Exhibit 10.4

Exhibit B

Life Time Fitness, Inc.

2011 Long-Term Incentive Plan

Restricted Stock Agreement (Forfeiture Component)

 

 

Name of Employee:

 

   

No. of Shares Covered:

 

  

Date of Issuance:

 

   

Vesting Schedule pursuant to Section 2 (Cumulative):

 

              No. of Shares Which Vesting Date(s)    Become Vested as of Such
Date               

This is a Restricted Stock Agreement (the “Agreement”) between Life Time
Fitness, Inc., a Minnesota corporation (the “Company”), and the employee
identified above (the “Employee”) effective as of the date of issuance specified
above.

RECITALS

WHEREAS, the Company maintains the Life Time Fitness, Inc. 2011 Long-Term
Incentive Plan (the “Plan”);

WHEREAS, pursuant to the Plan, the Company’s Compensation Committee (the
“Committee”), a committee of the Board of Directors (the “Board”), administers
the Plan and the Committee has the authority to grant awards under the Plan on
behalf of the Company;

WHEREAS, the Committee has determined that the Employee is eligible to receive
such an award under the Plan;

NOW, THEREFORE, the Company hereby grants this award of Restricted Shares to the
Employee under the terms and conditions as follows.

TERMS AND CONDITIONS

 

1. Grant of Restricted Stock.

(a) Subject to the terms and conditions of this Agreement, the Company has
issued to the Employee the number of Shares specified at the beginning of this
Agreement. These Shares are subject to the restrictions provided for in this
Agreement and are referred to collectively as the “Restricted Shares” and each
as a “Restricted Share.”

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(b) The Restricted Shares will be evidenced by a book entry made in the records
of the Company’s transfer agent in the name of the Employee (unless the Employee
requests a certificate evidencing the Restricted Shares). All restrictions
provided for in this Agreement will apply to each Restricted Share and to any
other securities distributed with respect to that Restricted Share. Each
Restricted Share will remain restricted and subject to forfeiture to the Company
unless and until that Restricted Share has vested in the Employee in accordance
with all of the terms and conditions of this Agreement. If a certificate
evidencing any Restricted Share is requested by the Employee, the Company shall
retain custody of any such certificate throughout the period during which any
restrictions are in effect and require, as a condition to issuing any such
certificate, that the Employee tender to the Company a stock power duly executed
in blank relating to such custody.

 

2. Vesting. The Restricted Shares that have not previously been forfeited will
vest in the numbers and on the dates specified in the Vesting Schedule at the
beginning of this Agreement. In addition, the Restricted Shares that have not
previously vested or been forfeited will vest immediately upon the first to
occur of the following events: (i) death of the Employee; (ii) Total Disability
of the Employee; and, (iii) a Change of Control as defined in the Plan.
Notwithstanding the foregoing, the number of Restricted Shares vesting on each
date specified in the Vesting Schedule at the beginning of this Agreement may be
reduced based upon the relationship of the Company’s actual fully-diluted
earnings-per-share (“EPS”) for 20     to budgeted EPS for 20    , as
specifically set forth on Exhibit A attached hereto, as such targets may be
amended from time-to-time by the Board. The Committee shall determine whether
the performance hurdle was achieved as promptly as practicable following review
of the Company’s audited fiscal 20     financial results. In the event that a
reduction is applied to the Vesting Schedule at the beginning of this Agreement
(a) such a reduction shall occur immediately upon determination by the Committee
that the performance hurdle was not achieved and (b) if such reduction would
cause the number of Restricted Shares subject to vesting on each date specified
in the Vesting Schedule to be a fraction of a share, the number of Restricted
Shares subject to vesting on each of the first two dates specified in the
Vesting Schedule shall be rounded down to the nearest whole-share while the
number of Restricted Shares subject to vesting on each of the last two dates
specified in the Vesting Schedule shall be rounded up to the nearest
whole-share.

 

3. Lapse of Restrictions; Issuance of Unrestricted Shares. Upon the vesting of
any Restricted Shares, such vested Restricted Shares will no longer be subject
to forfeiture as provided in Section 4 of this Agreement. Upon the vesting of
any Restricted Shares, all restrictions on such Restricted Shares will lapse,
and the Company will, subject to the provisions of the Plan, issue to the
Employee a certificate evidencing the Restricted Shares that is free of any
transfer or other restrictions arising under this Agreement.

 

4.

Forfeiture. In the event that (i) the Employee’s employment is terminated for
any reason, whether by the Company, by the Employee or otherwise, voluntarily or
involuntarily, other than in the circumstances described in Section 2 of this
Agreement, or (iii) the Employee attempts to sell, assign, transfer or otherwise
dispose of, or mortgage, pledge or otherwise encumber any of the Restricted
Shares or the Restricted Shares become subject to attachment or any similar
involuntary process, then any Restricted Shares that have not previously vested
shall be forfeited by the Employee to the Company, the Employee shall thereafter
have no right, title or interest whatever in such Restricted Shares, and, if the
Company does not have custody of any and all certificates representing
Restricted Shares so forfeited, the Employee shall immediately return to the
Company any and all certificates representing Restricted Shares so forfeited.
Additionally, the Employee will deliver to the Company

 

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  a stock power duly executed in blank relating to any and all certificates
representing Restricted Shares forfeited to the Company in accordance with the
previous sentence or, if such stock power has previously been tendered to the
Company, the Company will be authorized to deem such previously tendered stock
power delivered, and the Company will be authorized to cancel any and all
certificates representing Restricted Shares so forfeited and to cause a book
entry to be made in the records of the Company’s transfer agent in the name of
the Employee (or a new stock certificate to be issued, if requested by the
Employee) evidencing any Shares that vested prior to forfeiture. If the
Restricted Shares are evidenced by a book entry made in the records of the
Company’s transfer agent, then the Company will be authorized to cause such book
entry to be adjusted to reflect the number of Restricted Shares so forfeited.

 

5. Shareholder Rights. As of the date of issuance specified at the beginning of
this Agreement, the Employee shall have all of the rights of a shareholder of
the Company with respect to the Restricted Shares (including voting rights and
the right to receive dividends and other distributions), except as otherwise
specifically provided in this Agreement, provided that any dividends or other
distributions shall be distributed only if, when and to the extent that the
Restricted Shares vest and the restrictions lapse.

 

6. Restrictive Legends and Stop-Transfer Orders.

(a) The book entry or certificate representing the Restricted Shares may, at the
Committee’s discretion, contain a notation or bear the following legend (as well
as any notations or legends required by applicable state and federal corporate
and securities laws) noting the existence of the restrictions and the Company’s
rights to reacquire the Restricted Shares set forth in this Agreement:

“THE SHARES REPRESENTED BY THIS [BOOK ENTRY] [CERTIFICATE] MAY BE TRANSFERRED
ONLY IN ACCORDANCE WITH THE TERMS OF A RESTRICTED STOCK AGREEMENT BETWEEN THE
COMPANY AND THE SHAREHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF
THE COMPANY.”

(b) The Employee agrees that, in order to ensure compliance with the
restrictions referred to herein, the Company may issue appropriate “stop
transfer” instructions to its transfer agent, if any, and that, if the Company
transfers its own securities, it may make appropriate notations to the same
effect in its own records.

(c) The Company shall not be required (i) to transfer on its books any
Restricted Shares that have been sold or otherwise transferred in violation of
any of the provisions of this Agreement or (ii) to treat as owner of the
Restricted Shares or to accord the right to vote or pay dividends to any
purchaser or other transferee to whom the Restricted Shares shall have been so
transferred.

 

7. Tax Consequences and Withholdings. The Employee understands that unless a
proper and timely Section 83(b) election has been made as further described
below, generally under Section 83 of the Code, at the time the Restricted Shares
vest, the Employee will be obligated to recognize ordinary income and be taxed
in an amount equal to the Fair Market Value as of the date of vesting for the
Restricted Shares then vesting. The Employee shall be solely responsible for any
tax obligations that may arise as a result of the Restricted Shares.

 

8.

Section 83(b) Election. The Employee has been informed that, with respect to the
grant of Restricted Shares, an election may be filed by the Employee with the
Internal Revenue Service,

 

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  within 30 days of the date of issuance, electing pursuant to Section 83(b) of
the Code to be taxed currently on the Fair Market Value of the Restricted Shares
on the date of issuance. The Employee acknowledges that it is the Employee’s
sole responsibility to timely file the election under Section 83(b) of the Code.

If the Employee makes such election, the Employee shall promptly provide the
Company a copy and the Company may require at the time of such election an
additional payment for withholding tax purposes based on the Fair Market Value
of the Restricted Shares as of the date of issuance.

 

9. Interpretation of This Agreement. All decisions and interpretations made by
the Committee with regard to any question arising hereunder or under the Plan
shall be binding and conclusive upon the Company and the Employee. If there is
any inconsistency between the provisions of this Agreement and the Plan, the
provisions of the Plan shall govern.

 

10. Award Subject to Plan, Articles of Incorporation and By-Laws. The Employee
acknowledges that the Restricted Shares are subject to the Plan, the Articles of
Incorporation, as amended from time to time, and the By-Laws, as amended from
time to time, of the Company, and any applicable federal or state laws, rules or
regulations.

 

11. Binding Effect. This Agreement shall be binding in all respects on the
heirs, representatives, successors and assigns of the Employee.

 

12. Choice of Law. This Agreement is entered into under the laws of the State of
Minnesota and shall be construed and interpreted thereunder (without regard to
its conflict of law principles).

IN WITNESS WHEREOF, the Employee and the Company have executed this Agreement as
of the      day of             , 20    .

 

                         (“Employee”)

 

Life Time Fitness, Inc. By  

 

                                      Its Executive Vice President

 

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Exhibit A

Restricted Stock

Forfeiture Table

 

Actual EPS for          as a Percentage

of 20     Budgeted EPS

    

Percentage of Original Restricted Shares

Granted to be Forfeited

In the event that the Company’s Net Income for 20     is less than $        ,
the entire amount of restricted shares granted pursuant to this Restricted Stock
Agreement shall be forfeited in full.

 

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