EXHIBIT 10.3
CKE RESTAURANTS, INC.
RESTRICTED STOCK AWARD AGREEMENT
UNDER
2005 OMNIBUS INCENTIVE COMPENSATION PLAN
THIS RESTRICTED STOCK AWARD AGREEMENT (the "Agreement") is entered into as
of ___________, 200_ by and between ______________________ (hereinafter referred
to as "Purchaser") and CKE Restaurants, Inc., a Delaware corporation
(hereinafter referred to as the "Company"), pursuant to the Company's 2005
Omnibus Incentive Compensation Plan (the "Plan"). Any capitalized term not
defined herein shall have the same meaning ascribed to it in the Plan.
R E C I T A L S:
A. Purchaser is an employee or director, and in connection
therewith has rendered services for and on behalf of the Company or its
Affiliates.
B. The Company desires to issue shares of common stock to Purchaser for
the consideration set forth herein to provide an incentive for Purchaser to
remain a Service Provider of the Company and to exert added effort towards its
growth and success.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter set
forth, and for other good and valuable consideration, the parties agree as
follows:
1. ISSUANCE OF SHARES. The Company hereby offers to issue to
Purchaser an aggregate of _____________ (_____) shares of Common Stock of the
Company (the "Shares") on the terms and conditions herein set forth. Unless this
offer is earlier revoked in writing by the Company, Purchaser shall have ten
(10) days from the date of the delivery of this Agreement to Purchaser to accept
the offer of the Company by executing and delivering to the Company two copies
of this Agreement, without condition or reservation of any kind whatsoever,
together with the consideration to be delivered by Purchaser pursuant to Section
2 below, if applicable.
2. CONSIDERATION. The purchase price for the Shares shall be zero
($0.00).
3. VESTING OF SHARES.
(A) Subject to Section 3(b) below, the Shares acquired
hereunder shall vest and become "Vested Shares" as to thirty-three and one-third
percent (33.33%) of the Shares on the first anniversary of the effective date of
this Agreement, and thereafter, thirty-three and one-third percent (33.33%) of
the Shares shall become Vested Shares on each subsequent anniversary date of
this Agreement, such that 100% of the Shares shall be Vested Shares on the third
anniversary of this Agreement. Shares which have not yet become vested are
herein called "Unvested Shares." No additional shares shall vest after the date
of termination of Purchaser's "Continuous Service" (as defined below).
As used herein, the term "Continuous Service" means (i) employment by
either the Company or any parent or subsidiary corporation of the Company, or by
any successor entity following a Change in Control, which is uninterrupted
except for vacations, illness (except for permanent disability, as defined in
Section 22(e)(3) of the Code), or leaves of absence which are approved in
writing by the Company or any of such other employer corporations, if
applicable, or (ii) service as a
member of the Board of Directors of the Company until Purchaser resigns, is
removed from office, or Purchaser's term of office expires and he or she is not
reelected.
(B) Notwithstanding Section 3(a), if Purchaser holds Shares at
the time a Change in Control occurs, all Repurchase Rights shall automatically
terminate effective immediately prior to the occurrence of a Triggering Event
(as defined below) occurring within the twelve (12) month period beginning with
such Change in Control.
(C) For purposes of this Section 3, the following terms shall
have the meanings set forth below:
(I) "Triggering Event" shall mean (i) the termination of
Continuous Service of Purchaser by the Company or an Affiliate (or any successor
thereof) other than on account of death, Disability or Cause, (ii) the
occurrence of a Constructive Termination or (iii) any failure by the Company (or
a successor entity) to assume, replace, convert or otherwise continue this
Agreement in connection with the Change in Control (or another corporate
transaction or other change effecting the Common Stock) on the same terms and
conditions as applied immediately prior to such transaction, except for
equitable adjustments to reflect changes in the Common Stock pursuant to Section
6 hereof and Section 4.3 of the Plan.
(II) "Cause" shall mean a determination by the Committee
that Purchaser (i) has been convicted of, or entered a plea of nolo contendere
to, a crime that constitutes a felony under Federal or state law, (ii) has
engaged in willful gross misconduct in the performance of the Purchaser's duties
to the Company or an Affiliate or (iii) has committed a material breach of any
written agreement with the Company or any Affiliate with respect to
confidentiality, noncompetition, nonsolicitation or similar restrictive
covenant. In the event that the Purchaser is a party to an employment agreement
with the Company or any Affiliate that defines a termination on account of
"Cause" (or a term having similar meaning), such definition shall apply as the
definition of a termination on account of "Cause" for purposes hereof, but only
to the extent that such definition provides the Purchaser with greater rights. A
termination on account of Cause shall be communicated by written notice to the
Purchaser, and shall be deemed to occur on the date such notice is delivered to
the Purchaser.
(III) "Constructive Termination" shall mean a
termination of employment by Purchaser within sixty (60) days following the
occurrence of any one or more of the following events without the Purchaser's
written consent (i) any reduction in position, title (for Vice Presidents or
above), overall responsibilities, level of authority, level of reporting (for
Vice Presidents or above), base compensation, annual incentive compensation
opportunity, aggregate employee benefits or (ii) a request that Purchaser's
location of employment be relocated by more than fifty (50) miles. In the event
that the Purchaser is a party to an employment agreement with the Company or any
Affiliate (or a successor entity) that defines a termination on account of
"Constructive Termination," "Good Reason" or "Breach of Agreement" (or a term
having a similar meaning), such definition shall apply as the definition of
"Constructive Termination" for purposes hereof in lieu of the foregoing, but
only to the extent that such definition provides the Purchaser with greater
rights. A Constructive Termination shall be communicated by written notice to
the Committee, and shall be deemed to occur on the date such notice is delivered
to the Committee, unless the circumstances giving rise to the Constructive
Termination are cured within five (5) days of such notice.
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4. RECONVEYANCE UPON TERMINATION OF SERVICE.
(A) REPURCHASE RIGHT. The Company shall have the right (but
not the obligation) to repurchase all or any part of the Unvested Shares (the
"Repurchase Right") in the event that the Purchaser's Continuous Service
terminates for any reason. Upon exercise of the Repurchase Right, the Purchaser
shall be obligated to sell his or her Unvested Shares to the Company, as
provided in this Section 4. If the Purchase Price is zero, then upon termination
of Continuous Service Purchaser shall be obligated to transfer his or her
Unvested Shares to the Company for no additional consideration.
(B) CONSIDERATION FOR REPURCHASE RIGHT. The repurchase price
of the Unvested Shares (the "Repurchase Price") shall be equal to the Purchase
Price, if any, of such Unvested Shares.
(C) PROCEDURE FOR EXERCISE OF RECONVEYANCE OPTION. For sixty
(60) days after the Termination Date or other event described in this Section 4,
the Company may exercise the Repurchase Right by giving Purchaser and/or any
other person obligated to sell written notice of the number of Unvested Shares
which the Company desires to purchase. The Repurchase Price for the Unvested
Shares shall be payable, at the option of the Company, by check or by
cancellation of all or a portion of any outstanding indebtedness of Purchaser to
the Company, or by any combination thereof.
(D) NOTIFICATION AND SETTLEMENT. In the event that the Company
has elected to exercise the Repurchase Right as to part or all of the Unvested
Shares within the period described above, Purchaser or such other person shall
deliver to the Company certificate(s) representing the Unvested Shares to be
acquired by the Company within thirty (30) days following the date of the notice
from the Company. The Company shall deliver to Purchaser against delivery of the
Unvested Shares, checks of the Company payable to Purchaser and/or any other
person obligated to transfer the Unvested Shares in the aggregate amount of the
Repurchase Price, if any, to be paid as set forth in paragraph 4(b) above.
(E) DEPOSIT OF UNVESTED SHARES. Purchaser shall deposit with
the Company certificates representing the Unvested Shares, together with a duly
executed stock assignment separate from certificate in blank, which shall be
held by the Secretary of the Company. Purchaser shall be entitled to vote and to
receive dividends and distributions on all such deposited Unvested Shares.
(F) TERMINATION. The provisions of this Section 4 shall
automatically terminate in accordance with Section 3(b) above.
(G) ASSIGNMENT. The Company may assign its Repurchase Right
under this Section 4 without the consent of the Purchaser.
5. RESTRICTIONS ON UNVESTED SHARES. Unvested Shares may not be sold,
transferred, pledged, or otherwise disposed of, except that such Unvested Shares
may be transferred to a trust established for the sole benefit of the Purchaser
and/or his or her spouse, children or grandchildren. Any Unvested Shares that
are transferred as provided herein remain subject to the terms and conditions of
this Agreement.
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6. ADJUSTMENTS UPON CHANGES IN CAPITAL STRUCTURE. In the event that
the outstanding Shares of Common Stock of the Company are hereafter increased or
decreased or changed into or exchanged for a different number or kind of shares
or other securities of the Company by reason of a recapitalization, stock split,
combination of shares, reclassification, stock dividend, or other change in the
capital structure of the Company, then Purchaser shall be entitled to new or
additional or different shares of stock or securities, in order to preserve, as
nearly as practical, but not to increase, the benefits of Purchaser under this
Agreement, in accordance with the provisions of Section 4.3 of the Plan. Such
new, additional or different shares shall be deemed "Shares" for purposes of
this Agreement and subject to all of the terms and conditions hereof.
7. SHARES FREE AND CLEAR. All Shares purchased by the Company (or
otherwise returned to the Company) pursuant to this Agreement shall be delivered
by Purchaser free and clear of all claims, liens and encumbrances of every
nature (except the provisions of this Agreement and any conditions concerning
the Shares relating to compliance with applicable federal or state securities
laws), and the purchaser thereof shall acquire full and complete title and right
to all of such Shares, free and clear of any claims, liens and encumbrances of
every nature (again, except for the provisions of this Agreement and such
securities laws).
8. LIMITATION OF COMPANY'S LIABILITY FOR NONISSUANCE; UNPERMITTED
TRANSFERS.
(A) The Company agrees to use its reasonable best efforts to
obtain from any applicable regulatory agency such authority or approval as may
be required in order to issue and sell the Shares to Purchaser pursuant to this
Agreement. The inability of the Company to obtain, from any such regulatory
agency, authority or approval deemed by the Company's counsel to be necessary
for the lawful issuance and sale of the Shares hereunder and under the Plan
shall relieve the Company of any liability in respect of the nonissuance or sale
of such Shares as to which such requisite authority or approval shall not have
been obtained.
(B) The Company shall not be required to: (i) transfer on its
books any Shares of the Company which shall have been sold or transferred in
violation of any of the provisions set forth in this Agreement, or (ii) treat as
owner of such shares or to accord the right to vote as such owner or to pay
dividends to any transferee to whom such shares shall have been so transferred.
9. NOTICES. Any notice, demand or request required or permitted to
be given under this Agreement shall be in writing and shall be deemed given when
delivered personally or three (3) days after being deposited in the United
States mail, as certified or registered mail, with postage prepaid, (or by such
other method as the Administrator may from time to time deem appropriate), and
addressed, if to the Company, at its principal place of business, Attention: the
Chief Financial Officer, and if to the Purchaser, at his or her most recent
address as shown in the employment or stock records of the Company.
10. BINDING OBLIGATIONS. All covenants and agreements herein
contained by or on behalf of any of the parties hereto shall bind and inure to
the benefit of the parties hereto and their permitted successors and assigns.
11. CAPTIONS AND SECTION HEADINGS. Captions and section headings
used herein are for convenience only, and are not part of this Agreement and
shall not be used in construing it.
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12. AMENDMENT. This Agreement may not be amended, waived,
discharged, or terminated other than by written agreement of the parties.
13. ENTIRE AGREEMENT. This Agreement and the Plan constitute the
entire agreement between the parties with respect to the subject matter hereof
and supersede all prior or contemporaneous written or oral agreements and
understandings of the parties, either express or implied.
14. ASSIGNMENT. Purchaser shall have no right, without the prior
written consent of the Company, to (i) sell, assign, mortgage, pledge or
otherwise transfer any interest or right created hereby, or (ii) delegate his or
her duties or obligations under this Agreement. This Agreement is made solely
for the benefit of the parties hereto, and no other person, partnership,
association or corporation shall acquire or have any right under or by virtue of
this Agreement.
15. SEVERABILITY. Should any provision or portion of this Agreement
be held to be unenforceable or invalid for any reason, the remaining provisions
and portions of this Agreement shall be unaffected by such holding.
16. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, all of which taken together shall constitute one agreement and any
party hereto may execute this Agreement by signing any such counterpart. This
Agreement shall be binding upon Purchaser and the Company at such time as the
Agreement, in counterpart or otherwise, is executed by Purchaser and the
Company.
17. APPLICABLE LAW. This Agreement shall be construed in accordance
with the laws of the State of California without reference to choice of law
principles, as to all matters, including, but not limited to, matters of
validity, construction, effect or performance.
18. NO AGREEMENT TO EMPLOY. Nothing in this Agreement shall affect
any right with respect to continuance of employment by the Company or any of its
subsidiaries. The right of the Company or any of its subsidiaries to terminate
at will the Purchaser's employment at any time (whether by dismissal, discharge
or otherwise), with or without cause, is specifically reserved, subject to any
other written employment agreement to which the Company and Purchaser may be a
party.
19. "MARKET STAND-OFF" AGREEMENT. Purchaser agrees that, if
requested by the Company or the managing underwriter of any proposed public
offering of the Company's securities (including any acquisition transaction
where Company securities will be used as all or part of the purchase price),
Purchaser will not sell or otherwise transfer or dispose of any Shares held by
Purchaser without the prior written consent of the Company or such underwriter,
as the case may be, during such period of time, not to exceed 180 days following
the effective date of the registration statement filed by the Company with
respect to such offering, as the Company or the underwriter may specify.
20. TAX ELECTIONS. Purchaser understands that Purchaser (and not the
Company) shall be responsible for the Purchaser's own tax liability that may
arise as a result of the acquisition of the Shares. Purchaser acknowledges that
Purchaser has considered the advisability of all tax elections in connection
with the purchase of the Shares, including the making of an election under
Section 83(b) under the Internal Revenue Code of 1986, as amended ("Code");
Purchaser further
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acknowledges that the Company has no responsibility for the making of such
Section 83(b) election. In the event Purchaser determines to make a Section
83(b) election, Purchaser agrees to timely provide a copy of the election to the
Company as required under the Code.
21. ATTORNEYS' FEES. If any party shall bring an action in law or
equity against another to enforce or interpret any of the terms, covenants and
provisions of this Agreement, the prevailing party in such action shall be
entitled to recover reasonable attorneys' fees and costs.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
THE COMPANY: PURCHASER:
CKE RESTAURANTS, INC.
By:
---------------------------- --------------------------------------
Name:
---------------------------- --------------------------------------
(Print Name)
Title:
----------------------------
Address:
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CONSENT AND RATIFICATION OF SPOUSE
The undersigned, the spouse of _____________________, a party to the
attached Restricted Stock Award Agreement (the "Agreement"), dated as of
_______________, hereby consents to the execution of said Agreement by such
party; and ratifies, approves, confirms and adopts said Agreement, and agrees to
be bound by each and every term and condition thereof as if the undersigned had
been a signatory to said Agreement, with respect to the Shares (as defined in
the Agreement) made the subject of said Agreement in which the undersigned has
an interest, including any community property interest therein.
I also acknowledge that I have been advised to obtain independent counsel
to represent my interests with respect to this Agreement but that I have
declined to do so and I hereby expressly waive my right to such independent
counsel.
Date:
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(Signature)
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(Print Name)
