CTM MEDIA HOLDINGS, INC. RESTRICTED STOCK AGREEMENT
Exhibit 10.01
XXXXXX
X. XXXXX
00 Xxxxx
Xxxxx Xxxxx
Xxxxxxxx,
Xxxxxxxxxxx 00000
This
Agreement confirms the grant of Restricted Stock to you effective as of October
14, 2009 (the “Effective Date”) upon the terms and conditions described
herein.
1. Grant of Restricted
Stock. Pursuant to action of the Compensation Committee (the
“Committee”) of the Board of Directors (the “Board”), CTM Media Holdings, Inc.
(the “Company”) hereby grants you, in lieu of your annual cash compensation of
Two Hundred and Fifty Thousand Dollars ($250,000) for the five year period
starting October 14, 2009 through October 13, 2014, an aggregate of ONE MILLION, SEVEN HUNDRED
EIGHTY-FIVE THOUSAND, SEVEN HUNDRED AND FOURTEEN (1,785,714) shares of
Restricted Stock of the Company’s Class B Common Stock (the “Restricted
Shares”), subject to the terms and conditions hereinafter set
forth.
2. Closing. The
transfer of the Restricted Shares occurred on the Effective Date. Concurrently
with the execution of this Agreement, the Company may issue one or more
certificates representing the Restricted Shares (which shall be held by the
Company pursuant to Section 6 until the applicable Restrictions (as defined in
Section 3) have lapsed).
3. Restrictions. The
Restricted Shares are being awarded to you subject to (i) the transfer and
forfeiture restrictions set forth in this Section 3 (the “Restrictions”), which
shall lapse after the expiration of the vesting periods described in Section 4,
(ii) satisfaction of the tax withholding requirements set forth in Section
8, and (iii) compliance with the Company’s Xxxxxxx Xxxxxxx Policy, as may
be amended from time to time (the “Xxxxxxx Xxxxxxx Policy”).
(a) Transfer. You may
not directly or indirectly, by operation of law or otherwise, voluntarily or
involuntarily, alienate, attach, sell, assign, pledge, encumber, charge or
otherwise transfer any of the Restricted Shares still subject to Restrictions,
except for such assignments by will or the laws of descent and distribution,
provided that, in all cases, such transferee executes a written consent to be
bound by the terms of this Agreement.
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(b) Forfeiture. Subject
to exceptions as set forth herein (including, but not limited to, the occurrence
of an Acceleration Event (as defined below)) or as otherwise may be determined
by the Committee, if your continuous employment with the Company shall terminate
for any reason, all Restricted Shares for which the Restrictions have not lapsed
at such time shall be returned to or canceled by the Company, and shall be
deemed to have been forfeited by you. Upon a forfeiture of your Restricted
Shares, the Company will not be obligated to pay you any consideration
whatsoever for the forfeited Restricted Shares.
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“Continuous
employment” means that the provision of services to the Company or a
Related Entity in any capacity of officer, employee, director or
consultant is not interrupted or terminated. Continuous employment shall
not be considered interrupted in the case of (i) any approved leave of
absence, (ii) transfers between locations of the Company or among the
Company, any Related Entity or any successor in any capacity of officer,
employee, director or consultant, or (iii) any change in status as long as
the individual remains in the service of the Company or a Related Entity
in any capacity of officer, employee, director or consultant (except as
otherwise agreed to by the parties). An approved leave of absence shall
include sick leave, military leave (including without limitation service
in the National Guard or the Army Reserves) or any other personal leave
approved by the Committee. No such leave may exceed ninety (90) days
unless reemployment upon expiration of such leave is guaranteed by statute
or contract.
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“Related
Entity” means any parent, subsidiary or any business, corporation,
partnership, limited liability company or other entity in which the
Company, a parent or a subsidiary holds a substantial ownership interest,
directly or indirectly.
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4. Lapse
of Restrictions.
(a) The
Restrictions shall lapse to the extent the Restricted Shares have become vested,
as follows: (i) as to FIVE HUNDRED NINETY FIVE THOUSAND, TWO HUNDRED THIRTY
EIGHT (595,238) Restricted Shares, on October 14, 2011, (ii) as to FIVE HUNDRED
NINETY FIVE THOUSAND, TWO HUNDRED THIRTY EIGHT (595,238) Restricted Shares, on
October 14, 2012 and (iii) as to FIVE HUNDRED NINETY FIVE THOUSAND, TWO HUNDRED
THIRTY EIGHT (595,238) Restricted Shares, on October 14, 2013.
(b) Other
than as set forth below, all of the Restricted Shares shall become vested and
the Restrictions shall lapse with respect to any unvested Restricted Shares upon
the occurrence of any of the following events (each an “Acceleration
Event”):
(i) A
“Corporate Transaction”, which shall mean:
(A) A merger
or consolidation of the Company with any other corporation or other entity,
other than (x) a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving or parent entity) 80% or more of the combined voting
power of the voting securities of the Company or such surviving or parent entity
outstanding immediately after such merger or consolidation or (y) a merger or
consolidation effected to implement a recapitalization of the Company (or
similar transaction) in which no “person” (as defined in the Securities Exchange
Act of 1934, as amended (the “Exchange Act”)) acquired 25% or more of the
combined voting power of the Company’s then outstanding securities;
or
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(B) a plan of
complete liquidation of the Company or an agreement for the sale or disposition
by the Company of all or substantially all of its assets (or any transaction
having a similar effect).
(ii) A
“Change in Control”, which shall mean a change in ownership or control of the
Company effected through either of the following:
(A) any
“person,” as such term is used in Sections 13(d) and 14(d) of the Exchange Act
(other than (w) the Company, (x) any trustee or other fiduciary holding
securities under an employee benefit plan of the Company, (y) any corporation or
other entity owned, directly or indirectly, by the stockholders of the Company
in substantially the same proportions as their ownership of common stock, or (z)
any person who, on the date hereof, owned more than 25% of the combined voting
power of the Company’s then outstanding voting securities), is or becomes the
“beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company (not including in the securities
beneficially owned by such person any securities acquired directly from the
Company or any of its affiliates other than in connection with the acquisition
by the Company or its affiliates of a business) representing 25% or more of the
combined voting power of the Company’s then outstanding voting securities;
or
(B) during
any period of not more than two consecutive years, not including any period
prior to the date hereof, individuals who at the beginning of such period
constitute the Board, and any new director (other than a director whose initial
assumption of office is in connection with an actual or threatened election
contest, including, but not limited to a consent solicitation, relating to the
election of directors of the Company) whose election by the Board or nomination
for election by the Company’s stockholders was approved by a vote of at least
two-thirds (2/3) of the directors then still in office who either were directors
at the beginning of the period or whose election or nomination for election was
previously so approved, cease for any reason to constitute at least a majority
thereof.
(iii) Your
death or “Disability”, which shall mean your inability to perform your duties on
account of a physical or mental illness for a period of ninety (90) consecutive
days or one hundred and twenty (120) days in any eight (8) month
period.
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(iv) (A) Termination
of your employment with the Company by you for “Good Reason”, which shall mean
the occurrence (without your express written consent) of any one of the
following acts by the Company, or failure by the Company to act:
(x) a
material breach of this Agreement by the Company; or
(y) the
assignment to you of any duties inconsistent with your status as Chairman of the
Company (or other position, if applicable) or a substantial adverse alteration
in the nature or status of your responsibilities.
(B) A
“Termination for Good Reason” by you may only be effected if (A) you have given
written notice to the Company of the existence of the Good Reason event no later
than ninety (90) days after its initial existence, (B) the Company has not
remedied such Good Reason event in all material respects within thirty (30) days
after its receipt of such written notice, and (C) you terminated employment
within one (1) year following the initial existence of such Good Reason
Event.
(C) Your
right to terminate your employment for Good Reason shall not be affected by your
incapacity due to physical or mental illness. Your continued
employment shall not constitute consent to, or a waiver of rights with respect
to any act or failure to act constituting Good Reason
hereunder. Notwithstanding the foregoing, a termination shall not be
treated as a Termination for Good Reason if you shall have consented in writing
to the occurrence of the event giving rise to the claim of Termination for Good
Reason.
(c) If your
employment is terminated by the Company for Cause then (i) the Pro Rata Portion
of the Restricted Shares that have not vested as of the Date of Termination
shall accelerate and vest and the Restrictions shall lapse with respect to such
Restricted Shares and (ii) all other Restricted Shares that had not yet vested
shall be forfeited. As used herein, the term “Pro Rata Portion” shall
mean a percentage of the Restricted Shares as shall reflect the pro rata portion
of the period between October 14, 2009 and October 13, 2014 representing your
time employed by the Company between October 14, 2009 and the Date of
Termination. For purposes of this Agreement, the Company shall have “Cause” to
terminate your employment (i) upon your conviction for the commission of an act
or acts constituting a felony under the laws of the United States or any state
thereof, or (ii) upon your willful and continued failure to substantially
perform your duties to the Company (other than any such failure resulting from
your incapacity due to physical or mental illness), after written notice has
been delivered to you by the Company, which notice specifically identifies the
manner in which you have not substantially performed your duties, and your
failure to substantially perform your duties is not cured within ten (10)
business days after notice of such failure has been given to you. For
purposes of this Section 4(c), no act or failure to act on your part shall be
deemed “willful” unless done or omitted to be done, by you not in good faith and
without reasonable belief that your act, or failure to act, was in the best
interest of the Company.
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(d) Notice of
Termination. Any termination of your employment
by the Company or you (other than termination by reason of your death)
shall be communicated by written Notice of Termination to the other party
hereto in accordance with Section 12. For purposes of this
Agreement, a “Notice of Termination” shall mean a notice that shall
indicate the specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and circumstances
claims to provide a basis for termination of your employment under the
provision so indicated. Further, a Notice of Termination for
Cause or Disability must include a copy of a resolution duly adopted by
the affirmative vote of not less than a majority of the entire membership
of the Board at a meeting of the Board (after reasonable notice to you and
an opportunity for you, together with your counsel, to be heard before the
Board) finding that, in the good faith opinion of the Board, you were
guilty of conduct set forth in the definition of Cause herein or satisfied
the criteria of a Disability, and specifying the particulars
thereof.
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(e) Date of
Termination. “Date of Termination” shall mean if
your employment is terminated (i) by your death, the date of your death,
(ii) by reason of Disability, the date that you are determined by the
Board to be Disabled, (iii) your resignation, the date you so notify the
Board, or (iv) the date specified in the Notice of Termination; provided, however, that
if within thirty (30) days after any Notice of Termination is given the
party receiving such Notice of Termination notifies the other party that a
dispute exists concerning the termination, the Date of Termination shall
be the date on which the dispute is finally determined. If
within fifteen (15) days after any Notice of Termination is given, or if
later, prior to the Date of Termination (as determined without regard to
this paragraph (e)), the party receiving such Notice of Termination
notifies the other party that a dispute exists concerning the termination,
the Date of Termination shall be the date on which the dispute is finally
resolved, either by mutual written agreement of the parties or by a final
judgment, order or decree of a court of competent jurisdiction (which is
not appealable or with respect to which the time for appeal, therefrom has
expired and no appeal has been perfected); provided further that
the Date of Termination shall be extended by a notice of dispute only if
such notice is given in good faith and the party giving such notice
pursues the resolution of such dispute with reasonable
diligence.
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(f) To the extent the Restrictions
shall have lapsed under this Section 4 with respect to any portion of the
Restricted Shares, those shares (“Vested Shares”) will be free of the terms and
conditions of this Agreement except those terms and conditions contained in
Section 8; provided, however, that such
Vested Shares shall remain subject to the terms and conditions of the Xxxxxxx
Xxxxxxx Policy.
5. Adjustments. The
terms “Restricted Shares” and “Vested Shares” shall include any shares or other
securities that you receive or become entitled to receive as a result of your
ownership of the original Restricted Shares.
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6. Custody. Any certificates
representing the Restricted Shares (other than Vested Shares) shall be deposited
with the Company. The Company is hereby authorized to effectuate the transfer
into its name of all certificates representing the Restricted Shares that are
forfeited or otherwise transferred to the Company pursuant to Section 3 or to
satisfy withholding obligations under Section 8.
7. Voting
and Other Rights.
(a) Upon
the registration of the Restricted Shares in your name, you shall have all of
the rights and status as a stockholder of the Company with respect to the
Restricted Shares, including the right to vote such shares and to receive
dividends or other distributions thereon. All such rights and status as a
stockholder of the Company with respect to the Restricted Shares shall terminate
if the Restricted Shares are forfeited pursuant to Section 3 or to satisfy
withholding obligations under Section 8.
(b) The
grant of the Restricted Shares to you does not confer upon you any right to
continue in the employ of the Company.
8. Withholding
Taxes. The award or other transfer of the Restricted Shares,
and the lapse of Restrictions on the Restricted Shares, shall be conditioned
further on any applicable withholding taxes being paid by you.
9. Stock Power. At
the Company’s request, you hereby agree to promptly execute any document,
including a stock power endorsed in blank, that is necessary to comply with the
terms of this Agreement.
10. Successors. This
Agreement shall be binding upon and inure to the benefit of any successor of the
Company and your successors, assigns and estate, including your executors,
administrators and trustees.
11. Amendment or Modification,
Waiver. No provision of this Agreement may be amended or
waived unless such amendment or waiver is agreed to in writing and signed by
each party hereto. No waiver by either party hereto of any breach by another
party hereto of any condition or provision of this Agreement to be performed by
such other party shall be deemed a waiver of a similar of dissimilar condition
or provision at the same time, any prior time or any subsequent
time.
12. Notices. Each
notice relating to this Agreement shall be in writing and delivered in person or
by certified mail or overnight delivery to the proper address. Notices to
employees sent via e-mail shall be deemed to satisfy the requirements of this
Section 12. All notices to the Company shall be addressed to it at:
00 Xxxxx
Xxxxx Xxxxx
Xxxxxxxx,
Xxxxxxxxxxx 00000
Attention:
Chief Financial Officer
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13. Severability. If
any provision of this Agreement or the application of any such provision to any
party or circumstances shall be determined by any court of competent
jurisdiction to be invalid and unenforceable to any extent, the remainder of
this Agreement or the application of such provision to such person or
circumstances other than those to which it is so determined to be invalid and
unenforceable, shall not be affected thereby, and each provision hereof shall be
validated and shall be enforced to the fullest extent permitted by
law.
14. Governing
Law. This Agreement shall be construed and governed in
accordance with the laws of the state of Delaware, without regard to principles
of conflicts of laws.
15. Headings. All
descriptive headings of sections and paragraphs in this Agreement are intended
solely for convenience, and no provision of this Agreement is to be construed by
reference to the heading of any section or paragraph.
16. Counterparts. This
Agreement may be executed in counterparts, each of which shall be deemed to be
an original but both of which together shall constitute one and the same
instrument.
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To
confirm your acceptance of the foregoing, please sign and date below under
“Accepted and Agreed” and return one copy of this Agreement to the Company,
attn: Chief Financial Officer.
By: /s/ Xxxxxx X. Xxxxxx
Xxxxxx X.
Xxxxxx
Chief
Financial Officer
ACCEPTED
AND AGREED:
/s/ Xxxxxx X. Xxxxx
Xxxxxx X.
Xxxxx
Date:
October 15, 2009
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