RESTRICTED STOCK AWARD AGREEMENT
Exhibit 10.12
THIS RESTRICTED STOCK AWARD AGREEMENT (this “Agreement”) is made as of the 6th day of March,
2008, between DYNEGY INC., a Delaware corporation (“Dynegy”), and all of its Affiliates
(collectively, the “Company”), and the named employee (the “Employee”). A copy of the Dynegy Inc.
2000 Long-Term Incentive Plan (the “Plan”) is annexed to this Agreement and shall be deemed a part
hereof as if fully set forth herein. Unless the context otherwise requires, all terms that are not
defined in this Agreement but which are defined in the Plan shall have the same meaning given to
them in the Plan when used herein.
1. Award. Pursuant to the Plan, as of the date of this Agreement (the “Grant Date”),
a designated number of restricted shares (the “Restricted Shares”) of Dynegy’s Class A common
stock, $0.01 par value per share (“Common Stock”), 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, and to all of the terms and conditions of this
Agreement. If it is subsequently determined by the Committee, in its sole discretion, that the
terms and conditions of this Agreement and/or the Plan are not compliant with Code Section 409A, or
any Treasury regulations or Internal Revenue Service guidance promulgated thereunder, this
Agreement and/or the Plan may be amended accordingly.
2. 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 otherwise disposed
of (any such sale, assignment, pledge, exchange, hypothecation or other transfer,
encumbrance or disposition being referred to herein as a “Transfer”) to the extent then
subject to the Forfeiture Restrictions (as hereinafter defined), and in the event of
termination of the Employee’s employment with the Company for any reason whatsoever, the
Employee shall, for no consideration, forfeit to the Company all Restricted Shares then
subject to the Forfeiture Restrictions, except to the extent that such Forfeiture
Restrictions lapse upon such termination in accordance with Section 2(b) hereof. The
prohibition against Transfer and the obligation to forfeit and surrender Restricted Shares
to the Company upon termination of employment are herein referred to as the “Forfeiture
Restrictions.” The Forfeiture Restrictions shall be binding upon and enforceable against
any transferee of Restricted Shares. For purposes of this Agreement, the following terms
shall have the meanings indicated below:
(i) “Base Salary” shall mean the regular base salary of Employee but
excluding all bonuses, expense reimbursements, benefits paid under any plan
maintained by the Company and all equity awards of any type.
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(ii) “Cause” shall mean, and hence arise where, as determined by the
Committee in its sole discretion, the Employee (A) has been convicted of a
misdemeanor involving moral turpitude or a felony; (B) has failed to
substantially perform the duties of such Employee to the Company (other than
such failure resulting from the Employee’s incapacity due to physical or
mental condition) which results in a materially adverse effect upon the
Company, financial or otherwise; (C) has refused without proper legal reason
to perform the Employee’s duties and responsibilities to the Company; or (D)
has breached any material corporate policy maintained and established by the
Company that is applicable to the Employee, provided such breach results in
a materially adverse effect upon the Company, financial or otherwise.
(iii) “Change in Control” shall mean the occurrence of any of the
following events: (A) a merger of Dynegy with another entity, a
consolidation involving Dynegy, or the sale of all or substantially all of
the assets or equity interests of Dynegy to another entity if, in any such
case, (I) the holders of equity securities of Dynegy immediately prior to
such event do not beneficially own immediately after such event equity
securities of the resulting entity entitled to fifty-one percent (51%) or
more of the votes then eligible to be cast in the election of directors (or
comparable governing body) of the resulting entity in substantially the same
proportions that they owned the equity securities of Dynegy immediately
prior to such event or (II) the persons who were members of the Board
immediately prior to such event do not constitute at least a majority of the
board of directors of the resulting entity immediately after such event; (B)
the dissolution or liquidation of Dynegy, but excluding a reorganization
pursuant to chapter 11 of Title 11, U.S. Code, as amended; (C) a
circumstance where 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 fifty percent
(50%) or more of the combined voting power of the outstanding securities of,
(I) if Dynegy has not engaged in a merger or consolidation, Dynegy, or (II)
if Dynegy has engaged in a merger or consolidation, the resulting entity;
(D) circumstances where, 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; or
(E) the Board (or the Committee) adopts a resolution declaring that a Change
in Control has occurred. For purposes of the “Change in Control”
definition, (1) “resulting entity” in the context of an event that is a
merger, consolidation or sale of all or substantially all of the subject
assets or equity interests shall mean the surviving entity (or acquiring
entity in the case of an asset or equity interest 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 Dynegy
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 “Dynegy” 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.
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(iv) “Change in Control Termination” shall mean Employee’s employment
is terminated by the Company (or a successor thereto) without Cause, or by
Employee following: (A) a significant diminution in Employee’s
responsibilities, authority or duties; (B) a material reduction in
Employee’s Base Salary; or (C) relocation of Employee’s principal place of
employment by 50 miles or more, all as determined by the Committee in its
sole discretion.
(v) “Committee” shall mean the committee that administers the Plan.
(vi) “Involuntary Termination” shall have the same meaning as specified
in the Dynegy Inc. Executive Severance Pay Plan (as amended and restated
effective January 1, 2008).
(b) Lapse of Forfeiture Restrictions. The Forfeiture Restrictions shall lapse
as to 100% of the Restricted Shares on the third anniversary of the Grant Date, provided
that the Employee has been continuously employed by the Company from the date of this
Agreement through such lapse date. Notwithstanding the foregoing:
(i) if the Employee is determined to be disabled (as defined in the
Company’s long term disability program or plan in which the Employee is a
participant or, if the Employee does not participate in any such plan, as
defined in the Dynegy Inc. Long Term Disability Plan, as amended, or the
successor plan thereto) or in the event of the death of the Employee, then
the Forfeiture Restrictions shall lapse with respect to 100% of the
Restricted Shares awarded to the Employee hereunder as of the date of such
determination or death, as applicable; and
(ii) if the Employee’s employment with the Company terminates by reason
of resignation by the Employee (except as otherwise provided in Section
2(b)(iv) or (v) below) or dismissal by the Company for Cause, then the
Employee shall immediately, for no consideration, forfeit to the Company all
Restricted Shares to the extent then subject to the Forfeiture Restrictions;
and
(iii) if the Employee’s employment with the Company terminates by
reason of retirement by the Employee following (A) the date on which such
Employee has reached sixty (60) years of age and (B) at
least ten (10) years of service as an employee of the Company, then the
Forfeiture Restrictions shall lapse as to 100% of the Restricted Shares
awarded to the Employee hereunder as of the date of such termination; and
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(iv) if the Employee’s employment with the Company terminates by reason
of Involuntary Termination, then the Forfeiture Restrictions shall lapse
with respect to 100% of the Restricted Shares awarded to the Employee
hereunder as of the date of such termination; and
(v) if the Employee’s employment with the Company terminates as a
result of a Change in Control Termination occurring in connection with, but
in no event earlier than sixty (60) days prior to, a Change in Control, then
the Forfeiture Restrictions shall lapse with respect to 100% of the
Restricted Shares awarded to the Employee hereunder as of the date of such
Change in Control; and
(vi) if the Employee is employed by the Company (or a successor
thereto) on the date of a Change in Control, then the Forfeiture
Restrictions shall lapse with respect to 100% of the Restricted Shares
awarded to the Employee hereunder as of the date of such Change in Control.
Any shares with respect to which the Forfeiture Restrictions do not lapse in accordance with
the preceding provisions of this Section 2(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) Shareholder Rights & Certificates. The Employee shall have all of the
rights of a shareholder 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), but the Employee may not Transfer the Restricted Shares until the Forfeiture
Restrictions have expired, and a breach of the terms of this Agreement or the Plan shall
cause a forfeiture of the Restricted Shares. Any certificate issued by the Company
evidencing the Restricted Shares shall bear appropriate legends in accordance with Section 4
below and shall be delivered upon 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 award. In the event a certificate evidencing the Employee’s
Restricted Shares is issued by the Company prior to the lapse of the Forfeiture
Restrictions, the Employee shall promptly 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, promptly following receipt of a written request from
the Employee, cause a certificate or certificates evidencing the shares of Common Stock
awarded to the Employee hereunder (and with respect to which the Forfeiture Restrictions
have lapsed) 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, if any, evidencing the Restricted Shares.
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(d) Corporate Acts. The existence of the Restricted Shares shall not affect in
any way the right or power of the Board of Directors of the Company or the shareholders 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 2(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 therefore 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.
3. Withholding of Tax. To the extent that the receipt of the Restricted Shares or the
lapse of any Forfeiture Restrictions results in compensation income to the Employee for federal or
state income 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 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 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.
4. Status of Stock. The Employee agrees that the Restricted 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) in
the event a certificate representing the Restricted Shares is issued, such certificate may bear
such legend or legends as the Committee deems appropriate in order to reflect the Forfeiture
Restrictions and to assure compliance with applicable securities laws, (b) the Company may refuse
to register the Transfer of the Restricted 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 give related instructions to its transfer agent, if any, to stop registration of the
Transfer of the Restricted Shares.
5. 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 (as such term is defined in the Plan). Nothing in the adoption
of the Plan or 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. 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, and its
determination shall be final.
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6. 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 when hand delivered to the Employee at his or her principal place of
employment or when 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 when sent by registered or certified mail to the Company at its
principal executive offices.
7. Entire Agreement; Amendment. This Agreement replaces and merges all previous
agreements and discussions relating to the same or similar subject matters between the Employee and
the Company and constitutes the entire agreement between the Employee and the Company with respect
to the subject matter of this Agreement. 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.
8. Binding Effect. 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.
9. Miscellaneous. In the event of any conflict or inconsistency between the terms of
this Agreement and the terms of the Plan, the terms of the Plan shall be controlling. In the event
of any conflict or inconsistency between the terms of this Agreement and the terms of the Dynegy
Inc. Executive Severance Pay Plan, including any amendments or supplements thereto, the terms of
this Agreement shall be controlling.
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IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed by an officer
thereunto duly authorized, and the Employee has agreed to and accepted the terms of this
Agreement*, all as of the date first above written.
| DYNEGY INC. | ||||||
| By: | /s/ J. Xxxxx Xxxxxxxx | |||||
| Name: J. Xxxxx Xxxxxxxx | ||||||
| Title: General Counsel & EVP, Administration | ||||||
| * | Employee has agreed to and accepted the terms of this Agreement utilizing online grant acceptance
capabilities with E*Trade Financial, the Company’s restricted stock administrator. |
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