Exhibit 10.1

 

 

Name:

[●]

Number of Restricted Stock Units:

[●]

Date of Grant:

[●]

 

 

The Michaels Companies, Inc.
2014 Omnibus Long-Term Incentive Plan

Restricted Stock Unit Agreement

This agreement (this “Agreement”) evidences the grant of restricted stock units
(the “Restricted Stock Units”) by The Michaels Companies, Inc. (the “Company”)
to the individual named above (the “Grantee”), pursuant to and subject to the
terms of The Michaels Companies, Inc. 2014 Omnibus Long-Term Incentive Plan (as
amended from time to time, the “Plan”), which is incorporated herein by
reference.

1. Grant of Restricted Stock Units.  The Company hereby grants to the Grantee on
the date of grant set forth above (the “Date of Grant”) an award (the “Award”)
consisting of the right to receive, on the terms provided herein and in the
Plan, one share of Stock with respect to each Restricted Stock Unit forming part
of the Award, in each case, subject to adjustment pursuant to Section 7(b) of
the Plan in respect of transactions occurring after the date hereof.

2. Meaning of Certain Terms.  Each initially capitalized term used but not
separately defined herein has the meaning assigned to such term in the
Plan.  The following terms have the following meanings:

(a)

“Change of Control” means the occurrence of any of the following: (i) any
consolidation or merger of the Company with or into any other corporation or
other Person, or any other corporate reorganization or transaction (including
the acquisition of capital stock of the Company), whether or not the Company is
a party thereto, in which the stockholders of the Company immediately prior to
such consolidation, merger, reorganization or transaction, own capital stock
either (A) representing directly, or indirectly through one or more entities,
less than fifty percent (50%) of the economic interests in or voting power of
the Company or other surviving entity immediately after such consolidation,
merger, reorganization or transaction or (B) that does not directly, or
indirectly through one or more entities, have the power to elect a majority of
the entire board of directors of the Company or other surviving entity
immediately after such consolidation, merger, reorganization or transaction;
(ii) any stock sale or other transaction or series of related transactions,
whether or not the Company is a party thereto, after giving effect to which in
excess of fifty percent (50%) of the Company’s voting power is owned directly,
or indirectly through one or more entities, by any Person and its “affiliates”
or “associates” (as such terms are defined in the rules adopted by the
Securities and Exchange Commission under the

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Securities Exchange Act of 1934, as in effect from time to time), other than the
Investors and their respective affiliated funds, excluding, in any case referred
to in clause (i) or (ii) an initial public offering or any bona fide primary or
secondary public offering following the occurrence of an initial public
offering; or (iii) a sale, lease or other disposition of all or substantially
all of the assets of the Company.

(b)

“Investors” means Bain Capital Partners, LLC and The Blackstone Group L.P.

(c)

“Person” means any individual, partnership, corporation, company, association,
trust, joint venture, limited liability company, unincorporated organization,
entity or division, or any government, governmental department or agency or
political subdivision thereof.

3. Vesting.  The term “vest” as used herein with respect to any Restricted Stock
Unit means the lapsing of the restrictions described herein with respect to such
Restricted Stock Unit.  Unless earlier terminated, forfeited, relinquished or
expired, the Award shall vest as follows, provided in each case that the Grantee
has remained in continuous Employment from the Date of Grant through the
applicable vesting date:

[INSERT VESTING CRITERIA].

In the event (i) the Restricted Stock Units (or any portion thereof) are
outstanding as of immediately prior to a Change of Control and the Administrator
provides for the assumption or continuation of, or the substitution of a
substantially equivalent award for, the Restricted Stock Units (or any portion
thereof) in accordance with Section 7(a)(i) of the Plan (the “Rollover Award”)
and (ii) the Grantee’s Employment is terminated by the Company (or its
successor) without Cause within the twelve (12) months following the Change of
Control, the Rollover Award to the extent still outstanding will vest in full on
the date of the termination of the Grantee’s Employment.  For the avoidance of
doubt, if the Administrator does not provide for such assumption, continuation,
or substitution in connection with a Change of Control, then the treatment of
the Restricted Stock Units in such Change of Control will be as provided for by
the Administrator in its sole discretion pursuant to Section 7(a)(2) through
Section 7(a)(5) of the Plan.

4. Forfeiture Risk.  If the Grantee’s Employment ceases for any reason,
including death, any then outstanding and unvested Restricted Stock Units
acquired by the Grantee hereunder shall be automatically and immediately
forfeited, subject to Section 3(b) above.

5. Delivery of Stock.  The Company shall deliver to the Grantee as soon as
practicable upon the vesting of the Restricted Stock Units (or any portion
thereof), but in all events no later than thirty (30) days following the date on
which such Restricted Stock

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Units vest, one share of Stock with respect to each such vested Restricted Stock
Unit, subject to the terms of the Plan and this Agreement.

6. Dividends, etc.  The Grantee shall have the rights of a shareholder with
respect to a share of Stock subject to the Award only at such time, if any, as
such share is actually delivered under the Award.  Without limiting the
generality of the foregoing and for the avoidance of doubt, the Grantee shall
not be entitled to vote any share of Stock subject to the Award or to receive or
be credited with any dividend or other distribution declared and payable on any
such share unless such share has been actually delivered hereunder and is held
by the Grantee on the record date for such vote or dividend (or other
distribution), as the case may be.

7. Nontransferability.  Neither the Award nor the Restricted Stock Units may be
transferred.

8. Certain Tax Matters. 

(a)

The Grantee expressly acknowledges and agrees that the Grantee’s rights
hereunder, including the right to be issued shares of Stock upon the vesting of
the Restricted Stock Units (or any portion thereof), are subject to the
Grantee’s promptly paying, or in respect of any later requirement of withholding
being liable promptly to pay at such time as such withholdings are due, to the
Company in cash (or by such other means as may be acceptable to the
Administrator in its discretion) all taxes required to be withheld, if any.  No
shares of Stock will be required to be transferred pursuant to the vesting of
the Restricted Stock Units (or any portion thereof) unless and until the Grantee
or the person then holding the Award has remitted to the Company an amount in
cash sufficient to satisfy any federal, state, or local requirements with
respect to tax withholdings then due and has committed (and by accepting the
Award the Grantee shall be deemed to have committed) to pay in cash all tax
withholdings required at any later time in respect of the transfer of such
shares, or has made other arrangements satisfactory to the Administrator with
respect to such taxes.  The Grantee also authorizes the Company and its
subsidiaries to withhold such amounts from any amounts otherwise owed to the
Grantee, but nothing in this sentence shall be construed as relieving the
Grantee of any liability for satisfying his or her obligations under the
preceding provisions of this Section.

(b)

The Grantee expressly acknowledges that because the Award consists of an
unfunded and unsecured promise by the Company to deliver Stock in the future,
subject to the terms hereof, it is not possible to make a so-called “83(b)
election” with respect to the Award.

 

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9. Forfeiture/Recovery of Compensation.  By accepting the Award the Grantee
expressly acknowledges and agrees that his or her rights, and those of any
permitted transferee, under the Award or to any Stock received following the
vesting of the Award or proceeds from the disposition thereof, are subject to
Section 6(a)(5) of the Plan (including any successor provision) and Section 10
of this Agreement.  Nothing in the preceding sentence shall be construed as
limiting the general application of Section 13 of this Agreement.

10. Non-Competition/Non-Solicitation.  The Grantee hereby acknowledges that the
Company and its Affiliates have invested and continue to invest considerable
resources in developing Company Information (as defined below) and trade
secrets, and in establishing and maintaining relationships with customers,
employees, and vendors.  The Grantee hereby further acknowledges that the Award
is being furnished to the Grantee as good and valuable consideration, among
other consideration, in exchange for the below covenants, which are necessary to
protect the Company Information, trade secrets, and goodwill of the Company and
its Affiliates:

(a)

Non-Competition.  The Grantee covenants and agrees that during the Grantee’s
Employment and for a period of twelve (12) months (and such period shall be
tolled on a day-to-day basis for each day during which the Grantee participates
in any activity in violation of the restrictions set forth in this Section
10(a)) following the termination of the Grantee’s Employment, whether such
termination occurs at the insistence of the Company or its Affiliates or the
Grantee (for whatever reason), the Grantee will not, directly or indirectly,
alone or in association with others, anywhere in the Territory (as defined
below), own, manage, operate, control or participate in the ownership,
management, operation or control of, or be connected as an officer, employee,
investor, principal, joint venturer, shareholder, partner, director, consultant,
agent or otherwise with, or have any financial interest (through stock or other
equity ownership, investment of capital, the lending of money or otherwise) in,
any business, venture or activity that directly or indirectly competes, or is in
planning, or has undertaken any preparation, to compete, with the Business of
the Company or any of its Immediate Affiliates (any Person who engages in any
such business venture or activity, a “Competitor”), except that nothing
contained in this Section 10(a) shall prevent the Grantee’s wholly passive
ownership of two percent (2%) or less of the equity securities of any Competitor
that is a publicly-traded company.  For purposes of this Section 10(a), the
“Business of the Company or any of its Immediate Affiliates” is that of arts and
crafts, or framing specialty retailer or wholesaler providing materials, ideas
and education for creative activities, or framing, as well as any other business
that the Company or any of its Immediate Affiliates conducts or is actively
planning to conduct at any time during the Grantee’s Employment, or with respect
to the Grantee’s obligations following the termination of the Grantee’s
Employment the twelve (12) months immediately preceding the termination of the
Grantee’s Employment; provided, that the term

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“Competitor” shall not include any business, venture or activity whose gross
receipts derived from the retail or wholesale sale of arts and crafts, or
framing products and services (aggregated with the gross receipts derived from
the retail and wholesale sale of such products or any related business, venture
or activity) are less than ten percent (10%) of the aggregate gross receipts of
such businesses, ventures or activities. For purposes of this Section 10(a), the
“Territory” is comprised of those states within the United States, those
provinces of Canada, and any other geographic area in which the Company or any
of its Immediate Affiliates was doing business or actively planning to do
business at any time during the Grantee’s Employment, or with respect to the
Grantee’s obligations following his or her termination of Employment the twelve
(12) months immediately preceding the termination of the Grantee’s
Employment.   For purposes of this Section, “Immediate Affiliates” means those
Affiliates which are one of the following: (i) a direct or indirect subsidiary
of the Company, (ii) a parent to the Company or (iii) a direct or indirect
subsidiary of such a parent.

(b)

Non-Solicitation. The Grantee covenants and agrees that during the Grantee’s
Employment and for a period of twelve (12) months (and such period shall be
tolled on a day-to-day basis for each day during which the Grantee participates
in any activity in violation of the restrictions set forth in this Section
10(b)) after the termination of the Grantee’s Employment, whether such
termination occurs at the insistence of the Company or the Grantee (for whatever
reason), the Grantee shall not, and shall not assist any other Person to, (i)
hire or solicit for hire any employee of the Company or any of its Immediate
Affiliates or seek to persuade any employee of the Company or any of its
Immediate Affiliates to discontinue employment or (ii) solicit or encourage any
independent contractor providing services to the Company or any of its Immediate
Affiliates to terminate or diminish its relationship with them; provided,
however, that after termination of the Grantee’s Employment, these restrictions
shall apply only with respect to employees of, and independent contractors
providing services to, the Company or any of its Immediate Affiliates who were
such on the date that the Grantee’s Employment terminated or at any time during
the nine (9) months immediately preceding such termination date.

(c)

Goodwill and Company Information.  The Grantee acknowledges the importance to
the Company and its Affiliates of protecting their legitimate business
interests, including without limitation the valuable Company Information and
goodwill that they have developed or acquired at considerable expense.  The
Grantee acknowledges and agrees that in the course of the Grantee’s Employment,
the Grantee has acquired: (i) confidential information including without
limitation information received by the Company (or any of its Affiliates) from
third parties, under confidential conditions, (ii) other technical, product,
business, financial or

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development information from the Company (or any of its Affiliates), the use or
disclosure of which reasonably might be construed to be contrary to the interest
of the Company (or any of its Affiliates), or (iii) any other proprietary
information or data, including but not limited to identities, responsibilities,
contact information, performance and/or compensation levels of employees, costs
and methods of doing business, systems, processes, computer hardware and
software, compilations of information, third-party IT service providers and
other Company or its Affiliates’ vendors, records, sales reports, sales
procedures, financial information, customer requirements and confidential
negotiated terms, pricing techniques, customer lists, price lists, information
about past, present, pending and/or planned Company or its Affiliates’
transactions not publically disclosed and other confidential information which
the Grantee may have acquired during the Grantee’s Employment (hereafter
collectively referred to as “Company Information”) which are owned by the
Company or  its Affiliates and regularly used in the operation of its business,
and as to which precautions are taken to prevent dissemination to persons other
than certain directors, officers and employees and if disclosed, would assist in
competition against the Company or any of its Affiliates.  The Grantee
understands and agrees that such Company Information was and will be disclosed
to the Grantee in confidence and for use only in performing work for the Company
or its Affiliates.  The Grantee understands and agrees that the Grantee: (x)
will keep such Company Information confidential at all times, (y) will not
disclose or communicate Company Information to any third party, and (z) will not
make use of Company Information on the Grantee’s own behalf, or on behalf of any
third party.  In view of the nature of the Grantee’s Employment and the nature
of Company Information the Grantee receives during the course of the Grantee’s
Employment, the Grantee agrees that any unauthorized disclosure to third parties
of Company Information would cause irreparable damage to the confidential or
trade secret status of Company Information. The Grantee further acknowledges and
agrees that the restrictions on his or her activities set forth above are
necessary to protect the goodwill, Company Information and other legitimate
interests of the Company and its Affiliates and that the Grantee’s acceptance of
these restrictions is a condition of receipt of the Award, to which the Grantee
would not otherwise be entitled, and the Award is good and sufficient
consideration to support the Grantee’s agreement to and compliance with these
covenants.

(d)

Remedies.  In the event of a breach or threatened breach by the Grantee of any
of the covenants contained in Section 10(a), 10(b) or 10(c):

(i) the Grantee hereby consents and agrees that (x) any unvested Restricted
Stock Units and (y) all shares of Stock held by the Grantee following the
vesting of the Restricted Stock Units shall be forfeited effective as of the
date of such breach or

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threatened breach, unless sooner terminated by operation of another term or
condition of this Agreement or the Plan;

(ii) the Grantee hereby consents and agrees that if the Grantee has sold any
shares of Stock upon or following the vesting of the Restricted Stock Units
within twelve (12) months prior to the date of such breach or threatened breach,
the Grantee shall pay to the Company the gross proceeds realized by the Grantee
in connection with such sale; and

(iii) the Grantee hereby consents and agrees that the Company shall be entitled
to seek, in addition to other available remedies, a temporary or permanent
injunction or other equitable relief against such breach or threatened breach
from any court of competent jurisdiction, without the necessity of showing any
actual damages or that money damages would not afford an adequate remedy, and
without the necessity of posting any bond or other security. The aforementioned
equitable relief shall be in addition to, not in lieu of, legal remedies,
monetary damages or other available forms of relief.

(e)

General.  The Grantee agrees that the above restrictive covenants are completely
severable and independent agreements supported by good and valuable
consideration and, as such, shall survive the termination of this Agreement for
whatever reason.  The Company and the Grantee agree that any invalidity or
unenforceability of any one or more of such restrictions on competition shall
not render invalid or unenforceable any remaining restrictive covenants. Should
a court of competent jurisdiction determine that the scope of any provision of
this Section 10 is too broad to be enforced as written, the Company and the
Grantee intend that the court reform the provision to such narrower scope as it
determines to be reasonable and enforceable.

11. Form S-8 Prospectus.  The Grantee acknowledges having received and reviewed
a copy of the prospectus required by Part I of Form S-8 relating to shares of
Stock that may be issued under the Plan. 

12. Governing Law.  Notwithstanding anything to the contrary in the Plan,
Section 10 of this Agreement shall be governed by and construed in accordance
with the laws of the State of Texas, without giving effect to any choice or
conflict of law provision or rule that would cause the application of the laws
of any other jurisdiction, except where preempted by federal law.  Both parties
hereby consent and submit to the jurisdiction of the state and federal courts in
Dallas County, Texas in all questions and controversies arising out of this
Agreement.

13. Acknowledgments.  By accepting the Award, the Grantee agrees to be bound by,
and agrees that the Award is, and the Restricted Stock Units are, subject in all

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respects to, the terms of the Plan.  The Grantee further acknowledges and agrees
that (a) the signature to this Agreement on behalf of the Company is an
electronic signature that will be treated as an original signature for all
purposes hereunder, and (b) such electronic signature will be binding against
the Company and will create a legally binding agreement when this Agreement is
countersigned by the Grantee.

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Executed as of the ___ day of [●],  [●].

 

 

Company:THE MICHAELS COMPANIES, INC.

 

 

 

By: ______________________________

Name:

Title:

 

 

Grantee:__________________________________

Name:

Address:

 

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