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Exhibit 10.14
FORM OF
RESTRICTED STOCK AGREEMENT
This Restricted Stock Agreement (this "Agreement") is made and entered
into as of _________________ (the "Effective Date"), by and between CSK Auto
Corporation, a Delaware corporation (the "Company"), and _________________ (the
"Participant").
WHEREAS, the Participant is a director of the Company;
WHEREAS, the Company has established the CSK Auto Corporation Directors
Stock Plan (the "Plan") whereby the Company may issue restricted shares of the
Company's common stock, par value .01 per share ("Common Stock"), to certain of
the directors of the Company;
WHEREAS, the Company has adopted the Outside Director Compensation
Policy (the "Policy") in order to implement the Plan for the purposes of
compensating outside directors of the Company; and
WHEREAS, in order to attract, motivate and retain the services of the
Participant, the Company is willing to issue restricted shares of Common Stock
to the Participant on the terms and conditions set forth in this Agreement;
NOW, THEREFORE, the Company hereby agrees to issue Participant certain
restricted shares of Common Stock, and Participant hereby accepts such shares,
on the terms and conditions hereinafter set forth.
1. AUTHORITY.
The shares of Common Stock issuable to the Participant pursuant to this
Agreement will be issued pursuant to the authority granted under the Plan, and
are subject to all the terms and conditions of the Plan, as the same may be
amended from time to time. The interpretation and construction by the committee
administering the Plan of the Plan, this Agreement and such rules and
regulations as may be adopted by such committee for the purpose of administering
the Plan shall be final and binding upon the Participant. Until the shares of
Common Stock issuable to the Participant pursuant to this Agreement shall vest
or be forfeited, the Company shall, upon written request therefor, send a copy
of the Plan and the Policy, in its then current form, to the Participant.
2. GRANT OF AWARD.
Pursuant to the terms of the Plan and the Policy, ________________
(____) shares (the "Shares") of restricted Common Stock will be issued in the
name of the Participant and transferred to the Participant. The Shares will be
restricted by being subject to vesting and non-transferability as hereafter
provided in this Agreement and shall be subject to such limitations on transfer
as are contained in the Plan, the federal and state securities laws applicable
to the Shares or any other limitations on transferability as may be imposed by
the Company.
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3. RISK OF FORFEITURE.
The Shares will be subject to a substantial risk of forfeiture. The
Participant must continue to serve as a director of the Company on the Vesting
Date set forth below in order to vest in the ownership of the Shares. If the
Participant's directorship of the Company is terminated for any reason other
than (i) death or disability, or (ii) an Approved Sale (as defined) of the
Company, in either case prior to the Vesting Date, the Shares shall revert to
the Company.
4. RESTRICTIONS.
Until the Participant vests in the Shares, the Shares may not be sold,
assigned, conveyed, gifted, pledged, hypothecated or otherwise transferred in
any manner.
5. VESTING.
5.1 General. Fifty percent of the Shares shall vest upon the six month
anniversary of the Effective Date (the "Initial Vesting Date"), on the condition
that the Participant remains as a director of the Company on the Initial Vesting
Date, and the remaining fifty percent shall vest upon the earlier of (i) the one
year anniversary of the Effective Date, or (ii) the first date following the
Effective Date on which a duly called meeting (whether annual or special) of the
stockholders of the Company is held for the purpose of electing directors of the
Company at which directors are elected (the "Final Vesting Date" and together
with the Initial Vesting Date, the "Vesting Dates"), on the condition that the
Participant remains as a director of the Company on the Final Vesting Date.
5.2 Death or Disability. The Shares shall vest in their entirety upon
the Participant's death or disability. For this purpose, the term "disability"
shall mean an illness, incapacity or disability of a nature which prevents the
Participant from fulfilling his duties as a director of the Company for an
aggregate of six (6) calendar months during the period between the Effective
Date and the Final Vesting Date. The Company, at its option and expense, is
entitled to retain a physician reasonably acceptable to the Participant to
confirm the existence of such illness, incapacity or disability, and the
determination of such physician shall be binding upon the Company and the
Participant.
5.3 Approved Sale of the Company. The Shares shall vest in their
entirety upon the closing of an Approved Sale that occurs prior to the Final
Vesting Date if, immediately prior to such closing, Participant is serving as a
director of the Company. "Approved Sale" means a transaction or a series of
related transactions with an acquiror which had not previously been a
stockholder of the Company (other than as a result of purchasing shares in the
public market) which results in a bona fide, unaffiliated change of beneficial
ownership of (a) 80% of the Company's common equity securities or (b) all or
substantially all of its assets, whether pursuant to the sale of the stock or
assets of the Company or any of its subsidiaries, or a merger or consolidation
involving the Company or any of its subsidiaries.
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6. ISSUANCE OF CERTIFICATES.
Promptly following the Stockholder Approval, the Company will issue and
deliver to the Participant, in the name of the Participant, a certificate
representing ownership of the Shares. The certificate representing the Shares
shall contain the following legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ISSUED PURSUANT TO A
RESTRICTED STOCK AGREEMENT, DATED AS OF ____________ (THE "AGREEMENT"),
BY AND BETWEEN CSK AUTO CORPORATION AND THE PERSON IN WHOSE NAME THESE
SECURITIES ARE REGISTERED. THE TERMS AND CONDITIONS OF THE AGREEMENT
SUBJECT THESE SECURITIES TO A SUBSTANTIAL RISK OF FORFEITURE AND TO
RESTRICTIONS ON TRANSFERABILITY.
If the Participant is serving as a director of the Company on any Vesting Date,
the Participant may surrender the certificate representing ownership of the
Shares to the Company for reissuance of a certificate representing the vested
Shares, which certificate does not contain the foregoing legend, and a
certificate representing unvested Shares, if any, which certificate shall
contain the foregoing legend.
7. VOTING; DIVIDENDS; CERTAIN CORPORATE TRANSACTIONS.
The Participant shall not be entitled to exercise any voting rights
with respect to the Shares or to receive any dividends (other than a stock
dividend) paid with respect thereto, until the Shares have vested. In the event
that the outstanding securities of any class then comprising the Shares are
increased, decreased or exchanged for or converted into cash, property and/or a
different number or kind of securities, or cash, property and/or securities are
distributed in respect of such outstanding securities, in either case as a
result of a reorganization, merger, consolidation, recapitalization,
reclassification, dividend (other than a regular cash dividend) or other
distribution, stock split, reverse stock split or the like, then, unless the
committee administering the Plan shall determine otherwise, the terms "Common
Stock" or "Shares" shall, from and after the date of such event, include such
cash, property and/or securities so distributed in respect of the Shares, or
into or for which the Shares are so increased, decreased, exchanged or
converted.
8. SECTION 83(B) ELECTION.
The Participant understands and agrees that the vesting of the
Participant in the Shares shall constitute compensation income arising from
services performed by the Participant for the Company. The Participant
understands that the taxable income recognized by the Participant as a result of
the award of Shares hereunder, and the withholding liability and required date
of withholding with respect thereto, if any, will be affected by a decision by
the Participant to make an election pursuant to Section 83(b) of the Internal
Revenue Code of 1986, as amended (an "83(b) Election"). The Participant
understands and agrees that the Participant will have the sole responsibility
for determining whether to make an 83(b) Election with respect to the Shares,
and for properly making such election and filing the election with the relevant
taxing authorities on a timely basis. The Participant will not rely on the
Company or any of its officers, accountants,
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attorneys or other agents for any advice in connection with the decision whether
to make, or procedures for making, the 83(b) Election, and acknowledges that the
Company has urged the Participant to consult with the Participant's own tax
advisor with respect to the desirability of and procedures for making an 83(b)
Election with respect to the Shares, including when the election should be made.
The Participant agrees to submit to the Company a copy of any 83(b) Election
with respect to the Shares immediately upon filing such election with the
relevant taxing authority.
9. PAYMENTS TO COMPANY.
By the execution of this Agreement, the Participant agrees to pay to
the Company the amount of federal, state and local taxes that the Company is
required to withhold and remit to the taxing authorities applicable to the
Participant as a result of the transactions contemplated by this Agreement
(collectively, "Taxes"). The Participant shall pay to the Company an amount
equal to the Taxes the Company is required to withhold and remit as calculated
by the Company in accordance with the rules and regulations of applicable taxing
authorities governing the calculation of such withholding. The Participant shall
make such withholding payment to the Company on the Vesting Date or upon the
Participant making an 83(b) Election. If the Participant fails or refuses to
make such payment to the Company on its due date, the Participant hereby
authorizes the Company, in addition to any of its other remedies, to withhold
from any other compensation or payments due by the Company to the Participant an
amount sufficient to pay such withholding plus interest as hereafter provided
until such withholding and interest is paid in full. Any delinquent payments
made by the Participant to the Company shall bear interest at the lesser of the
maximum interest rate permitted by law or one and one-half percent (1-1/2%) per
calendar month, or portion thereof, compounded monthly, until the entire
withholding is paid in full.
10. MISCELLANEOUS.
10.1 Notice. Any notice required or permitted to be given hereunder
shall be deemed sufficiently given if sent by registered or certified mail,
postage prepaid, addressed to the addressee at his or its address last provided
the sender in writing by the addressee for purposes of receiving notices
hereunder or, unless or until such address shall be so furnished, to the address
indicated opposite his or its signature to this Agreement. Each party may also
provide notice by sending the other party a facsimile at a number provided by
such other party.
10.2 No Right to Employment. This Agreement is not an employment
agreement and shall not confer on the Participant any right to be retained in
the employment of the Company or any of its successors or affiliates.
10.3 Unfunded Benefits. Nothing in this Agreement shall be construed as
requiring the Company to segregate, earmark, purchase or otherwise set aside or
fund any investment or contract to secure its obligations under this Agreement.
The rights of the Participant hereunder shall be those of a general unsecured
creditor of the Company.
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10.4 No Trust. Nothing contained in this Agreement or any action taken
pursuant to the provisions of this Agreement shall create or be construed to
create any irrevocable trust of any kind, fiduciary relationship between the
parties.
10.5 Benefits Nontransferable. The rights of the Participant to the
issuance of the Shares as provided herein shall not be assigned, transferred,
pledged or encumbered, and any attempted assignment shall be void. If any
creditor, trustee in bankruptcy or other person attempts to attach or otherwise
acquire any of the Participant's interest under this Agreement, the Participant
shall immediately forfeit all rights under this Agreement.
10.6 Governing Law. This Agreement shall be governed by and construed
and enforced in accordance with the laws of the State of Arizona and all
questions relating to the validity and performance hereof and remedies hereunder
shall be determined in accordance with such law.
10.7 Modification and No Waiver of Breach. No waiver or modification of
this Agreement shall be binding unless it is in writing signed by the parties
hereto. No waiver by a party of a breach hereof by the other party shall be
deemed to constitute a waiver of a future breach, whether of a similar or
dissimilar nature, except to the extent specifically provided in any written
waiver under this Section 10.7.
10.8 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same agreement.
10.9 Captions. The captions used herein are for ease of reference only
and shall not define or limit the provisions hereof.
10.10 Entire Agreement. This Agreement together with any agreement,
plans or other documents implementing the terms of this Agreement constitute the
entire agreement between the parties hereto relating to the matters encompassed
hereby and supersede any prior oral or written agreements.
10.11 Arbitration. Any dispute arising under this Agreement shall be
resolved by binding arbitration conducted under the auspices and pursuant to the
rules of the American Arbitration Association and held in Phoenix, Arizona, or
such other place as the parties may mutually agree. Each party shall bear its or
his own costs and expenses in any such arbitration and one-half of the
arbitrator's fees and expenses.
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IN WITNESS WHEREOF, this Agreement has been duly executed as of the day
and year first written above.
CSK AUTO CORPORATION,
a Delaware corporation
By:
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Name: Xxxxxxx Xxxxxxx
Title: Chief Executive Officer
Address for Notices:
000 X. Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: General Counsel
With a copy to:
Investcorp International Inc.
000 Xxxx Xxxxxx, 00xx Xxxxx Xxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxxxxx Xxxxxxx
Participant
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Address for Notices:
Form of Restricted Stock Agreement
