Exhibit 10.2

 

RESTRICTED STOCK UNIT AND STOCK OPTION AGREEMENT

THIS RESTRICTED STOCK UNIT AND STOCK OPTION AGREEMENT (the “Agreement”), made
effective as of February 28, 2020 (the “Date of Grant”), between HELIOS
TECHNOLOGIES, INC, a Florida corporation (the “Corporation”), and __________
(“Participant”).

WITNESSETH:

WHEREAS, Participant is an employee of the Corporation and/or a subsidiary of
the Corporation (“Subsidiary”);

WHEREAS, the Corporation has adopted the Helios Technologies 2019 Equity
Incentive Plan (the “Plan”) in order to provide its officers, employees and
directors with incentives to achieve long-term corporate objectives; which was
adopted by the Board of Directors on March 8, 2019 and approved by the
shareholders of the Corporation at the Corporation’s June 13, 2019 Annual
Meeting; and

WHEREAS, the Compensation Committee of the Corporation’s Board of Directors
desires to grant an award of Restricted Stock Units and Nonqualified Stock
Options (as defined below in Section 1) under the Plan to Participant on the
terms and conditions set forth below.

NOW, THEREFORE, in consideration of the various covenants and agreements herein
contained, and intending to be legally bound hereby, the parties hereto agree as
follows:

1.Grant of Restricted Stock Units and Options.

Subject to the provisions of this Agreement and to the provisions of the Plan,
the Corporation hereby grants to Participant, as of the Date of Grant,
_________________ (_______) Restricted Stock Units (the “Restricted Stock Units”
or “RSUs”) and ___________ (_____) Nonqualified Stock Options (the “Options”).
The Options granted hereunder are not intended to qualify as incentive stock
options pursuant to Section 422 of the Internal Revenue Code of 1986, as
amended. All capitalized terms used herein, to the extent not defined, shall
have the meanings set forth in the Plan.

2.Restrictions on RSUs.

(a)Until the settlement of vested Restricted Stock Units pursuant to Section 4,
the Restricted Stock Units shall not confer or entitle Participant to any rights
of a stockholder including, without limitation, any voting rights or to any
dividends paid on Shares.  

(b)The Restricted Stock Units shall not be transferable by Participant by means
of sale, assignment, exchange, encumbrance, pledge, hedge or otherwise. Any
attempt to dispose of the Restricted Stock Units in a manner contrary to the
restrictions set forth in this Agreement shall be ineffective.

3.When Restricted Stock Units and Options Vest.

(a)Time-Based Vesting.

(i)Restricted Stock Units. With respect to ______________ (_______) Restricted
Stock Units, provided that Participant is employed by the Corporation or a
Subsidiary on

 

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the applicable date, the Restricted Stock Units shall vest on the date of each
anniversary of the Date of Grant, as follows:

Date

Vested RSUs

1st Anniversary

[⅓]

2nd Anniversary

[⅓]

3rd Anniversary

[⅓]

 

(ii)Options. With respect to the Options, provided that Participant is employed
by the Corporation or a Subsidiary on the applicable date, the Options shall
vest on the date of each anniversary of the Date of Grant, as follows:

Date

Vested Options

1st Anniversary

[⅓]

2nd Anniversary

[⅓]

3rd Anniversary

[⅓]

 

 

(b) Performance-Based Vesting. With respect to _______________ (_____________)
Restricted Stock Units, provided that Participant is employed by the Corporation
or a Subsidiary on December 31, 2022, the Restricted Stock Units shall vest
based upon the attainment of the performance goals set forth in Appendix A to
this Agreement.

(c)Other Vesting Events. Notwithstanding the foregoing, the Restricted Stock
Units and Options shall vest at such earlier time as the restrictions may lapse
pursuant to Sections 7 or 9 of this Agreement.  The foregoing notwithstanding,
in the event of a pending or threatened Change of Control, or in connection with
any merger, consolidation, acquisition, separation, reorganization, liquidation
or like occurrence in which the Corporation is involved, the Board of Directors
may, in its sole discretion, take such actions as permitted under the Plan.

(d)Forfeiture for Violation of Restrictive Covenants. As consideration for the
grant of the Restricted Stock Units and Options, Participant agrees to the
restrictive covenants set forth in Appendix B to this Agreement. Participant
shall forfeit any Options and unvested Restricted Stock Units, or any Shares
that Participant receives in settlement of any vested Restricted Stock Units
from the exercise of Options, if he or she violates any of the restrictive
covenants set forth in Appendix B.

(e)Forfeiture for Cause. Any unvested Restricted Stock Units and Options shall
be forfeited if Participant is determined to have engaged in an act that
constitutes Cause (regardless of whether Participant’s service with the
Corporation is terminated as a result of such Cause). If any Restricted Stock
Units become payable while Participant is under investigation for any event that
would constitute Cause, payment of such Restricted Stock Units shall be delayed
pending the outcome of such investigation. If such investigation is pending on
the latest date upon which such Restricted Stock Units may be paid in order for
payment of the Restricted Stock Units to remain qualified as a short-term
deferral under Treasury Regulation Section 1.409A-1(b)(4) or would otherwise not
result in a violation of Code Section 409A, settlement of the Restricted Stock
Units shall be made on that date only if Participant executes an agreement with
the Corporation under which he or she agrees to forfeit the Shares that were
paid with respect to such Restricted Stock Units if the investigation results

 

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in Participant being found to have committed an act that constitutes Cause. If
Participant fails to execute such an agreement, the Restricted Stock Units shall
be forfeited. If any Options would become vested while Participant is under
investigation for any event that would constitute Cause, the vesting of such
Options shall be delayed pending the outcome of such investigation.

For purposes of this Agreement, “Cause” means (i) the commission of an act of
fraud, embezzlement, theft or proven dishonesty, or any other illegal act or
practice (whether or not resulting in criminal prosecution or conviction),
including theft or destruction of property of the Corporation or a Subsidiary,
or any other act or practice which the Committee shall, in good faith, deem to
have resulted in the recipient’s becoming unbondable under the Corporation or
any Subsidiary’s fidelity bond; (ii) the willful engaging in misconduct which is
deemed by the Committee, in good faith, to be materially injurious to the
Corporation or any Subsidiary, monetarily or otherwise, including, but not
limited to, improperly disclosing trade secrets or other confidential or
sensitive business information and data about the Corporation or any
Subsidiaries and competing with the Corporation or any Subsidiaries, or
soliciting employees, consultants or customers of the Corporation or any
Subsidiaries in violation of law or any employment or other agreement to which
the recipient is a party; (iii) the continued failure or habitual neglect by a
person who is an employee to perform his or her duties with the Corporation or
any Subsidiary; or (iv) other disregard of rules or policies of the Corporation
or any Subsidiary, or conduct evidencing willful or wanton disregard of the
interests of the Corporation or any Subsidiary. For purposes of this Agreement,
no act or failure to act by the recipient shall be deemed “willful” unless done
or omitted to be done by the recipient not in good faith and without reasonable
belief that the recipient’s action or omission was in the best interest of the
Corporation and/or the Subsidiary. Notwithstanding the foregoing, if Participant
has entered into an employment agreement that is binding as of the date of such
event, and if such employment agreement defines “Cause,” then the definition of
“Cause” in such agreement shall apply. The determination of whether a
Participant has engaged in an act that constitutes Cause shall be made by the
Committee, which prior to making such determination shall provide written notice
of the event of Cause to Participant and allow Participant a reasonable
opportunity to cure such event.

4.Settlement of Restricted Stock Units.

Subject to Sections 3(d) and 6, as soon as practicable after the date on which
any Restricted Stock Units become vested, and in no event later than 30 days
after such date, the Corporation shall deliver to Participant (or his or her
personal representative) the number of Shares equal to the number of Restricted
Stock Units that have become vested (or, at the discretion of the Committee,
cash with a value of such number of Shares).

5.Provisions Relating to Options.

(a)Options shall be exercised by Participant by providing notice of such
exercise via the written or electronic medium specified by the Corporation,
setting forth the number of Shares with respect to which the Option is to be
exercised, accompanied by full payment for the Shares, including satisfaction of
any applicable withholding taxes.

(b)Upon the exercise of any Option, the Exercise Price shall be payable to the
Corporation in full in cash or its equivalent. The Committee, in its sole
discretion, also may permit exercise (i) by tendering previously acquired Shares
having an aggregate Fair Market Value at the time of exercise equal to the total
Exercise Price (such previously acquired Shares must have been held for the
requisite period necessary to avoid a charge to the Corporation’s earnings for
the financial reporting purposes, unless

 

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otherwise determined by the Committee), or (ii) by any other means which the
Committee, in its sole discretion, determines to both provide legal
consideration for the Shares, and to be consistent with the purposes of the
Plan.

(c)The Options shall not be transferable by Participant by means of sale,
assignment, exchange, encumbrance, pledge, hedge or otherwise. Any attempt to
dispose of the Options in a manner contrary to the restrictions set forth in
this Agreement shall be ineffective. Notwithstanding the foregoing, (i) Options
may be transferred to Participant’s spouse, former spouse or dependent pursuant
to a court-approved domestic relations order which relates to the provision of
child support, alimony payments or marital property rights; and (ii) in the
event of Participant’s death, the administrator or executor of Participant’s
estate may exercise any outstanding vested Options within the time period
specified in Section 7(b) below.

(d)Participant shall not be deemed for any purpose to be the owner of any Shares
subject to any Options unless and until (i) the Options have been exercised
pursuant to the terms hereof, (ii) the Corporation shall have issued and
delivered the Shares to Participant (or made a book entry registration thereof)
and (iii) Participant’s name shall have been entered as a stockholder of record
on the books of the Corporation. Thereupon, Participant shall have full voting,
dividend and other ownership rights with respect to such Shares.

6.Tax Withholding.

Whenever Participant becomes vested in some or all of the Restricted Stock Units
under Section 3 of this Agreement or exercises Options under Section 5 of this
Agreement, the Corporation shall notify Participant of the amount of tax which
must be withheld by the Corporation under all applicable federal, state and
local tax laws. Participant agrees to make arrangements with the Corporation to
(a) remit a cash payment of the required amount to the Corporation, (b)
authorize the deduction of such amounts from Participant’s compensation; (c)
perform a cashless exercise through the Corporation’s equity plan administration
system; or (d) to otherwise satisfy the applicable tax withholding requirement
in a manner satisfactory to the Corporation.

7.Forfeiture On Termination of Employment, Expiration of Options.

(a)If Participant’s employment with the Corporation or Subsidiary is terminated
for any reason, either by the Corporation or Participant, during the term of
this Agreement, any Options and Restricted Stock Units remaining subject to the
restrictions imposed by this Agreement shall be forfeited; provided, however,
that in the event of a Termination of Service by reason of death, Disability, or
Retirement, any remaining restrictions automatically shall lapse.

(b)If not previously exercised, the Options shall terminate at the close of
business on the tenth (10th) anniversary of this Agreement, or, if earlier,
three (3) months after Participant’s Termination of Service (12 months after the
Termination of Service if such termination is due to Participant’s Retirement,
death or Disability). Participant shall have no right to exercise the Options at
any time after such date unless otherwise permitted by the Corporation.

 

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8.Restricted Stock Units and Options Not to Affect Employment.

Neither this Agreement nor the Restricted Stock Units and Options granted
hereunder shall confer upon Participant any right to continued employment with
the Corporation or any Subsidiary, and shall not in any way modify or restrict
the Corporation’s or such Subsidiary’s right to terminate such employment.

9.Agreement Subject to the Plan.

This Agreement and the rights and obligations of the parties hereto are subject
to and governed by the terms of the Plan as the same may be amended from time to
time, the provisions of which are incorporated by reference into this Agreement.

10.Award Subject to Clawback or Recoupment. 

The Restricted Stock Units and Options shall be subject to clawback or
recoupment pursuant to any compensation clawback or recoupment policy adopted by
the Corporation or required by law that is applicable to Participant. In
addition to any other remedies available under such policy, applicable law may
require the cancellation of Participant’s Restricted Stock Units and Options
(whether vested or unvested) and the recoupment of any gains realized with
respect to Participant’s Restricted Stock Units or any Shares acquired via
exercise of the Options.

11.Miscellaneous.

(a)In the event of any change or changes in the outstanding Shares of the
Corporation by reason of any stock dividend, recapitalization, reorganization,
merger, consolidation, combination or any similar transaction, the Board of
Directors shall adjust the number of Restricted Stock Units and Options granted
under this Agreement and the Exercise Price of the Options, and make any and all
other adjustments deemed appropriate by the Board of Directors in such manner as
the Board of Directors deems necessary to prevent material dilution or
enlargement of the rights granted to Participant.  

(b)It is the intention of the Corporation that the Restricted Stock Units and
Options will be exempt from, or will comply with the requirements of, Section
409A of the Code, and the Plan and the terms and conditions of the Options shall
be interpreted, construed and administered consistent with such intent. Although
the Corporation intends to administer the Plan, the Restricted Stock Units and
the Options in compliance with Section 409A of the Code or an exemption thereto,
the Corporation does not warrant that the terms of the Restricted Stock Units
and Options, or the Corporation’s administration thereof, will be exempt from,
or will comply with the requirements of, Section 409A of the Code. The
Corporation shall not be liable to Participant or any other person for any tax,
interest, or penalties that the person may incur as a result of the Options or
the Corporation’s administration thereof not satisfying any of the requirements
of Section 409A of the Code.

(c)This Agreement may be executed in one or more counterparts, all of which
taken together will constitute one and the same instrument.

(d)The terms of this Agreement may only be amended, modified or waived by a
written agreement executed by both of the parties hereto.

 

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(e)The validity, performance, construction and effect of this Agreement shall be
governed by the laws of the State of Florida, without giving effect to
principles of conflicts of law.

(f)This Agreement constitutes the entire agreement between the parties hereto
with respect to the transactions contemplated herein.

(g)Except as otherwise herein provided, this Agreement shall be binding upon and
shall inure to the benefit of the Corporation, its successors and assigns, and
of Participant and Participant’s personal representatives.

 

IN WITNESS WHEREOF, the parties have executed this Restricted Stock Unit and
Stock Option Agreement as of the day and year first above written.

 

 

 

HELIOS TECHNOLOGIES, INC.

ATTEST:

 

 

 

 

 

 

 

 

 

 

By:

Melanie M. Nealis, Secretary                                                  

 

Tricia L. Fulton, Chief Financial Officer

 

 

 

 

 

PARTICIPANT

Witness:

 

 

 

 

 

 

 

 

 

 

 

 

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APPENDIX A

PERFORMANCE GOALS

 

The following table provides the performance goals for vesting of the Restricted
Stock Units covered by Performance-Based Vesting in Section 3(b). The
performance goals are as follows:

 

 

•

Net Sales for the Corporation for the three-fiscal year period of December 29,
2019 through December 31, 2022 (weight = 20%)

 

•

Earnings per Share for the Corporation for the three-fiscal year period of
December 29, 2019 through December 31, 2022 (sum of three years as reported in
the Corporation’s Form 10-K) (weight = 40%)

 

•

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA)
Margin for the Corporation the three-fiscal year period of December 29, 2019
through December 31, 2022 (sum of three years as publicly announced by the
Corporation) (weight = 40%)

 

 

[LTI Performance Payout Grid Redacted; Company Confidential]

 

 

 

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APPENDIX B

RESTRICTIVE COVENANTS

 

Participant acknowledges and recognizes the highly competitive nature of the
Corporation’s business and, in consideration of the Restricted Stock Units and
Options granted to Participant, the Participant agrees to the following:

A. Non-Competition. During period of Participant’s employment with the
Corporation (and any Subsidiary) and the 12-month period following his or her
termination of employment (the “Restricted Period”), anywhere in the world (the
“Restricted Area”), Participant will not, individually or in conjunction with
others, directly or indirectly, engage in any Competitive Business Activities
(as hereinafter defined) other than on behalf of the Corporation, unless
specifically agreed to in writing by the Corporation, and as agreed by the
Corporation and Participant, whether on a full-time or on a part-time basis,
whether as an officer, director, proprietor, employee, partner, independent
contractor, investor (other than as a holder of less than five percent (5%) of
the outstanding capital stock of a publicly traded corporation), consultant,
advisor, agent or otherwise.  “Competitive Business Activities” shall mean any
business that engages in providing products and services that are competitive
with any products and services provided by the Corporation as of the date of
this Agreement and at any time during Participant’s employment with the
Corporation and its Subsidiaries.

B. Non-solicitation. During the Restricted Period and within the Restricted
Area, Participant will not, directly or indirectly, compete with the Corporation
by soliciting, inducing or influencing any of the Corporation’s Customers which
have a business relationship in the with the Corporation at any time during the
Restricted Period to discontinue or reduce the extent of such relationship with
the Corporation.  The Corporation’s “Customers” shall be deemed to be any Person
that the Corporation or its Subsidiaries is doing business with (as reflected by
any sales or services provided to that person in the preceding two-year period)
and those with whom the Corporation or its Subsidiaries has a reasonable
expectation of doing business during the Restricted Period.

In addition, during the Restricted Period and within the Restricted Area,
Participant will not, directly or indirectly, for or on behalf of himself or any
other Person, (a) recruit, solicit or otherwise influence any employee of the
Corporation to discontinue such employment relationship with the Corporation, or
(b) employ or seek to employ, or cause or permit to be employed any person who
is then (or was at any time within six (6) months prior to the date Participant
employs or seeks to employ such person) an employee of the Corporation.  For
purposes of this Appendix B, “employ” shall be deemed to mean to engage or
permit to be engaged, whether as a legal employee or as an independent
contractor.

In addition, during the Restricted Period, Participant will not interfere with,
disrupt or attempt to disrupt any past, present or prospective relationship,
contractual or otherwise, between the Corporation and any Customer, employee or
agent in the Corporation.

“Person” shall be deemed to mean and include natural persons, partnerships,
corporations, limited liability companies, professional associations or other
organizations or entities; and, with respect to a non-natural person, its
subsidiaries and controlled affiliates.

The restrictions in Sections A and B of this Appendix B apply in respect of
businesses which compete or seek to compete with the Corporation and its
Subsidiaries, and nothing in this Appendix B shall prevent Participant from
engaging in activities that do not compete with the Corporation and its
Subsidiaries.

 

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C. Non-Disclosure of Information.  Participant acknowledges that the
Corporation’s trade secrets; private or secret procedures; methods and ideas;
market research data or analyses and marketing plans; fees, costs and pricing
structures; customer lists and information concerning the Corporation’s
products, services, training methods, development, technical information,
marketing activities and procedures, and corporate strategies, credit, financial
and other data concerning the Corporation’s Customers, as they exist from time
to time; and other information, observations and data obtained by Participant
while employed by the Corporation concerning the Corporation’s business,
products, services and business relationships; and all similar and related
information in whatever form (“Proprietary Information”) are valuable, special
and unique assets of the Corporation, access to and knowledge of which are
essential to the performance by Participant of his or her employment with the
Corporation.  In light of the highly competitive nature of the industry in which
the Corporation’s business is conducted, Participant agrees that all Proprietary
Information, heretofore or in the future obtained by him or her as a result of
his or her association with the Corporation shall be considered confidential.

In recognition of this fact, Participant agrees that Participant will never use
or disclose any such Proprietary Information for Participant’s own purposes or
for the benefit of any person or other entity or organization (except the
Corporation) under any circumstances unless such Proprietary Information has
been publicly disclosed generally or, unless upon written advice of legal
counsel reasonably satisfactory to the Corporation, Participant is legally
required to disclose such Proprietary Information.  Documents (as hereinafter
defined) prepared by Participant or that come into Participant’s possession
during Participant’s association with the Corporation are and remain the
property of the Corporation, and when this Agreement terminates, such Documents
shall be returned to the Corporation at its principal place of business and
herein noted.

“Documents” shall mean all original written, recorded, or graphic matters
whatsoever, and any and all copies thereof, including, but not limited
to:  papers; books; records; tangible things; correspondence; e-mail, telecopy
and telex messages; memoranda; work‑papers; reports; statements; summaries;
analyses; evaluations; Customer records and information; agreements; agendas;
advertisements; manuals; brochures; publications; directories; industry lists;
schedules; price lists; Customer lists; statistical records; training manuals;
computer printouts; books of account, records and invoices reflecting business
operations; all things similar to any of the foregoing however denominated.  In
all cases where originals are not available, the term “Documents” shall also
mean identical copies of original documents or non‑identical copies thereof.

Notwithstanding any other provisions of this Agreement to the contrary, pursuant
to the Defend Trade Secrets Act, 18 U.S.C. §1833(b), an individual may not be
held criminally or civilly liable under any federal or state trade secret law
for disclosure of a trade secret:  (i) made in confidence to a government
official, either directly or indirectly, or to an attorney, solely for the
purpose of reporting or investigating a suspected violation of law; and/or
(ii) in a complaint or other document filed in a lawsuit or other proceeding, if
such filing is made under seal.  Additionally, an individual suing an employer
for retaliation based on the reporting of a suspected violation of law may
disclose a trade secret to his or her attorney and use the trade secret
information in the court proceeding, so long as any document containing the
trade secret is filed under seal and the individual does not disclose the trade
secret except pursuant to court order.

D. Non-Disparagement.  Except as otherwise required by law, Participant will not
make, publish, or disseminate any derogatory statements or comments about the
Corporation or any of its Subsidiaries and affiliated entities, or any of their
past or present officers or directors, or take any action which a reasonable
person would expect would impair the good will, business reputation, or good
name of any of them.  

 

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E. Independent Obligations, Remedies.  It is understood by and between the
parties hereto that the foregoing covenants by Participant contained in this
Appendix B shall be construed to be agreements independent of any other element
of Participant’s employment with the Corporation.  The existence of any claim or
cause of action, whether predicated on any other provision in this Agreement, or
otherwise, as a result of the relationship between the parties shall not
constitute a defense to the enforcement of the covenants in this Agreement
against Participant, and the Corporation’s breach of any term of this Agreement
or any other obligation does not waive or release Participant from the
restrictions contained in this Appendix B.

1. Participant acknowledges and agrees that the Corporation’s remedy at law for
a breach or threatened breach of any of the provisions of this Appendix B would
be inadequate and the breach shall be per se deemed as causing irreparable harm
to the Corporation.  In recognition of this fact, in the event of a breach by
Participant of any of the provisions of this Appendix B, Participant agrees
that, in addition to any remedy at law available to the Corporation, including,
but not limited to monetary damages, the Corporation, without posting any bond,
shall be entitled to obtain, and Participant agrees not to oppose the
Corporation’s request for equitable relief in the form of specific performance,
temporary restraining order, temporary or permanent injunction or any other
equitable remedy which may then be available to the Corporation.

2. Participant acknowledges that the granting of a temporary injunction,
temporary restraining order or permanent injunction merely prohibiting the use
of Proprietary Information would not be an adequate remedy upon breach or
threatened breach of this Appendix B and consequently agrees, upon proof of any
such breach, to the granting of injunctive relief prohibiting any form of
competition with the Corporation.  Nothing herein contained shall be construed
as prohibiting the Corporation from pursuing any other remedies available to it
for such breach or threatened breach.

F. Impact on Other Agreements. If Participant is or becomes party to any other
restrictive covenant agreement with the Corporation or one of its subsidiaries,
the obligations under such other restrictive covenant agreement shall not be
superseded by this Appendix B to the extent inconsistent therewith, but shall be
supplanted by this Appendix B to the extent permitted by applicable law.
Further, to the extent that any provision(s) of this Appendix B are declared
overbroad, void or unenforceable by an authority of competent jurisdiction in a
particular jurisdiction, the provision(s) shall be modified by such authority
for purposes of enforcement in that jurisdiction to the extent necessary to make
the applicable provision(s) valid and enforceable.  Modification of a provision
of this Appendix B to validate its enforcement in any particular jurisdiction,
however, will not affect the enforcement of the provision as stated in any other
jurisdiction in which it is enforceable.  Also, the invalidity of a provision of
this Appendix B in any particular jurisdiction will not affect the validity or
enforcement of that provision in any other jurisdiction where it is otherwise
valid.

 

 

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