Exhibit 10.3
PERFORMANCE-BASED RESTRICTED STOCK AGREEMENT
THIS PERFORMANCE-BASED RESTRICTED
STOCK AGREEMENT (this “Agreement”) is made as of
the effective date set forth on the attached notice of grant (the
“Grant Notice”), between GROUP 1 AUTOMOTIVE,
INC. , a Delaware corporation (the “Company”), and
the employee set forth on the Grant Notice
(“Employee”).
1. Award .
Pursuant to the GROUP 1 AUTOMOTIVE, INC. 1996 STOCK INCENTIVE
PLAN , as amended (the “Plan”), the number of
shares (the “Restricted Shares”) of the Company’s
common stock set forth in the Grant Notice shall be issued as
hereinafter provided in Employee’s name subject to certain
restrictions thereon. The Restricted Shares shall be issued upon
acceptance hereof by Employee (which shall be demonstrated by
Employee’s execution of the Grant Notice) and upon
satisfaction of the conditions of this Agreement and the Grant
Notice. Employee acknowledges receipt of a copy of the Plan, and
agrees that this award of Restricted Shares shall be subject to all
of the terms and provisions of the Plan, including future
amendments thereto, if any, pursuant to the terms thereof. In the
event of any conflict between the terms of this Agreement and the
Plan, the Plan shall control. The Plan and the Grant Notice are
incorporated herein by reference as a part of this Agreement.
Capitalized terms used but not defined herein shall have the
meanings attributed to such terms in the Plan.
2 . Restricted
Shares . Employee hereby accepts the Restricted
Shares when issued and agrees with respect thereto as
follows:
(a) Forfeiture
Restrictions . The Restricted Shares may not be
sold, assigned, pledged, exchanged, hypothecated or otherwise
transferred, encumbered or disposed of to the extent then subject
to the Forfeiture Restrictions (as hereinafter defined), and in the
event of termination of Employee’s employment with the
Company for any reason other than death or Disability (as
hereinafter defined), Employee shall, for no consideration, forfeit
to the Company all Restricted Shares to the extent then subject to
the Forfeiture Restrictions. The prohibition against transfer and
the obligation to forfeit and surrender Restricted Shares to the
Company upon termination of employment are herein referred to as
the “Forfeiture Restrictions.” The Forfeiture
Restrictions shall be binding upon and enforceable against any
transferee of the Restricted Shares. For purposes of this
Agreement, the term “Disability” shall mean that
Employee has become disabled within the meaning of section
409A(a)(2)(C) of the Code and applicable administrative authority
thereunder.
(b) Lapse of Forfeiture
Restrictions . With respect to each Performance
Period (as defined on Exhibit A hereto, which Exhibit is fully
incorporated herein by this reference), the Forfeiture Restrictions
shall lapse as to the Restricted Shares in accordance with the
performance-based vesting schedule set forth on Exhibit A (the
“Vesting Schedule”), provided that Employee has been
continuously employed by the Company from the date of this
Agreement through the date that the Committee certifies the results
for such Performance Period. To the extent that performance
target(s) are not
Performance-based restricted
stock agreement
achieved in a
particular Performance Period, if they are determined by the
Committee to be achieved on a cumulative basis with respect to such
Performance Period during any subsequent Performance Period during
the Term, in accordance with the provisions of Exhibit A, then the
Forfeiture Restrictions shall lapse as to the corresponding
percentage of Restricted Shares set forth with respect to such
Performance Period on the Vesting Schedule. To the extent that the
performance target(s) with respect to any Performance Period(s) are
not achieved during the Term of this Agreement in accordance with
the requirements of Exhibit A, the corresponding percentage of
Restricted Shares as set forth on the Vesting Schedule with respect
to such Performance Period(s) shall be forfeited to the Company.
The Company shall not issue fractional shares and shall round to
the nearest whole share when calculating vesting and lapsing of the
Forfeiture Restrictions. Notwithstanding the foregoing, the
Forfeiture Restrictions shall lapse as to all of the Restricted
Shares then subject to the Forfeiture Restrictions on the date
Employee’s employment with the Company is terminated by
reason of death or Disability.
(c) Certificates
. A certificate evidencing the Restricted Shares shall be
issued by the Company in Employee’s name, pursuant to which
Employee shall have all of the rights of a stockholder of the
Company with respect to the Restricted Shares, including, without
limitation, voting rights and the right to receive dividends
(provided, however, that dividends paid in shares of the
Company’s stock (“Stock Dividends”) shall be
subject to the Forfeiture Restrictions). Employee may not sell,
transfer, pledge, exchange, hypothecate or otherwise dispose of the
Restricted Shares and any Stock Dividends thereon until the
Forfeiture Restrictions have expired and a breach of the terms of
this Agreement shall cause a forfeiture of the Restricted Shares
and any Stock Dividends thereon. The certificate shall be delivered
upon issuance to the Secretary of the Company or to such other
depository as may be designated by the Committee as a depository
for safekeeping until the forfeiture of such Restricted Shares and
any Stock Dividends thereon occurs or the Forfeiture Restrictions
lapse pursuant to the terms of the Plan and this award. On the date
of this Agreement, Employee shall deliver to the Company a stock
power, endorsed in blank, relating to the Restricted Shares and any
Stock Dividends thereon. As soon as practicable following the lapse
of the Forfeiture Restrictions without forfeiture as to any portion
of the Restricted Shares and any Stock Dividends thereon, the
Company shall cause a new certificate or certificates to be issued
without legend (except for any legend required pursuant to
applicable securities laws or any other agreement to which Employee
is a party) in the name of Employee in exchange for the certificate
evidencing the Restricted Shares and any Stock Dividends thereon.
However, the Company, in its sole discretion, may elect to deliver
the certificate either in certificate form or electronically to a
brokerage account established for Employee’s benefit at a
brokerage/financial institution selected by the Company. Employee
agrees to complete and sign any documents and take additional
action that the Company may request to enable it to deliver the
shares on Employee’s behalf.
(d) Corporate Acts
. The existence of the Restricted Shares shall not affect in
any way the right or power of the Board or the stockholders of the
Company to make or authorize any adjustment, recapitalization,
reorganization or other change in the Company’s capital
structure or its business, any merger or consolidation of the
Company,
Performance-based restricted
stock agreement
2
any issue of
debt or equity securities, the dissolution or liquidation of the
Company or any sale, lease, exchange or other disposition of all or
any part of its assets or business or any other corporate act or
proceeding. The prohibitions of Section 2(a) hereof shall not apply
to the transfer of Restricted Shares pursuant to a plan of
reorganization of the Company, but the stock, securities or other
property received in exchange therefor shall also become subject to
the Forfeiture Restrictions and provisions governing the lapsing of
such Forfeiture Restrictions applicable to the original Restricted
Shares for all purposes of this Agreement and the certificates
representing such stock, securities or other property shall be
legended to show such restrictions.
3. Withholding of Tax/Tax
Election . To the extent that the receipt of the Restricted
Shares or the lapse of any Forfeiture Restrictions results in
compensation income to Employee for federal or state income tax
purposes, Employee shall deliver to the Company at the time of such
receipt or lapse, as the case may be, such amount of money as the
Company may require to meet its obligation under applicable tax
laws or regulations or make such other arrangements to satisfy such
withholding obligation as the Company, in its sole discretion, may
approve. In addition, the Company may withhold unrestricted shares
of stock of the Company (valued at their fair market value on
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