Contract
Exhibit 10.2
CTS
CORPORATION
THIS
AGREEMENT is made as of the ___ day of ____, 20__ (the "Grant Date") between CTS
CORPORATION, an Indiana corporation (the "Company"), and [Officer / GM
Name] (the "Grantee").
1.
Grant. Subject to the
terms set forth in this Agreement and in the Company's 2009 Omnibus Equity and
Performance Incentive Plan (the "Plan"), the Company hereby grants to the
Grantee [# of units] Restricted Stock Units (the “Award”). Except as
expressly provided herein, capitalized terms used herein shall have the meaning
ascribed to such terms under the Plan.
It is
intended that this Agreement and its administration comply with the provisions
of Section 409A of the Code. Accordingly, notwithstanding any
provision in this Agreement or in the Plan to the contrary, this Agreement and
the Plan will be interpreted, applied and, to the minimum extent necessary to
comply with Section 409A of the Code, amended, so that the Agreement does not
fail to meet, and is operated in accordance with, the requirements of paragraphs
(2), (3) and (4) of Section 409A(a) of the Code. As used herein,
“Code” means the Internal Revenue Code of 1986 as amended from time to time, and
any interpretations thereof issued by the U.S. Treasury Department on which the
Company is permitted to rely.
2. Vesting and Settlement of
Restricted Stock Units. The Award shall vest and become
non-forfeitable in _____ installments beginning one year after the grant
date. The award shall be calculated by multiplying the specified
percentage on the specified date by the initial number of Restricted Stock Units
specified in Section 1 on this Agreement.
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Installment
One: ____
percent (_____%) on ____________
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Installment
Two: ____
percent (_____%) on ____________
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·
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Installment
Three: ____
percent (_____%) on ____________
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Each date
specified above will be a "Vesting Date," provided that the Grantee remains in
the continuous employ of the Company and is an employee of the Company on the
Vesting Date.
Restricted
Stock Units shall be settled on the basis of one Share for each vested
Restricted Stock Unit. The Company shall distribute to the Grantee
Shares equal to ________ percent (_________%) multiplied by the number of
initial Restricted Stock Units specified in Section 1 above, on _____________,
____________ percent (_____%) multiplied by the number of initial Restricted
Stock Units specified in Section 1 above, on __________, and ___________ percent
(_____%) multiplied by the number of initial Restricted Stock Units specified in
Section 1 above, on _______, or as soon thereafter as practicable, but in no
event later than March 15th of the
year following the year in which the applicable Vesting Date occurs (each such
date of distribution, a "Settlement Date"). The Company’s obligations to the
Grantee with respect to vested Restricted Stock Units will be satisfied in full
upon the distribution of one Share for each Restricted Stock Unit. On
the Settlement Date(s), the Company may, at its election, either (i) credit the
number of Shares to be distributed to the Grantee as of that Settlement Date to
a book-entry account in the name of the Grantee held by the Company’s transfer
agent; or (ii) deliver to the Grantee a certificate representing the
number of Shares transferred to the Grantee as of that Settlement Date. In no
event may any Settlement Date be accelerated except in accordance with Section
409A of the Code.
Notwithstanding anything to the
contrary in this Agreement, upon the first to occur of the following events, all
Restricted Stock Units granted hereunder shall vest and become nonforfeitable
and Shares shall be distributed to the Grantee, estate, guardian or designated
beneficiary of the Grantee as the case may be, in the settlement of Restricted
Stock Units as soon as reasonably practicable, but in no event later than 30
days after the occurrence of such event, and such date(s) of distribution shall
be deemed to be the Settlement Date(s):
(a) Grantee’s
becoming disabled, as defined by Section 409A of the Code;
(b) Grantee’s
death;
(c) A
change in ownership or effective control of the Company, or in the ownership of
a substantial portion of the assets of the Company, within the meaning of
Section 409A of the Code; or
(d) Grantee’s
unforeseeable emergency, as defined and not in excess of the amount permitted by
Section 409A of the Code.
Unless the Committee determines
otherwise in its sole discretion, if the Grantee’s employment with the Company
terminates for any reason not specified above, all Restricted Stock Units
granted hereunder which have not vested as of the date of such termination of
employment shall be permanently forfeited on such termination date.
3. Tax
Withholding. The Company shall have the right to deduct from
any compensation due the Grantee from the Company any federal, state, local or
foreign taxes required by law to be withheld in connection with the issuance of
Shares or vesting of any Restricted Stock Unit pursuant to this Agreement
provided that the amount withheld shall not exceed the legally required minimum
withholding. To the extent that the amounts payable to the Grantee
are insufficient for such withholding, it shall be a condition to the issuance
of Shares or vesting of the Restricted Stock Units, as the case may be, that the
Grantee shall pay such taxes or make provisions that are satisfactory to the
Company for the payment thereof.
The
Company shall retain Shares otherwise deliverable on the Settlement Date in an
amount sufficient to satisfy the amount of tax required to be withheld provided
that such amounts shall not exceed the statutorily required minimum withholding.
The determination of the number of Shares retained for this purpose shall be
based on the Fair Market Value of the Shares on the Settlement Date. In the
event that the retention of Shares to satisfy withholding taxes would
otherwise result in
the delivery of a fractional Share, the Company will round down to the next
whole Share and apply the value of the fractional Share to the recipient's tax
obligations or, in the alternative, the Company may make such other arrangements
to avoid the issuance of a fractional Share as may be permitted by
law. No Shares shall be transferred to the Grantee hereunder until
such time as all applicable withholding taxes have been
satisfied. Under the Code, employment tax withholding shall be
calculated based on the Fair Market Value of the Shares on the applicable
Vesting Date and income tax withholding shall be calculated based on the Fair
Market Value of the Shares on the Settlement Date. The Company
will not retain Shares as described herein unless tax
withholding applies under the laws of the local
jurisdiction.
4. Rights Not
Conferred. The Grantee shall have none of the rights of a
stockholder with respect to the Restricted Stock Units, including the right to
receive dividends or vote stock, until such time, if any, that Shares are
distributed to the Grantee in settlement thereof. The Grantee is
further advised that until distribution, the Company’s obligation will be merely
that of an unfunded and unsecured promise of the Company to deliver Shares in
the future, and the rights of the Grantee will be no greater than that of an
unsecured general creditor. No assets of the Company will be held as
collateral security for the obligations of the Company hereunder, and all assets
of the Company will be subject to the claims of the Company’s
creditors. Nothing contained in the Plan or in this Agreement shall
confer upon the Grantee any right with respect to continued employment by the
Company or any subsidiary thereof or interfere in any way with the right of the
Company to terminate the employment of the Grantee at any time.
5. Agreement Not
Assignable. This Agreement and the Restricted Stock Units
awarded hereunder are not transferable or assignable by the Grantee; provided
that no provision herein shall prevent the distribution of shares to the
Grantee’s estate or designated beneficiary, in the event of the Grantee’s
death.
6. Adjustments. In
the event of any merger, reorganization, consolidation, recapitalization, stock
dividend, stock split, reverse stock split, spin-off, combination, repurchase or
exchange of Shares or other securities of the Company, or corporate transaction
or event having an effect similar to the foregoing, the Committee shall adjust
the Award, as provided by the Plan.
7. Governing
Law. This Agreement shall be construed in accordance with and
governed by the laws of the State of Indiana.
8. Amendments. Any
amendment to the Plan shall be deemed to be an amendment to this Agreement to
the extent that the amendment is applicable hereto; provided, however, that no
amendment to the Plan or the Agreement shall adversely affect the value or
number of the Grantee’s Restricted Stock Units without the Grantee’s written
consent, except to the extent necessary to comply with the provisions of Section
409A of the Code.
9. 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. All actions taken and all interpretations and determinations
made by the Committee shall be final and binding upon the Grantee, 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 this Agreement.
10. Effect on Other Employee
Benefit Plans. The value of the Restricted Stock Units granted
pursuant to this Agreement shall not be included as compensation, earnings,
salary or other similar terms used when calculating the Grantee’s benefits under
any employee benefit plan sponsored by the Company or any subsidiary, except as
such plan otherwise expressly provides. The Company expressly
reserves its rights to amend, modify, or terminate any of the Company’s employee
benefit plans.
11. Severability. If
any provision of the Plan or this Agreement is, becomes, or is deemed to be
invalid, illegal or unenforceable in any jurisdiction or would disqualify the
Plan or award hereunder under any law deemed applicable by the Committee, such
provision shall be construed or deemed amended to conform to applicable laws, or
if it cannot be so construed or deemed amended without, in the determination of
the Committee, materially altering the purpose or intent of the Plan or award,
such provision shall be stricken as to such jurisdiction or award, and the
remainder of the Plan or Agreement shall be in full force and
effect.
12. Construction. The
Restricted Stock Units granted hereunder are being issued pursuant to Section 10
of the Plan (“Restricted Stock Award”) and are subject to the terms of the
Plan. A copy of the Plan has been given to the Grantee, and
additional copies of the Plan are available upon request during normal business
hours at the principal executive offices of the Company. To the
extent that any provision of this Agreement violates or is inconsistent with an
express provision of the Plan, the Plan provision shall govern and any
inconsistent provision in this Agreement shall be of no force or
effect.
13. Data
Protection. By signing below, the Grantee expressly consents
to the transfer and use of personal data by the Company and its agents in
connection with the administration of this Award.
14. Binding
Effect. This Agreement shall be binding upon the heirs,
executors, administrators and successors of the parties hereto.
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as
of the day and year first above written.
____________________________________
Grantee: «Name»
CTS
CORPORATION
By:___________________________________
Xxxxx X.
Xxxxxxx
Senior Vice President
Administration
