STAMFORD INDUSTRIAL GROUP, INC. RESTRICTED STOCK AWARD AGREEMENT
2007
STOCK INCENTIVE PLAN
RESTRICTED
STOCK AWARD AGREEMENT
(the
“Agreement”) made as of this 27th
day of
December, 2007, by and between Stamford Industrial Group, Inc., a Delaware
corporation, having its principal office at Xxx Xxxxxxxx Xxxxxx, 00xx
Xxxxx,
Xxxxxxxx, Xxxxxxxxxxx 00000 (the “Company”), and Xxxxxx X. Xxxxxxxx, an
individual residing at 00 Xxxxxxx Xxxx, Xxxxxxx, XX 00000 (the “Employee”).
Capitalized terms not defined herein shall have the meanings ascribed to them
in
the Company's 2007 Stock Incentive Plan.
WHEREAS,
the
Company has heretofore adopted the Stamford Industrial Group, Inc. 2007 Stock
Incentive Plan (the “Plan”) for the benefit of certain employees, officers,
directors, consultants, independent contractors and advisors of the Company
or
Subsidiaries of the Company, which Plan has been approved by the Company's
stockholders;
WHEREAS,
the
Employee is a valued and trusted employee of the Company and/or one of its
subsidiaries and the Company believes it to be in the best interests of the
Company to secure the future services of the Employee by providing the Employee
with an inducement to remain an employee of the Company and/or one of its
Subsidiaries through the grant of restricted shares of common stock of the
Company, par value $.0001 per share (the “Common Stock”)
WHEREAS,
the
Company has previously granted to the Employee a stock restricted stock award
(the “2006 Restricted Stock Award”) pursuant to the terms of his employment
agreement, dated September 22, 2006, between the Company and the Employee (the
“Employment Agreement”); and
WHEREAS,
the
Company and the Employee now wish to replace the 2006 Restricted Stock Award
with a Award issued under the Plan.
NOW,
THEREFORE,
the
parties agree as follows:
1. CANCELLATION
OF 2006 RESTRICTED STOCK AWARD.
The
Employee hereby agrees to the cancellation of the 2006 Restricted Stock Award
Grant and, pursuant to the terms hereof, the Company hereby agrees to grant
to
the Employee a new Restricted Stock Award to replace the 2006 Restricted Stock
Award Grant. Following such cancellation, the Employee shall have no rights
whatsoever with respect to the 2006 Restricted Stock Award Grant.
2. RESTRICTED
STOCK AWARD.
Subject
to the provisions hereinafter set forth and the terms and conditions of the
Plan, the Company hereby grants to the Employee, as of the date hereof (the
“Grant Date”), a Restricted Stock Award of up to the maximum number of shares of
Common Stock (the “Restricted Shares”) as determined in accordance with Section
3, paragraphs (a) and (b), below, and subject to the vesting schedule set forth
below, such number being subject to adjustment as provided in the Plan. As
more
fully described below, the Restricted Shares granted hereby are subject to
forfeiture by the Employee if certain criteria are not satisfied.
1
3. VESTING. The
Restricted Shares shall vest in accordance with the following
provisions:
(a) Subject
to the provisions of paragraph (b) below, the Company agrees to issue and grant
to the Employee the following Restricted Shares under
the
Plan (or such successor or other Company stock incentive plans as the Company
may hereafter maintain or adopt),
as
priced in the manner set forth below, upon the occurrence of the following
events during the term hereof:
|
(i)
|
$1,000,000
of Restricted Shares shall be granted and fully vested on the 10-K
Filing
Date (as hereinafter defined) for the first fiscal year commencing
after
December 31, 2007 in which the Company achieved annual Adjusted EBITDA
(as
hereinafter defined) of at least $25 million in such fiscal year
(the
“First Target Year”);
|
|
(ii)
|
an
additional $1,000,000 of Restricted Shares shall be granted and fully
vested on the 10-K Filing Date for the first fiscal year occurring
after
the First Target Year in which the Company has achieved annual Adjusted
EBITDA of at least $50 million in such fiscal year (such year, the
“Second
Target Year”); and
|
|
(iii)
|
an
additional $1,000,000 of Restricted Shares shall be granted and fully
vested on the 10-K Filing Date for the first fiscal year occurring
after
the Second Target Year in which the Company has achieved annual Adjusted
EBITDA of at least $75 million in such fiscal
year.
|
For
purposes hereof, "10-K Filing Date" means the date when the Company first files
with the Securities and Exchange Commission its Annual Report on Form 10-K
for
any given year. No subsequent amendment of such report shall change the 10-K
Filing Date.
For
purposes hereof, "Adjusted EBITDA" shall have the meaning set forth in the
Plan,
provided
that
consolidated capital gains shall be deducted from Consolidated Net Income when
determining Adjusted EBITDA for purposes of this Agreement.
(b) The
number of Restricted Shares to be granted for any fiscal year shall be
determined by dividing dollar amount of the Restricted Shares to be awarded
by
the Fair Market Value (as defined and determined in accordance with the Plan)
of
the Common Stock on the 10-K Filing Date.
(c) Notwithstanding
the vesting schedule set forth above, such vesting schedule may be accelerated
by the Board of Directors or the Compensation Committee of the Board of
Directors (the “Committee”) in their sole decision.
2
(d) Upon
the
vesting date, the vested portion of the Restricted Shares shall be issued to
the
Employee in accordance with the Plan and the terms hereof, including Section
4
below.
(e) If
the
Employee is terminated by the Company or its Subsidiaries for Cause (as defined
in the Plan) or voluntarily terminates employment by the Company or its
Subsidiaries, prior to the satisfaction of the vesting provisions set forth
above, no further portion of the Restricted Shares shall become vested pursuant
to this Agreement and such unvested Restricted Shares shall be forfeited
effective as of the date that the Employee ceases to be so employed by the
Company.
(f) Nothing
in the Plan or this Agreement shall confer on Employee any right to continue
in
the employ of, or other relationship with, the Company or any Subsidiary of
the
Company, or limit in any way the right of the Company or any Affiliate or
Subsidiary of the Company to terminate Employee's employment or other
relationship at any time, with or without Cause. This Agreement does not
constitute an employment contract. This Agreement does not guarantee employment
for the length of time of the Vesting Schedule or for any portion
thereof.
(g) Tax
Consequences.
Employee understands that Employee may suffer adverse tax consequences as a
result of the grant, vesting or disposition of the Restricted Shares. Employee
represents that Employee has consulted with his or her own independent tax
consultant(s) as Employee deems advisable in connection with the grant, vesting
or disposition of the Restricted Shares and that Employee is not relying on
the
Company for any tax advice.
(h) Termination.
The
right of the Employee to receive the Restricted Shares shall expire on the
earlier to occur of (i) termination of Employee's employment with the
Company and all Subsidiaries, and (ii) the fifth anniversary of the Grant
Date.
4. ISSUANCE
AND WITHHOLDING.
(a) Upon
vesting, the Company shall (subject to the provisions of paragraph (b) below)
issue the vested Restricted Shares registered in the name of Employee,
Employee's authorized assignee, or Employee's legal representative, and shall
deliver certificates representing the Restricted Shares.
(b) Subject
to Section 17 below, prior to the issuance of the Restricted Shares, Employee
must pay or provide for any applicable federal or state withholding obligations
of the Company.
5. COMPLIANCE
WITH LAWS AND REGULATIONS. The
issuance and transfer of Restricted Shares shall be subject to compliance by
the
Company and Employee with all applicable requirements of federal and state
securities laws and with all applicable requirements of any stock exchange
or
quotation system on which the Company's Common Stock may be listed at the time
of such issuance or transfer
3
6. NON-TRANSFERABILITY.
Until
the Restricted Shares shall be vested and issued and until the satisfaction
of
any and all other conditions specified herein, the Restricted Shares may not
be
sold, transferred, assigned, pledged or otherwise encumbered or disposed of
by
the Employee, except upon the written consent of the Company and, in any case,
in compliance with the terms and conditions of this Agreement. The terms of
this
Restricted Stock Award shall be binding upon the executors, administrators,
successors and assigns of Employee.
7. PRIVILEGES
OF STOCK OWNERSHIP.
Employee shall not have any of the rights of a stockholder with respect to
any
Restricted Shares until the Restricted Shares are issued to
Employee.
8. INTERPRETATION.
Any
dispute regarding the interpretation of this Agreement shall be submitted by
Employee or the Company to the Committee for review. The resolution of such
a
dispute by the Committee shall be final and binding on the Company and
Employee.
9. ENTIRE
AGREEMENT.
The
Plan is incorporated herein by reference. This Agreement and the Plan constitute
the entire agreement and understanding of the parties hereto with respect to
the
subject matter hereof and supersede all prior understandings and agreements
with
respect to such subject matter.
10. NOTICES.
Any
notice required to be given or delivered to the Company under the terms of
this
Agreement shall be in writing and addressed to the Corporate Secretary of the
Company at its principal corporate offices. Any notice required to be given
or
delivered to Employee shall be in writing and addressed to Employee at the
address indicated above or to such other address as such party may designate
in
writing from time to time to the Company. All notices shall be deemed to have
been given or delivered upon: personal delivery; three (3) days after deposit
in
the United States mail by certified or registered mail (return receipt
requested); one (1) business day after deposit with any return receipt express
courier (prepaid); or one (1) business day after transmission by
facsimile.
11. SUCCESSORS
AND ASSIGNS.
The
Company may assign any of its rights under this Agreement. This Agreement shall
be binding upon and inure to the benefit of the successors and assigns of the
Company. Subject to the restrictions on transfer set forth herein, this
Agreement shall be binding upon Employee and Employee's heirs, executors,
administrators, legal representatives, successors and assigns.
12. GOVERNING
LAW.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of Delaware, applicable to agreements made and to be performed entirely
within such state, other than conflict of laws principles thereof directing
the
application of any law other than that of Delaware.
13. ACCEPTANCE.
Employee
hereby acknowledges receipt of a copy of the Plan and this Agreement. Employee
has read and understands the terms and provisions thereof, and accepts this
Restricted Stock Award subject to all the terms and conditions of the Plan
and
this Agreement. Employee acknowledges that there maybe adverse tax consequences
upon the grant or the vesting of this Restricted Stock Award, issuance or
disposition of the Restricted Shares and that the Company has advised Employee
to consult a tax advisor regarding the tax consequences of the grant, vesting,
issuance or disposition.
4
14. COVENANTS
OF THE EMPLOYEE.
The
Employee agrees (and for any proper successor hereby agrees) upon the request
of
the Committee, to execute and deliver a certificate, in form reasonably
satisfactory to the Committee, regarding applicable Federal and state securities
law matters.
15. OBLIGATIONS
OF THE COMPANY
(a) Notwithstanding
anything to the contrary contained herein, neither the Company nor its transfer
agent shall be required to issue any fraction of a share of Common Stock, and
the Company shall issue the largest number of whole Restricted Shares of Common
Stock to which Employee is entitled and shall return to the Employee the amount
of any unissued fractional share in cash.
(b)
The
Company may endorse such legend or legends upon the certificates for Restricted
Shares issued to the Employee pursuant to the Plan and may issue such “stop
transfer” instructions to its transfer agent in respect of such Restricted
Shares as, in its discretion, it determines to be necessary or appropriate
to:
(i) prevent a violation of, or to perfect an exemption from, the registration
requirements of the Securities Act; or (ii) implement the provisions of the
Plan
and any agreement between the Company and the Employee or grantee with respect
to such Restricted Shares.
(c) The
Company shall pay all issue or transfer taxes with respect to the issuance
or
transfer of Restricted Shares to Employee, as well as all fees and expenses
necessarily incurred by the Company in connection with such issuance or
transfer.
(d)
All
Restricted Shares issued following vesting shall be fully paid and
non-assessable to the extent permitted by law.
16. NO
SECTION 83(b) ELECTION.
Employee shall not file an election with the Internal Revenue Service under
Section 83(b).
17. WITHHOLDING
TAXES.
The
Employee acknowledges that the Company is not responsible for the tax
consequences to the Employee of the granting, vesting or issuance of the
Restricted Shares, and that it is the responsibility of the Employee to consult
with the Employee's personal tax advisor regarding all matters with respect
to
the tax consequences of the granting, vesting and issuance of the Restricted
Shares. The Company shall have the right to deduct from the Restricted Shares
or
any payment to be made with respect to the Restricted Shares any amount that
federal, state, local or foreign tax law requires to be withheld with respect
to
the Restricted Shares or any such payment, provided that such amount of
Restricted Shares to be withheld does not exceed the minimum required statutory
withholding amount. Alternatively, the Company may require that the Employee,
prior to or simultaneously with the Company incurring any obligation to withhold
any such amount, pay such amount to the Company in cash or in shares of the
Company's Common Stock (including shares of Common Stock retained from the
Restricted Stock Award creating the tax obligation), which shall be valued
at
the Fair Market Value of such shares on the date of such payment. In any case
where it is determined that taxes are required to be withheld in connection
with
the issuance, transfer or delivery of the shares, the Company may reduce the
number of shares so issued, transferred or delivered by such number of shares
as
the Company may deem appropriate to comply with such withholding. The Company
may also impose such conditions on the payment of any withholding obligations
as
may be required to satisfy applicable regulatory requirements under the Exchange
Act, if any.
5
18. MISCELLANEOUS
(a) If
the
Employee loses this Agreement, or if this Agreement is stolen, damaged or
destroyed, the Company shall, subject to such reasonable terms as to indemnity
as the Committee, in its sole discretion shall require, replace the
Agreement.
(b) This
Agreement cannot be amended, supplemented or changed, and no provision hereof
can be waived, except by a written instrument making specific reference to
this
Agreement and signed by the party against whom enforcement of any such
amendment, supplement, modification or waiver is sought. A waiver of any right
derived hereunder by the Employee shall not be deemed a waiver of any other
right derived hereunder.
(c) This
Agreement may be executed in any number of counterparts, but all counterparts
will together constitute but one agreement.
(d)
In
the
event of a conflict between the terms and conditions of this Agreement and
the
Plan, the terms and conditions of the Plan shall govern. All capitalized terms
used herein but not defined shall have the meanings given to such terms in
the
Plan.
[Signature
Page Follows:]
6
In
Witness Whereof,
the
Company and the Employee have duly executed this Restricted Stock Award
Agreement in duplicate as of the Grant Date.
| Employee: | Stamford Industrial Group, Inc. | ||
| By: | |||
|
Xxxxxx
X. Xxxxxxxx
|
Name:
|
||
|
Title:
|
|||
