[ Form for
Mr. Essig’s Annual RSU Grant ]
INTEGRA LIFESCIENCES HOLDINGS
CORPORATION
CONTRACT STOCK / RESTRICTED UNITS AGREEMENT
Pursuant to
2003 EQUITY INCENTIVE PLAN
AGREEMENT, dated
as of
, 20___, by and between Integra LifeSciences Holdings Corporation,
a Delaware corporation (the “ Company ”), and
Stuart M. Essig (“ Executive ”).
WHEREAS, the
Company and Executive previously entered into that certain Second
Amended and Restated Employment Agreement dated as of July 27,
2004, as amended by Amendment 2006-1 to the Second Amended and
Restated Employment Agreement and Amendment 2008-1 to the Second
Amended and Restated Employment Agreement;
WHEREAS, as of
August 6, 2008, the Company and Executive have entered into an
Amendment 2008-2 to the Second Amended and Restated Employment
Agreement (such Second Amended and Restated Employment Agreement,
as so amended being hereinafter called the “ Employment
Agreement ”), pursuant to which Executive will continue
to serve as President and Chief Executive Officer of the Company,
on the terms and conditions set forth and described
therein;
WHEREAS, pursuant
to the Employment Agreement, the Company has agreed to grant to
Executive an annual equity-based award under the Integra
LifeSciences Holdings Corporation 2003 Equity Incentive Plan (the
“ 2003 Plan ”), a copy of which is attached
hereto; and
WHEREAS, the
Compensation Committee of the Board of Directors of the Company,
appointed to administer the 2003 Plan, has determined that it would
be to the advantage and in the best interest of the Company and its
stockholders to grant to the Executive an annual award for [INSERT
YEAR] of an aggregate of [
] (
) shares of contract stock in the form of restricted units (the
“ Units ”) representing an equal number of
shares of restricted common stock of the Company, par value $.01
per share (“ Common Stock ”), on the terms set
forth herein.
NOW, THEREFORE, in
consideration of the mutual covenants hereinafter set forth and for
other good and valuable consideration the legal sufficiency of
which is hereby acknowledged, the parties hereto, intending to be
legally bound hereby, agree as follows:
1.
Definitions . Capitalized terms not otherwise defined herein
shall have the meaning set forth in the Employment Agreement or the
2003 Plan, as applicable, unless otherwise indicated.
2. Grant
of Units . Pursuant to Section 3.2(c)(i)(C) of the
Employment Agreement, Executive is hereby granted, as of
, 20___(the “ Grant Date ”), deferred
compensation in the form of [
] (
) Units pursuant to the terms of this Agreement and the 2003 Plan.
The Executive’s right to receive the shares of Common Stock
underlying the Units shall be subject to forfeiture as provided in
Section 4 of this Agreement.
(a) Subject
to paragraph (b) and Section 4 below, the Units shall
vest in cumulative installments as follows:
(i) One-third
(⅓) of the Units shall vest on the first anniversary of the
Grant Date;
(ii) One-third
(⅓) of the Units shall vest on the second anniversary of the
Grant Date; and
(iii) One-third
(⅓) of the Units shall vest on the third anniversary of the
Grant Date;
(b) One
hundred percent (100%) of the then outstanding Units shall vest in
the event that:
(i) Executive
incurs a Termination of Service (as defined below) (1) by the
Company without “Cause” (as defined in Section 4.3
of the Employment Agreement), (2) by the Executive for “Good
Reason” (as defined in Section 4.4 of the Employment
Agreement), (3) by reason of a “Disability
Termination” (as defined in Section 4.2 of the
Employment Agreement), (4) by reason of the Executive’s
death, (5) as a result of the Employment Agreement (or the
Executive’s successor employment agreement with the Company,
if any) not being amended, renewed or replaced by a new employment
agreement upon the expiration of such agreement on
December 31, 2011 or the Extended Expiration Date (as defined
below), as applicable; or
(ii) a
“Change in Control” (as defined in the Employment
Agreement) that occurs prior to the Executive’s Termination
of Service.
(c) For
purposes of this Agreement, (1) “ Termination of
Service ” shall mean the time when the Executive ceases
to provide services to the Company and its Related Corporations and
Affiliates as an employee or Associate for any reason with or
without cause, including, but not by way of limitation, a
termination by resignation, discharge, death, or disability. A
Termination of Service shall not include a termination where the
Executive is simultaneously reemployed by, or remains employed by,
or continues to provide services to, the Company and/or one or more
of its Related Corporations and Affiliates or a successor entity
thereto; and (2) “ Extended Expiration Date ”
shall mean, in the event that the Executive and the Company enter
into (including by way of an automatic extension) a new, amended or
renewed employment agreement on or prior to December 31, 2011, the
last day of the term of such new, amended or renewed employment
agreement.
4.
Forfeiture of Units . Immediately upon a Termination of
Service for any reason, the Executive shall forfeit any and all
Units which have not vested or do not vest on or prior to such
termination, and the Executive’s rights in any such Units
which are not so vested shall terminate, lapse and expire
(including the Executive’s right to receive the shares
underlying such Units).
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5.
Dividend Equivalents . Executive shall be entitled to
receive, with respect to all outstanding vested Units (as such
Units may be adjusted under Section 8), dividend equivalent
amounts equal to the regular quarterly cash dividend payable to
holders of Common Stock (to the extent regular quarterly cash
dividends are paid) as if Executive were an actual shareholder with
respect to the number of shares of Common Stock equal to his
outstanding vested Units. Such dividend equivalent amounts shall be
aggregated on a quarterly basis while the Units are outstanding and
paid to Executive within thirty (30) days following the first
business day that occurs immediately following the 6-month period
after the date of Executive’s “separation from
service” from the Company (within the meaning of
Section 409A(a)(2)(A)(i) of the Internal Revenue Code of 1986,
as amended (the “ Code ”) and its corresponding
regulations) (a “ Separation from Service ”).
For the avoidance of doubt, such dividend equivalent amounts shall
only be paid with respect to Units that are vested as of the
applicable dividend payment date, and Executive shall not be
entitled to receive any dividend equivalent amounts with respect to
Units that are not vested as of such dividend payment date. The
dividend equivalents and any amounts that may become payable in
respect thereof shall be treated separately from the Units and the
rights arising in connection therewith for purposes of the
designation of time and form of payments required by Code
Section 409A.
(a) The
shares of Common Stock underlying Units which are then vested under
Section 3(a) or 3(b) (the “ Unit Shares ”) shall
be paid out to Executive within thirty (30) days following the
first business day that occurs immediately following the 6-month
period after the date of Executive’s Separation from
Service.
(b) All
payments of Unit Shares shall be made by the Company in the form of
whole shares of Common Stock, and any fractional share shall be
distributed in cash in an amount equal to the value of such
fractional share determined based on the Fair Market Value (as
defined in the 2003 Plan) as of the date immediately prior to such
distribution.
(c) Any
Unit Shares delivered shall be deposited in an account designated
by Executive and maintained at a brokerage house selected by
Executive. Any such Unit Shares shall be duly authorized, fully
paid and non-assessable shares, listed with NASDAQ or the principal
United States securities exchange on which the Common Stock is
admitted to trading and registered on the Company Registration
Statement, if registration is requested by Executive.
(d) Except
as otherwise provided in this Agreement, Executive shall not be
deemed to be a holder of any Common Stock pursuant to a Unit until
the date of the issuance of a certificate to him for such shares
and, except as otherwise provided in this Agreement, Executive
shall not have any rights to dividends or any other rights of a
shareholder with respect to the shares of Common Stock covered by a
Unit until such shares of Common Stock have been issued to him,
which issuance shall not be unreasonably delayed.
(e) The
Company shall be entitled to withhold in cash or deduction from
other compensation payable to the Executive any sums required by
federal, state or local tax law to be withheld with respect to the
vesting, distribution or payment of the Units or the Unit Shares.
In satisfaction of the foregoing requirement with respect to the
distribution or payment of the Units, the Company shall withhold
shares of Common Stock otherwise issuable in such distribution
having
3
a Fair Market
Value equal to the sums required to be withheld. Subject to the
following sentence, the number of shares of Common Stock which
shall be so withheld in order to satisfy the Executive’s
federal, state and local withholding tax liabilities with respect
to the issuance of shares of Common Stock in payment of the Units
shall be limited to the number of shares which have a Fair Market
Value on the date of withholding equal to the aggregate amount of
such liabilities based on the minimum statutory withholding rates
for federal, state and local tax purposes that are applicable to
such supplemental taxable income. In the event that the number of
shares of Common Stock having a Fair Market Value equal to the sums
required to be withheld is not a whole number of shares, the number
of shares so withheld shall be rounded up to the nearest whole
share.
(f) Executive’s
right to receive payment of any amounts under this Agreement shall
be an unfunded entitlement and shall be an unsecured claim against
the general assets of the Company.
(g) After
payment in accordance with this Section 6, the Unit Shares may
not be sold, transferred or otherwise disposed of by Executive for
a period of five days after receipt of such shares by Executive,
except that no such restrictions shall apply in the case of a
Change in Control or in the event that Unit Shares are sold or
withheld in order to satisfy any obligations Executive may have
with respect to any applicable tax withholding requirements on
vesting or receipt of Unit Shares (including, without limitation,
pursuant to Section 6(e) above).
7.
Representations . The Company represents and warrants that
this Agreement has been authorized by all necessary action of the
Company, has been approved by the Board and is a valid and binding
agreement of the Company enforceable against it in accordance with
its terms and that the Unit Shares will be issued pursuant to and
in accordance with the 2003 Plan, will be listed with NASDAQ or the
principal United States securities exchange on which the Common
Stock is admitted to trading, and will be validly issued, fully
paid and non-assessable shares. The Company further represents and
warrants that the grant of Units under this Agreement has been
approved by the Company’s Compensation Committee, that the
2003 Plan has and will have sufficient shares available to effect
the distribution of the Unit Shares, and that the Company will file
a Hart Scott Rodino application with respect to Executive on a
timely basis, if necessary, in connection with the acquisition of
Unit Shares by Executive under this Agreement.
8.
Changes in the Common Stock and Adjustment of Units
.
(a) In
the event the outstanding shares of
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