EXHIBIT 10.7
A. T. CROSS COMPANY
RESTRICTED STOCK PLAN
This A. T. Cross Company Restricted Stock Plan (the "Plan") is adopted
by A. T. Cross Company, a Rhode Island corporation (the "Company"), for the
purpose of providing restricted stock awards in payment of certain bonuses
earned under the A.T. Cross Company Annual Incentive Plan.
1. Definitions. For purposes of the Plan, the following terms shall
have the meanings set forth below:
"Board" means the Board of Directors of A. T. Cross Company.
"Change in Control" means (i) a change in the beneficial ownership (as
defined in Rule 16a-1(a)(2)) of more than 50% of the Class B Common Stock
of the Company, (ii) approval by Company stockholders of a consolidation, a
merger in which the Company will not be the surviving corporation, or the
sale of substantially all of the Company's assets.
"Class B Common Stock" means the Class B Common Stock, $1.00 par value
of the Company.
"Committee" means the Compensation Committee of the Board or a
substitute committee appointed by the Board of the Company, consisting of
at least two directors, each of whom is a "disinterested person", as
defined in Rule 16b-3, with respect to the Plan.
"Common Shares" means the Class A Common Stock, $1.00 par value, of
the Company.
"Disability" means a determination by the Committee that a Participant
is unable to perform the duties required of the Participant by the Company
as a result of physical or mental impairment.
"Market Price" means the average of the highest and lowest price of
the Company's Common Shares as reported by the American Stock Exchange.
"OIBT" for any period means the audited operating income before taxes
of the Company's writing instrument division for such period.
"Participant" means an employee who receives an award of Restricted
Shares under the Plan as determined by the Committee.
"Restricted Period" means the period commencing with the award of
Restricted Shares and terminating in accordance with the provisions of
Paragraph 7 or Paragraph 9 hereof.
"Restricted Shares" means Common Shares which are awarded subject to
the restrictions described in Paragraph 7 hereof.
"Rule 16a-1(a)(2)" means Rule 16a-1(a)(2) promulgated by the
Securities and Exchange Commission under Section 16(a) of the Securities
Exchange Act of 1934.
"Rule 16b-3" means Rule 16b-3 promulgated by the Securities and
Exchange Commission under Section 16(b) of the Securities Exchange Act of
1934.
2. Administration. The Plan shall be administered by the Committee.
The Committee may establish, subject to the provisions of the Plan, such
rules and regulations as it deems necessary for the proper administration
of the Plan, and make such determinations and take such actions in
connection therewith or in relation to the Plan as it deems necessary or
advisable, consistent with the Plan.
3. Eligibility. Employees of the Company who are eligible to
participate in the Annual Incentive Plan shall be eligible to participate
in the Plan as determined by the Committee.
4. Shares Subject to the Plan. The Common Shares to be issued as
Restricted Shares under the Plan may be either authorized but unissued
shares or treasury shares. The aggregate number of Common Shares of the
Company which may be issued under the Plan shall not exceed 60,000 shares;
subject, however, to the adjustment provided in Paragraph 11 in the event
of stock splits, stock dividends, exchanges of shares or the like occurring
after the effective date of the Plan. No Restricted Shares may be issued
under the Plan which could cause such maximum limit to be exceeded.
5. Awards of Restricted Shares. Awards of Restricted Shares pursuant
to the Plan shall be made to eligible employees in full or partial payment
of bonuses earned under the Annual Incentive Plan as determined by the
Committee. The number of Restricted Shares awarded in the case of any
bonus shall be equal to the cash value of the bonus earned under the Annual
Incentive Plan which is to be paid in Restricted Shares divided by the
Market Price on the last trading day of the fiscal year for which the bonus
was earned. Fractional shares shall be paid in cash.
Each award of Restricted Shares shall be embodied in a "Restricted
Share Agreement" signed by the Participant and the Company and providing
that the Restricted Shares shall be subject to the provisions of the Plan
and containing such other provisions as the Committee may prescribe not
inconsistent with the Plan.
6. Rights and Obligations with Respect to Stock. Upon the award of
Restricted Shares pursuant to the Plan, there shall be issued in the name
of each Participant a certificate or certificates representing the
Restricted Shares awarded, and the Participant shall thereupon be a
stockholder and have all the rights of a stockholder with respect to such
shares, including the right to vote and receive all dividends or other
distributions made or paid with respect to such shares; provided however,
that such Restricted Shares, and any new, additional or different
securities the Participant may become entitled to receive with respect to
such Restricted Shares by virtue of a stock split, dividend or any other
change in the corporate or capital structure of the Company, shall be
subject to the restrictions described in Paragraph 7 hereof. Certificates
for Restricted Shares shall be held by the Company on behalf of a
Participant until the termination of the Restricted Period as provided in
Paragraph 7(b) or Paragraph 9 hereof.
7. Specific Restrictions. All Restricted Shares held by a
Participant shall be subject to the following restrictions:
(a) During the Restricted Period, the shares may not be sold,
exchanged, transferred, pledged, hypothecated, or otherwise disposed of by
the Participant other than by will or the laws of descent and distribution.
(b) If OIBT for the fiscal year immediately preceding the fiscal year
in which an award of Restricted Shares is made is less than $25,000,000,
the Restricted Period shall terminate with respect to one-half of such
award at the end of the fiscal year for which OIBT equals or exceeds
$25,000,000; the Restricted Period for the remaining one-half of the
Restricted Shares will terminate at the end of the fiscal year for which
OIBT is equal to or greater than two times OIBT for the calendar year 1994.
If OIBT for the fiscal year immediately preceding the fiscal year in which
an award of Restricted Shares is made is equal to or greater than
$25,000,000, the Restricted Period shall terminate at the end of the fiscal
year for which OIBT is equal to or greater than two times OIBT for the
fiscal year 1994. If OIBT is not at least two times the 1994 OIBT by the
end of the 1999 fiscal year, any remaining Restricted Shares will be
forfeited by the Participant and revert to the Company.
(c) Upon the termination of the Restricted Period with respect to
Restricted Shares, such shares shall no longer be considered Restricted
Shares and shall be delivered to the Participant or the Participant's
permitted assigns as soon as reasonably practicable following the
determination by the Committee that such termination is in accordance with
the terms of the Plan.
(d) Restricted Shares awarded by the Committee under the Plan shall
be issued only in full compliance with all applicable securities laws,
including laws, rules and regulations of the Securities and Exchange
Commission and applicable state Blue Sky laws. With respect thereto, the
Committee may impose such conditions on transfer, restrictions and
limitations as it may deem necessary and appropriate to assure compliance
with such applicable securities laws.
8. Termination of Employment During Restricted Period. Unless the
Committee determines otherwise at the time of award or any time subsequent
thereto, if a Participant's employment with the Company is terminated
during the Restricted Period other than by reason of death or Disability,
the Participant shall thereupon forfeit all Restricted Shares and all
rights with respect thereto shall terminate.
Unless the Committee shall otherwise determine at the time of award or
any time subsequent thereto, if a Participant's employment with the Company
is terminated during the Restricted Period because of death or Disability,
the restrictions contained in Paragraph 7(a) hereof shall terminate as
provided in Paragraph 7 (b) hereof.
9. Change in Control. Unless the Committee in its sole discretion
shall determine otherwise, upon a Change in Control, all Restricted Periods
shall end, and the restrictions applicable to all previous awards of
Restricted Shares shall terminate.
10. Section 83(b) Elections. A Participant who files an election
with the Internal Revenue Service to include the fair market value of any
Restricted Shares in gross income during a Restricted Period shall promptly
furnish the Company with a copy of such election together with the amount
of any federal, state, local or other taxes required to be withheld to
enable the Company to claim an income tax deduction with respect to such
election.
11. Share Adjustments. In the event there is any change in the
Company's Common Shares resulting from stock splits, stock dividends,
combinations or exchanges of shares, or other similar capital adjustments,
equitable proportionate adjustments shall automatically be made without
further action by the Committee in (i) the number of shares available for
award under the Plan, and (ii) the number of Restricted Shares then held
for the accounts of Participants under the Plan.
12. Amendment or Termination. The Committee may terminate this Plan
at any time, and may amend the Plan at any time or from time to time;
provided, however, that any amendment that would increase the aggregate
number of shares that may be issued under the Plan, materially increase the
benefits accruing to employees under the Plan, or materially modify the
requirements as to eligibility for participation in the Plan shall be
subject to the approval of the Company stockholders to the extent required
by Rule 16b-3, or other applicable laws or any other governing rules or
regulations, except that any such increase or modification that may result
from adjustments authorized by Paragraph 11 hereof shall not require such
approval. If the Plan is terminated, any Restricted Shares shall continue
to be subject to the terms of this Plan for the duration of the Restricted
Period.
13. Tax Withholding. Any award of Restricted Shares hereunder shall
provide appropriate arrangements for the satisfaction by the Company and
Participant of all federal, state, local or other income, excise or
employment taxes or tax withholding requirements applicable to the receipt
of Restricted Shares as determined by the Committee.
14. No Effect on Employment Status. The fact that an employee has
been granted Restricted Shares under this Plan shall not limit or otherwise
qualify the right of the Company to terminate the employee's employment at
any time.
15. Effective Date of the Plan. The Plan shall become effective upon
the approval of the Plan by the Company's Board and the holders of the
Class B Common Stock.
16. Rhode Island Law to Govern. This Plan shall be construed and
administered in accordance with and governed by the laws of the State of
Rhode Island.
IN WITNESS WHEREOF, the Company has caused this Restricted Stock Plan
to be executed by its duly authorized officer as of this 27th day of April,
1995.
A. T. CROSS COMPANY
By:_/s/ John E. Buckley_____________________
Title: Executive Vice President and
Chief Operating Officer