Exhibit 10.1
[DATE]
Dear ______________:
I am very pleased to announce that the Board of Directors of Universal
Technical Institute, Inc. ("Company") has granted you ____ shares of restricted
stock under the Universal Technical Institute, Inc. 2003 Stock Incentive Plan
("Plan") as of ________________, 2006 ("Grant Date"). This letter serves as the
Restricted Stock Agreement ("Agreement") between the Company and you
("Grantee").
RECITALS
A. The Company has adopted the Plan to provide incentives to
attract and retain those individuals whose services are considered valuable by
providing them an opportunity to own stock in the Company.
B. The Company believes that entering into this Agreement with
you is consistent with those purposes. Any capitalized term not defined in this
Agreement is defined in the Plan.
NOW, THEREFORE, the Company and you agree as follows:
AGREEMENT
1. GRANT OF RESTRICTED SHARES. Subject to the terms of this
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Agreement and the Plan, the Company grants to you _______ shares ("Restricted
Shares") of the Company's common stock ("Stock"). The delivery of any document
evidencing the Restricted Shares is subject to the provisions of Section 10.4 of
the Plan.
2. YOUR RIGHTS AS A GRANT RECIPIENT. Subject to the provisions of
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this Agreement and the Plan, as of the Grant Date, you shall be a shareholder
with respect to all of such Restricted Shares and shall have all of the rights
of a shareholder in the Company with respect to the Restricted Shares (e.g., you
may vote the Restricted Shares at any meeting of the stockholders of the
Company). The Restricted Shares and your rights and obligations relating to
those shares shall at all times be subject to the provisions of the Plan as in
effect from time to time. The Plan is a part of this Agreement.
3. RESTRICTIONS ON RESTRICTED SHARES.
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A. Limitations on Transfer. You agree to not sell,
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transfer, pledge, exchange, hypothecate, grant any security interest in, or
otherwise dispose of, any Restricted Shares (or your interest in such shares)
before the date on which the restrictions lapse under Section 4.A. (below), or
enter into any agreement or make any commitment to do so. Any attempted sale,
transfer, pledge, exchange, hypothecation or disposition of the Restricted
Shares (or your interest in such shares) in violation of this Agreement will not
be recognized by the Company or its transfer agent.
B. Permitted Transfers. Notwithstanding Section 3.A.
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(above), you may assign or transfer some or all of the Restricted Shares
pursuant to Section 13.5 of the Plan, provided the assignee or transferee shall
remain subject to the same restrictions and limitations to which you are subject
under this Agreement and the Plan.
4. LAPSE OF RESTRICTIONS.
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A. Schedule. Subject to the other conditions in this
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Agreement, the restrictions on the Restricted Shares set forth in Section 3
(above) will lapse under the following schedule:
Percentage of Shares with Date on Which
Lapsing Restrictions Restrictions Lapse
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First 25% One year anniversary from Grant Date
Second 25% Two year anniversary from Grant Date
Third 25% Three year anniversary from Grant Date
Last 25% Four year anniversary from Grant Date
Notwithstanding the above schedule, all restrictions on the
Restricted Shares shall lapse upon (i) your death, (ii) your Disability, or
(iii) if, within one year following a Change of Control, your employment with,
or service to, the Company is terminated without Cause or you terminate your
employment or service for Good Reason. If your employment with, or service to,
the Company is terminated for any other reason, all shares of Restricted Shares
that are at that time subject to the restrictions under Section 3 (above) and
this Section 4 shall be forfeited as provided in Section 10.3 of the Plan.
"Cause" shall have the definition set forth in the Plan and shall additionally
include your willful and/or gross misconduct that results in significant harm to
the Company or its operations, properties, reputation, goodwill or business
relationships as determined by the Company in its sole reasonable discretion.
B. Condition That Must be Satisfied Before Restrictions
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Lapse. The restrictions on each percentage of the Restricted Shares (set forth
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in the above schedule) will not lapse unless you remain employed by, or in the
service of, the Company (or a Subsidiary) as of the date the restrictions lapse
in accordance with the above schedule.
5. ACKNOWLEDGEMENTS AND REPRESENTATION. In connection with you
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receiving the Restricted Shares, you hereby acknowledge the following:
A. Further Limitations on Disposition. You understand
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and acknowledge that you may not make any sale, assignment, transfer or other
disposition (including transfer by gift or operation of law) of all or any
portion of the Restricted Shares except in accordance with this Agreement.
Further, you agree to make no sale, assignment, transfer or other disposition of
all or any portion of the Restricted Shares unless there is then in effect a
registration statement under the Securities Act of 1933, as amended, covering
such proposed disposition and such disposition is made in accordance with such
registration statement, or you have obtained an opinion of your counsel that
such disposition does not require registration under the Securities Act. The
Company may request a copy of any such opinion and, upon such request, you shall
promptly provide such copy to the Company.
B. Section 83(b) Election. You understand that Section
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83 of the Internal Revenue Code of 1986, as amended ("Code"), taxes as ordinary
income the difference between the amount paid for the Restricted Shares and the
Fair Market Value of the Restricted Shares as of the date any restrictions on
the Restricted Shares lapse. In this context, "restriction" means the
restrictions under Section 3 (above). You may elect to be taxed at the time the
Restricted Shares are granted rather than when and as the Restricted Shares
become unrestricted by filing an election under Section 83(b) of the Code with
the Internal Revenue Service within thirty (30) days from the Grant Date. If you
fail to make this filing timely you will recognize ordinary income equal to the
Fair Market Value of the Restricted Shares at the time such restrictions lapse
under Section 3 (above).
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YOU ACKNOWLEDGE THAT IT IS YOUR SOLE RESPONSIBILITY, AND NOT
THE COMPANY'S, TO FILE TIMELY THE ELECTION UNDER SECTION 83(b)
OF THE CODE, EVEN IF YOU REQUEST THE COMPANY OR ITS
REPRESENTATIVES TO MAKE THIS FILING ON YOUR BEHALF.
YOU ARE URGED TO SEEK INDEPENDENT ADVICE WITH RESPECT TO THE
CONSEQUENCES UNDER FEDERAL AND STATE SECURITIES AND INCOME TAX
LAWS AND THE DUTIES IMPOSED UPON YOU RELATED TO THE AWARD OF
RESTRICTED SHARES AND DISPOSITION OF THE RESTRICTED SHARES.
If you file an election under Section 83(b) of the Code, you
agree to give the Company notice of such election at the time
you file such election.
6. FEDERAL AND STATE TAXES. You may incur certain liabilities for
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federal, state or local taxes in connection with the grant of the Restricted
Shares hereunder, and the Company may be required by law to withhold such taxes.
You agree that, at the option of the Company, the Company may withhold all
applicable taxes at the time of vesting of the Restricted Stock by reducing the
number of shares issued to you by that number of shares which is necessary to
satisfy the tax obligation arising from the vesting of the shares. If the number
of shares issuable to you following satisfaction of the tax obligation (as
described in the foregoing sentence) includes any fractional shares, you agree
that the Company may issue to you a cash payment in lieu of such fractional
share.
7. ADJUSTMENT OF SHARES. The number of Restricted Shares issued
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to you pursuant to this Agreement shall be adjusted by the Committee pursuant to
Article 14 of the Plan, in its discretion, in the event of a change in the
Company's capital structure.
8. AMENDMENT OF AGREEMENT. This Agreement may only be amended
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with the written approval of you and the Company.
9. GOVERNING LAW. This Agreement shall be governed in all
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respects, whether as to validity, construction, capacity, performance or
otherwise, by the laws of the State of Delaware, without regard to
conflicts-of-laws principles that would require the application of any other
law.
10. SEVERABILITY. If any provision of this Agreement, or the
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application of any such provision to any person or circumstance, is held to be
unenforceable or invalid by any court of competent jurisdiction or under any
applicable law, the parties hereto shall negotiate an equitable adjustment to
the provisions of this Agreement with the view to effecting, to the greatest
extent possible, the original purpose and intent of this Agreement, and in any
event, the validity and enforceability of the remaining provisions of this
Agreement shall not be affected thereby.
11. ENTIRE AGREEMENT. This Agreement constitutes the entire,
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final, and complete agreement between the parties hereto with respect to the
subject matter hereof and supersedes all prior agreements, promises,
understandings, negotiations, representations, and commitments, both written and
oral, between the parties hereto with respect to the subject matter hereof.
Neither party hereto shall be bound by or liable for any statement,
representation, promise, inducement, commitment or understanding of any kind
whatsoever not expressly set forth in this Agreement.
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IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed by its duly authorized representative and you have signed this
Agreement, in each case as of the day and year first written above. By your
signature below, you accept and agree to abide by the terms of this Agreement
and you further agree to be bound by and to comply with all terms and conditions
of the Plan. By your signature below, you acknowledge that you have received a
copy of the Plan, and understand that you may receive a copy of the Plan as
amended and in effect at any time by requesting a copy from the Company's
Secretary. Please acknowledge that you received this agreement by signing a copy
and returning it to the Company's People Services Department via the
pre-addressed, postage paid envelope provided to you by ________________,
20_____.
UNIVERSAL TECHNICAL INSTITUTE, INC.
By: /s/ Kim McWaters
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Kim McWaters, President and CEO
GRANTEE:
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