Document:

10.4 LoJack-DirectorRestrictedStockAgreement

EXHIBIT 10.4
LOJACK CORPORATION

RESTRICTED STOCK AGREEMENT

COVER SHEET
This Restricted Stock Agreement (the “Agreement”) consists of this Cover Sheet and the LoJack Corporation Restricted Stock Agreement attached hereto.

Date of grant and effective date of this Agreement:  

Class of stock:  common stock, $0.01 par value

Number of shares of Common Stock:    
    

Grantee:            
            

Grantee’s address:    

IN WITNESS WHEREOF, each of the parties hereto have duly executed this Agreement on the date and year first above written.

LOJACK CORPORATION
By:                                            
Name:    
Title:    

GRANTEE

                                        
Name

                

LOJACK CORPORATION

RESTRICTED STOCK AGREEMENT 

W I T N E S S E T H:
- - - - - - - - - -

WHEREAS, Grantee is an officer, director, key employee or service provider of LoJack Corporation or its successor, as applicable (the “Company”), or a subsidiary thereof; and
WHEREAS, the Company, pursuant to the LoJack Corporation 2008 Stock Incentive Plan, the terms and provisions of which are incorporated herein by this reference (the “Plan”), desires to issue and grant to the Grantee, and the Grantee desires to accept, shares of the Company’s common stock, $0.01 par value (“Common Stock”), upon the terms and subject to the conditions herein set forth;
NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the parties hereto, intending to be legally bound, hereby agree as follows:
1.    Grant of Restricted Stock.  In recognition of the Grantee’s commitment to the continued growth and financial success of the Company and its Subsidiaries (within the meaning of Section 1 of the Plan), the Company hereby grants to the Grantee the number of shares of Common Stock set forth on the Cover Sheet, which shares shall be subject to the restrictions, terms and conditions set forth in this Agreement (“Restricted Stock”).  Simultaneously with the execution and delivery of this Agreement by the parties hereto, the Company shall deliver to the Grantee a stock certificate (or certificates) representing the Restricted Stock, which stock certificate(s) shall (a) be registered on the Company’s stock transfer books in the name of the Grantee and (b) bear (in addition to any other legends required by applicable law) the following legend (or a legend substantially similar thereto):
“This certificate and the shares represented hereby are issued pursuant to, subject to, and shall be transferable only in accordance with, the provisions of the LoJack Corporation 2008 Stock Incentive Plan and a certain Restricted Stock Agreement dated _______ between Name and LoJack Corporation.”
2.    Removal of Restricted Stock Legend.  After the Restricted Stock has vested in accordance with the provisions of Section 3, the Company, upon request of the Grantee, shall cause the transfer agent for the Common Stock to issue a stock certificate(s) representing the shares of Common Stock that are free of restrictions and without the legend referred to in Section 1.
3.    Vesting.
(a)    In General.  All shares of Restricted Stock shall be subject to forfeiture until the second anniversary of the Grant Date, at which time the Grantee’s rights to the Restricted 

                

Stock shall become nonforfeitable (“vested”).  Prior to such date, the Restricted Stock shall be forfeitable (“unvested”).
(b)    Accelerated Vesting.  Notwithstanding the foregoing, Restricted Stock shall vest without any action on the part of the Company or the Grantee in accordance with the following schedule in the event of the Grantee’s death or Disability:
       If event occurs after            Vested Shares
Second anniversary of Grant Date    All of the Restricted Stock

(c)    Definitions.  For all purposes of this Agreement, the term “Disability” shall have the meaning set forth in Section 5(g) of the Plan.
4.    Non-Transferability of Restricted Stock.  Unvested shares of Restricted Stock may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of, such shares shall not be assignable by operation of law and such shares shall not be subject to execution, attachment or similar process.  Any attempted sale, assignment, transfer, pledge, hypothecation or other disposition of any unvested shares of Restricted Stock contrary to the provisions hereof shall be null and void and without effect.
5.    Forfeiture.
(a)    If at such time as the Grantee no longer is an officer, director, employee of or consultant or service provider to the Company or any of its Subsidiaries, the Grantee is not vested in all shares of Restricted Stock governed by this Agreement, record and beneficial ownership of the unvested shares shall revert to the Company and the Grantee shall be deemed to have forfeited such unvested shares (a “Forfeiture”) without any consideration therefor.
(b)    Upon the occurrence of a Forfeiture, the Grantee shall, within ten business days thereafter, transfer and deliver to the Company all stock certificates representing all unvested shares of Restricted Stock, together with stock powers duly executed in blank by the Grantee.  From and after the occurrence of a Forfeiture, the Grantee shall have no rights to or interests in any shares of the unvested Restricted Stock or under this Agreement (other than the obligation to transfer and deliver all stock certificates representing all shares of the Restricted Stock pursuant to this Section 5(b)).
6.    Representations and Warranties of Grantee.  The Grantee hereby represents and warrants to the Company as follows:
(a)    The Grantee has the legal right and capacity to enter into this Agreement and fully understands the terms and conditions of this Agreement.
(b)    The Grantee is acquiring the Restricted Stock for investment purposes only and not with a view to, or in connection with, the public distribution thereof in violation of the Securities Act of 1933, as amended.

                

7.    Notices.  Any notice required or permitted hereunder shall be deemed given only when delivered personally or when deposited in a United States Post Office as certified mail, postage prepaid, addressed, as appropriate, if to the Grantee, at his address set forth on the Cover Sheet or such other address as the Grantee may designate in writing to the Company, and, if to the Company, at 40 Pequot Way, Canton, MA 02021 or such other address as the Company may designate in writing to the Grantee.
8.    Section 83(b) Election.  The Grantee shall promptly furnish the Company with a copy of any election filed pursuant to Section 83(b) of the Internal Revenue Code of 1986, as amended.
9.    Failure to Enforce Not a Waiver.  The failure of the Company to enforce at any time any provision of this Agreement shall in no way be construed to be a waiver of such provision or of any other provision hereof.
10.    Amendment: Termination.  This Agreement may not be amended or terminated unless such amendment or termination is in writing and duly executed by each of the parties hereto.
11.    Counterparts.  This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all of which together shall constitute but one and the same instrument.
12.    Benefit and Binding Effect.  This Agreement shall be binding upon and shall inure to the benefit of the Company, its successors and assigns, and the Grantee, his executors, administrators, personal representatives and heirs.  In the event that any part of this Agreement shall be held to be invalid or unenforceable, the remaining parts hereof shall nevertheless continue to be valid and enforceable as though the invalid portions were not a part hereof.
13.    Entire Agreement.  This Agreement contains the entire understanding of the parties hereto with respect to the subject matter hereof and supersedes all prior agreements, discussions and understandings with respect to such subject matter.
14.    Governing Law.  This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the Commonwealth of Massachusetts, without giving effect to principles and provisions thereof relating to conflict or choice of laws.
15.    Electronic Delivery.  As an alternative to the delivery of stock certificates, the Company may deliver uncertificated shares by means of electronic book entry.
16.    Data Privacy Consent.  In order to administer the Plan and this Agreement and to implement or structure future equity grants, the Company, its subsidiaries and affiliates and certain agents thereof (together, the “Relevant Companies”) may process any and all personal or professional data, including but not limited to Social Security or other identification number, home address and telephone number, date of birth and other information that is 

                

necessary or desirable for the administration of the Plan and/or this Agreement (the “Relevant Information”).  By entering into this Agreement, the Grantee (i) authorizes the Company to collect, process, register and transfer to the Relevant Companies all Relevant Information; (ii) waives any privacy rights the Grantee may have with respect to the Relevant Information; (iii) authorizes the Relevant Companies to store and transmit such information in electronic form; and (iv) authorizes the transfer of the Relevant Information to any jurisdiction in which the Relevant Companies consider appropriate.  The Grantee shall have access to, and the right to change, the Relevant Information.  Relevant Information will only be used in accordance with applicable law.

[End of Agreement – Signatures on Cover Sheet]10.5 LoJack-ShortTermIncentivePlanDocument

EXHIBIT 10.5
LOJACK CORPORATION 
SHORT TERM INCENTIVE PLAN
		
	1.
	Purpose

This Short Term Incentive Plan (the “Incentive Plan”) is intended to provide an incentive to motivate eligible executives and other employees of LoJack Corporation (the “Company”) and its subsidiaries toward achievement of performance goals and business results, to tie their goals and interests to those of the Company and its shareholders, and to enable the Company to attract and retain highly qualified individuals.  The Incentive Plan is for the benefit of Covered Employees (as defined below).
		
	2.
	Covered Employees

From time to time, the Compensation Committee of the Board of Directors of the Company (the “Compensation Committee”) may select certain executives and other employees (the “Covered Employees”) to be eligible to receive cash bonuses hereunder.  Participation in this Plan does not change the “at will” nature of a Covered Employee’s employment with the Company.
		
	3.
	Administration

The Compensation Committee shall have the sole discretion and authority to administer and interpret the Incentive Plan.
		
	4.
	Bonus Determinations

(a)    Corporate Performance Goals.  A Covered Employee may receive a bonus payment under the Incentive Plan based upon the Company's attainment of one or more performance objectives that are established by the Compensation Committee and relate to financial and operational metrics with respect to the Company or any of its subsidiaries (the “Corporate Performance Goals”), including the following:  revenue; corporate revenue; earnings before interest, taxes, depreciation and amortization; net income (loss) (either before or after interest, taxes, depreciation and/or amortization); cash flow (including, but not limited to, operating cash flow and free cash flow); changes in the market price of the Company’s common stock; economic value-added; acquisitions or strategic transactions; operating income (loss); return on capital, assets, equity, or investment; shareholder returns; return on sales; gross or net profit levels; productivity; expense efficiency; margins; operating efficiency; customer satisfaction; working capital; earnings (loss) per share of the Company’s common stock; bookings, new bookings or renewals; sales or market shares; number of customers, number of new customers or customer references; operating income and/or net annual recurring revenue, any of which may be (i) measured in absolute terms or compared to any incremental increase, (ii) 

2013 LoJack Corporate Short Term Incentive Plan Document

measured in terms of growth, (iii) compared to another company or companies or to results of a peer group, (iv) measured against the market as a whole and/or as compared to applicable market indices and/or (v) measured on a pre-tax or post-tax basis (if applicable).  Further, any Corporate Performance Goals may be used to measure the performance of the Company as a whole or a business unit or other segment of the Company, or one or more product lines or specific markets, as practicable.  The Corporate Performance Goals may differ from Covered Employee to Covered Employee. 
(b)    Calculation of Corporate Performance Goals.  At the beginning of each applicable performance period, the Compensation Committee will determine whether any significant element(s) will be included in or excluded from the calculation of any Corporate Performance Goal with respect to any Covered Employee.  In all other respects, Corporate Performance Goals will be calculated in accordance with the Company’s financial statements, generally accepted accounting principles, or under a methodology established by the Compensation Committee at the beginning of the performance period and which is consistently applied with respect to a Corporate Performance Goal in the relevant performance period.  
(c)    Target; Minimum; Maximum.  Each Corporate Performance Goal shall have a “target” (100 percent attainment of the Corporate Performance Goal) and may also have a “minimum” threshold and/or a “maximum” level (for purposes of bonus determination). 
(d)    Bonus Requirements; Individual Goals.  Except as otherwise set forth in this Section 4(d):  (i) any bonuses paid to Covered Employees under the Incentive Plan shall be based upon objectively determinable bonus formulas that tie the amount, eligibility or funding for such bonuses to one or more performance targets relating to the Corporate Performance Goals; (ii) bonus formulas for Covered Employees shall be adopted in each performance period by the Compensation Committee and communicated to each Covered Employee at the beginning of each performance period; and (iii) no bonuses shall be paid to Covered Employees unless and until the Compensation Committee makes a determination with respect to the attainment of the performance targets relating to the Corporate Performance Goals.  Notwithstanding the foregoing once all the Corporate Performance Goals have been achieved at least at the minimum threshold level, the Compensation Committee may adjust bonuses payable under the Incentive Plan based on achievement of one or more individual performance objectives or goals and/or upon such other terms and conditions as the Compensation Committee may in its discretion determine.
(e)    Individual Target Bonuses.  The Compensation Committee shall establish target and maximum bonus opportunities for each Covered Employee for each performance period.  For each Covered Employee, the Compensation Committee shall have the authority to apportion the target award so that a portion of the target award shall be tied to attainment of Corporate Performance Goals and a portion of the target award shall be tied to attainment of individual performance objectives. 
(f)    Employment Requirement.  Subject to any additional terms contained in a written agreement between the Covered Employee and the Company, the payment of a bonus to a Covered Employee with respect to a performance period shall be conditioned upon the Covered Employee’s employment by the Company on the bonus payment date.  If a Covered Employee 

2013 LoJack Corporate Short Term Incentive Plan Document

was not employed or was not a Covered Employee for an entire performance period, the Compensation Committee may pro rate the bonus based on the number of days employed during such period.
		
	5.
	Timing of Payment

(a)    With respect to Corporate Performance Goals established and measured on a basis more frequently than annually (e.g., quarterly or semi-annually), the Corporate Performance Goals will be measured at the end of each performance period after the Company’s financial reports with respect to such period(s) have been published.  If the Corporate Performance Goals and/or individual goals for such period are met, payments will be made as soon as practicable following the end of such period, but not later than 74 days after the end of the fiscal year in which such performance period ends.
(b)    With respect to Corporate Performance Goals established and measured on an annual or multi-year basis, Corporate Performance Goals will be measured as of the end of each such performance period (e.g., the end of each fiscal year) after the Company’s financial reports with respect to such period(s) have been published.  If the Corporate Performance Goals and/ or individual goals for any such period are met, bonus payments will be made as soon as practicable, but not later than 74 days after the end of the relevant fiscal year.  
(c)    For the avoidance of doubt, bonuses earned at any time in a fiscal year must be paid no later than 74 days after the last day of such fiscal year.  
		
	6.
	Amendment and Termination

The Company reserves the right to amend or terminate the Incentive Plan at any time in its sole discretion.

2013 LoJack Corporate Short Term Incentive Plan Document

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