Exhibit 10
THIS DOCUMENT CONSTITUTES PART OF
A PROSPECTUS COVERING SECURITIES
THAT HAVE BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933.
XXXXXXX INSTRUMENTS, INC.
RESTRICTED STOCK AGREEMENT AND ELECTION
(CYCLE TWO - ECONOMIC VALUE ADDED INCENTIVE PLAN)
This Restricted Stock Agreement and Election ("Agreement") is entered into
between Xxxxxxx Instruments, Inc., a Delaware corporation (the "Company"), and
_________________________________, an employee of the Company or a Subsidiary
of the Company ("Employee").
RECITALS
A. The Company has established the Xxxxxxx Instruments, Inc. Incentive
Compensation Plan of 1990 as amended (the "Plan"), the terms of which are
hereby incorporated by reference and made a part of this Agreement, which
provides for the issuance of shares of the Company's Common Stock, $.10 par
value, subject to certain restrictions thereon;
B. The Company has established the Xxxxxxx Instruments, Inc. Economic Value
Added Incentive Plan Cycle Two Beginning FY94 ("Cycle Two Incentive"), with
the Committee administering the Plan approving a Restricted Stock Award
Alternative to any cash payment of the Cycle Two Incentive.
C. Employee has requested that any award determined pursuant to the Cycle
Two Incentive, and the additional premium amount determined pursuant to the
Restricted Stock Award Alternative, be made in the form of the Company's
Common Stock issued under the Plan subject to certain restrictions; and
D. The Committee administering the Plan has determined that it would be to
the advantage and best interest of the Company and its stockholders to issue
the Restricted Stock under the Plan and the terms and conditions provided for
herein to Employee in consideration of past services to the Company or its
Subsidiaries, has accepted Employee's request, has advised the Company
thereof, and has instructed the undersigned officer to cause said Restricted
Stock to be issued;
THEREFORE, in consideration of the mutual covenants herein contained and
other good and valuable consideration, receipt of which is hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 - Definitions.
Whenever the following terms are used in this Agreement they shall have the
meaning specified below unless the context clearly indicates to the contrary.
"Board" means the Board of Directors of the Company.
"Change of Control" shall be deemed to occur if any of the following events
occur: (A) any "person," as such term is used in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934 as amended (the "Exchange Act"), other
than an employee benefit plan of the Company, or a trustee or other fiduciary
holding securities under an employee benefit plan of the Company, is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company representing 20% or
more of the combined voting power of the Company's then outstanding voting
securities; (B) individuals who, as of the date hereof, constitute the Board
of the Company (the "Incumbent Board") cease for any reason to constitute at
least a majority of the Board provided that any person becoming a director
subsequent to the date hereof whose election, or nomination for election by
the Company's stockholders, was approved by a vote of at least a majority of
the directors then comprising the Incumbent Board (other than an election or
nomination of an individual whose initial assumption of office is in
connection with an actual or threatened election contest relating to the
election of the directors of the Company, as such terms are used in Rule 14a-
11 of Regulation 14A promulgated under the Exchange Act) shall be considered
as though such person were a member of the Incumbent Board of the Company; (C)
the stockholders of the Company approve a merger or consolidation with any
other corporation, other than (1) a merger or consolidation which would result
in the voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of another entity) more than 80% of the combined voting
power of the voting securities of the Company or such other entity outstanding
immediately after such merger or consolidation, or (2) a merger or
consolidation effected to implement a recapitalization of the Company (or
similar transaction) in which no person acquires 20% or more of the combined
voting power of the Company's then outstanding voting securities; or (D) the
stockholders of the Company approve a plan of complete liquidation of the
Company or an agreement for the sale or disposition by the Company of all or
substantially all of the Company's assets. Notwithstanding the preceding
sentence, a Change of Control shall not be deemed to have occurred if the
"person" described in the preceding sentence is an underwriting syndicate
which has acquired the ownership of 20% or more of the combined voting power
of the Company's then outstanding voting securities solely in connection with
a public offering of the Company's securities.
"Code" means the Internal Revenue Code of 1986, as amended.
"Committee" means the Organization and Compensation Committee of the
Company's Board of Directors.
"Restricted Stock" shall mean Common Stock of the Company, $.10 par value,
issued under the Plan and the terms of this Agreement and subject to the
Restrictions imposed hereunder.
"Restriction Period" means the twenty-four (24) month period beginning on
the date of issuance of Restricted Stock hereunder and ending on the date that
is twenty-four (24) months from the date the Restricted Stock is issued.
"Restrictions" shall mean the restrictions on sale, transfer or other
disposition and the exposure to forfeiture imposed upon the Restricted Stock
under this Agreement.
"Retirement" means Termination of Employment of Employee due to "Early
Retirement", "Normal Retirement" or "Late Retirement" as such terms are
defined under the provisions of the Xxxxxxx Instruments, Inc. Pension Plan, or
if such plan is not applicable to Employee then under the applicable
retirement policy or plan or as determined by the Committee in its discretion.
"Secretary" shall mean the Secretary of the Company.
"Subsidiary" shall mean any corporation in an unbroken chain of corporations
beginning with the Company if each of the corporations other than the last
corporation in the unbroken chain then owns stock possessing 50% or more of
the total combined voting power of all classes of stock in one of the other
corporations in such chain.
"Termination of Employment" shall mean that the employee-employer
relationship between Employee and the Company or a Subsidiary has ended for
any reason, but excluding any termination where there is a simultaneous
reemployment by the Company or a Subsidiary.
"Total Disability" shall mean that Employee has satisfied the criteria for
determination of disability (without regard to any age requirement) for
extended basic life insurance under the Company's life insurance program;
provided, however, that such determination shall in no way be construed to
mean or imply that Employee is otherwise eligible for extended basic life
insurance.
"Treasurer" shall mean the Treasurer of the Company.
ARTICLE II
ELECTION FOR RESTRICTED STOCK IN LIEU OF CASH
Section 2.1 - Election
Employee hereby irrevocably elects to receive the award, if any, determined
pursuant to the Cycle Two Incentive and the premium described in Section
2.2(b) below, in the form of whole shares of Restricted Stock under a grant
from the Plan subject to the provisions of the Plan and the terms and
conditions herein, in lieu of a cash payment.
Section 2.2 - Acknowledgements
With regard to the election in Section 2.1 above, Employee acknowledges and
agrees as follows:
(a) This election, irrevocable once made, is not effective
unless received by the Company on or before August 1, 1995;
(b) This election to receive Restricted Stock in lieu of
cash payment is made for the full amount of any award under the
Cycle Two Incentive and such amount will be increased by and shall
include a thirty-three and one-third percent (33-1/3%) premium. Such
sum shall then be converted into whole shares of Restricted Stock based
on the closing price of Xxxxxxx stock on the last trading day of the
two-year Cycle Two Incentive cycle; and
(c) Amounts which would otherwise result in fractional shares will be paid
in cash on the regular Cycle Two Incentive payment date.
ARTICLE III
ISSUANCE OF RESTRICTED STOCK
Section 3.1 - Issuance of Restricted Stock
In consideration of Employee's agreement to remain in the employ of the
Company or a Subsidiary and for other good and valuable consideration, the
Company agrees to issue to Employee the number of shares of Restricted Stock,
determined pursuant to Section 2.2(b) above and set forth in Schedule A, upon
the terms and conditions set forth in this Agreement. Schedule A shall be
distributed to Employee on or about the regular payment date for the Cycle Two
Incentive. The date of issuance of the Restricted Stock shall be the date
shown on Schedule A.
Section 3.2 - Consideration to Company
As partial consideration for the issuance of Restricted Stock by the
Company, Employee agrees to render faithful and efficient services to the
Company or a Subsidiary with such duties and responsibilities as the Company
shall from time to time prescribe. Nothing in this Agreement or in the Plan
shall confer upon Employee any right to continue in the employ of the Company
or any Subsidiary or shall interfere with or restrict in any way the rights of
the Company and its Subsidiaries, which are hereby expressly reserved, to
terminate employment of Employee at any time for any reason, with or without
cause .
ARTICLE IV
RESTRICTIONS
Section 4.1 - Forfeiture of Restricted Stock
(a) All shares of Restricted Stock shall be forfeited to the Company
immediately upon a voluntary Termination of Employment or an Early Retirement
occurring within twenty-four (24) months from the date of issuance; provided,
however, that where Employee terminates employment due to Early Retirement and
has made a prior Code Section 83(b) election, no forfeiture shall occur but
Restrictions on sale, transfer or other disposition pursuant to Sections 4.2
and 5.2 will remain in effect for any remainder of the Restriction Period.
(b) Notwithstanding Section 4.1(a) above, no shares shall be forfeited to
the Company in the event of a Termination of Employment due to Normal or Late
Retirement, Total Disability, or death. In the event of an involuntary
Termination of Employment, for cause or otherwise, no shares shall be
forfeited but the restrictions on sale, transfer or other disposition pursuant
to Sections 4.2 and 5.2 shall remain in effect for any remainder of the
Restriction Period.
Section 4.2 - Legend
Certificates representing shares of Restricted Stock issued pursuant to this
Agreement shall, until all restrictions lapse and new certificates are issued
pursuant to Section 4.3, bear the following legend:
"The shares represented by this certificate are subject
to reacquisition by Xxxxxxx Instruments, Inc., and such
shares may not be sold or otherwise transferred except
pursuant to the provisions of the Restricted Stock
Agreement by and between Xxxxxxx Instruments, Inc. and
the registered owner of such shares."
Section 4.3 - Lapse of Restrictions
(a) If no forfeiture pursuant to Section 4.1(a) has occurred, the
Restrictions shall lapse with respect to 100% of the shares of Restricted
Stock on the date which is twenty-four (24) months from the date the
Restricted Stock is issued.
(b) Notwithstanding subsection 4.3(a) above, all Restrictions will lapse
with respect to 100% of the shares of Restricted Stock in the following
events: (i) A Termination of Employment by death, Normal or Late Retirement
(but not Early Retirement) or Total Disability; (ii) Death or Total Disability
of Employee during the Restriction Period where during the Restriction Period
Employee had terminated employment due to Early Retirement and had made a
prior Code Section 83(b) election or where an involuntary Termination of
Employment had previously occurred during the Restriction Period; or (iii) A
Change of Control of the Company or other occurrence of events as described in
Sections 4.4 or 4.5 below if the Committee deems the lapse of Restrictions
appropriate.
(c) As soon as practicable, the Company shall, upon the lapse of the
Restrictions, cause new certificates to be issued and delivered to Employee or
his or her legal representative, free from the legend provided for in Section
4.2. Notwithstanding the foregoing, no such new certificate shall be delivered
to Employee or his or her legal representative unless and until Employee or
such legal representative shall have paid to the Company (or other employer
corporation), in cash, the full amount of all federal, state or local income
tax withholdings and other employment taxes applicable to the taxable income
of Employee resulting from the lapse of Restrictions.
Section 4.4 - Merger, Consolidation, Exchange, Acquisition,
Liquidation or Dissolution
In the event that the Company is succeeded by another corporation in a
reorganization, merger, consolidation, acquisition of property or stock,
separation or liquidation, the Board or the Committee may, in its absolute
discretion and on such terms and conditions as it deems appropriate, provide,
by a resolution adopted prior to the occurrence of the reorganization, merger,
consolidation, acquisition of property or stock, separation, or liquidation,
that (i) for some period of time prior to such event, all Restrictions on such
shares of Restricted Stock shall lapse or expire, (ii) obligations of the
Company in relation to such shares of Restricted Stock shall be assumed by
such successor corporation, (iii) such shares of Restricted Stock shall be
canceled and replaced by substitute shares of Restricted Stock of the
successor corporation, or (iv) such sharesof Restricted Stock shall be
forfeited to the Company in consideration for a cash payment in an amount to
be determined by the Committee.
Section 4.5 - Restrictions on New Shares
In the event that the outstanding shares of the Company's Common Stock are
changed into or exchanged for a different number or kind of shares or other
securities of the Company or of another corporation pursuant to a merger of
the Company into another corporation, or the exchange of all or substantially
all of the assets of the Company for the securities of another corporation, or
the acquisition by another corporation of 80% or more of the Company's then
outstanding voting stock, or the liquidation or dissolution of the Company, or
a stock split-up or stock dividend, such new or additional or different shares
or securities which are attributable to Employee in his or her capacity as the
owner of the Restricted Stock, shall be considered to be Restricted Stock and
shall be subject to all of the Restrictions, unless the Committee provides,
pursuant to Section 4.4 or Section 4.3(b), for the expiration of the
Restrictions on the shares of Restricted Stock underlying the distribution of
the new or additional shares or securities.
ARTICLE V
MISCELLANEOUS
Section 5.1 - Administration
The Committee shall have the power to interpret the Plan and this Agreement
and to adopt such rules for the administration, interpretation and application
of the Plan as are consistent therewith and to interpret or revoke any such
rules. Any dispute or disagreement which shall arise under or as a result of
or pursuant to this Agreement or the grant or issuance of Restricted Stock
shall be determined by the Committee in its sole discretion. All actions taken
and all interpretations and determinations made by the Committee in good faith
shall be final, binding and conclusive upon Employee, the Company and all
other interested persons. No member of the Committee shall be personally
liable for any action, determination, or interpretation made in good faith
with respect to the Plan or the Restricted Stock.
Section 5.2 - Restricted Stock Not Transferable
Neither the Restricted Stock nor any interest or right therein or part
thereof shall be liable for the debts, contracts, or engagements of Employee
or his or her successors in interest or shall be subject to disposition by
transfer, alienation, anticipation, pledge, encumbrance, assignment or any
other means whether such disposition be voluntary or involuntary or by
operation of law by judgment, levy, attachment, garnishment or any other legal
or equitable proceedings (including bankruptcy) and any attempted disposition
of such Restricted Stock, interest or right therein or part thereof, shall be
null and void and of no effect; provided, however, that this Section 5.2 shall
not prevent transfers by will or by the applicable laws of descent and
distribution.
Section 5.3 - Conditions to Issuance of Stock Certificates
The Company shall not be required to issue or deliver any certificate or
certificates for shares of stock pursuant to this Agreement prior to
fulfillment of all of the following conditions:
(a) The admission of such shares to listing on all stock exchanges on which
such class of stock is then listed;
(b) The completion of any registration or other qualification of
such shares under any state or federal law or under rulings or
regulations of the Securities and Exchange Commission or of any other
governmental regulatory body, which the Committee shall, in its absolute
discretion, deem necessary or advisable;
(c) The obtaining of any approval or other clearance from any state or
federal governmental agency which the Committee shall, in its absolute
discretion, determine to be necessary or advisable; and
(d) The compliance with all other requirements, including but not limited to
the payment or withholding of income, employment or other taxes, as
legally required or which the Committee shall, in its absolute
discretion, determine to be necessary or advisable.
(e) The lapse of such reasonable period of time as the Committee may from
time to time establish for reasons of administrative convenience.
Section 5.4 - Escrow
The Treasurer or such other escrow holder as the Committee may appoint shall
retain physical custody of the certificates representing the Restricted Stock,
including shares of Restricted Stock issued pursuant to Section 4.5, until all
of the Restrictions expire or shall have been removed; provided, however, that
in no event shall Employee retain physical custody of any certificates
representing Restricted Stock issued to him or her.
Section 5.5 - Notices
Any notice required or permitted hereunder shall be effective when addressed
to the Company in care of its Secretary at 0000 Xxxxxx Xxxxxxxxx, Xxxxxxxxx,
XX. 00000-0000, or to the Employee at the Employee's last known address shown
on Company records, as the case may be, and deposited, postage prepaid and
registered or certified, in the United States mail. Either party may, by
notice to the other given in the above-described manner, change such party's
address for future notices. Any notice which is required to be given to
Employee shall, if Employee is then deceased, be given to Employee's personal
representative if such representative has previously informed the Company of
his or her status and address by written notice in the manner described in
this Section.
Section 5.6 - Rights as Stockholder
Except as otherwise provided herein, Employee shall have all
the rights of a stockholder with respect to the Restricted Stock,
including the right to vote the Restricted Stock and the right to
receive all dividends or other distributions paid or made with respect to
the Restricted Stock.
Section 5.7 - Entire Agreement; Modification
This Agreement constitutes the entire agreement between the parties hereto
and supersedes any and all other written or oral agreements, understandings,
representations or proposals which may have been made prior to or concurrently
with the execution of the Agreement. No modification or amendment of this
Agreement or any additional agreement concerning Restricted Stock will take
effect unless it is approved by the Committee and is in writing and signed by
Employee and the Vice President of Human Resources. Any modification,
amendment, or additional agreement must expressly state the intention of the
parties to modify or supplement the terms of this Agreement.
Section 5.8 - Receipt of Documents
Employee acknowledges the receipt of Cycle Two Incentive plan with
restricted stock award alternative, the Incentive Compensation Plan of 1990 as
amended and restated May 6, 1992, Plan prospectus appendix, and tax
information. Employee acknowledges that he has been encouraged to seek tax and
securities counsel before making the election herein.
Section 5.9 - Titles
Titles are provided herein for convenience only and are not to serve as a
basis for interpretation or construction of this Agreement.
IN WITNESS WHEREOF, this Agreement has been executed and delivered
by the parties hereto.
EMPLOYEE XXXXXXX INSTRUMENTS, INC.
____________________________ By ______________________________
Vice President - Human Resources
Date:_______________________
