exv10w38



 





EXHIBIT 10.38




FORM OF RESTRICTED STOCK AGREEMENT

(NON-EMPLOYEE DIRECTOR VERSION as of MAY 2007)




     THIS RESTRICTED STOCK AGREEMENT is made the ___day of ___(the “Grant Date”) by
and between Citizens Republic Bancorp, Inc. (“Company”) and the undersigned (“Grantee”), pursuant
to the Citizens Banking Corporation Stock Compensation Plan (“Plan”). Capitalized terms not
defined in this Agreement shall have the meanings respectively ascribed to them in the Plan.



     WHEREAS, the Company desires to encourage the Grantee to make greater efforts on behalf of the
Company and its Affiliates to achieve the Company’s long-term business plans and objectives and to
further identify the interests of Grantee with the interests of the Company’s shareholders;



     WHEREAS, the Company desires to grant this restricted stock award to the Grantee pursuant to
the Plan;



     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, it is agreed between the parties as follows:



     1. Grant of Restricted Stock Award. Subject to the terms and conditions hereof,
including without limitation the restrictions set forth in Section 2(a) of this Agreement, the
Company hereby grants to the Grantee a total of ___shares of the Company’s Common Stock.



     2. Restrictions on Transfer of Shares Subject to Award.



          (a) The shares subject to this restricted stock award shall not be transferred, pledged,
assigned, or otherwise alienated or hypothecated until the first to occur of the events set forth
in this paragraph 2(a), at which time such restrictions shall lapse and the applicable number of
shares subject to this restricted stock award shall be freely transferable. Except as set forth
below, the restrictions on the shares subject to this restricted stock award shall lapse as
follows, if Grantee is still serving as a director of the Company or an Affiliate on the applicable
date(s):



	 	 	 
	 	 	Percentage of Award
	Period After Grant Date	 	As to Which Restrictions Lapse
	One Year Anniversary
	 	331/3%
	Two Year Anniversary
	 	662/3%
	Three Year Anniversary
	 	100%





Restrictions shall be deemed to lapse at the close of business on the applicable vesting date.
Notwithstanding the foregoing, in the event of Grantee’s (i) death, or (ii) Disability, the
restrictions on the shares subject to this restricted stock award shall lapse on a pro-rata portion
of Grantee’s shares equal to the product of (i) the number of shares subject to vesting on the next
anniversary of the Grant Date and (ii) a fraction, the numerator of which is the number of days
that have elapsed from the previous vesting date through the date of such occurrence, and the
denominator of which is 365. Upon the lapse of such restrictions, the shares subject to this
restricted stock award shall be freely transferable. If Grantee’s tenure as a director of the
Company or its Affiliates terminates other than under the circumstances described above in this
paragraph 2(a), any portion of the restricted stock award as to which such restrictions have not
lapsed at the time of such termination shall be forfeited.




          (b) Until the lapse of all restrictions provided in paragraph 2(a) on the shares subject to
this restricted stock award, any certificate evidencing the shares subject to the award shall carry
the following restrictive legend:




The sale or other transfer of the shares of stock represented by this
certificate, whether voluntary, involuntary or by operation of law, is
subject to certain restrictions on transfer set forth in the Citizens
Banking Corporation Stock Compensation Plan (the “Plan”), rules and
administrative guidelines adopted pursuant to such Plan and an Agreement
dated ___. A copy of the Plan, such rules and such
Agreement may be obtained from the Secretary of the Company.



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The Company shall also have the right to place stop transfer instructions on shares which are
subject to the restrictions described in paragraph 2(a). Grantee shall be entitled to removal of
such legend and stop transfer instructions at the time or times provided by, and in accordance
with, Section 3.05 of the Plan.




     3. Restrictive Covenants.



     As consideration for the grant of this Award, Grantee agrees to comply with and be bound by
the following restrictive covenants:



          (a) Non-Disclosure of Confidential Information. All “confidential information”
concerning Company and its customers will be kept strictly confidential and will not be disclosed
by Grantee to any third parties or used by Grantee in a manner contrary to Company’s interests at
any time without the prior consent of Company, except as required by law. “Confidential
information” includes customer and client lists and all customer, technical, business, marketing,
financial, systems and personnel information from whatever source, the disclosure of which might be
contrary to the interests of Company, excluding information which is or becomes publicly available
other than by Grantee’s acts or omissions. All confidential information and all other property of
Company will be returned to Company on or before the date Grantee’s active status terminates, and
Grantee will not retain any copies in any form.



          (b) Non-Solicitation of Employees and Customers. During Grantee’s term of office as a
non-employee director and for a period of one year following Termination of such office for any
reason, including Retirement, Grantee will not, without the prior written consent of Company:



               (i) on his/her own behalf or on behalf of any third party, whether directly or indirectly,
hire or employ, attempt to hire or employ, or solicit, encourage or induce to leave employment with
Company or to accept employment elsewhere than Company, any person who was employed by Company at
any time during the 18-month period beginning six months prior to the termination of Grantee’s
office as a non-employee director and ending one year after such termination.



               (ii) on his/her own behalf or on behalf of any third party, whether directly or indirectly,
provide, sell, market or endeavor to provide, sell or market any Competing Services to any
Restricted Customers (as such terms are defined below), or otherwise solicit or communicate with
any Restricted Customers for the purpose of selling or providing any Competing Services.
“Competing Services” means any products or services that are similar to or competitive with the
products and services sold or offered by Company. “Restricted Customers” means any of Company’s
current, former, or prospective customers to whom Grantee provided services, with whom Grantee had
business contact on behalf of Company, with respect to whom Grantee has confidential information,
or with whom Grantee had any responsibilities during the last two years of Grantee’s term of office
as a non-employee director with Company.



          (c) Non-disparagement. During Grantee’s term of office as a non-employee director and
following Grantee’s termination of such office for any reason including Retirement, Grantee will
not publicly or privately make disparaging comments with respect to Company or it’s directorate or
management in general and specifically with respect to any of Company’s personnel, operations,
products, policies or practices.



          (d) Non-Competition. During Grantee’s term of office as a non-employee director and
for a period of one year following termination of such office for any reason, including Retirement,
Grantee will not, without the prior written consent of Company, become employed by (including
self-employment) or otherwise provide services to (including as a director or advisory director) or
on behalf of any person or entity whose business competes with Company where both:



               (i) Grantee will be called to perform the same or substantially similar functions to those
which Grantee performed while serving as a non-employee director of Company during the one-year
period prior to the termination of Grantee’s office as a non-employee director, and



               (ii) Grantee will, by virtue of the new business relationship, be acting in a manner which is
or may reasonably be expected to be prejudicial to or in conflict with the interests of Company, as
determined in the reasonable discretion of the chief executive officer of Company or his designee.



          (e) Subsequent assistance. Following Grantee’s termination of office as a
non-employee director for any reason, (other than death and in certain instances, Disability)
Grantee shall furnish such reasonable subsequent assistance requested by Company that is deemed
material to the transition of responsibilities from Grantee to his or her successor.  



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          (f) Reformation. If any portion of these restrictive covenants is found to be
unenforceable, any court of competent jurisdiction may reform the restrictions as to time,
geographical area or scope to the extent required to make the provision enforceable under
applicable law.



          (g) Disclosure of Information. Grantee hereby agrees that he/she will provide Company
with any information reasonably requested to determine compliance with these restrictive covenants
and authorizes Company to disclose the covenants and the remedies for their violation to any third
party who might be affected thereby, including Grantee’s prospective employer.



          (h) Cancellation and Other Remedies. If Grantee violates the restrictive covenants
described in paragraphs 3(a) through 3(e) above:



               (i) all shares subject to this restricted stock award that are subject to restriction will be
forfeited immediately,



               (ii) all shares that were covered by this grant and that became free of restrictions within
the period beginning one year prior to the termination of Grantee’s directorship with the Company,
net of any taxes withheld (whether withheld in cash or shares), shall be canceled immediately for
no consideration, and



               (iii) Grantee will be required to reimburse Company in an amount equal to any gain realized by
Grantee (determined as of the sale date) with respect to the sale of any shares originally covered
by this restricted stock award within the period beginning one year prior to the termination of
Grantee’s directorship with the Company and ending six (6) months after the termination of
Grantee’s directorship with the Company, net of any taxes withheld (whether withheld in cash or
shares). Grantee agrees that the remedies under subparagraphs (h)(i), (ii) and (iii) will be
liquidated damages and is not to be construed in any manner as a penalty.


Grantee acknowledges that a violation or attempted violation on his or her part of the restrictive
covenants set forth in paragraphs 3(a) relating to disclosure of Confidential Information, 3(b)
relating to solicitation of Company’s employees and customers and 3(c) relating to the making of
disparaging comments concerning Company will cause immediate and irreparable damage to Company, and
therefore agrees that Company will be entitled as a matter of right to an injunction from any court
of competent jurisdiction restraining any violation or further violation of such terms, such right
to an injunction, however, will be cumulative and in addition to whatever other remedies Company
may have under law or equity. With respect to any violation of the restrictive covenants set forth
in paragraphs 3(d) relating to noncompetition and 3(e) relating to subsequent assistance, the right
to injunctive relief shall not apply and only the remedies set forth in subparagraphs 3(h)(i), (ii)
and (iii) shall be available to Company. In any action or proceeding by Company to enforce these
restrictive covenants where Company is the prevailing party, Company shall be entitled to recover
from Grantee its reasonable attorneys’ fees and expenses incurred in such action or proceeding.




     4. Non-Assignability of Award. The award hereby granted shall not be transferable.
No purported assignment or transfer of this award, or of the rights represented thereby, whether
voluntary or involuntary, by operation of law or otherwise, shall vest in the purported assignee or
transferee any interest or right whatsoever. For the avoidance of doubt, the parties acknowledge
that this Section 4 applies to the award itself, not to the shares subject to the award, and that
the transferability of the shares subject to the award shall be governed by Section 2 of this
Agreement.



     5. Adjustments. In the event of any stock dividend, reclassification, subdivision or
combination, or similar transaction affecting the shares covered by this award, the rights of the
Grantee are subject to adjustment as provided in Section 6.01 of the Plan to the extent deemed
necessary by the Committee.



     6. Rights as Shareholder. Subject to the restrictions and risk of forfeiture set
forth in Section 2, the Grantee shall have all rights of a shareholder (including voting and
dividend rights) with respect to the shares subject to the award commencing on the date on which
the shares subject to the award are issued.



     7. Withholding. The Grantee authorizes the Company to withhold from his or her
compensation to satisfy any withholding obligations in connection with the award. If the Grantee
is no longer serving as a director of the Company at the time any applicable taxes are due and must
be remitted by the Company, the Grantee agrees to pay applicable taxes to the Company, and the
Company may delay removal of the restrictive legend until proper payment of such taxes has been
made by the Grantee. The Grantee may satisfy such obligations under this Section 7 by any method
authorized under Section 7.06 of the Plan.



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     8. Notices. Every notice relating to this Agreement shall be in writing and if given
by mail shall be given by registered or certified mail with return receipt requested. All notices
to the Company shall be delivered to the Secretary of the Company at the Company’s headquarters.
All notices by the Company to the Grantee shall be delivered to the Grantee personally or addressed
to the Grantee at the Grantee’s last residence address as then contained in the records of the
Company or such other address as the Grantee may designate. Either party by notice to the other
may designate a different address to which notices shall be addressed. Any notice given by the
Company to the Grantee at the Grantee’s last designated address shall be effective to bind any
other person who shall acquire rights hereunder.



     9. Governing Law. This Agreement (a) shall be governed by and construed in accordance
with the laws of the State of Michigan without giving effect to conflict of laws, and (b) is not
valid unless it has been signed by the Grantee and the Company.



     10. Provisions of Plan Controlling. The provisions hereof are subject to the terms
and provisions of the Plan. In the event of any conflict between the provisions of this Agreement
and the provisions of the Plan, the provisions of the Plan shall control.



     11. Return of Signed Agreement. This Agreement must be signed by Grantee and received
in the Human Resources Department of the Company, Attention: Compensation, Mail Code 001045, no
later than the close of business on                     . In the event that this Agreement is not
signed by Grantee and received by the Human Resources Department by                     as set forth
herein, the Common Stock granted hereunder shall be canceled immediately and Grantee shall forfeit
any rights hereunder.



     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year
first above written.



	 	 	 	 	 	 	 	 	 
	GRANTEE	 	CITIZENS REPUBLIC BANCORP, INC.
	 
	 	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	 	 	William R. Hartman	 	 
	 

	 	Its:
	 	 	 	Chief Executive Officer	 	 







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