EXHIBIT 10.4
HILLENBRAND INDUSTRIES, INC.
STOCK AWARD
(EFFECTIVE _______, 200__)
1. Purpose. The purpose of the Hillenbrand
Industries, Inc. Stock Award (hereinafter called the "Award") is to promote
profitability and growth of Hillenbrand Industries, Inc. (the "Company") by
offering an incentive payable in Company common stock to _____________
("Employee") who contributes to such profitability and growth.
2. Amount of Award. The Company shall cause an
account to be established in the name of the Employee ("Deferred Stock Account")
which shall be assumed to be invested in _______ (________) shares ("Initial
Deferred Stock Award") of common stock, no par value of the Company ("Common
Stock"). No actual shares of Common Stock shall be held in the Deferred Stock
Account, and the number of shares of Common Stock maintained in the Deferred
Stock Account ("Deferred Stock") shall be a book entry which states the number
of shares of Common Stock the Employee would have a right to receive in
accordance with the terms of this Award. Any cash dividend paid on Common Stock
by the Company while the Deferred Stock Account exists will be assumed to be
paid on the Deferred Stock in the Deferred Stock Account and shall be assumed to
be reinvested in Common Stock on the date of such dividend payment, thereby
increasing the number of shares of Deferred Stock maintained in the Deferred
Stock Account. Any stock dividends, stock splits and other similar rights
inuring to Common Stock shall also be assumed to inure to the Deferred Stock,
which may increase or decrease the number of shares of Deferred Stock in the
Deferred Stock Account. The Initial Deferred Stock Stock Award plus any
increases or less any decreases due to cash dividends, stock dividends, stock
splits and any other similar rights inuring to Common Stock as set forth in the
two immediately preceding sentences shall herein after be referred to as the
"Deferred Stock Award."
If Employee's employment with the Company or any of its Subsidiaries (as defined
in the Plan) continues uninterrupted from the effective date of this Award
through the day after the second, third, fourth and fifth anniversaries of such
effective date, respectively, an amount of Deferred Stock which equals a
percentage as set forth below of the Deferred Stock Award, shall be
non-forfeitable ("Vested Deferred Stock"), and the Company shall, subject to his
election to defer receipt, deliver to him shares of Common Stock equal in number
to the number of shares of Deferred Stock which became Vested Deferred Stock on
the day after such second, third, fourth and fifth anniversary dates as follows:
The day after the second anniversary date of the 20% of the Deferred Stock Award
effective date of this Award
The day after the third anniversary date of the 25% of the Deferred Stock Award
effective date of this Award
The day after the fourth anniversary date of the 25% of the Deferred Stock Award
effective date of this Award
The day after the fifth anniversary date of 30% of the Deferred Stock
the effective date of this Award Award
Any Deferred Stock maintained in the Deferred Stock Account which is not Vested
Deferred Stock shall, upon the Employee's termination of employment shall be
forfeited by Employee without the payment of any consideration or further
consideration by the Company, and neither Employee nor any successors, heirs,
assigns, or legal representatives of Employee shall thereafter have any further
rights or interest in such forfeited Deferred Stock. Any fractional shares of
Vested Deferred Stock shall be rounded up to the next whole share of Vested
Deferred Stock.
Notwithstanding the schedule set forth above, Deferred Stock maintained in the
Deferred Stock Account shall become Vested Deferred Stock upon (A) the
occurrence of any one of the following events after the day after the first
anniversary date of the effective date of this Award: (i) termination of
Employee's employment with the Company, one of its Subsidiaries (as defined in
the Plan) or one of their respective divisions by reason of retirement after
attaining age fifty-five (55) and completion of five (5) years of employment, or
(ii) termination of Employee's employment with the Company, one of its
Subsidiaries or one of their respective divisions by reason of disability, as
determined by the Compensation and Management Development Committee of the
Company's Board of Directors (the "Committee"), or death, or (B) the occurrence
of (i) a Change in Control (as defined in Section 14.2 of the Plan), or (ii) a
sale, transfer or disposition of substantially all of the assets or capital
stock of a Subsidiary (as defined in the Plan) or division of the Company or one
of its Subsidiaries for whom the Employee is employed at the time of such sale.
Temporary absences from employment because of illness, vacation or leave of
absence and transfers among the Company and/or any of its Subsidiaries shall not
be considered terminations of employment. For purposes of this Agreement and the
Plan, the Committee shall have absolute discretion to determine the date and
circumstances of termination of Employee's employment, and its determination
shall be final, conclusive and binding upon Employee.
The shares of Common Stock delivered to the Employee shall be from shares held
by the Company as treasury stock or from shares of Common Stock acquired by the
Company in the open market. Subject to the Employee's election to defer, all
shares of Common Stock to be delivered to the Employee shall be delivered as
soon as administratively possible after the day after the corresponding
anniversary date or as soon as administratively possible after the Employee's
termination of employment or after the occurrence of the events described in
clauses (B) (i) and (ii) in the immediate foregoing paragraph of this Section.
3. Administration of the Award. The Committee shall
administer the Award. The Committee shall have complete and full discretion in
the administration and interpretation of the terms of the Award.
4. Right to Defer Payment of Award.
(a) Election to Defer Award. The Employee may elect
to defer payment of the Award otherwise due on the anniversary date set forth in
Section 2 by completing a written election and delivering such election to the
Company at least sixty (60) days prior to
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the applicable anniversary date; provided however, that the completion of such
written election and the delivery of such election may be at an earlier date as
determined by the Committee or required by law to insure the validity of such
deferral. At the end of the deferral period elected by the Employee (or within a
certain period of time after the last day of the deferral period as determined
by the Committee or required by law to insure the validity of the deferral) or,
if earlier, within sixty (60) calendar days of the date on which the Employee's
employment is terminated, the Company, consistent with Section 2 and subject to
Section 6, 7 and 8 shall deliver to the Employee shares of Common Stock equal in
number to the number of Vested Deferred Stock held in the Employee's Deferred
Stock Account.
(b) Financial Hardship. A withdrawal from the
Employee's Deferred Stock Account of Vested Deferred Stock shall be permitted
prior to the termination of the deferral period in the event that the Employee
experience serious financial hardship which is beyond the Employee's control and
which would cause the Employee a severe hardship if such withdrawal were not
permitted. Serious financial hardship may be incurring a disability or
unexpected and unreimbursed major expenses resulting from illness or accident or
impending bankruptcy. The Employee must apply to the Committee for a serious
financial hardship withdrawal and demonstrate that the circumstances being
experienced were not under the Employee's control and constitute a real
emergency which is likely to cause great financial hardship. The Committee shall
have the authority to require such medical or other evidence as it may need to
determine the necessity for the Employee's withdrawal request. If such
application for withdrawal is permitted, the amount of such withdrawal shall be
limited to an amount of the Employee's Vested Deferred Stock which would have
been payable if the Employee's employment with the Company was terminated. If
the Employee makes a withdrawal, the amount of the Employee's Deferred Stock
Account under this Award shall be proportionately reduced to reflect the
withdrawal. Also, the withholding requirements described in Section 7 shall also
be effected before the withdrawal.
5. No Rights as Stockholder. Employee shall have no
rights as a stockholder with respect to any shares of Common Stock covered by
this Award until shares of Common Stock are delivered to the Employee pursuant
to the last paragraph in Section 2 and Section 4. Until such time, Employee
shall not be entitled to dividends (except where the Employee's Deferred Stock
Account is adjusted pursuant to the first paragraph of Section 2) or to vote at
meetings of the stockholders of the Company.
6. Compliance With Securities Laws. Prior to the
receipt of any certificates for shares of Common Stock pursuant to this Award,
Employee (or Employee's beneficiary or legal representative upon Employee's
death or disability) shall enter into such additional written representations,
warranties and Awards as the Company may reasonably request in order to comply
with applicable securities laws or with this Award.
7. Stock Ownership Guidelines. Employee (or
Employee's beneficiary or legal representative upon the Employee's death or
disability) shall be bound by the "Stock Ownership Guidelines" of the Company as
may be in effect from time to time.
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8. Withholding. Any payment of Common Stock under
this Award shall be subject to applicable federal and state withholding
requirements. Hence, unless the Employee delivers a check to the Company equal
to the required withholding, the number of shares distributed shall be reduced
to meet the Employee's applicable withholding requirements.
9. Designation of Beneficiary. The Employee shall be
permitted to provide to the Committee a beneficiary designation for receipt of
his or her Award after death. If the Employee fails to designate a beneficiary,
or if the designated beneficiary predeceases the Employee, the Award shall be
paid to the deceased Employee's spouse, if living, or if such spouse is not
living, to the deceased Employee's estate.
10. Adjustments. If there is a change in the
outstanding shares of the Common Stock by reason of any stock dividend or split,
recapitalization, merger, consolidation, spin-off, reorganization, combination
or exchange of shares or other similar corporate change occurring after the
effective date of this Award, the Committee shall adjust the number of shares of
Common Stock subject to the Award to reflect the change, and such adjustment
shall be conclusive and binding upon the Employee and the Company.
11. Non-Transferability.
(a) The Deferred Stock, the Deferred Stock
Account and the Vested Deferred Stock may not be sold, assigned, transferred,
exchanged, pledged, hypothecated, or otherwise encumbered and no such sale,
assignment, transfer, exchange, pledge, hypothecation, or encumbrance, whether
made or created by a voluntary act of the Employee or any agent of the Employee
or by operation of law, shall be recognized by, or be binding upon, or shall in
any manner affect the rights of, the Company, its successors or any agent
thereof.
(b) No amounts payable under the Award shall
be transferable by the Employee other than by his designation of a beneficiary
pursuant to Section 9. The amounts payable under the Award shall be exempt from
the claims of creditors of the Employee and from all orders, decrees, levies and
executions and any other legal process to the fullest extent that may be
permitted by law.
12. Amendments to Award. The Award may only be
modified upon the mutual agreement of the Company and the Employee.
13. Source of Benefit Payments. The payment of the
Award to the Employee shall be paid solely from the general assets of the
Company. Until the actual delivery of the shares of Common Stock, the Employee
shall not have any interest in any specific assets of the Company, including
shares of Common Stock, under the terms of the Award. The Award shall not be
considered to create an escrow account, trust fund or other funding arrangement
of any kind, or a fiduciary relationship between the Employee and the Company.
Until such time of payment, no shares of the Common Stock shall be set aside by
the Company for the Award.
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14. Successors and Assigns.
(a) This Award is personal to the Employee
and without the prior written consent of the Company shall not be assignable by
the Employee except by will or the laws of descent and distribution. This Award
shall inure to the benefit of and be enforceable by the Employee's guardian and
legal representatives.
(b) This Award shall inure to the benefit of
and be binding upon the Company and its successors and assigns.
(c) The Company shall require any successor
(whether direct or indirect, by purchase, merger, consolidation or otherwise) to
all or substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Award in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place.
15. Award Subject to Plan. This Award is subject to
the terms of the Hillenbrand Industries, Inc. Stock Incentive Plan ("Plan"). The
terms and provisions of the Plan (including any subsequent amendments thereto)
are hereby incorporated herein by reference. In the event of a conflict between
any terms and provisions contained herein and the terms or provisions of the
Plan, the applicable terms or provisions of the Plan will govern and prevail.
16. Governing Law. This Award shall be governed by
and construed in accordance with the internal laws of the State of Indiana
without reference to principles of conflict of laws. The captions of this Award
are not part of the provisions hereof and shall have no force or effect. This
Award may not be amended or modified except by a written Award executed by the
parties hereto or their respective successors and legal representatives.
17. Severability. The invalidity or unenforceability
of any provision of this Award shall not affect the validity or enforceability
of any other provision of this Award.
18. No Waiver. The failure of the Employee or the
Company to insist upon strict compliance with any provision of this Award or the
failure to assert any right the Employee or the Company may have under this
Award shall not be deemed to be a waiver of such provision or right or any other
provision or right of this Award.
19. Entire Award. The Employee and the Company
acknowledge that this Award supersedes any prior agreement between the parties
with respect to the subject matter of this Award.
20. Counterparts. This Award may be executed in
counterparts, which together shall constitute one and the same original.
Effective Date: _________, ______
HILLENBRAND INDUSTRIES, INC.
By: ____________________________________
Frederick W. Rockwood, President and
Chief Employee Officer
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