EXHIBIT 10(o)
FORM OF
PERFORMANCE SHARE GRANT
AGREEMENT
Dated: XXX, 200X
To: «FIRST_NAME»
«LAST_NAME»
Pursuant to the Handleman Company
2001 Stock Option and Incentive Plan (the “
Plan ”), Handleman Company (the “
Corporation ”) hereby grants you the right to
receive shares (“ shares ”) of the
Corporation’s common stock upon the terms of this Agreement
and the Plan, which Plan, as it may be amended from time to time,
is made a part of and incorporated by reference into this Agreement
and is available upon request.
1. Your right to receive shares, and
the number of shares you may receive, under this Agreement shall be
contingent upon achievement of the following performance
goals:
(i) If Free Cash Flow (defined
below) for the Performance Period (defined below) is less than $XX
million, you shall not be entitled to receive any shares under this
Agreement.
(ii) If Free Cash Flow for the
Performance Period is equal to or greater than $XX million but less
than $XX million, the number of shares you may receive under this
Agreement shall equal the sum of (a) fifty percent (50%) of the
Target Number (defined below), plus (b) the product of (X) and (Y),
where (X) is fifty percent (50%) of the Target Number and (Y) is a
fraction, the numerator of which is the excess, if any, of the Free
Cash Flow for the Performance Period over $XX million, and the
denominator of which is $XX million.
(iii) If Free Cash Flow for the
Performance Period is equal to or greater than $XX million but less
than $XX million, the number of shares you may receive under this
Agreement shall equal the sum of (a) one hundred percent (100%) of
the Target Number, plus (b) the product of (X) and (Y), where (X)
is fifty percent (50%) of the Target Number and (Y) is a fraction,
the numerator of which is the excess, if any, of the Free Cash Flow
for the Performance Period over $XX million, and the denominator of
which is $XX million.
(iv) If Free Cash Flow for the
Performance Period is equal to or greater than $XX million, the
number of shares you may receive under this Agreement shall equal
one hundred fifty percent (150%) of the Target Number.
For purposes of this Agreement, Free Cash Flow
shall mean, as reflected in the audited consolidated financial
statements of the Corporation and its subsidiaries, (a) net
operating profit
