Exhibit 10.1 – Form of Restricted Stock Agreement for executive officers

 

INTERFACE, INC.

RESTRICTED STOCK AGREEMENT

 

This Restricted Stock Agreement (this “Agreement”) is entered into as of the ___
day of _____________, 20__, by and between Interface, Inc. (the “Company”) and
_______________ (“Grantee”).

 

W I T N E S S E T H:

 

WHEREAS, the Company has adopted the Interface, Inc. Omnibus Stock Incentive
Plan (the “Plan”) which is administered by a committee appointed by the
Company's Board of Directors (the “Committee”); and

 

WHEREAS, the Committee has granted to Grantee an award of Restricted Shares
under the terms of the Plan (the “Award”) to encourage Grantee’s continued
loyalty and diligence; and

 

WHEREAS, to comply with the terms of the Plan and to further the interests of
the Company and Grantee, the parties hereto have set forth the terms of the
Award in writing in this Agreement.

 

NOW, THEREFORE, for and in consideration of the mutual promises herein
contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:

 

1.             Plan Provisions.

 

In addition to the terms and conditions set forth herein, the Award is subject
to and governed by the terms and conditions set forth in the Plan, which are
hereby incorporated herein by reference. Any terms used herein with an initial
capital letter shall have the same meaning as provided in the Plan, unless
otherwise specified herein. In the event of any conflict between the provisions
of this Agreement and the Plan, the Plan shall control.

 

2.             Stock Award.

 

Effective on __________ __, 20__ (the “Grant Date”), and subject to the
restrictions and other conditions set forth herein, the Committee granted to
Grantee an Award of _____ Shares of common stock, $.10 par value per share, of
the Company. Such Shares granted are hereinafter sometimes referred to as the
“Restricted Shares.” The Fair Market Value of each Restricted Share awarded on
the Grant Date was $_____.

 

3.             Vesting Restrictions.

 

(a)           General. All or a portion (as applicable) of the Restricted Shares
will vest and no longer be subject to forfeiture if one of several criteria is
satisfied. As described below, these criteria are based on Grantee’s tenure of
employment, the termination of Grantee’s employment after occurrence of a Change
in Control (as defined in subsection (c) hereof), and/or certain other events
resulting in termination of Grantee’s employment with the Company.

 

 

 
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(b)           Tenure of Employment. If Grantee remains continuously employed by
the Company or any of its Subsidiaries until _____________, Grantee shall become
fully vested in the Restricted Shares.

 

(c)           Termination After a Change in Control. If within 24 months
following the occurrence of a Change in Control (as defined below) Grantee’s
employment with the Company and its Subsidiaries terminates as a result of
(i) involuntary termination at the request of the Company (or the Subsidiary
that is Grantee’s employer) for any reason other than Cause (as defined in
Section 4 below), or (ii) a voluntary termination by Grantee with Good Reason
(as defined below), any Restricted Shares granted hereunder that have not yet
vested or been forfeited will become fully vested on the date of Grantee’s
termination of employment. For purposes hereof, “Change in Control” shall mean
the earliest to occur of:

 

(i)     the acquisition by any “person”, entity, or “group” of “beneficial
ownership” (as such terms are used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934, and rules promulgated thereunder) of more than 30 percent
of the outstanding capital stock entitled to vote for the election of directors
(“Voting Stock”) of (A) the Company, or (B) any corporation which is the
surviving or resulting corporation, or the transferee corporation, in a
transaction described in clause (ii)(A) or (ii)(B) immediately below;

 

(ii)     the effective time of (A) a merger, consolidation or other business
combination of the Company with one or more corporations as a result of which
the holders of the outstanding Voting Stock of the Company immediately prior to
such merger or consolidation hold less than 51 percent of the Voting Stock of
the surviving or resulting corporation, or (B) a transfer of all or
substantially all of the property or assets of the Company other than to an
entity of which the Company owns at least 51 percent of the Voting Stock, or (C)
a plan of complete liquidation of the Company; and

 

(iii)     the election to the Board of Directors of the Company, without the
recommendation or approval of the incumbent Board of Directors of the Company,
of the lesser of (A) four directors, or (B) directors constituting a majority of
the number of directors of the Company then in office.

 

“Good Reason” shall mean, following a Change in Control, (i) a material
reduction in Grantee’s authorities, duties or responsibilities, (ii) a material
reduction in Grantee’s base compensation or bonus opportunity as in effect
immediately prior to the Change in Control, (iii) a material reduction in
Grantee’s benefits, other than a reduction affecting substantially all similarly
situated employees, (iv) a material reduction in any budget over which the
Grantee has authority, or (v) a Company-required relocation of more than 30
miles of the Grantee’s principal place of employment. An event described in
clause (i), (ii) or (iii) shall constitute Good Reason only if the Grantee
notifies the Company within 20 days of the occurrence of the event and the
Company fails to take appropriate action to cure such event within 20 days after
receiving such notice.

 

 

 
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(d)     Disability, Death, or Involuntary Termination without Cause. Upon the
date that Grantee’s employment with the Company and its Subsidiaries terminates
as a result of (i) Grantee’s Disability (as defined below), (ii) Grantee’s
death, or (iii) an involuntary termination at the request of the Company (or the
Subsidiary that is Grantee’s employer) for any reason other than Cause (as
defined in Section 4 below), all or a portion of the Restricted Shares that have
not yet vested or been forfeited will do so on such date, and Grantee thereupon
will become vested in such Restricted Shares; provided, however, that in the
event of an involuntary termination for any reason other than Cause, in order to
vest in such Restricted Shares Grantee must sign a release of claims and
acknowledgment in the form required by the Company. The amount of Restricted
Shares that shall vest will be equal to the product of (x) the total number of
Restricted Shares granted hereunder that have not yet vested, and (y) a
fraction, the numerator of which is the number of full and partial 12-month
periods that have elapsed since the Grant Date (with any partial 12-month period
treated as a whole 12-month period), and the denominator of which is __________.
Any Restricted Shares that do not vest as described herein shall be immediately
forfeited, and Grantee (or Grantee’s heirs) shall not have any rights in such
Restricted Shares. For purposes hereof, the term “Disability” shall mean
Grantee’s inability, as a result of physical or mental incapacity, to
substantially perform Grantee’s duties for the Company and its Subsidiaries on a
full-time basis for a continuous period of six months. The Committee, in its
sole discretion, shall make all determinations as to whether or not Grantee has
incurred a Disability, and the Committee’s determination shall be final and
binding.

 

4.             Forfeiture Upon Resignation or Termination for Cause.

 

If Grantee voluntarily resigns from employment with the Company and all of its
Subsidiaries, or if the Company or the Subsidiary that is Grantee’s employer
terminates Grantee’s employment for Cause (as defined below), any Restricted
Shares that are not then vested under any provision of Section 3 shall be
immediately forfeited, and Grantee shall have no rights in such Restricted
Shares. For purposes hereof, the term “Cause” shall mean the reason for
termination of Grantee’s employment is (A) Grantee’s fraud, dishonesty, gross
negligence or willful misconduct, with respect to business affairs of the
Company or its Subsidiaries, (B) Grantee’s refusal or repeated failure to follow
the established lawful policies of the Company or its Subsidiaries applicable to
persons occupying the same or similar positions, or (C) Grantee’s conviction of
a felony or other crime involving moral turpitude.

 

5.             Delivery of Shares.

 

Within a reasonable time after the date hereof, the Company shall cause the
Restricted Shares to be registered in the name of Grantee, subject to the risk
of forfeiture set forth in Sections 3 and 4 hereof. Grantee may not sell,
assign, transfer or pledge any Restricted Shares prior to the date on which the
possibility of forfeiture with respect to such Shares has lapsed. During the
period that any Restricted Shares remain subject to a risk of forfeiture under
Sections 3 and 4 hereof, the Company may retain possession of any certificate
representing such Shares as a means of enforcing such restrictions.

 

 

 
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6.             Acknowledgment of Grantee.

 

Grantee acknowledges that certain restrictions under state, federal or foreign
securities laws may apply with respect to the Restricted Shares granted pursuant
to the Award. Grantee further acknowledges that, to the extent Grantee is an
“affiliate” of the Company (as that term is defined by the Securities Act of
1933), the Restricted Shares granted as a result of the Award are subject to
certain trading restrictions under applicable securities laws (including,
particularly, Rule 144 under the Securities Act). Grantee hereby agrees to
execute such documents and take such actions as the Company may reasonably
require with respect to state, federal and foreign securities laws applicable to
the Company and any restrictions on the resale of such Shares which may pertain
under such laws. The Company has registered (or intends to register) the
securities represented by the Restricted Shares; however, in the event such
registration at any time is ineffective or any special rules apply, such
securities may be sold or transferred only in accordance with the Plan and
pursuant to additional, effective securities laws registrations or in a
transaction that is exempt from such registration requirements. If appropriate
under the circumstances, the certificate(s) evidencing the Restricted Shares
shall bear a restrictive legend indicating that such shares have not been
registered under applicable securities laws.

 

7.             Execution of Agreement.

 

Grantee shall execute this Agreement within 30 days after receipt of same, and
promptly return an executed copy to the Secretary of the Company.

 

8.             Withholding.

 

Grantee shall pay the Company an amount equal to the sum of all applicable
employment taxes that the Company or any Subsidiary is required to withhold at
any time in connection with the operation of this Agreement. In the absence of
prior arrangements satisfactory to the Company for payment of all such taxes
required to be withheld, the Company shall withhold a portion of the Restricted
Shares then vested under this Agreement in payment of such taxes, except to the
extent such withholding of Shares is prohibited by any covenants governing the
Company’s debt as in effect from time to time.

 

9.             Miscellaneous.

 

(a)           Employment Rights. The granting of the Award and the execution of
this Agreement shall not afford Grantee any rights to similar grants in future
years or any right to be retained in the employ or service of the Company or any
of its Subsidiaries, nor shall it interfere in any way with the right of the
Company or any such Subsidiary to terminate Grantee's employment or services at
any time, with or without cause, or the right of Grantee to terminate Grantee’s
employment or services at any time.

 

(b)           Shareholder Rights. While the Restricted Shares remain subject to
forfeiture under Sections 3 and 4 hereof, Grantee shall have all of the rights
of a shareholder of the Company, including the right to vote the Restricted
Shares and to receive any cash dividends.

 

 

 
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(c)           Severability. If any term, provision, covenant or restriction
contained in this Agreement is held by a court or a governmental agency of
competent jurisdiction to be invalid, void or unenforceable, the remainder of
the terms, provisions, covenants and restrictions contained in this Agreement
shall continue in full force and effect, and shall in no way be affected,
impaired or invalidated.

 

(d)           Controlling Law. This Agreement is being made in the State of
Georgia (USA) and shall be construed and enforced in accordance with the laws of
that state. Grantee hereby consents to the exclusive jurisdiction of the
Superior Court of Cobb County, Georgia, and the U.S. District Court in Atlanta,
Georgia, and hereby waives any objection Grantee might otherwise have to
jurisdiction and venue in such courts, in the event either court is requested to
resolve a dispute between the parties with respect to this Agreement.

 

(e)           Construction. This Agreement contains the entire understanding
between the parties and supersedes any prior understanding and agreements
between them with respect to the subject matter hereof. There are no
representations, agreements, arrangements or understandings, oral or written,
between the parties hereto relating to the subject matter hereof which are not
fully expressed herein.

 

(f)            Binding Effect. This Agreement shall inure to the benefit of, and
be binding upon, the Company and its successors and assigns, and Grantee and
Grantee’s heirs and personal representatives. Any business entity or person
succeeding to all or substantially all of the business of the Company by stock
purchase, merger, consolidation, purchase of assets, or otherwise shall be bound
by and shall adopt and assume this Agreement, and the Company shall obtain the
assumption of this Agreement by such successor.

 

(g)           Headings. Section and other headings contained in this Agreement
are included for reference purposes only and are in no way intended to define or
limit the scope, extent or intent of this Agreement or any provision hereof.

 

IN WITNESS WHEREOF, the individual party hereto has executed this Agreement, and
the corporate party has caused this Agreement to be executed by a duly
authorized representative, as of the date first set forth above.

 

INTERFACE, INC.

 

By:                                                                                                  

[name]

ex10-1.htm

 

GRANTEE 

 

__________________________________________

[name]

 

 

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