Exhibit 10.86

 

SELECT MEDICAL HOLDINGS CORPORATION

RESTRICTED STOCK AWARD AGREEMENT UNDER THE

2011 EQUITY INCENTIVE PLAN

 

This Restricted Stock Award Agreement (this “Agreement”) is made as of
October 30, 2013 (the “Effective Date”), between SELECT MEDICAL HOLDINGS
CORPORATION, a Delaware corporation (the “Company”), and THOMAS A. SCULLY, an
individual (the “Participant”).

 

WHEREAS, the Company has adopted the 2011 Equity Incentive Plan (the “Plan”),
all of the terms and provisions of which are incorporated herein by reference
and made a part hereof;

 

WHEREAS, the Participant serves as a member of the Board of Directors of the
Company;

 

WHEREAS, in order to provide an incentive to the Participant to serve as a
consultant under the that certain Consulting Agreement between the Company and
the Participant, dated of even date herewith (the “Consulting Agreement”), the
Company has approved and authorized the issuance of certain shares of the Common
Stock of the Company, par value $.001 per share (the “Stock”), to the
Participant, subject to the terms of the Plan and this Agreement; and

 

WHEREAS, all capitalized terms used but not defined herein shall have the
meanings set forth in the Plan.

 

NOW, THEREFORE, in consideration of the services to be rendered by the
Participant under the Consulting Agreement, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
Company and the Participant agree to the terms and conditions set forth herein.

 

1.                                      Award of Restricted Stock.  The Company
hereby awards and issues to the Participant, effective as of the date hereof,
100,000 shares of Stock (the “Restricted Stock”).

 

2.                                      Vesting Schedule. Subject to the further
provisions of this Agreement, and the Participant’s continued service under the
Consulting Agreement, 50% of the shares of Restricted Stock shall vest on
October 30, 2014 and 50% of the shares of Restricted Stock shall vest on
October 30, 2015.  The period beginning on the date hereof through and including
the vesting date for any shares of Restricted Stock shall be referred to herein
as the “Restricted Period” with respect to such shares of Restricted Stock.

 

3.                                      Transferability.  Shares of Restricted
Stock which have not vested may not be sold, assigned, transferred, pledged, or
otherwise disposed of under any circumstances during the applicable Restricted
Period, except that such shares may be transferred to a Permitted Transferee who
agrees in writing (in a form satisfactory to the Company and its counsel) to be
bound by this Agreement to the same extent as the Participant, and any such
transferred shares shall continue to be subject to forfeiture upon the
Participant’s termination of service under the Consulting Agreement as provided
herein.  The Restricted Stock shall not be subject to

 

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execution, attachment or similar process during the applicable Restricted
Period.  Upon any attempt to transfer, assign, pledge, or otherwise dispose of
the Restricted Stock during the applicable Restricted Period contrary to the
provisions of the Plan or this Agreement, or upon the levy of any attachment or
similar process upon the Restricted Stock during the applicable Restricted
Period, the Restricted Stock shall immediately be forfeited to the Company and
cease to be outstanding.

 

4.                                      Forfeiture of Restricted Stock.  All
unvested shares of Restricted Stock shall immediately be forfeited to the
Company and cease to be outstanding upon the termination of the Participant’s
service under the Consulting Agreement.  The Participant acknowledges that
neither the Participant nor the Participant’s estate will have any claim
whatsoever against the Company or any Subsidiary related to any forfeiture of
the Restricted Stock.

 

5.                                      Acceleration of Vesting Upon Change of
Control.  Upon a Change of Control all Restricted Periods shall terminate and
all outstanding shares of Restricted Stock shall be vested in full and all
limitations on such Restricted Stock set forth in this Agreement shall
automatically lapse.

 

6.                                      Plan Governing.  The Participant hereby
acknowledges receipt of a copy of the Plan and accepts and agrees to be bound by
all of the terms and conditions of the Plan as if set out verbatim in this
Agreement.  In the event of a conflict between the terms of the Plan and the
terms of this Agreement, the terms of the Plan shall control.

 

7.                                      Miscellaneous.  This Agreement may be
amended only by written agreement of the Participant and the Company and may be
amended without the consent of any other person.  The provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors, representatives, heirs, descendants,
distributees and permitted assigns.  This Agreement may be executed in any
number of counterparts, each of which shall be an original, with the same effect
as if the signatures thereto and hereto were upon the same instrument.

 

IN WITNESS WHEREOF, the parties have executed this Agreement effective as of the
Effective Date.

 

 

 

Company:

SELECT MEDICAL HOLDINGS CORPORATION

 

 

 

 

 

By:

/s/ Robert A. Ortenzio

 

 

Name:

Robert A. Ortenzio

 

 

Title:

Chief Executive Officer

 

 

 

 

 

 

 

 

 

Participant:

/s/ Thomas A. Scully

 

 

 

Thomas A. Scully

 

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