EXHIBIT 10.17
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RESTRICTED STOCK AGREEMENT
The Compensation Committee (the "Committee") of the Board of Directors of
Chattem, Inc. ("Chattem") has selected A. Xxxxxxxxx Xxxxxx XX as the recipient
("Recipient") of the following described shares of restricted common stock (the
"Restricted Shares") in accordance with the following terms:
Administration: The Committee of the Board of Directors of
Chattem will administer the grant of
Restricted Shares.
Shares Subject to Grant: Chattem hereby awards the Recipient
Twenty-Five Thousand (25,000) Restricted
Shares. Chattem shall instruct its transfer
agent to deliver a certificate to the
Recipient representing the Restricted Shares
as soon as reasonably practicable. The
certificate representing the Restricted
Shares shall include an appropriate legend
concerning the restrictions upon such
Restricted Shares.
Restrictions: The Restricted Shares shall be owned free of
restrictions with respect to Six Thousand Two
Hundred Fifty (6,250) of the Restricted
Shares on the first anniversary of this
Agreement and an additional Six Thousand Two
Hundred Fifty (6,250) of such Restricted
Shares shall be owned free of restrictions,
on a cumulative basis, on each of the three
(3) succeeding anniversaries of this
Agreement so that four (4) years from the
date of this Agreement all Twenty-Five
Thousand (25,000) of such Restricted Shares
shall be owned free of restrictions.
Transferability: The restricted portion of the Restricted
Shares are not transferable.
Termination of Employment: If prior to lapse of restrictions the
Recipient's employment has terminated for any
reason other than death, retirement,
disability or a Change in Control (as defined
in the Recipient's Employment Agreement),
then the portion of the Restricted Shares
that remain subject to restrictions shall
automatically be forfeited to Chattem.
Death, Disability or Change Upon the death or disability of the Recipient
in Control: or a Change in Control, all of the Restricted
Shares shall immediately be owned free of
restrictions.
Taxes: The Recipient currently intends to make a
"Section 83(b) election" under the Internal
Revenue Code with respect to the Restricted
Shares, immediately triggering the payment of
ordinary income tax with respect to the fair
market value of the Restricted Shares on the
date hereof. Chattem shall reimburse the
Recipient on a "grossed up" basis for the
payment of federal income or any other tax
resulting from Recipient's making the Section
83(b) election or receipt of the Restricted
Shares.
Plan: The Restricted Shares are being granted under
Chattem's Non-Statutory Stock Option Plan-
2000.
Section 16: It is intended that the Restricted Shares be
granted in compliance with the provisions of
Rule 16(b)(3) of the Securities Exchange Act
of 1934, as amended.
This Restricted Stock Agreement is dated to be effective this 29th day of
October, 2002.
Chattem, Inc.
By:
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Xxx Xxxxxx, Chairman
Recipient:
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A. Xxxxxxxxx Xxxxxx XX
