Exhibit 10.13
HOT TOPIC, INC.
1996 EQUITY INCENTIVE PLAN
RESTRICTED STOCK BONUS AGREEMENT
THIS RESTRICTED STOCK BONUS AGREEMENT (the "Agreement") is made as of
the 7th day of March, 2001, by and between Hot Topic, Inc., a California
corporation (the "Company"), and ("DIRECTOR").
WHEREAS, Director is a member of the Board;
WHEREAS, pursuant to the non-employee director compensation policy
adopted by the Board, and in consideration for past services, Director has been
granted a stock bonus under the Company's 1996 Equity Incentive Plan (the
"Plan") for the number of shares of Common Stock set forth below and subject to
vesting and other terms and conditions as provided herein; and
WHEREAS, the issuance of Common Stock pursuant to the stock bonus
described herein is further subject to all the terms and conditions of the Plan
and defined terms not explicitly defined in this Agreement but defined in the
Plan shall have the same definitions as in the Plan.
NOW, THEREFORE, IT IS AGREED between the parties as follows:
1. AWARD OF STOCK. The Company hereby awards to Director a stock bonus
covering an aggregate of ____________ (_____) shares of Common Stock (the
"Shares"), with a Fair Market Value of $________ per share, for an aggregate
award value of $____________, in consideration of past services as a member of
the Board.
2. VESTING. Provided that Director has not ceased to be a member of the
Board for any reason (including death) or no reason, with or without cause, at
any time during the period beginning on the date hereof and ending March 6,
2002, the Shares shall vest on March 7, 2002.
3. RIGHT OF REACQUISITION. The Company shall reacquire the Shares that
have not yet vested in accordance with Section 2 herein (the "Unvested Shares")
on the following terms and conditions (the "Reacquisition Right"):
(a) In the event of a termination of Director's service as a
member of the Board occurring on or before March 6, 2002, the Company shall
automatically reacquire for no consideration (monetary or otherwise) all of the
Unvested Shares, unless the Company agrees to waive its Reacquisition Right as
to some or all of the Unvested Shares. Any such waiver shall be exercised by the
Company by written notice to Director or his representative (with a copy to the
Escrow Holder as defined below) within ninety (90) days after termination of
Director's service as a member of the Board, and the Escrow Holder may then
release to Director the number of Unvested Shares not being reacquired by the
Company. If the Company does not waive its reacquisition right as to all of the
Unvested Shares, then on the date that is ninety-one (91) days after termination
of Director's service as a member of the Board, the Escrow Holder shall transfer
to the Company the number of shares the Company is reacquiring.
1.
(b) To facilitate operation of the Company's Reacquisition
Right, the Shares shall be held in escrow pursuant to the terms of the Joint
Escrow Instructions attached hereto as Exhibit A and incorporated herein by this
reference. Director agrees to execute three (3) Assignment Separate From
Certificate forms (with date and number of shares blank) attached hereto as
Exhibit B and incorporated herein by this reference and deliver the same, along
with the Joint Escrow Instructions and certificate or certificates evidencing
the shares, for use by the escrow agent designated pursuant to the terms of such
Joint Escrow Instructions (the "Escrow Agent") (provided, however, the parties
agree that the Shares may be uncertificated, and Director hereby instructs and
authorizes the Company to hold and maintain evidence of ownership in its sole
control with the Company's transfer agent pursuant to the terms hereof).
Director hereby authorizes Escrow Agent to implement in its discretion the
services of the Company's transfer agent for any of the foregoing.
4. RIGHTS OF DIRECTOR. Except as otherwise provided in Section 7
herein, Director shall exercise all rights and privileges of a shareholder of
the Company with respect to the Shares deposited in escrow. Director shall be
deemed to be the holder of the Shares for purposes of receiving any dividends
which may be paid with respect to such shares and for purposes of exercising any
voting rights relating to such shares, even if some or all of such Shares have
not yet vested and been released from the Company's Reacquisition Right.
5. CAPITALIZATION ADJUSTMENTS TO COMMON STOCK. In the event of a
capitalization adjustment affecting the Common Stock as a class as described in
subsection 13(a) of the Plan, then any and all new, substituted or additional
securities or other property to which Director is entitled by reason of
Director's ownership of the Shares shall be immediately subject to the
Reacquisition Right and any other applicable restrictions as described in
Section 7 herein and shall and be included in the word "Shares" for all purposes
of the Reacquisition Right and Section 7 restrictions with the same force and
effect as the Shares presently subject to the Reacquisition Right and Section 7
restrictions, but only to the extent the Shares are, at the time, covered by
such Reacquisition Right and Section 7 restrictions.
6. CORPORATE TRANSACTIONS. In the event of a dissolution, liquidation,
merger or other corporate transaction as described in subsection 13(b) of the
Plan, then the Reacquisition Right may be assigned by the Company to the
successor of the Company (or such successor's parent company), if any, in
connection with such transaction. To the extent the Reacquisition Right and/or
Section 7 restrictions remain in effect following such transaction, it or each,
as applicable, shall apply to the new capital stock or other property received
in exchange for the Shares in consummation of such transaction, but only to the
extent the Shares were at the time covered by such right or restriction. The
Reacquisition Right shall apply if Director does not continue service on the
Board of Directors of such successor (or its parent or subsidiaries). In such
case, the references herein to the "Company" shall be deemed to refer to such
successor.
7. LIMITATIONS ON TRANSFER. Director shall not sell, assign,
hypothecate, donate, encumber or otherwise dispose of any interest in the Shares
except in compliance with the provisions herein and applicable securities laws.
Until such time as Director ceases to serve as a member of the Board, the Shares
may not be sold, assigned, hypothecated, encumbered or otherwise disposed of in
any manner without the written consent of the Company and any attempt to do so
shall be void. The Company shall not be required (a) to transfer on its books
2.
any of the Shares which shall have been transferred in violation of any of the
provisions set forth in this Agreement or (b) to treat as owner of such shares
or to accord the right to vote as such owner or to pay dividends to any
transferee to whom such shares shall have been so transferred.
8. RESTRICTIVE LEGENDS. Until (i) March 7, 2002, in the case of the
first legend below, (ii) such time as Director ceases to serve as a member of
the Board, in the case of the second legend below, and (iii) such time as the
Company shall determine in its discretion, in the case of the third legend below
and any other legend(s), all certificates representing the Shares shall have
endorsed thereon legends in substantially the following forms (in addition to
any other legend which may be required by other agreements between the parties
hereto or be advisable in the discretion of the Company):
(a) "SOME OR ALL OF THE SHARES REPRESENTED BY THIS CERTIFICATE
ARE SUBJECT TO A REACQUISITION RIGHT IN FAVOR OF HOT TOPIC, INC., AND ANY
SUCCESSOR ENTITY UNTIL MARCH 6, 2002, AS SET FORTH IN A RESTRICTED STOCK BONUS
AGREEMENT BETWEEN THE COMPANY AND THE HOLDER, A COPY OF WHICH IS ON FILE AT THE
PRINCIPAL OFFICE OF THE COMPANY. ANY TRANSFER OR ATTEMPTED TRANSFER OF ANY
SHARES SUBJECT TO SUCH REPURCHASE OPTION IS VOID WITHOUT THE PRIOR EXPRESS
WRITTEN CONSENT OF THE ISSUER OF THESE SHARES."
(b) "THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE
SOLD, OFFERED FOR SALE, PLEDGED, HYPOTHECATED OR OTHERWISE SUBJECT TO
DISPOSITION EXCEPT AS PROVIDED FOR IN A RESTRICTED STOCK BONUS AGREEMENT BETWEEN
THE COMPANY AND THE HOLDER, A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICE
OF THE COMPANY. ANY TRANSFER OR ATTEMPTED TRANSFER OR OTHER DISPOSITION OF ANY
SHARES SUBJECT TO THE STOCK AGREEMENT IS VOID WITHOUT THE PRIOR EXPRESS WRITTEN
CONSENT OF THE ISSUER OF THESE SHARES."
(c) The Affiliate legend.
9. AWARD NOT A SERVICE CONTRACT. Director acknowledges that neither
this Agreement nor the stock bonus granted to Director constitutes an employment
or service contract with the Company or an Affiliate, and nothing in this
Agreement shall be deemed to create in any way whatsoever any obligation on
Director's to continue any relationship he may have as a Director for the
Company.
10. TAX CONSEQUENCES. The acquisition and vesting of the Shares may
have adverse tax consequences to Director that may be voided or mitigated by
filing an election under Section 83(b) of the Internal Revenue Code, as amended
(the "Code"). Such election must be filed within thirty (30) days after the date
of grant of the stock bonus described herein. DIRECTOR ACKNOWLEDGES THAT IT IS
HIS RESPONSIBILITY, AND NOT THE COMPANY'S, TO FILE A TIMELY ELECTION UNDER CODE
SECTION 83(B), EVEN IF HE REQUESTS THE COMPANY TO MAKE THE FILING ON HIS BEHALF.
11. GOVERNING PLAN DOCUMENT. This Agreement is subject to all the
provisions of the Plan, the provisions of which are hereby made a part of this
Agreement, and is further subject to all interpretations, amendments, rules and
regulations which may from time to time be promulgated and adopted pursuant to
the Plan. In the event of any conflict between the provisions of this Agreement
and those of the Plan, the provisions of the Plan shall control.
3.
12. MISCELLANEOUS.
(a) NOTICES. Any notice required or permitted hereunder shall
be given in writing and shall be deemed effectively given upon personal delivery
or sent by telegram or fax or upon deposit in the United States Post Office, by
registered or certified mail with postage and fees prepaid, addressed to the
other party hereto at his address hereinafter shown below its signature or at
such other address as such party may designate by ten (10) days' advance written
notice to the other party hereto.
(b) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of the successors and assigns of the Company and, subject to the
restrictions on transfer herein set forth, be binding upon Director, Director's
successors, and assigns.
(c) ATTORNEYS' FEES; SPECIFIC PERFORMANCE. Director shall
reimburse the Company for all costs incurred by the Company in enforcing the
performance of, or protecting its rights under, any part of this Agreement,
including reasonable costs of investigation and attorneys' fees.
(d) GOVERNING LAW; VENUE. This Agreement shall be governed by
and construed in accordance with the laws of the State of California. The
parties agree that any action brought by either party to interpret or enforce
any provision of this Agreement shall be brought in, and each party agrees to,
and does hereby, submit to the jurisdiction and venue of, the appropriate state
or federal court for the district encompassing the Company's principal place of
business.
(e) FURTHER EXECUTION. The parties agree to take all such
further action(s) as may reasonably be necessary to carry out and consummate
this Agreement as soon as practicable, and to take whatever steps may be
necessary to obtain any governmental approval in connection with or otherwise
qualify the issuance of the securities that are the subject of this Agreement.
(f) INDEPENDENT COUNSEL. Director acknowledges that this
Agreement has been prepared on behalf of the Company by Cooley Godward LLP,
counsel to the Company and that Cooley Godward LLP does not represent, and is
not acting on behalf of, Director. Director has been provided with an
opportunity to consult with Director's own counsel with respect to this
Agreement.
(g) ENTIRE AGREEMENT; AMENDMENT. This Agreement constitutes
the entire agreement between the parties with respect to the subject matter
hereof and supersedes and merges all prior agreements or understandings, whether
written or oral. This Agreement may not be amended, modified or revoked, in
whole or in part, except by an agreement in writing signed by each of the
parties hereto.
4.
(h) SEVERABILITY. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, the parties agree to
renegotiate such provision in good faith. In the event that the parties cannot
reach a mutually agreeable and enforceable replacement for such provision, then
(i) such provision shall be excluded from this Agreement, (ii) the balance of
the Agreement shall be interpreted as if such provision were so excluded and
(iii) the balance of the Agreement shall be enforceable in accordance with its
terms.
(i) COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
HOT TOPIC, INC.
By:
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Title:
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Address: 8305 E. San Jose Avenue
City of Industry, CA 91748
DIRECTOR:
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Address:
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5.
EXHIBIT A
STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE
STOCK ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED, _______________________ hereby sells, assigns and
transfers unto Hot Topic, Inc., a California corporation (the "Company"),
pursuant to the Reacquisition Right under that certain Restricted Stock Bonus
Agreement, dated as of March 7, 2001 by and between the undersigned and the
Company (the "Agreement"), _____________________ shares of Common Stock of the
Company standing in the undersigned's name on the books of the Company
represented by Certificate No(s). _______________ (or uncertificated and
recorded at the office of the Company's transfer agent, if applicable) and does
hereby irrevocably constitute and appoint the Company's Chief Financial Officer
as attorney to transfer said Common Stock on the books of the Company with full
power of substitution in the premises. This Assignment may be used only in
accordance with and subject to the terms and conditions of the Agreement, in
connection with the reacquisition of shares of Common Stock issued to the
undersigned pursuant to the Agreement, and only to the extent that such shares
remain subject to the Company's Reacquisition Right under the Agreement.
Dated: _______________
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(Signature)
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(Print Name)
(INSTRUCTION: PLEASE DO NOT FILL IN ANY BLANKS OTHER THAN THE "SIGNATURE" LINE
AND THE "PRINT NAME" LINE.)
SIGNATURE MUST BE MEDALLION GUARANTEED
EXHIBIT B
JOINT ESCROW INSTRUCTIONS
JOINT ESCROW INSTRUCTIONS
Chief Financial Officer
Hot Topic, Inc.
18305 E. San Jose Avenue
City of Industry, CA 91748
Ladies and Gentlemen:
As Escrow Agent for both HOT TOPIC, INC., a California corporation ("Company")
and _____________ ("Director"), you are hereby authorized and directed to hold
the documents delivered to you pursuant to the terms of that certain Restricted
Stock Bonus Agreement dated as of ___________, 2001 ("Agreement"), to which a
copy of these Joint Escrow Instructions is attached as Exhibit B, in accordance
with the following instructions:
1. In the event of a termination of Director's service as a member of
the Board occurring on or before March 6, 2002, the Company will provide you
with notice of such termination of Director's service. Unless you receive a
written notice from the Company stating that the Company intends to waive all or
any part of its Reacquisition Right as described in the Agreement (in which case
the number of shares transferred shall be as indicated in such notice), on the
ninety-first day following such termination of Director's service (unless the
Company requests in writing that the actions contemplated herein occur within a
shorter period following such termination of Director's service), you are
directed (a) to date the stock assignments necessary for the transfer in
question, (b) to fill in the number of shares being transferred (which shall be
all of the Shares as defined in the Agreement unless the Company has elected to
waive its Reacquisition Right with respect to any portion of the Shares), and
(c) to deliver the same, together with the certificate evidencing the shares of
stock to be transferred, to the Company for the number of shares of stock being
reacquired pursuant to operation of the Reacquisition Right.
2. Director and the Company hereby irrevocably authorize and direct you
to effectuate the transfer described above in accordance with the terms set
forth herein and in the Agreement without further action by either Director or
the Company (other than the written notice of termination as described above).
3. As of the date of the Agreement, Director irrevocably authorizes the
Company to deposit with you any certificates evidencing shares of stock to be
held by you hereunder and any additions and substitutions to said shares as
specified in the Agreement. Director does hereby irrevocably constitute and
appoint you as his attorney-in-fact and agent for the term of this escrow to
execute with respect to such securities all documents necessary or appropriate
to make such securities negotiable and complete any transaction herein
contemplated, including but not limited to any appropriate filing with state or
government officials or bank officials. Subject to the provisions of this
paragraph 3 and as otherwise provided in the Agreement, Director shall exercise
all rights and privileges of a shareholder of the Company while the stock is
held by you.
4. This escrow shall terminate upon the expiration, execution or waiver
in full of the Company's Reacquisition Right in full.
1.
5. If at the time of termination of this escrow you should have in your
possession any documents, securities, or other property belonging to Director,
you shall deliver all of the same to Director and shall be discharged of all
further obligations hereunder; provided, however, that if at the time of
termination of this escrow you are advised by the Company that any property
subject to this escrow is the subject of a pledge or other security agreement,
you shall deliver all such property to the pledgeholder or other person
designated by the Company.
6. Except as otherwise provided in these Joint Escrow Instructions,
your duties hereunder may be altered, amended, modified or revoked only by a
writing signed by all of the parties hereto.
7. You shall be obligated only for the performance of such duties as
are specifically set forth herein and may rely and shall be protected in relying
or refraining from acting on any instrument reasonably believed by you to be
genuine and to have been signed or presented by the proper party or parties. You
shall not be personally liable for any act you may do or omit to do hereunder as
Escrow Agent or as attorney-in-fact for Director while acting in good faith and
in the exercise of your own good judgment, and any act done or omitted by you
pursuant to the advice of your own attorneys shall be conclusive evidence of
such good faith.
8. You are hereby expressly authorized to disregard any and all
warnings given by any of the parties hereto or by any other person or
corporation, excepting only orders or process of courts of law, and are hereby
expressly authorized to comply with and obey orders, judgments or decrees of any
court. In case you obey or comply with any such order, judgment or decree of any
court, you shall not be liable to any of the parties hereto or to any other
person, firm or corporation by reason of such compliance, notwithstanding any
such order, judgment or decree being subsequently reversed, modified, annulled,
set aside, vacated or found to have been entered without jurisdiction.
9. You shall not be liable in any respect on account of the identity,
authorities or rights of the parties executing or delivering or purporting to
execute or deliver the Agreement or any documents or papers deposited or called
for hereunder.
10. You shall not be liable for the outlawing of any rights under any
statute of limitations with respect to these Joint Escrow Instructions or any
documents deposited with you.
11. Your responsibilities as Escrow Agent hereunder shall terminate if
you shall cease to be Chief Financial Officer of the Company or if you shall
resign by written notice to each party. In the event of any such termination,
the Company shall appoint any officer or assistant officer of the Company as
successor Escrow Agent, and Director hereby confirms the appointment of such
successor as his attorney-in-fact and agent to the full extent of your
appointment.
12. If you reasonably require other or further instruments in
connection with these Joint Escrow Instructions or obligations in respect
hereto, the necessary parties hereto shall join in furnishing such instruments.
2.
13. It is understood and agreed that should any dispute arise with
respect to the delivery and/or ownership or right of possession of the
securities held by you hereunder, you are authorized and directed to retain in
your possession without liability to anyone all or any part of said securities
until such dispute shall have been settled either by mutual written agreement of
the parties concerned or by a final order, decree or judgment of a court of
competent jurisdiction after the time for appeal has expired and no appeal has
been perfected, but you shall be under no duty whatsoever to institute or defend
any such proceedings.
14. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given upon personal delivery, including
delivery by express courier, or five (5) days after deposit in the United States
Post Office, by registered or certified mail with postage and fees prepaid,
addressed to each of the other parties entitled to such notice at the following
addresses, or at such other addresses as a party may designate by ten days'
advance written notice to each of the other parties hereto.
COMPANY: HOT TOPIC, INC.
18305 E. San Jose Avenue
City of Industry, CA 91748
DIRECTOR:
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ESCROW AGENT: HOT TOPIC, INC.
Attention: Chief Financial Officer
18305 E. San Jose Avenue
City of Industry, CA 91748
15. By signing these Joint Escrow Instructions, you become a party
hereto only for the purpose of said Joint Escrow Instructions; you do not become
a party to the Agreement.
16. You shall be entitled to employ such legal counsel and other
experts (including, without limitation, the firm of Cooley Godward LLP) as you
may deem necessary properly to advise you in connection with your obligations
hereunder. You may rely upon the advice of such counsel, and you may pay such
counsel reasonable compensation therefor. The Company shall be responsible for
all fees generated by such legal counsel in connection with your obligations
hereunder.
17. You are expressly permitted to use the services of the Company's
transfer agent to hold the shares subject to this escrow (in certificated or
uncertificated form), to make transfers permitted hereby, and to otherwise
implement this escrow in your discretion. The parties agree that such transfer
agent shall hold such shares for the benefit of the Company as security for
those matters described in the Agreement, and shall exercise complete control
over such shares pursuant to the terms hereof, and that Director shall have no
right to possession or control of such shares except as provided herein.
3.
18. This instrument shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and permitted assigns. It is
understood and agreed that references to "you" and "your" herein refer to the
original Escrow Agents. It is understood and agreed that the Company may at any
time or from time to time assign its rights under the Agreement and these Joint
Escrow Instructions.
19. This Agreement shall be governed by and interpreted and determined
in accordance with the laws of the State of California, as such laws are applied
by California courts to contracts made and to be performed entirely in
California by residents of that state.
Very truly yours,
HOT TOPIC, INC.
By
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DIRECTOR
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ESCROW AGENT:
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Chief Financial Officer
4.