Exhibit 10.27
JACK HENRY & ASSOCIATES, INC.
RESTRICTED STOCK PLAN
Adopted by the Stockholders and Amended by the Board of Directors November
1, 2005
1. Purpose of the Plan. The Jack Henry & Associates, Inc. Restricted
Stock Plan ("Plan") is intended to provide Jack Henry & Associates, Inc.
(the "Corporation") with a means to assist in the recruiting, retaining and
rewarding of employees and members of the Board of Directors and to motivate
such individuals to exert their best efforts on behalf of the Corporation by
providing incentives through the granting of shares of stock.
2. Definitions. The following terms shall have the following meanings:
a. "Act" means the Securities Exchange Act of 1934, as amended, or
any successor thereto.
b. "Award" means any grant of restricted stock under the Plan.
c. "Award Agreement" means an agreement entered into between the
Corporation and a Participant, as such agreement may be amended
from time to time, setting forth the terms and provisions
applicable to any Award.
d. "Board" means the Board of Directors of the Corporation.
e. "Change in Control" means (i) the purchase or other acquisition by
any person, entity or group of persons, within the meaning of Section 13(d)
or 14(d) of the Act (excluding, for this purpose, the Corporation or
its subsidiaries or any employee benefit plan or related trust of the
Corporation or its subsidiaries), of beneficial ownership, within the
meaning of Rule 13d-3 promulgated under the Act, of 20% or more of the
combined voting power of the Corporation's then-outstanding voting
securities entitled to vote generally in the election of directors in any
transaction or series of transactions; (ii) when individuals who, as of the
date hereof, constituting the Board ("Incumbent Board") cease for any reason
to constitute at least a majority of the Board, provided that any person who
becomes a director subsequent to the date hereof whose election, or
nomination for election by the Corporation's shareholders, was approved in
advance by a vote of at least a majority of the directors then comprising
the Incumbent Board excluding members of its Incumbent Board who are no
longer serving as directors (other than an individual whose initial
assumption of office is in connection with an actual or threatened election
contest relating to the election of directors of the Corporation, as such
terms are used in Rule 14a-11 of Regulation 14A promulgated under the Act,
or an individual approved by the Incumbent Board as result of an agreement
intended to avoid or settle an actual or threatened contest) shall be, for
purposes of this section, considered as though such person were a member of
the Incumbent Board; (iii) consummation of a reorganization, merger or
consolidation, in each case following such reorganization, merger or
consolidation: (a) persons who were the shareholders of the Corporation
immediately prior to such reorganization, merger or consolidation
immediately thereafter own 50% or less of the combined voting power entitled
to vote generally in the election of directors of the reorganized, merged or
consolidated corporation's then-outstanding voting securities, or (b) less
than a majority of members of the board or other governing body of
such reorganized, merged or consolidated corporation were members of the
Incumbent Board at the time of the execution of the initial agreement or the
approval of the transaction by the Board; or (iv) approval by shareholders
of a liquidation or dissolution of the Corporation (and the Corporation
shall commence such liquidation or dissolution), or consummation of the sale
of all or substantially all of the assets of the Corporation (in one
transaction or a series of transactions).
f. "Code" means the Internal Revenue Code of 1986, as amended, or any
successor thereto.
g. "Common Stock" means common stock of the Corporation, par value
$0.01.
h. "Director" means an individual actively serving as a member of the
Board.
i. "Family Member" means any child, stepchild, grandchild, parent,
stepparent, spouse, former spouse, sibling, niece, nephew, mother-in-law,
father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law,
including adoptive relationships, any person sharing the Participant's
household (other than a tenant or employee), a trust in which the foregoing
persons have more than 50% of the beneficial interests, a foundation in
which the Participant or the foregoing persons control the management of
assets and any other entity in which the Participant or the foregoing
persons own more than 50% of the voting interests.
j. "Incapacitated" means a mental or physical illness that entitles
the Participant to receive benefits under a long-term disability plan of the
Corporation, or if there is no such plan or the Participant is not covered
by such a plan or the Participant is not an employee of the Corporation, a
mental or physical illness that renders the Participant totally and
permanently incapable of performing the Participant's duties for the
Corporation. Notwithstanding the foregoing, Incapacity shall not qualify
under this Plan if it is the result of (i) a willfully self-inflected injury
or willfully self-induced sickness; or (ii) an injury or disease contracted,
suffered, or incurred while participating in a criminal offense. The
determination of Incapacity for purposes of this Plan shall be made by a
physician satisfactory to the Board and shall not be construed to be an
admission of incapacity for any other purpose.
k. "Participant" means an employee or a Director of the Corporation
or its subsidiaries, who is selected by the Board to receive an Award.
l. "Permitted Transferee" means any Family Member of a Participant or
a trust maintained exclusively for the benefit of , or a partnership all of
the interests in which are held by, one or more of the Participant and his
or her Family Members.
3. Stock Subject to the Plan. Subject to the adjustments described in
Section 8, 3,000,000 shares of Common Stock (the "Restricted Stock") are
authorized for Awards under the Plan. Such shares may come from authorized
but unissued shares of Common Stock and/or from previously issued shares of
Common Stock that have been reacquired by the Corporation. In the event any
Award shall expire or terminate for any reason, the shares subject to the
Award shall again be available for the purposes of the Plan. Subject to the
adjustments described in Section 8, the number of shares of Common Stock
that may be granted to all Participants in the aggregate as Awards under the
Plan in any fiscal year of the Corporation shall not exceed 500,000 shares.
4. Administration of the Plan. The Plan shall be administered by the
Board, which may from time to time delegate all or any part of its authority
under this Plan to a committee of the Board (or subcommittee thereof)
appointed by the Board. A majority of the committee (or subcommittee) shall
constitute a quorum, and the action of the members of the committee (or
subcommittee) present at any meeting at which a quorum is present, or acts
unanimously approved in writing, shall be the acts of the committee (or
subcommittee). To the extent of any such delegation, references in this
Plan to the Board shall be deemed to be references to any such committee (or
subcommittee). The interpretation and construction by the Board of any
provision of the Plan or of any agreement, notification or document
evidencing the grant of an Award and any determination by the Board pursuant
to any provision of this Plan or any such agreement, notification or
document shall be conclusive. No member of the Board shall be liable for
any such action or determination made in good faith.
5. Eligibility. Awards may be granted to any employee or Director of the
Corporation or its subsidiaries pursuant to the sole discretion of the Board
in accordance with Section 4.
6. Awards; Vesting.
a. Awards. Awards may be granted to Participants in such amounts and
upon such terms, and at any time and from time to time, as shall be
determined by the Board and set forth in an Award Agreement duly executed on
behalf of the Corporation and accepted by the Participant.
b. Performance-Based Awards. The Board may, in its sole and absolute
discretion, determine that certain Awards should be subject to such
requirements so that they are deductible by the Corporation under Code
Section 162(m). If the Board so determines, such Awards shall be considered
performance-based awards subject to the terms of this Section 6.b., as
provided in the Award Agreement. A performance-based Award shall be granted
by the Board in a manner to satisfy the requirements of Code Section 162(m)
and the regulations thereunder. The performance measures to be used for
purposes of a performance-based Award shall be determined by a committee or
subcommittee of the Board, consisting solely of outside directors (as
defined in Treasury Regulations Section 1.162-27(e) (3), in its sole and
absolute discretion, no later than 90 days after the commencement of the
period of service to which such performance criteria relates or, if earlier,
the date on which 25% of such period of service elapses. Performance
objectives need not be the same with respect to all performance-based Awards
granted under the Plan. Each of the performance criteria is to be
specifically defined in advance by the committee or subcommittee and may
include or exclude specified items of an unusual or non-recurring nature.
The criteria upon which the committee or subcommittee shall establish
performance objectives shall include but not be limited to: earnings per
share of stock; book value per share of stock; net income (before or after
taxes); operating income; return on invested capital, assets or equity; cash
flow return on investments which equals net cash flows divided by owners'
equity; earnings before interest or taxes; gross revenues or revenue growth;
market share; expense management; improvements in capital structure; profit
margins; stock price; total stockholder return; free cash flow; or working
capital. Performance-based Awards shall be forfeited if the applicable
performance objective(s) are not achieved or if the Plan is not approved by
the shareholders of the Corporation as described in Section 14. Such
committee or subcommittee shall determine whether, with respect to a
performance period, the applicable performance goals have been met with
respect to an Award and, if they have, to so certify in writing and
ascertain the amount of the applicable performance-based Award. The
committee or subcommittee shall have the discretion to adjust performance-
based awards downward. Unless the shareholders of the Corporation shall
have first approved thereof, no amendment of the Plan shall be effective
which would increase the maximum amount which can be paid under a
performance-based Award, which would change the specified performance
objectives for payment of performance-based Awards, or which would modify
the requirements as to eligibility for participation in performance-based
Awards under the Plan. In no event shall the total amount of a performance-
based Award paid to any Participant in any fiscal year of the Corporation
exceed 50,000 shares of Common Stock.
c. Vesting. Any shares of Restricted Stock awarded shall be
nontransferable by the Participant during the period described in the Award
Agreement and shall be subject to the risk of forfeiture described in the
Award Agreement. Prior to the time shares become transferable, the shares
of Restricted Stock shall bear a legend indicating their nontransferability,
and, unless otherwise provided in the Award Agreement, if the Participant
ceases to be a Director or terminates employment with Corporation prior to
the time a restriction lapses, and/or if the performance criteria specified
in the Award Agreement are not achieved, if applicable, the Participant
shall forfeit any shares of Restricted Stock which are still subject to the
restrictions at the time of termination of such employment or service, or
expiration of the performance period. When an Award is granted, the
Participant shall become vested in such shares in accordance with the terms
of the Award Agreement, which except as otherwise provided in Section 6.b.
with respect to performance-based Awards, shall generally provide for a
graded vesting schedule. However, the Board may at any time accelerate the
vesting schedule, in its sole discretion. Additionally, in the event of a
Change in Control or death or Incapacity of the Participant, unless
otherwise provided in the Award Agreement, all previously granted shares of
Restricted Stock not yet free of the restrictions of described herein shall
become immediately free of such restrictions.
d. Timing of Awards. An Award shall be deemed to be made on the date
on which the Board, by formal action of its members duly recorded in the
records thereof, makes an award of shares of Restricted Stock to a
Participant, provided that such award is evidenced by an Award Agreement in
the manner set forth in 6.a above within a reasonable time after the date of
the Board action. Notwithstanding the foregoing, the Board may, in the
records of its formal action, designate a future date on which an Award
shall be made.
e. Restricted Stock. Restricted Stock may be granted in the form of
shares registered in the name of the Participant but held by the Corporation
or an escrow agent designated by the Corporation until the restrictions on
the Award lapse, subject to forfeiture, as provided in the applicable Award
Agreement. The Board, in the applicable Award Agreement, may, in its sole
discretion, award all or any rights of a shareholder with respect to the
shares of Restricted Stock during the period that they remain subject to
restrictions, including without limitation, the right to vote the shares and
receive dividends.
f. Requirements for Issuance. No shares of Restricted Stock will be
issued or transferred pursuant to an Award unless and until all then
applicable requirements imposed by federal and state securities and other
laws, rules and regulations and by any regulatory agency having jurisdiction
over the Corporation, the Common Stock or the Awards, or by any stock
exchange or securities quotation system upon which the Common Stock may be
listed, have been fully met. As a condition precedent to the issuance of
shares of Restricted Stock pursuant to the grant of an Award, the
Corporation may require the Participant to take any reasonable action to
meet such requirements.
7. Nontransferability of Award. Except as otherwise provided in this
Section 7, Awards may not be transferred by a Participant other than by
will or the laws of descent and distribution. Any attempted transfer,
assignment, pledge, hypothecation or other disposition except as herein
provided, including, without limitation, any disposition, attachment,
divorce, trustee process or similar process, whether legal or equitable
shall be null and void and without effect. Notwithstanding anything herein
to the contrary, to the extent provided in the Award Agreement, an Award may
be transferred by the Participant, without consideration and subject to the
provisions of this Plan (including, but not limited to, the vesting and
forfeiture provisions of Section 6.c.), to a Permitted Transferee of such
Participant.
8. Adjustments. Notwithstanding any other provisions of the Plan, in the
event of changes in the capitalization of the Corporation by reason of a
recapitalization, merger, consolidation, split-up, stock split, combination
or exchange of shares of stock and the like (each, an "Adjustment Event"),
the aggregate number of shares of common stock available under the Plan will
be appropriately adjusted by the Board such that the Adjustment Event does
not adversely effect the rights of the Participants under the Plan, whose
determination shall be conclusive.
9. Amendment and Termination; Term. The Board may at any time terminate
the Plan or make such modifications to the Plan as the Board shall deem
advisable; provided, however, that the Board may not, without further
approval by the shareholders of the Corporation, increase the maximum number
of shares as to which Awards may be granted under the Plan (except under the
anti-dilution provisions of Section 8), increase the maximum amount which
can be paid under a performance-based Award, change the specified
performance objectives for payment of performance-based Awards, modify the
requirements as to eligibility for participation in performance-based
Awards, or make any other amendments or modifications which require
shareholder approval under applicable law, regulation or stock exchange
rule. Unless otherwise terminated earlier by the Board, the Plan shall
terminate on the date which is 10 years after the date the Plan is adopted
by the Board or, if earlier, approved by the shareholders of the
Corporation. No termination or amendment to the Plan may, without the
consent of the affected Participant, have a material adverse effect on the
rights of such Participant under such Award.
10. No Continued Right to Employment. Nothing in the Plan or in any
Award granted pursuant to the Plan shall be considered or construed as
creating a contract of employment for any specified period of time or shall
confer on any individual any right to continue in the employment or service
of the Corporation or interfere in any way with the right of the Corporation
to terminate his or her employment at any time.
11. Withholding. The Corporation at the time any payment is made under
the Plan is authorized to withhold from such payment any amount necessary to
satisfy income tax withholding requirements in respect of such payment; and
for this purpose, may withhold the necessary number of shares to satisfy
such requirement. Alternatively, if the participant shall pay to the
Corporation such cash amount as may be necessary to satisfy such withholding
requirements, he or she shall be entitled to receive delivery of all shares
due hereunder.
12. Non-Waiver of Rights. The Corporation's failure to enforce at any
time any of the provisions of this Plan or any Award Agreement or to require
at any time performance by the Participant of any of the provisions hereof
shall in no way be construed to be a waiver of such provisions or to affect
either the validity of this Plan, any Award Agreement, or any part hereof,
or the right of the Corporation thereafter to enforce each and every
provision in accordance with the terms of the Plan and any Award Agreement.
13. Severability. Any word, phrase, clause, sentence or other provision
herein which violates or is prohibited by any applicable law, court decree
or public policy shall be modified as necessary to avoid the violation or
prohibition and so as to make this Plan and any Award Agreement enforceable
as fully as possible under applicable law, and if such cannot be so
modified, the same shall be ineffective to the extent of such violation or
prohibition without invalidating or affecting the remaining provisions
herein.
14. Effectiveness of the Plan. The Plan shall become effective after
both its adoption by the Board and the further approval of the Plan by the
shareholders of the Corporation given within 12 months of the date the Plan
is adopted by the Board at a regular meeting of the shareholders or at a
special meeting duly called and held for such purposes.
15. Choice of Law. The Plan shall be governed by and construed according
to the laws of the State of Delaware, without regard to the principles of
conflicts of law which might otherwise apply.
16. Successors. All obligations of the Corporation under this Plan shall
be binding on any successor to the Corporation whether the existence of such
successor is the result of a direct or indirect purchase, merger,
consolidation, or otherwise, of all or substantially all of the business
and/or assets of the Corporation.