SUNSOURCE INC.
1998 EQUITY COMPENSATION PLAN
RESTRICTED STOCK GRANT
This RESTRICTED STOCK GRANT, dated as of January 26, 2000, is delivered by
SunSource Inc. (the "Company"), to Maurice P. Andrien (the "Grantee").
RECITALS
A. The SunSource Inc. Equity Compensation Plan (the "Plan") provides
for the grant of restricted stock in accordance with the terms and conditions of
the Plan.
B. On January 26, 2000 the committee established under the terms of the
Plan (the "Committee") approved a restructuring of Grantee's equity compensation
grants whereby the number of shares covered by a previous option grant shall be
reduced to 50,000 and the Grantee shall receive a new grant of 100,000
restricted shares under the Plan.
C. The Plan is administered and interpreted by the Committee.
NOW, THEREFORE, the parties to this agreement, intending to be legally
bound hereby, agree as follows:
1. Restricted Stock Grant. The Company hereby grants the Grantee
100,000 shares of common stock of the Company effective January 26, 2000 (the
"Date of Grant"), subject to the restrictions set forth below and in the Plan
("Restricted Stock"). Shares of Restricted Stock may not be transferred by the
Grantee or subjected to any security interest until the shares have become
vested pursuant to this Agreement and the Plan. This grant is contingent upon
the Grantee executing the Amendment to Nonqualified Stock Option Grant of even
date.
2. Vesting of Restricted Stock.
(a) The restrictions described in Section 2(b) and Section 3 shall
lapse with respect to the Restricted Stock as follows, provided, that the
Grantee has a Company Relationship from the Date of Grant until the respective
date set forth below:
(i) 33,333 shares of Restricted Stock shall become vested on July
26, 2000 (six months from the date of grant);
(ii) 33,333 shares of Restricted Stock shall become vested on the
earlier of either: (A) the last day of the continuous thirty calendar day period
during which the closing price for the Company's stock is at least $9.00 per
share, or (B) January 26, 2003 (three years from the date of grant); and
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(iii) 33,334 shares of Restricted Stock shall become vested on the
earlier of either (A) the last day of the continuous thirty calendar day period
during which the closing price for the Company's stock is at least $15.00 per
share, or (B) January 26, 2003 (three years from the date of grant).
The vesting of the Restricted Stock shall be cumulative.
(b) If the Grantee voluntarily terminates employment or is
involuntarily terminated for "Cause," as defined in the Plan, before the
Restricted Stock is fully vested, the shares of Restricted Stock that are not
then vested shall be forfeited and must be immediately returned to the Company.
The Committee shall accelerate vesting of the Restricted Shares if the Grantee
terminates employment on account of death, disability (as defined under the
Company's long-term disability plan then in effect), approved retirement, or
involuntary termination without Cause.
(c) For purposes of this Agreement, "Company Relationship" means
employment as an employee of, or the provision of services to, the Company or a
subsidiary.
3. Nonassignability of Rights. During the period before the shares of
Restricted Stock vest (the "Restriction Period"), the non-vested Restricted
Stock may not be assigned, transferred, pledged or otherwise disposed of by the
Grantee. Any attempt to assign, transfer, pledge or otherwise dispose of the
shares contrary to the provisions hereof, and the levy of any execution,
attachment or similar process upon the shares, shall be null and void and
without effect.
4. Issuance of Certificates.
(a) Stock certificates representing the Restricted Stock may be issued
by the Company and held in escrow by the Company until the Restricted Stock
vests, or the Company may hold non-certificated shares until the Restricted
Stock vests. During the Restriction Period, the Grantee shall receive any cash
dividends with respect to the shares of Restricted Stock, may vote the shares of
Restricted Stock and may participate in any distribution pursuant to a plan of
dissolution or complete liquidation of the Company. In the event of a dividend
or distribution payable in stock or other property or a reclassification, split
up or similar event during the Restriction Period, the shares or other property
issued or declared with respect to the non-vested shares of Restricted Stock
shall be subject to the same terms and conditions relating to vesting as the
shares to which they relate.
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(b) When the Grantee obtains a vested right to shares of Restricted
Stock, a certificate representing the vested shares shall be issued to the
Grantee, free of the restrictions under Sections 2 and 3 of this Agreement.
5. Change of Control. In the event of a Change of Control, all
restrictions relating to the Restricted Stock shall lapse unless the Committee
determines that lapse of the restrictions may result in the loss of pooling of
interests accounting treatment or may result in triggering "excess parachute
payments" pursuant to Section 13(e) of the Plan.
6. Grant Subject to Plan Provisions. This grant is made pursuant to the
Plan, the terms of which are incorporated herein by reference, and in all
respects shall be interpreted in accordance with the Plan. The grant is subject
to the provisions of the Plan and to interpretations, regulations and
determinations concerning the Plan established from time to time by the
Committee in accordance with the provisions of the Plan, including, but not
limited to, provisions pertaining to (i) rights and obligations with respect to
withholding taxes, (ii) the registration, qualification or listing of the
Shares, (iii) capital or other changes of the Company and (iv) other
requirements of applicable law. The Committee shall have the authority to
interpret and construe the grant pursuant to the terms of the Plan, and its
decisions shall be conclusive as to any questions arising hereunder.
Notwithstanding the foregoing, to the extent the Committee has discretion under
the Plan, such discretion shall not be exercised in a manner that is
inconsistent with the terms of an employment agreement between the Company and
the Grantee ("Employment Agreement").
7. Withholding. The Grantee shall be required to pay to the Company, or
make other arrangements satisfactory to the Company to provide for the payment
of, any income and other payroll withholding taxes that the Company is required
to withhold with respect to the grant or vesting of the Restricted Stock.
8. No Employment or Other Rights. This grant shall not confer upon the
Grantee any right to be retained by or in the employ or service of the Company
and shall not interfere in any way with the right of the Company to terminate
the Grantee?s employment or service pursuant to the Employment Agreement.
9. Assignment by Company. The rights and protections of the Company
hereunder shall extend to any successors or assigns of the Company and to the
Company's parents, subsidiaries, and affiliates. This Agreement may be assigned
by the Company without the Grantee?s consent.
10. Applicable Law. The validity, construction, interpretation and
effect of this instrument shall be governed by and determined in accordance with
the laws of the State of Delaware, without giving effect to the conflicts of
laws provisions thereof.
11. Notice. Any notice to the Company provided for in this instrument
shall be addressed to the Company in care of the Vice President - Finance at
SunSource Inc., 3000 One Logan Square, Philadelphia, PA 19103, and any notice to
the Grantee shall be addressed to such Grantee at the current address shown on
the payroll of the Company, or to such other address as the Grantee may
designate to the Company in writing. Any notice shall be delivered by hand, sent
by telecopy or enclosed in a properly sealed envelope addressed as stated above,
registered and deposited, postage prepaid, in a post office regularly maintained
by the United States Postal Service.
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IN WITNESS WHEREOF, the Company has caused its duly authorized officer
to execute this Grant Instrument as evidence of the Restricted Stock Grant
referenced herein, and the Grantee has executed this grant instrument to
evidence acceptance of such Restricted Stock grant on the terms and conditions
specified herein, all effective as of the Date of Grant.
SUNSOURCE INC.
By:____________________________
Accepted:______________________
Grantee
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