EXHIBIT 10.37
PARSUP AWARD AGREEMENT
PERFORMANCE ACCELERATED RESTRICTED STOCK UNIT PROGRAM
PURSUANT TO THE XXXXXXX ENTERTAINMENT COMPANY
1997 OMNIBUS STOCK OPTION AND INCENTIVE PLAN
This PARSUP AWARD AGREEMENT (the "Agreement") is by and between Xxxxxxx
Entertainment Company, a Delaware corporation (the "Company"), and
___________________, (the "Grantee"), pursuant to the Company's 1997 Omnibus
Stock Option and Incentive Plan (the "Plan").
SECTION 1. Grant of PARSUP Award. Effective May 8, 2003 (the "Date of
Grant"), the Grantee was awarded ___________ restricted stock units (the
"Restricted Stock Units"), subject to the terms and conditions of this Agreement
and the Plan.
SECTION 2. Vesting of the Award. The Restricted Stock Units shall vest
in accordance with the following:
(a) One hundred percent (100%) of the Restricted Stock Units will vest
on February 1, 2008, provided the Grantee has continued in the employment of the
Company through such date (the "Vested Date").
(b) All restrictions shall lapse and the Restricted Stock Units shall
become one hundred percent (100%) vested with respect to one-half (1/2) of
Grantee's Restricted Stock Units upon Grantee's termination of employment due to
death, Disability or Retirement if such event occurs prior to February 1, 2005,
provided Grantee has continued in employment of the Company through such event.
All restrictions shall lapse and the Restricted Stock Units shall become one
hundred percent (100%) vested with respect to all of Grantee's Restricted Stock
Units upon Grantee's termination of employment due to death, Disability or
Retirement, if such event occurs on or after February 1, 2005 and prior to
February 1, 2008, provided Grantee has continued in the employment of the
Company through such event.
(c) Notwithstanding the foregoing, the Restricted Stock Units are
eligible for earlier performance vesting beginning March 1, 2005 based on the
Company's financial performance. The specific performance targets for early
vesting are recommended by the Committee and approved by the Board and can be
modified in the same manner.
SECTION 3. Termination of Employment for Other Reasons. In the event
that Grantee terminates employment with the Company for any reason other than
those reasons set forth in Section 2(b), all of the unvested Restricted Stock
Units held by Grantee at the time of termination of employment shall be
forfeited to the Company.
SECTION 4. Payment of Vested Restricted Stock Units. Grantee shall be
entitled to receive the Company's Common Stock, par value $.01 per share (the
"Common Stock") for Restricted Stock Units whose restrictions have lapsed
pursuant to Sections 2 and 9.9 herein. Grantee will receive the number of shares
equal to the number of vested Restricted Stock Units.
Once the Restricted Stock Units vest and unless a deferral election is made as
provided below, upon Grantee's request, stock certificates will be issued.
SECTION 5. Deferral Election. To help alleviate the tax burden of the
PARSUP program on participants and to provide an incentive for executives to
continue in employment, the Committee has approved a program whereby
participants can defer the receipt of their vested PARSUP shares. Under the
program, to be effective a deferral election must be in writing and delivered to
the Company's secretary by January 1 of any year with respect to that particular
calendar year. Thus, if the Grantee wishes to defer the receipt of Common Stock
on attributable to Restricted Share Units that vest in 2005, the Grantee must
file such election with the Company no later than January 1, 2005. The shares
can be deferred to a specified date in the future or to the Grantee's
termination of employment date, whichever occurs first. The Grantee can elect a
lump sum distribution of shares on the deferral date (or one year after that
date) or can elect annual installments of shares over five (5) years. This
election is irrevocable with respect to the payment of shares for which such
election is made.
SECTION 6. Dividends. The Grantee shall be entitled to receive either:
(a) Cash payments equal to any cash dividend and other distributions
paid with respect to a corresponding number of shares;
(b) Additional Restricted Stock Units equal to any cash dividend and
other distributions paid with respect to a corresponding number of shares; or
(c) If dividends or distributions are paid in shares, the fair market
value of such shares converted into Restricted Stock Units.
In the case of (b) or (c) above, the additional Restricted Stock Units shall be
subject to the same forfeiture restrictions and restrictions on transferability
as apply to the Restricted Stock Units with respect to which they were paid.
SECTION 7. Rights as a Stockholder. Except as provided above, the
Grantee shall not have voting or any other rights as a stockholder of the
Company with respect to Restricted Stock Units. Grantee will obtain full voting
and other rights as a stockholder of the Company upon the settlement of
Restricted Stock Units in shares.
SECTION 8. Governing Provisions. This Agreement is made under and
subject to the provisions of the Plan, and all of the provisions of the Plan are
also provisions of this Agreement. Capitalized terms used but not defined herein
shall have the same meanings ascribed to such terms in the Plan. If there is a
difference or conflict between the provisions of this Agreement and the
provisions of the Plan, the provisions of the Plan will govern. By signing this
Agreement, the Grantee confirms that he or she has received a copy of the Plan.
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SECTION 9. Miscellaneous.
9.1 Entire Agreement. This Agreement and the Plan contain the
entire understanding and agreement between the Company and the Grantee
concerning the Restricted Stock Units granted hereby and supersede any prior or
contemporaneous negotiations and understandings. The Company and the Grantee
have made no promises, agreements, conditions, or understandings relating to the
Restricted Stock Units, either orally or in writing, that are not included in
this Agreement or the Plan.
9.2 Employment. By establishing the Plan, granting awards
under the Plan, and entering into this Agreement, the Company does not give the
Grantee any right to continue to be employed by the Company or to be entitled to
any remuneration or benefits not set forth in this Agreement or the Plan. None
of the provisions of this Agreement or the plan will interfere with or limit the
right of the company to terminate the Grantee's employment at any time.
9.3 Captions. The captions and section numbers appearing in
this Agreement are inserted only as a matter of convenience. They do not define,
limit, construe, or describe the scope or intent of the provisions of this
Agreement.
9.4 Counterparts. This Agreement may be executed in
counterparts, each of which when signed by the Company and the Grantee will be
deemed an original and all of which together will be deemed the same agreement.
9.5 Notice. Any notice or communication having to do with this
Agreement must be given by personal delivery or by certified mail, return
receipt requested, addressed, if to the Company, to the principal office of the
Company and, if to the Grantee, to the Grantee's last known address on the
personnel records of the Company.
9.6 Amendment. This Agreement may be amended by the Company,
provided that unless the Grantee consents in writing, the Company cannot amend
this Agreement if the amendment will materially change or impair the Grantee's
rights under this Agreement and such change is not to the Grantee's benefit.
Nevertheless, the Committee shall have the authority to cancel all or any
portion of any outstanding restrictions prior to the Vested Date with respect to
any or all of the Restricted Stock Units awarded on such terms and conditions as
the Committee shall deem appropriate.
9.7 Succession and Transfer. Each and all of the provisions of
this Agreement are binding upon and inure to the benefit of the Company and the
Grantee and their heirs, successors, and assigns. However, neither the
Restricted Stock Units nor this Agreement is transferable prior to the Vested
Date other than by will or by the laws of descent and distribution.
9.8 Governing Law. This Agreement shall be governed and
construed exclusively in accordance with the law of the State of Delaware
applicable to agreements to be performed in the State of Delaware to the extent
it may apply.
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9.9 Change in Control. Upon the occurrence of any of the
events described in Section 13(c) of the Plan, (a) all restrictions under the
Plan and the Agreement with respect to the Restricted Stock Units, including the
restriction on transfer set forth in Section 9.7 hereof, shall automatically
expire and be of no further force or effect, (b) an "Acceleration Date" as
defined in Section 13(c) of the Plan shall be the "Vested Date" for all purposes
hereunder, and (c) notwithstanding the schedule set forth on Exhibit A hereto,
the number of shares of Vested Stock shall equal the total number of shares of
Restricted Stock Units subject to this Agreement.
IN WITNESS WHEREOF, the Company and the Grantee have executed
this Agreement to be effective as of May 8, 2003.
GRANTEE: XXXXXXX ENTERTAINMENT COMPANY
By:
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Xxxxxx X. Xxxx, Senior Vice President
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