LONG TERM
INCENTIVE AWARD AGREEMENT
THIS
LONG TERM INCENTIVE AWARD AGREEMENT is made as of the 29
th
day of
January, 2009 (the “Grant Date”), by and between
Citizens Republic Bancorp, Inc. (the “Company”) and the
undersigned (“Grantee”), pursuant to the Citizens
Banking Corporation Stock Compensation Plan, as amended
(“Plan”). Capitalized terms not defined in this
Agreement shall have the meanings ascribed to them in the
Plan.
WHEREAS,
the Company desires to encourage Grantee to have a long term focus
with regard to the Company’s financial success, motivate and
encourage Grantee to achieve financial success for the Company and
to better align Grantee’s long term financial interests with
the interests of the Company’s shareholders;
WHEREAS,
the Company desires to grant this long term incentive award to
Grantee pursuant to the Plan;
NOW,
THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, it is agreed between
the parties as follows:
1.
Grant of Award . Subject to the terms and conditions
hereof, including without limitation the restrictions set forth in
paragraph 2 of this Agreement, the Company hereby grants to Grantee
(a) a total of ___shares of the Company’s Common Stock
(the “Restricted Stock Award”) and (b) a total of
$___in cash (the “Cash Award”).
(a) The
shares subject to the Restricted Stock Award will not be earned and
shall not be transferred, pledged, assigned, or otherwise alienated
or hypothecated except as follows, if Grantee is still employed
with the Company or an Affiliate on the applicable
date(s):
(i) The
restrictions on 50% of the shares subject to the Restricted Stock
Award (the “First Installment”) will lapse, and such
shares will be vested and earned, at the close of business on
January 29, 2011 if both of the following performance measures
are met:
(A)
The Company earns net income of at least $1.00 (determined in
accordance with U.S. generally accepted accounting principles
consistently applied) for the fiscal year ending December 31,
2010; and
(B)
The Company’s Pre-Tax/Pre-Provision Income for the fiscal
year ending December 31, 2010 is higher than its
Pre-Tax/Pre-Provision Income (as defined below) for the fiscal year
ending December 31, 2009.
(ii) The
restrictions on the remaining 50% of the shares subject to the
Restricted Stock Award (the “Second Installment”) and
on the First Installment, if the conditions
for vesting
and earning the First Installment pursuant to paragraph 2(a)(i)
were not satisfied, will lapse, and such shares will be vested and
earned, at the close of business on January 29, 2012 if both
of the following performance measures are met:
(A)
The Company earns net income of at least $1.00 (determined in
accordance with U.S. generally accepted accounting principles
consistently applied) for the fiscal year ending December 31,
2011; and
(B)
The Company’s Pre-Tax/Pre-Provision Income for the fiscal
year ending December 31, 2011 is higher than its
Pre-Tax/Pre-Provision Income for the fiscal year ending
December 31, 2010.
(iii) Shares
subject to the Restricted Stock Award that are not vested and
earned pursuant to paragraph 2(a)(i) or (ii) will be
canceled.
(iv) “Pre-Tax/Pre-Provision
Income” means net income (loss) (determined in accordance
with U.S. generally accepted accounting principles consistently
applied) excluding income tax provision (benefit), the provision
for loan losses, and impairment charges (such as goodwill, credit
writedowns and fair-value adjustments), as disclosed in the
Company’s earnings release.
(b) Except
as set forth in paragraph 2(c), the Cash Award shall be vested and
earned and become payable in three equal installments at the close
of business on each of the one year, two year and three year
anniversaries of the Grant Date, if Grantee is still employed with
the Company or an Affiliate on the applicable date(s).
(c) If
Grantee ceases to be employed with the Company or an Affiliate, the
following shall apply:
(i) If
termination of employment is due to Grantee’s retirement or
resignation, or Grantee’s employment is terminated by the
Company for Cause, the unvested portions of the Restricted Stock
Award and Cash Award on the date of termination shall be cancelled
and forfeited on such date.
(ii) If
termination of employment is due to elimination by the Company of
Grantee’s position, then (A) the unvested portion of the
Cash Award shall be cancelled and forfeited on the date of
termination; and (B) a pro-rata portion of the shares subject
to the Restricted Stock Award shall remain available for vesting if
the applicable conditions in paragraph 2(a) are satisfied,
determined as follows: (I) as to the First Installment, a
number of shares equal to the product of (x) the number of
shares in the First Installment, and (y) a fraction, the
numerator of which is the number of days that have elapsed from the
Grant Date through the date of such termination up to a maximum of
365, and the denominator of which is 365; and (II) as to the
Second Installment, a number of shares equal to the product of
(x) the number of shares in the Second Installment, and
(y) a fraction, the numerator of which is the number of days
that have elapsed from the Grant Date through the date of such
termination up to a maximum of 730, and the denominator of which is
730. Any shares not remaining available for vesting under
(B)
2
shall be
cancelled and forfeited on the date of termination. Shares
remaining available for vesting under (B) shall become vested
and earned only if the conditions specified in paragraph 2(a) have
been satisfied.
(iii) If
termination of employment is due to Grantee’s death,
Disability, or a termination of employment by the Company without
Cause, then (A) a pro-rata portion of the unvested Cash Award
shall become vested and earned equal to the product of (i) the
amount of the Cash Award subject to vesting on the next anniversary
of the Grant Date and (ii) a fraction, the numerator of which
is the number of days that have elapsed from the later of the
previous vesting date or the Grant Date through the date of such
termination, and the denominator of which is 365, and such amount
shall be payable on the next vesting date; and (B) a pro-rata
portion of the shares subject to the Restricted Stock Award shall
remain available for vesting if the applicable conditions in
paragraph 2(a) are satisfied, determined as follows: (I) as to
the First Installment, a number of shares equal to the product of
(x) the number of shares in the First Installment, and
(y) a fraction, the numerator of which is the number of days
that have elapsed from the Grant Date through the date of such
termination up to a maximum of 365, and the denominator of which is
365; and (II) as to the Second Installment, a number of shares
equal to the product of (x) the number of shares in the Second
Installment, and (y) a fraction, the numerator of which is the
number of days that have elapsed from the Grant Date through the
date of such termination up to a maximum of 730, and the
denominator of which is 730. Any shares not remaining available for
vesting under (B) and any other unvested portion of the Cash
Award at the date of termination shall be cancelled and forfeited
on the date of termination. Shares remaining available for vesting
under (B) shall become vested and earned only if the
conditions specified in paragraph 2(a) have been
satisfied.
(d) In
the event of a Change in Control, vesting shall occur as provided
in the Plan and in accordance with any Amended and Restated Change
in Control Agreement between the Company and Grantee.
(e) Until
the lapse of all restrictions provided in paragraph 2(a) on the
shares subject to the Restricted Stock Award, any certificate
evidencing unvested shares subject to the Restricted Stock Award
shall carry the following restrictive legend:
The sale or
other transfer of the shares of stock represented by this
certificate, whether voluntary, involuntary or by operation of law,
is subject to certain restrictions on transfer set forth in the
Citizens Banking Corporation Stock Compensation Plan (the
“Plan”), rules and administrative guidelines adopted
pursuant to such Plan and an Agreement dated January 29, 2009.
A copy of the Plan, such rules and such Agreement may be obtained
from the Secretary of the Company.
The
Company shall also have the right to place stop transfer
instructions on certificates representing unvested shares which are
subject to the Restricted Stock Award. Grantee shall be entitled to
removal of such legend and stop transfer instructions at the time
or times provided by, and in accordance with, Section 3.05 of
the Plan.
3
3.
Restrictive Covenants .
As
consideration for the grant of this restricted stock award, Grantee
agrees to comply with and be bound by the following restrictive
covenants:
(a)
Non-Disclosure of Confidential I
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