Exhibit 10.2
RESTRICTED STOCK AWARD AGREEMENT
UNDER THE HCC INSURANCE HOLDINGS, INC.
2008 FLEXIBLE INCENTIVE PLAN
     This Restricted Stock Award Agreement (this “Agreement”) is entered into
effective as of the date of grant set forth on the signature page below (the
“Grant Date”) by and between HCC Insurance Holdings, Inc., a Delaware
corporation (the “Company”), and the undersigned employee of the Company or its
Subsidiary (the “Employee”). Capitalized terms used herein and not otherwise
defined shall have the meaning specified in the HCC Insurance Holdings, Inc.
2008 Flexible Incentive Plan, as amended and restated and as further amended
(the “Plan”).
     WHEREAS, under the terms of the Plan the Committee may grant awards of
Restricted Stock to Participants in the Plan;
     WHEREAS, Employee is an eligible Participant in the Plan; and
     WHEREAS, the Committee has approved an award of Restricted Stock to
Employee on the terms and conditions hereof and subject to the restrictions set
forth herein as an incentive for Employee’s performance of services for the
Company and/or its Subsidiaries;
     NOW, THEREFORE, in consideration of the premises and the mutual covenants
herein contained and other good and valuable consideration, the parties hereto
agree as follows:
     1. Grant of Restricted Shares. As of the Grant Date, the Company hereby
grants and conveys to Employee the number of Shares of Restricted Stock
specified on the signature page of this Agreement (the “Restricted Shares”).
          (a) The Restricted Shares shall be subject to the terms of the Plan,
which terms are incorporated herein by this reference. Except to the extent
expressly provided by the Plan, in the event of any conflict between the terms
of this Agreement and those of the Plan, the terms of the Plan, including those
with respect to the powers of the Committee, shall prevail and be controlling.
          (b) The Restricted Shares shall be registered in Employee’s name as of
the Grant Date through a book entry credit in the records of the Company’s
transfer agent, but shall be restricted as described herein during the period
prior to the vesting of such shares in accordance with Section 3 (the
“Restriction Period”). During the Restriction Period, any certificates
representing the Restricted Shares shall carry a legend evidencing the
restrictions of this Agreement. The terms of any such legend shall be determined
by the Committee in its sole discretion.
          (c) If, from time to time during the Restriction Period, there is any
stock dividend, stock split, reorganization, recapitalization, merger, or other
event described in Section 14 of the Plan, any and all new, substituted,
additional, or other securities to which Employee is entitled by reason of his
ownership of the Restricted Shares shall be considered “Restricted Shares” for
purposes of this Agreement and shall be subject to the restrictions described in
Section 2 during the Restriction Period.

 

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          (d) Subject to the restrictions set forth in Section 2, Employee shall
have all the rights of a stockholder with respect to the Restricted Shares,
including any applicable voting and dividend rights.
     2. Restrictions.
          (a) During the Restriction Period, Employee shall not sell, transfer,
pledge, assign, alienate, hypothecate, or otherwise encumber or dispose of the
Restricted Shares other than by will or the laws of descent and distribution.
Any attempt to do so contrary to the foregoing shall be null and void.
          (b) If Employee terminates employment with the Company prior to the
end of the Restriction Period, the unvested Restricted Shares shall be forfeited
and returned to the Company without the payment of any consideration, and
Employee shall have no rights with respect to such forfeited shares. For
purposes of this Agreement, Employee shall be considered to be an employee of
the Company for so long as Employee is a common law employee of the Company or
any Subsidiary, and Employee’s employment relationship with an entity which was
a Subsidiary shall be deemed to have terminated as of the date on which such
entity ceased to be a Subsidiary (even if Employee does not experience a common
law termination of employment at such time).
     3. Vesting. The Restricted Shares granted hereunder shall fully vest, and
the restrictions imposed pursuant to Section 2 shall lapse immediately prior to
the first to occur of the following:
          (a) the fourth anniversary of the Grant Date;
          (b) the date of Employee’s death;
          (c) the date Employee terminates employment with the Company due to
Employee’s Disability;
          (d) the date Employee’s employment with the Company is involuntarily
terminated by the Company other than for “Cause” (as defined below). Employee’s
employment with the Company shall be considered involuntarily terminated by the
Company other than for cause if Employee is transferred to or employed by an
entity other than the Company or a Subsidiary in connection with a divestiture,
spinoff, outsourcing, or similar business transaction, even if Employee does not
experience a common law termination of employment in connection with such event
or transaction. For purposes of this Agreement and notwithstanding the terms of
any other agreement between Employee and the Company, the term “Cause” shall
mean (a) material dishonesty by Employee which is not the result of an
inadvertent or innocent mistake of Employee with respect to the Company or any
Subsidiary; (b) willful misfeasance or nonfeasance of duty by Employee; (c) a
material violation by Employee of any material term of his written employment
agreement (if any) with the Company or any Subsidiary as determined in the sole
discretion of the Company; or (d) conviction of Employee of any felony, any
crime involving moral turpitude, or any crime (other than a vehicular offense
not involving DUI or personal injury) which in some material fashion results in
the injury of the Company’s or any Subsidiary’s reputation, business, or
business relationships;
          (e) the date of a Change in Control of the Company; and

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          (f) the date on which the Restricted Shares are cancelled in exchange
for cash or property (other than securities which are considered Restricted
Shares pursuant to Section 1(c)) in connection with a merger or other business
transaction, reorganization, or event that is not a Change in Control.
     4. Delivery of Share Certificates; Compliance with Securities Laws. Upon
the vesting of any Restricted Shares granted hereunder, the Company shall direct
its transfer agent to record such shares as unrestricted or to deliver to
Employee certificates evidencing such Restricted Shares. If certificates are
delivered to Employee, such certificates shall not bear the legend referenced in
Section 1(b). Nothing herein shall obligate the Company to register the
Restricted Shares pursuant to any applicable securities law or to take any other
affirmative action in order to cause the issuance or transfer of the Restricted
Shares to comply with any law or regulation of any governmental authority.
     5. Tax Consequences; Tax Withholding.
          (a) Employee shall be responsible for his own tax liability that
arises as the result of this Agreement. Employee acknowledges and understands
that he may make an election under section 83(b) of the Code within 30 days
after the Grant Date.
          (b) Employee shall pay to the Company, or make arrangements
satisfactory to the Company regarding payment to the Company of, the aggregate
amount of any federal, state, and local income, employment, Social Security,
Medicare, and other taxes that the Company is required to withhold in connection
with the Restricted Shares. The Company shall have the right to deduct any such
taxes from any amounts paid to Employee by the Company or any Subsidiary.
     6. Notices. Every notice or other communication relating to this Agreement
shall be in writing, and shall be mailed to or delivered to the party for whom
it is intended at such address as may from time to time be designated by him in
a notice mailed or delivered to the other party. Unless and until some other
address is so designated, all notices or communications by Employee to the
Company shall be mailed or delivered to the Company, care of its General
Counsel, at 13403 Northwest Freeway, Houston, Texas 77040-6094, and all notices
or communications by the Company to Employee shall be mailed or delivered to
Employee’s address specified on the signature page to this Agreement.
     7. Amendments and Waivers. Any provision of this Agreement may be amended
or waived if, and only if, such amendment or waiver is in writing and is signed,
in the case of an amendment, by the Company and Employee, or in the case of a
waiver, by the party against whom the waiver is to be effective. No failure or
delay by any party in exercising any right or privilege hereunder shall operate
as a waiver thereof, nor shall any single or partial exercise thereof preclude
any other or further exercise thereof or the exercise of any other right, power,
or privilege. To the maximum extent permitted by law, (a) no waiver that may be
given by a party shall be applicable except in the specific instance for which
it was given and (b) no notice to or demand on one party shall be deemed to be a
waiver of any obligation of such party or the right of the party giving such
notice or demand to take further action without notice or demand.
     8. No Right to Continued Service. This Agreement does not confer upon
Employee any right to remain in the employ of the Company or any Subsidiary, nor
shall it interfere in any

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way with the right of the Company and its Subsidiaries to terminate or change
the conditions of his employment at any time.
     9. Successors and Assigns; Binding Effect. This Agreement, and the rights
and obligations of the parties hereunder, may not be assigned by any party
hereto other than by will or the laws of descent and distribution. All of the
terms and provisions of this Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective executors, heirs, personal
representatives, successors, and permitted assigns.
     10. Entire Agreement. This Agreement, along with the Plan and any other
written agreement between the parties specifically incorporated herein by
reference, sets forth the entire understanding of the parties hereto with
respect to the grant of the Restricted Shares to Employee. Any and all previous
agreements and understandings between or among the parties regarding the subject
matter hereof, whether written or oral, are superseded by this Agreement.
     11. Interpretation. The meaning assigned to each term defined herein shall
be equally applicable to both the singular and the plural forms of such term and
vice versa, and words denoting either gender shall include both genders as the
context requires. Where a word or phrase is defined herein, each of its other
grammatical forms shall have a corresponding meaning. The terms “hereof,”
“herein” and “herewith” and words of similar import shall, unless otherwise
stated, be construed to refer to this Agreement as a whole and not to any
particular provision of this Agreement. When a reference is made in this
Agreement to a Section, such reference is to a Section of this Agreement unless
otherwise specified. The word “include”, “includes”, and “including” when used
in this Agreement shall be deemed to be followed by the words “without
limitation”, unless otherwise specified. A reference to any party to this
Agreement or any other agreement or document shall include such party’s
predecessors, successors, and permitted assigns. Reference to any law means such
law as amended, modified, codified, replaced, or reenacted, and all rules and
regulations promulgated thereunder. All captions contained in this Agreement are
for convenience of reference only, do not form a part of this Agreement, and
shall not affect in any way the meaning or interpretation of this Agreement. The
parties have participated jointly in the negotiation and drafting of this
Agreement; therefore any rule of construction or interpretation otherwise
requiring this Agreement to be construed or interpreted against any party by
virtue of the authorship of this Agreement shall not apply to the construction
and interpretation hereof.
     12. Severability. Any provision of this Agreement which is invalid or
unenforceable in any applicable jurisdiction shall be ineffective to the extent
of such invalidity or unenforceability without invalidating or rendering
unenforceable the remaining provisions hereof, and any such invalidity or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
     13. Governing Law and Venue. This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas, without regard to
the conflicts of laws principles thereof. To the maximum extent practicable this
Agreement calls for performance and shall be performable at the offices of the
Company in Houston, Harris County, Texas and venue for any dispute arising
hereunder shall lie exclusively in the state and/or federal courts of Harris
County, Texas and the Southern District of Texas, Houston Division,
respectively.

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     14. Signature in Counterparts. This Agreement may be signed in
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument. The parties agree
that the delivery of this Agreement may be effected by means of an exchange of
facsimile signatures which shall be deemed original signatures thereof.
     15. EXPIRATION OF AGREEMENT. IF THIS AGREEMENT IS NOT SIGNED AND RETURNED
TO THE COMPANY WITHIN 30 DAYS AFTER THE GRANT DATE, THIS AGREEMENT AND THE
RESTRICTED STOCK AWARD PROVIDED FOR HEREIN SHALL BE NULL AND VOID.
[SIGNATURE PAGE TO RESTRICTED STOCK AWARD AGREEMENT]

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