ex10-40.htm


    Exhibit
10.40

     

    INTERNATIONAL
COAL GROUP, INC.

     

    2005
EQUITY AND PERFORMANCE INCENTIVE PLAN

     

    NON-EMPLOYEE
DIRECTOR RESTRICTED SHARE UNIT AGREEMENT

     

    


     

    


     

    THIS
RESTRICTED SHARE UNIT AGREEMENT (this “Agreement”), dated as of _______________,
20___, is entered into between International Coal Group, Inc., a Delaware
corporation (the “Company”), and __________________________
(“Grantee”).  Capitalized terms used herein but not defined shall have
the meanings assigned to those terms in the Company’s 2005 Equity and
Performance Incentive Plan, as amended (the “Plan”).

     

    W
I T N E S S E T H:

     

    A.           The
Plan provides for grants of Restricted Share Units to Non-Employee Directors of
the Company; and

     

    B.           Grantee
is a Non-Employee Director of the Company; and

     

    C.           The
execution of this Agreement in the form hereof has been authorized by the
Board.

     

    NOW,
THEREFORE, in consideration of these premises and the covenants and agreements
set forth in this Agreement, the Company and Grantee agree as
follows:

     

    
      	
              1.  

            	
              Grant of Restricted Share
      Units.  Subject to and upon the terms, conditions, and
      restrictions set forth in this Agreement and in the Plan, the Company
      hereby grants to the Grantee __________ Restricted Share Units (the
      “Grant”).  This Agreement constitutes an “Evidence of Award”
      under the Plan.

            


    

     

    
      	
              2.  

            	
              Date of
      Grant.  The effective date of the grant of the Restricted
      Share Units is ________ (the “Date of
Grant”).

            


    

     

    
      	
              3.  

            	
              Restrictions on Transfer of
      Restricted Share Units.  Other than as provided herein,
      neither the Restricted Share Units granted hereby nor any interest therein
      shall be transferable other than by will or the laws of descent and
      distribution.

            


    

     

    
      	
              4.  

            	
              Vesting of Restricted Share
      Units.  Subject to Section 5 hereof, the Restricted Share
      Units shall be fully vested on the Date of Grant; provided,
      however,  that the certificates representing the Common
      Shares subject to the Grant shall not be delivered to Grantee until the
      six-month anniversary of the date on which Grantee ceases to provide
      services to the Company as a Non-Employee Director of the
      Company.

            


    

     

    
      	
              5.  

            	
              Forfeiture of Restricted Share
      Units.  Notwithstanding any provisions of this Agreement
      to the contrary, if Grantee violates the terms and conditions contained in
      Section 9, Grantee will forfeit the Grant (including the vested Restricted
      Share Units).

            


    

     


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    
      	
              6.  

            	
              Payment of Restricted Share
      Unit.  The restrictions on transfer on the Restricted
      Share Units imposed by Section 3 shall lapse and the shares of Common
      Stock underlying the Restricted Share Units shall be transferred to the
      Grantee (or to the Grantee’s estate as the case may be), except as
      otherwise provided in Section 8, upon the six-month anniversary of
      the date on which Grantee ceases to provide services to the Company as a
      Non-Employee Director of the Company; provided, however, that if at the
      time a payment or settlement would otherwise be due under this Section 6,
      the Grantee is a “specified employee” within the meaning of Section 409A
      of the Code (determined in accordance with methodology and procedures
      adopted by the Company and then in effect) and the payment is considered
      deferred compensation within the meaning of Section 409A of the Code, such
      payment shall instead be made on the first day after the sixth month
      following the month in which the payment was initially due to be
      made.

            


    

     

    
      	
              7.  

            	
              Dividend, Voting and Other
      Rights.  The Grantee shall have no rights of ownership in
      the Restricted Share Units and shall have no voting rights with respect to
      such Restricted Share Units until the date on which the shares of Common
      Stock are transferred to the Grantee pursuant to Section 6
      above.  From and after the Date of Grant and until the earlier
      of (a) the time when the Grantee receives the shares of Common Stock
      underlying the Restricted Share Units in accordance with Section 6
      hereof or (b) the time when the Grantee’s right to receive the Restricted
      Share Units is forfeited in accordance with Section 5 hereof, the
      Company shall pay to the Grantee whenever a normal cash dividend is paid
      on shares of Common Stock, an amount of cash equal to the product of the
      per-share amount of the dividend paid times the number of such Restricted
      Share Units.  Such payment shall be made within 30 days after
      the corresponding dividend payment is made to the stockholders of the
      Company.

            


    

     

    
      	
              8.  

            	
              Retention of Common Stock by
      the Company.  During the period in which the restrictions
      on transfer and risk of forfeiture provided in Sections 3, 4 and 5 above
      are in effect, the certificates representing the Common Shares covered by
      the Grant shall be retained by the Company.  To the extent the
      issuance of the Common Stock is recorded in a book-entry system,
      appropriate notations shall be made to reflect the restrictions on
      transfer and risk of forfeiture.  At such time as the Restricted
      Share Units become payable as specified in Section 4, the Company shall
      deliver all certificates representing such payable shares of Common Stock
      to the Grantee or remove the restrictions from the book-entry system,
      except in the event that the Grantee has notified the Company of his or
      her election to satisfy any tax obligations by surrender of a portion of
      such Common Shares, the Company will deliver the certificates or adjust
      the book-entry representing the remaining balance of Common Shares after
      the amount necessary for such taxes has been
  deducted.

            


    

     

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              9.  

            	
              Confidentiality;
      Non-Disparagement.  Grantee, both during the term hereof
      and thereafter, will not, directly or indirectly, use for himself or use
      for, or disclose to, any party other than the Company, any secret or
      confidential information or data regarding the business of the Company or
      any of its Subsidiaries, or any secret or confidential information or data
      regarding the business or property of the Company or any of its
      Subsidiaries, or regarding any secret or confidential apparatus, process,
      system or other method at any time use, developed or investigated by or
      for the Company or any of its Subsidiaries, whether or not developed,
      acquired, discovered or investigated by Grantee. Upon the date Grantee
      ceases to provide services to the Company, or as soon thereafter as
      possible, Grantee shall promptly deliver to the Company all memoranda,
      notes, records, plats, sketches, plans or other documents made by,
      compiled by, delivered to, or otherwise acquired by Grantee concerning the
      business or properties of the Company or any of its Subsidiaries, or any
      secret or confidential product, apparatus or process used, developed,
      acquired or investigated by the Company or any of its
      Subsidiaries.

            


    

     

    
      	
               
      

            	
              Grantee
      agrees that Grantee will not make any statements, whether oral, written,
      telephonic, electronic, or by or in any other method or in any other
      format, that in any way disparage, damage, or undermine the character or
      reputation of the Company or any of its Subsidiaries, or any member of
      management thereof; provided, however, that Grantee may make such
      statements as are necessary to comply with law.  The Company may
      resort to a court of equity to enforce this Section 9 by injunctive
      relief.  In the event of a breach or threatened breach of this
      Section 9 by Grantee, the Company may withhold the Grant (including any
      vested Restricted Share Units) under this Agreement pending the outcome of
      litigation and/or arbitration regarding such alleged breach of this
      Agreement by Grantee.  Grantee agrees that the Company may
      enforce this Section 9 without posting a bond and without giving notice to
      the maximum extent permitted by
law.

            


    

     

    
      	
              10.  

            	
              Compliance with
      Law.  The Company shall make reasonable efforts to comply
      with all applicable federal and state securities laws; provided, however,
      notwithstanding any other provision of this Agreement, the Company shall
      not be obligated to issue any shares of Common Stock or other securities
      pursuant to this Agreement if the issuance thereof would, in the
      reasonable opinion of the Company, result in a violation of any such
      law.  In such case, the Company shall comply with Treasury
      Regulation section
1.409A-2(b)(7)(ii).

            


    

     

    
      	
              11.  

            	
              Compliance with Section 409A of
      the Code.  To the extent applicable, it is intended that
      this Agreement and the Plan comply with the provisions of
      Section 409A of the Code, so that the income inclusion provisions of
      Section 409A(a)(1) do not apply to Grantee.  This Agreement
      and the Plan shall be administered in a manner consistent with this
      intent.

            


    

     

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              12.  

            	
              Communications.  All
      notices, demands and other communications required or permitted hereunder
      or designated to be given with respect to the rights or interests covered
      by this Agreement shall be deemed to have been properly given or delivered
      when delivered personally or sent by certified or registered mail, return
      receipt requested, U.S. mail or reputable overnight carrier, with full
      postage prepaid and addressed to the parties as
  follows:

            


    

     

    
      	
              If
      to the Company, at:

            	 
      	
              300
      Corporate Centre Drive

            
	 
      	 
      	
              Scott
      Depot, WV 25560

            
	 
      	 
      	
              Attention:  General
      Counsel

            


    

    


    
      	
              If
      to Grantee, at:

            	 
      	
              Grantee’s
      address provided by Grantee on the last page
  hereof

            


    

    


    Either
the Company or Grantee may change the above designated address by written notice
to the other specifying such new address.

     

    
      	
              13.  

            	
              Interpretation.  The
      interpretation and construction of this Agreement by the Board shall be
      final and conclusive.  No member of the Board shall be liable
      for any such action or determination made in good
  faith.

            


    

     

    
      	
              14.  

            	
              Amendment in
      Writing.  This Agreement may be amended as provided in
      the Plan; provided, however, that all such amendments shall be in
      writing.

            


    

     

    
      	
              15.  

            	
              Integration.  The
      Restricted Share Units are granted pursuant to the
      Plan.  Notwithstanding anything in this Agreement to the
      contrary, this Agreement is subject to all of the terms and conditions of
      the Plan.    In the event of any inconsistency between
      the provisions of this Agreement and the Plan, the Plan shall
      govern.  A copy of the Plan is available upon request and is
      incorporated herein by reference.  As such, this Agreement and
      the Plan embody the entire agreement and understanding of the Company and
      Grantee and supersede any prior understandings or agreements, whether
      written or oral, with respect to the Restricted Share
      Units.  The Board acting pursuant to the Plan, as constituted
      from time to time, shall, except as expressly provided otherwise herein,
      have the right to determine any questions which arise in connection with
      this Grant.  Any amendment to the Plan shall be deemed to be an
      amendment to this Agreement to the extent that the amendment is applicable
      hereto; provided however, that no amendment shall adversely affect the
      rights of Grantee under this Agreement without Grantee’s
      consent.

            


    

     

    
      	
              16.  

            	
              Severance.  In
      the event that one or more of the provisions of this Agreement shall be
      invalidated for any reason by a court of competent jurisdiction, any
      provision so invalidated shall be deemed to be separable from the other
      provisions hereof and the remaining provisions hereof shall continue to be
      valid and fully enforceable.

            


    

     

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              17.  

            	
              Successors and
      Assigns.  The provisions of this Agreement shall inure to
      the benefit of, and be binding upon, the successors, administrators,
      heirs, legal representatives, and assigns of Grantee, and the successors
      and assigns of the Company.

            


    

     

    
      	
              18.  

            	
              Governing
      Law.  This Agreement is made under, and shall be
      construed in accordance with, the laws of the State of
      Delaware.

            


    

     

    
      	
              19.  

            	
              Counterparts.  This
      Agreement may be executed in one or more counterparts, each of which shall
      be deemed an original and all of which together shall constitute one and
      the same instrument.

            


    

     

    


     

    


     

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    IN
WITNESS WHEREOF, this Agreement is executed by a duly authorized representative
of the Company on the day and year first above written.

    


     

    
      	
              INTERNATIONAL
      COAL GROUP, INC.

            
	 
      	 
      
	
              By:

            	 
      	 
      
	
              Name:

            	 
      	 
      
	
              Title:

            	 
      	 
      


    

    


    


    The
undersigned Grantee acknowledges receipt of an executed original of this
Agreement and accepts the Restricted Share Units subject to the applicable terms
and conditions of the Plan and the terms and conditions hereinabove set
forth.

    


    


    
      	
              Date:

            	 
      	 
      	 
      
	 
      	 
      	 
      	
              Grantee

            


    

    


     

    GRANTEE:   Please
complete/update the following information.

    


    
      	
              Name:

            	 
      	 
      
	
              Address:

            	 
      	 
      
	 
      	 
      	 
      
	 	 	 
	 
      	 
      	 
      


    

    


     

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