Exhibit 10(iii)A(4)
Page 36
NATIONAL SERVICE INDUSTRIES, INC.
LONG-TERM ACHIEVEMENT INCENTIVE PLAN
RESTRICTED STOCK AWARD AGREEMENT
THIS AGREEMENT, made and entered into as of the 24th day of October, 2000, by
and between NATIONAL SERVICE INDUSTRIES, INC., a Delaware Corporation, (the
"Company") and ("Grantee").
W o I o T o N o E o S o S o E o T o H t o h o a o t:
WHEREAS, the Company maintains the National Service Industries, Inc. Long-Term
Achievement Incentive Plan (the "Plan"), and Grantee has been selected by the
Committee to receive one or more Restricted Stock Awards under the Plan;
NOW, THEREFORE, IT IS AGREED, by and between the Company and Grantee, as
follows:
1. Awards of Restricted Stock
1.1 The Company hereby grants to Grantee an award of Shares of
restricted stock ("Restricted Stock"), subject to, and in accordance with, the
restrictions, terms, and conditions set forth in this Agreement. The grant date
of this award of Restricted Stock is October 24, 2000 (the "Grant Date"), and
the average of the high and low prices of a Share on the New York Stock Exchange
on the Grant Date is $19.25.
1.2 This Agreement (including any appendices) shall be construed in accordance
with, and subject to, the provisions of the Plan (the provisions of which are
incorporated herein by reference) and, except as otherwise expressly set forth
herein, the capitalized terms used in this Agreement shall have the same
definitions as set forth in the Plan.
2. Restrictions
2.1 Subject to Sections 2.3, 2.4, and 2.6 below, the Restricted Stock shall not
begin to vest until the date (the "Vesting Start Date") on which the closing
price of the Company's common stock on the New York Stock Exchange for a
consecutive 30-day period (the "Stock Price Target") equals or exceeds the Stock
Price Target indicated below with respect to the Shares of Restricted Stock;
provided, however, that if the Stock Price Target has not reached the level
provided below on or before the fifth anniversary of the Grant Date, all
corresponding Shares of Restricted Stock for such Stock Price Target shall be
immediately forfeited and shall not be subject to any future vesting.
Exhibit 10(iii)A(4)
Page 37
Number of Shares Stock Price Target
of Restricted Stock for Vesting Start Date
------------------- ----------------------
Target Shares $22.1375
Target Shares $25.0250
Target Shares $27.9125
Target Shares $30.8000
Target Shares $33.6875
2.2 Except as provided in Section 2.3, 2.4, and 2.6 below, once the Vesting
Start Date has been reached for a portion of the Shares of Restricted Stock,
those Shares of Restricted Stock shall vest as follows during Grantee's
employment: on each anniversary of the Vesting Start Date (each such date shall
be a "Vesting Date"), 25% of the Shares of Restricted Stock shall vest such that
on the 4th anniversary of the Vesting Start Date (the "Final Vesting Date") all
of those Shares of Restricted Stock shall be fully vested.
On each Vesting Date, Grantee shall own the Vested Shares of Restricted Stock
free and clear of all restrictions imposed by this Agreement (except those
imposed by Section 3.4 below). The Company shall deliver a certificate(s) for
the Vested Shares of Restricted Stock to Grantee as soon as practical after each
Vesting Date. For purposes of this Agreement, employment with a Subsidiary of
the Company shall be considered employment with the Company.
2.3 In the event, prior to the Final Vesting Date, (i) Grantee dies while
actively employed by the Company, or (ii) Grantee has his employment terminated
by reason of Disability, any Restricted Stock for which the appropriate Stock
Price Target has been reached and a Vesting Start Date has been established
shall become fully vested and nonforfeitable as of the date of Grantee's death
or Disability and all Restricted Stock for which the Stock Price Target has not
been reached shall be immediately forfeited. The Company shall deliver
certificate(s) for the vested Restricted Stock, free and clear of any
restrictions imposed by this Agreement (except for Section 3.4) to Grantee (or,
in the event of death, his surviving spouse or, if none, to his estate) as soon
as practical after his date of death or termination for Disability.
2.4 If Grantee retires from the Company on or after attaining (i) age 65, or
(ii) age 55 with 10 years of service, the vesting of the Restricted Stock
(including the commencement of vesting by establishing a Vesting Start Date upon
reaching a Stock Price Target) shall continue as if Grantee were an active
employee, unless within two (2) years of his date of termination Grantee
violates the Restrictive Covenant (Non-Competition Agreement) attached as
Exhibit "A" hereto, at which time all unvested Shares of Restricted Stock
(whether or not a Vesting Start Date has been established for such Shares) shall
immediately be forfeited. If Grantee dies after retiring under this Section 2.4,
but prior to the Final Vesting Date for any Shares of Restricted Stock, then any
Restricted Stock for which the appropriate Stock Price Target has been reached
Exhibit 10(iii)A(4)
Page 38
and a Vesting Start Date has been established shall become fully vested and
nonforfeitable as of the date of Grantee's death and all Restricted Stock for
which the Stock Price Target has not been reached shall be immediately
forfeited.
2.5 Except for death or Disability as provided in Section 2.3 or retirement as
provided in Section 2.4, if Grantee terminates his employment or if the Company
terminates Grantee prior to the Final Vesting Date, the Restricted Stock shall
cease to vest further, the unvested Shares of Restricted Stock shall be
immediately forfeited, and Grantee shall only be entitled to the Restricted
Stock that is vested as of his date of termination.
2.6 Notwithstanding the other provisions of this Agreement, in the event of a
Change in Control prior to Grantee's Final Vesting Date, all Shares of
Restricted Stock (whether or not the corresponding Stock Price Target had been
attained) shall become fully vested and nonforfeitable as of the date of the
Change in Control. On the date of the Change in Control, the Company shall
deliver to Grantee a certificate(s) for the Restricted Stock, free and clear of
any restrictions imposed by this Agreement.
2.7 The Restricted Stock may not be sold, assigned, transferred, pledged, or
otherwise encumbered prior to the date Grantee becomes vested in the Restricted
Stock.
3. Stock; Dividends; Voting
3.1 The Restricted Stock shall be registered on the Company's books in the name
of Grantee only as of the respective Vesting Start Date for such Shares of
Restricted Stock. The Company may issue stock certificates or evidence Grantee's
interest by using a book entry account. Physical possession or custody of any
stock certificates that are issued shall be retained by the Company until such
time as the Shares are vested in accordance with Section 2. The Company reserves
the right to place a legend on the stock certificate(s) restricting the
transferability of such certificates and referring to the terms and conditions
(including forfeiture) of this Agreement and the Plan.
3.2 After a Vesting Start Date has occurred with respect to certain Shares of
Restricted Stock, Grantee shall be entitled to receive dividends and/or other
distributions declared on such Restricted Stock and Grantee shall be entitled to
vote such Restricted Stock, provided that these rights shall cease in the event
such Restricted Stock is forfeited.
3.3 In the event of a Change in Capitalization, the number and class of Shares
or other securities that Grantee shall be entitled to, and shall hold, pursuant
to this Agreement shall be appropriately adjusted or changed to reflect the
Change in Capitalization, provided that any such additional Shares or additional
or different shares or securities shall remain subject to the restrictions in
this Agreement.
Exhibit 10(iii)A(4)
Page 39
3.4 Grantee represents and warrants that he is acquiring the Restricted Stock
for investment purposes only, and not with a view to distribution thereof.
Grantee is aware that the Restricted Stock may not be registered under the
federal or any state securities laws and that, in addition to the other
restrictions on the Shares, they will not be able to be transferred unless an
exemption from registration is available or the Shares are registered. By making
this award of Restricted Stock, the Company is not undertaking any obligation to
register the Restricted Stock under any federal or state securities laws.
4. No Right to Continued Employment
Nothing in this Agreement or the Plan shall be interpreted or construed to
confer upon Grantee any right with respect to continuance of employment by the
Company or a subsidiary, nor shall this Agreement or the Plan interfere in any
way with the right of the Company or a Subsidiary to terminate Grantee's
employment at any time.
5. Taxes and Withholding
Grantee shall be responsible for all federal, state, and local income taxes
payable with respect to this award of Restricted Stock. Grantee shall have the
right to make such elections under the Internal Revenue Code of 1986, as
amended, as are available in connection with this award of Restricted Stock. The
Company and Grantee agree to report the value of the Restricted Stock in a
consistent manner for federal income tax purposes. The Company shall have the
right to retain and withhold from any payment of Restricted Stock the amount of
taxes required by any government to be withheld or otherwise deducted and paid
with respect to such payment. At its discretion, the Company may require Grantee
to reimburse the Company for any such taxes required to be withheld and may
withhold any distribution in whole or in part until the Company is so
reimbursed. In lieu thereof, the Company shall have the right to withhold from
any other cash amounts due to Grantee an amount equal to such taxes required to
be withheld or withhold and cancel (in whole or in part) a number of shares of
Restricted Stock having a market value not less than the amount of such taxes.
6. Grantee Bound By The Plan
Grantee hereby acknowledges receipt of a copy of the Plan and the prospectus for
the Plan, and agrees to be bound by all the terms and provisions thereof.
7. Modification of Agreement
This Agreement may be modified, amended, suspended, or terminated, and any terms
or conditions may be waived, but only by a written instrument executed by the
parties hereto.
Exhibit 10(iii)A(4)
Page 40
8. Severability
Should any provision of this Agreement be held by a court of competent
jurisdiction to be unenforceable or invalid for any reason, the remaining
provisions of this Agreement shall not be affected by such holding and shall
continue in full force in accordance with their terms.
9. Governing Law
The validity, interpretation, construction, and performance of this Agreement
shall be governed by the laws of the State of Delaware without giving effect to
the conflicts of laws principles thereof.
10. Successors in Interest
This Agreement shall inure to the benefit of, and be binding upon, the Company
and its successors and assigns, whether by merger, consolidation,
reorganization, sale of assets, or otherwise. This Agreement shall inure to the
benefit of Grantee's legal representatives. All obligations imposed upon Grantee
and all rights granted to the Company under this Agreement shall be final,
binding, and conclusive upon Grantee's heirs, executors, administrators, and
successors.
11. Resolution of Disputes
Any dispute or disagreement which may arise under, or as a result of, or in any
way relate to the interpretation, construction, or application of this Agreement
shall be determined by the Committee. Any determination made hereunder shall be
final, binding, and conclusive on Grantee and the Company for all purposes.
Exhibit 10(iii)A(4)
Page 41
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written.
ATTEST: NATIONAL SERVICE INDUSTRIES, INC.
____________________________________________ By:__________________________________________________
Helen D. Haines, Secretary James S. Balloun,
Chairman, President, and
Chief Executive Officer
GRANTEE:
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