Exhibit 10.4
SXC HEALTH SOLUTIONS CORP.
RESTRICTED STOCK UNIT AWARD AGREEMENT
SXC Health Solutions Corp., a corporation existing under the laws of the Yukon
Territory of Canada (the “Company”), hereby grants             (the “Director”)
as of                     ,                      (the “Grant Date”), pursuant to
Section 7.2 of the SXC Health Solutions Corp. Long-Term Incentive Plan (the
“Plan”), a restricted stock unit award (the “Award”) of           restricted
stock units, upon and subject to the restrictions, terms and conditions set
forth below. Capitalized terms not defined herein shall have the meanings
specified in the Plan.
1. Award Subject to Acceptance of Agreement. The Award shall be null and void
unless the Director shall accept this Agreement by executing it in the space
provided below and returning it to the Company.
2. Restriction Period and Vesting. (a) Subject to Section 2(e), the Award shall
vest (i) with respect to one-quarter (1/4) of the restricted stock units subject
to the Award on the first anniversary of the Grant Date, an additional
one-quarter (1/4) of the restricted stock units subject to the Award on the
second anniversary of the Grant Date, an additional one-quarter (1/4) of the
restricted stock units subject to the Award on the third anniversary of the
Grant Date, and the remaining one-quarter (1/4) of the restricted stock units
subject to the Award on the fourth anniversary of the Grant Date, or
(ii) earlier pursuant to Section 2(b) or (d) hereof (the “Restriction Period”).
(b) Subject to Section 2(e), if the Director’s service terminates by reason of
permanent disability or due to death, the Award shall become fully vested as of
the effective date of the Director’s termination of service or the date of
death, as the case may be. For purposes of this Agreement, “permanent
disability” shall mean the inability of the Director to substantially perform
his or her duties for a continuous period of at least six months as determined
by the Committee.
(c) Subject to Section 2(e), if the Director’s service to the Company terminates
for any reason other than permanent disability or death, the portion of the
Award, if any, which is not vested as of the effective date of the Director’s
termination of service shall be forfeited and cancelled by the Company.
(d) (1) In the event of a Change in Control (as defined in Appendix A), the
Award shall immediately vest in full.
(2) In the event of a Change in Control pursuant to paragraph (3) or (4) of
Appendix A, the Board of Directors (as constituted prior to such Change in
Control) may, in its discretion (subject to existing contractual arrangements):

  (i)   require that shares of stock of the corporation resulting from such
Change in Control, or a parent corporation thereof, be substituted for some or
all of the Shares (as defined in Section 3) issuable pursuant to the Award, as
determined by the Board of Directors; and/or

 

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  (ii)   require the Award, in whole or in part, to be surrendered to the
Company by the Director and to be immediately cancelled by the Company, and
provide for the Director to receive a cash payment in an amount not less than
the amount determined by multiplying the number of restricted stock units
subject to the Award immediately prior to such cancellation (but after giving
effect to any adjustment pursuant to Section 12.4 of the Plan in respect of any
transaction that gives rise to such Change in Control) by the highest per share
price offered to holders of shares of the Company’s common stock, no par value
per share (the “Common Stock”), in any transaction whereby the Change in Control
takes place.

(3) The Company may, but is not required to, cooperate with the Director if the
Director is subject to Section 16 of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”), to assure that any cash payment or substitution in
accordance with the foregoing to the Director is made in compliance with
Section 16 and the rules and regulations thereunder.
3. Conversion of Restricted Stock Units and Issuance of Shares. Upon the vesting
of all or any portion of the Award in accordance with Section 2 hereof, one
share of the Common Stock shall be issuable for each restricted stock unit that
vests on such date (the “Shares”), subject to the terms and provisions of the
Plan and this Agreement, and not later than 30 days thereafter, the Company will
transfer such Shares to the Director. No fractional shares shall be issued under
this Agreement.
4. No Rights as a Shareholder; Dividend Equivalents. Prior to the issuance and
transfer of Shares upon vesting, the Director will be credited with amounts
equal to any cash dividends that would be payable to the Director if the
Director had been transferred such Shares, which amounts shall accrue during the
Restriction Period and be paid in cash upon lapse of the Restriction Period.
This Section 4 will not apply with respect to record dates for dividends
occurring prior to the Grant Date or after the Restriction Period has lapsed.
During the Restriction Period, the Director (and any person succeeding to the
Director’s rights pursuant to the Plan) will not be a shareholder of record of
the Shares underlying the Award and will have no voting or other shareholder
rights with respect to such Shares.
5. Termination of Award. In the event that the Director shall forfeit all or a
portion of the restricted stock units subject to the Award, the Director shall
promptly return this Agreement to the Company for cancellation. Such
cancellation shall be effective regardless of whether the Director returns this
Agreement.
6. Additional Terms and Conditions of Award.
6.1 Nontransferability of Award. During the Restriction Period, the restricted
stock units subject to the Award and not then vested may not be transferred by
the Director other than by will, the laws of descent and distribution or
pursuant to Section 12.5 of the Plan on a beneficiary designation form approved
by the Company. Except as permitted by the foregoing, during the Restriction
Period, the restricted stock units subject to the Award and not then vested may
not be sold, transferred, assigned, pledged, hypothecated, encumbered or
otherwise disposed of (whether by operation of law or otherwise) or be subject
to execution, attachment or similar process. Any such attempted sale, transfer,
assignment, pledge, hypothecation or encumbrance, or other disposition of such
shares shall be null and void.

 

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6.2. Withholding Taxes. The Director understands and agrees that he or she is
responsible for, and shall pay, all applicable federal, state or local taxes
arising out of or relating to this Award. Notwithstanding the foregoing, if
required by applicable law, as a condition precedent to the delivery to the
Director of any of the Shares subject to the Award, the Director shall, upon
request by the Company, pay to the Company (or shall cause a broker-dealer on
behalf of the Director to pay to the Company) such amount of cash as the Company
may be required, under all applicable federal, state, local or other laws or
regulations, to withhold and pay over as income or other withholding taxes with
respect to the Award.
6.3. Compliance with Applicable Law. The Award is subject to the condition that
if the listing, registration or qualification of the Shares subject to the Award
upon any securities exchange or under any law, or the consent or approval of any
governmental body, or the taking of any other action is necessary or desirable
as a condition of, or in connection with, the vesting of the restricted stock
units or the delivery of the Shares hereunder, the Shares subject to the Award
may not be delivered, in whole or in part, unless such listing, registration,
qualification, consent or approval shall have been effected or obtained, free of
any conditions not acceptable to the Company. The Company agrees to use
reasonable efforts to effect or obtain any such listing, registration,
qualification, consent or approval.
6.4. Delivery of Certificates. As soon as practicable after the vesting of the
Award, in whole or in part, the Company shall deliver or cause to be delivered
one or more certificates issued in the Director’s name (or such other name as is
acceptable to the Company and designated in writing by the Director)
representing the number of vested shares.
6.5. Award Confers No Rights to Continued Service. In no event shall the
granting of the Award or its acceptance by the Director give or be deemed to
give the Director any right to continued service by the Company or any Affiliate
of the Company.
6.6. Decisions of Board or Committee. The Board of Directors of the Company or
the Committee shall have the right to resolve all questions which may arise in
connection with the Award. Any interpretation, determination or other action
made or taken by the Board of Directors or the Committee regarding the Plan or
this Agreement shall be final, binding and conclusive.
6.7. Company to Reserve Shares. The Company shall at all times prior to the
cancellation of the Award reserve and keep available, either in its treasury or
out of its authorized but unissued shares of Common Stock, the full number of
unvested restricted stock units subject to the Award from time to time.

 

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6.8. Agreement Subject to the Plan; Section 409A of the Code. This Agreement is
subject to the provisions of the Plan (including the adjustment provision set
forth in Section 12.4 thereof) and shall be interpreted in accordance therewith.
The Director hereby acknowledges receipt of a copy of the Plan. This Award is
intended to be exempt from Section 409A of the Internal Revenue Code of 1986, as
amended (the “Code”), as a “short-term deferral,” within the meaning of
regulations issued under Section 409A of the Code, and this Agreement shall be
interpreted and construed in accordance with such intent and in a manner that
avoids the imposition of taxes and other penalties under Section 409A of the
Code. The Company reserves the right to amend this Agreement to the extent it
determines in its sole discretion such amendment is necessary or appropriate to
comply with applicable law, including but not limited to Section 409A of the
Code. Notwithstanding the foregoing, under no circumstances shall the Company be
responsible for any taxes, penalties, interest or other losses or expenses
incurred by the Director due to any failure to comply with Section 409A of the
Code.
7. Miscellaneous Provisions.
7.1. Meaning of Certain Terms. As used herein, the term “vest” shall mean no
longer subject to forfeiture and all rights hereunder shall be deemed to be
vested.
7.2. Successors. This Agreement shall be binding upon and inure to the benefit
of any successor or successors of the Company and any person or persons who
shall, upon the death of the Director, acquire any rights hereunder in
accordance with this Agreement or the Plan.
7.3. Notices. All notices, requests or other communications provided for in this
Agreement shall be made in writing by (a) actual delivery to the party entitled
thereto, (b) mailing to the last known address of the party entitled thereto,
via certified or registered mail, return receipt requested or (c) telecopy with
confirmation of receipt. The notice, request or other communication shall be
deemed to be received, in the case of actual delivery, on the date of its actual
receipt by the party entitled thereto, in the case of mailing, on the tenth
calendar day following the date of such mailing, and in the case of telecopy, on
the date of confirmation of receipt; provided, however, that if a notice,
request or other communication is not received during regular business hours, it
shall be deemed to be received on the next succeeding business day of the
Company.
7.4. Governing Law. This Agreement and all determinations made and actions taken
pursuant hereto, to the extent not otherwise governed by the laws of the United
States, shall be governed by the laws of the State of Delaware and construed in
accordance therewith without giving effect to conflicts of laws principles.
7.5 Reports Filed with the Securities and Exchange Commission. The Company files
periodic and current reports and proxy statements with the Securities and
Exchange Commission (“SEC”). These documents are available, free of charge, on
the website of the SEC (www.sec.gov) and on the Company’s website (www.sxc.com,
under Investor Relations/ Regulatory Filings), as soon as reasonably practicable
after the material is filed with, or furnished to, the SEC. Any of these
documents are available to the Director in paper format, without charge, upon
written or oral request to the Company’s Investor Relations Department located
at 2441 Warrenville Road, Suite 610, Lisle, Illinois 60532, U.S.A., phone number
(800) 282-3232.

 

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7.6. Counterparts. This Agreement may be executed in two counterparts each of
which shall be deemed an original and both of which together shall constitute
one and the same instrument.

         
 
  SXC HEALTH SOLUTIONS CORP.    
 
       
 
 
 
By:    

     
Accepted this                      day of
                    , 200_
   
 
   
 
Director
   

 

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Appendix A
to SXC Health Solutions Corp.
Restricted Stock Unit Award
Agreement for Directors
For purposes of this Agreement “Change in Control” shall mean:
(1) the acquisition by any individual, entity or group (a “Person”), including
any “person” within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), of beneficial
ownership within the meaning of Rule 13d-3 promulgated under the Exchange Act,
of more than 50% of either (i) the then outstanding shares of common stock of
the Company (the “Outstanding Company Common Stock”) or (ii) the combined voting
power of the then outstanding securities of the Company entitled to vote
generally in the election of directors (the “Outstanding Company Voting
Securities”); provided, however, that the following acquisitions shall not
constitute a Change in Control: (A) any acquisition directly from the Company
(excluding any acquisition resulting from the exercise of a conversion or
exchange privilege in respect of outstanding convertible or exchangeable
securities unless such outstanding convertible or exchangeable securities were
acquired directly from the Company), (B) any acquisition by the Company, (C) any
acquisition by an Director benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the Company or
(D) any acquisition by any corporation pursuant to a reorganization, merger or
consolidation involving the Company, if, immediately after such reorganization,
merger or consolidation, each of the conditions described in clauses (i),
(ii) and (iii) of subsection (3) of this Appendix A shall be satisfied; and
provided further that, for purposes of clause (B), if any Person (other than the
Company or any Director benefit plan (or related trust) sponsored or maintained
by the Company or any corporation controlled by the Company) shall become the
beneficial owner of more than 50% of the Outstanding Company Common Stock or
more than 50% of the Outstanding Company Voting Securities by reason of an
acquisition by the Company and such Person shall, after such acquisition by the
Company, become the beneficial owner of any additional shares of the Outstanding
Company Common Stock or any additional Outstanding Company Voting Securities and
such beneficial ownership is publicly announced, such additional beneficial
ownership shall constitute a Change in Control;
(2) individuals who, as of the date hereof, constitute the Board (the “Incumbent
Board”) cease for any reason to constitute at least a majority of such Board;
provided, however, that any individual who becomes a director of the Company
subsequent to the date hereof whose election, or nomination for election by the
Company’s shareholders, was approved by the vote of at least a majority of the
directors then comprising the Incumbent Board shall be deemed to have been a
member of the Incumbent Board; and provided further, that no individual who was
initially elected as a director of the Company as a result of an actual or
threatened solicitation by a Person other than the Board for the purpose of
opposing a solicitation by any other Person with respect to the election or
removal of directors or any other actual or threatened solicitation of proxies
or consents by or on behalf of any Person other than the Board shall be deemed
to have been a member of the Incumbent Board;

 

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(3) consummation of a reorganization, merger or consolidation unless, in any
such case, immediately after such reorganization, merger or consolidation,
(i) 50% or more of the then outstanding shares of common stock of the
corporation resulting from such reorganization, merger or consolidation and 50%
or more of the combined voting power of the then outstanding securities of such
corporation entitled to vote generally in the election of directors is then
beneficially owned, directly or indirectly, by all or substantially all of the
individuals or entities who were the beneficial owners, respectively, of the
Outstanding Company Common Stock and the Outstanding Company Voting Securities
immediately prior to such reorganization, merger or consolidation and in
substantially the same proportions relative to each other as their ownership,
immediately prior to such reorganization, merger or consolidation, of the
Outstanding Company Common Stock and the Outstanding Company Voting Securities,
as the case may be, (ii) no Person (other than the Company, any Director benefit
plan (or related trust) sponsored or maintained by the Company or the
corporation resulting from such reorganization, merger or consolidation (or any
corporation controlled by the Company) and any Person which beneficially owned,
immediately prior to such reorganization, merger or consolidation, directly or
indirectly, more than 50% of the Outstanding Company Common Stock or the
Outstanding Company Voting Securities, as the case may be) beneficially owns,
directly or indirectly, more than 50% of the then outstanding shares of common
stock of such corporation or more than 50% of the combined voting power of the
then outstanding securities of such corporation entitled to vote generally in
the election of directors and (iii) at least a majority of the members of the
board of directors of the corporation resulting from such reorganization, merger
or consolidation were members of the Incumbent Board at the time of the
execution of the initial agreement or action of the Board providing for such
reorganization, merger or consolidation; or
(4) consummation of (i) a plan of complete liquidation or dissolution of the
Company or (ii) the sale or other disposition of all or substantially all of the
assets of the Company other than to a corporation with respect to which,
immediately after such sale or other disposition, (A) 50% or more of the then
outstanding shares of common stock thereof and 50% or more of the combined
voting power of the then outstanding securities thereof entitled to vote
generally in the election of directors is then beneficially owned, directly or
indirectly, by all or substantially all of the individuals and entities who were
the beneficial owners, respectively, of the Outstanding Company Common Stock and
the Outstanding Company Voting Securities immediately prior to such sale or
other disposition and in substantially the same proportions relative to each
other as their ownership, immediately prior to such sale or other disposition,
of the Outstanding Company Common Stock and the Outstanding Company Voting
Securities, as the case may be, (B) no Person (other than the Company, any
Director benefit plan (or related trust) sponsored or maintained by the Company
or such corporation (or any corporation controlled by the Company) and any
Person which beneficially owned, immediately prior to such sale or other
disposition, directly or indirectly, more than 50% of the Outstanding Company
Common Stock or the Outstanding Company Voting Securities, as the case may be)
beneficially owns, directly or indirectly, more than 50% of the then outstanding
shares of common stock thereof or more than 50% of the combined voting power of
the then outstanding securities thereof entitled to vote generally in the
election of directors and (C) at least a majority of the members of the board of
directors thereof were members of the Incumbent Board at the time of the
execution of the initial agreement or action of the Board providing for such
sale or other disposition.

 

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SXC HEALTH SOLUTIONS CORP.
Long-Term Incentive Plan
BENEFICIARY DESIGNATION FORM
You may designate a primary beneficiary and a secondary beneficiary. You can
name more than one person as a primary or secondary beneficiary. For example,
you may wish to name your spouse as primary beneficiary and your children as
secondary beneficiaries. Your secondary beneficiary(ies) will receive nothing if
any of your primary beneficiaries survive you. All primary beneficiaries will
share equally unless you indicate otherwise. The same rule applies for secondary
beneficiaries.
Designate Your Beneficiary(ies):

             
 
  Primary Beneficiary(ies):        
 
     
 
             
 
                     
 
           
 
  Secondary Beneficiary(ies):        
 
     
 
             
 
                     
 
           

I certify that my designation of beneficiary set forth above is my free act and
deed.

         
 
Name of Director
 
 
Director’s Signature    
(Please Print)
       
 
       
 
 
 
Date    

 

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