SXC HEALTH SOLUTIONS CORP. RESTRICTED STOCK UNIT AWARD AGREEMENT
Exhibit 10.6
SXC Health Solutions Corp., a corporation existing under the laws of the Yukon Territory of
Canada (the “Company”), hereby grants (the “Employee”) as of , (the
“Grant Date”), pursuant to Section 7.2 of the SXC Health Solutions Corp. Long-Term Incentive Plan
(the “Plan”), a restricted stock unit award (the “Award”) of restricted stock units, upon
and subject to the restrictions, terms and conditions set forth below. Capitalized terms not
defined herein shall have the meanings specified in the Plan.
1. Award Subject to Acceptance of Agreement. The Award shall be null and void unless
the Employee shall accept this Agreement by executing it in the space provided below and returning
it to the Company.
2. Restriction Period and Vesting. (a) Subject to Section 2(e), the Award shall vest
(i) with respect to one-quarter (1/4) of the restricted stock units subject to the Award on the
first anniversary of the Grant Date, an additional one-quarter (1/4) of the restricted stock units
subject to the Award on the second anniversary of the Grant Date, an additional one-quarter (1/4)
of the restricted stock units subject to the Award on the third anniversary of the Grant Date, and
the remaining one-quarter (1/4) of the restricted stock units subject to the Award on the fourth
anniversary of the Grant Date, or (ii) earlier pursuant to Section 2(b) or (d) hereof (the
“Restriction Period”).
(b) Subject to Section 2(e), if the Company terminates the Employee’s employment by reason of
permanent disability or the Employee’s employment terminates due to death, the Award shall become
fully vested as of the effective date of the Employee’s termination of employment or the date of
death, as the case may be. For purposes of this Agreement, “permanent disability” shall mean the
inability of the Employee to substantially perform his or her duties for a continuous period of at
least six months as determined by the Committee.
(c) Subject to Section 2(e), if the Employee’s employment by the Company terminates for any
reason other than permanent disability or death, the portion of the Award, if any, which is not
vested as of the effective date of the Employee’s termination of employment shall be forfeited and
cancelled by the Company.
(d) (1) In the event of a Change in Control (as defined in Appendix A), the Award shall
immediately vest in full.
(2) In the event of a Change in Control pursuant to paragraph (3) or (4) of Appendix A, the
Board of Directors (as constituted prior to such Change in Control) may, in its discretion (subject
to existing contractual arrangements):
| (i) | require that shares of stock of the corporation resulting from such Change in Control, or a parent corporation thereof, be substituted for some or all of the Shares (as defined in Section 3) issuable pursuant to the Award, as determined by the Board of Directors; and/or | ||
| (ii) | require the Award, in whole or in part, to be surrendered to the Company by the Employee and to be immediately cancelled by the Company, and provide for the Employee to receive a cash payment in an amount not less than the amount determined by multiplying the number of restricted stock units subject to the Award immediately prior to such cancellation (but after giving effect to any adjustment pursuant to Section 12.4 of the Plan in respect of any transaction that gives rise to such Change in Control) by the highest per share price offered to holders of shares of the Company’s common stock, no par value per share (the “Common Stock”), in any transaction whereby the Change in Control takes place. |
(3) The Company may, but is not required to, cooperate with the Employee if the Employee is
subject to Section 16 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), to
assure that any cash payment or substitution in accordance with the foregoing to the Employee is
made in compliance with Section 16 and the rules and regulations thereunder.
(e) The vesting terms in any written employment agreement between the Company or any Affiliate
of the Company and the Employee shall prevail over the terms of this Agreement.
3. Conversion of Restricted Stock Units and Issuance of Shares. Upon the vesting of
all or any portion of the Award in accordance with Section 2 hereof, one share of the Common Stock
shall be issuable for each restricted stock unit that vests on such date (the “Shares”), subject to
the terms and provisions of the Plan and this Agreement, and not later than 30 days thereafter, the
Company will transfer such Shares to the Employee upon satisfaction of any required tax withholding
obligations. No fractional shares shall be issued under this Agreement.
4. No Rights as a Shareholder; Dividend Equivalents. Prior to the issuance and
transfer of Shares upon vesting, the Employee will be credited with amounts equal to any cash
dividends that would be payable to the Employee if the Employee had been transferred such Shares,
which amounts shall accrue during the Restriction Period and be paid in cash upon lapse of the
Restriction Period. This Section 4 will not apply with respect to record dates for dividends
occurring prior to the Grant Date or after the Restriction Period has lapsed. During the
Restriction Period, the Employee (and any person succeeding to the Employee’s rights pursuant to
the Plan) will not be a shareholder of record of the Shares underlying the Award and will have no
voting or other shareholder rights with respect to such Shares.
5. Termination of Award. In the event that the Employee shall forfeit all or a
portion of the restricted stock units subject to the Award, the Employee shall promptly return this
Agreement to the Company for cancellation. Such cancellation shall be effective regardless of
whether the Employee returns this Agreement.
6. Additional Terms and Conditions of Award.
6.1 Nontransferability of Award. During the Restriction Period, the restricted stock
units subject to the Award and not then vested may not be transferred by the Employee other than by
will, the laws of descent and distribution or pursuant to Section 12.5 of the Plan on a beneficiary
designation form approved by the Company. Except as permitted by the foregoing, during the
Restriction Period, the restricted stock units subject to the Award and not then vested may not be
sold, transferred, assigned, pledged, hypothecated, encumbered or otherwise disposed of (whether by
operation of law or otherwise) or be subject to execution, attachment or similar process. Any such
attempted sale, transfer, assignment, pledge, hypothecation or encumbrance, or other disposition of
such shares shall be null and void.
6.2. Withholding Taxes. As a condition precedent to the delivery to the Employee of
any of the Shares subject to the Award, the Employee shall pay to the Company (or shall cause a
broker-dealer on behalf of the Employee to pay to the Company) such amount of cash as the Company
may be required, under all applicable federal, state, local or other laws or regulations, to
withhold and pay over as income or other withholding taxes (the “Required Tax Payments”) with
respect to the Award. The Employee acknowledges and agrees to satisfy his or her obligation with
respect to the Required Tax Payments by selling such number of Shares subject to the Award as is
necessary to make a cash payment to the Company in an amount equal to the Required Tax Payments (or
as close thereto as practicable), such sale to be effected on the Employee’s behalf through a
broker (and other procedures) designated by the Company as soon as practicable following any
vesting date (with such broker selecting the trade date and the selling price). This Section 6.2
is intended to constitute a written plan pursuant to Rule 10b5-1(c) under the Securities Exchange
Act of 1934. To the extent applicable, the Employee shall take actions necessary to ensure that
any such sales shall comply with Rule 144 under the Securities Act of 1933.
6.3. Compliance with Applicable Law. The Award is subject to the condition that if
the listing, registration or qualification of the Shares subject to the Award upon any securities
exchange or under any law, or the consent or approval of any governmental body, or the taking of
any other action is necessary or desirable as a condition of, or in connection with, the vesting of
the restricted stock units or the delivery of the Shares hereunder, the Shares subject to the Award
may not be delivered, in whole or in part, unless such listing, registration, qualification,
consent or approval shall have been effected or obtained, free of any conditions not acceptable to
the Company. The Company agrees to use reasonable efforts to effect or obtain any such listing,
registration, qualification, consent or approval.
6.4. Delivery of Certificates. Subject to Section 6.2, as soon as practicable after
the vesting of the Award, in whole or in part, the Company shall deliver or cause to be delivered
one or more certificates issued in the Employee’s name (or such other name as is acceptable to the
Company and designated in writing by the Employee) representing the number of vested shares. The
Company shall pay all original issue or transfer taxes and all fees and expenses incident to such
delivery, except as otherwise provided in Section 6.2.
6.5. Award Confers No Rights to Continued Employment. In no event shall the granting
of the Award or its acceptance by the Employee give or be deemed to give the Employee any right to
continued employment by the Company or any Affiliate of the Company.
6.6. Decisions of Board or Committee. The Board of Directors of the Company or the
Committee shall have the right to resolve all questions which may arise in connection with the
Award. Any interpretation, determination or other action made or taken by the Board of Directors
or the Committee regarding the Plan or this Agreement shall be final, binding and conclusive.
6.7. Company to Reserve Shares. The Company shall at all times prior to the
cancellation of the Award reserve and keep available, either in its treasury or out of its
authorized but unissued shares of Common Stock, the full number of unvested restricted stock units
subject to the Award from time to time.
6.8. Agreement Subject to the Plan; Section 409A of the Code. This Agreement is
subject to the provisions of the Plan (including the adjustment provision set forth in Section 12.4
thereof) and shall be interpreted in accordance therewith. The Employee hereby acknowledges
receipt of a copy of the Plan. This Award is intended to be exempt from Section 409A of the
Internal Revenue Code of 1986, as amended (the “Code”), as a “short-term deferral,” within the
meaning of regulations issued under Section 409A of the Code, and this Agreement shall be
interpreted and construed in accordance with such intent and in a manner that avoids the imposition
of taxes and other penalties under Section 409A of the Code. The Company reserves the right to
amend this Agreement to the extent it determines in its sole discretion such amendment is necessary
or appropriate to comply with applicable law, including but not limited to Section 409A of the
Code. Notwithstanding the foregoing, under no circumstances shall the Company be responsible for
any taxes, penalties, interest or other losses or expenses incurred by the Employee due to any
failure to comply with Section 409A of the Code.
7. Miscellaneous Provisions.
7.1. Meaning of Certain Terms. As used herein, the term “vest” shall mean no longer
subject to forfeiture and all rights hereunder shall be deemed to be vested. As used herein,
employment by the Company shall include employment by an Affiliate of the Company.
7.2. Successors. This Agreement shall be binding upon and inure to the benefit of any
successor or successors of the Company and any person or persons who shall, upon the death of the
Employee, acquire any rights hereunder in accordance with this Agreement or the Plan.
7.3. Notices. All notices, requests or other communications provided for in this
Agreement shall be made in writing by (a) actual delivery to the party entitled thereto, (b)
mailing to the last known address of the party entitled thereto, via certified or registered mail,
return receipt requested or (c) telecopy with confirmation of receipt. The notice, request or
other communication shall be deemed to be received, in the case of actual delivery, on the date of
its actual receipt by the party entitled thereto, in the case of mailing, on the tenth calendar day
following the date of such mailing, and in the case of telecopy, on the date of confirmation of
receipt; provided, however, that if a notice, request or other communication is not received during
regular business hours, it shall be deemed to be received on the next succeeding business day of
the Company.
7.4. Governing Law. This Agreement and all determinations made and actions taken
pursuant hereto, to the extent not otherwise governed by the laws of the United States, shall be
governed by the laws of the State of Delaware and construed in accordance therewith without giving
effect to conflicts of laws principles.
7.5 Reports Filed with the Securities and Exchange Commission. The Company files
periodic and current reports and proxy statements with the Securities and Exchange Commission
(“SEC”). These documents
are available, free of charge, on the website of the SEC (xxx.xxx.xxx) and on the Company’s website
(xxx.xxx.xxx, under Investor Relations/ Regulatory Filings), as soon as reasonably practicable
after the material is filed with, or furnished to, the SEC. Any of these documents are available
to the Employee in paper format, without charge, upon written or oral request to the Company’s
Investor Relations Department located at 0000 Xxxxxxxxxxx Xxxx, Xxxxx 000, Xxxxx, Xxxxxxxx 00000,
U.S.A., phone number (000) 000-0000.
7.6. Counterparts. This Agreement may be executed in two counterparts each of which
shall be deemed an original and both of which together shall constitute one and the same
instrument.
Accepted this day of
, 2010
, 2010
| Appendix A to SXC Health Solutions Corp. Restricted Stock Unit Award Agreement for Employees |
For purposes of this Agreement “Change in Control” shall mean:
(1) the acquisition by any individual, entity or group (a “Person”), including any “person”
within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), of beneficial ownership within the meaning of Rule 13d-3 promulgated
under the Exchange Act, of more than 50% of either (i) the then outstanding shares of common stock
of the Company (the “Outstanding Company Common Stock”) or (ii) the combined voting power of the
then outstanding securities of the Company entitled to vote generally in the election of directors
(the “Outstanding Company Voting Securities”); provided, however, that the
following acquisitions shall not constitute a Change in Control: (A) any acquisition directly from
the Company (excluding any acquisition resulting from the exercise of a conversion or exchange
privilege in respect of outstanding convertible or exchangeable securities unless such outstanding
convertible or exchangeable securities were acquired directly from the Company), (B) any
acquisition by the Company, (C) any acquisition by an employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation controlled by the Company or (D) any
acquisition by any corporation pursuant to a reorganization, merger or consolidation involving the
Company, if, immediately after such reorganization, merger or consolidation, each of the conditions
described in clauses (i), (ii) and (iii) of subsection (3) of this Appendix A shall be satisfied;
and provided further that, for purposes of clause (B), if any Person (other than
the Company or any employee benefit plan (or related trust) sponsored or maintained by the Company
or any corporation controlled by the Company) shall become the beneficial owner of more than 50%
of the Outstanding Company Common Stock or more than 50% of the Outstanding Company Voting
Securities by reason of an acquisition by the Company and such Person shall, after such acquisition
by the Company, become the beneficial owner of any additional shares of the Outstanding Company
Common Stock or any additional Outstanding Company Voting Securities and such beneficial ownership
is publicly announced, such additional beneficial ownership shall constitute a Change in Control;
(2) individuals who, as of the date hereof, constitute the Board (the “Incumbent Board”) cease
for any reason to constitute at least a majority of such Board; provided, however,
that any individual who becomes a director of the Company subsequent to the date hereof whose
election, or nomination for election by the Company’s shareholders, was approved by the vote of at
least a majority of the directors then comprising the Incumbent Board shall be deemed to have been
a member of the Incumbent Board; and provided further, that no individual who was
initially elected as a director of the Company as a result of an actual or threatened solicitation
by a Person other than the Board for the purpose of opposing a solicitation by any other Person
with respect to the election or removal of directors or any other actual or threatened solicitation
of proxies or consents by or on behalf of any Person other than the Board shall be deemed to have
been a member of the Incumbent Board;
(3) consummation of a reorganization, merger or consolidation unless, in any such case,
immediately after such reorganization, merger or consolidation, (i) 50% or more of the then
outstanding shares of common stock of the corporation resulting from such reorganization, merger or
consolidation and 50% or more of the combined voting power of the then outstanding securities of
such corporation entitled to vote generally in the election of directors is then beneficially
owned, directly or indirectly, by all or substantially all of the individuals or entities who were
the beneficial owners, respectively, of the Outstanding Company Common Stock and the Outstanding
Company Voting Securities immediately prior to such reorganization, merger or consolidation and in
substantially the same proportions relative to each other as their ownership, immediately prior to
such reorganization, merger or consolidation, of the Outstanding Company Common Stock and the
Outstanding Company Voting Securities, as the case may be, (ii) no Person (other than the Company,
any employee benefit plan (or related trust) sponsored or maintained by the Company or the
corporation resulting from such reorganization, merger or consolidation (or any corporation
controlled by the Company) and any Person which beneficially owned, immediately prior to such
reorganization, merger or consolidation, directly or indirectly, more than 50% of the Outstanding
Company Common Stock or the Outstanding Company Voting Securities, as the case may be) beneficially
owns, directly or indirectly, more than 50% of the then outstanding shares of common stock of such
corporation or more than 50% of the combined voting power of the then outstanding securities of
such corporation entitled to vote generally in the election of directors and (iii) at least a
majority of the members of the board of directors of the corporation resulting from such
reorganization, merger or consolidation were members of the Incumbent Board at the time of the
execution of the initial agreement or action of the Board providing for such reorganization,
merger or consolidation; or
(4) consummation of (i) a plan of complete liquidation or dissolution of the Company or (ii)
the sale or other disposition of all or substantially all of the assets of the Company other than
to a corporation with respect to which, immediately after such sale or other disposition, (A) 50%
or more of the then outstanding shares of common stock thereof and 50% or more of the combined
voting power of the then outstanding securities thereof entitled to vote generally in the election
of directors is then beneficially owned, directly or indirectly, by all or substantially all of the
individuals and entities who were the beneficial owners, respectively, of the Outstanding Company
Common Stock and the Outstanding Company Voting Securities immediately prior to such sale or other
disposition and in substantially the same proportions relative to each other as their ownership,
immediately prior to such sale or other disposition, of the Outstanding Company Common Stock and
the Outstanding Company Voting Securities, as the case may be, (B) no Person (other than the
Company, any employee benefit plan (or related trust) sponsored or maintained by the Company or
such corporation (or any corporation controlled by the Company) and any Person which beneficially
owned, immediately prior to such sale or other disposition, directly or indirectly, more than 50%
of the Outstanding Company Common Stock or the Outstanding Company Voting Securities, as the case
may be) beneficially owns, directly or indirectly, more than 50% of the then outstanding shares of
common stock thereof or more than 50% of the combined voting power of the then outstanding
securities thereof entitled to vote generally in the election of directors and (C) at least a
majority of the members of the board of directors thereof were members of the Incumbent Board at
the time of the execution of the initial agreement or action of the Board providing for such sale
or other disposition.
Long-Term Incentive Plan
BENEFICIARY DESIGNATION FORM
You may designate a primary beneficiary and a secondary beneficiary. You can name more than
one person as a primary or secondary beneficiary. For example, you may wish to name your spouse as
primary beneficiary and your children as secondary beneficiaries. Your secondary beneficiary(ies)
will receive nothing if any of your primary beneficiaries survive you. All primary beneficiaries
will share equally unless you indicate otherwise. The same rule applies for secondary
beneficiaries.
Designate Your Beneficiary(ies):
Primary
Beneficiary(ies):
Secondary Beneficiary(ies):
I certify that my designation of beneficiary set forth above is my free act and deed.
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