Document:

Exhibit 10.4

 

 
	
  

 	
  

 	
  

 
	
 Notice of
 Grant of Restricted Stock 

 Units And Restricted Stock Unit

 Agreement – Employee

 	
  

 	
 MTS SYSTEMS CORPORATION

 
	
  

 	
 ID: 41-0908057

 
	
  

 	
 14000 Technology Drive

 
	
  

 	
 Eden Prairie, MN 55344

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
 «First» «MI»
 «Last»

 	
  

 	
 Award Number:

 	
 «Number»

 
	
 «Address»

 	
  

 	
 Plan:

 	
 2011

 
	
 «M_2nd_Line»

 	
  

 	
 ID:

 	
 «ID»

 
	
 «City» «Rg» «Postal_code»

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
  

 	
  

 

Effective «Grant_date»,
you have been granted «Shares» Restricted Stock Units, representing the right
to receive shares of MTS SYSTEMS CORPORATION (the “Company”) common stock
pursuant to the Company’s 2011 Stock Incentive Plan (the
“Plan”), subject to vesting of the Units as set forth below.

Units under this Grant will vest on
the dates shown below, and are subject to earlier vesting as described in the Plan:

	
  

 	
  

 
	
 Number of Units

 	
 Vesting Date

 
	
 «SharesY1»

 	
 «DateY1»

 
	
 «SharesY2»

 	
 «DateY2»

 
	
 «SharesY2»

 	
 «DateY3»

 

By accepting this grant via this
website, you and the Company agree that the Restricted Stock Units evidenced by this
Restricted Stock Unit Agreement are subject to the following:

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 A.

 	
 This Agreement, the Units, and the Shares issuable upon the vesting of the Units
are governed by all the terms, provisions and conditions set forth in the
Company’s 2011 Stock Incentive Plan and by Uniform
Terms and Conditions Applicable to Employee Restricted Stock Units
Grants adopted by the Compensation Committee (the “Committee”) of
the Board of Directors of the Company, which are incorporated herein. 

                                      	
  

 
	
  

 	
 B.

 	
 Neither the Plan nor this Agreement confers any right with respect to
continuance of your services to the Company or any of its subsidiaries nor
restricts your right to terminate services to the Company at any time. 

 	
  

 
	
  

 	
 C.

 	
The Units and the shares of stock, whether or not vested, may be recouped at the
discretion of the Committee if certain events occur, including termination of
your services to the Company or you compete with the Company after termination
of your services in violation of your agreements with the Company, or upon
certain acts detrimental to the Company, as further described in the Plan.

 	
  

 
	
  

 	
 D.

 	
The Company may amend or terminate the Plan and this Agreement at any time,
provided that no such action shall impair any rights that have accrued under
this Agreement at the time of amendment or termination without your consent.

 	
  

 
	
  

 	
 E.

 	
This electronic document and your acceptance are the only evidence of this grant
and no paper copy will be sent to you to evidence the grant and your acceptance. 

 	
  

 

	
  

 	
  

 	
  

 
	
 

 	
  

 	
 «Grant_date»

 
	
 MTS SYSTEMS CORPORATION

 	
  

 	
 DateExhibit 10.5

	
  

 	
  

 
	
 

 	
 UNIFORM TERMS AND CONDITIONS APPLICABLE TO

 EMPLOYEE RESTRICTED STOCK UNIT GRANTS UNDER

 THE MTS SYSTEMS CORPORATION 2011 STOCK INCENTIVE PLAN

 

Pursuant to the authority set forth in
Section 5 of the MTS Systems Corporation 2011 Stock Incentive Plan (the “Plan”)
the Compensation Committee (the “Committee”) of the Board of Directors adopts the following terms and conditions to apply to any and all awards of
Restricted Stock Units granted under the Plan to employees (the “Participant”)
in addition to the terms set forth in the Plan (Section references are to
Sections of the Plan):

	
  

 	
  

 	
  

 	
  

 
	
  

 	
 1.

 	
 The terms and conditions set forth below govern the issuance to the
 Participant of the number of units (“Units”), which represent the right to
 receive shares of MTS Common Stock, $.25 par value per share (the “Shares”)
 set forth in a separate Notice of Grant of Restricted Stock Units (the
 “Notice”), and the issuance of Shares upon the vesting of the Units. This
 document and the Notice constitute the Restricted Stock Unit Agreement. 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 2.

 	
 The Units will vest in accordance with the date or dates set forth in
 the Notice, or upon an earlier date as set forth herein or as otherwise
 determined by the Committee; provided that the Participant is serving as an
 employee, director or consultant of MTS or its subsidiaries on the date on
 which occurs the event giving rise to the vesting. In the event that the
 Participant ceases to serve as an employee, director or consultant due to
 death or disability during the Restriction Period, all restrictions will
 immediately lapse (Section 7.1(f)). If the Participant ceases to serve as an
 employee, director or consultant during the Restriction Period for any reason
 other than death or disability, all Units that are not vested shall be
 forfeited to MTS, without payment.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 3.

 	
 Notwithstanding Paragraph 2 above, all Units that have not vested in
 accordance with the Notice shall immediately fully (100%) vest upon the
 occurrence of a Change in Control (as defined in the Plan) provided that the
 terms of the agreements effectuating the Change in Control do not provide for
 the assumption or substitution of the Units (Section 11.2).

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 4.

 	
 MTS shall, no later than 30 days from the date of vesting as to any
 Units shall make a book entry of the issuance of such Shares to the
 Participant on MTS’s stock records. Upon the request of the Participant, MTS
 shall deliver to the Participant certificated Shares representing the number
 of vested Shares in certificated form as requested. 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 5.

 	
 Until Shares are issued in settlement of the vested Units in
 accordance with Paragraph 4, the Participant will not be deemed for any
 purpose to be, or have rights as, a shareholder of MTS, or to exercise,
 directly or by proxy, voting rights or to receive dividends with respect to
 the Shares issuable prior to or concurrent with the vesting of the Units. In
 addition, the Participant will not be entitled to any dividend equivalents,
 in the form of cash, additional Units or Shares, with respect to the Units for
 the period prior to the settlement of the Units. From and after the date of
 settlement, the Participant shall have all rights and privileges of any other
 shareholder with respect to the Shares issued in settlement of the vested
 Units.

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 6.

 	
 MTS may make an equitable adjustment in the number of Units that have
 not vested in the event of any change in the capital structure of MTS,
 including but not limited to such changes as stock dividends or stock splits
 (Section 3.4). Any additional Units issued to the Participant as a result of
 any of the foregoing events shall continue to be subject to the terms set
 forth herein to the same extent as the Units giving rise to the right to
 receive such additional Units.

 
	
  

 	
  

 	
  

 
	
  

 	
 7.

 	
 Nothing in this Agreement shall modify or reduce the rights or
 discretions of the Committee set forth in the Plan, including but not limited
 to:

 
	
  

 	
  

 	
 a.

 	
 Modifying the Award to comply with tax laws or upon dissolution or
 liquidation of MTS (Section 12.3);

 
	
  

 	
  

 	
 b.

 	
 Requiring Shares to be held in escrow (Section 13.6); or

 
	
  

 	
  

 	
 c.

 	
 Amending the terms and conditions of any Award consistent with
 Section 12.3.

 

 

 

	
  

 	
  

 	
  

 
	
  

 	
 8.

 	
 As a condition to MTS’s obligation to issue Shares in settlement of
 the Units, the Participant shall pay or make arrangements for the payment of
 any required tax withholding applicable to the vesting and issuance of the
 Shares in settlement of any vested Units. The Participant may elect by
 written notice to MTS to satisfy part or all of any withholding tax
 requirements associated with the issuance of Shares by (a) authorizing MTS to
 retain from the number of Shares that would otherwise be issued to the
 Participant or (b) delivering to MTS from Shares already owned by the
 Participant that number of Shares having an aggregate Fair Market Value equal
 to part or all of the tax payable by the Participant under this Paragraph,
 and in the event Shares are withheld or delivered, the amount withheld shall
 not exceed the statutory minimum required federal, state FICA and other
 payroll taxes.

 
	
  

 	
  

 	
  

 
	
  

 	
 9.

 	
 The Units shall represent an unfunded promise to issue Shares in the
 future and Participant shall have no rights other than as a general creditor
 of MTS with respect to the issuance of Shares. Except as otherwise provided
 in Section 7.1(h), a Participant shall not sell, transfer, pledge, assign or
 otherwise encumber any of the Units, whether voluntarily, involuntarily or by
 operation of law. Any purported transfer, pledge or encumbrance of such Units
 shall be void and unenforceable against MTS, and no purported transferee
 shall acquire any right or interest with respect to the Shares as a result.

 
	
  

 	
  

 	
  

 
	
  

 	
 10.

 	
 If any Participant who is an employee is on: (a) a qualified military
 leave; (b) an MTS-approved leave of absence of less than 90 days; or (c) an
 MTS-approved leave of greater than 90 days and MTS is obligated by statute or
 written contract to re-employ the Participant at the end of the approved
 leave, and in any event, does not return to employment with MTS within 30
 days of the end of the approved leave, the Participant will incur a
 termination of employment for purposes of the Plan as of the last day of the
 approved leave. The Vice President of Human Resources of MTS has been
 delegated the authority to approve all leaves of absence and to enter into
 such contracts to provide for re-employment for purposes of the Plan (Section
 5.3).

 
	
  

 	
  

 	
  

 
	
  

 	
 11.

 	
 MTS shall cancel any Units, recover all or any portion of Shares
 issued under the Plan (or the proceeds thereof), and shall take such other
 action, including recovery out of other amounts paid or owing to the
 Participant, in an amount and under such conditions as required by law
 (Section 13.8).

 
	
  

 	
  

 	
  

 
	
  

 	
 12.

 	
 MTS may, in its sole discretion, reduce, cancel, forfeit or recoup
 any rights, payments or benefits paid or otherwise due to the Participant,
 including any Units and any Shares issued under the Plan for Cause (including
 termination of employment as a result), breach of any noncompetition,
 confidentiality, nonsolicitation, noninterference, corporate property protection
 or any other agreement between MTS and Participant or any other action of the
 Participant that the Committee deems detrimental to the business or
 reputation of MTS or any of its subsidiaries (Section 13.8). The Committee
 hereby delegates to the Chief Executive Officer the authority and discretion
 to exercise the rights under Section 13.8 with respect to Shares held by and
 Units and other payments paid or due to persons other than the executive
 officers of MTS.

 
	
  

 	
  

 	
  

 
	
  

 	
 13.

 	
 Nothing in this Agreement shall be construed as constituting a
 commitment, guaranty, agreement or understanding of any kind or nature that
 MTS or its subsidiaries will retain the services of the Participant as an
 employee, director or consultant, and this Agreement shall not affect in any
 way the right of MTS or its subsidiaries or the Participant to terminate the
 relationship as an employee, director or consultant at any time or for any
 reason in accordance with the procedures governing such termination, without
 any liability or claim under the Plan.

 
	
  

 	
  

 	
  

 
	
  

 	
 14.

 	
 The Committee shall exercise any authority and discretion in the
 interpretation of this Agreement in accordance with the terms of the Plan.
 This Agreement is intended to be exempt from the requirements of Section 409A
 of the Code and shall be construed and interpreted in accordance with such
 intent. Except as provided herein or as provided in the Plan, no payment
 shall be subject to further deferral except as otherwise permitted or
 required pursuant to regulations and other guidance issued pursuant to
 Section 409A of the Code. Any provision of this Agreement  

 

2

 

	
  

 	
  

 	
  

 
	
  

 	
  

 	
 that would fail to satisfy the exemption for a short-term deferral for
 purposes of Section 409A of the Code shall be amended to so comply on a
 timely basis.

 

Except to the extent specifically provided in this Agreement, this
 award shall be subject to and governed by the terms and conditions of the
 Plan, which shall be incorporated as though fully set forth herein. The
 foregoing terms and conditions shall remain in effect until further modified
 by action of the Committee, either in the form of a modification of these
 terms and conditions or by a written term or condition set forth in any
 individual award approved by the Committee subsequent to the date of adoption
 of these terms and conditions, provided that no change shall adversely affect
 any accrued right of the Participant without the Participant’s written
 consent.

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