss.5(d), in the
event of a Change in Control of the Company (as defined below),
Executive shall vest completely in any shares of restricted stock not
previously vested. Notwithstanding the foregoing, if the Company
determines that, as a result of a Change in Control, any cash
compensation, benefits, acceleration of vesting of stock options or
restricted stock, or other payments in the nature of compensation
(within the meaning of Section 280G of the Internal Revenue Code of
1986, as amended ("Code")) to (or for the benefit of Executive
provided under the terms of this Agreement or otherwise (collectively,
such cash compensation, benefits, acceleration and other payments are
referred herein as the "Payments") would constitute parachute payments
(within the meaning of Section 280G of the Code) that would cause
Executive to incur an excise tax under Section 4999 of the Code or the
Company to lose a tax deduction under Section 280G of the Code for any
Payments, such Payments shall be reduced to the extent the Company
deems necessary so that the Executive is not subject to an excise tax
under Section 4999 of the Code and the Company does not lose a tax
deduction under Section 280Gof the Code for any Payments. The Company
shall reduce Payments in the following order: (1) by reducing the
number of stock options that become vested upon a Change in Control
(in reverse order of price, with the highest priced options first
becoming unvested), (2) by reducing the number of shares of
restricted stock that become vested upon a Change in Control, and
(3) by reducing cash compensation. In the event that any shares of
restricted stock covered by this Agreement are not vested by reason of
the reduction in Payments pursuant to this Section.5(d), such shares
will nevertheless continue to vest in accordance with the provisions of
Section 5(a), (b) and (c) hereof. The Company (at the Company's
expense) shall use a public accounting firm reasonably acceptable to
Executive to make calculations necessary for determining any such
reduction of Payments and to certify to Executive that the remaining
Payments will not cause Executive to incur an excise tax under Section
4999 of the Code and to prepare Executive's federal income tax return
for the year of the Change in Control.
(e) Termination Without Good Cause. Executive shall vest completely in the
shares of restricted stock, and such shares shall no longer be subject
to forfeiture, if (1) the Company terminates Executive's employment
without Good Cause, or (2) Executive's employment with the Company
terminates as a consequence of an event described in Section3.1(b) of
the Noncompetition Agreement (as defined below).
(f) Definitions.
(1) A "Change in Control" for purposes of this agreement shall
be deemed to occur (A) upon the sale by the Company of all or
substantially all of its assets, the consolidation of the Company with
another person, or the merger of the Company with any person as a
result of which merger the Company is not the surviving entity, (B) if
Beneficial Ownership of 30% of more of the Common Stock of the Company
is held by any person or entity, or (C) in the event that a "Triggering
Event" (as defined therein) shall have occurred under the Company's
Share Purchase Rights Plan currently in effect or any successor plan.
"Beneficial Ownership" shall have the meaning provided in Rule 13d-3
under Securities Exchange Act of 1934.
(2) "Good Cause" shall mean (A) the Executive's
embezzlement of funds, commission of fraud against the Company, or
gross negligence or willful misconduct in the performance of his
duties; (B) the failure of Executive to devote substantially all of his
full working time to the fulfillment of his duties with the Company;
(C) Executive's conviction of, guilty plea to, or confession of a
felony or any act of fraud or any other act of moral turpitude; or (D)
Executive's engaging in conduct or activities materially damaging to
the property, business of reputation of the Company; provided, however,
that no conduct, action or decision made or taken by Executive in good
faith consistent with the business judgment rule shall provide a basis
for termination for Good Cause.
(3) "Noncompetition Agreement" shall mean the Noncompete and
Termination Agreement dated as of January 1, 2002, between the
Company and Executive.
Section 6. Securities Registration. Executive agrees that, if the
shares of restricted stock are not registered under the Securities Act of 1933
("1933 Act") or any applicable state securities law at the time of vesting,
Executive will execute a written representation to the Company, in form and
substance satisfactory to the Company, that such shares are being acquired only
for investment purposes and not with a view to, or for resale in connection
with, the distribution thereof. In such case the certificate representing such
shares may bear a legend to the effect that there has been no such registration
and that such shares may not be transferred, sold or offered for resale in the
absence of such registration or delivery to the Company of an opinion of legal
counsel that such registration is not required. In addition, if Executive is an
"affiliate" of the Company at the time of any proposed sale, Executive shall not
sell or otherwise transfer such shares in the absence of an effective
registration statement under the 1933 Act or such state law or the availability
of an exemption from such registration.
Section 7. Other Laws. The Company shall have the right to refuse to
issue or transfer any stock pursuant to this agreement if the Company acting in
its absolute discretion determines that the issuance or transfer of such stock
might violate any applicable law or regulation.
Section 8. Sale or Merger. Notwithstanding any other provision of this
agreement, if the Company agrees to sell all or substantially all of its assets
for cash or property or for a combination of cash and property or agrees to any
merger, consolidation, reorganization, share exchange, division or other
corporate transaction in which stock is converted into another security or into
the right to receive securities or property, the Company's Board of Directors
(the "Board") may in its sole discretion vest some or all of the shares of
restricted stock not previously vested.
Section 9. Employment and Termination. Nothing in this agreement shall
give the Executive the right to continue in employment by the Company or
adversely affect the right of the Company to terminate Executive's employment
with or without cause at any time.
Section 10. Binding Effect. This agreement shall be binding upon the
Company and Executive and their respective heirs, executors, administrators and
successors.
Section 11. Interpretation. The Board, or its delegate, shall have the
power to interpret this agreement. The interpretation of any provision of this
agreement by the Board shall be final and binding on all persons.
Section 12. Governing Law. This agreement shall be governed by laws
of the State of Georgia.
Section 13. Headings. The headings contained in this agreement are
for reference purposes only and shall not affect in anyway the meaning or
interpretation of this agreement.
Section 14. Sections. All references to sections (ss.) in this
agreement shall be to sections (ss.) of this agreement unless otherwise
expressly indicated in this agreement.
Section 15. Entire Agreement. This agreement (which is subject to all
of the specific terms and conditions set forth in the Plan) is intended by the
parties hereto to be the final expression of their agreement with respect to the
subject matter hereof and is the complete and exclusive statement thereof
notwithstanding any prior representation or statements to the contrary. This
agreement may be modified only by written instrument signed by each of the
parties hereto.
Section 16. Counterparts. This agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have executed this Restricted Stock
Agreement.
XXXX X. XXXXXXX COMPANY
By:_______________________________
Title: Vice President and General Counsel
Date: April 30, 2002
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Xxxxxxx X. Xxxx
Date: April 30, 2002
