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EXHIBIT 10.03
RESTRICTED SHARES AGREEMENT
Cardinal Health, Inc., an Ohio corporation (the "Company"), has
granted to _________________ (the "Grantee"), ______ Common Shares in the
Company (the "Restricted Shares"). The Restricted Shares have been granted
pursuant to the Cardinal Health, Inc. Equity Incentive Plan (the "Plan") and
shall be subject to all provisions of the Plan, which are hereby incorporated
herein by reference, and shall be subject to the provisions of this agreement.
Capitalized terms used herein which are not specifically defined herein shall
have the meanings ascribed to such terms in the Plan.
1. Vesting. The Restricted Shares shall vest in accordance with the
following schedule (which dates shall be "Vesting Date(s)"):
Vesting Date % of Restricted Shares
------------ ----------------------
%
%
%
----
Total 100%
2. Purchase Price. The purchase price of the Restricted Shares shall be
$-0-.
3. Transferability. Prior to the applicable Vesting Date(s) (the
"Restriction Period"), the Grantee shall not be permitted to sell, transfer,
pledge, assign or otherwise encumber the Restricted Shares, except as otherwise
provided in Section 4 of this agreement. The Restricted Shares will be held by
the Company; provided, however, that the Company will deliver certificates
representing these Restricted Shares which have fully vested to the Grantee
within a reasonable time after being requested in writing to do so.
4. Termination of Service. Unless otherwise determined by the Committee
at or after grant or termination, and except as set forth below, if the
Grantee's Continuous Service to the Company and its subsidiaries (collectively,
the "Cardinal Group") terminates during the Restriction Period, all of the
Restricted Shares that have not vested shall be forfeited by the Grantee. If the
Grantee's Continuous Service terminates prior to the vesting of all of the
Restricted Shares by reason of the Grantee's death or total or partial
disability, then the restrictions with respect to a ratable portion of the
Restricted Shares shall lapse and such shares shall not be forfeited. Such
ratable portion shall be determined with respect to each separate award of
Restricted Shares and shall be an amount equal to (i) the number of Restricted
Shares awarded to the Grantee multiplied by the portion of the Restriction
Period that has expired at the date of the Grantee's death or total or partial
disability, reduced by (ii) the number of Restricted Shares awarded with respect
to which the restrictions had lapsed as of the date of the death or total or
partial disability of the Grantee. For purposes of this agreement, the term
"Continuous Service" shall mean the absence of any interruption or termination
of service as an employee or director of any entity within the Cardinal Group.
5. Triggering Conduct/Competitor Triggering Conduct. As used in this
agreement, "Triggering Conduct" shall include disclosing or using in any
capacity other than as necessary in the performance of duties assigned by the
Cardinal Group any confidential information or material concerning the Cardinal
Group; violation of Company policies, including conduct which would constitute a
breach of the then-most recent version of the Certificate of Compliance with
Company Policies signed by the Grantee;
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directly or indirectly employing, contacting concerning employment, or
participating in any way in the recruitment for employment (whether as an
employee, officer, director, agent, consultant or independent contractor) any
person who was or is at any time during the previous twelve months an employee,
representative, officer, or director of the Cardinal Group; and breaching any
provision of any employment or severance agreement with a member of the Cardinal
Group. As used herein, "Competitor Triggering Conduct" shall include accepting
employment with or serving as a consultant, advisor, or in any other capacity to
an entity that is in competition with the business conducted by any member of
the Cardinal Group (a "Competitor") either during or within one year following
Grantee's termination of employment with the Cardinal Group ("Competitor
Triggering Conduct"). The Committee shall resolve in good faith any disputes
concerning whether particular conduct constitutes Triggering Conduct or
Competitor Triggering Conduct, and any such determination by the Committee shall
be conclusive and binding on all interested persons.
6. Special Forfeiture/Repayment Rules. For so long as Grantee continues
as an employee with the Cardinal Group and for three years following Grantee's
termination of employment with the Cardinal Group, Grantee agrees not to engage
in Triggering Conduct. If Grantee engages in such Triggering conduct or in
Competitor Triggering Conduct during such time, then: (a) the Restricted Shares
(or any part thereof that have not vested) shall immediately and automatically
terminate, be forfeited, and shall cease to vest at any time; and (b) the
Grantee shall, within 30 days following written notice from the Company, pay to
the Company an amount equal to the gross gain realized or obtained by the
Grantee resulting from the vesting of such Restricted Shares, measured at the
date of vesting (i.e., the market value of the Restricted Shares on the vesting
date), with respect to any portion of the Restricted Shares that has already
vested at any time within three years prior to the Triggering Conduct (the
"Look-Back Period"), less $1.00. If Grantee engages only in Competitor
Triggering Conduct, then the Look-Back Period shall be shortened to exclude any
period more than one year prior to Grantee's termination of employment with the
Cardinal Group. The Grantee may be released from Grantee's obligations under
this item 6 only if the Committee (or its duly appointed agent) determines, in
writing and in its sole discretion, that such action is in the best interests of
the Company. Nothing in this item 6 constitutes a so-called "noncompete"
covenant. However, this item 6 does prohibit certain conduct while Grantee is
associated with the Cardinal Group and thereafter and does provide for the
forfeiture or repayment of the benefits granted by this agreement under certain
circumstances, including but not limited to the Grantee's acceptance of
employment with a Competitor. Grantee agrees to provide the Company with at
least ten days written notice prior to directly or indirectly accepting
employment with or serving as a consultant, advisor, or in any other capacity to
a Competitor, and further agrees to inform any such new employer, before
accepting employment, of the terms of this item 6 and the Grantee's continuing
obligations contained herein. No provision of this agreement shall diminish,
negate, or otherwise impact any separate noncompete agreement to which Grantee
may be a party. Grantee acknowledges and agrees that the provisions contained in
this item 6 are being made for the benefit of the Company in consideration of
Grantee's receipt of the Restricted Shares, in consideration of employment, in
consideration of exposing Grantee to the Company's business operations and
confidential information, and for other good and valuable consideration, the
adequacy of which consideration is hereby expressly confirmed. Grantee further
acknowledges that the receipt of the Restricted Shares and execution of this
agreement are voluntary actions on the part of Grantee, and that the Company is
unwilling to provide the Restricted Shares to Grantee without including this
item 6.
7. Right of Set-Off. By accepting these Restricted Shares, the Grantee
consents to a deduction from and set-off against any amounts owed to the Grantee
by any member of the Cardinal Group from time to time (including but not limited
to amounts owed to the Grantee as wages, severance
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payments, or other fringe benefits) to the extent of the amounts owed to the
Cardinal Group by the Grantee under this agreement.
8. Shareholder Rights and Restrictions. Except with regard to the
disposition of Restricted Shares, the Grantee shall generally have all rights of
a shareholder with respect to the Restricted Shares from the date of grant,
including, without limitation, the right to receive dividends with respect to
such Restricted Shares and the right to vote such Restricted Shares, but
subject, however, to those restrictions in this agreement or in the Plan.
9. Withholding Tax. The Company shall have the right to require the
Grantee to pay to the Company the amount of any taxes which the Company is
required to withhold with respect to the Restricted Shares (including the amount
of any taxes which the Company is required to withhold with respect to dividends
on the Restricted Shares) or, in lieu thereof, to retain, or sell without
notice, a sufficient number of Restricted Shares to cover the amount required to
be withheld.
10. Governing Law/Venue. This agreement shall be governed by the laws
of the State of Ohio, without regard to principles of conflicts of law, except
to the extent superseded by the laws of the United States of America. In
addition, all legal actions or proceedings relating to this agreement shall be
brought in state or federal courts located in Franklin County, Ohio, and the
parties executing this agreement hereby consent to the personal jurisdiction of
such courts. Grantee acknowledges that the covenants contained in items 5 and 6
of this agreement are reasonable in nature, are fundamental for the protection
of the Company's legitimate business and proprietary interests, and do not
adversely affect the Grantee's ability to earn a living in any capacity that
does not violate such covenants. The parties further agree that, in the event of
any violation by Grantee of any such covenants, the Company will suffer
immediate and irreparable injury for which there is no adequate remedy at law.
In the event of any violation or attempted violations of item 5 or 6 of this
agreement, the Company shall be entitled to specific performance and injunctive
relief or other equitable relief without any showing of irreparable harm or
damage, and Grantee hereby waives any requirement for the securing or posting of
any bond in connection with such remedy, without prejudice to the rights and
remedies afforded the Company hereunder or by law. In the event that it becomes
necessary for the Company to institute legal proceedings under this agreement,
Grantee shall be responsible to the Company for all costs and reasonable legal
fees incurred by the Company with regard to such proceedings. Any provision of
this agreement which is determined by a court of competent jurisdiction to be
invalid or unenforceable should be construed or limited in a manner that is
valid and enforceable and that comes closest to the business objectives intended
by such provision, without invalidating or rendering unenforceable the remaining
provisions of this agreement.
11. Prompt Acceptance of Agreement. The Restricted Shares grant
evidenced by this agreement shall, at the discretion of the Committee, be
forfeited if this agreement is not executed by the Grantee and returned to the
Company within sixty days of the Grant Date set forth below.
CARDINAL HEALTH, INC.
DATE OF GRANT:__________________ By:_______________________________
Xxxxxx Xxxx Xxxxxxx
Executive Vice President
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ACCEPTANCE OF AGREEMENT
The Grantee hereby: (a) acknowledges that he has received a copy
of the Plan, a copy of the Company's most recent Annual Report and other
communications routinely distributed to the Company's shareholders, and a copy
of the Plan Description dated March 1, 1999, pertaining to the Plan; (b) accepts
this Agreement and the Restricted Shares granted to him under this Agreement
subject to all provisions of the Plan and this Agreement; (c) represents and
warrants to the Company that he is purchasing the Restricted Shares for his own
account, for investment, and not with a view to or any present intention of
selling or distributing the Restricted Shares either now or at any specific or
determinable future time or period or upon the occurrence or nonoccurrence of
any predetermined or reasonably foreseeable event; and (d) agrees that no
transfer of the Restricted Shares shall be made unless the Restricted Shares
have been duly registered under all applicable Federal and state securities laws
pursuant to a then-effective registration which contemplates the proposed
transfer or unless the Company has received a written opinion of, or
satisfactory to, its legal counsel that the proposed transfer is exempt from
such registration:
________________________________
Grantee's Signature
________________________________
Grantee's Social Security Number
________________________________
Date
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