Document:

Exhibit 10.12

 

FIRST FINANCIAL CORPORATION

2011 OMNIBUS EQUITY INCENTIVE PLAN

RESTRICTED STOCK AWARD AGREEMENT

 

THIS AGREEMENT (the “Agreement”), made and executed as of the 3rd day of February, 2012, between First Financial Corporation, an Indiana corporation (the “Company”), and                           , an officer or employee of the Company or one of its Subsidiaries (the “Participant”).

 

WITNESSETH:

 

WHEREAS, the Company has adopted the First Financial Corporation 2011 Omnibus Equity Incentive Plan (the “Plan”) to focus the efforts of key employees of the Company and its Subsidiaries on continued improvement in the profitability of the Company and its Subsidiaries with the objective of providing an adequate return to shareholders on their investment in the Company while at the same time assuring that Awards under the Plan, in combination with the Company’s other compensation programs: (a) provide Participants incentives that appropriately balance risk and reward; (b) are compatible with effective controls and risk-management; and (c) are supported by strong oversight of the Board as delegated to the Committee; and

 

WHEREAS, in 2011, the Committee timely established Performance Goals for calendar year 2011 for purposes of making Awards to Eligible Employees in 2012 should it decide to do so; and

 

WHEREAS, on February 3, 2012 the Committee determined the Performance Goals set for 2011 were met and that the Committee should grant Restricted Stock to Eligible Employees subject to the terms and conditions of an Award Agreement; and

 

WHEREAS, the Participant has been designated by the Committee as an individual to whom Restricted Stock should be granted as determined from the duties performed, the initiative and industry of the Participant, and his or her potential contribution to the future development, growth and prosperity of the Company;

 

WHEREAS, all provisions of the Plan, including defined terms, are incorporated herein and are expressly made a part of this Agreement by reference;

 

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the Company and the Participant agree as follows:

 

1.             Award of Restricted Stock.  The Company hereby makes an Award of                            shares of Restricted Stock to the Participant (the “Restricted Stock”), which is the equivalent of $                           (the dollar value of the Award calculated based on the Company’s 2011 performance against the Performance Goals) divided by $36.88 (the mean between the highest and lowest quoted selling prices of the common stock of the Company as reported on NASDAQ on February 3, 2012) and rounded down to the nearest whole number.  The Grant Date of this Award is February 3, 2012.  The Participant hereby acknowledges that he or she has received a copy of the Plan.

 

2.             Performance Period.  The Performance Period set by the Committee for purposes of making Awards in 2012 commenced on January 1, 2011 and ended on December 31, 2011.

 

3.             Performance Goals.  The Performance Goals for the Performance Period are set forth in Exhibit A.

 

 

4.             Earning of Restricted Stock.  Prior to making the Award, the Committee determined the Performance Goals for the Performance Period were met at the Maximum level of performance.  Accordingly, the Award is treated as fully earned as of December 31, 2011.

 

5.             Period of Restriction and Vesting.  The Period of Restriction will begin on the date as of which the Award was earned and end, except as otherwise provided in Sections 3 and 4 of this Agreement, on the date shares of Restricted Stock become vested.  For purposes of this Agreement, the shares of Restricted Stock will become vested, to the extent they were earned pursuant to Section 4, in accordance with the following schedule provided the Participant is employed by the Company or a Subsidiary on such date:

 

	
Anniversary of
   Earning Date
    	
 
    	
Vested
   Percentage
    	
 
    
	
1st
    	
 
    	
33
    	
%
    
	
2nd
    	
 
    	
66
    	
%
    
	
3rd
    	
 
    	
100
    	
%
    

 

In the event a Participant has a Termination of Service before the end of the Period of Restriction, he will forfeit his Restricted Stock Award unless he has a Termination of Service for one of the following reasons, in which case he will become 100 percent vested:

 

(a)                                 The Participant died;

 

(b)                                 The Participant incurred a Disability;

 

(c)                                  The Participant Retired;

 

(d)                                 The Participant terminated employment for Good Reason; or

 

(e)                                  The Participant’s employment was terminated without Cause.

 

6.             Change in Control.  If in the event of a Change in Control, a successor to the Company or any person acquiring control of the Company does not agree to be bound by the terms of the Plan and this Agreement, then the Restricted Stock shall be 100 percent earned and vested upon the date of the Change in Control.  However, if the successor to the Company or any person acquiring control of the Company agrees to be bound by the terms of the Plan and this Agreement, then the Restricted Stock will continue to be earned and vested in accordance with this Agreement.

 

7.             Pass-Through of Dividends and Voting Rights.  Unless otherwise determined by the Committee in its sole discretion, after an Award of Restricted Stock has been earned, the Participant shall be entitled to (a) receive all cash dividends paid with respect to the Restricted Stock, and (b) exercise all voting rights associated with the Restricted Stock, regardless of whether the Period of Restriction has lapsed.

 

8.             Code Section 83(b) Election.  The Participant is permitted to make an election with respect to the Restricted Stock under Section 83(b) of the Internal Revenue Code of 1986, as amended (the “Code”).  If the Participant makes an election under Code Section 83(b), then the Participant shall provide a copy of such election to the Company within 30 days following the date of this Agreement.

 

9.             Participant’s Representations.  The Participant represents to the Company that the terms and arrangements relating to the grant of Restricted Stock have been arrived at or made through

 

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direct communication with the Company or a person acting in its behalf and the Participant, and such terms are based solely on this Agreement and the Plan.

 

10.          Nontransferability.  Until the end of the Period of Restriction, the Restricted Stock cannot be (a) sold, transferred, assigned, margined, encumbered, bequeathed, gifted, alienated, hypothecated, pledged or otherwise disposed of, whether by operation of law, whether voluntarily or involuntarily or otherwise, or (b) subject to execution, attachment or similar process.  Any attempted or purported transfer of Restricted Stock in contravention of this Section or the Plan shall be null and void and of no force or effect whatsoever.

 

11.          Issuance of Shares.  At or within a reasonable period of time following execution of this Agreement, the Company shall issue, in book entry form, the Restricted Stock.  Within 75 days following the date shares of Restricted Stock becomes vested, the Company shall issue to the Participant or his beneficiary a certificate for the number of shares of Restricted Stock earned under Exhibit A, less any withholding required by Section 12 of this Agreement.

 

12.          Income and Employment Tax Withholding.  The Participant shall be solely responsible for paying to the Company all required federal, state, city and local income and employment taxes which arise on the expiration of the Period of Restriction and the vesting of the shares of Restricted Stock.  The Committee, in its sole discretion and subject to such rules as it may adopt, may require the Participant to satisfy any withholding tax obligation by having the Company retain shares of Restricted Stock which have a Fair Market Value, determined as of the date of the issuance of such Restricted Stock to the Participant, equal to the amount actually withheld to pay the taxes.

 

13.          Clawback of Awards.  In the event the Company is required to prepare an accounting restatement due to the Company’s material noncompliance with any financial reporting requirement under securities laws, and Restricted Stock became vested based on the erroneous data within three years preceding the date of the accounting restatement, then the Participant is required to repay the Company the excess (in either cash or shares of Company stock) which would not have been paid to the Participant under the accounting restatement.

 

14.          Mitigation of Excise Tax.  The Participant acknowledges that the Restricted Stock issued hereunder is subject to reduction by the Committee for the reasons specified in Section 14.11 of the Plan.

 

15.          Indemnity.  The Participant hereby agrees to indemnify and hold harmless the Company and its Affiliates (and their respective directors, officers and employees), and the Committee, from and against any and all losses, claims, damages, liabilities and expenses based upon or arising out of the incorrectness or alleged incorrectness of any representation made by Participant to the Company or any failure on the part of the Participant to perform any agreements contained herein.  The Participant hereby further agrees to release and hold harmless the Company and its Affiliates (and their respective directors, officers and employees) from and against any tax liability, including without limitation, interest and penalties, incurred by the Participant in connection with the Participant’s participation in the Plan.

 

16.          Financial Information.  The Company hereby undertakes to deliver to the Participant, at such time as they become available and so long as the Period of Restriction has not expired and the Restricted Stock has not been forfeited, a balance sheet and income statement of the Company with respect to any fiscal year of the Company ending on or after the date of this Agreement.

 

17.          Changes in Shares.  In the event of any change in the Shares, as described in Section 4.7 of the Plan, the Committee shall make appropriate adjustment or substitution in the shares of Restricted

 

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Stock, all as provided in the Plan.  The Committee’s determination in this respect shall be final and binding upon all parties.

 

18.          Effect of Headings.  The descriptive headings of the Sections and, where applicable, subsections, of this Agreement are inserted for convenience and identification only and do not constitute a part of this Agreement for purposes of interpretation.

 

19.          Gender and Number.  Where the context permits, words in the masculine gender shall include the feminine gender, the plural shall include the singular and the singular shall include the plural.

 

20.          Controlling Laws.  Except to the extent superseded by the laws of the United States, the laws of the State of Indiana, without reference to the choice of law principles thereof, shall be controlling in all matters relating to this Agreement.

 

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

 

IN WITNESS WHEREOF, the Company, by its officer thereunder duly authorized, and the Participant, have caused this Restricted Stock Award Agreement to be executed as of the day and year first above written.

 

	
 
    	
 
    
	
 
    	
FIRST FINANCIAL CORPORATION
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
PARTICIPANT
    
	
 
    	
 
    
	
 
    	
 
    	
 
    

 

4Exhibit 10.1

 

SECOND AMENDMENT TO REVOLVING CREDIT, TERM LOAN AND SECURITY AGREEMENT

 

this Second Amendment to Revolving Credit, Term Loan and Security Agreement (the “Amendment”) is made this 22nd day of March, 2012 among appliance recycling centers of america, inc., a Minnesota Corporation (“arca”), appliance recycling centers of america-california, inc., a California Corporation (“arca-ca”), arca canada inc., an Ontario, Canada Corporation (“arca canada”) appliancesmart, inc., a Minnesota Corporation (“Appliance Smart”, together with arca, arca-ca and arca Canada, collectively, the “Borrowers” and each individually, a  “Borrower”), certain financial institutions party to the Credit Agreement from time to time as lenders (the “Lenders”), and pnc bank,  national association, as agent and lender (“pnc”, in such capacity, “Agent”).

 

RECITALS

 

A.                                    The Borrowers, Lenders and PNC are parties to that certain Revolving Credit, Term Loan and Security Agreement dated as of January 24, 2011 (as the same may have been amended, supplemented or otherwise modified from time to time prior to the date hereof, the “Credit Agreement”), pursuant to which PNC has made certain loans to, and extensions of credit for the account of, the Borrowers.  The Credit Agreement and all other documents executed in connection therewith to the date hereof are collectively referred to as the “Existing Financing Agreements.”  All capitalized terms used not otherwise defined herein shall have the meaning ascribed thereto in the Loan Agreement, as amended hereby

 

B.                                    The Borrowers have requested, and PNC has agreed, to amend certain provisions of the Credit Agreement subject to the terms and conditions of this Amendment.

 

NOW THEREFORE,  with the foregoing background hereinafter deemed incorporated by reference herein and made part hereof, the parties hereto, intending to be legally bound, promise and agree as follows:

 

1.                                     Amendments to Credit Agreement.

 

(a)                            Leases.                   As of the Effective Date, Section 7.11 of the Credit Agreement is amended and restated as follows:

 

7.11                        Leases.  Enter as lessee into any lease arrangement for real or personal property (unless capitalized and permitted under Section 7.6 hereof) if after giving effect thereto, aggregate annual rental payments for all leased property would exceed $6,200,000 in any one fiscal year in the aggregate for all Borrowers.

 

2.                                      Waiver.  To the extent that any Default or Event of Default has occurred since the Closing Date due to Borrowers’ failure to comply with Section 7.11, upon the effectiveness of this Amendment, Agent and Lenders hereby waive any such Default or Event of Default provided however that such waiver shall in no way constitute a waiver of any other Default or Event of Default which may have occurred, nor shall this waiver obligate Agents or Lenders to provide any further waiver of any other Default or Event of Default under the Loan Agreement

 

 

(whether similar or dissimilar, including any further Default or Event of Default resulting from a failure to comply with Section 7.11 of the Loan Agreement).  This waiver shall not preclude the future exercise of any right, power, or privilege available to Agents or Lenders whether under the Loan Agreement, the Other Documents or otherwise upon the occurrence of any Event of Default after the date hereof.

 

3.                                      Representations and Warranties.     Each Borrower, hereby:

 

(a)                            represents and warrants that all representations and warranties set forth in the Loan Agreement and all of the other Existing Financing Agreements are true and correct in all material respects as of the date hereof (except to the extent any such representations and warranties specifically relate to a specific date, in which case such representations and warranties were true and correct in all material respects on and as of such other specific date);

 

(b)                            reaffirms all of the covenants contained in the Credit Agreement as amended hereby and covenants to abide thereby until the satisfaction in full of the Obligations and the termination of the commitments of the Lenders under the Credit Agreement;

 

(c)                             represents and warrants that, after giving effect to this Amendment, no Default or Event of Default has occurred and is continuing under any of the Existing Financing Agreements;

 

(d)                            represents and warrants that it has the authority and legal right to execute, deliver and carry out the terms of this Amendment, that such actions were duly authorized by all necessary corporate or company action, as applicable, and that the officers executing this Amendment on its behalf were similarly authorized and empowered, and that this Amendment does not contravene any provisions of its organizational documents or of any contract or agreement to which it is a party or by which any of its properties are bound; and

 

(e)                             represents and warrants that this Amendment is valid, binding and enforceable against the Borrowers in accordance with its terms except as such enforceability may be limited by any applicable bankruptcy, insolvency, moratorium or similar laws affecting creditors’ rights generally and by general principles of equity (whether enforcement is sought in equity or at law).

 

4.                                     Conditions Precedent/Effectiveness Conditions.  This Amendment shall be effective upon Agent’s receipt of this Amendment (in form and substance satisfactory to Agent in its reasonable discretion) fully executed by Borrowers and the Lenders;

 

5.                                     Further Assurances.  Each Borrower hereby agrees to take all such actions and to execute and/or deliver to Agent and Lenders all such documents, assignments, financing statements and other documents, as Agent and Lenders may reasonably require from time to time, to effectuate and implement the purposes of this Amendment.

 

6.                                     Payment of Expenses.  Borrowers shall pay or reimburse Agent for its reasonable attorneys’ fees and expenses in connection with the preparation, negotiation and execution of this Amendment and the documents provided for herein or related hereto.

 

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7.                                     Reaffirmation of Credit Agreement.  Except as modified by the terms hereof, all of the terms and conditions of the Credit Agreement, as amended by this Amendment, and all other of the Other Documents are hereby reaffirmed and shall continue in full force and effect as therein written.

 

8.                                     Miscellaneous.

 

(a)                            Third Party Rights.  No rights are intended to be created hereunder for the benefit of any third party donee, creditor, or incidental beneficiary.

 

(b)                            Loan Document. This Amendment is an “Other Document” as defined and described in the Credit Agreement and all of the terms and provisions of the Credit Agreement relating to Other Documents shall apply hereto.

 

(c)                             Headings.  The headings of any paragraph of this Amendment are for convenience only and shall not be used to interpret any provision hereof.

 

(d)                            Governing Law.  This Amendment shall be governed by and construed in accordance with the laws of the State of Illinois.

 

(e)                             Severability. Any provision of this Amendment which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction

 

(f)                              Counterparts.  This Amendment may be executed in any number of counterparts and by facsimile, PDF or other electronic transmissions, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

 

(g)                             Successors and Assigns.  This Amendment shall be binding upon and inure to the benefit of the parties hereto and its respective successors and assigns.

 

[SIGNATURES TO APPEAR ON FOLLOWING PAGE]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the date first written above.

 

	
BORROWERS:
    	
 
    	
APPLIANCE   RECYCLING CENTERS OF AMERICA, INC.
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   Edward R, Cameron
    
	
 
    	
 
    	
Name:
    	
Edward   R. Cameron
    
	
 
    	
 
    	
Title:
    	
President &   CEO
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
APPLIANCE   RECYCLING CENTERS OF AMERICA-CALIFORNIA, INC.
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   Edward R, Cameron
    
	
 
    	
 
    	
Name:
    	
Edward   R. Cameron
    
	
 
    	
 
    	
Title:
    	
President &   CEO
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
ARCA   CANADA, INC.
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   Edward R, Cameron
    
	
 
    	
 
    	
Name:
    	
Edward   R. Cameron
    
	
 
    	
 
    	
Title:
    	
President &   CEO
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
APPLIANCESMART, INC.
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   Edward R, Cameron
    
	
 
    	
 
    	
Name:
    	
Edward   R. Cameron
    
	
 
    	
 
    	
Title:
    	
President &   CEO
    

 

 

	
AGENT AND LENDER:  
    	
 
    	
PNC BANK, NATIONAL ASSOCIATION,
    
	
 
    	
 
    	
as   Lender and as Agent
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/   Timothy Canon
    
	
 
    	
 
    	
 
    	
Timothy   Canon, Vice President
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
200   S. Wacker Drive, Suite 600
    
	
 
    	
 
    	
 
    	
Chicago, IL   60606
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
Commitment Percentage: 100%

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