Document:

Exhibit 10(j)

 

DIRECTORS STOCK GRANT PROGRAM

(amended and restated)

 

1.            PURPOSE

The purpose of the Directors Stock Grant Program (the “Program”) is to attract and retain qualified individuals to serve as directors of TCF Financial Corporation (“TCF Financial”), and to encourage and enhance ownership of TCF common stock, par value $.01 per share (“TCF Stock”) by these individuals.

 

2.            ADMINISTRATION

Full power to construe, interpret and administer the program is vested with a committee consisting of the non-employee directors (as defined by Rule 16b-3 of the Securities and Exchange Commission (the “SEC”)) of the Board of TCF Financial (the “Committee”).  In the event such directors at some time do not qualify as non-employee directors for the purposes of Rule 16b-3, if approval by a committee composed solely of non-employee  directors is then appropriate in order for the shares of TCF Stock awarded under the Program to be exempt under Rule 16b-3, then the Board of Directors will appoint a new Committee which qualifies under the provisions of Rule 16b-3 as then in effect.  The Committee shall interpret the Program, prescribe, amend and rescind rules and regulations relating thereto, and make all other determinations necessary or advisable for the administration of the Program.

 

3.            PARTICIPANTS

Participants in the Program will consist of the outside directors of TCF Financial from time to time.

 

4.            BENEFITS

Each director of TCF Financial will periodically receive formula awards of restricted shares of TCF Stock without other payment as additional compensation for their services to TCF Financial.

 

Awards Granted Prior to January 17, 2012:

 

Awards will be made upon the full vesting of an award previously granted to directors under the Program (each, a “Grant Date”).  Each award will be equal in value to three (3) times the total amount of his or her annual retainer fee.  A director elected by the board between Grant Dates will receive a pro-rated award based on the number of months from the beginning of board service until the next anticipated Grant Date.  Value will be determined on the basis of the Fair Market Value of TCF Stock on the day the award is made, based on the annual retainer (not including Committee chair retainer fees) in effect at the beginning of that day.

 

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Vesting will occur over a minimum of three years from the applicable Grant Date (or a shorter period for a pro rata award made upon a director’s election between Grant Dates), and is based on the attainment of the goal set for the award by the Committee.  If the goal is not achieved, no vesting occurs for that year.  There is not, however, a forfeiture in years (if any) when the goal is not achieved, so that the grant is effectively extended for an additional year in such circumstances.  The director must be on the board on December 31 of the year in order to receive shares vesting based on that year’s performance.  If the goal is achieved, one-third of the shares will vest as soon as reasonably feasible following the fiscal year in which the goal is achieved, as determined by the Committee.  For a pro rata award made between Grant Dates, vesting shall occur ratably based on the remaining vesting of awards granted to incumbent directors on the last preceding Grant Date.  If some or all of the restricted shares are not vested on the basis of goals by ten (10) years after the applicable Grant Date, and if the director is still with TCF Financial on that date, then any remaining restricted shares will become vested on that date.

 

Awards Granted On or After January 17, 2012

 

Commencing on January 17, 2012, awards will be made automatically on the third Tuesday of each January (each, a “Grant Date”).

 

Each award will be equal in value to $45,000.  A director first elected by the board between Grant Dates will receive a pro-rated award based on the number of months from the beginning of board service until the next Grant Date.  The number of restricted shares of TCF Stock subject to each award will be determined on the basis of the Fair Market Value of TCF Stock on the day the award is made.

 

Each award will vest on the next Grant Date after the date the award was made.  The director must be on the board on the vesting date in order to receive the vested shares.

 

All Awards

 

If a director retires from service on the board of TCF Financial pursuant to board policy on director retirement in effect at that time, the restricted period will lapse and all shares will become fully vested.  There is no vesting in the event of a full or partial disability.

 

During the time the shares are restricted, they will not be transferable by the directors and a legend will be placed on the stock certificates (or book-entry shares, if applicable) to that effect.

 

5.            DEFINITIONS

 

FAIR MARKET VALUE

 

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The term “Fair Market Value” of shares of TCF Stock at any time shall be the average of the high and low sales prices for TCF Stock for the date, as reported by the New York Stock Exchange.

 

CHANGE IN CONTROL

A “Change in Control” shall be deemed to have occurred if:

 

(a)             any “person” as defined in Section 13(d) and 14(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) is or becomes the “beneficial owner” as defined in Rule 13d-3 under the Exchange Act, directly or indirectly, of securities of TCF Financial representing thirty percent (30%) or more of the combined voting power of TCF Financial’s then outstanding securities.  For purposes of this clause (a), the term “beneficial owner” does not include any employee benefit plan maintained by TCF Financial that invests in TCF Financial’s voting securities; or

 

(b)          during any period of two (2) consecutive years (not including any period prior to April 1995) there shall cease to be a majority of the Board comprised as follows:  individuals who at the beginning of such period constitute the Board or as new directors whose nomination for election by TCF Financial’s shareholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election previously so approved; or

 

(c)           the shareholders of TCF Financial approve a merger or consolidation of TCF Financial with any other corporation, other than a merger or consolidation which would result in the voting securities of TCF Financial outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least 70% of the combined voting power of the voting securities of TCF Financial or such surviving entity outstanding immediately after such merger of consolidation, or the shareholders of TCF Financial approve a plan of complete liquidation of TCF Financial or an agreement for the sale or disposition by TCF Financial of all or substantially all TCF Financial’s assets; provided, however, that no change in control will be deemed to have occurred if such merger, consolidation, sale or disposition of assets, or liquidation is not subsequently consummated.

 

DISABILITY

The term “disability” for all purposes of this Program shall be determined by the Committee in such manner as the Committee deems equitable or required by the applicable laws or regulations.

 

RETIREMENT

 

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The term “retirement” means a retirement under the policies of the Board of Directors of TCF Financial in effect at the time of a director’s departure from the Board.

 

6.            ADJUSTMENT PROVISIONS

If TCF Financial shall at any time change the number of issued shares of TCF Stock  without new consideration to TCF Financial (such as by stock dividends or stock splits), then the total number of shares reserved for issuance under this Program and the number of shares covered by each outstanding award shall be adjusted so that the limitations, the aggregate consideration payable to TCF Financial, and the value of each such award shall not be changed.  The Committee shall also have the right to provide for the continuation of awards or for other equitable adjustments after changes in the shares of TCF Stock resulting from reorganization, sale, merger, consolidation or similar occurrence.

 

Notwithstanding any other provision of this Program, and without affecting the number of shares otherwise reserved or available hereunder, the Committee may authorize the issuance or assumption of the grants in connection with any merger, consolidation, acquisition of property or stock, or reorganization upon such terms and conditions as it may deem appropriate.

 

All terms and conditions of all restricted stock awards outstanding shall be deemed satisfied and all such awards shall vest as of the date of a Change in Control.

 

7.            AMENDMENT AND TERMINATION OF PROGRAM

The Board of Directors of TCF Financial or the Committee may amend this Program from time to time, but not more often than once every six months, other than to comply with requirements of the Internal Revenue Code, or may terminate this Program at any time, but no action shall reduce the then existing amount of any participant’s benefit or adversely change the terms and conditions thereof without the participant’s consent.  No amendment of this Program shall result in any Committee member losing his or her status as a “non-employee  director” as defined in Rule 16b-3 of the Securities and Exchange Commission with respect to any employee benefit plan of TCF Financial.  This Program shall expire ten years from the date of its most recent approval by shareholders, unless the shareholders approve renewal of this Program before it expires.

 

8.            SHAREHOLDER APPROVAL

This Program will be submitted to the TCF Shareholders for approval on April 25, 2012.

 

4Exhibit 10(j)-1

FORM OF

DIRECTORS

RESTRICTED STOCK AGREEMENT

 

DIRECTORS RS NO. «Agr_No» (Non-Deferred Shares)

 

Shares of Restricted Stock are hereby awarded effective as of January 17, 2012 by TCF Financial Corporation (“TCF Financial”) to «Director_Name» (the “Grantee”) in accordance with the following terms and conditions:

 

1.            Share Award.  TCF Financial hereby awards to the Grantee 4,025 shares (the “Shares”) of Common Stock, par value $.01 per share (“Common Stock”) of TCF Financial, pursuant to the Amended and Restated Directors Stock Grant Program (the “Program”) upon the terms and conditions therein and hereinafter set forth.  This award is subject to forfeiture if the Program is not approved at the 2012 Annual Meeting of Stockholders.  A copy of the Program is incorporated herein by reference and is attached hereto.

 

2.            Restrictions on Transfer and Restricted Periods.

 

a.             Beginning on the date of this Agreement (the “Commencement Date”), Shares may not be sold, assigned, transferred, pledged, or otherwise encumbered by the Grantee, except to TCF Financial or as hereinafter provided, and are subject to the restrictions set forth in the Program (collectively, the “Restrictions”).

 

b.            The period beginning on the Commencement Date and ending upon lapse of the Restrictions shall be referred to as the “Restricted Period” and the Shares will vest, subject to the acceleration and forfeiture provisions herein, with respect to one hundred percent (100%) of the Shares on January 15, 2013.

 

c.             The Compensation Committee of the Board (the “Committee”) shall have the authority, in its discretion, to accelerate the time at which any or all of the Restrictions shall lapse with respect to any Shares, or to remove any or all such Restrictions, whenever the Committee may determine that such action is appropriate by reason of changes in applicable tax or other laws or other changes occurring after the commencement of the Restricted Period.

 

3.            Termination of Service.  Except as provided in Section 8 below, if the Grantee ceases to be a member of all boards of directors of TCF Financial and its affiliated companies for any reason (including, but not limited to death, total or partial disability, or normal or early retirement), all Shares which at the time of such termination of board service are subject to the Restrictions shall upon termination of such service be forfeited and returned to TCF Financial unless the Committee, pursuant to its discretion under Section 2(c), shall

 

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determine to remove any or all of the Restrictions on such Shares prior to such forfeiture; provided that in the event of Grantee’s retirement from service on any of the boards of directors of TCF Financial or its affiliated companies pursuant to the board policy on director retirement in effect at that time, the Restricted Periods for any Shares still subject to Restricted Periods on that date shall lapse and all Shares shall be fully vested.

4.            Certificates for Shares.  TCF Financial shall issue one or more certificates in respect of the Shares and shall hold such certificates on deposit for the account of the Grantee until the expiration of the Restricted Period with respect to the Shares represented thereby.  Certificate(s) for Shares subject to a Restricted Period shall bear the following legend:

 

	
“The   transferability of this certificate and the shares of stock represented   hereby are subject to the terms and conditions (including forfeiture)   contained in the TCF Directors Stock Grant Program and an Agreement entered   into between the registered owner and TCF Financial Corporation.  Copies of the TCF Directors Stock Grant   Program and Agreement are on file in the offices of the Secretary of TCF   Financial Corporation, 200 Lake Street East, Wayzata, MN 55391.”
    

 

The Grantee further agrees that, if at any time requested by the Company during the Restricted Period, s/he shall execute a stock power endorsed in blank and that s/he shall promptly deliver such stock power to TCF Financial.  Alternatively, TCF Financial may cause the Shares to be issued in the name of the Grantee in a sub-issue of Common Stock managed by the transfer agent which is subject to the Restrictions.

 

5.            Grantee’s Rights.  Except as otherwise provided herein, Grantee, as owner of the Shares, shall have all rights of a stockholder, including, but not limited to, the right to receive all dividends paid on Shares and the right to vote the Shares.  Dividends payable on Shares that are subject to the Restrictions shall be paid to the Grantee at the same time as such dividends are paid to other shareholders; provided, that shares of Common Stock issued in payment of such dividends shall be subject to all of the Restrictions that apply to the Shares with respect to which such dividends are paid until all of the Restrictions applicable to such Shares have lapsed or otherwise have been removed.

 

6.            Expiration of Restricted Period.  Upon the expiration of the Restricted Period with respect to any Shares, TCF Financial shall redeliver to the Grantee (or, if the Grantee is deceased, to his legal representative, beneficiary or heir) the certificate(s) in respect of such Shares, without the restrictive legend provided for in Section 4 above, and the related stock power(s) held by TCF Financial pursuant to Section 4 above.  The Shares as to which the Restricted Period shall have lapsed or expired shall be free of the Restrictions and such certificates shall not bear the legend provided for in Section 4 above.

 

7.    Adjustments for Changes in Capitalization of TCF Financial.  In the event of any change in the outstanding Common Stock of TCF Financial by reason of any reorganization, recapitalization, stock split, combination or exchange of shares, merger, consolidation or any change in the corporate structure of TCF Financial or in the shares of Common Stock, or in the event of any issuance of preferred stock or other change in the capital structure of TCF Financial which the Committee deems significant for purposes of this Agreement, the number and class of Shares covered by this Agreement shall be appropriately adjusted by the Committee, whose determination of the appropriate adjustment, or whose determination

 

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that there shall be no adjustment, shall be conclusive.  Any Shares of Common Stock or other securities received, as a result of the foregoing, by the Grantee will be subject to the Restrictions and the certificate or other instruments representing or evidencing such Shares shall be legended and deposited with TCF Financial in the manner provided in Section 4 above.

 

8.            Effect of Change in Control.   Subject to the six-month holding requirement, if any, of Rule 16b-3 under the Securities Exchange Act of 1934, as amended but notwithstanding any other provision in this Program (including, but not limited to, Sections 2(b) and 3 of this Agreement) in the event of a Change in Control, as defined in the Program, all terms and conditions of this Restricted Stock Award shall be deemed satisfied, and all the Shares shall vest as of the date of the Change in Control.  Such vested Shares shall be distributed in accordance with the procedures described in Section 6 of this Agreement.

 

 

9.            Delivery and Registration of Shares of Common Stock.  TCF Financial’s obligation to deliver Shares of Common Stock hereunder shall, if the Committee so requests, be conditioned upon the receipt of a representation as to the investment intention of the Grantee or any other person to whom such Shares are to be delivered, in such form as the Committee shall determine to be necessary or advisable to comply with the provisions of the Securities Act of 1933, as amended, or any other federal, state, or local securities law or regulation.  It may be provided that any representation requirement shall become inoperative upon a registration of such Shares or other action eliminating the necessity of such representation under the Securities Act or other securities law or regulation.  TCF Financial shall not be required to deliver any Shares under the Program prior to the completion of such registration or other qualification of such Shares under state or federal law, rule, or regulation, as the Committee shall determine to be necessary or advisable.

 

10.    Program and Committee Interpretations as Controlling.  The Shares hereby awarded and the terms and conditions herein set forth are subject in all respects to the terms and conditions of the Program, which are controlling.  All determinations and interpretations of the Committee shall be binding and conclusive upon the Grantee or his or her legal representatives with regard to any question arising hereunder or under the Program.

 

11.    Grantee Service.  Nothing in this Agreement shall limit the right of the Board, Board committees, or shareholders of TCF Financial to remove the Grantee from service as a Director, to refuse to renominate or reelect the Grantee as a Director or to enforce the duly adopted retirement policies of the Board of TCF Financial.

 

12.    Grantee Acceptance.  The Grantee shall signify acceptance of the terms and conditions of this Agreement by signing in the space provided below and returning a signed copy hereof to TCF Financial.

 

13.    Section 409A of the Internal Revenue Code.  The arrangements described in this Agreement are not deferred arrangements and are intended to be exempt from Section 409A of the Internal Revenue Code of 1986, as amended.  In the event the Agreement (or any portion thereof) is determined to be subject to Section 409A, then the Agreement (or such portion) shall be interpreted as necessary to comply with the

 

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requirements of Section 409A, as interpreted by guidance issued by the Internal Revenue Service.

 

 

 

 

 

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

 

 

	
 
    	
TCF FINANCIAL   CORPORATION
    
	
 
    	
 
    
	
 
    	
By 
    	
 
    
	
 
    	
 
    	
General Counsel
    
	
 
    	
 
    
	
 
    	
ACCEPTED:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Signature - «Director_Name»
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
(Street Address)
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
(City, State and Zip   Code)
    

 

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