Exhibit 10.8

 

MAUI LAND & PINEAPPLE COMPANY, INC.
2006 EQUITY AND INCENTIVE AWARD PLAN
RESTRICTED STOCK AWARD GRANT NOTICE

 

Maui Land & Pineapple Company, Inc., a Hawaii corporation (the “Company”),
pursuant to the provisions of its 2006 Equity and Incentive Award Plan (the
“Plan”), hereby grants to the holder listed below (“Holder”), the number of
shares of the Company’s common stock, no par value (“Stock”), set forth below
(the “Shares”). This Restricted Stock award is subject to all of the terms and
conditions as set forth herein and in the Restricted Stock Award Agreement
attached hereto as Exhibit A (the “Restricted Stock Agreement”) and the Plan,
each of which are incorporated herein by reference. Unless otherwise defined
herein, the terms defined in the Plan shall have the same defined meanings in
this Restricted Stock Award Grant Notice (the “Grant Notice”). Shares that are
released from Forfeiture Restrictions in accordance with Sections 3.2 and 3.3 of
the Restricted Stock Agreement are referred to in this Grant Notice as “Released
Shares.”

 

Holder:

 

Fred W. Rickert

 

 

 

Grant Date:

 

May 8, 2006

 

 

 

Total Number of Restricted Shares:

 

6,000

 

 

 

Performance Vesting Criteria:

 

Subject to the terms and conditions of the Plan, this Grant Notice and the
Restricted Stock Agreement, up to all of the Shares shall vest and become
Released Shares following the fiscal year ending December 31, 2008 (the
“Performance Period”); provided, that the performance criteria for the 2008
fiscal year is achieved, as determined in the sole and complete discretion of
the Committee. Specific performance criteria for fiscal year 2008 shall be
established by the Committee prior to the end of the first quarter of such
fiscal year.

 

 

 

 

 

For purposes of this Agreement, financial and performance thresholds adopted by
the Committee shall be determined, unless otherwise agreed by the Company and
Holder, in accordance with consistently applied Generally Accepted Accounting
Principals, as promulgated from time to time by the Financial Accounting
Standards Board (“GAAP”).

 

 

 

 

 

With proper regard to GAAP, and sound accounting judgments and the agreements of
the Company and Holder, the Committee shall announce the extent of vesting of
the Shares for the Performance Period as soon as reasonably practicable after
audited financial statements are available for such year (the “Announcement
Date”).

 

 

 

 

 

Notwithstanding the foregoing, subject to the Restricted Stock Agreement, in no
event, shall any Shares vest and become Released Shares following Holder’s
Termination of Employment.

 

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By his or her signature below, Holder agrees to be bound by the terms and
conditions of the Plan, the Restricted Stock Agreement and this Grant Notice.
Holder has reviewed the Restricted Stock Agreement, the Plan and this Grant
Notice in their entirety, has had an opportunity to obtain the advice of counsel
prior to executing this Grant Notice and fully understands all provisions of
this Grant Notice, the Restricted Stock Agreement and the Plan. Holder hereby
agrees to accept as binding, conclusive and final all decisions or
interpretations of the Board upon any questions arising under or relating to the
Plan, this Grant Notice or the Restricted Stock Agreement.

 

MAUI LAND & PINEAPPLE COMPANY, INC.:

 

HOLDER:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

By:

 

 /S/ DAVID C. COLE

 

By:

 

 /S/ FRED W. RICKERT

Print Name:

 

 David C. Cole

 

Print Name:

 

 Fred W. Rickert

Title:

 

Chairman, President & CEO

 

 

 

 

Address:

 

P.O. Box 187

 

Address:

 

 

 

 

Kahului, Maui, Hawaii 96733

 

 

 

 

 

 

 

 

 

 

 

Dated:

 

August 4, 2006

 

 

 

 

 

2

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EXHIBIT A

 

TO RESTRICTED STOCK AWARD GRANT NOTICE

 

RESTRICTED STOCK AWARD AGREEMENT

 

Pursuant to the Restricted Stock Award Grant Notice (“Grant Notice”) to which
this Restricted Stock Award Agreement (this “Agreement”) is attached, Maui Land
& Pineapple Company, Inc., a Hawaii corporation (the “Company”), has granted to
Holder the number of shares of the Company’s common stock, no par value
(“Stock”), set forth in the Grant Notice (the “Shares”), upon the terms and
conditions set forth in the Company’s 2006 Equity and Incentive Award Plan (the
“Plan”), the Grant Notice and this Agreement.

 

ARTICLE I

GENERAL

 

1.1           DEFINED TERMS. CAPITALIZED TERMS NOT SPECIFICALLY DEFINED HEREIN
SHALL HAVE THE MEANINGS SPECIFIED IN THE GRANT NOTICE OR, IF NOT DEFINED
THEREIN, THE PLAN.

 

“Cause” means a termination of Holder’s employment by Company for any of the
following reasons:

 

(a)           Holder’s failure or refusal to comply with any lawful and
reasonable Board of Director’s policy or directive which failure or refusal
continues uncured for fifteen (15) days after receipt by Holder of written
notice from the Company identifying such failure or refusal with reasonable
specificity and demanding immediate cure thereof;

 

(b)           Holder’s material and intentional or grossly negligent breach of
Holder’s fiduciary duty of care to the Company or Holder’s willful or grossly
negligent breach of Holder’s fiduciary duty of loyalty to the Company, which, in
either case, results in material injury to the Company or any of its
shareholders;

 

(c)           Holder’s conviction or entry of a plea of guilty or no contest to
any crime for which imprisonment is a possibility or that results in a monetary
fine or penalty payment by Company; or

 

(d)           Any violation of a law or regulation carried out by or at the
direction of Holder acting knowingly that results in payment by the Company of a
fine, penalty or forfeiture in excess of Fifty Thousand dollars ($50,000.00) or
a civil damages judgment of One Million dollars ($1,000,000.00) or more.

 

1.2           INCORPORATION OF TERMS OF PLAN. THE SHARES ARE SUBJECT TO THE
TERMS AND CONDITIONS OF THE PLAN WHICH ARE INCORPORATED HEREIN BY REFERENCE.

 

ARTICLE II

GRANT OF RESTRICTED STOCK

 

2.1           GRANT OF RESTRICTED STOCK. IN CONSIDERATION OF HOLDER’S PAST
AND/OR CONTINUED SERVICE TO THE COMPANY OR ITS SUBSIDIARIES AND FOR OTHER GOOD
AND VALUABLE CONSIDERATION, EFFECTIVE AS OF THE GRANT DATE SET FORTH IN THE
GRANT NOTICE (THE “GRANT DATE”), THE COMPANY HEREBY AGREES TO ISSUE TO HOLDER
THE SHARES, UPON THE TERMS AND CONDITIONS SET FORTH IN THE PLAN, THE GRANT
NOTICE AND THIS AGREEMENT.

 

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2.2           ISSUANCE OF SHARES. THE ISSUANCE OF THE SHARES UNDER THIS
AGREEMENT SHALL OCCUR AT THE PRINCIPAL OFFICE OF THE COMPANY SIMULTANEOUSLY WITH
THE EXECUTION OF THE GRANT NOTICE BY THE PARTIES OR ON SUCH OTHER DATE AS THE
COMPANY AND HOLDER SHALL AGREE (THE “ISSUANCE DATE”). SUBJECT TO THE PROVISIONS
OF ARTICLE IV, THE COMPANY SHALL ISSUE THE SHARES (WHICH SHALL BE ISSUED IN
HOLDER’S NAME) ON THE ISSUANCE DATE.

 

2.3           CONDITIONS TO ISSUANCE OF STOCK CERTIFICATES. THE SHARES, OR ANY
PORTION THEREOF, MAY BE EITHER PREVIOUSLY AUTHORIZED BUT UNISSUED SHARES OR
ISSUED SHARES WHICH HAVE THEN BEEN REACQUIRED BY THE COMPANY. SUCH SHARES SHALL
BE FULLY PAID AND NONASSESSABLE. THE COMPANY SHALL NOT BE REQUIRED TO ISSUE OR
DELIVER ANY SHARES PRIOR TO FULFILLMENT OF ALL OF THE FOLLOWING CONDITIONS:

 

(a)         The admission of such Shares to listing on all stock exchanges on
which the Stock is then listed;

 

(b)         The completion of any registration or other qualification of such
Shares under any state or federal law or under rulings or regulations of the
Securities and Exchange Commission or of any other governmental regulatory body,
which the Board shall, in its absolute discretion, deem necessary or advisable;

 

(c)         The obtaining of any approval or other clearance from any state or
federal governmental agency which the Board shall, in its absolute discretion,
determine to be necessary or advisable;

 

(d)         The lapse of such reasonable period of time following the Issuance
Date as the Board may from time to time establish for reasons of administrative
convenience; and

 

(e)         The receipt by the Company of full payment for all amounts (if any)
which, under federal, state or local tax law, the Company (or other employer
corporation) is required to withhold upon issuance of such Shares.

 

2.4           RIGHTS AS STOCKHOLDER. EXCEPT AS OTHERWISE PROVIDED HEREIN, UPON
DELIVERY OF THE SHARES TO THE ESCROW AGENT PURSUANT TO ARTICLE IV, HOLDER SHALL
HAVE ALL THE RIGHTS OF A STOCKHOLDER WITH RESPECT TO SAID SHARES, SUBJECT TO THE
RESTRICTIONS HEREIN, INCLUDING THE RIGHT TO VOTE THE SHARES AND TO RECEIVE ALL
DIVIDENDS OR OTHER DISTRIBUTIONS PAID OR MADE WITH RESPECT TO THE SHARES;
PROVIDED, HOWEVER, THAT ANY AND ALL EXTRAORDINARY CASH DIVIDENDS PAID ON SUCH
SHARES AND ANY AND ALL SHARES OF STOCK, CAPITAL STOCK OR OTHER SECURITIES OR
PROPERTY RECEIVED BY OR DISTRIBUTED TO HOLDER WITH RESPECT TO THE SHARES AS A
RESULT OF ANY STOCK DIVIDEND, STOCK SPLIT, REVERSE STOCK SPLIT,
RECAPITALIZATION, COMBINATION, RECLASSIFICATION, OR SIMILAR CHANGE IN THE
CAPITAL STRUCTURE OF THE COMPANY SHALL ALSO BE SUBJECT TO THE FORFEITURE
RESTRICTION (AS DEFINED IN SECTION 3.1) AND THE RESTRICTIONS ON TRANSFER IN
SECTION 3.5 UNTIL SUCH RESTRICTIONS ON THE UNDERLYING SHARES LAPSE OR ARE
REMOVED PURSUANT TO THIS AGREEMENT (OR, IF SUCH SHARES ARE NO LONGER
OUTSTANDING, UNTIL SUCH TIME AS SUCH SHARES WOULD HAVE BEEN RELEASED FROM THE
FORFEITURE RESTRICTION PURSUANT TO THIS AGREEMENT). IN ADDITION, IN THE EVENT OF
ANY MERGER, CONSOLIDATION, SHARE EXCHANGE OR REORGANIZATION AFFECTING THE
SHARES, INCLUDING, WITHOUT LIMITATION, A CHANGE IN CONTROL, THEN ANY NEW,
SUBSTITUTED OR ADDITIONAL SECURITIES OR OTHER PROPERTY (INCLUDING MONEY PAID
OTHER THAN AS A REGULAR CASH DIVIDEND) THAT IS BY REASON OF ANY SUCH TRANSACTION
RECEIVED WITH RESPECT TO, IN EXCHANGE FOR OR IN SUBSTITUTION OF THE SHARES SHALL
ALSO BE SUBJECT TO THE FORFEITURE RESTRICTION (AS DEFINED IN SECTION 3.1) AND
THE RESTRICTIONS ON TRANSFER IN SECTION 3.5 UNTIL SUCH RESTRICTIONS ON THE
UNDERLYING SHARES LAPSE OR ARE REMOVED PURSUANT TO THIS AGREEMENT (OR, IF SUCH
SHARES ARE NO LONGER OUTSTANDING, UNTIL SUCH TIME AS SUCH SHARES WOULD HAVE BEEN
RELEASED FROM THE FORFEITURE RESTRICTION PURSUANT TO THIS AGREEMENT). ANY SUCH
ASSETS OR OTHER SECURITIES RECEIVED BY OR DISTRIBUTED TO HOLDER WITH RESPECT TO,
IN EXCHANGE FOR OR IN

 

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substitution of any Unreleased Shares (as defined in Section 3.3) shall be
immediately delivered to the Company to be held in escrow pursuant to Section
4.1.

 

ARTICLE III

RESTRICTIONS ON SHARES

 

3.1           FORFEITURE RESTRICTION. SUBJECT TO THE PROVISIONS OF SECTION 3.2
AND 3.3, IF HOLDER HAS A TERMINATION OF EMPLOYMENT FOR ANY OR NO REASON, ALL OF
THE UNRELEASED SHARES (AS DEFINED IN SECTION 3.4) SHALL BE FORFEITED IMMEDIATELY
AND AUTOMATICALLY TRANSFERRED TO THE COMPANY WITHOUT FURTHER ACTION BY THE
COMPANY (THE “FORFEITURE RESTRICTION”); PROVIDED, HOWEVER, THAT FOR THIS
PURPOSE, (I) ANY TERMINATION OF HOLDER’S EMPLOYMENT BY THE COMPANY OR ANY OF ITS
SUBSIDIARIES THAT OCCURS ON OR AFTER THE PERFORMANCE PERIOD, BUT NOT LATER THAN
THE DATE THE ANNOUNCEMENT DATE, SHALL BE DEEMED TO HAVE OCCURRED ON THE FIRST
BUSINESS DAY AFTER THE ANNOUNCEMENT DATE, AND (II) ANY OTHER TERMINATION OF
HOLDER’S EMPLOYMENT BY REASON OF DEATH OR PERMANENT AND TOTAL DISABILITY THAT
OCCURS ON OR AFTER JULY 1 OF ANY YEAR DURING THE PERFORMANCE PERIOD, BUT NO
LATER THAN THE ANNOUNCEMENT DATE FOR THAT YEAR SHALL BE DEEMED TO HAVE OCCURRED
ON THE FIRST BUSINESS DAY AFTER SUCH ANNOUNCEMENT DATE. FURTHER, FOR THIS
PURPOSE, HOLDER’S EMPLOYMENT SHALL NOT BE TREATED AS TERMINATED IN THE CASE OF A
TRANSFER OF EMPLOYMENT WITHIN THE COMPANY AND ITS SUBSIDIARIES OR IN THE CASE OF
SICK LEAVE AND OTHER APPROVED LEAVES OF ABSENCE. UPON THE OCCURRENCE OF
FORFEITURE UNDER THIS SECTION 3.1, THE COMPANY SHALL BECOME THE LEGAL AND
BENEFICIAL OWNER OF THE SHARES BEING FORFEITED AND ALL RIGHTS AND INTERESTS
THEREIN OR RELATING THERETO AND THE COMPANY SHALL HAVE THE RIGHT TO RETAIN AND
TRANSFER TO ITS OWN NAME THE NUMBER OF SHARES BEING FORFEITED BY HOLDER. IN THE
EVENT ANY OF THE UNRELEASED SHARES ARE FORFEITED UNDER THIS SECTION 3.1, ANY
CASH, CASH EQUIVALENTS, ASSETS OR SECURITIES RECEIVED BY OR DISTRIBUTED TO
HOLDER WITH RESPECT TO, IN EXCHANGE FOR OR IN SUBSTITUTION OF SUCH SHARES AND
HELD BY THE ESCROW AGENT PURSUANT TO SECTION 4.1 AND THE JOINT ESCROW
INSTRUCTIONS SHALL BE PROMPTLY TRANSFERRED BY THE ESCROW AGENT TO THE COMPANY.

 

3.2           RELEASE OF SHARES FROM FORFEITURE RESTRICTION. SHARES SHALL BE
RELEASED FROM THE FORFEITURE RESTRICTION AS INDICATED IN THE GRANT NOTICE
EFFECTIVE AS OF THE DATE HOLDER RECEIVES WRITTEN THE WRITTEN NOTICE OF RELEASE
SET FORTH IN SECTION 3.6 BELOW. ANY OF THE SHARES RELEASED FROM THE FORFEITURE
RESTRICTION SHALL THEREUPON BE RELEASED FROM THE RESTRICTIONS ON TRANSFER UNDER
SECTION 3.5. IN THE EVENT ANY OF THE SHARES ARE RELEASED FROM THE FORFEITURE
RESTRICTION, ANY DIVIDENDS OR OTHER DISTRIBUTIONS PAID ON SUCH SHARES AND HELD
BY THE ESCROW AGENT PURSUANT TO SECTION 4.1 AND THE JOINT ESCROW INSTRUCTIONS
SHALL BE PROMPTLY PAID BY THE ESCROW AGENT TO HOLDER.

 

3.3           OTHER RELEASE OF SHARES FROM FORFEITURE RESTRICTION.
NOTWITHSTANDING SECTION 3.2 ABOVE, ALL UNRELEASED SHARES SHALL BE RELEASED AND
VEST IMMEDIATELY UPON TERMINATION OF HOLDER’S EMPLOYMENT WITHOUT CAUSE WITHIN
180 DAYS AFTER A CHANGE IN CONTROL AND ON OR BEFORE THE ANNOUNCEMENT DATE OR
HOLDER’S VOLUNTARY RESIGNATION OF EMPLOYMENT WITHIN 180 DAYS AFTER A CHANGE IN
CONTROL AND ON OR BEFORE THE ANNOUNCEMENT DATE.

 

3.4           UNRELEASED SHARES. ANY OF THE SHARES WHICH, FROM TIME TO TIME,
HAVE NOT YET BEEN RELEASED FROM THE FORFEITURE RESTRICTION ARE REFERRED TO
HEREIN AS “UNRELEASED SHARES.”  TO THE EXTENT THAT THERE ARE ANY UNRELEASED
SHARES REMAINING AFTER THE ANNOUNCEMENT DATE, SUCH UNRELEASED SHARES SHALL BE
FORFEITED AND TRANSFERRED TO THE COMPANY AS SOON AS PRACTICABLE FOLLOWING SUCH
ANNOUNCEMENT DATE.

 

3.5           RESTRICTIONS ON TRANSFER. UNLESS OTHERWISE PERMITTED BY THE BOARD
PURSUANT TO THE PLAN, NO UNRELEASED SHARES OR ANY DIVIDENDS OR OTHER
DISTRIBUTIONS THEREON OR ANY INTEREST OR RIGHT THEREIN OR PART THEREOF, SHALL BE
LIABLE FOR THE DEBTS, CONTRACTS OR ENGAGEMENTS OF HOLDER OR HIS OR HER
SUCCESSORS IN INTEREST OR SHALL BE SUBJECT TO SALE OR OTHER DISPOSITION BY
TRANSFER, ALIENATION, ANTICIPATION, PLEDGE, ENCUMBRANCE, ASSIGNMENT OR ANY OTHER
MEANS WHETHER SUCH SALE OR OTHER DISPOSITION BE VOLUNTARY OR

 

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INVOLUNTARY OR BY OPERATION OF LAW BY JUDGMENT, LEVY, ATTACHMENT, GARNISHMENT OR
ANY OTHER LEGAL OR EQUITABLE PROCEEDINGS (INCLUDING BANKRUPTCY), EXCEPT BY WILL
OR BY THE LAWS OF DESCENT AND DISTRIBUTION, OR TO A MEMBER OF HOLDER’S IMMEDIATE
FAMILY OR, PROVIDED THAT THE TRANSFEREE AGREES IN WRITING, IN A FORM PROVIDED BY
THE COMPANY TO BE BOUND BY ALL PROVISIONS OF THIS AGREEMENT, A TRUST OR FAMILY
PARTNERSHIP OR ANY OTHER ENTITY CUSTOMARILY USED FOR ESTATE PLANNING PURPOSES.
ANY ATTEMPTED SALE OR OTHER DISPOSITION OF UNRELEASED SHARES CONTRARY TO THE
FOREGOING RESTRICTIONS ON TRANSFER SHALL BE NULL AND VOID AND OF NO EFFECT.

 

3.6           NOTICE OF RELEASE. THE COMMITTEE SHALL PROVIDE WRITTEN NOTICE TO
HOLDER OF WHETHER, AND THE EXTENT TO WHICH, ANY OF THE SHARES BECAME VESTED AND
RELEASED IN ACCORDANCE WITH SECTION 3.2 ABOVE FOR EACH CALENDAR YEAR DURING THE
PERFORMANCE PERIOD OR SECTION 3.3 ABOVE. SUCH NOTICE SHALL BE PROVIDED AS SOON
AS ADMINISTRATIVELY PRACTICABLE AFTER AUDITED FINANCIAL STATEMENTS ARE AVAILABLE
FOR SUCH CALENDAR YEAR AND THE COMMITTEE HAS CERTIFIED IN WRITING THE EXTENT TO
WHICH THE APPLICABLE PERFORMANCE GOALS SET FORTH IN THE GRANT NOTICE WERE
ACHIEVED.

 

ARTICLE IV

ESCROW OF SHARES

 

4.1           ESCROW OF SHARES. TO INSURE THE AVAILABILITY FOR DELIVERY OF
HOLDER’S UNRELEASED SHARES IN THE EVENT OF FORFEITURE OF SUCH SHARES BY HOLDER
PURSUANT TO SECTIONS 3.1 OR 3.4, HOLDER HEREBY APPOINTS THE SECRETARY OF THE
COMPANY, OR ANY OTHER PERSON DESIGNATED BY THE BOARD AS ESCROW AGENT, AS HIS OR
HER ATTORNEY-IN-FACT TO ASSIGN AND TRANSFER UNTO THE COMPANY, SUCH UNRELEASED
SHARES, IF ANY, FORFEITED BY HOLDER PURSUANT TO SECTIONS 3.1 OR 3.4 AND ANY
DIVIDENDS OR OTHER DISTRIBUTIONS THEREON, AND SHALL, UPON EXECUTION OF THIS
AGREEMENT, DELIVER AND DEPOSIT WITH THE SECRETARY OF THE COMPANY, OR SUCH OTHER
PERSON DESIGNATED BY THE BOARD, ANY SHARE CERTIFICATES REPRESENTING THE
UNRELEASED SHARES, TOGETHER WITH THE STOCK ASSIGNMENT DULY ENDORSED IN BLANK,
ATTACHED AS EXHIBIT B TO THE GRANT NOTICE. THE UNRELEASED SHARES AND STOCK
ASSIGNMENT SHALL BE HELD BY THE SECRETARY OF THE COMPANY, OR SUCH OTHER PERSON
DESIGNATED BY THE BOARD, IN ESCROW, PURSUANT TO THE JOINT ESCROW INSTRUCTIONS OF
THE COMPANY AND HOLDER ATTACHED AS EXHIBIT C TO THE GRANT NOTICE, UNTIL THE
UNRELEASED SHARES ARE FORFEITED BY HOLDER AS PROVIDED IN SECTIONS 3.1 OR 3.4,
UNTIL SUCH UNRELEASED SHARES ARE RELEASED FROM THE FORFEITURE RESTRICTION, OR
UNTIL SUCH TIME AS THIS AGREEMENT NO LONGER IS IN EFFECT. UPON RELEASE OF THE
UNRELEASED SHARES FROM THE FORFEITURE RESTRICTION, THE ESCROW AGENT SHALL
DELIVER TO HOLDER THE CERTIFICATE OR CERTIFICATES REPRESENTING SUCH SHARES IN
THE ESCROW AGENT’S POSSESSION BELONGING TO HOLDER IN ACCORDANCE WITH THE TERMS
OF THE JOINT ESCROW INSTRUCTIONS ATTACHED AS EXHIBIT C TO THE GRANT NOTICE, AND
THE ESCROW AGENT SHALL BE DISCHARGED OF ALL FURTHER OBLIGATIONS HEREUNDER;
PROVIDED, HOWEVER, THAT THE ESCROW AGENT SHALL NEVERTHELESS RETAIN SUCH
CERTIFICATE OR CERTIFICATES AS ESCROW AGENT IF SO REQUIRED PURSUANT TO OTHER
RESTRICTIONS IMPOSED PURSUANT TO THIS AGREEMENT. IF THE SHARES ARE HELD IN BOOK
ENTRY FORM, THEN SUCH ENTRY WILL REFLECT THAT THE SHARES ARE SUBJECT TO THE
RESTRICTIONS OF THIS AGREEMENT. IF ANY DIVIDENDS OR OTHER DISTRIBUTIONS ARE PAID
ON THE UNRELEASED SHARES HELD BY THE ESCROW AGENT PURSUANT TO THIS SECTION 4.1
AND THE JOINT ESCROW INSTRUCTIONS, SUCH DIVIDENDS OR OTHER DISTRIBUTIONS SHALL
ALSO BE SUBJECT TO THE RESTRICTIONS SET FORTH IN THIS AGREEMENT AND HELD IN
ESCROW PENDING RELEASE OF THE UNRELEASED SHARES WITH RESPECT TO WHICH SUCH
DIVIDENDS OR OTHER DISTRIBUTIONS WERE PAID FROM THE FORFEITURE RESTRICTION.

 

4.2           NOTICE OF FORFEITED SHARES; TRANSFER OF FORFEITED SHARES. THE
COMMITTEE SHALL PROVIDE WRITTEN NOTICE TO HOLDER OF WHETHER ANY OF THE SHARES
WERE PERMANENTLY FORFEITED FOR EACH CALENDAR YEAR DURING THE PERFORMANCE PERIOD.
SUCH NOTICE SHALL BE PROVIDED AS SOON AS ADMINISTRATIVELY PRACTICABLE AFTER
AUDITED FINANCIAL STATEMENTS ARE AVAILABLE FOR SUCH CALENDAR YEAR. HOLDER HEREBY
AUTHORIZES AND DIRECTS THE SECRETARY OF THE COMPANY, OR SUCH OTHER PERSON
DESIGNATED BY THE BOARD, TO TRANSFER THE UNRELEASED SHARES WHICH HAVE BEEN
FORFEITED BY HOLDER IMMEDIATELY TO THE COMPANY.

 

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4.3           NO LIABILITY FOR ACTIONS IN CONNECTION WITH ESCROW. THE COMPANY,
OR ITS DESIGNEE, SHALL NOT BE LIABLE FOR ANY ACT IT MAY DO OR OMIT TO DO WITH
RESPECT TO HOLDING THE SHARES IN ESCROW WHILE ACTING IN GOOD FAITH AND IN THE
EXERCISE OF ITS JUDGMENT.

 

ARTICLE V

OTHER PROVISIONS

 

5.1           ADJUSTMENT FOR STOCK SPLIT. IN THE EVENT OF ANY STOCK DIVIDEND,
STOCK SPLIT, REVERSE STOCK SPLIT, RECAPITALIZATION, COMBINATION,
RECLASSIFICATION, OR SIMILAR CHANGE IN THE CAPITAL STRUCTURE OF THE COMPANY, THE
BOARD SHALL MAKE APPROPRIATE AND EQUITABLE ADJUSTMENTS IN THE UNRELEASED SHARES
SUBJECT TO THE FORFEITURE RESTRICTION AND THE NUMBER OF SHARES, CONSISTENT WITH
ANY ADJUSTMENT UNDER SECTION 11.3 OF THE PLAN. THE PROVISIONS OF THIS AGREEMENT
SHALL APPLY, TO THE FULL EXTENT SET FORTH HEREIN WITH RESPECT TO THE SHARES, TO
ANY AND ALL SHARES OF CAPITAL STOCK OR OTHER SECURITIES, PROPERTY OR CASH WHICH
MAY BE ISSUED IN RESPECT OF, IN EXCHANGE FOR, OR IN SUBSTITUTION OF THE SHARES,
AND SHALL BE APPROPRIATELY ADJUSTED FOR ANY STOCK DIVIDENDS, SPLITS, REVERSE
SPLITS, COMBINATIONS, RECAPITALIZATIONS AND THE LIKE OCCURRING AFTER THE DATE
HEREOF.

 

5.2           TAXES. HOLDER HAS REVIEWED WITH HOLDER’S OWN TAX ADVISORS THE
FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES OF THIS INVESTMENT AND THE
TRANSACTIONS CONTEMPLATED BY THE GRANT NOTICE AND THIS AGREEMENT. HOLDER IS
RELYING SOLELY ON SUCH ADVISORS AND NOT ON ANY STATEMENTS OR REPRESENTATIONS OF
THE COMPANY OR ANY OF ITS AGENTS. HOLDER UNDERSTANDS THAT HOLDER (AND NOT THE
COMPANY) SHALL BE RESPONSIBLE FOR HOLDER’S OWN TAX LIABILITY THAT MAY ARISE AS A
RESULT OF THIS INVESTMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
HOLDER UNDERSTANDS THAT HOLDER WILL RECOGNIZE ORDINARY INCOME FOR FEDERAL INCOME
TAX PURPOSES UNDER SECTION 83 OF THE CODE AS THE RESTRICTIONS APPLICABLE TO THE
UNRELEASED SHARES LAPSE. IN THIS CONTEXT, “RESTRICTION” INCLUDES THE FORFEITURE
RESTRICTION. HOLDER UNDERSTANDS THAT HOLDER MAY ELECT TO BE TAXED FOR FEDERAL
INCOME TAX PURPOSES AT THE TIME THE SHARES ARE ISSUED RATHER THAN AS AND WHEN
THE FORFEITURE RESTRICTION LAPSES BY FILING AN ELECTION UNDER SECTION 83(B) OF
THE CODE WITH THE INTERNAL REVENUE SERVICE NO LATER THAN THIRTY DAYS FOLLOWING
THE DATE OF PURCHASE. A FORM OF ELECTION UNDER SECTION 83(B) OF THE CODE IS
ATTACHED TO THE GRANT NOTICE AS EXHIBIT D.

 

HOLDER ACKNOWLEDGES THAT IT IS HOLDER’S SOLE RESPONSIBILITY AND NOT THE
COMPANY’S TO TIMELY FILE THE ELECTION UNDER SECTION 83(B), EVEN IF HOLDER
REQUESTS THE COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON HOLDER’S
BEHALF.

 

5.3           LIMITATIONS APPLICABLE TO SECTION 16 PERSONS. NOTWITHSTANDING ANY
OTHER PROVISION OF THE PLAN OR THIS AGREEMENT, THE PLAN, THE SHARES AND THIS
AGREEMENT SHALL BE SUBJECT TO ANY ADDITIONAL LIMITATIONS SET FORTH IN ANY
APPLICABLE EXEMPTIVE RULE UNDER SECTION 16 OF THE EXCHANGE ACT (INCLUDING ANY
AMENDMENT TO RULE 16B-3 OF THE EXCHANGE ACT) THAT ARE REQUIREMENTS FOR THE
APPLICATION OF SUCH EXEMPTIVE RULE. TO THE EXTENT PERMITTED BY APPLICABLE LAW,
THIS AGREEMENT SHALL BE DEEMED AMENDED TO THE EXTENT NECESSARY TO CONFORM TO
SUCH APPLICABLE EXEMPTIVE RULE.

 

5.4           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
BINDING, CONCLUSIVE AND FINAL UPON HOLDER, 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,
THIS AGREEMENT OR THE SHARES.

 

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5.5           RESTRICTIVE LEGENDS AND STOP-TRANSFER ORDERS.

 

(a)         Any share certificate(s) evidencing the Shares issued hereunder
shall be endorsed with the following legend and any other legend(s) that may be
required by any applicable federal or state securities laws:

 

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO FORFEITURE IN FAVOR OF
THE COMPANY AND MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF A
RESTRICTED STOCK AWARD AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY
OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.

 

(b)         Holder agrees that, in order to ensure compliance with the
restrictions referred to herein, the Company may issue appropriate “stop
transfer” instructions to its transfer agent, if any, and that, if the Company
transfers its own securities, it may make appropriate notations to the same
effect in its own records.

 

(c)         The Company shall not be required: (i) to transfer on its books any
Shares that have been sold or otherwise transferred in violation of any of the
provisions of this Agreement, or (ii) to treat as owner of such Shares or to
accord the right to vote or pay dividends to any purchaser or other transferee
to whom such Shares shall have been so transferred.

 

5.6           TAX WITHHOLDING.

 

(a)         The Company shall be entitled to require payment of any sums
required by federal, state or local tax law to be withheld with respect to the
transfer of the Shares or the lapse of the Forfeiture Restriction with respect
to the Shares, or any other taxable event related thereto. The Company may
permit Holder to make such payment in one or more of the forms specified below:

 

(i)            by cash or check made payable to the Company;

 

(ii)           by the deduction of such amount from other compensation payable
to Holder;

 

(iii)          by tendering Shares which are not subject to the Forfeiture
Restriction and which have a then current Fair Market Value not greater than the
amount necessary to satisfy the Company’s withholding obligation based on the
minimum statutory withholding rates for federal, state and local income tax and
payroll tax purposes; or

 

(iv)          in any combination of the foregoing.

 

(b)           In the event Holder fails to provide timely payment of all sums
required by the Company pursuant to Section 5.6(a), the Company shall have the
right and option, but not obligation, to treat such failure as an election by
Holder to provide all or any portion of such required payment by means of
tendering Shares in accordance with Section 5.6(a)(iii).

 

5.7           NOTICES. ANY NOTICE TO BE GIVEN UNDER THE TERMS OF THIS AGREEMENT
TO THE COMPANY SHALL BE ADDRESSED TO THE COMPANY IN CARE OF THE SECRETARY OF THE
COMPANY, AND ANY NOTICE TO BE GIVEN TO HOLDER SHALL BE ADDRESSED TO HOLDER AT
THE ADDRESS GIVEN BENEATH HOLDER’S SIGNATURE ON THE GRANT NOTICE. BY A NOTICE
GIVEN PURSUANT TO THIS SECTION 5.7, EITHER PARTY MAY HEREAFTER DESIGNATE A
DIFFERENT ADDRESS FOR NOTICES TO BE GIVEN TO THAT PARTY. ANY NOTICE SHALL BE
DEEMED DULY GIVEN WHEN SENT VIA EMAIL OR WHEN SENT

 

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BY CERTIFIED MAIL (RETURN RECEIPT REQUESTED) AND DEPOSITED (WITH POSTAGE
PREPAID) IN A POST OFFICE OR BRANCH POST OFFICE REGULARLY MAINTAINED BY THE
UNITED STATES POSTAL SERVICE.

 

5.8           TITLES. TITLES ARE PROVIDED HEREIN FOR CONVENIENCE ONLY AND ARE
NOT TO SERVE AS A BASIS FOR INTERPRETATION OR CONSTRUCTION OF THIS AGREEMENT.

 

5.9           GOVERNING LAW; SEVERABILITY. THIS AGREEMENT SHALL BE ADMINISTERED,
INTERPRETED AND ENFORCED UNDER THE LAWS OF THE STATE OF HAWAII WITHOUT REGARD TO
CONFLICTS OF LAWS THEREOF. SHOULD ANY PROVISION OF THIS AGREEMENT BE DETERMINED
BY A COURT OF LAW TO BE ILLEGAL OR UNENFORCEABLE, THE OTHER PROVISIONS SHALL
NEVERTHELESS REMAIN EFFECTIVE AND SHALL REMAIN ENFORCEABLE.

 

5.10         CONFORMITY TO SECURITIES LAWS. HOLDER ACKNOWLEDGES THAT THE PLAN IS
INTENDED TO CONFORM TO THE EXTENT NECESSARY WITH ALL PROVISIONS OF THE
SECURITIES ACT AND THE EXCHANGE ACT AND ANY AND ALL REGULATIONS AND RULES
PROMULGATED BY THE SECURITIES AND EXCHANGE COMMISSION THEREUNDER, AND STATE
SECURITIES LAWS AND REGULATIONS. NOTWITHSTANDING ANYTHING HEREIN TO THE
CONTRARY, THE PLAN SHALL BE ADMINISTERED, AND THE SHARES ARE TO BE ISSUED, ONLY
IN SUCH A MANNER AS TO CONFORM TO SUCH LAWS, RULES AND REGULATIONS. TO THE
EXTENT PERMITTED BY APPLICABLE LAW, THE PLAN AND THIS AGREEMENT SHALL BE DEEMED
AMENDED TO THE EXTENT NECESSARY TO CONFORM TO SUCH LAWS, RULES AND REGULATIONS.

 

5.11         AMENDMENTS. THIS AGREEMENT MAY NOT BE MODIFIED, AMENDED OR
TERMINATED EXCEPT BY AN INSTRUMENT IN WRITING, SIGNED BY HOLDER AND BY A DULY
AUTHORIZED REPRESENTATIVE OF THE COMPANY.

 

5.12         SUCCESSORS AND ASSIGNS. THE COMPANY MAY ASSIGN ANY OF ITS RIGHTS
UNDER THIS AGREEMENT TO SINGLE OR MULTIPLE ASSIGNEES, AND THIS AGREEMENT SHALL
INURE TO THE BENEFIT OF THE SUCCESSORS AND ASSIGNS OF THE COMPANY. SUBJECT TO
THE RESTRICTIONS ON TRANSFER HEREIN SET FORTH, THIS AGREEMENT SHALL BE BINDING
UPON HOLDER AND HIS OR HER HEIRS, EXECUTORS, ADMINISTRATORS, SUCCESSORS AND
ASSIGNS.

 

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