RESTRICTED STOCK
AGREEMENT
KAYDON CORPORATION
1999 Long Term Stock Incentive Plan
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James
O’Leary
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Grant
Date:
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Number of
Shares:
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This Restricted Stock Agreement (the
“Agreement”) is made as of the Grant Date between
KAYDON CORPORATION, a Delaware corporation (the
“Company”), and James O’Leary
(“Grantee”).
The Kaydon Corporation 1999 Long Term Stock
Incentive Plan (the “Plan”) is administered by the
Compensation Committee of the Company’s Board of Directors
(the “Committee”). The Committee has determined that
Grantee is eligible to participate in the Plan.
The Committee has granted restricted stock to
Grantee, subject to the terms and conditions contained in this
Agreement and in the Plan.
Grantee acknowledges receipt of a copy of the
Prospectus for the Plan and accepts these shares of restricted
stock subject to all of the terms, conditions, and provisions of
this Agreement and the Plan.
1. Grant of Restricted Stock . The
Company grants to Grantee, effective as of the Grant Date set forth
above, and Grantee accepts, the shares of $0.10 par value Common
Stock of the Company set forth above, subject to the terms and
conditions of this Agreement (the “Restricted
Stock”).
2. Conditions . The Company awards
the Restricted Stock to Grantee subject to the conditions described
below and to a vesting schedule. Those conditions must be met or
otherwise lapse, and vesting must occur, before Grantee will
receive any stock under this Agreement. If Grantee breaches the
terms of this Agreement or ceases to be employed by the Company for
certain reasons as described in this Agreement, if the applicable
restrictions are not satisfied or do not lapse, or if Grantee does
not vest in some or all of the Restricted Stock, Grantee will
promptly surrender to the Company those shares of Restricted Stock
as to which the restrictions have not lapsed or in which
Grantee’s interest has not vested pursuant to this Agreement
as set forth below.
3. Restrictions on Restricted Stock
. If Grantee is then employed by the Company and has not breached
the terms of this Agreement, the restrictions on twenty percent
(20%) of the initial number of shares of Restricted Stock will
lapse and the Grantee will vest in those shares on each January 5
following the Grant Date, commencing with January 5,
. Vesting under this provision will continue until all of the
shares are vested, the Grantee is no longer employed by the
Company, or another provision of this Agreement supersedes this
section, whichever occurs first. The Committee may, in its sole
discretion, accelerate the lapsing of restrictions and the vesting
of the Restricted Stock at any time before the restrictions would
otherwise lapse or before full vesting. As restrictions lapse and
vesting occurs, a certificate for the number of shares of
Restricted Stock as to which restrictions have lapsed will be
forwarded to the Grantee.
4. Transferability . Unless the
Committee otherwise consents or the Plan otherwise explicitly
provides, Grantee will not sell, exchange, transfer, pledge, or
otherwise dispose of the Restricted Stock at any time, whether
voluntarily or involuntarily, by operation of law or otherwise. The
provisions of this paragraph will not apply to Restricted Stock
that has vested pursuant to this Agreement. If Grantee violates the
restrictions in this Section, Grantee’s right to shares of
Restricted Stock remaining subject to restrictions or which have
not yet vested will immediately cease and terminate and Grantee
will immediately forfeit and surrender to the Company all shares of
Restricted Stock that are still subject to restrictions or which
have not yet vested.
5. Rights as a Shareholder .
Grantee will have certain rights as a shareholder with respect to
the Restricted Stock, including but not limited to the right to
vote the Restricted Stock at shareholders’ meetings, the
right to receive, without restriction, all cash dividends paid with
respect to the Restricted Stock, and the right to participate with
respect to the Restricted Stock in any stock dividend, stock split,
recapitalization, or other adjustment in the capital stock of the
Company, or any merger, consolidation, or other reorganization
involving an increase, decrease, or adjustment in the capital stock
of the Company.
(a) Substitute Shares . Any shares or
other security received as a result of any stock dividend, stock
split, or reorganization will be subject to the same terms,
conditions, and restrictions as those relating to the Restricted
Stock granted under this Agreement.
(b) Registration . Certificates for the
shares of stock evidencing the Restricted Stock will not be issued
but the shares will be registered in Grantee’s name in book
entry form as soon as administratively feasible after
Grantee’s acceptance of this Agreement.
6. Termination of Employee Status .
If Grantee ceases to be an employee of the Company, except as
otherwise provided in any Employment Agreement or Change in Control
Compensation Agreement that may exist between Grantee and the
Company from time to time (an “Other
Agreement”):
(a) Termination Due to Disability or
Death . By reason of disability (as defined in the Plan or in
any Other Agreement to which Grantee is a party)
(“Disability”) or death, the shares of Restricted Stock
will vest on the date of death or Disability.
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(b) Retirement . By reason of retirement
at or after age 65, the shares of Restricted Stock will continue to
vest in the same manner as though employment had not terminated. If
unforfeited Restricted Stock remains unvested at Grantee’s
death following retirement from employment at or after attainment
of age 65, the shares of Restricted Stock will vest on the date of
death.
(c) Termination for Reason Other Than
Retirement, Disability or Death . For any reason other than
death, Disability, or retirement at or after age 65, with or
without cause, no further vesting of Restricted Stock will occur
and any shares of Restricted Stock still subject to restrictions or
which have not yet vested as of the date of termination of
employment will automatically be forfeited and returned to the
Company.
Any provision regarding vesting of restricted
stock upon termination of employment set forth in an Other
Agreement shall govern the vesting of the Restricted Stock under
this Agreement. Further, notwithstanding the foregoing, if at any
time upon or following termination of employment the Committee
determines that reason to terminate the Grantee for cause, as
defined in the Plan, exists at the time of termination or existed
at such time, all shares of Restricted Stock for which restrictions
have not lapsed or which have not yet vested will be forfeited to
the Company.
7. Employment by the Company .
Nothing in this Agreement imposes upon the Company any obligation
to retain Grantee in the employ of the Company for any given period
or upon any specific terms of employment. Grantee acknowledges
that, except as otherwise agreed by the Company in a signed written
agreement, Grantee’s employment is at will and terminable by
Grantee or the Company at any time and for any reason.
8. Tax
Withholding. Grantee authorizes the Company to:
(a) Withhold . Withhold and deduct from
future wages of Grantee (or from other amounts that may be due and
owing to Grantee from the Company), or make other arrangements,
including arrangements for the surrender of shares of the Company
Common Stock previously owned by Grantee or surrender of shares of
then vesting Restricted Stock in each case with a fair market value
equal to the amount to be withheld, for the collection of, all
amounts deemed necessary to satisfy any and all federal, state, and
local withholding and employment-related tax requirements
attributable to an award of Restricted Stock (including any taxes
arising under Sections 409A or 4999 of the Code);
or
(b) Remit . Require Grantee promptly to
remit the amount of such withholding to the Company before taking
any action with respect to the Restricted Stock.
9.
Acknowledgment . By signing this Agreement and accepting the
Restricted Stock, Grantee:
(a) Representation . Acknowledges
acceptance of the Restricted Stock and receipt of the documents
referred to in this Agreement, represents that Grantee is familiar
with the provisions of the Plan and agrees to its incorporation in
the Agreement, agrees to all of the other terms and conditions of
the Agreement and agrees to promptly provide any information with
respect to the Restricted Stock reasonably requested by the
Company;
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(b) Taxes . Agrees to comply with the
requirements of applicable federal and other laws with respect to
withholding or providing for the payment of required taxes
(including any taxes arising under Sections 409A of the
Code);
(c) Limitation of Rights . Acknowledges
that all of Grantee’s rights to the Restricted Stock are
embodied in the Agreement and in the Plan, except as set forth in
an Other Agreement;
(d) Employment . Agrees that while
Grantee is employed by the Comp
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