Exhibit 10.1

 

UNOVA, INC.

2001 STOCK INCENTIVE PLAN

RESTRICTED STOCK AGREEMENT

 

As Amended March 23, 2005

 

This Restricted Stock Agreement (“Agreement”) is made as of the 9th day of July,
2003 (the “Agreement Date”), between UNOVA, Inc., a Delaware corporation (the
“Company”), and Robert T. Smith (the “Grantee”).

 

WHEREAS, the UNOVA, Inc. 2001 Stock Incentive Plan (the “2001 Plan”) was adopted
by the Board of Directors of the Company on March 13, 2001, and was approved by
the shareholders of the Company on May 8, 2001; and

 

WHEREAS, as an inducement to the Grantee to remain in the employ of the Company
or any of its subsidiaries, to increase the Grantee’s proprietary interest in
the business of the Company through ownership of the Company’s Common Stock, and
to reward the Grantee’s contribution to the Company’s future success, the
Company desires to award the Grantee shares of Restricted Stock (as that term is
defined in the 2001 Plan) in accordance with the terms and conditions of this
Agreement;

 

NOW, THEREFORE, in consideration of the premises, the mutual covenants
hereinafter set forth, and other good and valuable consideration, the Company
and the Grantee hereby agree as follows:

 

1.  The Company hereby grants the Grantee, as a matter of separate inducement
and Agreement, and not in lieu of salary or other compensation for services, an
Award in the form of Restricted Stock comprising 50,000 shares of the Common
Stock, par value $.01 per share, of the Company, on the terms and conditions
hereinafter set forth, such number of shares to be subject to adjustment as
provided in Section 3 of the 2001 Plan.

 

2.  The 2001 Plan, a copy of which is available on the Company’s website at
intranet@unova.com, is incorporated herein by reference and is made part of this
Agreement

 

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as if fully set forth herein.  Capitalized terms used in this Agreement which
are not defined herein shall have the meaning assigned to such terms in the 2001
Plan, it being understood that the term “Restricted Stock” shall mean and refer
only to those shares of Restricted Stock granted pursuant to this Agreement. 
This Agreement is subject to, and the Company and the Grantee agree to be bound
by, all of the terms and conditions of the 2001 Plan as the same existed at the
time this Agreement became effective.  The 2001 Plan shall control in the event
there is any conflict between the 2001 Plan and the terms hereof and with
respect to such matters as are not expressly covered in this Agreement. 
Subsequent amendments to the 2001 Plan shall not adversely affect the Grantee’s
rights under this Agreement without the Grantee’s written consent, except such
an amendment made to cause the 2001 Plan to qualify for the exemption provided
by Rule 16b-3.

 

3.  The Restricted Stock awarded under this Agreement will not be evidenced by a
stock certificate or certificates.  The Restricted Stock will be registered on
the books of the Company by its transfer agent in uncertificated (or book-entry)
form.  A restriction on transfer will be placed on these shares and remain until
such time as they vest in accordance with the terms and conditions (including
forfeiture) of this Agreement and the 2001 Plan.

 

4.  By executing this Agreement, the Grantee agrees and acknowledges that any
shares of Restricted Stock that are forfeited under the terms of this Agreement
will be cancelled.

 

5.  Subject to the provisions of Paragraph 7 of this Agreement, there shall be a
restriction on shares of Restricted Stock awarded hereunder, until the following
Performance Goal is satisfied.  The Performance Goal under this Agreement shall
be the achievement of a material improvement to cash flow and cash flow
efficiency of the UNOVA Industrial Automation Systems Group as determined over
any consecutive four quarters or as of each anniversary of the Agreement Date in
the reasonable discretion of the CEO and the CFO of the Company prior to the
third anniversary of the date of this Agreement (the “Expiration

 

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Date”).  All shares still subject to restriction on the Expiration Date shall be
forfeited.  Partial releases of Restricted Stock may be made following each
anniversary of the Agreement Date if and to the extent the Performance Goal has
been partially satisfied.  Notwithstanding anything to the contrary contained in
Section 7(c)(iv) of the Plan, the Restricted Stock shall not be forfeited upon
Grantee’s Termination of Employment.

 

6.  Until the vesting of any shares of Restricted Stock in accordance with the
provisions of this Agreement or the 2001 Plan, the Grantee shall not be
permitted to sell, assign, transfer, pledge, or otherwise encumber shares of
Restricted Stock; provided that the foregoing shall not prevent the Grantee from
pledging Restricted Stock as security for a loan, the sole purpose of which is
to provide funds to pay the option price for stock options granted to the
Grantee under the 2001 Plan or any successor plan of the Company.

 

7.  Notwithstanding any other provision of this Agreement, all shares of
Restricted Stock granted hereunder still subject to restriction shall become
fully vested and transferable and become free of all restrictions and deferral
limitations to the full extent of the original grant upon the occurrence of any
of the following events:  (a) the Termination of Employment of the Grantee by
reason of the Grantee’s death; (b) the Termination of Employment of the Grantee
by reason of the Grantee’s Disability; or (c) the occurrence of a Change in
Control as defined in Section 8(b) of the 2001 Plan.

 

8.  If, as and when the Performance Goal as to the shares of Restricted Stock
awarded hereunder has been satisfied without a prior forfeiture of the
Restricted Stock, or if and when Restricted Stock vests pursuant to the
provisions of Paragraph 7 hereof, and subject to the payment of withholding
taxes as provided in Paragraph 10 hereof, the Company will direct its transfer
agent to remove the restriction on transfer from the number of shares that have
vested pursuant to Paragraph 5 or Paragraph 7 hereof.  The Company will direct
the transfer agent to periodically send statements to the Grantee indicating the
number of shares being held for the Grantee’s account.

 

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9.  Except as otherwise provided in this Agreement or the 2001 Plan, the Grantee
shall have all rights of a stockholder with respect to the shares of Restricted
Stock awarded hereunder, including the right to vote such shares and the right
to receive any cash dividends which may be declared on the Company’s Common
Stock.  Dividends payable in Common Stock shall be paid in the form of
additional shares of Restricted Stock and shall be held subject to the same
restrictions and vesting provisions applicable to the shares of Restricted Stock
on which such dividends were paid.

 

10.  No later than the date as of which an amount first becomes includable in
the gross income of the Grantee for federal income tax purposes with respect to
any Restricted Stock granted by this Agreement, the Grantee shall pay to the
Company and/or the Grantee’s employer (the “Employer”), or make arrangements
satisfactory to the Company and the Employer regarding the payment of, any
federal, state, local, or foreign taxes of any kind required by law to be
withheld by the Company or the Employer with respect to such amount.  Unless
otherwise determined by the Committee, withholding obligations (up to the
minimum statutory amount required to be withheld by the Company or the Employer)
may be settled with Common Stock, including shares of the Restricted Stock that
give rise to the withholding requirement or shares of Common Stock already owned
by the Grantee for a period of at least six months.  In this regard, to meet the
withholding obligations for the Withholding Taxes (as defined below), the
Company may sell or arrange for the sale of Common Stock acquired by the
Grantee, or the Company may withhold in Common Stock.  The obligations of the
Company under the 2001 Plan shall be conditional on such payment or
arrangements, and the Company, and its subsidiaries and its Affiliates shall, to
the extent permitted by law, have the right to deduct any such taxes from any
payment otherwise due to the Grantee.  Grantee, therefore, hereby
unconditionally and irrevocably elects, notwithstanding anything to the contrary
in this Paragraph 10 or elsewhere in this Agreement, to satisfy any and all
federal, state, local, and foreign taxes of any kind that may

 

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be withheld by the Company in connection with Grantee’s Restricted Stock
(“Withholding Taxes”) by selecting one of the following payment methods;
provided that in all cases, the Company shall have the right to receive not less
than the minimum amount of the Withholding Taxes that the Company is required by
law to withhold (the “Mandatory Withholding Taxes”):

 

OPTION 1:

 

o                                    Authorizing and directing the Company to
deduct from the total number of shares of Company Common Stock issued and
deliverable to Grantee pursuant to this Agreement the number of shares having a
value equal to the Mandatory Withholding Taxes.

 

OPTION 2:

 

o                                    Tendering to the Company the number of
unrestricted shares of Company Common Stock owned by the Grantee for a period of
at least six months prior to the date on which Withholding Taxes are due and
having a value equal to the Mandatory Withholding Taxes.

 

OPTION 3:

 

o                                    Paying to the Company in cash an amount up
to the Withholding Taxes but not less than the Mandatory Withholding Taxes.

 

In the event that none of the payment options set forth above is specified, the
Grantee’s election shall be deemed to be Option 1, and the Company shall proceed
accordingly.

 

11.  Grantee understands and acknowledges that Grantee is one of a limited
number of employees of the Company and its subsidiaries who have been selected
to receive grants of Restricted Stock and that Grantee’s award is considered
Company confidential information.  Grantee hereby covenants and agrees not to
disclose the award of Restricted Stock pursuant to this Agreement under which
this award was made to any other person except (i) Grantee’s immediate family
and legal or financial advisors, provided that Grantee shall assure that such
individuals maintain the confidentiality of this Agreement, and (ii) as required
in connection with the administration of this Agreement and the 2001 Plan as it

 

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relates to this award, in each case, until the award contained in this Agreement
is publicly disclosed.

 

12.  The grant of Restricted Stock to the Grantee in any year shall give the
Grantee neither any right to similar grants in future years nor any right to be
retained in the employ of the Company or its subsidiaries or Affiliates, such
employment being terminable to the same extent as if the 2001 Plan and this
Agreement were not in effect.  The right and power of the Company, its
subsidiaries and Affiliates to dismiss or discharge the Grantee is specifically
and unqualifiedly unimpaired by this Agreement.

 

13.  Each notice relating to this Agreement shall be in writing and delivered in
person or by mail to the Company at its office, 6001 36th Avenue West, Everett,
Washington  98203-1264, to the attention of the Company’s Secretary, or at such
other address as the Company may specify in writing to the Grantee by a notice
delivered in accordance with this paragraph.  All notices to the Grantee shall
be delivered to the Grantee at the Grantee’s address specified below or at such
other address as the Grantee may specify in writing to the Secretary of the
Company by a notice delivered in accordance with this paragraph.

 

14.  This Agreement, including the provisions of the 2001 Plan incorporated by
reference herein, comprises the whole Agreement between the parties hereto with
respect to the subject matter hereof, and shall be governed by and construed in
accordance with the laws of the State of Delaware, without reference to
principles of conflicts of law.  The Committee may amend the terms of this
Agreement at any time, prospectively or retroactively, but no such amendment
shall impair the rights of the Grantee without the Grantee’s written consent,
except such an amendment made to cause this Agreement and the Restricted Stock
granted hereby to qualify for the exemption provided by Rule 16b-3.  This
Agreement shall become effective when it has been executed by the Company and
the Grantee.

 

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15.  This Agreement shall inure to the benefit of and be binding upon each
successor of the Company and, to the extent specifically provided herein and in
the 2001 Plan, shall inure to the benefit of and shall be binding upon the
Grantee’s heirs, legal representatives, and successors.

 

IN WITNESS WHEREOF, this Agreement is executed by the Grantee and by the
Com­pany through its duly authorized officer or officers as of the day and year
first above written.

 

 

UNOVA, INC.

 

 

 

 

 

By:

/s/ Cathy D. Younger

 

 

 

 

GRANTEE:

 

 

 

(One of the boxes under Paragraph 10 should be checked)

 

 

 

/s/ Robert T. Smith

 

 

Signature

 

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