RESTRICTED STOCK AGREEMENT
Exhibit 10.4
THIS RESTRICTED STOCK AGREEMENT (this “Agreement”) is made as of the 20th day of June, 2008
(the “Date of Grant”), between Cardtronics, Inc., a Delaware corporation (the “Company”), and Xxxx
X. Xxxxxxxx (the “Employee”).
1. Award. Pursuant to the Cardtronics, Inc. 2007 Stock
Incentive Plan (the “Plan”), as of the Date of Grant, 120,000 shares (the “Restricted Shares”) of
the Company’s common stock, par value $0.0001 per share, shall be issued as hereinafter provided in
the Employee’s name subject to certain restrictions thereon. The Restricted Shares shall be issued
upon acceptance hereof by the Employee and upon satisfaction of the conditions of this Agreement.
The Employee acknowledges receipt of a copy of the Plan, and agrees that this award of Restricted
Shares shall be subject to all of the terms and provisions of the Plan, including future amendments
thereto, if any, pursuant to the terms thereof.
2. Definitions. Capitalized terms used in this Agreement that are not defined below
or in the body of this Agreement shall have the meanings given to them in the Plan. In addition to
the terms defined in the body of this Agreement, the following capitalized words and terms shall
have the meanings indicated below:
(a) “Change in Control” shall mean:
(i) a merger of the Company with another entity, a consolidation involving the Company,
or the sale of all or substantially all of the assets of the Company to another entity if,
in any such case, (1) the holders of equity securities of the Company immediately prior to
such transaction or event do not beneficially own immediately after such transaction or
event equity securities of the resulting entity entitled to 60% or more of the votes then
eligible to be cast in the election of directors generally (or comparable governing body) of
the resulting entity in substantially the same proportions that they owned the equity
securities of the Company immediately prior to such transaction or event or (2) the persons
who were members of the Board immediately prior to such transaction or event shall not
constitute at least a majority of the board of directors of the resulting entity immediately
after such transaction or event;
(ii) the dissolution or liquidation of the Company;
(iii) when any person or entity, including a “group” as contemplated by Section
13(d)(3) of the Exchange Act, acquires or gains ownership or control (including, without
limitation, power to vote) of more than 50% of the combined voting power of the outstanding
securities of the Company; or
(iv) as a result of or in connection with a contested election of directors, the
persons who were members of the Board immediately before such election shall cease to
constitute a majority of the Board.
For purposes of the preceding sentence, (1) “resulting entity” in the context of a transaction or
event that is a merger, consolidation or sale of all or substantially all assets shall mean the
surviving entity (or acquiring entity in the case of an asset sale) unless the surviving entity (or
acquiring entity in the case of an asset sale) is a subsidiary of another entity and the holders of
common stock of the Company receive capital stock of such other entity in such transaction or
event, in which event the resulting entity shall be such other entity, and (2) subsequent to the
consummation of a merger or consolidation that does not constitute a Change in Control, the term
“Company” shall refer to the resulting entity and the term “Board” shall refer to the board of
directors (or comparable governing body) of the resulting entity.
(b) “Disability” shall mean the Employee’s disability entitling the Employee to benefits under
the long-term disability plan maintained by the Company or an Affiliate; provided, however, that if
the Employee is not eligible to participate in such plan, then the Employee shall be considered to
have incurred a “Disability” if and when the Committee determines in its discretion that the
Employee is permanently and totally unable to perform his or her duties for the Company or any
Affiliate as a result of any medically determinable physical or mental impairment as supported by a
written medical opinion to the foregoing effect by a physician selected by the Committee.
(c) “Earned Shares” means the Restricted Shares after the lapse of the Forfeiture Restrictions
without forfeiture.
(d) “Forfeiture Restrictions” shall have the meaning specified in Section 3(a) hereof.
(e) “Good Reason” shall have the meaning assigned to such term (or any similar term) in the
Employee’s employment agreement with the Company or any Affiliate; provided, however, that if the
Employee does not have such an employment agreement or the Employee’s employment agreement does not
define the term “Good Reason” (or any similar term), then “Good Reason” shall mean the occurrence
of any of the following events:
(i) a material diminution in the Employee’s annual base salary; or
(ii) a material diminution in the Employee’s authority, duties, or responsibilities; or
(iii) the involuntary relocation of the geographic location of the Employee’s principal
place of employment by more than 75 miles from the location of the Employee’s principal
place of employment immediately prior to the Date of Grant.
Notwithstanding the preceding provisions of this Section 2(e), any assertion by the Employee of a
termination of employment for “Good Reason” shall not be effective for purposes of this Agreement
unless all of the following conditions are satisfied: (1) the condition described in Section
2(e)(i), (ii) or (iii) giving rise to the Employee’s termination of employment (or, if applicable,
the condition specified in the employment agreement defining “Good Reason” (or a similar term))
must have arisen without the Employee’s consent; (2) the Employee must provide written notice to
the Company of such condition in accordance with Section 8 within 45 days of the initial existence
of the condition; (3) the condition specified in such notice must remain uncorrected for 30 days
after receipt of such notice by the Company; and (4) the date of the Employee’s termination of
employment must occur within 90 days after the initial existence of the condition specified in such
notice.
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(f) “Involuntary Termination” shall mean any termination of the Employee’s employment with the
Company that:
(i) does not result from a resignation by the Employee (other than a resignation
pursuant to clause (ii) of this Section 2(f)); or
(ii) results from a resignation by the Employee for Good Reason;
provided, however, the term “Involuntary Termination” shall not include a Termination for Cause or
any termination as a result of death or Disability.
(g) “Termination for Cause” shall mean the termination of the Employee’s employment with the
Company by the Company for “cause” as such term (or any similar term) is defined in the Employee’s
employment agreement with the Company or any Affiliate; provided, however, that if the Employee
does not have such an employment agreement or the Employee’s employment agreement does not define
the term “cause” (or any similar term), then “Termination for Cause” shall mean the termination of
the Employee’s employment with the Company based on a determination by the Committee (or its
delegate) that the Employee (i) has engaged in gross negligence, gross incompetence or willful
misconduct in the performance of the Employee’s duties with respect to the Company or any
Affiliate, (ii) has refused without proper legal reason to perform the Employee’s duties and
responsibilities to the Company or any Affiliate, (iii) has materially breached any material
provision of a written agreement or corporate policy or code of conduct established by the Company
or any Affiliate, (iv) has willfully engaged in conduct that is materially injurious to the Company
or any Affiliate, (v) has disclosed without specific authorization from the Company confidential
information of the Company or any Affiliate that is materially injurious to any such entity, (vi)
has committed an act of theft, fraud, embezzlement, misappropriation or willful breach of a
fiduciary duty to the Company or any Affiliate, or (vii) has been convicted of (or pleaded no
contest to) a crime involving fraud, dishonesty or moral turpitude or any felony (or a crime of
similar import in a foreign jurisdiction).
3. Restricted Shares. The Employee hereby accepts the Restricted Shares when issued
and agrees with respect thereto as follows:
(a) Forfeiture Restrictions. The Restricted Shares may not be sold, assigned,
pledged, exchanged, hypothecated or otherwise transferred, encumbered or disposed of, and in the
event of termination of the Employee’s employment with the Company for any reason, the Employee
shall, for no consideration and except to the extent described in the second sentence of Section
3(b), forfeit to the Company all Restricted Shares. The prohibition against transfer and the
obligation to forfeit and surrender Restricted Shares to the Company upon termination of employment
as provided in the preceding sentence are herein referred to as the “Forfeiture Restrictions.” The
Forfeiture Restrictions shall be binding upon and enforceable against any transferee of Restricted
Shares.
(b) Lapse of Forfeiture Restrictions. Provided that the Employee has been
continuously employed by the Company from the Date of Grant through the lapse date set forth
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in the following schedule, the Forfeiture Restrictions shall lapse with respect to a percentage of
the Restricted Shares determined in accordance with the following schedule:
| Percentage of Total Number | ||||
| of Restricted Shares as to Which | ||||
| Lapse Date | Forfeiture Restrictions Lapse | |||
First Anniversary of the Date of Grant |
25 | % | ||
Second Anniversary of the Date of Grant |
25 | % | ||
Third anniversary of the Date of Grant |
25 | % | ||
Fourth anniversary of the Date of Grant |
25 | % | ||
Notwithstanding the above schedule, in the event the Employee dies or becomes Disabled during the
term of his employment, the percentage of the total number of shares as to which the Forfeiture
Restrictions shall lapse shall automatically increase by 25% of the shares awarded.
“Disabled” shall mean Employee being unable to perform Employee’s duties or fulfill Employee’s
obligations to the Company by reason of any medically determinable physical or mental impairment
that can be expected to result in death or can be expected to last for a continuous period of not
less than six months as determined by the Company and certified in writing by a competent medical
physician selected by the Company.
If a Change in Control occurs after the Date of Grant and on or before the date of the termination
of the Employee’s employment with the Company, then the Forfeiture Restrictions shall lapse with
respect to 50% of the Restricted Shares effective as of the date upon which the Change in Control
occurs. Further, if following such Change of Control the Employee is subsequently terminated and
such termination is an Involuntary Termination or a Good Reason Termination, all remaining
Forfeiture Restrictions shall lapse effective as of the date of such termination. Any shares with
respect to which the Forfeiture Restrictions do not lapse in accordance with the preceding
provisions of this Section 3(b) shall be forfeited to the Company for no consideration as of the
date of the termination of the Employee’s employment with the Company.
(c) Certificates. A certificate evidencing the Restricted Shares shall be issued by
the Company in the Employee’s name, pursuant to which the Employee shall have all of the rights of
a stockholder of the Company with respect to the Restricted Shares, including, without limitation,
voting rights and the right to receive dividends (provided, however, that dividends paid in shares
of the Company’s stock shall be subject to the Forfeiture Restrictions and further provided that
dividends that are paid other than in shares of the Company’s stock shall be paid no later than the
end of the calendar year in which the dividend for such class of stock is paid to stockholders of
such class or, if later, the 15th day of the third month following the date the dividend is paid to
stockholders of such class of stock). Notwithstanding the foregoing, the Company may, in its
discretion, elect to complete the delivery of the Restricted Shares by means of electronic,
book-entry statement, rather than issuing physical share certificates. The Employee may not sell,
transfer, pledge, exchange, hypothecate or otherwise dispose of the stock until the Forfeiture
Restrictions have expired, and a breach of the terms of this Agreement shall cause a forfeiture of
the Restricted Shares. The certificate, if any, shall be delivered upon
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issuance to the Secretary of the Company or to such other depository as may be designated by
the Committee as a depository for safekeeping until the forfeiture of such Restricted Shares occurs
or the Forfeiture Restrictions lapse pursuant to the terms of the Plan and this Agreement. At the
Company’s request, the Employee shall deliver to the Company a stock power, endorsed in blank,
relating to the Restricted Shares. Upon the lapse of the Forfeiture Restrictions without
forfeiture, the Company shall cause a new certificate or certificates to be issued without legend
(except for any legend required pursuant to applicable securities laws or any other agreement to
which the Employee is a party) in the name of the Employee in exchange for the certificate
evidencing the Restricted Shares or, as may be the case, the Company shall issue appropriate
instructions to the transfer agent if the electronic, book-entry method is utilized.
(d) Corporate Acts. The existence of the Restricted Shares shall not affect in any
way the right or power of the Board or the stockholders of the Company to make or authorize any
adjustment, recapitalization, reorganization or other change in the Company’s capital structure or
its business, any merger or consolidation of the Company, any issue of debt or equity securities,
the dissolution or liquidation of the Company or any sale, lease, exchange or other disposition of
all or any part of its assets or business or any other corporate act or proceeding. The
prohibitions of Section 3(a) hereof shall not apply to the transfer of Restricted Shares pursuant
to a plan of reorganization of the Company, but the stock, securities or other property received in
exchange therefor shall also become subject to the Forfeiture Restrictions and provisions governing
the lapsing of such Forfeiture Restrictions applicable to the original Restricted Shares for all
purposes of this Agreement, and the certificates, if any, representing such stock, securities or
other property shall be legended to show such restrictions.
4. Withholding of Tax. To the extent that the receipt of the Restricted Shares or the
lapse of any Forfeiture Restrictions results in compensation income or wages to the Employee for
federal, state or local tax purposes, the Employee shall deliver to the Company at the time of such
receipt or lapse, as the case may be, such amount of money as the Company may require to meet its
minimum obligation under applicable tax laws or regulations, and if the Employee fails to do so,
the Company is authorized to withhold from any cash or stock remuneration (including withholding
any Restricted Shares or Earned Shares distributable to the Employee under this Agreement) then or
thereafter payable to the Employee any tax required to be withheld by reason of such resulting
compensation income or wages. The Employee acknowledges and agrees that the Company is making no
representation or warranty as to the tax consequences to the Employee as a result of the receipt of
the Restricted Shares, the lapse of any Forfeiture Restrictions or the forfeiture of any Restricted
Shares pursuant to the Forfeiture Restrictions.
5. Status of Stock. The Employee agrees that the Restricted Shares and Earned Shares
issued under this Agreement will not be sold or otherwise disposed of in any manner which would
constitute a violation of any applicable federal or state securities laws. The Employee also
agrees that (a) the certificates, if any, representing the Restricted Shares and Earned Shares may
bear such legend or legends as the Committee deems appropriate in order to reflect the Forfeiture
Restrictions and to assure compliance with the terms and provisions of this Agreement and
applicable securities laws, (b) the Company may refuse to register the transfer of the Restricted
Shares or Earned Shares on the stock transfer records of the Company if such proposed transfer
would constitute a violation of the Forfeiture Restrictions or, in the opinion of counsel
satisfactory to the Company, of any applicable securities law, and (c) the Company may
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give related instructions to its transfer agent, if any, to stop registration of the transfer
of the Restricted Shares or Earned Shares.
6. Employment Relationship. For purposes of this Agreement, the Employee shall be
considered to be in the employment of the Company as long as the Employee remains an employee of
either the Company or an Affiliate. Without limiting the scope of the preceding sentence, it is
specifically provided that the Employee shall be considered to have terminated employment with the
Company at the time of the termination of the “Affiliate” status of the entity or other
organization that employs the Employee. Nothing in the adoption of the Plan, nor the award of the
Restricted Shares thereunder pursuant to this Agreement, shall confer upon the Employee the right
to continued employment by the Company or affect in any way the right of the Company to terminate
such employment at any time. Unless otherwise provided in a written employment agreement or by
applicable law, the Employee’s employment by the Company shall be on an at-will basis, and the
employment relationship may be terminated at any time by either the Employee or the Company for any
reason whatsoever, with or without cause or notice. Any question as to whether and when there has
been a termination of such employment, and the cause of such termination, shall be determined by
the Committee or its delegate, and its determination shall be final.
7. Conditions to Plan Participation and Receipt of Restricted Shares. In
consideration of the grant of the Restricted Shares, and in order to protect the interests of the
Company, its Affiliates, and their respective equity holders and employees, the Employee
acknowledges and agrees that it is a condition precedent to his or her right to participate in,
continue to participate in, and receive benefits under the Plan (including receipt of the
Restricted Shares) that (a) the Employee shall at all times comply with laws (whether domestic or
foreign) applicable to the Employee’s actions on behalf of the Company or any Affiliate, (b) the
Employee shall not commit any action that results in the Employee’s employment being subject to a
Termination for Cause, and (c) the Employee shall at all times fully and faithfully comply with all
material covenants and agreements set forth in this Agreement. By entering into this Agreement,
the parties hereto agree that the conditions to participation in the Plan set forth in this Section
are an essential component of the Plan and this Agreement, and it is their intent that such
conditions not be severed from the other terms and provisions of the Plan and this Agreement.
8. Notices. Any notices or other communications provided for in this Agreement shall
be sufficient if in writing. In the case of the Employee, such notices or communications shall be
effectively delivered if hand delivered to the Employee at the Employee’s principal place of
employment or if sent by registered or certified mail to the Employee at the last address the
Employee has filed with the Company. In the case of the Company, such notices or communications
shall be effectively delivered if sent by registered or certified mail to the Company at its
principal executive offices.
9. Entire Agreement; Amendment. This Agreement constitutes the entire agreement of
the parties with regard to the subject matter hereof, and contains all the covenants, promises,
representations, warranties and agreements between the parties with respect to the shares granted
hereby; provided, however, that the terms of this Agreement shall not modify and shall be subject
to the terms and conditions of any employment and/or severance agreement
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between the Company (or an Affiliate) and the Employee in effect as of the date a
determination is to be made under this Agreement. Without limiting the scope of the preceding
sentence, except as provided therein, all prior understandings and agreements, if any, among the
parties hereto relating to the subject matter hereof are hereby null and void and of no further
force and effect. This Agreement may not be modified in any respect by any verbal statement,
representation or agreement made by any employee, officer, or representative of the Company or by
any written agreement unless signed by an officer of the Company who is expressly authorized by the
Company to execute such document.
10. Binding Effect; Survival. This Agreement shall be binding upon and inure to the
benefit of any successors to the Company and all persons lawfully claiming under the Employee. The
provisions of Section 5 shall survive the lapse of the Forfeiture Restrictions without forfeiture.
11. Controlling Law. This Agreement shall be governed by, and construed in accordance
with, the laws of the State of Texas, without regard to conflicts of law principles thereof, or, if
applicable, the laws of the United States.
IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed by an officer
thereunto duly authorized, and the Employee has executed this Agreement, all as of the date first
above written.
| CARDTRONICS, INC. | ||||||
| By: | /s/ Xxxxxxx X. Xxxxxx | |||||
| Name: | Xxxxxxx X. Xxxxxx | |||||
| Title: | General Counsel and Secretary | |||||
| /s/ Xxxx X. Xxxxxxxx | ||||||
| XXXX X. XXXXXXXX | ||||||
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