AMTRUST FINANCIAL SERVICES, INC.
Exhibit
10.5
2010 OMNIBUS INCENTIVE
PLAN
RESTRICTED STOCK UNIT
AGREEMENT
AmTrust
Financial Services, Inc. a Delaware corporation, (the “Company”),
hereby grants restricted stock units (“RSUs”)
relating to shares of its common stock, $.01 par value, (the “Stock”),
to the individual named below as the Grantee, subject to the vesting conditions
set forth in this Agreement. This grant is subject to the terms and conditions
set forth in (i) this Agreement, and (ii) the 2010 Omnibus Incentive
Plan (the “Plan”).
Unless otherwise, defined herein, capitalized terms used in this Agreement are
defined in the Plan, and have the meaning set forth in the Plan.
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Award
of RSUs
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You
have been granted ________ RSUs, subject to the terms and conditions of
this Agreement and the Plan.
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Grant
Date
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The
effective date of this grant of RSUs is _______ ____, 20__ (“Grant
Date”).
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Vesting
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RSUs
shall vest in four equal installments of 25% on each of the first, second,
third and fourth anniversaries of the Grant Date, provided you remain in
Service (as defined below) on the vesting date.
“Service”
means that you are currently an employee of the Company, are a member of
the Company’s Board of Directors, or are otherwise providing services to
the Company.
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RSU
Transferability
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RSUs
may not be transferred, assigned, pledged or hypothecated, whether by
operation of law or otherwise, nor may the RSUs be made subject to
execution, attachment or similar process.
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Forfeiture
of Unvested
RSUS
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Except
as specifically provided in this Agreement or as may be provided in other
agreements between you and the Company, no additional RSUs will vest after
your Service has terminated for any reason and you will forfeit to the
Company all of the RSUs that have not yet vested or with respect to which
all applicable restrictions and conditions have not lapsed.
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Death
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If
your Service terminates because of your death, the RSUs granted under this
Agreement will automatically vest as to the number of RSUs that would have
vested had you remained in Service for the 12 month period
immediately following your death.
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Disability
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If
your Service terminates because of your Disability (as defined below), the
RSUs granted under this Agreement will automatically vest as to the number
of RSUs that would have vested had you remained in Service for the
12 month period immediately following your termination for
Disability.
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For
purposes of this Agreement, “Disability”
shall mean the Award holder is unable to perform the duties of their
Service (or other services) (i) for a period of 90 consecutive days, or
(ii) any 120 days during any consecutive 12 month period.
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Termination
For Cause
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If
your Service is terminated for Cause (as defined below), then you shall
immediately forfeit all rights to your vested (but undelivered) and
unvested RSUs and this award shall immediately terminate.
For
purposes of this Agreement, “Cause”
shall mean (a) willful misconduct or gross negligence; (b) conviction of a
felony or conviction of a crime involving moral turpitude; (c) any act
constituting fraud or the misappropriation or embezzlement of money or
other property of any member of the Company; and (d) any willful act or
course of conduct constituting an abuse of office or authority which has a
material adverse impact on the Company’s reputation or financial
condition.
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Termination
without Cause within 12 Months of Change in Control
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If
your Service with the Company (or any affiliate) is terminated by the
Company without Cause within 12 months following the effective date of a
“Change of Control,” the Board of Directors may accelerate the vesting of
all or any portion of this RSUs award.
For
purposes of this Agreement: “Change
in Control” shall mean:
(i)
any “person” (as such term is used in Section 13(d) and 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the “Exchange
Act”), including any syndicate or group deemed to be a “person”
under Section 13(d)(3) of the Exchange Act) other than Xxxxx Xxxxxxx,
Xxxxxx Xxxxxxxxx, Xxxxxxx Xxxxxxxxx, any subsidiary or any employee
benefit plan of the Company or a subsidiary or former subsidiary, is or
becomes a beneficial owner, directly or indirectly, of stock of the
Company representing 50% of more of the total voting power of the
Company’s then outstanding stock;
(ii)
a tender offer (for which a filing has been made with the Securities and
Exchange Commission (the “SEC”)
that purports to comply with the requirements of Section 14(d) of the
Exchange Act, and the corresponding SEC rules) is made for the stock of
the Company. In case of a tender offer described in this paragraph (ii),
the “Change of Control” will be deemed to have occurred upon the first to
occur of (A) any time during the offer when the person (using the
definition in (i) above) making the offer owns or has accepted for payment
stock of the Company with 50% or more of the total voting power of the
Company's outstanding stock or (B) three business days before the offer is
to terminate unless the offer is withdrawn first, if the person making the
offer could own, by the terms of the offer plus any shares owned by this
person, stock with 50% or more of the total voting power of the Company's
outstanding stock when the offer terminates;
or
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(iii) individuals
who were the Board’s nominees for election as directors of the Company
immediately prior to a meeting of the stockholders of the Company
involving a contest for the election of directors shall not constitute a
majority of the Board following the election.
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Share
Delivery Pursuant to Vested Units; Withholding Tax
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On
the vesting date (or as soon as practicable thereafter but in no event
beyond 2½ months after the end of the calendar year in which the shares
vest), at the Company’s option, (i) a brokerage account in your name will
be credited with Stock representing the number of shares that vested under
this grant (the “Vesting
Shares”), or (ii) the Company shall physically deliver the Vesting
Shares. If the vesting date is not a trading day, the Stock will be
delivered on the next trading day. The Company will determine the number
of the Vesting Shares necessary to cover the statutory minimum amount of
federal, state, local, and foreign taxes that the Company is required to
withhold with respect to the RSU vesting, rounding up to the nearest whole
Share of Stock (the “Withholding
Shares”).
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By
accepting this award of RSUs, you irrevocably (i) instruct the
Company to deliver the Vesting Shares to your account; and
(ii) authorize and direct the broker, to sell, on your behalf, the
Withholding Shares at the market price per share at the time of such sale
and to deliver the proceeds to the Company to be used to fund the payment
of the withholding taxes. You further acknowledge that this irrevocable
written instruction is intended to constitute an instruction pursuant to
Rule 10b5-1 of the Exchange Act. The Company shall be responsible for
the payment of any brokerage commissions relating to the sale of the
Withholding Shares.
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You
acknowledge that until the first trading day following the broker’s sale
of the Withholding Shares, you shall not be entitled to effect
transactions in the net Vesting Shares, if credited to your brokerage
account.
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The
purchase price for the vested Stock is deemed paid by your prior services
to the Company.
Withholding
shall only be applicable to employees of the Company.
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Recapture
Rights
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In
the event that you violate any of your obligations pursuant to the
Confidentiality, Non-Competition, or Non-Solicitation provisions of this
Agreement, you agree to return to the Company, within five days of receipt
of written demand from the Company, any gains you realize from the sale of
all or any portion of the RSUs during the 12 months immediately preceding
such violation, and any remaining unsold portion of your RSUs shall be
immediately and totally
forfeited.
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Confidentiality
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During
your Service, you will have access to confidential or proprietary data or
information of the Company (and its affiliates) and its
operations. You agree that you will not at any time divulge or
communicate the Confidential Information (defined below) to any person,
nor shall you direct any employee to divulge or communicate to any person
(other than to a person bound by confidentiality obligations similar to
those contained herein and other than as necessary in performing your
duties hereunder), or use to the detriment of the Company (or any of its
affiliates) or for the benefit of any other person, any Confidential
Information. This restriction shall survive your Service
hereunder, whether by the normal expiration thereof or
otherwise.
The
term “Confidential
Information” shall mean all information, whether or not reduced to
written or recorded form, that is related to the Company and that is not
generally known or accessible to members of the public and/or competitors
of the Company nor intended for general dissemination, whether furnished
by the Company or compiled by the employee, including, without limitation,
relating to the Company’s (or any affiliate’s) financial performance,
customers, existing or proposed future projects, prospects, or business
strategies, personnel information, financial information, customer lists,
supplier lists, trade secrets, information regarding operations, systems,
services, know-how, computer and any other processed or collated data,
computer programs, pricing, marketing and advertising data.
You
understand the Company intends to maintain the confidentiality of the
Confidential Information notwithstanding that employees of the Company may
have free access to the information for the purpose of performing their
duties with the Company, and notwithstanding that employees not expressly
bound by agreements similar to this agreement may have access to such
information for job purposes. You acknowledge that Confidential
Information need not be marked as such to preserve the confidential nature
of the information.
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Non-Competition
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You
acknowledge that (a) in the course of your Service with the Company and
its affiliates, you have, and will continue to, become familiar with the
Company’s and its affiliates’ trade secrets, methods of doing business,
business plans and other valuable confidential and proprietary information
concerning the Company, its affiliates, their customers and business
partners and that your services have been and will be of special, unique
and extraordinary value to the Company and its affiliates. In
consideration thereof and of this Award, during your Service with the
Company or an affiliate and for a period of one (1) year thereafter, you
shall not, without the Company’s prior written approval, become engaged,
directly or indirectly, as a director, officer, employee or 5% or more
stockholder or equity interest owner in, partner in, or consultant to, any
business that is directly competitive with the business of the Company (or
any affiliate) in any area or region where the Company (or any affiliate)
conducts business (“Competition”).
Notwithstanding the foregoing, you shall not be deemed to be in
Competition with the Company if you provide evidence satisfactory to the
Company, in its sole and absolute discretion, that you: (i) work in a
separate division, department or unit that does not compete with the
business of the Company (or any affiliate); and (ii) will not have contact
with the division, department or unit that does compete with the business
of the Company (or any affiliate). If you received your RSU grant as
a non-employee member of the Company’s Board of Directors, this provision
will not apply to you unless your Service is terminated for Cause (as
defined above) or for cause pursuant to the Company’s Certificate of
Incorporation.
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Non-Solicitation
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During
Service and for a period of two (2) years thereafter, you shall not,
directly or indirectly, on your own behalf or on behalf of any other
person: (a) induce or attempt to induce any agent, affinity group or
policyholder of the Company (or any affiliate), or any prior agent,
affinity group or policyholder that was an agent, affinity group or
policyholder within twelve (12) months of such contact, to withdraw,
decrease or cancel its business with the Company (or any affiliate) or
otherwise terminate any written or oral agreement or understanding or
other relationship with the Company (or any affiliate); (b) solicit the
business of any customer of the Company (or any affiliate), or any prior
agent, affinity group or policyholder that was an agent, affinity group or
policyholder within twelve (12) months of such contact, to the extent the
business solicited is similar to, or competitive with, the business of the
Company (or any affiliate); (c) solicit or attempt to solicit, or hire or
attempt to hire, any person who is an employee, individual consultant or
independent contractor of the Company (or any affiliate), or any prior
employee, individual consultant or independent contractor that was an
employee, consultant or independent contractor within twelve (12) months
of such contact; or (d) induce or attempt to induce any person who is an
employee, individual consultant or independent contractor of the Company
(or any affiliate) to terminate or limit his or her Service or other
relationship with the Company (or any affiliate), or any prior employee,
individual consultant or independent contractor that was an employee,
individual consultant or independent contractor within twelve (12) months
of such contact.
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No Right to
Employment
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Neither
your RSUs nor this Agreement give you the right to be retained by the
Company in any capacity and your Service may be terminated at any time and
for any reason.
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Shareholder
Rights
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You
have no rights as a shareholder unless and until the Stock relating to the
RSUs has been issued to you (or an appropriate book entry has been made).
Except as described in the Plan or herein, no adjustments are made for
dividends or other rights if the applicable record date occurs before your
Stock is issued (or an appropriate book entry has been made).
You
will not be entitled to any dividends on any unvested RSUs.
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Applicable
Law
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This
Agreement shall be governed by the laws of the State of Delaware, with
consent to jurisdiction by you in the State of New
York.
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Data
Privacy
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To
administer the Plan, the Company may process personal data about you. Such
data includes the information provided in this Agreement, other
appropriate personal and financial data about you such as home address and
business addresses and other contact information, payroll information and
any other information deemed appropriate by the Company to facilitate the
administration of the Plan.
By
accepting this award, you consent to the Company’s processing of such
personal data and the transfer of such data outside the country in which
you work or are employed, including, with respect to non-U.S. residents,
to the United States, to transferees who shall include the Company and
other persons designated by the Company to administer the Plan and the
Plan prospectus.
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Consent to
Electronic
Delivery
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Certain
statutory materials relating to the Plan may be delivered to you in
electronic form. By accepting this grant, you consent to electronic
delivery and acknowledge receipt of these materials, including the
Plan.
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This
Agreement is not a stock certificate or a negotiable instrument.
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By
accepting your grant, you agree to the terms and conditions in this Agreement
and in the Plan, and agree that the Plan will control in the event any provision
of this Agreement should appear to be inconsistent with the terms and conditions
of the Plan.
IN WITNESS WHEREOF, the parties have
executed this Agreement on the date and year below.
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By:
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Its:
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Date:
___________________________
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EMPLOYEE
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Date:____________________________
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Name:
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