Exhibit 10.18


 


RESTRICTED COMMON STOCK AGREEMENT


 


RESTRICTED
COMMON STOCK AGREEMENT (this “Agreement”) made as of November 6, 2009
(the “Effective
Date”), by and between STR Holdings, Inc., a Delaware corporation
(the “Company”),
and [              ]
(the “Holder”).


 


WHEREAS, STR Holdings LLC (“Old
LLC”) entered into that certain Incentive Unit Grant Agreement with the Holder
dated as of June 15, 2007 (the “Grant Agreement”), whereby Old LLC granted
incentive units of Old LLC to the Holder;


 


WHEREAS, on the date hereof,
Old LLC will enter into a corporate reorganization, whereby the unitholders of
Old LLC will become unitholders of STR Holdings (New) LLC (“New LLC”);


 


WHEREAS, pursuant to that
certain Plan of Conversion by New LLC, dated as of November 6, 2009 (the “Plan
of Conversion”), New LLC filed with the Secretary of State of the State of
Delaware a certificate of conversion converting New LLC into the Company and
automatically converting the membership interests of New LLC into shares of
common stock, par value $0.01 per share (“Common Stock”), of the Company;


 


WHEREAS, due to the
conversion of New LLC into the Company, any unvested incentive units of Old LLC
granted pursuant to the Grant Agreement and converted in the corporate
reorganization into unvested incentive units of New LLC shall be converted from
unvested incentive units of New LLC into Restricted Shares (as defined below)
subject to the terms and conditions herein;


 


WHEREAS, in consideration of
the mutual covenants contained herein, the receipt and sufficiency of which are
hereby acknowledged; and


 


WHEREAS, certain capitalized
terms used herein are defined in Section 6 hereof.


 


NOW, THEREFORE, the parties
hereto agree as follows:


 


1.             Restricted Shares.  Subject to the terms and conditions of this
Agreement and pursuant to the Plan of Conversion, the Company hereby issues to
the Holder [        ] shares of Common
Stock (the “Restricted Shares”), of which [        ]
shares of Restricted Shares shall be Time Vesting Restricted Shares (as defined
below) and [        ] shares of
Restricted Shares shall be Performance Vesting Restricted Shares (as defined
below).


 


2.             Holder Representations and
Warranties.


 


(a)           As an inducement to the
Company to issue the Restricted Shares to the Holder and as a condition
thereto, the Holder represents, acknowledges and agrees (as applicable) that
this Agreement constitutes the legal, valid and binding obligation of the
Holder, enforceable against the Holder in accordance with its terms, except to
the extent the enforceability thereof may be limited by bankruptcy laws,
insolvency laws, moratorium laws or other laws affecting creditors’ rights
generally or by general equitable principles, and the execution, delivery and
performance of this Agreement by the Holder does not and will not conflict
with, violate or cause a breach of any agreement, contract or instrument to
which the Holder is a party or any judgment, order or decree to which the
Holder is subject.


 


(b)           In addition, the Holder
represents, acknowledges and agrees (as applicable) that:


 

















 


(i)         (x) the Restricted
Shares have not been registered under the Securities Act, (y) the
Restricted Shares are restricted securities under the Securities Act and (z) the
Restricted Shares may not be resold or transferred unless they are first
registered under the Securities Act or unless an exemption from such
registration is available;


 


(ii)        the Holder hereby makes the
representations and warranties set forth in Exhibit A hereto; and


 


(iii)       the Company may, but shall
not be obligated to, register or qualify the issuance, or the resale, of any of
the Restricted Shares under the Securities Act or any other applicable law.


 


3.             Vesting of Shares.


 


(a)           All Restricted Shares shall
initially be unvested and shall be subject to forfeiture to the Company
pursuant to this Agreement.  At such time
as a Restricted Share vests in accordance with this Section 3, it shall no
longer be a Restricted Share and shall not be subject to forfeiture.


 


(b)           Time Vesting. [        ]
of the Restricted Shares shall
vest based on the passage of time (“Time Vesting Restricted Shares”).


 


(i)         Vesting Schedule.  Subject to Sections 3(b)(ii) and
3(b)(iii)(1) and to the Holder’s continued employment with the Company on
each vesting date, the Time Vesting Restricted Shares shall vest in equal 1/32
installments as of the last day of each of the 32 calendar months following the
Effective Date, which for the sake of clarity means November 30, 2009.


 


(ii)        Acceleration upon Change of
Control.  Upon the occurrence of a Change
of Control, all then unvested Time Vesting Restricted Shares shall immediately
vest in full, subject to Section 3(b)(iii).


 


(iii)       Termination.


 


(1)           Upon termination of employment by the Holder for
Good Reason or by the Company without Cause, the unvested Time Vesting
Restricted Shares that would have vested had the Holder been employed for an
additional twelve (12) months from the date of termination of employment shall
vest immediately upon such date of termination. 
All remaining Time Vested Restricted Shares shall be forfeited.


 


(2)           Upon the termination of the Holder’s employment for
any reason other than pursuant to clause (iii)(1) above, all unvested Time
Vesting Restricted Shares shall be forfeited.


 


(c)           Performance Vesting. [        ]
of the Restricted Shares shall vest based on the Company attaining the
following performance criteria (“Performance Vesting Restricted Shares”).


 


(i)         Vesting Schedule.  Subject to Section 3(c)(ii) and to
the Holder’s continued employment with the Company on each vesting date, the
Performance Vesting Restricted Shares shall vest in three (3) equal
installments following the three successive Fiscal Years, beginning with the
Fiscal Year ending on December 31, 2009 (for the 2009 Fiscal Year) if the
Equity Valuation, measured as of the end of such Fiscal Year, is no less than
the Performance Target for such Fiscal Year. 
If the Performance Target for any of the first two Fiscal Years referred
to 


 


2

















 


above is not attained, the Yearly Amount for
the previous unvested Fiscal Year which is not then vested (or, if the Yearly
Amount for the previous Fiscal Year has vested, then the Yearly Amount for the
prior unvested Fiscal Year) shall become vested and exercisable at the end of the
first Fiscal Year thereafter in which the Equity Valuation for such Fiscal Year
is no less than the Performance Target for such Fiscal Year.  For purposes of illustration of the previous
sentence, if the Performance Target is not achieved for the 2009 and 2010
Fiscal Years but is achieved for the 2011 Fiscal Year, in 2011, the Yearly
Amounts for both 2010 and 2011 would become vested.


 


(ii)        Acceleration upon Change of
Control.  Upon the occurrence of a
Change of Control, all then unvested Performance Vesting Restricted Shares
shall immediately vest in full, so long as the Holder is employed with the
Company on the date of the Change of Control.


 


(iii)       Termination.  Upon the termination of employment of the
Holder for any reason, the unvested Performance Vesting Restricted Shares shall
be forfeited.


 


4.             Legend.


 


(a)           Each certificate
representing Restricted Shares shall bear each of the following legends.


 


“THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES
LAWS OF ANY STATE AND MAY NOT BE TRANSFERRED WITHOUT REGISTRATION UNDER
THE SECURITIES ACT OR STATE SECURITIES LAWS OR AN OPINION OF COUNSEL,
SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED.”


 


“THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT
BE TRANSFERRED, SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF
OR EXCHANGED UNLESS SUCH TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR
OTHER DISPOSITION OR EXCHANGE COMPLIES WITH THE PROVISIONS OF THE REGISTRATION
RIGHTS AGREEMENT AND THE RESTRICTED COMMON STOCK AGREEMENT, EACH AS AMENDED
FROM TIME TO TIME, BETWEEN OR AMONG THE COMPANY AND THE INVESTORS PARTY
THERETO.  IN ADDITION TO RESTRICTIONS ON
TRANSFER, THE RESTRICTED COMMON STOCK AGREEMENT PROVIDES FOR THE VESTING OF THE
SHARES ACCORDING TO THE SPECIFIC PROVISIONS OF THE RESTRICTED COMMON STOCK
AGREEMENT.  COPIES OF THE REGISTRATION
RIGHTS AGREEMENT AND THE RESTRICTED COMMON STOCK AGREEMENT ARE ON FILE WITH THE
COMPANY.”


 


(b)           The certificates shall also
bear any legend required by any applicable state securities law.


 


(c)           The certificates shall be
deposited by the Holder, together with a stock power endorsed in blank, with
the Company, to be held in escrow during any restriction period.


 


5.             Restrictions on Transfer and
Conversion.


 


(a)           The Company and the Holder
acknowledge and agree that the Restricted Shares are subject to and restricted
by this Agreement.  Once vested, the
Restricted Shares shall no longer be 


 


3

















 


restricted by the terms of
this Agreement but shall be subject to the restrictions set forth in the
Registration Rights Agreement and the Securities Act.


 


(b)           The Restricted Shares shall
only be transferable to Permitted Transferees of the Holder.  Any attempt to Transfer any of the Restricted
Shares to Persons other than Permitted Transferees of the Holder shall be null
and void and have no force or effect, and the Company shall not, and shall
cause any transfer agent not to, give any effect in such entity’s share records
to such attempted Transfer.


 


(c)           The Holder acknowledges that
the transfer restrictions contained in this Agreement are reasonable and in the
best interests of the Company.  The
Holder understands that this Agreement contains forfeiture provisions in
respect of the Restricted Shares in favor of the Company or its designee upon
the Holder’s termination of employment.


 


6.             Definitions.


 


The following terms shall
have the meanings ascribed below:


 


“Affiliate” of any Person
means any Person that directly, or indirectly through one or more
intermediaries, Controls, is Controlled by or is under common Control with such
Person.


 


“Cause” means “cause” as
defined in the Holder’s employment agreement with the Company or any of its subsidiaries.


 


“Change of Control” means:


 


(i)            the sale (in one transaction
or a series of transactions) of all or substantially all of the assets of the
Company to a third party other than any of the Existing Stockholders or any of
their respective Affiliates;


 


(ii)           a sale or issuance (in one
transaction or a series of transactions) of any securities resulting in more
than 50% of the voting power of the Company being held by a “person” or “group”
(as such terms are used in the Exchange Act) that does not include any of the
Existing Stockholders or any of their respective Affiliates;


 


(iii)          a merger or consolidation of
the Company with or into another Person if following such merger or
consolidation, more than 50% of the voting power of the Company is held by a “person”
or “group” (as such terms are used in the Exchange Act) that does not include
any of the Existing Stockholders or any of their respective Affiliates; or


 


(iv)          the sale or Transfer by the
DLJMB Stockholders to a prospective purchaser (other than a Permitted
Transferee) of fifty percent (50%) or more of their original beneficial
ownership of the Company.


 


“Control” and “Controlled”
mean the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.


 


“Consolidated EBITDA” means
Consolidated EBITDA as defined pursuant to that certain Credit Agreement, dated
as of June 15, 2007, by and between the Company, STR Acquisition, Inc.
the Lenders (as defined therein) and Credit Suisse, Cayman Islands Branch, as
it may be amended or restated from time to time.


 


4

















 


“Consolidated Net Debt”
means (i) any Indebtedness of the Company and its subsidiaries minus (ii) the
Company’s and its subsidiaries’ cash on hand and in banks, and any liquid
investments readily convertible to cash, excluding any cash held in escrow or
otherwise restricted.


 


“DLJMB Stockholders” means
DLJ Merchant Banking Partners IV, L.P., DLJMB Offshore Partners IV, L.P., DLJ
Merchant Banking Partners IV (Pacific), L.P. and MBP IV Plan Investors, L.P.,
DLJ Merchant Banking Partners IV (Co-Investments), L.P., together with any
Permitted Transferees thereof.


 


“Equity Valuation” means,
with respect to a particular Fiscal Year, (i) the product of (A) ten (10) and
(B) the Consolidated EBITDA for such Fiscal Year, less (ii) Consolidated
Net Debt as of the end of such Fiscal Year.


 


“Exchange Act” means the
Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder.


 


“Existing Stockholders”
means each of the Stockholders other than the Management Stockholders.


 


“Fiscal Year” means the
twelve month period ending on the last day of each calendar year.


 


“Good Reason” means “good
reason” as defined in the Holder’s employment agreement with the Company or any
of its subsidiaries.


 


“Indebtedness” means,
without duplication, the sum of:  (i) all
principal and accrued (but unpaid) interest owing by the Company and its
subsidiaries for debt for borrowed money owed to any third party (specifically
excluding intercompany debt between the Company and any of its subsidiaries and
any subsidiary of the Company and another subsidiary of the Company); plus (ii) all
obligations of the Company and its subsidiaries under leases that have been
recorded as capital leases under GAAP; plus (iii) indebtedness of any
person other than the Company or any of its subsidiaries that is guaranteed by
the Company or any of its subsidiaries.


 


“Initial Public Offering”
means the underwritten initial public offering of Common Stock of the Company
pursuant to an effective registration statement filed under the Securities Act.


 


“Management Stockholder”
means any Stockholder who is an employee of the Company or any of its
subsidiaries.  In no event shall any
DLJMB Stockholder be deemed to be a Management Stockholder.


 


“Other Stockholder” means
each of the Stockholders other than the DLJMB Stockholders, the Management
Stockholders and the Whitney Stockholders.


 


“Performance Target” means
the Equity Valuation target for each Fiscal Year as set forth on Schedule I
hereto with respect to Performance Vesting Restricted Shares.


 


“Permitted Transferees”
means (i) in the case of any DLJMB Stockholder, (A) any other DLJMB
Stockholder, (B), any actual or prospective shareholder, member or general or
limited partner of any DLJMB Stockholder (a “DLJMB Partner”), and any
corporation, partnership, limited liability company, or other entity that is an
Affiliate of any DLJMB Partner (collectively, “DLJMB Affiliates”), (C) any
managing director, general partner, director, limited partner, officer or
employee of any DLJMB 


 


5

















 


Stockholder or any DLJMB
Affiliate, or any spouse, lineal descendant, sibling, parent, heir, executor,
administrator, testamentary trustee, legatee or beneficiary of any of the
foregoing persons described in this clause (C) (collectively, “DLJMB
Associates”) or (D) any trust the beneficiaries of which, or any
corporation, limited liability company or partnership the stockholders, members
or general or limited partners of which, include only such DLJMB Stockholders,
DLJMB Affiliates, DLJMB Associates, their spouses or other lineal descendants;


 


(ii)           in the case of any Other
Stockholder, (A) any entity that is an Affiliate of such Other
Stockholder, (B) any actual or prospective shareholder, member or general
or limited partner of any such Other Stockholder, and any corporation, partnership,
limited liability company, or other entity that is an Affiliate of any such
Other Stockholder, (C) any spouse, lineal descendant, sibling, parent,
heir, executor, administrator, testamentary trustee, legatee or beneficiary of
such Other Stockholder, or (D) a trust that is for the exclusive benefit
of such Other Stockholder or its Permitted Transferees under clause (B) above;


 


(iii)          in the case of any Whitney
Stockholders, any other Whitney Stockholder; and


 


(iv)          in the case of any
Management Stockholder, (A) any spouse, lineal descendant, sibling,
parent, heir, executor, administrator, testamentary trustee, legatee or
beneficiary of the Holder, (B) a trust that is for the exclusive benefit
of the Holder or the transferees listed in (A) above or (C) a limited
liability company or corporation, all of the outstanding capital stock or
membership interests of which is of record and beneficially owned by the Holder
or any of those Persons in clause (A) above.


 


“Person” means any
individual or any general partnership, limited partnership, limited liability
company, corporation, joint venture, trust, business trust, cooperative,
association or other entity and, where the context so permits, the legal
representatives, successors in interest and permitted assigns of such Person.


 


“Registration Rights
Agreement” means the Registration Rights Agreement, dated as of November 6, 2009, among the
Company and certain stockholders of the Company, as amended, modified or
supplemented from time to time.


 


“Restricted Share Permitted
Transferees” means (i) any spouse, lineal descendant, sibling, parent,
heir, executor, administrator, testamentary trustee, legatee or beneficiary of
the Holder, (ii) a trust that is for the exclusive benefit of the Holder
or its Restricted Share Permitted Transferees under clause (i) above or (iii) a
limited liability company or corporation, all of the outstanding capital stock
or membership interests of which is of record and beneficially owned by the
Holder or any of those Persons in clause (i) above.


 


“Securities Act” means the Securities
Act of 1933, as amended, or any successor federal law then in force.


 


“Stockholder” means each
Person who held Common Stock of the Company prior to the Initial Public
Offering together with any Permitted Transferees thereof, so long as such
Person or Permitted Transferee thereof holds such Common Stock.


 


“Transfer” means the sale, transfer,
assignment, pledge or other disposal (whether with or without consideration and
whether voluntarily or involuntarily or by operation of law) of any Restricted
Shares.


 


6














 


“Whitney Stockholder” means
Prairie Fire Trust, Michael R. Stone, Michael R. Stone 2008 GRAT, MRS Trust,
Harrington Sound, LLC and Paul Vigano.


 


“Yearly Amount” means the
number of Performance Vesting Restricted Shares divided by three (3).


 


7.             General Provisions.


 


(a)           Notices.  Any notification required by the terms of
this Agreement shall be given in writing and shall be deemed effective upon
personal delivery or within three (3) days of deposit with the United
States Postal Service, by registered or certified mail, with postage and fees
prepaid.  A notice shall be addressed to
the Company at its principal executive office and to the Holder at the address
that he or she most recently provided to the Company.


 


(b)           Survival of Representations,
Warranties and Agreements.  All
representations, warranties and agreements contained herein shall survive
indefinitely, including following termination of this Agreement or of the
Holder’s employment with the Company.


 


(c)           Entire Agreement.  This Agreement and the Registration Rights
Agreement shall constitute the entire contract between the parties hereto with
regard to the subject matter hereof. 
They supersede any other agreements, representations or understandings
(whether oral or written and whether express or implied) which relate to the
subject matter hereof.


 


(d)           Waiver.  No waiver of any breach or condition of this
Agreement shall be deemed to be a waiver of any other or subsequent breach or
condition whether of like or different nature.


 


(e)           Successors and Assigns.  The provisions of this Agreement shall inure
to the benefit of, and be binding upon, the Company and its successors and
assigns and upon the Holder, the Holder’s assigns and the legal
representatives, heirs and legatees of the Holder’s estate, whether or not any
such person shall have become a party to this Agreement and have agreed in
writing to be joined herein and be bound by the terms hereof.


 


(f)            Choice of Law; Jurisdiction;
Waiver of Jury Trial.  THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF DELAWARE WITHOUT REGARD TO CONFLICTS OF LAWS.


 


SUBJECT TO THE TERMS OF THIS
AGREEMENT, THE PARTIES AGREE THAT ANY AND ALL ACTIONS ARISING UNDER OR IN
RESPECT OF THIS AGREEMENT SHALL BE LITIGATED IN THE FEDERAL OR STATE COURTS IN
DELAWARE.  BY EXECUTING AND DELIVERING
THIS AGREEMENT, EACH PARTY IRREVOCABLY SUBMITS TO THE PERSONAL JURISDICTION OF
SUCH COURTS FOR ITSELF, HIMSELF, OR HERSELF AND IN RESPECT OF ITS, HIS OR HER
PROPERTY WITH RESPECT TO SUCH ACTION. 
EACH PARTY AGREES THAT VENUE WOULD BE PROPER IN ANY OF SUCH COURTS, AND
HEREBY WAIVES ANY OBJECTION THAT ANY SUCH COURT IS AN IMPROPER OR INCONVENIENT
FORUM FOR THE RESOLUTION OF ANY SUCH ACTION.


 


EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.


 


7





















 


(g)           Amendment.  The Board of Directors of the Company, or the
Compensation Committee thereof, may amend or alter this Agreement and the
Restricted Shares issued hereunder at any time; provided that, no such
amendment or alteration shall be made without the consent of the Holder if such
action would materially diminish any of the rights of the Holder under this Agreement
or with respect to the Restricted Shares.


 


(h)           Employment Rights.  Neither this Agreement nor any of its
provisions is intended to confer or should be construed as conferring any
rights on the Holder to continued employment with the Company or any rights of
employment for a fixed term.  No contract
of employment, express or implied, is created hereby and nothing contained
herein shall be construed as creating a joint venture, partnership, agency or
other enterprise between the parties.


 


(i)            No Waiver; Modifications in
Writing.  No waiver of or consent to any
departure from any provision of this Agreement shall be effective unless signed
in writing by the party entitled to the benefit thereof; provided, however,
that the Company may amend, modify or terminate the terms of the Restricted
Shares in accordance with the terms in the Company’s Certificate of
Incorporation.


 


(j)            Severability. The provisions of this Agreement are severable and if any one or more
provisions are determined to be illegal or otherwise unenforceable, in whole or
in part, the remaining provisions shall nevertheless be binding and
enforceable.


 


(k)           Signature in Counterparts.  This Agreement may be signed in counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.


 


[SIGNATURE PAGE
FOLLOWS]


 


8





















 


IN WITNESS WHEREOF, the
parties hereto have executed this Restricted Common Stock Agreement as of the
date first written above.


 


 


	
   

  	
  STR HOLDINGS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title

  
	
   

  	
   

  
	
   

  	
  HOLDER

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [                ]

  



 


9





















 


EXHIBIT A


 


Investment Representations and Warranties


 


The Holder hereby represents
and warrants to the Company that:


 


1.             The Restricted
Shares received by him will be held by him for investment only for his own
account, not as a nominee or agent, and not with a view to the sale or
distribution of any part thereof in violation of applicable U.S. federal or
state or foreign securities laws.  The Holder has no current
intention of selling, granting participation in or otherwise distributing the
Restricted Shares in violation of applicable U.S. federal or state or foreign
securities laws.  The Holder does not have
any contract, undertaking, agreement or arrangement with any person or entity
to sell, transfer or grant participation to such person or entity, or to any
third person or entity, with respect to any of the Restricted Shares, in each
case, in violation of applicable U.S. federal or state or foreign securities
laws.


 


2.             The Holder understands
that the Restricted Shares have not been registered under the Securities Act or
any applicable U.S. federal, state or foreign securities laws, and that the Restricted
Shares are being issued in reliance on an exemption from registration, which
exemption depends upon, among other things, the bona fide nature of the
investment intent and the accuracy of the Holder’s
representations as expressed herein.


 


3.             The Holder has such
knowledge and experience in financial and business matters as to be capable of
evaluating the merits and risks of his owning the Restricted Shares.  The Holder is a
sophisticated investor, has relied upon independent investigations made by the Holder and, to the
extent believed by the Holder to be appropriate, the Holder’s
representatives, including the Holder’s own
professional, tax and other advisors, and is making an independent decision to
invest in the Restricted Shares.  The Holder has been
furnished with such documents, materials and information that the Holder deems
necessary or appropriate concerning the terms and conditions of the
transactions contemplated by the Agreement and the Holder’s holding of
the Restricted Shares and for evaluating an investment in the Company, and the Holder has read
carefully such documents, materials and information and understands and has
evaluated the types of risks involved with holding the Restricted Shares.  The Holder has not relied
upon any representations or other information (whether oral or written) from
the Company or its stockholders, directors, officers or affiliates, or from any
other person or entity, in connection with his investment in the Restricted
Shares.  The Holder acknowledges
that the Company has not given any assurances with respect to the tax
consequences of the ownership and disposition of the Restricted Shares.


 


4.             The Holder understands
that no U.S. federal or state or foreign agency has passed upon the Restricted
Shares or upon the Company, or upon the accuracy, validity or completeness of
any documentation provided to the Holder in connection
with the transactions contemplated by the Agreement, nor has any such agency
made any finding or determination as to holding the Restricted Shares.


 


5.             The Holder understands
that there are substantial restrictions on the transferability of the
Restricted Shares and that on the date of the Agreement and for an indefinite
period thereafter there will be no public market for the Restricted Shares and,
accordingly, it may not be possible for the Holder to liquidate
his investment in case of emergency, if at all. 
In addition, the Holder understands that the
Agreement contains substantial restrictions on the 


 


A-1





















 


transferability
of the Restricted Shares and provide that, in the event that the conditions
relating to the transfer of any Restricted Shares in such document have not
been satisfied, the holder shall not transfer any such Restricted Shares, and
unless otherwise specified the Company will not recognize the transfer of any
such Restricted Shares on its books and records or issue any share certificates
representing any such Restricted Shares, and any purported transfer not in
accordance with the terms of the Agreement shall be void.  As such, Holder understands
that: a restrictive legend or legends in a form to be set forth in the
Agreement will be placed on the certificates representing the Restricted
Shares; a notation will be made in the appropriate records of the Company
indicating that each of the Restricted Shares are subject to restrictions on
transfer and, if the Company should at some time in the future engage the
services of a securities transfer agent, appropriate stop-transfer instructions
will be issued to such transfer agent with respect to the Restricted Shares;
and the Holder will sell, transfer or otherwise dispose of the
Restricted Shares only in a manner consistent with the Holder’s
representations set forth herein and then only in accordance with the
Agreement.


 


6.             The Holder understands
that (i) the Restricted Shares may not be sold, transferred or otherwise
disposed of without registration under the Securities Act or an exemption
therefrom, (ii) the Restricted Shares have not been registered under the
Securities Act; (iii) the Restricted Shares must be held indefinitely and
he must continue to bear the economic risk of holding the Restricted Shares
unless such shares are subsequently registered under the Securities Act or an
exemption from such registration is available; (iv) the Holder is prepared to
bear the economic risk of holding the Restricted Shares for an indefinite
period of time; (v) it is not anticipated that there will be any public
market for the Restricted Shares; (vi) the Restricted Shares are
characterized as “restricted securities” under the U.S. federal securities
laws; and (vii) the Restricted Shares may not be sold, transferred or
otherwise disposed of except in compliance with federal, state and local law.


 


7.             The Holder understands
that an investment in the Restricted Shares is not recommended for investors
who have any need for a current return on this investment or who cannot bear
the risk of losing their entire investment. 
In that regard, the Holder understands that his
holding the Restricted Shares involves a high degree of risk of loss.  The Holder acknowledges
that: (i) he has adequate means of providing for his current needs and
possible personal contingencies and has no need for liquidity in this investment;
(ii) his commitment to investments which are not readily marketable is not
disproportionate to his net worth; and (iii) his holding the Restricted
Shares will not cause his overall financial commitments to become excessive.


 


8.             The Holder is/is not
(circle one) an “accredited investor,” as such term is defined in Rule 501
of the Securities Act.


 





















 


SCHEDULE I


 


Restricted
Stock Performance Target Calculation


 


	
   

  	
   

  	
  2009

  	
   

  	
  2010

  	
   

  	
  2011

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Adjusted EBITDA

  	
   

  	
  $

  	
  66.6

  	
   

  	
  $

  	
  82.3

  	
   

  	
  $

  	
  103.5

  	
   

  
	
  EV / EBITDA Multiple

  	
   

  	
  10.0x

  	
   

  	
  10.0x

  	
   

  	
  10.0x

  	
   

  
	
  Enterprise Value

  	
   

  	
  $

  	
  665.6

  	
   

  	
  $

  	
  823.1

  	
   

  	
  $

  	
  1,034.5

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Less: Net Debt on Balance Sheet

  	
   

  	
  (235.9

  	
  )

  	
  (225.9

  	
  )

  	
  (206.4

  	
  )

  
	
  Value of Common Equity

  	
   

  	
  $

  	
  429.8

  	
   

  	
  $

  	
  597.3

  	
   

  	
  $

  	
  828.1

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Performance Threshold

  	
   

  	
  85.0

  	
  %

  	
  85.0

  	
  %

  	
  85.0

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Performance Target

  	
   

  	
  $

  	
  365.3

  	
   

  	
  $

  	
  507.7

  	
   

  	
  $

  	
  703.8