EXHIBIT 10.43

 

KEYSTONE AUTOMOTIVE INDUSTRIES, INC.

 

1996 EMPLOYEE STOCK INCENTIVE PLAN, AS AMENDED

 

RESTRICTED STOCK AGREEMENT

 

THIS RESTRICTED STOCK AGREEMENT (this “Agreement”) made effective as of June 1,
2004 between Keystone Automotive Industries, Inc., a California corporation (the
“Company”), and Richard L. Keister, an employee of the Company (as such term is
defined below), hereinafter referred to as the “Restricted Stockholder.”

 

WHEREAS, the Company has established the 1996 Employee Stock Incentive Plan, as
amended (the “Plan”);

 

WHEREAS, the Company wishes to carry out the Plan (the terms of which are hereby
incorporated by reference and made a part of this Agreement);

 

WHEREAS, the Plan provides for, among other things, the issuance of shares of
the Company’s common stock the “Common Stock”), subject to certain restrictions
thereon (hereinafter referred to as “Restricted Stock”);

 

WHEREAS, the Company’s Board of Directors (the “Board”) appointed to administer
the Plan, has determined that it is to the advantage and best interest of the
Company and its stockholders to grant an award of 30,000 shares of Restricted
Stock to the Restricted Stockholder in consideration for his joining the Company
and as an incentive for his efforts during future service; and

 

WHEREAS, the Compensation Committee (the “Committee”) has also approved the
issuance by the Company of the Award of Restricted Stock and has so advised the
Board.

 

NOW, THEREFORE, in consideration of the mutual covenants in this Agreement and
other good and valuable consideration, receipt of which is hereby acknowledged,
the Company and the Restricted Stockholder agree as follows:

 

ARTICLE I.

 

DEFINITIONS

 

Whenever the following terms are used in this Agreement they shall have the
meaning specified below unless the context clearly indicates to the contrary.
The masculine pronoun shall include the feminine and neuter, and the singular
the plural, where the context so indicates. All capitalized terms used in this
Agreement without definition shall have the meaning given to such terms in the
Plan.

 

“Board” shall mean the Board of Directors of the Company.

 

“Cause” shall mean a determination, by at least a majority of the members of the
Board at a meeting of the Board called and held for such purpose (after
reasonable notice is provided to the Executive of such meeting, the purpose
thereof and the Executive is given an opportunity to be heard before the Board),
that Executive (i) has committed fraud, gross negligence or gross misconduct
that results in material harm to the Company or (ii) has been convicted of, or
entered a plea of guilty or “nolo contendre” to, a felony or (iii) is in
material breach of the terms of his unsigned Employment Memorandum of
Understanding (the “Understanding”), to have been effective as of June 1, 2004,
after receiving written notice specifying the breach and failing to cure the
breach within thirty days of the date notice is given, as if the Understanding
had been signed and was binding upon the parties.

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“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

 

“Fair Market Value” of a share of Common Stock as of a given date shall be (i)
the closing price of a share of Common Stock on the principal exchange on which
shares of Common Stock are then trading, if any (or as reported on any composite
index which includes such principal exchange), on the trading day previous to
such date, or if shares were not traded on the trading day previous to such
date, then on the next preceding date on which a trade occurred, or (ii) if
Common Stock is not traded on an exchange but is quoted on NASDAQ or a successor
quotation system, the mean between the closing representative bid and asked
prices for the Common Stock on the trading day previous to such date as reported
by NASDAQ or such successor quotation system or if the Common Stock is traded on
the NASDAQ National Market, the closing price on such date; or (iii) if Common
Stock is not publicly traded on an exchange and not quoted on NASDAQ or a
successor quotation system, the Fair Market Value of a share of Common Stock as
established by the Board or the Board acting in good faith.

 

“Performance Failure” shall mean (i) the continued failure by Executive to
follow the reasonable directions of the Board or (ii) the Executive’s continual
and material variances from objectives listed in any annual Performance Planning
and Evaluation model for the Executive that may be approved by the Board, after
review with Executive on a semi-annual basis; provided, however, that a failure
to achieve sales, revenues or earnings targets due to reasons or circumstances
external to the Company, which are not in the reasonable control of Executive,
shall not be considered a Performance Failure.

 

“Good Reason” shall mean (i) the assignment to the Executive of any duties
inconsistent with the Executive’s position as President and Chief Executive
Officer of the Company, (ii) a diminishment in the nature or status of the
Executive’s responsibilities without the consent of the Executive, (iii) without
the consent of the Executive, a relocation of the Company’s principal place of
business outside a twenty five (25) mile radius of its current headquarters in
Pomona, California, or (iv) a material breach by the Company of any of the terms
of Executive’s employment as set forth in the Understanding, whether
compensation, benefit related or otherwise, after the Company is given written
notice by the Executive specifying the breach and failing to cure such breach
within thirty days of the date notice is given.

 

“Notice of Termination” shall mean a notice of termination sent by the Company
or the Executive notifying the other of the termination of the employment
relationship, which Notice of Termination must be delivered, except in the event
of the death of the Executive, for such termination to be effective.

 

“Restricted Stock” shall mean Common Stock of the Company issued under this
Agreement and subject to the Restrictions imposed under this Agreement and under
the Plan.

 

“Restrictions” shall mean the restrictions on sale or other transfer set forth
in Section 3.4 of this Agreement and the exposure to forfeiture as set forth in
Section 3.1 of this Agreement.

 

“Rule 16b-3” shall mean Rule 16b-3 under the Exchange Act, as such Rule may be
amended from time to time.

 

“Secretary” shall mean the Secretary of the Company.

 

“Securities Act” shall mean the Securities Act of 1933, as amended.

 

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ARTICLE II.

 

ISSUANCE OF RESTRICTED STOCK

 

Section 2.1 Issuance of Restricted Stock

 

In consideration of the Restricted Stockholder’s agreement to remain as an
employee of the Company and to serve as its President and Chief Executive
Officer if elected to those positions, and for other good and valuable
consideration, on the date of this Agreement the Company issues to the
Restricted Stockholder 30,000 shares of Restricted Stock upon the terms and
conditions set forth in this Agreement.

 

Section 2.2 Purchase Price

 

The purchase price of the Restricted Stock shall be $0 per share.

 

Section 2.3 Consideration to Company

 

In consideration for the issuance of Restricted Stock by the Company, the
Restricted Stockholder agrees to render faithful and efficient services to the
Company with such duties and responsibilities as the Company shall from time to
time prescribe consistent with the Understanding. Nothing in this Agreement or
in the Plan shall confer upon the Restricted Stockholder any right to continue
in the employ of the Company or shall interfere with or restrict in any way the
rights of the Company, which are hereby expressly reserved, to discharge the
Restricted Stockholder at any time for any reason whatsoever, with or without
cause.

 

Section 2.4 Adjustments in Restricted Stock

 

In the event that the outstanding shares of Common Stock are changed into or
exchanged for a different number or kind of capital stock or other securities of
the Company by reason of merger, consolidation, recapitalization,
reclassification, stock split-up, stock dividend or combination of shares, the
Committee, subject to the provisions of the Plan and this Agreement, shall make
an appropriate and equitable adjustment in accordance with the provisions of the
Plan in the number and kind of shares of Restricted Stock, to the end that after
such event the Restricted Stockholder’s proportionate interest shall be
maintained as before the occurrence of such event. Any such adjustment made by
the Committee or the Board shall be final and binding upon the Restricted
Stockholder, the Company and all other interested persons.

 

ARTICLE III.

 

RESTRICTIONS

 

Section 3.1 Forfeiture of Restricted Stock

 

Since no cash consideration was paid by the Restricted Stockholder for the
Restricted Stock, immediately upon a termination of employment, subject to the
provisions of Section 3.3, the Restricted Stockholder’s rights in the Restricted
Stock then still subject to Restrictions shall lapse and be terminated.

 

Section 3.2 Legend

 

Certificates representing shares of Restricted Stock issued pursuant to this
Agreement shall, until all Restrictions lapse and new certificates are issued
pursuant to Section 3.3 of this Agreement, bear the following legend:

 

“The shares represented by this certificate are subject to reacquisition by
Keystone Automotive Industries, Inc., and such shares may not be sold or
otherwise transferred except pursuant to the provisions of the Restricted Stock
Agreement by and between Keystone Automotive Industries, Inc. and the registered
owner of such shares.”

 

 

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Section 3.3 Lapse of Restrictions

 

(a) All Restrictions on transfer or sale shall lapse as to 7,500 shares on each
anniversary of this Agreement until all restrictions have lapsed. In the event
of the termination of the employment of the Restricted Stockholder before the
restrictions have lapsed with respect to all of the shares of Restricted Stock,
the remaining restrictions shall lapse in accordance with the following
provisions:

 

(i) In the event of a termination by the Company for Cause or a termination by
the Executive other than for Good Reason, the provisions of Section 3.1 shall
apply immediately upon such termination.

 

(ii) In the event of a termination for Performance Failure, the death of the
Executive or as a result of a disability event as defined below, any shares of
Restricted Stock whose restrictions would have lapsed during the 12-month period
following the termination shall be deemed to have lapsed as of the date of
termination. Any shares which are subject to restrictions which lapse after said
12-month period shall be subject to the provisions of Section 3.1 immediately
upon the termination.

 

(iii) In the event of a termination by the Company other than for Cause or
Performance Failure, or if the Executive shall terminate his employment for Good
Reason, any and all restrictions applicable to shares of the Restricted Stock
shall lapse immediately upon such termination.

 

(b) Upon the lapse of the Restrictions, the Company shall cause new certificates
to be issued with respect to such shares and delivered to Restricted Stockholder
or his legal representative, free from the legend provided for in Section 3.2 of
this Agreement and any of the other Restrictions. Notwithstanding the foregoing,
no such new certificate shall be delivered to Restricted Stockholder or his
legal representative unless and until Restricted Stockholder or his legal
representative shall have paid to the Company in cash the full amount of all
federal and state withholding or other employment taxes applicable to the
taxable income of the Restricted Stockholder resulting from the grant of
Restricted Stock or the lapse of the Restrictions, or the Restricted Stockholder
or his legal representative otherwise satisfy such tax obligations by having the
Company withhold shares of Common Stock, as provided in Section 4.9 of this
Agreement.

 

(c) A disability event shall be defined as the Executive’s inability to perform
the services required under the Understanding as a result of Executive’s
physical or mental disability for an aggregate of 180 days out of any 365 day
period. The Company may terminate the Executive’s employment upon the occurrence
of a disability event.

 

Section 3.4 Restricted Stock Not Transferable

 

Until the Restrictions under this Agreement lapse, neither the Restricted Stock
(including any shares issued with respect to shares of Restricted Stock as a
result of stock dividends, stock splits or any other form of recapitalization)
nor any interest or right in the Restricted Stock or part of the Restricted
Stock shall be liable for the debts, contracts, or engagements of the Restricted
Stockholder or his successors in interest or shall be subject to disposition by
transfer, alienation, anticipation, pledge, encumbrance, assignment or any other
means whether such disposition be voluntary or involuntary or by operation of
law by judgment, levy, attachment, garnishment or any other legal or equitable
proceedings (including bankruptcy) and any attempted disposition of the
Restricted Stock shall be null and void and of no effect; provided, however,
that, this Section 3.4 shall not prevent transfers by will or by the applicable
laws of descent and distribution.

 

Section 3.5 Restrictions on New Shares

 

In the event of an adjustment in the number or kind of shares of Restricted
Stock under Section 2.4 above, such new or additional or different shares or
securities which are attributable to the Restricted Stockholder in his capacity
as the owner of the Restricted Stock then subject to Restrictions, shall be
considered to be Restricted Stock and shall be subject to all of the
Restrictions.

 

 

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ARTICLE IV.

 

MISCELLANEOUS

 

Section 4.1 Administration

 

The Board shall have the power to interpret the Plan and this Agreement and to
adopt such rules for the administration, interpretation and application of the
Plan as are consistent therewith and to interpret, amend or revoke any such
rules. All actions taken and all interpretations and determinations made by the
Board in good faith shall be final and binding upon the Restricted Stockholder,
the Company and all other interested persons. No member of the Board shall be
personally liable for any action, determination, or interpretation made in good
faith with respect to the Plan or the Restricted Stock. In its absolute
discretion, the Board may at any time and from time to time exercise any and all
rights and duties of the Committee under the Plan and this Agreement except with
respect to matters which under Rule 16b-3 are required to be determined in the
sole discretion of the Committee.

 

Section 4.2 Escrow

 

The Secretary of the Company or such other escrow holder as the Committee or the
Board may appoint shall retain physical custody of the certificates representing
the Restricted Stock, including shares of Restricted Stock issued pursuant to
Section 3.5 of this Agreement, until all of the Restrictions with respect to
those shares expire or shall have been removed; provided, however, that in no
event shall the Restricted Stockholder retain physical custody of any
certificates representing Restricted Stock issued to him.

 

Section 4.3 Notices

 

Any notice to be given by the Restricted Stockholder under the terms of this
Agreement shall be addressed to the Secretary of the Company or his office. Any
notice to be given to the Restricted Stockholder shall be addressed to him at
the address given beneath his signature to this Agreement. By a notice given
pursuant to this Section, either party may hereafter designate a different
address for notices to be given to him. Any notice which is required to be given
to the Restricted Stockholder shall, if Restricted Stockholder is then deceased,
be given to the Restricted Stockholder’s personal representative if such
representative has previously informed the Company of his status and address by
written notice under this Section. Any notice shall be deemed duly given when
enclosed in a properly sealed envelope or wrapper addressed as aforesaid,
deposited (with postage prepaid) in a post office or branch post office
regularly maintained by the United States Postal Service.

 

Section 4.4 Rights as Stockholder

 

Except as otherwise provided in this Agreement, the holder of the Restricted
Stock shall have all the rights of a stockholder with respect to the Restricted
Stock, including the right to vote the Restricted Stock and the right to receive
all dividends or other distributions paid or made with respect to the Restricted
Stock; provided, however, that in the discretion of the Board, any extraordinary
distributions with respect to shares of Common Stock that are subject to the
Restrictions may also be subject to the Restrictions.

 

Section 4.5 Titles

 

Titles are provided in this Agreement for convenience only and are not to serve
as a basis for interpretation or construction of this Agreement.

 

Section 4.6 Governing Law

 

This Agreement shall be administered, interpreted and enforced under the
internal laws of the state of California.

 

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Section 4.7 Conformity to Securities Laws

 

The Restricted Stockholder acknowledges that the Plan and this Agreement are
intended to conform to the extent necessary with all provisions of all
applicable federal and state laws, rules and regulations (including, but not
limited to the Securities Act and the Exchange Act and any and all regulations
and rules promulgated by the Securities and Exchange Commission thereunder,
including without limitation the applicable exemptive conditions of Rule 16b-3)
and to such approvals by any listing, regulatory or other governmental authority
as may, in the opinion of counsel for the Company, be necessary or advisable in
connection with such laws, rules and regulations. Notwithstanding anything in
this Agreement to the contrary, the Plan shall be administered, and the
Restricted Stock is granted, only in such a manner as to conform to such laws,
rules and regulations. To the extent permitted by applicable law, the Plan, this
Agreement and the Restricted Stock shall be deemed amended to the extent
necessary to conform to such laws, rules and regulations.

 

Section 4.8 Amendments

 

This Agreement and the Plan may be amended without the consent of the Restricted
Stockholder provided that such amendment would not impair any rights of the
Restricted Stockholder under this Agreement. No amendment of this Agreement
shall, without the consent of the Restricted Stockholder, impair any rights of
the Restricted Stockholder under this Agreement.

 

Section 4.9 Tax Withholding

 

The Company shall be entitled to require payment in cash or deduction from other
compensation payable to the Restricted Stockholder of any sums required by
federal, state or local tax law to be withheld with respect to the issuance,
vesting, exercise or payment of the Restricted Stock. In satisfaction of the
foregoing requirement, the Restricted Stockholder may elect to have the Company
withhold shares of Common Stock otherwise issuable under such award (or allow
the return of shares of Common Stock) having a Fair Market Value equal to the
sums required to be withheld.

 

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IN WITNESS WHEREOF, this Agreement has been executed and delivered by each of
the Company and the Restricted Stockholder.

 

KEYSTONE AUTOMOTIVE INDUSTRIES, INC. By:   /s/    John M. Palumbo     Name: John
M. Palumbo     Title:   Vice President and CFO

 

RESTRICTED STOCKHOLDER

/s/    Richard L. Keister

 

Name: Richard L. Keister Restricted Stockholder’s Address    

 

Restricted Stockholder’s Social Security
Number:                                     
                                        
                                              

 

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