ex10-44restshragmtgj.htm


    Borders
Group, Inc.

    2004
Long-Term Incentive Plan

    


    Restricted Share Grant
Agreement

    


    This
Restricted Share Grant Agreement (the “Agreement”), dated as of April 2, 2008
(the “Grant Date”), is made by and between Borders Group, Inc. (the “Company”)
and George Jones (the
“Participant”).

     

    RECITALS

     

    WHEREAS,
the Company has established and maintains the Borders Group, Inc. 2004 Long-Term
Incentive Plan (the “Plan”);

     

    WHEREAS,
the Participant is a key employee of the Company;

     

    WHEREAS,
the Company desires to grant to the Participant shares of common stock (“Common
Stock”) under the Plan, subject to certain restrictions and limitations;
and

     

    WHEREAS,
the Participant desires to receive a grant of such shares from the
Company;

     

    NOW,
THEREFORE, in consideration of the promises and mutual agreements contained
herein, the adequacy and sufficiency of which are hereby acknowledged, the
Company and the Participant agree as follows:

     

    1.           Grant of Restricted
Shares.

     

    (a)           Number of
Shares/Vesting.  The Company hereby grants to the Participant
461,148 shares of Common Stock under the Plan, subject to the terms and
conditions set forth below (the “Restricted Shares”).  The Restricted
Shares shall be subject to the following vesting conditions:  A number
of Restricted Shares equal to the Performance-Earned Amount (as defined below)
shall vest on April 2, 2011, subject to the Participant’s continued employment
with the Company and its Subsidiaries through such date, and any Restricted
Shares outstanding on April 2, 2011 in excess of the Performance-Earned Amount
shall be forfeited by the Participant and cancelled by the
Company.  Subject to Section 1(b), upon the Participant’s termination
of employment with the Company and its Subsidiaries prior to April 2, 2011, all
Restricted Shares shall be forfeited by the Participant and cancelled by the
Company; provided, however,
that if the Participant’s termination of employment is due to his death or
Disability (and occurs prior to a Change of Control), then a number of
Restricted Shares equal to the product of (x) the Performance-Earned Amount
(determined as of the date of such termination), multiplied by (y) a fraction,
the numerator of which is the number of days elapsed from April 2, 2008
through  the date of such termination, and the denominator of which is
1095, shall vest in full.  Section 12 of the Plan shall not apply to a
termination due to Retirement.

     

    (b)           In
the event of a Change of Control prior to the Participant’s termination of
employment with the Company and its Subsidiaries, a number of Restricted Shares
equal to the Performance-Earned Amount (determined as of such Change of Control)
shall vest in full; provided, however,
that no Restricted Shares shall vest upon a Change of Control in the event that
the Restricted Shares are replaced by a Qualifying Replacement Award (as defined
below).  A Qualifying Replacement Award shall mean an award of
publicly traded restricted shares of the Company or its successor in the Change
of Control (or of the appropriate affiliate of such successor) that (i) has a
value, as of such replacement, that is at least equal to the value of the
Restricted Shares, (ii) is subject to the same time-vesting schedule and terms
as the Restricted Shares, (iii) provides that a portion of the restricted shares
equal to the Performance-Earned Amount determined as of the date of termination
of employment with the Company or its successor in the Change of Control (or of
the appropriate affiliate of such successor) (as adjusted to reflect conversion
into the shares subject to the Qualifying Replacement Award) shall vest in the
event of a termination of the Participant’s employment prior to April 2, 2011
that is (1) by the Company other than for Cause (as defined in the Plan, unless
Cause is defined in an individual employment or severance agreement to which the
Participant is party, in which case such definition shall apply), (2) by the
Participant for Good Reason (within the meaning of Section 1(f)), or (3) due to
the Participant’s death or Disability, and (iv) otherwise contains terms and
conditions substantially similar to, and in any event no less favorable to the
Participant than, the terms and conditions of the Restricted
Shares.  Without limiting the generality of the foregoing, a
Qualifying Replacement Award may take the form of a continuation of this
Restricted Share award if the requirements of the preceding sentence are
satisfied.  For the avoidance of doubt, if a Qualifying Replacement
Award vests following a Change of Control due to continued service through April
2, 2011, the number of shares earned shall equal the Performance-Earned Amount
determined as of April 2, 2011 (as adjusted to reflect conversion into the
shares subject to the Qualifying Replacement Award).

     

    (c)           Determination of
Performance-Earned Amount.   The Performance-Earned Amount
shall be determined based upon the highest volume-weighted average trading price
of a share of Common Stock (or, following a Change of Control, a number or
fraction of shares subject to the Qualifying Replacement Award equal to the
value of one share of Common Stock at the time of the Change of Control) over
any period of 10 consecutive trading days (such price, the “Highest Average
Price”) occurring between April 2, 2008 and the first to occur of April 2, 2011
or the termination of employment with the Company or its successor in the Change
of Control (or of the appropriate affiliate of such successor), in accordance
with the matrix set forth below.  The Highest Average Price targets
set forth in the matrix below may be appropriately adjusted by the Committee in
its discretion in the event of the occurrence of an event described in Section
16 of the Plan.

     

    
      	
              Highest
      Average Price per Share of Common Stock

            	
              Performance-Earned
      Amount

            
	
              Below
      $7.50

            	
              0

            
	
              At
      or above $7.50 but below $10.00

            	
              211,148

            
	
              At
      or above $10.00 but below $12.50

            	
              294,482

            
	
              At
      or above $12.50 but below $15.00

            	
              377,815

            
	
              $15.00
      or more

            	
              461,148

            


    

    


     

    (d)           Additional
Documents/Capitalized Terms.  The Participant agrees to execute
such additional documents and forms as the Company may require for purposes of
this Agreement.  Any capitalized terms not defined herein shall have
the same meaning as set forth in the Plan document.

     

    (e)           Issuance of Restricted
Shares.  As soon as practicable following receipt of this
executed Agreement, the Company shall issue on behalf of the Participant the
number of Restricted Shares that the Participant has been
granted.  Such Restricted Shares, which shall be fully paid and
nonassessable upon their issuance, shall be represented by a certificate or
certificates registered in the name of the Participant and stamped with an
appropriate legend evidencing the nature of the Restricted
Shares.  The certificates shall be held by the Company or such other
custodian as may be designated by the Company as a depository for safekeeping
until the forfeiture restrictions lapse pursuant to the terms of this Agreement.
The Participant shall execute such additional documents and forms as the Company
may require for these purposes.  Subject to the terms and provisions
of Michigan law, the Participant shall have all the rights of a stockholder upon
the issuance of the Restricted Shares, including the right to vote the
Restricted Shares and to receive all dividends or other distributions paid or
made with respect to the Restricted Shares, provided that the Restricted Shares
shall be subject to the restrictions set forth in this Agreement.

     

    (f)      Good Reason
Termination.  For purposes of Section 1(b), a termination shall
be deemed to be for “Good Reason” if such termination is (i) effectuated
pursuant to a “good reason” or similar constructive termination right in an
individual employment or severance agreement to which the Participant is party,
or (ii) if the Participant is not party to any such agreement, initiated by the
Participant following the occurrence of any of the following: (1) an involuntary
relocation that increases the Participant’s commute by more than 35 miles, (2) a
material reduction in either the Participant’s base pay or the Participant’s
overall compensation opportunity from the levels in effect immediately prior to
the Change of Control, or (3) a material reduction in the Participant’s
authority, duties, or responsibilities below the levels in effect immediately
prior to the Change of Control.  Notwithstanding the foregoing, a
termination shall be deemed to be for Good Reason under clause (ii) of this
Section 1(f) only if the Participant provides written notice to the Company of
the existence of one or more of the conditions described therein within 90 days
following the Participant’s knowledge of the initial existence of such
condition, the Company fails to cure such condition during the 30-day period
(the “Cure Period”) following its receipt of such notice, and the Participant
terminates employment within 180 days following the conclusion of the Cure
Period.

     

    2.           Restrictions on
Transfer.  Until the Restricted Shares are vested in accordance
with Section 1 of this Agreement, the Restricted Shares held by the Participant
(and any other securities issued in respect of the Restricted Shares) may not be
sold, exchanged, assigned, transferred, conveyed, gifted, delivered, encumbered,
discounted, pledged, hypothecated, or otherwise disposed of, whether
voluntarily, involuntarily, or by operation of law.

     

    3.           Withholding.  The
Participant shall be liable for any and all U.S. federal, state or local taxes
of any kind required by law to be withheld with respect to the vesting of
Restricted Shares.  When the Restricted Shares vest, the Participant
shall surrender to the Company a sufficient number of whole shares of Common
Stock as necessary to cover all applicable required withholding taxes and social
security contributions related to such vesting.  The Company will
provide the Participant with a cash refund for any fraction of surrendered
shares of Common Stock not necessary for required withholding taxes and social
security contributions.  Instead of requiring the Participant to
surrender shares as described above, the Company may, in its discretion, (a)
require the Participant to remit to the Company on the date on which the
Restricted Shares vest cash in an amount sufficient to satisfy all applicable
required withholding taxes and social security contributions related to such
vesting, or (b) deduct from his regular salary payroll cash, on a payroll date
following the date on which the Restricted Shares vest, in an amount sufficient
to satisfy such obligations.

     

    4.           Grant Subject to Plan
Provisions.  The grant of Restricted Shares is made pursuant to
the Plan, the terms of which are incorporated herein by reference, and in all
respects will be interpreted in accordance with the Plan.  The
Committee has the authority to interpret and construe this Agreement pursuant to
the terms of the Plan, and its decisions are conclusive as to any questions
arising hereunder.  In the event of any conflict between the terms of
this Agreement and the terms of the Plan, the terms of the Plan shall
control.  For purposes of the Plan, 200,000 of the 211,148 Restricted
Shares subject to a Highest Average Price hurdle of $7.50 have been designated
as Awards subject to the attainment of performance criteria in order to protect
against the loss of deductibility under Section 162(m) of the Code, and the
remaining Restricted Shares have not been so designated.

     

    5.           Notification of Election
Under Section 83(b) of the Code.  If the Participant shall, in
connection with the grant of Restricted Shares under this Agreement, make the
election permitted under Section 83(b) of the Internal Revenue Code (i.e., an election to include
in gross income in the year of transfer the amounts specified in Section 83(b)
of the Internal Revenue Code), then the Participant shall notify the Company of
such election within 10 days of filing notice of the election with the Internal
Revenue Service.

     

    6.           No Employment or Other
Rights.  The grant of Restricted Shares does not confer upon
the Participant any right to be employed by the Company or any Subsidiary and
will not interfere in any way with the right of the Company or any Subsidiary to
terminate the Participant’s employment at any time.  The right of the
Company or any Subsidiary to terminate the Participant’s employment at will at
any time for any reason is specifically reserved.  The Participant
will not have any interest in any fund or specific assets of the Company by
reason of this grant.

     

    7.           Nontransferability.  Except
for tax withholding, the Participant’s rights and interests under this Agreement
may not be sold, transferred, assigned, pledged or otherwise encumbered or
disposed of except, in the event of the Participant’s death, by will or by the
laws of descent and distribution.

     

    8.           Applicable
Law.  The validity, construction, interpretation and effect of
this instrument will be governed by and construed in accordance with the laws of
the State of Michigan, without giving effect to the conflicts of laws provisions
thereof.

     

    9.           Notice.  Any
notice to the Company or the Committee provided for in this Agreement shall be
addressed to Borders Group, Inc. in care of The Secretary, Borders Group, Inc., 100 Phoenix Dr.,
Ann Arbor, MI 48108 and any notice to the Participant will be addressed
to the Participant at the current address shown on the books and records of the
Company or its Subsidiary.  Any notice shall be sent by registered or
certified mail.

     

    10.           Discretionary Nature of
Plan.  The Plan is discretionary in nature, and the Company may
suspend, modify, amend or terminate the Plan in its sole discretion at any time,
subject to the terms of the Plan and any applicable limitations imposed by
law.  This Restricted Share grant under the Plan is a one-time benefit
and does not create any contractual or other right to receive additional
Restricted Shares or other benefits in lieu of Restricted Shares in the
future.  Future grants, if any, will be at the sole discretion of the
Committee, including, but not limited to, the timing of any grant, the number of
Restricted Shares granted, and the vesting provisions.

     

    11.           Entire
Agreement.  This Agreement and the Plan contain the entire
agreement between the Participant and the Company regarding the grant of
Restricted Shares and supersede all prior arrangements or understandings with
respect thereto.

     

    IN
WITNESS WHEREOF, the Company has caused this Agreement to be executed by a duly
authorized representative and the Participant has hereunto set his hand
effective as of the Grant Date.

    


    Borders
Group, Inc.

    


    By:                                                      

    Its:
Executive Vice President, Human Resources

    As of:
April 2, 2008

     

    I hereby
accept the Restricted Shares granted pursuant to this Agreement, and I agree to
be bound by the terms of the Plan and this Agreement.  I hereby
further agree that all the decisions and determinations of the Committee will be
final and binding.

    


    


    Participant                                               Date

    


    CHIDMS1/2512118.2


    
      
        
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