ICONIX BRAND GROUP, INC. RESTRICTED STOCK PERFORMANCE UNIT AGREEMENT
Exhibit
10.4
To: Xxxx
X. Xxxx
Date of Award: September 23,
2009
You are
hereby awarded (the “Award”), effective as of the date hereof, 472,673
restricted stock performance units (“Unit or PSUs”, as the case may be) each of
which shall represent the right to receive one share (the “Share”) of common
stock $.001 par value (“Common Stock”), of Iconix Brand Group, Inc., a Delaware
corporation (the “Company”), pursuant to the Company’s 2009 Equity Incentive
Plan (the “Plan”), subject to certain vesting restrictions specified below (the
“Vesting”).
This
Award is made pursuant to Section 2.4.2 of the Employment Agreement (“Employment
Agreement”) entered into between you and the Company effective January 1, 2008,
as amended by the agreement between you and the Company entered into on May 21,
2008. Pursuant to Sections 2 and 12f. of the Plan,
for purposes of this Award, the term “Cause” shall be as defined in the
Employment Agreement. Defined terms that are not otherwise
defined in the Plan or this Award, are as defined in the Employment
Agreement. This Award is intended to comply with the terms of the
Employment Agreement and the terms of the Plan, and in the event of any
inconsistency between the terms of the Employment Agreement and the terms of the
Plan, the terms of the Plan shall control.
During
the period commencing on the Award date and terminating on the fifth anniversary
of the Effective Date, except as otherwise provided herein, the Units may not be
sold, assigned, transferred, pledged, or otherwise encumbered and are subject to
forfeiture as provided herein.
Vesting
The PSUs
shall be performance based and shall vest based on the achievement of annual
performance goals as described on Exhibit C
to your Employment Agreement, which is incorporated herein by reference
(“Exhibit C”), and upon certification of
achievement by the Compensation Committee as set forth on Exhibit C. For purposes of determining vesting of the
PSU’s, one third of the PSU’s shall relate to each of the Performance Periods
from January 1 through December 31, commencing with the period January 1, 2010
though December 31, 2010, and ending with the period from January 1, 2012
through December 31, 2012.
Notwithstanding
anything to the contrary contained herein or in the Employment Agreement, in the
event of a Change in Control (as defined, for the purposes of this Award, in
Section 5.4.4 of the Employment Agreement), (x) the unvested PSUs shall vest as
follows: (a) with regard to the PSUs that could vest in the calendar
year of the Change of Control, based on the achievement of the performance goals
for the year in which such Change in Control occurs (including as a result of achieved aggregate
growth), calculated as of the date of such Change in Control (with the
date on which the Change of Control occurs being deemed to be the end of a
Performance Period for purposes of the calculations set forth on Exhibit C, but with no adjustment of the level of the
goals), and (b) with regard to the PSUs that could otherwise only vest in
calendar years after the Change in Control, based on the achievement of the
performance goals for later Performance Periods that would be deemed to have
been achieved as of the date of the Change of Control (with the date on which
the Change of Control occurs being deemed to be the end of each such later
Performance Period for purposes of the calculations set forth on Exhibit C, but with no adjustment of the level of the
goals), including, in the case of clauses (a) and (b), as a consequence of the
price per share of the Common Stock (including as a result of a deemed
liquidation following a Change in Control which is a sale of the Company’s
assets) being paid by the acquirer in connection with the Change in Control and
(y) any portion of the PSUs that remains unvested on the date of such Change in
Control after giving effect to the foregoing clause (x) shall be forfeited as of
the date of such Change in Control.
Notwithstanding
the foregoing, in the event of a termination of your employment with the Company
prior to any Performance Vesting Date, your then unvested PSUs as of a Date of
Termination shall vest or be forfeited as follows:
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1.
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If
Termination upon Death, the portion of the PSUs subject to vesting in the
calendar year the Date of Termination occurs (including, as a result of
achieved aggregate growth) shall immediately become vested on the
certification of the Compensation Committee promptly after the Date of
Termination based on the achievement of the performance goals for such
year, calculated through the Date of Termination (with the Date of
Termination being deemed to be the end of a Performance Period for
purposes of the calculations set forth on Exhibit C, but with no adjustment of the level of
goals), and shall be distributed to your estate in shares of Common Stock
sixty (60) days after the Date of Termination. After giving
effect to the foregoing, any portion of the PSUs that remain unvested on
the certification following the Date of Termination shall be forfeited as
of the Date of Termination.
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2.
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If
Termination upon Disability, subject to Section 5.4.8 of the Employment
Agreement, the portion of the PSUs subject to vesting in the calendar year
the Date of Termination occurs (including, as a result of achieved
aggregate growth) shall immediately become vested on the certification of
the Compensation Committee promptly after the Date of Termination based on
the achievement of the performance goals for such year, calculated through
the Date of Termination (with the Date of Termination being deemed to be
the end of a Performance Period for purposes of the calculations set forth
on Exhibit C, but with no adjustment
of the level of goals), and shall be distributed in shares of Common Stock
to you as provided in, and subject to, Sections 5.4.8 and 9.8.2. of the
Employment Agreement. After giving effect to the foregoing, any
portion of the PSUs that remain unvested on the certification following
the Date of Termination shall be forfeited as of the Date of
Termination.
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2
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3.
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If
Termination is without Cause or for Good Reason, subject to Section 5.4.8
of the Employment Agreement, the portion of the PSUs subject to vesting in
the calendar year the Date of Termination occurs (including, as a result
of achieved aggregate growth) shall immediately become vested on the
certification of the Compensation Committee promptly after the Date of
Termination based on the achievement of the performance goals for such
year calculated through the Date of Termination (with the Date of
Termination being deemed to be the end of a Performance Period for
purposes of the calculations set forth on Exhibit C, but with no
adjustment of the level of the goals), and shall be distributed in shares
of Common Stock to you as provided in, and subject to, Sections 5.4.8 and
9.8.2. of the Employment Agreement. After giving effect to the
foregoing, any portion of the PSUs that remain unvested on the
certification following the Date of Termination shall be forfeited as of
the Date of Termination..
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4.
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If
Termination is for Cause or without Good Reason, 100% of the then unvested
PSUs shall be forfeited.
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Payment
Other
than as provided in the immediately preceding clauses 1, 2 and 3 as to
conditions and timing of distribution of Common Stock with respect to PSUs
vesting as a result of a termination of your employment and Section 9.8.2 of the
Employment Agreement with regard to equity distributed as a result of your
incurring a Separation from Service as an employee of the Company, any vested
portion of the PSUs shall be distributed to you in shares of Common Stock in the
year following the year of each applicable Performance Vesting Date following
the Compensation Committee’s certification of the level of attainment of the
annual performance goals. Notwithstanding anything to the contrary
contained herein or in the Employment Agreement, except as to Sections 5.4.8 and
9.8.2 of the Employment Agreement, all vested PSUs (including those vested in
connection with a Change in Control) shall be distributed to you in shares of
Common Stock simultaneous with the Company’s incurring a Change in
Control.
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Dividends
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With
respect to the PSUs, you will have the right to receive dividend
equivalents (in cash or in kind, as the case may be) in respect of any
dividend distributed to holders of Common Stock of record on and after the
Date of Award; provided, that any such dividend equivalents shall be
subject to the same restrictions as the PSUs with regard to which they are
issued, including without limitation, as to vesting (including accelerated
vesting) and time of distribution. All such withheld dividends
shall not earn interest, except as otherwise determined by the
Administrator. You will not receive withheld
dividends on any PSUs which are forfeited and all such dividends shall be
forfeited along with the PSUs which are
forfeited.
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Tax
Withholding
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The
Company shall have the right to withhold from your compensation an amount
sufficient to fulfill its or its Affiliate’s obligations for any
applicable withholding and employment taxes. Alternatively, the
Company may require you to pay to the Company the amount of any taxes
which the Company is required to withhold with respect to the Shares, or,
in lieu thereof, to retain or sell without notice a sufficient number of
Shares to cover the amount required to be withheld. The Company
may withhold from any cash dividends paid with respect to PSUs an amount
sufficient to cover taxes owed, if any, as a result of the dividend
payment. The Company’s method of satisfying its withholding
obligations shall be solely in the discretion of the Administrator,
subject to applicable federal, state, local and foreign
laws. The Company shall have a lien and security interest in
the Shares and any accumulated dividends to secure your obligations
hereunder.
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3
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Tax
Representations
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You
hereby represent and warrant to the Company as follows:
(a) You
have reviewed with your own tax advisors the federal, state, local and
foreign tax consequences of this investment and the transactions
contemplated by this Agreement. You are relying solely on such
advisors and not on any statements or representations of the Company or
any of its Employees or agents.
(b) You
understand that you (and not the Company) shall be responsible for your
own tax liability that may arise as a result of this investment or the
transactions contemplated by this
Agreement.
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Securities
Law
Representations
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The
following two paragraphs shall be applicable if, on the date of issuance
of the Shares, no registration statement and current prospectus under the
Securities Act of 1933, as amended (the “1933 Act”), covers the issuance
by the Company to you of Shares, and shall continue to be applicable for
so long as such registration has not occurred and such current prospectus
is not available:
(a) You hereby
agree, warrant and represent that you will acquire the Shares to be issued
hereunder for your own account for investment purposes only, and not with
a view to, or in connection with, any resale or other distribution of any
of such shares, except as hereafter permitted. You further
agree that you will not at any time make any offer, sale, transfer, pledge
or other disposition of such Shares to be issued hereunder without an
effective registration statement under the 1933 Act, and under any
applicable state securities laws or an opinion of counsel acceptable to
the Company to the effect that the proposed transaction will be exempt
from such registration. You agree to execute such instruments,
representations, acknowledgments and agreements as the Company may, in its
sole discretion, deem advisable to avoid any violation of federal, state,
local or foreign law, rule or regulation, or any securities exchange rule
or listing agreement.
(b) The
certificates for Shares to be issued to you hereunder shall bear the
following legend:
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4
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“The
shares represented by this certificate have not been registered under the
Securities Act of 1933, as amended, or under applicable state securities
laws. The shares have been acquired for investment and may not
be offered, sold, transferred, pledged or otherwise disposed of without an
effective registration statement under the Securities Act of 1933, as
amended, and under any applicable state securities laws or an opinion of
counsel acceptable to the Company that the proposed transaction will be
exempt from such registration.”
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Stock
Dividend, Stock Split and Similar Capital Changes
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In
the event of any change in the outstanding shares of the Common Stock of
the Company by reason of a stock dividend, stock split, combination of
shares, recapitalization, merger, consolidation, transfer of assets,
reorganization, conversion or what the Administrator deems in its sole
discretion to be similar circumstances, the number and kind of Units and
shares subject to this Agreement shall be appropriately adjusted in a
manner to be determined in the sole discretion of the Administrator, whose
decision shall be final, binding and conclusive in the absence of clear
and convincing evidence of bad faith. Any Units or shares of
Common Stock or other securities received, as a result of the foregoing,
by you with respect to the PSUs shall be subject to the same restrictions
as the PSUs, the certificate or other instruments evidencing such shares
of Common Stock or other securities shall be legended as provided above
with respect to the PSUs, and any cash dividends received with respect to
such Units shall be subject to the same
restrictions as dividend equivalents with respect to the
PSUs.
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Non-Transferability
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Unvested
PSUs are not transferable.
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No
Effect on Employment
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Nothing herein guarantees you employment
for any specified period of time. This means that, except as
provided in the Employment Agreement, either you or the Company or any of
its Affiliates may terminate your employment at any time for any reason,
with or without cause, or for no reason. You recognize that,
for instance, you may terminate your employment or the Company or any of
its Affiliates may terminate your employment prior to the date on which
your Units become
vested.
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5
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No
Effect on Corporate Authority
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You
understand and agree that the existence of this Agreement will not affect
in any way the right or power of the Company or its shareholders to make
or authorize any or all adjustments, recapitalizations, reorganizations,
or other changes in the Company’s capital structure or its business, or
any merger or consolidation of the Company, or any issuance of bonds,
debentures, preferred or other stocks with preferences ahead of or
convertible into, or otherwise affecting the common shares or the rights
thereof, or the dissolution or liquidation of the Company, or any sale or
transfer of all or any part of its assets or business, or any other
corporate act or proceeding, whether of a similar character or
otherwise.
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Arbitration
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Any
dispute or disagreement between you and the Company with respect to any
portion of this Agreement or its validity, construction, meaning,
performance or your rights hereunder shall be settled by arbitration in
accordance with Section 9.7 of the Employment Agreement and to the extent
provided therein Section 2.4.2 of the Employment Agreement and Exhibit
C. However, prior to
submission to arbitration you will attempt to resolve any disputes or
disagreements with the Company over this Agreement amicably and
informally, in good faith, for a period not to exceed two
weeks. Thereafter, subject to the
foregoing, the dispute or disagreement will be submitted to
arbitration. At any time prior to a decision from the
arbitrator(s) being rendered, you and the Company may resolve the dispute
by settlement.
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Governing
Law
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The
laws of the State of Delaware will govern all matters relating to this
Agreement, without regard to the principles of conflict of
laws.
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Notices
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Any
notice you give to the Company must be in writing and either
hand-delivered or mailed to the executive office of the Company. If
mailed, it should be addressed to the Executive Vice President and General
Counsel of the Company. Any notice given to you will be
addressed to you at your address as reflected on the personnel records of
the Company. You and the Company may change the address for notice by like
notice to the other. Notice will be deemed to have been duly delivered
when hand-delivered or, if mailed, on the day such notice is
postmarked.
Copies
of notices should also be provided to:
For
the Company:
Xxxxxx
Xxxxxxx
Blank
Rome LLP
The
Chrysler Building
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx, X.X. 00000
Direct:
000-000-0000
Fax:
000-000-0000
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For
you:
Xxxxxxx
X. Cost
Xxxxxxxxx
Law Offices
000
Xxxxx Xxxxxx
Xxx
Xxxx, Xxx Xxxx 00000
Direct:
000-000-0000
Main:
000-000-0000
Fax:
000-000-0000
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Agreement
Subject to Plan; Entire Agreement
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This
Agreement shall be subject to the terms of the Plan in effect on the date
hereof, subject to “Conflicting Terms”
below, which terms are hereby incorporated herein by reference and
made a part hereof. This Agreement constitutes the entire
understanding between the Company and you with respect to the subject
matter hereof and no amendment, supplement or waiver of this Agreement, in
whole or in part, shall be binding upon the Company unless in writing and
signed by the President of the Company
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Conflicting
Terms
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Wherever
a conflict may arise between the terms of this Agreement and the terms of
the Plan in effect on the date hereof, the terms of the Plan will
control.
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Please
sign the Acknowledgement attached to this Restricted Stock Performance Unit
Agreement and return it to the Company’s Secretary, thereby indicating your
understanding of and agreement with its terms and conditions.
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By:
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/s/ Xxxxxx
Xxxxxx
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7
ACKNOWLEDGMENT
I hereby
acknowledge receipt of a copy of the Plan. I hereby represent that I
have read and understood the terms and conditions of the Plan and of the
Restricted Stock Performance Unit Agreement. I hereby signify my
understanding of, and my agreement with, the terms and conditions of the Plan
and of the Restricted Stock Performance Unit Agreement. I agree to
accept as binding, conclusive, and final all decisions or interpretations of the
Administrator concerning any questions arising under the Plan with respect to
this Restricted Stock Performance Unit Agreement. I accept this
Restricted Stock Performance Unit Agreement in full satisfaction of any previous
written or oral promise made to me by the Company or any of its Affiliates with
respect to PSUs.
Date: September 23,
2009
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/s/ Xxxx X. Xxxx
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Xxxx
X. Xxxx
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8
