BRADY CORPORATION PERFORMANCE-BASED RESTRICTED STOCK AGREEMENT (January 8, 2008)
Exhibit 10.1
XXXXX CORPORATION
PERFORMANCE-BASED
(January 8, 2008)
Xxxxx Corporation (the “Corporation”), a Wisconsin corporation, hereby grants to
(the “Employee”) a Restricted Stock Award (the “Award”) with respect to
shares (the “Shares”) of Class A Common Stock, $.01 par value, of the Corporation (the
“Common Stock”), all in accordance with and subject to the following terms and conditions:
1. Plan; Defined Terms. This Award is made pursuant to the Xxxxx Corporation 2006
Omnibus Incentive Stock Plan (the “Plan”). In the event of any conflict between any provisions of
this Award and the provisions of the Plan, the provisions of the Plan shall control. Terms defined
in the Plan where used herein shall have the meanings as so defined. Employee acknowledges receipt
of a copy of the Plan.
2. Vesting Requirements. The vesting of this Award (other than pursuant to accelerated
vesting in certain circumstances as provided in Section 3 below) shall be subject to the
satisfaction of the conditions set forth in both Section 2(a) and Section 2(b) below:
(a) Performance Vesting Requirement (Earnings per Share Improvement). The performance
vesting requirement under this Section 2(a) shall be satisfied only if the Earnings Per Share for
any one of the Corporation’s fiscal years ending July 31, 2009, July 31, 2010, July 31, 2011 or
July 31, 2012 are at least 10% greater than the Earnings Per Share for the Corporation’s fiscal
year ending July 31, 2008. For purposes of this Agreement, “Earnings per Share” shall mean the
basic earnings per share of the Corporation’s Class A Common Stock calculated in accordance with
the standards of the Public Company Accounting Oversight Board as in effect for the fiscal year
ended July 31, 2008. If the performance vesting requirement is not satisfied for any of the four
designated fiscal years, the Award shall be immediately forfeited.
(b) Service Vesting Requirement. In addition to the performance vesting requirement of
Section 2(a) above, the Award shall become vested only if the Employee remains continuously
employed by the Corporation (or an Affiliate) from the date hereof until January 15, 2013. If this
service vesting requirement is not satisfied, this Award shall be immediately forfeited.
The period of time during which the Shares covered by this Award are forfeitable is referred
to as the “Restricted Period.”
3. Accelerated Vesting.
(a) Notwithstanding the terms and conditions of Section 2 hereof, in the event of the
termination of the Employee’s employment with the Corporation (and any Affiliate) prior to the end
of the Restricted Period due to death or disability, the Shares shall become unrestricted and fully
vested. For purposes of this Agreement, “Disability” means that the Employee is disabled as a
result of sickness or injury, such that he is unable to satisfactorily perform the material duties
of his or her job, as determined by the Committee, on the basis of medical evidence satisfactory to
it.
(b) In the event of the termination of the Employee’s employment with the Corporation (and any
Affiliate) prior to the end of the Restricted Period due to a Change in Control, the Shares shall
become unrestricted and fully vested.
For purposes of this Agreement, a “Change of Control” shall occur if any person or group of
persons (as defined in Section 13(d)(3) of the Securities and Exchange Act of 1934) other than the
members of the family of Xxxxxxx X. Xxxxx, Xx. and their descendants, or trusts for their benefit,
collectively, directly or indirectly controls in excess of 50% of the voting common stock of the
Corporation.
For purposes of this Agreement, a termination due to Change of Control shall occur if within
the 12 month period beginning with the date a Change of Control occurs (i) the Employee’s
employment with the Corporation (and any Affiliate) is involuntarily terminated (other than by
reason of death, disability or Cause) or (ii) the Employee’s employment with the Corporation (and
any Affiliate) is voluntarily terminated by the Employee subsequent to (A) a 10% or more diminution
in the total of the Employee’s annual base salary (exclusive of fringe benefits) and the Employee’s
target bonus in comparison with the Employee’s total of annual base salary and target bonus
immediately prior to the date the Change of Control occurs, (B) a significant diminution in the
responsibilities or authority of the Employee in comparison with the Employee’s responsibility and
authority immediately prior to the date the Change of Control occurs or (C) the imposition of a
requirement by the Corporation that the Employee relocate to a principal work location more than 50
miles from the Employee’s principal work location immediately prior to the date the Change of
Control occurs.
For purposes of this Agreement, Cause means (i) the Employee’s willful and continued failure
to substantially perform the Employee’s duties with the Corporation (other than any such failure
resulting from physical or mental incapacity) after written demand for performance is given to the
Employee by the Corporation which specifically identifies the manner in which the Corporation
believes the Employee has not substantially performed and a reasonable time to cure has transpired,
(ii) the Employee’s conviction of or plea of nolo contendere for the commission of a felony, or
(iii) the Employee’s commission of an act of dishonesty or of any willful act of misconduct which
results in or could reasonably be expected to result in significant injury (monetarily or
otherwise) to the Corporation, as determined in good faith by the Committee.
(c) In the event of (i) the merger or consolidation of the Corporation with or into another
corporation or corporations in which the Corporation is not the surviving
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corporation, (ii) the adoption of any plan for the dissolution of the Corporation, or (iii)
the sale or exchange of all or substantially all the assets of the Corporation for cash or for
shares of stock or other securities of another corporation, all restrictions imposed on any
then-restricted Shares shall terminate (such that any Shares shall become fully transferable)
immediately prior to any such event in which the Corporation is not the surviving corporation.
(d) If the lapsing of the restrictions would result in any excise tax to the Employee as a
result of Section 280G of the Code, the Corporation shall pay the Employee an amount equal to such
excise tax.
4. Dividend Rights. The Employee shall have the right to receive any cash dividends
otherwise payable with respect to the Shares, as paid, and the Employee shall have all other rights
as holder of such Shares, provided, however, the Corporation shall retain custody of all stock
certificates representing shares as to which such restriction has not lapsed.
5. No Guarantee of Employment. Nothing contained in this Agreement shall give the
Employee the right to be retained in the employment of the Corporation or affect the right of the
Corporation to dismiss the Employee.
6. Transfer Restrictions. This Award and the Shares (until they become unrestricted
pursuant to the terms hereof) are non-transferable and may not be assigned, pledged or hypothecated
and shall not be subject to execution, attachment or similar process. Upon any attempt to effect
any such disposition, or upon the levy of any such process, the Award shall immediately become null
and void and the Shares shall be forfeited.
7. Withholding Taxes. The Corporation may require payment of or withhold any tax
which it believes is payable as a result of the Shares becoming unrestricted and fully vested, and
the Corporation may defer making delivery with respect to Shares until arrangements satisfactory to
the Corporation have been made with regard to any such withholding obligations. In lieu of part or
all of any such payment, the Employee, in satisfaction of all withholding taxes (including, without
limitation, Federal income, FICA (Social Security and Medicare) and any state and local income
taxes) payable as a result of such vesting, may elect, subject to such rules and regulations as the
Committee may adopt from time to time, to have the Corporation withhold that number of Shares
(valued at Fair Market Value on the date of vesting and rounded upward) required to settle such
withholding taxes.
8. Death of Employee. If any of the Shares shall vest upon the death of the Employee,
they shall be registered in the name of the estate of the Employee unless the Corporation shall
have theretofore received in writing a beneficiary designation, in which event they shall be
registered in the name of the designated beneficiary.
9. Adjustment of Shares. The terms and provisions of this Award (including, without
limitation, the terms and provisions relating to the number and class of shares subject to this
Award) shall be subject to appropriate adjustment in the event of any recapitalization, merger,
consolidation, disposition of property or stock, separation, reorganization, stock dividend,
issuance of rights, combination or split-up or exchange of shares, or the like.
10. Wisconsin Contract. This Award has been granted in Wisconsin and shall be construed
under the laws of that state.
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IN WITNESS WHEREOF, this Restricted Stock Agreement has been duly executed as of January 8,
2008.
| XXXXX CORPORATION |
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| By: | /s/ Xxxxx Xxxxxxxx | |||
| Xxxxx Xxxxxxxx, President | ||||
| Attest: | /s/ Xxxx X. Xxxxxxxx | |||
| Xxxx X. Xxxxxxxx, Secretary | ||||
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