EX-10.10 FORM OF RESTRICTED STOCK AWARD AGREEMENT



 






Exhibit 10.10




RESTRICTED STOCK AWARD AGREEMENT




     THIS
AGREEMENT (the “Agreement”) is made and entered into as of the ___ day of _________, 20___,
by and between INDUSTRIAL DISTRIBUTION GROUP, INC. (the “Company”), and ____________
(“Grantee”).



W I T N E S S E T H:




     WHEREAS, the Company maintains the Industrial Distribution Group, Inc. 2007 Stock Incentive
Plan (the “Plan”), and Grantee has been selected by the Compensation Committee (the “Committee”) to
receive a Restricted Stock Award under the Plan;



     NOW, THEREFORE, IT IS AGREED, by and between the Company and Grantee, as follows:



     1. Award of Restricted Stock



     1.1
The Company hereby grants to Grantee an award of ______ Shares of restricted
stock (“Restricted Stock”), subject to, and in accordance with, the restrictions, terms and
conditions set forth in this Agreement and the Plan. The grant date of this award of Restricted
Stock is _________, 20___(“Grant Date”).



     1.2 This Agreement shall be construed in accordance with, and subject to, the
provisions of the Plan (which are incorporated herein by reference) and, except as otherwise
expressly set forth herein, the capitalized terms used in this Agreement shall have the same
definitions as set forth in the Plan. For purposes of this Agreement, employment with any
Subsidiary of the Company shall be considered employment with the Company. Further, with respect
to a Grantee who is a non-employee Director, any reference in this Agreement to “employment”,
“employ” or derivative terms with respect to the Company shall mean the Director’s service or
tenure as a member of the Board, and any reference to termination of employment with the Company
(or to a derivative term or concept) shall mean the cessation of the Director’s service or tenure
as a member of the Board.



     1.3 This Award is conditioned on Grantee’s execution of this Agreement. If this Agreement is
not executed by Grantee and returned to the Company within one month of the Grant Date, it may be
canceled by the Committee, resulting in the immediate forfeiture of all Shares of Restricted Stock.



     2. Vesting Requirements; Restrictions



     2.1 Determination of Vesting. [To be determined by Committee]



 









 





     Grantee shall be deemed to own, as of the applicable Vesting Date, notwithstanding its
later calculation, that number of Shares of Restricted Stock that shall have vested (in accordance
with Sections 2.1, 2.2 and 2.4) free and clear of all restrictions imposed by this Agreement
(except those imposed by Section 3.4 below), and the Committee shall make its calculations, and the
Company shall deliver one or more certificates for such number of Shares of Restricted Stock to
Grantee, as soon as practical after the applicable Vesting Date.



     2.2 Partial Vesting for Partial Performance of Certain Target Objectives. [To
be determined by Committee]



     2.3 Unvested Shares. Subject to Section 2.5 of this Agreement, any Shares of
Restricted Stock that are unvested as of their respective Vesting Dates immediately shall be
forfeited as of the applicable Vesting Date.



     2.4 Performance Contingency Vesting Restrictions. The Restricted Stock shall be
subject to the following performance contingency vesting restrictions:



Year
Eligible For Vesting: Fiscal Year 20     




	 	 	 	 	 	 	 	 	 
	 
	 	Eligible Restricted Shares	 
	 	____________ Shares	 
	 	Performance-Based	 	 	Vesting	 	 	20___ Performance	 
	 	Vesting Criteria	 	 	Percentage	 	 	Target Objectives	 
	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 
	 	 	 	 
	 





Fiscal Year 20___ Partial Vesting: ______




Year
Eligible For Vesting: Fiscal Year 20     




	 	 	 	 	 	 	 	 	 
	 
	 	Eligible Restricted Shares	 
	 	____________ Shares	 
	 	Performance-Based	 	 	Vesting	 	 	20___ Performance	 
	 	Vesting Criteria	 	 	Percentage	 	 	Target Objectives	 
	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 
	 	 	 	 
	 





Fiscal
Year 20___ Partial Vesting: ___



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Partial Performance Target Range:

     [To be determined by Committee]




Year
Eligible For Vesting: Fiscal Year
20     




	 	 	 	 	 	 	 	 	 
	 
	 	Eligible Restricted Shares	 
	 	____________ Shares	 
	 	Performance-Based	 	 	Vesting	 	 	20___ Performance	 
	 	Vesting Criteria	 	 	Percentage	 	 	Target Objectives	 
	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 
	 	 	 	 
	 





Fiscal Year 20___ Partial Vesting: ______




Partial Performance Target Range:

     [To be determined by Committee]




Year
Eligible For Vesting: Fiscal Year
20     




	 	 	 	 	 	 	 	 	 
	 
	 	Eligible Restricted Shares	 
	 	____________ Shares	 
	 	Performance-Based	 	 	Vesting	 	 	20___ Performance	 
	 	Vesting Criteria	 	 	Percentage	 	 	Target Objectives	 
	 	 	 	 	 	 	 	 	 
	 	 
	 	 	 
	 	 	 	 
	 





Fiscal Year 20___ Partial Vesting: _____




Partial Performance Target Range:

     [To be determined by Committee]




     2.5 Change in Control; Termination of Employment Without Cause. Notwithstanding
the other provisions of this Agreement, in the event of a Change in Control, or a termination of
Grantee’s employment with the Company without Cause, prior to any outstanding Vesting Date, one
third of any shares of Restricted Stock then remaining unvested shall become fully vested and
nonforfeitable as of the date of the Change in Control or termination without Cause. On
the



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date of the Change in Control or termination without Cause, as the case may be, the Company
shall deliver to Grantee one or more certificates for such shares of Restricted Stock, free and
clear of any restrictions imposed by this Agreement.




     2.6 Other Termination of Employment. Except as provided in Section 2.5, if Grantee
terminates employment prior to any outstanding Vesting Date (for any other reason including death,
Disability, Retirement, termination for Cause and voluntary resignation), any shares of Restricted
Stock then remaining unvested shall be forfeited as of the date of such termination, and all rights
of Grantee to such shares shall be terminated.



     2.7 Transfer Restrictions. The Restricted Stock may not be sold, assigned,
transferred, pledged or otherwise encumbered prior to the date Grantee becomes vested in the
Restricted Stock.



     2.8 Certain Definitions. For purposes of this Agreement, the following terms shall
have the meanings specified below:




     (a) “Eligible Restricted Shares” means the Shares of Restricted Stock eligible
for vesting in that year as set forth in the applicable table.




     (b) “Earnings Per Share” means, on a fully diluted basis, the amount therefor
calculated in accordance with GAAP and reflected on (or, if not directly reflected, then
derived exclusively from other GAAP information reflected on) the Company’s audited
financial statements.




     (c) “GAAP” means generally accepted accounting principles as then being applied in the
preparation of financial statements of the Company that are subject to audit by the
Company’s independent certified public accountants.




     (d) “Operating Margin” means the concept employed by the Company in its public
disclosures to reflect the Company’s operating income as a percentage of its revenues, with
the amount of each component used therein being the amount therefor calculated in accordance
with GAAP and reflected on (or, if not directly reflected, then derived exclusively from
other GAAP information reflected on) the Company’s audited financial statements.




     (e) “Sales Revenue” means the amount therefor calculated in accordance with GAAP and
reflected on (or, if not directly reflected, then derived exclusively from other GAAP
information reflected on) the Company’s audited financial statements.




     (f) “Vesting Date” means the last day of the applicable fiscal year, as set forth in
the tables in Section 2.4 of this Agreement, notwithstanding that the



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     calculations of performance necessary to determine vesting may be made after such date.




     3. Stock; Dividends; Voting



     3.1 The stock certificate(s) evidencing the Restricted Stock shall be registered on the
Company’s books in the name of Grantee as of the Grant Date. Physical possession or custody of
such stock certificates shall be retained by the Company until such time as the Shares of
Restricted Stock are vested in accordance with Section 2. While in its possession, the Company
reserves the right to place a legend on the stock certificate(s) restricting the transferability of
such certificates and referring to the terms and conditions (including forfeiture) of this
Agreement and the Plan.



     3.2 While the Restricted Stock is not vested, Grantee generally shall not be entitled to vote
such Restricted Stock. No dividends declared or paid by the Company with respect to its Shares
shall accrue or be payable with respect to any Shares of Restricted Stock that are unvested.



     3.3 In the event of any adjustments in authorized Shares as provided in Section 4.3 of the
Plan, the number and class of Shares of Restricted Stock or other securities that Grantee shall be
entitled to pursuant to this Agreement shall be appropriately adjusted or changed to reflect such
change, provided that any such additional Shares of Restricted Stock or additional or different
shares or securities shall remain subject to the restrictions in this Agreement.



     3.4 Grantee represents and warrants that Grantee is acquiring the Restricted Stock for
investment purposes only, and not with a view to distribution thereof. Grantee is aware that the
Restricted Stock may not be registered under the federal or any state securities laws and that, in
such case and in addition to the other restrictions on the Restricted Stock, the shares may not be
transferred unless an exemption from registration is available. By making this award of Restricted
Stock, the Company is not undertaking any obligation to register the Restricted Stock under any
federal or state securities laws.



     4. No Right to Continued Employment



     Nothing in this Agreement or the Plan shall be interpreted or construed to confer upon Grantee
any right with respect to continuance of employment by the Company or a Subsidiary, nor shall this
Agreement or the Plan interfere in any way with the right of the Company or a Subsidiary to
terminate Grantee’s employment at any time, subject to Grantee’s rights under this Agreement.



     5. Taxes and Withholding



     Grantee shall be responsible for all federal, state and local income taxes payable with
respect to this award of Restricted Stock. Grantee shall have the right to make such elections
under the Internal Revenue Code of 1986, as amended, as are available in connection with this



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award of Restricted Stock, including a “Section 83(b) election.” The Company and Grantee agree to report
the value of the Restricted Stock in a consistent manner for federal income tax purposes. The
Company shall have the right to retain and withhold from any payment of Restricted Stock the amount
of taxes required by any government to be withheld or otherwise deducted and paid with respect to
such payment. The Company may require Grantee to reimburse the Company for any such taxes required
to be withheld and may withhold any distribution in whole or in part until the Company is so
reimbursed. The Company shall also have the right to withhold from any other cash amounts due to
Grantee an amount equal to such taxes required to be withheld. Unless Grantee otherwise provides
for the satisfaction of the withholding requirements in advance, the Company shall withhold and
cancel a number of Shares of Restricted Stock having a market value equal to the minimum amount of
taxes required to be withheld.




     6. Grantee Bound by the Plan



     Grantee hereby acknowledges receipt of a copy of the Plan and agrees to be bound by all the
terms and provisions thereof.



     7. Restrictive Covenants



     7.1 Grantee hereby acknowledges that the Company may disclose (and/or has already disclosed)
to Grantee, and Grantee may be provided with access to and otherwise make use of, certain valuable
Confidential Information (as defined below) of the Company. Grantee also acknowledges that due to
Grantee’s relationship with the Company, Grantee will develop (and/or has developed) special
contacts and relationships with the Company’s employees or independent contractors, and that it
would be unfair and harmful to the Company if Grantee took advantage of these relationships to the
detriment of the Company.



     7.2 Grantee hereby agrees that, during employment and for a period of one (1) year following
any voluntary or involuntary termination of employment with the Company (regardless of reason),
Grantee will not directly or indirectly, individually, or on behalf of any Person other than the
Company or a Subsidiary:



          (a) solicit, recruit or induce (or otherwise assist any person or entity in soliciting,
recruiting or inducing) any employee or independent contractor of the Company, in either case who
performed work for the Company within the final year of Grantee’s employment with the Company, to
terminate his or her relationship with the Company; or




          (b) knowingly or intentionally damage or destroy the goodwill and esteem of the Company, any
Subsidiary, the Company’s Business or the Company’s or any Subsidiary’s suppliers, employees, patrons, customers, and others who may at any time have or have had
relations with the Company or any Subsidiary.




     7.3 Grantee further agrees that during employment and for a period of two (2) years
thereafter, Grantee will not, except as necessary to carry out Grantee’s duties as an employee of



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the Company, disclose or use Confidential Information without the Company’s prior written consent.
Grantee further agrees that, upon termination or expiration of employment with the Company for any
reason whatsoever or at any time, Grantee will deliver promptly to the Company all materials
(including electronically-stored materials), documents, plans, records, notes, or other papers, and
any copies in Grantee’s possession or control, relating in any way to the Company’s Business or
containing any Confidential Information of the Company, which at all times shall be the property of
the Company.




     7.4 For purposes of this Section 7, the following terms shall have the meanings specified
below:



          (a) “Company’s Business” means the nationwide businesses of (i) supplying maintenance, repair,
operating and production (“MROP”) products and services to manufacturers and other industrial
users; (ii) providing value-added business process outsourcing services and other arrangements,
including, without limitation, storeroom management, integrated supply, product applications and
production process improvements; and (iii) distributing MROP products, including, without
limitation, cutting tools, abrasives, hand and power tools, maintenance equipment, coolants,
lubricants, adhesives, and safety products.




          (b) “Confidential Information” means information, without regard to form, relating to the
Company’s or any Subsidiary’s customers, operation, finances and business that derives economic
value, actual or potential, from not being generally known to other Persons, including, but not
limited to, financial statements, manuals, business plans, business rules, business methods,
business practices, market studies, methods, graphs, strategies, techniques, processes, procedures,
formulas, inventions, marketing and pricing data, pricing policies or lists, technical or
non-technical data (including personnel data), contracts, sources and identity of vendors and
contractors, financial information of customers and the Company, computer software and programs
(including object code and source code), computer database systems, and other proprietary
documents, materials or information regarding (or otherwise obtained by) the Company, its
businesses and activities, or the manner in which the Company does business. Confidential
Information includes information disclosed to the Company or any Subsidiary by third parties that
the Company or any Subsidiary is obligated to maintain as confidential. Confidential Information
subject to this Agreement may include information that is not a trade secret under applicable law,
but information not constituting a trade secret only shall be treated as Confidential Information
under this Agreement for a two (2)-year period after Grantee’s date of termination of employment.




          (c) “Person” means any individual, corporation, bank, partnership, joint venture, association,
joint-stock company, trust, unincorporated organization or other entity.




     7.5 If, during Grantee’s employment with the Company or at any time during the restrictive
periods described in Section 7.2 or 7.3 above, Grantee violates the restrictive covenants set forth
in this Section 7, then the Committee shall, notwithstanding any other provision in this Agreement
to the contrary, cancel any outstanding Shares of Restricted Stock that have not yet vested, which
shall be the Company’s exclusive remedy under this Agreement



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for such a violation, but which shall
not limit any other remedy or right the Company may have outside of this Agreement as a result of
the underlying action by Grantee. Nothing contained herein shall in any way limit or exclude any
other right granted by law or equity to the Company. Grantee agrees that this Section 7 shall
survive the termination of Grantee’s employment.




     8. Modification of Agreement



     This Agreement may be modified or amended at any time by the Committee, provided that
Grantee’s written consent must be obtained for any modification that adversely alters or impairs
any rights or obligations of Grantee under this Agreement, unless there is an express Plan
provision permitting the Committee to act unilaterally to make the latter such modification.



     9. Severability



     Should any provision of this Agreement be held by a court of competent jurisdiction to be
unenforceable or invalid for any reason, the remaining provisions of this Agreement shall not be
affected by such holding and shall continue in full force in accordance with their terms.



     10. Governing Law



     The validity, interpretation, construction and performance of this Agreement shall be governed
by the laws of the State of Delaware without giving effect to the conflicts of the laws principles
thereof.



     11. Successors in Interest



     This Agreement shall inure to the benefit of, and be binding upon, the Company and its
successors and assigns, and upon any person acquiring, whether by merger, consolidation,
reorganization, purchase of stock or assets, or otherwise, all or substantially all of the
Company’s assets and business. This Agreement shall inure to the benefit of Grantee’s legal
representatives. All obligations imposed upon Grantee and all rights granted to the Company under
this Agreement shall be final, binding and conclusive upon Grantee’s heirs, executors,
administrators and successors.



     12. Resolution of Disputes



     Any dispute or disagreement that may arise under, or as a result of, or in any way relate to
the interpretation, construction or application of this Agreement, shall be determined by the
Committee. Any determination made hereunder shall be final, binding and conclusive on Grantee and
the Company for all purposes.



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



	 	 	 	 	 
	 

	 	 	 	“Company”
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name: ____________
	 

	 	 	 	Title: ____________






     Grantee hereby (i) acknowledges that a copy of the Plan is available from the Company’s
intranet site or upon request, (ii) represents that Grantee is familiar with the terms and
provisions of this Agreement and the Plan, and (iii) accepts the award of Restricted Stock subject
to all the terms and provisions of this Agreement and the Plan. Grantee hereby agrees to accept as
binding, conclusive and final all decisions or interpretations of the Committee upon any questions
arising under the Plan. Grantee authorizes the Company to withhold from any compensation payable
to Grantee, including by withholding Shares, in accordance with applicable law, any taxes required
to be withheld by federal, state or local law as a result of the grant or vesting of the Restricted
Stock.



	 	 	 
	 

	 	“Grantee”
	 
	 	 
	 

	 	 
	 

	 	Name: ____________







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