EXHIBIT 10.12
Ionics, Incorporated
1994 Restricted Stock Plan
Adopted August 23, 1994
1. Purpose.
The purpose of this Restricted Stock Plan (the "Plan") is to attract,
motivate, and retain outstanding individuals as employees of Ionics,
Incorporated (the "Corporation") and its Subsidiaries, as hereinafter
defined, to align their future interests with those of the Corporation's
stockholders, and to reward appropriately those who make substantial
contributions to the success and welfare of the Corporation.
2. Stock Subject to the Plan.
The stock that may be granted under the Plan ("Restricted Stock") shall
be the Common Stock, $1.00 par value, of the Corporation. The maximum
total number of shares of such stock that may be issued under the Plan
shall be 150,000 shares (except as such amount may be adjusted in
accordance with the provisions of Section 9 hereof). Such shares may be
either unissued shares or treasury shares. No participant in the Plan may
be awarded more than 25,000 shares of Restricted Stock under the Plan in
any calendar year.
If previously awarded shares are forfeited to the Corporation by reason
of termination of employment during the applicable Restriction Period, or
for any other reason, such shares may again be awarded under the Plan,
provided that no more than 75,000 of such shares are so awarded again. In
the event the Corporation acquires or merges or consolidates with another
company, Common Stock issuable under the Plan as a result of the
Corporation's assumption of outstanding awards from such other company or
the substitution of grants under the Plan for outstanding awards of such
other company shall not reduce the shares available for grant under the
Plan.
3. Eligibility and Participation.
Individuals eligible to receive grants of Restricted Stock, as
hereinafter defined, under the Plan shall be those employees of the
Corporation and its Subsidiaries selected from time to time by the Plan's
administrative committee, provided, however, that each grant recipient must
have been employed by the Corporation or a Subsidiary for a period of at
least six months immediately preceding the date of grant. No person who is
not an officer or salaried employee of the Corporation or a Subsidiary
shall be eligible to receive a grant under the Plan. Grants made under the
Plan in any year shall neither preclude nor require selection of a grantee
to receive future grants or require that the grantee receive the same type
or amount of award as at any other time, or as may be received by any other
grant recipient at any time. Neither the Plan nor any action taken under
the Plan shall be construed as giving any grantee the right to be retained
in the employ of the Corporation or a Subsidiary.
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4. Administration of the Plan.
The Plan shall be administratered by a Committee (the "Committee")
appointed by, and to serve at the pleasure of, the Board of Directors of
the Corporation and consisting of three or more directors, each of whom is
a "disinterested person" within the meaning of Rule 16b-3 promulgated under
the Securities Exchange Act of 1934, or any successor provision, as
applicable to the Corporation at the time. Until the Board of Directors
shall otherwise determine, that Committee shall be the Compensation
Committee of the Board of Directors. Subject to the express provisions
hereof, the Committee shall have sole and complete authority to make grants
of Restricted Stock. Such authority shall include, but not be limited to,
selecting individuals to receive grants under the Plan, determining the
number of shares of Common Stock (subject to the limitations in Section 2
hereof) to be awarded to each grant recipient under the plan and the terms
and conditions under which such grants shall be made, and determining the
duration and terms of each Restriction Period.
The Committee also shall have authority to adopt rules and regulations
for carrying out the Plan and to interpret, construe, implement, and
otherwise administer the provisions of the Plan. Decisions of the
Committee shall be final. A majority of the Committee shall constitute a
quorum. The acts of a majority of the members present at any meeting at
which a quorum is present (or acts approved in writing by a majority of the
Committee) shall be the acts of the Committee. The Committee shall keep
minutes of its proceedings and from time to time make such reports to the
Board of Directors as the Board shall direct.
5. Effective Date.
The Effective Date of the Plan shall be the date upon which the Plan is
adopted by the Board of Directors of the Corporation. The Plan shall
terminate if it is not approved within twelve months after the Effective
Date by vote of the holders of a majority of the stock of the Corporation
present in person or by proxy and entitled to vote at a special or annual
meeting of the stockholders of the Corporation.
6. Terms and Conditions of Grants.
6.1 Grants under the Plan shall consist of Restricted Stock, which
shall be shares of Common Stock of the Corporation transferred to grant
recipients in furtherance of the purposes of the Plan without, unless
otherwise provided, other payment and subject to the restrictions referred
to in this Section 6. All shares of Restricted Stock granted under the
Plan shall be so granted for, and in consideration of, past services
rendered to the Corporation or a Subsidiary and shall be subject to the
following terms and conditions and to such other terms and conditions, not
inconsistent with the Plan, as shall be prescribed by the Committee in its
sole discretion and as shall be contained in the Agreement referred to in
Section 6.1(d) hereof.
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(a) At the time of a grant of shares of Restricted Stock, the
Committee shall establish for all such shares received by a grantee
(or, if it is the intent that the total of such shares shall be divided
into separate parts, for each part of such total) a period of time (the
"Restriction Period") commencing with the date of the grant of such
shares during which time the shares may not be sold, assigned,
transferred, pledged, or otherwise encumbered, except as herein
provided. Different Restriction Periods may be fixed for different
parts of the shares that are being granted to a recipient, and the
Restriction Period for one grant may differ from the Restriction Period
for other grants. Unless otherwise determined by the Committee, the
Restriction Period will be five (5) years, so that twenty percent (20%)
of the shares constituting a particular grant shall become free of
restrictions on each of the first five anniversary dates from the date
of grant. Except for such restrictions, unless otherwise determined by
the Committee, the grant recipient as owner of such Restricted Stock
shall have all the rights of a stockholder, including but not limited
to the right to receive any dividends paid on such Restricted Stock and
the right to vote such Restricted Stock. Unless otherwise determined
by the Committee, the restrictions shall terminate upon the earliest to
occur of the expiration of the Restriction Period or the grantee's
death, disability, or retirement at normal retirement age, or in any
other circumstances determined by the Committee at the time of the
grant or at any time thereafter.
(b) If a grant recipient ceases to be an employee of the Corporation
or a Subsidiary, all shares of Restricted Stock theretofore granted to
him as to which the restrictions imposed under this Section 6 have not
terminated or do not thereby terminate shall, except as provided in
Section 7 hereof, upon such cessation of employment be forfeited and
returned to the Corporation unless the Committee, in its discretion,
otherwise determines.
(c) Each certificate issued in respect of shares of Restricted Stock
granted under the Plan shall be registered in the name of the grantee
and deposited by him, together with a stock power endorsed in blank,
with the Corporation and shall bear the following (or a similar)
legend:
"The transferability of this certificate and the shares of stock
represented hereby are subject to the terms, conditions and
restrictions (including forfeiture) contained in a Plan and an
Agreement between the registered owner and Ionics, Incorporated.
A copy of such Plan and Agreement will be furnished to the holder
of this certificate upon written request and without charge."
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(d) The grant recipient shall enter into an Agreement with the
Corporation, in a form no inconsistent with the Plan, agreeing to the
terms and conditions of the grant and such other matters as the
Committee shall in its sole discretion determine. the Agreement may be
amended by the Committee at any time to modify the Restriction Period
with respect to any shares of Restricted Stock the restrictions on
which have not then lapsed or in any other respect; provided that,
except as provided in Section 12, no amendment shall adversely affect
the terms and conditions of an outstanding grant without the written
consent of the grant recipient.
(e) Upon the termination of the restrictions imposed under this
Section 6, the Corporation shall return to the grantee ( or his legal
representative, beneficiary, or heir) certificates, without a legend,
for the shares of Common Stock deposited with it pursuant to subsection
(c) hereof.
6.2 The Corporation or a Subsidiary, as the case may be, shall have
the right to deduct from amounts payable to the grantee, or to require the
grantee to pay, any taxes required by law to be withheld with respect to
such Restricted Stock. In the Committee's discretion such tax obligations
may be paid in whole or in part in shares of Common Stock, including shares
retained from the grant creating the tax obligation, valued at their fair
market value on the date of delivery.
6.3 No rights or interests of a grant recipient under the Plan may be
assigned, encumbered, or transferred except by will or the laws of descent
and distribution.
7. Change in Control.
In order to preserve the rights of a grant recipient in the event of a
merger or consolidation of the Corporation with another corporation or of a
Change in Control of the Corporation, the Committee may in its discretion
include in the grant Agreement or in any amendment thereto (subject to the
provisions of Section 6.1(d): (i) permitting restrictions on Restricted
Stock to lapse, in whole or in part, immediately prior to such event; (ii)
adjusting the terms of a grant in a manner determined by the Committee to
reflect the Change in Control; (iii) causing a grant to be assumed, or new
rights substituted therefor, by another entity; and/or (iv) making such
other provision as the Committee may consider equitable and in the best
interests of the Corporation. After a Change in Control of the
Corporation, the Corporation shall pay all reasonable legal fees, costs,
and other expenses incurred by any grantee in enforcing rights under this
Plan or the grant Agreement.
A "Change in Control" shall be deemed to have occurred if (a) any
entity, person or Group (other than the Company or a subsidiary) acquires
shares of Common Stock in a transaction or in a series of transactions that
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result in such entity, person or Group directly or indirectly owning
beneficially more than thirty percent (30%) of the outstanding shares of
Common Stock; (b) there is a merger, consolidation or sale of all or
substantially all of the assets of the Company; (c) there is a contested
election of directors of the Company which results in a majority of the
members of the Board recommended by the Company not being elected; (d)
there is a change in composition within a sixty (60) day period of a
majority of the Company's Board of Directors; or (e) there is any other
event which results in a change in voting power sufficient to elect a
majority of the Board.
A "Group" shall consist of two or more persons acting as a partnership,
limited partnership, syndicate, or other group for the purpose of
acquiring, holding or disposing of voting securities of the Company.
8. Securities and Other Laws.
In any case where in the opinion of the Committee, the issue and/or
delivery of shares of Common Stock under the Plan would violate
requirements of Federal or state securities or other laws, or the
requirements of any exchange on which the securities are listed, the
Corporation shall be entitled to postpone such issue and/or delivery until
such requirements have been met. The Committee may require representations
and agreements from any grant recipient in order to ensure compliance with
Federal or state securities or other laws.
9. Adjustment in Number of Shares.
In the event that there are any changes in the outstanding Common Stock
of the Corporation by reason of stock dividends, stock splits, or
recapitalizations (whether by way of mergers, consolidations, combinations,
or exchanges or shares or the like) the aggregate number and kind of shares
available under the Plan shall be appropriately adjusted by the Committee,
if necessary, to reflect equitably such change or changes. Any shares of
stock or other securities received by a grant recipient with respect to
shares still subject to the restrictions imposed by Section 6 will be
subject to the same restrictions and shall be deposited with the
Corporation in accordance with Section 6.
10. Notice of Election Under Section 83(b).
Each grant recipient making an election under Section 83(b) of the
Internal Revenue Code of 1986, as amended, and the regulations and rulings
promulgated thereunder, will provide a copy thereof to the Corporation
within thirty days of the filing of such election with the Internal Revenue
Service and the Agreement referred to in Section 6 shall so provide.
11. Term of Plan.
Unless sooner terminated the Plan shall terminate ten years from the
Effective Date and no Restricted Stock shall be granted thereafter.
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12. Amendments and Termination.
The Plan or any portion hereof may be amended at any time and from time
to time or terminated by the Board of Directors, subject to such approval
of the stockholders as the Board of Directors shall deem necessary or
advisable. No amendment or termination shall adversely affect the terms
and conditions of outstanding grants without the written consent of the
grantee, except that the Plan and any Agreement may be amended without the
consent of any grant recipient in order to conform to restrictions or
limitations imposed by securities or tax laws or regulations, or any other
laws or regulations deemed by the Corporation to be binding upon it.
13. Miscellaneous.
13.1 Transfer of Employment. The transfer of employment of an
employee from the Corporation to a Subsidiary or from a Subsidiary to the
Corporation or to another Subsidiary shall not constitute a termination of
employment for the purposes of the Plan.
13.2 Definition of Subsidiary. For all purposes of the Plan, the term
"Subsidiary" means any corporation of which the Corporation owns or
controls more than 50% of the outstanding shares of capital stock entitled
ordinarily (rather than in some contingency) to vote for the election of
directors (counting shares owned or controlled by a Subsidiary within this
definition as being owned or controlled by the Corporation).
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