Exhibit 10.3
Global Signal Inc.
Restricted Shares Award Agreement
This Restricted Shares Award Agreement (the "Agreement"), executed as of April
9, 2006, is entered into by and between Global Signal Inc., a Delaware
Corporation with its principal office at 000 Xxxxx Xxxxxxxxx Xxxx, Xxxxx 000,
Xxxxxxxx, Xxxxxxx 00000 (the "Corporation"), and Xxxxx X. Xxxxxxx (the
"Employee").
WHEREAS, the Corporation has established the Global Signal Inc. Omnibus Stock
Incentive Plan (the "Plan"), a copy of which may be obtained by written or
telephonic request to the Corporation's Secretary, and which Plan is made a part
hereof;
WHEREAS, the Employee is a valued and trusted employee of the Corporation and
the Corporation believes it to be in the best interests of the Corporation to
secure the future services of the Employee by providing the Employee with an
inducement to remain an employee of the Corporation or any of its affiliates or
subsidiaries and through the grant of shares of common stock, par value $0.01
per share, of the Corporation (the "Common Stock"); and
WHEREAS, on April 10, 2006 (the "Grant Date") the Compensation Committee of the
Board of Directors of the Corporation determined that the Employee be granted
shares of the Common Stock subject to the restrictions stated below and as
hereinafter set forth, effective upon the later of the execution by Employee of
an employment agreement ("Employment Agreement") with Global Signal Services LLC
subsidiaries and the first day of Employee's employment with Global Signal
Services LLC ("Effective Date");
NOW, THEREFORE, in consideration of the covenants and promises contained herein,
and for other good and valuable consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties hereby agree as follows:
1) Grant of Stock. Pursuant to Section 9 of the Plan, and subject to the terms
and conditions of this Agreement and of the Plan, the Corporation hereby
grants to the Employee two hundred thousand (200,000) shares of Common
Stock, effective as of the Effective Date (the "Restricted Stock"). As more
fully described below, the Restricted Stock granted hereby is subject to
forfeiture by the Employee if certain criteria are not satisfied.
2) Vesting Schedule. The Corporation shall cause each certificate for
Restricted Stock to be issued in Employee's name and such shares shall be
fully paid and nonassessable and free from preemptive rights. The interest
of the Employee in the Restricted Stock shall vest as to twenty percent
(20%) such Restricted Stock on the Effective Date, and as to one-fourth of
the remaining portion, or an additional twenty percent (20%), beginning on
December 31, 2007, and on each succeeding December 31, so as to be 100%
vested on December 31, 2010, conditioned upon the Employee's continued
employment with the Corporation as of each vesting date. Notwithstanding
the foregoing, the interest of the Employee in the Restricted Stock shall
vest as to:
a) An additional 20% of the Restricted Stock subject to this Grant upon
a termination of the Employee's employment (i) by the Corporation
other than for "Cause" or (ii) by the Employee for "Good Reason"
("Cause" and "Good Reason" each, as defined in the Employee's
Employment Agreement with Global Signal Services LLC), (it being
understood that the remainder of the Restricted Stock shall be
forfeited to the Company in connection with any such termination of
employment); or
b) 100% of the then unvested Restricted Stock in the event of a "Change
in Control" (as defined in Exhibit I to the Employment Agreement);
or
c) 100% of the then unvested Restricted Stock in the even of the
Employee's death or, if, as provided in Section 4(g)(v) of the
Employment Agreement, the Employee is determined to be Disabled. For
purposes of this Agreement, the Employee will be considered
"Disabled" or to have incurred a "Disability" if he is "disabled" as
provided in Section 4(g)(v) of the Employee's Employment Agreement
with Global Signal Services LLC.
In the event Employee is a "specified employee" within the meaning of
Section 409A(a)(2)(B)(i) of the Code, the vesting of the Restricted Stock
shall be delayed in accordance with the provisions of such section to the
extent necessary or appropriate to avoid adverse tax consequences under
Section 409A of the Code.
3) Restrictions.
a) The Restricted Stock or rights granted hereunder may not be sold,
pledged or otherwise transferred until the Restricted Stock becomes
vested in accordance with Section 2. The period of time between the
date hereof and the date Restricted Stock becomes vested, with
respect to each portion of the Restricted Stock, is referred to
herein as the "Restricted Period."
b) If the Employee's employment with the Corporation is terminated for
any reason, the Restricted Stock subject to the provisions of this
Agreement which have not vested at the time of the Employee's
termination of employment pursuant to Section 2 of this Agreement
and the provisions of the Employment Agreement shall be forfeited by
the Employee, and ownership transferred back to the Corporation.
4) Legend. All certificates representing any shares of Stock of the
Corporation subject to the provisions of this Agreement shall have
endorsed thereon the following legend:
THE SHARES REPRESENTED BY THIS STOCK CERTIFICATE HAVE BEEN GRANTED AS RESTRICTED
STOCK. WITHOUT THE PRIOR WRITTEN CONSENT OF THE CORPORATION, THE SHARES
REPRESENTED BY THIS STOCK CERTIFICATE MAY NOT BE SOLD, TRANSFERRED, PLEDGED, OR
ASSIGNED OR OTHERWISE ENCUMBERED OR DISPOSED OF UNLESS THE RESTRICTIONS SET
FORTH IN THE UNVESTED STOCK AWARD AGREEMENT BETWEEN THE REGISTERED HOLDER OF
THESE SHARES AND THE CORPORATION SHALL HAVE LAPSED.
The Corporation may endorse such legend or legends upon the stock
certificates for Restricted Stock and may issue such "stop transfer"
instructions to its transfer agent in respect of such Restricted Stock 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 of 1933, as amended; and (ii) implement
the provisions of the Agreement and any agreement between the Corporation
and the Employee.
5) Escrow. Upon execution of this Agreement, the certificate or certificates
evidencing the Restricted Stock subject hereto together with the stock
power, attached hereto as Exhibit A, shall be delivered to and deposited
with the Secretary of the Corporation as Escrow Agent in this transaction.
Such certificates are to be held by the Escrow Agent until termination of
the Restricted Period, when they shall be released by said Escrow Agent to
the Employee. The Corporation shall serve as attorney-in-fact for the
Employee during the Restricted Period, with full power and authority in the
Employee's name to assign and convey to the Corporation any Restricted
Stock held by the Corporation for the Employee if the Employee forfeits the
Restricted Stock under the terms of this Agreement. Upon the vesting of the
Restricted Stock, the Corporation shall so notify the Secretary of the
Corporation and the Secretary shall obtain from the Corporation stock
certificates representing all such shares that have vested, which stock
certificates shall not bear any restrictive endorsement making reference to
this Agreement, and shall promptly issue and deliver such stock
certificates, if any, to the Employee.
6) Employee Shareholder Rights. During the Restricted Period, the Employee
shall have all the rights of a shareholder with respect to the Restricted
Stock except for the right to transfer the Restricted Stock, as set forth
in Section 3. Accordingly, the Employee shall have the right to vote the
Restricted Stock and to receive any dividends paid to or made with respect
to the Restricted Stock.
7) Permanent and Total Disability of Employee. In the event of the Disability
of the Employee, all vested Restricted Stock shall be delivered to the
Employee if legally competent or to a legally designated guardian or
representative if the Employee is legally incompetent.
8) Death of Employee. In the event of the Employee's death after any vesting
date but prior to the delivery to Employee in accordance with Section 5
above of certificates representing the shares which have vested,
certificates representing such shares shall be delivered to the Employee's
estate or designated beneficiary.
9) Taxes. Notwithstanding anything to the contrary, the release of the shares
of Restricted Stock hereunder shall be conditioned upon Employee making
adequate provision for federal, state or other withholding obligations, if
any, which may arise upon the vesting of the Restricted Stock.
Set forth below is a brief summary as of the Grant Date of certain United
States federal tax consequences of the award of Restricted Stock. THIS
SUMMARY DOES NOT ADDRESS SPECIFIC STATE, LOCAL OR FOREIGN TAX CONSEQUENCES
THAT MAY BE APPLICABLE TO THE EMPLOYEE. THE EMPLOYEE UNDERSTANDS THAT THIS
SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE
SUBJECT TO CHANGE.
TO ENSURE COMPLIANCE WITH TREASURY DEPARTMENT REGULATIONS, WE ADVISE YOU
THAT, UNLESS OTHERWISE EXPRESSLY INDICATED, ANY FEDERAL TAX ADVICE
CONTAINED IN THIS RESTRICTED SHARES AWARD AGREEMENT WAS NOT INTENDED OR
WRITTEN TO BE USED, AND CANNOT BE USED, FOR THE PURPOSE OF (I) AVOIDING
TAX-RELATED PENALTIES UNDER THE CODE OR (II) PROMOTING, MARKETING OR
RECOMMENDING TO ANOTHER PARTY ANY TAX-RELATED MATTERS ADDRESSED HEREIN.
Unless the Employee has filed a Section 83(b) election as discussed below,
the Employee shall recognize ordinary income at the time or times the
Restricted Stock vests in an amount equal to the fair market value of such
shares on each such date.
The Employee hereby acknowledges that he or she has been informed that,
with respect to the grant of Restricted Stock, an election may be filed by
the Employee with the Internal Revenue Service, within 30 days of the Grant
Date, electing pursuant to Section 83(b) of the Internal Revenue Code of
1986, as amended (the "Code"), to be taxed currently on the fair market
value of the Restricted Stock as of the Grant Date.
THE EMPLOYEE ACKNOWLEDGES THAT IT IS THE EMPLOYEE'S SOLE RESPONSIBILTY AND
NOT THE CORPORATION'S TO FILE TIMELY THE ELECTION UNDER SECTION 83(b) OF
THE CODE, EVEN IF THE EMPLOYEE REQUESTS THE CORPORATION OR ITS
REPRESENTATIVE TO MAKE THIS FILING ON THE EMPLOYEE'S BEHALF.
BY SIGNING THIS AGREEMENT, THE EMPLOYEE REPRESENTS THAT HE OR SHE HAS
REVIEWED WITH HIS OR HER OWN TAX ADVISORS THE FEDERAL, STATE, LOCAL AND
FOREIGN TAX CONSEQUENCES OF THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT
AND THAT HE OR SHE IS RELYING SOLELY ON SUCH ADVISORS AND NOT ON ANY
STATEMENTS OR REPRESENTATIONS OF THE CORPORATION OR ANY OF ITS AGENTS. THE
EMPLOYEE UNDERSTANDS AND AGREES THAT HE OR SHE (AND NOT THE CORPORATION)
SHALL BE RESPONSIBLE FOR ANY TAX LIABILITY THAT MAY ARISE AS A RESULT OF
THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
10) Miscellaneous.
a) The Corporation shall not be required (i) to transfer on its books
any shares of Stock of the Corporation which shall have been sold or
transferred in violation of any of the provisions set forth in this
Agreement, or (ii) to treat as owner of such shares or to accord the
right to vote as such owner or to pay dividends to any transferee to
whom such shares shall have been so transferred.
b) The parties agree to execute such further instruments and to take
such action as may reasonably be necessary to carry out the intent
of this Agreement.
c) Any notice required or permitted hereunder shall be given in writing
and shall be deemed effectively given upon delivery to the Employee
at his or her address then on file with the Corporation.
d) Neither the Plan, the granting of this Restricted Shares Award, this
Restricted Shares Award Agreement nor any other action taken
pursuant to the Plan or this Restricted Shares Award Agreement shall
constitute or be evidence of any agreement or understanding, express
or implied, that the Employee has a right to continue to provide
services as an officer or employee of the Company or any Parent,
Subsidiary or affiliate of the Company for any period of time or at
any specific rate of compensation. Further, the Company may at any
time dismiss the Employee, free from any liability or any claim
under the Plan or this Restricted Shares Award Agreement, except as
otherwise expressly provided herein or in the Employment Agreement.
e) This Agreement and the Plan contain the entire understanding and
agreement of the parties concerning the subject matter hereof, and
supersede all earlier negotiations and understandings, whether
written or oral, between the parties with respect thereto. This
Agreement is made under and subject to the provisions of the Plan,
and all of the provisions of the Plan are hereby incorporated by
reference into this Agreement. In the event of any conflict between
the provisions of this Agreement and the provisions of the Plan, the
provisions of the Plan shall govern. By signing this Agreement, the
Employee confirms that he or she has received a copy of the Plan and
has had an opportunity to review the contents thereof.
Notwithstanding any provision of this Agreement to the contrary, in
the event that there is a conflict between this Agreement and the
Employment Agreement, the Employment Agreement shall control.
f) Any dispute regarding the interpretation of this Agreement shall be
submitted by Employee or the Corporation to the Corporation's Board
of Directors for review. The resolution of such a dispute by the
Corporation's Board of Directors shall be final and binding on the
Corporation and the Employee.
g) This Agreement shall be governed by, and construed and enforced in
accordance with, the laws of the State of Delaware applicable to
agreements wholly to be executed and to be performed therein. If any
one or more of the provisions of this Agreement shall be held to be
invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
h) Any dispute, claim, controversy or claim arising out of, relating to
or in connection with this Agreement, or the breach, termination or
validity thereof, shall be brought exclusively in any Federal or
State court in the State of New York, County of New York. Both
parties hereto expressly and irrevocably submit to the jurisdiction
of said courts and irrevocably waive any objection which either of
them may now or hereafter have to the laying of venue of any action,
suit or proceeding arising out of or relating to this Agreement
brought in such courts, irrevocably waive any claim that any such
action, suit or proceeding brought in any such court has been
brought in an inconvenient forum and further irrevocably waive the
right to object, with respect to such claim, action, suit or
proceeding brought in any such court, that such court does not have
jurisdiction over such party. The parties hereto hereby irrevocably
consent to the service of process by registered mail, postage
prepaid, or by personal service within or without the State of New
York. Nothing contained herein shall affect the right to serve
process in any manner permitted by law.
i) The Corporation 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 Corporation. Subject to the
restrictions on transfer set forth herein, this Agreement shall be
binding upon the Employee and Employee's heirs, executors,
administrators, legal representatives, successors and assigns.
j) Employee hereby acknowledges receipt of a copy of this Agreement.
Employee has read and understands the terms and provisions thereof,
and accepts the Restricted Stock subject to all the terms and
conditions of this Agreement.
k) This Restricted Shares Award Agreement shall not be effective unless
Employee executes and delivers a Non-Compete, Non-Solicitation and
Confidentiality Agreement in the form attached as Exhibit III to the
Employment Agreement.
IN WITNESS WHEREOF, the Corporation has caused this instrument to be executed by
a duly authorized officer and the Employee has hereunto affixed his or her hand
the day and year first above written.
Global Signal Inc.
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
Title: Chairman of the Board
Employee
/s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
EXHIBIT A
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STOCK POWER
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FOR VALUE RECEIVED, __________________________________________ ("Employee"),
hereby sells, assigns, transfers and conveys unto
_______________________________________________, ______________________ shares
of the Common Stock, par value $0.01 per share, of Global Signal Inc., a
Delaware corporation (the "Company"), standing in Employee's name on the books
of the Company represented by Certificate No. ________ herewith, and do hereby
irrevocably constitute and appoint ________________________________________
attorney to transfer the said stock on the books of the Company with full power
of substitution in the premises. The authority granted by this Stock Power shall
be limited (i) to the shares of Restricted Stock granted to Employee in
accordance with the Restricted Shares Award Agreement between the Company and
Employee, dated as of _____________________, 2006, to which this Stock Power is
"Exhibit A" (the "Agreement") and (ii) to exercise solely in the accordance with
the provisions of the Agreement, including Section 5 thereof.
By:
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Name:
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Dated:
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