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AMENDED AND RESTATED
RESTRICTED SHARES AGREEMENT (STOCK AWARD)
FOR JOHN BRAM BARTLING, JR.
WHEREAS, John Bram Bartling, Jr. ("Employee") and Cardinal Realty
Services, Inc. ("Company") have heretofore entered into that certain Employment
dated as of December 1, 1995, as amended (as the same may be further amended,
restated, amended and restated, modified, or supplemented from time to time
after the date hereof (and, for purposes of this agreement, irrespective of the
fact that such Employment Agreement may have expired at any time while this
agreement remains in effect), the "Employment Agreement) as well as that certain
Restricted Shares Agreement (Stock Award) dated as of April 15, 1996;
WHEREAS, Company has established its Executive Deferred Compensation
Plan dated as of April 18, 1996 ("Deferred Compensation Plan") and Employee is
entitled to participate in the Deferred Compensation Plan in accordance with its
terms;
WHEREAS, pursuant to the Plan, the Company has further entered into
that certain Executive Deferred Compensation Rabbi Trust Agreement (the "Trust")
with The Provident Bank, a state-chartered bank, as trustee thereunder
("Trustee");
WHEREAS, in accordance with the terms of the Deferred Compensation
Plan, Employee has elected to cause the twenty-two thousand five hundred
(22,500) shares of the Company's common stock, without par value (the "Shares"),
otherwise issuable to him under the terms of the Restricted Shares Agreement
(Stock Award) to be instead issued to the Trustee for Employee's benefit to be
held by the Trustee in accordance with the terms of the Trust;
WHEREAS, as a result of the Employee's election under the Deferred
Compensation Plan, Employee and the Company have agreed to amend and restate the
Restricted Shares Agreement (Stock Agreement) hereby so that the Shares will be
issued to the Trustee for Employee's benefit in accordance with the terms of the
Deferred Compensation Plan (and the Trust) rather than directly to Employee
pursuant to the Company's Amended and Restated 1992 Incentive Equity Plan as
originally contemplated by the Restricted Shares Agreement (Stock Award).
NOW, THEREFORE, pursuant to the Deferred Compensation Plan effective as
of April 15, 1996 (the "Date of Grant"), the Company grants to Trustee for
Employee's benefit under the terms of the Trust, the Shares subject to the
terms, conditions, limitations and restrictions hereinafter set forth. Terms
used herein and not otherwise defined shall have the meanings assigned to them
in the Deferred Compensation Plan.
1. Issuance of Shares. The Shares covered by this agreement are shares
of Other Restricted Stock within the meaning of the Deferred Compensation Plan
and shall be fully paid and nonassessable and shall be represented by a
certificate(s) registered in the name of the Trustee and bearing a legend
referring to the restrictions hereinafter set forth.
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2. Restrictions on Transfer of the Shares. The Shares subject to this
agreement may not be transferred, sold, pledged, exchanged, assigned or
otherwise encumbered or disposed of, except to the Company, and shall remain the
sole property of and subject to the Trust until they have become nonforfeitable
in accordance with Section 3 hereof and for so long thereafter as may be
required under the terms of the Deferred Compensation Plan and the Trust. Any
purported transfer, encumbrance or other disposition of the Shares covered by
this agreement that is in violation of this Section 2 shall be null and void,
and the other party to any such purported transaction shall not obtain any
rights to or interest in the Shares covered by this agreement. The Company may
waive the restrictions set forth in this Section 2 (but not in the Deferred
Compensation Plan or the Trust) with respect to all or any portion of the Shares
covered by this agreement.
3. Vesting of the Shares.
(a) One-third of the Shares covered by this agreement, shall
become nonforfeitable on the third, fourth and fifth anniversaries of
the Date of Grant (so that 100% of the Shares will be nonforfeitable on
the fifth anniversary of the Date of Grant), subject to the Employee
remaining in the continuous employ of the Company or a subsidiary
during the applicable vesting period. For the purposes of this
agreement: "subsidiary" shall mean a corporation, partnership, joint
venture, unincorporated association or other entity in which the
Company has a direct or indirect ownership or other equity interest of
more than fifty percent (50%); the continuous employment of the
Employee with the Company or a subsidiary shall not be deemed to have
been interrupted, and the Employee shall not be deemed to have ceased
to be an employee of the Company or a subsidiary, by reason of (i) the
transfer of his employment among the Company and its subsidiaries, (ii)
a leave of absence approved by the Compensation Committee of the
Company's Board of Directors (the "Committee") for illness, military or
governmental service or other reasons; or (iii) absence or inability to
work due to sickness or disability before being deemed Permanently
Disabled and terminated as set forth under the Employment Agreement.
(b) Notwithstanding the vesting provisions of Section 3(a)
hereof, in the event that Employee's employment with the Company
ceases, any Shares not vested will be forfeited.
(c) Notwithstanding the vesting provisions of Sections 3(a)
and (b) hereof, in the event that Employee's employment ceases by
reason of (i) Employee's death, (ii) Employee's Permanent Disability
(as defined in the Employment Agreement) or (iii) the Company's
termination of Employee's employment without "cause" (as defined in the
Employment Agreement) or in the event the Employment Agreement is not
renewed and the Company terminates Employee's employment with the
Company for any reason other than "cause", all of the Shares covered by
this agreement shall become immediately nonforfeitable.
(d) Notwithstanding the vesting provisions of Sections 3(a) ,
(b) and (c) hereof, all of the Shares granted under this Agreement
shall become immediately nonforfeitable if (A)
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the Company shall be merged or consolidated with, another corporation
and as a result of such merger or consolidation less than seventy
percent (70%) of the outstanding voting securities of the surviving or
resulting corporation shall be owned in the aggregate by the former
shareholders of the Company as the same shall have existed immediately
prior to such merger or consolidation; (B) the Company shall sell or
transfer to one or more persons, corporations or entities, in a single
transaction or a series of related transactions, more than one-half of
the assets of the Company unless by an affirmative vote of two-thirds
of the members of the Board of Directors of the Company, the
transaction or transactions are exempted from the operation of this
provision based on a good faith finding that the transaction or
transactions are not within the intended scope of this definition for
purposes of this agreement; (C) a person, within the meaning of Section
3(a)(9) or Section 13(d)(3) hereof (as in effect on the date hereof) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
shall become the beneficial owner (as defined in Rule 13d-3 of the
Exchange Act) of thirty percent (30%) or more of the outstanding voting
securities of the Company; or (D) any shareholder of the Company shall
nominate a person to the Board of Directors of the Company (the
"Board"), which nominee shall be elected to the Board without receiving
the prior endorsement of the Board or its Nominating Committee.
4. Forfeiture of the Shares. In the event of a forfeiture, the
certificates representing all of the Shares covered by this agreement that have
not become nonforfeitable in accordance with Section 3 hereof shall be cancelled
and such Shares shall be deemed to be and to have become authorized but unissued
shares of common stock, without par value, of the Company.
5. Dividend, Voting and Other Rights. So long as the Trustee continues
to hold the Shares in accordance with the Trust, all dividend, voting and other
rights will be exercised and enjoyed by the Trustee in accordance with the terms
of the Trust for the benefit of Employee, subject, however, to the terms of
Section 4 and this Section 5. In the event that for any reason prior to vesting
of any of the Shares in accordance with Section 3 above, the Deferred
Compensation Plan and the Trust shall no longer remain effect or the Trustee
shall have otherwise ceased to hold the Shares for Employee's benefit, the
Employee shall, at all times prior to forfeiture, have all of the rights of a
shareholder with respect to the Shares covered by this agreement, including the
right to vote the Shares and receive any dividends that may be paid thereon;
provided, however, that (a) any cash dividends and other cash Distributions that
may be paid on any Shares covered by this agreement that have not become
nonforfeitable in accordance with Section 3 hereof shall be automatically
sequestered and invested in an interest-bearing bank account, which shall be
subject to the same restrictions hereunder as the forfeitable Shares on which
the cash dividends or other cash distributions are paid, and (b) any additional
Shares that the Employee may become entitled to receive pursuant to a share
dividend or a merger or reorganization in which the Company is the surviving
corporation or any other change in the capital structure of the Company shall be
subject to the same restrictions as the Shares covered by this agreement.
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6. Retention of Share Certificate(s) by Company. The certificate(s)
representing the Shares covered by this agreement shall be held in custody by
the Company, together with a stock power endorsed in blank by the Trustee with
respect thereto, until those shares have become nonforfeitable in accordance
with Section 3 hereof.
7. Adjustments. The Committee shall make any adjustments in the number
or kind of shares of stock or other securities covered by this agreement that
the Committee, in its discretion, may determine to be equitably required to
prevent any dilution or expansion of the Employee's beneficial rights under this
agreement that otherwise would result from any (a) stock dividend, stock split,
combination of shares, recapitalization or other change in the capital structure
of the Company, (b) merger, consolidation, separation, reorganization or partial
or complete liquidation involving the Company or (c) other transaction or event
having an effect similar to any of those referred to in Section 7(a) or 7(b)
hereof. Furthermore, in the event that any transaction or event described or
referred to in the immediately preceding sentence shall occur, the Committee may
provide in substitution of any or all of the Employee's beneficial rights under
this agreement such alternative consideration as the Committee, in its
discretion, may determine to be equitable under the circumstances.
8. Withholding Taxes. If the Company shall be required to withhold any
federal, state, local or foreign tax in connection with any issuance of
restricted or unrestricted Shares or other securities pursuant to this
agreement, the Employee shall pay the tax or make provisions that are
satisfactory to the Company for the payment thereof.
9. Right to Terminate Employment. No provision of this agreement shall
limit in any way whatsoever any right that the Company or a subsidiary may
otherwise have to terminate the employment of the Employee at any time.
10. Relation to Other Benefits. Any economic or other benefit to the
Employee under this agreement or the Deferred Compensation Plan shall not be
taken into account in determining any benefits to which the Employee may be
entitled under any profit-sharing, retirement or other benefit or compensation
plan maintained by the Company or a subsidiary and shall not affect the amount
of any life insurance coverage available to any beneficiary under any life
insurance plan covering employees of the Company or a subsidiary.
11. Severability. In the event that one or more of the provisions of
this agreement shall be invalidated for any reason by a court of competent
jurisdiction, any provision so invalidated shall be deemed to be separable from
the other provisions hereof and the remaining provisions hereof shall continue
to be valid and fully enforceable.
12. Governing Law. This agreement is made under, and shall be construed
in accordance with, the laws of the State of Ohio.
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This agreement is executed by the Company as of the 18th day of April, 1996 so
as to be effective as of the 15th day of April, 1996.
CARDINAL REALTY SERVICES, INC.
By: /s/ Joseph E. Madigan
------------------------------
Joseph E. Madigan
Chairman of the Board
The undersigned, Employee hereby acknowledges receipt of an executed
original of this agreement and accepts the beneficial, deferred right to receive
the Shares or other securities covered hereby, subject to the terms and
conditions of the Deferred Compensation Plan and the terms and conditions
hereinabove set forth.
Employee acknowledges that he has been advised that the Shares covered
by this agreement have not been registered under the Securities Act of 1933 and
agrees that he will not make any disposition of such shares unless either (a)
such Shares have been registered under said Act or (b) an exemption from the
registration provisions of said Act is applicable to the Trustee's or Employee's
proposed disposition of such Shares, as the case may be. Employee understands
that the certificates for such Shares may bear a legend substantially as
follows:
The shares evidenced by this Certificate have not been registered under
the Securities Act of 1933. Such shares may not be sold or otherwise
transferred until the same have been registered under said Act or until
the Company shall have received an opinion of legal counsel or a copy
of a letter from the staff of the Division of Corporation Finance of
the Securities and Exchange Commission, in either case satisfactory to
the Company, that such shares may legally be sold or otherwise
transferred without such registration.
/s/ John Bram Bartling, Jr.
----------------------------------
JOHN BRAM BARTLING, JR.
Date: April 18, 1996
Effective as of April 15, 1996