Document:

Exhibit 10.18

TRIPADVISOR, INC. RESTRICTED STOCK UNIT AGREEMENT 

(Performance Based - Domestic) 

THIS RESTRICTED STOCK UNIT AGREEMENT (this “Agreement”), dated as of the grant date specified on the Grant Details referenced below (the “Grant Date”), between TripAdvisor, Inc., a Delaware corporation  (the “Company”), and the employee, director or consultant of the Company or one of its Subsidiaries or Affiliates designated on the Grant Details (the “Eligible Individual”), describes the terms of an award of restricted stock units (“Restricted Stock Units”) to the Eligible Individual by the Company. 

All capitalized terms used herein, to the extent not defined, shall have the meanings set forth in the Company’s 2011 Stock and Annual Incentive Plan (as amended from time to time, the “Plan”). 

	
1.
	
Award and Vesting of Restricted Stock Units 

(a)       Subject to the terms and conditions of this Agreement and the Plan and the Grant Details (as defined below), the Company hereby grants Restricted Stock Units to the Eligible Individual.  Reference is made to the “Grant Details” that can be found on the equity plan website of the current professional selected by the Company to administer the Plan (the “Plan Administrator”), currently located at www.netbenefits.fidelity.com (or any successor equity administration system selected by the Company to manage the Plan from time to time).  Your Grant Details, which sets forth the number of Restricted Stock Units granted to you by the Company, the Grant Date and the vesting schedule of the Restricted Stock Units (among other information), is hereby incorporated by reference into, and shall be read as part and parcel of, this Agreement. 

(b)       Subject to the terms and conditions of this Agreement, the Grant Details and the Plan, the Restricted Stock Units shall vest and no longer be subject to any restriction (such period during which restrictions apply shall be referred to as the “RSU Restriction Period”) if and to the extent that the performance goals specified in Appendix A hereto are satisfied. 

(c)       In the event a Termination of Employment of the Eligible Individual occurs during the RSU Restriction Period for any reason (or for no reason), all remaining unvested Restricted Stock Units shall be forfeited by the Eligible Individual and canceled in their entirety effective immediately as of the date of such Termination of Employment. 

(d)       Notwithstanding the provisions of Sections 1(b) and 1(c) above, in the event the Eligible Individual incurs a Termination of Employment by the Company or any Subsidiary or Affiliate for Cause, or the Eligible Individual voluntarily incurs a Termination of Employment within two years after any event or circumstance that would have been grounds for a Termination of Employment for Cause, the Eligible Individual’s Restricted Stock Units (whether or not vested) shall be forfeited and canceled in their entirety upon such Termination of Employment.  In such event, the Company may cause the Eligible Individual, immediately upon notice from the Company, to either (i) return the Shares issued upon settlement of Restricted Stock Units that vested during the two-year period after the events or circumstances giving rise to or constituting grounds for such Termination of Employment for Cause or (ii) pay to the Company an amount equal to the aggregate amount, if any, that the Eligible Individual had previously realized in respect of any and all Shares issued upon settlement of Restricted Stock Units that vested during the two-year period after the events or circumstances giving rise to or constituting grounds for such Termination of Employment for Cause (i.e., the value of the Restricted Stock Units upon vesting), in each case including any dividend equivalents or other distributions received in respect of any such Restricted Stock Units. 

(e)       For purposes of this Agreement, employment with the Company shall include employment with the Company’s Subsidiaries or Affiliates.  The Committee shall have the exclusive discretion to determine whether there has been any Termination of Employment and/or whether there existed Cause. 

	
2.
	
Settlement of Units 

As soon as practicable after any Restricted Stock Units have vested and are no longer subject to the RSU Restriction Period, such Restricted Stock Units shall be settled.  Subject to Section 8 (pertaining to the withholding of taxes), for each Restricted Stock Unit settled pursuant to this Section 2, the Company shall issue one Share for each vested Restricted Stock Unit and cause to be delivered to the Eligible Individual one or more unlegended, freely-transferable stock certificates in respect of such Shares issued upon settlement of the vested Restricted Stock Units.  Notwithstanding the foregoing, the Company shall be entitled to hold the Shares issuable upon settlement of Restricted Stock Units that have vested until the Company or the Plan Administrator shall have received from the Eligible Individual a duly executed Form W-9 or Form W-8, as applicable, as well as such other documents as may be legally required. 

 

 

	
3.
	
Non-Transferability of the Restricted Stock Units 

During the RSU Restriction Period and until such time as the Restricted Stock Units are settled as provided herein or on the website of the Plan Administrator, the Restricted Stock Units shall not be transferable by the Eligible Individual by means of sale, assignment, exchange, encumbrance, pledge, hedge or otherwise. 

	
4.
	
Rights as a Stockholder 

Except as otherwise specifically provided in this Agreement, during the RSU Restriction Period the Eligible Individual shall not be entitled to any rights of a stockholder with respect to the Restricted Stock Units.  Notwithstanding the foregoing, if the Company declares and pays dividends on the Common Stock during the RSU Restriction Period, the Eligible Individual will be credited with additional amounts for each Restricted Stock Unit equal to the dividend that would have been paid with respect to such Restricted Stock Unit if it had been an actual share of Common Stock, which amount shall remain subject to restrictions (and as determined by the Committee may be reinvested in Restricted Stock Units or may be held in kind as restricted property) and shall vest concurrently with the vesting of the Restricted Stock Units upon which such dividend equivalent amounts were paid.  Notwithstanding the foregoing, dividends and distributions other than regular cash dividends, if any, may result in an adjustment pursuant to Section 5 below, rather than under this Section 4. 

	
5.
	
Adjustment in the Event of Change in Stock; Change in Control 

(a)       In the event of (i) a stock dividend, stock split, reverse stock split, share combination or recapitalization or similar event affecting the capital structure of the Company (each, a “Share Change”), or (ii) a merger, consolidation, acquisition of property or shares, separation, spinoff, reorganization, stock rights offering, liquidation, Disaffiliation, payment of cash dividends other than an ordinary dividend or similar event affecting the Company or any of its Subsidiaries (each, a “Corporate Transaction”), the Committee or the Board may in its discretion make such substitutions or adjustments as it deems appropriate and equitable to the number of Restricted Stock Units and the number and kind of shares of Common Stock underlying the Restricted Stock Units. 

(b)       In the case of Corporate Transactions, such adjustments may include, without limitation (i) the cancellation of the Restricted Stock Units in exchange for payments of cash, property or a combination thereof having an aggregate value equal to the value of such Restricted Stock Units, as determined by the Committee or the Board in its sole discretion, (ii) the substitution of other property (including, without limitation, cash or other securities of the Company and securities of entities other than the Company) for the shares of Common Stock underlying the Restricted Stock Units and (iii) in connection with any Disaffiliation, arranging for the assumption of the Restricted Stock Units, or the replacement of the Restricted Stock Units with new Awards based on other property or other securities (including, without limitation, other securities of the Company and securities of entities other than the Company), by the affected Subsidiary or Affiliate or by the entity that controls such Subsidiary or Affiliate following such Disaffiliation (as well as any corresponding adjustments to any Restricted Stock Units that remain based upon securities of the Company). 

(c)       The determination of the Committee regarding any such adjustment will be final and conclusive and need not be the same for all Eligible Individuals. 

(d)       Unless otherwise determined by the Committee, in the event of a Change in Control, the provisions of Section 10 of the Plan shall apply. 

	
6.
	
Taxes, Fees and Withholding 

(a)       The Company agrees to pay any and all original issue taxes and stock transfer taxes that may be imposed on the issuance of shares received by an Eligible Individual in connection with the Restricted Stock Units, together with any and all other fees and expenses necessarily incurred by the Company in connection therewith. 

(b)       Regardless of any action the Company, its Affiliate or Subsidiary takes with respect to any or all income tax, social insurance, payroll tax, payment on account or other tax-related withholding (“Tax-Related Items”), the Eligible Individual acknowledges that the ultimate liability for all Tax-Related Items legally due by him or her is and remains the Eligible Individual’s responsibility and that the Company and/or its Affiliate or Subsidiary (i) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Award, including the grant and vesting of the Restricted Stock Units, the receipt of cash or any dividends or dividend equivalents; and (ii) do not commit to structure the terms of the Award or any aspect of the Restricted Stock Units to reduce or eliminate the Eligible Individual’s liability for Tax-Related Items. 

(c)       In the event that the Company, Subsidiary or Affiliate is required to withhold any Tax-Related Items as a result of the award or vesting of the Restricted Stock Units, or the receipt of cash or any dividends or dividend equivalents, the Eligible Individual 

 

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shall pay or make adequate arrangements satisfactory to the Company, Subsidiary or Affiliate to satisfy all withholding and payment on account of obligations of the Company, Subsidiary and/or Affiliate. The obligations of the  Company under this Agreement shall be conditioned on compliance by the Eligible Individual with this Section 6.  In this regard, the Eligible Individual authorizes the Company and/or its Subsidiary or Affiliate to withhold all applicable Tax-Related Items legally payable by the Eligible Individual from his or her wages or other cash compensation paid to the Eligible Individual by the  Company and/or its Subsidiary or Affiliate.  The Company may, in its sole discretion and pursuant to such provisions as it may specify from time to time, withhold in Shares the amount of Shares necessary to satisfy the minimum withholding amount or arrange for the sale of such number of Shares as is necessary to pay any Tax-Related Items.  In connection herewith, the Eligible Individual (i) authorizes, empowers and directs the Company and the Plan Administrator (or such brokerage firm as is contracted to manage the Company’s employee equity award program, the “Broker”) to sell, at the market price and on the Exercise Date or as soon thereafter as is practicable, the number of Shares sufficient to pay the Tax-Related Items, and (ii) agrees to indemnify and hold harmless the Broker and the Company from and against all losses, liabilities, damages, claims and expenses, including reasonable attorneys’ fees and court costs, arising out of carrying out such actions.   Finally, the Eligible Individual will pay to the  Company any amount of Tax-Related Items that the Company may be required to withhold as a result of the Eligible Individual’s participation in the Plan or the Eligible Individual’s Award that cannot be satisfied by the means previously described.  The Company may refuse to deliver the Shares underlying the Award if the Eligible Individual fails to comply with his or her obligations in connection with the Tax-Related Items as described in this Section. 

(d)       In particular, the Eligible Individual understands and acknowledges that all income to which the Eligible Individual is entitled under this Agreement is pre-tax and the Company or its Subsidiaries or Affiliates has the right to withhold and pay on behalf of the Eligible Individual any individual income tax in connection with such income in accordance with applicable law.  In the event the Company or its Subsidiaries or Affiliates is not required under applicable law to serve as the withholding agent to withhold and pay on behalf of the Eligible Individual such individual income tax, the Eligible Individual shall have sole responsibility to make such payment, in which case the Eligible Individual shall provide, as requested by the Company or its Subsidiaries or Affiliates from time to time, relevant tax receipts to certify full and prompt payment.  The Eligible Individual agrees to indemnify the Company and/or its Subsidiaries or Affiliates for any liability which may arise as a result of his or her failure to pay any and all taxes associated with any income derived pursuant to the Awards. 

	
7.
	
Other Restrictions 

(a)       The Award shall be subject to the requirement that, if at any time the Committee shall determine that (i) the listing, registration or qualification of the shares of Common Stock subject or related thereto upon any securities exchange or under any state or federal law, or (ii) the consent or approval of any government regulatory body is required, then in any such event, the Award shall not be effective unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Committee. 

(b)       The Eligible Individual acknowledges that the Eligible Individual is subject to the Company’s policies regarding compliance with securities laws, including but not limited to its Insider Trading Policy (as in effect from time to time and any successor policies), and, pursuant to these policies, if the Eligible Individual is on the Company’s insider list, the Eligible Individual shall be required to obtain pre-clearance from the Company’s General Counsel prior to purchasing or selling any of the Company’s securities, including any shares issued upon vesting of the Restricted Stock Units, and may be prohibited from selling such shares other than during an open trading window.  The Eligible Individual further acknowledges that, in its discretion, the Company may prohibit the Eligible Individual from selling such shares even during an open trading window if the Company has concerns over the potential for insider trading. 

	
8.
	
Nature of Award 

In accepting the Award, the Eligible Individual acknowledges that: 

(a)       the Plan is established voluntarily by the Company, it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time, unless otherwise provided in the Plan and this Agreement; 

(b)       the Award is voluntary and occasional and does not create any contractual or other right to receive future Awards, or benefits in lieu of Awards, even if Awards have been granted repeatedly in the past; 

(c)       all decisions with respect to future Awards, if any, will be at the sole discretion of the Company; 

 

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(d)       the Eligible Individual’s participation in the Plan will not create a right to further employment with the Company, its Subsidiary or Affiliate and shall not interfere with the ability of the Company to terminate the Eligible Individual’s employment relationship at any time with or without Cause; 

(e)       the Eligible Individual is voluntarily participating in the Plan; 

(f)        the Award is an extraordinary item that does not constitute compensation of any kind for services of any kind rendered to the Company, Subsidiary,  or Affiliate, and such Award is outside the scope of the Eligible Individual’s employment contract, if any; 

(g)       the Award is not part of normal or expected compensation or salary for any purposes, including, but not limited to, calculating any severance, resignation, termination, redundancy, end of service payments, bonuses, long-service awards, pension or retirement benefits or similar payments and in no event should be considered as compensation for, or relating in any way to, past services for the Company, Subsidiary or Affiliate; 

(h)       in the event that the Eligible Individual is not an employee of the Company, a Subsidiary or an Affiliate, the Award will not be interpreted to form an employment contract or relationship with the Company; and 

(i)        in consideration of the Award, no claim or entitlement to compensation or damages shall arise from termination of the Award or diminution in value of the Award resulting from Termination of the Eligible Individual’s Employment by the Company, Subsidiary or Affiliate (for any reason whatsoever and whether or not in breach of local labor laws) and the Eligible Individual irrevocably releases the Company, Subsidiary or Affiliate from any such claim that may arise; if, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen, then, by signing this Agreement, the Eligible Individual will be deemed irrevocably to have waived his or her entitlement to pursue such claim. 

	
9.
	
No Advice Regarding Grant. 

The Company is not providing any tax, legal or financial advice, nor is the Company making any recommendations regarding the Eligible Individual’s participation in the Plan, or his or her acquisition or sale of the underlying Shares.  The Eligible Individual is hereby advised to consult with his or her own personal tax, legal and financial advisors regarding the Eligible Individual’s participation in the Plan, receipt of the Award and/or disposition of the Award before taking any action related to the Plan or the Award. 

	
10.
	
Notices 

Any notices, communications or changes to this Agreement shall be communicated (either directly by the Company or indirectly through any of its Subsidiaries, Affiliates or the Plan Administrator) to the Eligible Individual electronically via email (or otherwise in writing) promptly after such change becomes effective. 

	
11.
	
Effect of Agreement; Severability 

Except as otherwise provided hereunder, this Agreement shall be binding upon and shall inure to the benefit of any successor or successors of the Company.  The invalidity or enforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement. 

	
12.
	
Laws Applicable to Construction; Consent to Jurisdiction 

(a)       The interpretation, performance and enforcement of this Agreement shall be governed by the laws of the State of Delaware without reference to principles of conflict of laws, as applied to contracts executed in and performed wholly within the State of Delaware.  In addition to the terms and conditions set forth in this Agreement, the Restricted Stock Units are subject to the terms and conditions of the Plan, which are hereby incorporated by reference. 

(b)       Any and all disputes arising under or out of this Agreement, including without limitation any issues involving the enforcement or interpretation of any of the provisions of this Agreement, shall be resolved by the commencement of an appropriate action in the state or federal courts located within the State of Delaware, which shall be the exclusive jurisdiction for the resolution of any such disputes.  The Eligible Individual hereby agrees and consents to the personal jurisdiction of said courts over the Eligible Individual for purposes of the resolution of any and all such disputes. 

 

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13.
	
Conflicts and Interpretation 

(a)       In the event of any (i) conflict between the Grant Details, this Agreement, any information posted on the system of the Plan Administrator and/or the books and records of the Company, or (ii) ambiguity in the Grant Details, this Agreement, any information posted on the system of the Plan Administrator and/or the books and records of the Company, the Plan shall control. 

(b)       The Committee shall have the power to interpret the Plan, this Agreement, the Grant Details, any information posted on the system of the Plan Administrator and/or the books and records of the Company, and to adopt such rules for the administration, interpretation and application of the Plan and the Award as are consistent therewith and to interpret or revoke any such rules (including, but not limited to, the determination of whether or not any Restricted Stock Units have vested).  All actions taken and all interpretations and determinations made by the Committee in good faith shall be final and binding upon the Eligible Individual, the Company and all other interested parties.  The Committee shall not be personally responsible for any action, determination or interpretation made in good faith with respect to the Plan or this Agreement.  The Committee shall, in their absolute discretion, determine when any conditions have been fulfilled. 

	
14.
	
Data Privacy 

(a)       The Eligible Individual understands that the Company, Subsidiary, Affiliate and/or Plan Administrator may hold certain personal information about him or her, including, but not limited to, the Eligible Individual’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any Shares or directorships held in the Company, details of all options or any other entitlement to shares of stock awarded, canceled, exercised, vested, unvested or outstanding in the Eligible Individual’s favor, for the purpose of implementing, administering and managing the Plan (“Data”).   The Eligible Individual hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of his or her Data as described in this document by and among, as applicable, the Company and its Subsidiaries  or Affiliates for the exclusive purpose of implementing, administering and managing the Eligible Individual’s participation in the Plan. 

(b)       The Eligible Individual understands that Data will be transferred to the Plan Administrator, or such other stock plan service provider as may be selected by the Company in the future, which is assisting the Company with the implementation, administration and management of the Plan.  The Eligible Individual understands that the recipients of the Data may be located in the United States or elsewhere, and that the recipients’ country may have different data privacy laws and protections than the Eligible Individual’s country.  The Eligible Individual authorizes the Company, its Subsidiary or Affiliate, the Plan Administrator and any other possible recipients which may assist the Company (presently or in the future) with implementing, administering and managing the Plan to receive, possess, use, retain and transfer the Data, in electronic or other form, for the sole purpose of implementing, administering and managing the Eligible Individual’s participation in the Plan. 

(c)       The Eligible Individual understands that he or she may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing the Eligible Individual’s local human resources representative.  The Eligible Individual understands, however, that refusing or withdrawing his or her consent may affect the Eligible Individual’s ability to participate in the Plan.  For more information on the consequences of the Eligible Individual’s refusal to consent or withdrawal of consent, the Eligible Individual understands that he or she may contact his or her local human resources representative. 

	
15.
	
Amendment 

(a)       This Agreement, including Appendix A, constitutes the entire agreement between the parties with respect to the Restricted Stock Unit award, and supersedes all prior agreements, understandings, and communications between the parties, whether oral or written, relating to the same subject matter. 

(b)       The Company may modify, amend or waive the terms of the Restricted Stock Unit award, prospectively or retroactively, but no such modification, amendment or waiver shall impair the rights of the Eligible Individual without his or her consent, except as required by applicable law, NASDAQ or stock exchange rules, tax rules or accounting rules.  The waiver by either party of compliance with any provision of this Agreement shall not operate or be construed as a waiver of any other provision of this Agreement, or of any subsequent breach by such party of a provision of this Agreement. 

(c)       This Award and payments made pursuant to this Agreement and the Plan are intended to qualify for an exemption from Section 409A of the Code. If the Company makes a good faith determination that any compensation provided under this Agreement is likely to be subject to the additional tax imposed by Section 409A, the Company may, to the extent it deems necessary or advisable, modify this Agreement, without the Eligible Individual’s consent, to reduce the risk that such additional tax will apply, in a manner designed to preserve the material economic benefits intended to be provided to the Eligible Individual under this Agreement 

 

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(other than any diminution of such benefit that may be attributable to the time value of money resulting from a delay in the timing of payments hereunder for a period of approximately six months or such longer period as may be required). 

	
16.
	
Choice of Language 

The Eligible Individual has received this Agreement and any other related communications and consents to having received these documents solely in English.  If, however, the Eligible Individual receives this or any other document related to the Plan translated into a language other than English and if the translated version is different than the English version in any way, the English version will control. 

	
17.
	
Electronic Delivery 

The Company may, in its sole discretion, decide to deliver any documents related to the Award and participation in the Plan or future Awards that may be awarded under the Plan by electronic means or to request the Eligible Individual’s consent to participate in the Plan by electronic means.  The Eligible Individual hereby consents to receive such documents by electronic delivery and, if requested, to agree to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company. 

By electronically accepting this Agreement and participating in the Plan, the Eligible Individual agrees to be bound by the terms and conditions of the Plan and this Agreement, including the Grant Details.  If Eligible Individual has not electronically accepted this Agreement on the Plan Administrator’s website within six months of the Grant Date, then this Award shall automatically by deemed accepted and Eligible Individual shall be bound by the terms and conditions in the Plan, this Agreement, including the Grant Details. 

 

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7DBD 12.31.2014 EX-10.17(ii)

Exhibit 10.17(ii)

Deferred Shares Agreement
WHEREAS, __________________ (hereinafter called the “Grantee”) is a Non-Employee Director of Diebold, Incorporated (hereinafter called the “Corporation”); and
WHEREAS, the execution of a Deferred Shares Agreement (hereinafter called the “Agreement”) substantially in the form hereof has been authorized by a resolution of the Board of Directors of the Corporation (the “Board”) duly adopted on ______________ (the “Date of Grant”).
NOW, THEREFORE, the Corporation hereby confirms to the Grantee, effective as of the Date of Grant, pursuant to the Corporation’s Amended and Restated 1991 Equity and Performance Incentive Plan (as amended and restated as of April 24, 2014) (the “Plan”), the grant of _________ Deferred Shares subject to the terms and conditions of the Plan and the terms and conditions described below.
		
	1.
	Definitions.

Capitalized terms used herein without definition shall have the meanings assigned to them in the Plan.  As used in this Agreement:
		
	(a)
	A “Change in Control” shall be deemed to have occurred if any of the following events shall occur: 

		
	(i)
	The acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (a “Person”) of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 30% or more of either: (A) the then-outstanding shares of common stock of the Corporation (the “Corporation Common Stock”) or (B) the combined voting power of the then-outstanding voting securities of the Corporation entitled to vote generally in the election of directors (“Voting Stock”); provided, however, that for purposes of this subsection (i), the following acquisitions shall not constitute a Change in Control: (1) any acquisition directly from the Corporation, (2) any acquisition by the Corporation, (3) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Corporation or any Subsidiary of the Corporation, or (4) any acquisition by any Person pursuant to a transaction which complies with clauses (A), (B) and (C) of subsection (iii) of this Section 1(a); or

		
	(ii)
	Individuals who, as of the date hereof, constitute the Board (as modified by this subsection (ii), the “Incumbent Board”) cease for any reason (other than death or disability) to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Corporation’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board (either by a specific vote or by approval of the proxy statement of the Corporation in which such person is named as a nominee for director, without objection to such nomination) shall be considered as though such individual were a member of the Incumbent Board, but excluding for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened 

solicitation of proxies or consents by or on behalf of a Person other than the Board; or
		
	(iii)
	Consummation of a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Corporation (a “Business Combination”), in each case, unless, following such Business Combination, (A) all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Corporation Common Stock and Voting Stock immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of, respectively, the then-outstanding shares of common stock and the combined voting power of the then-outstanding voting securities entitled to vote generally in the election of directors, as the case may be, of the entity resulting from such Business Combination (including, without limitation, an entity which as a result of such transaction owns the Corporation or all or substantially all of the Corporation’s assets either directly or through one or more subsidiaries) in substantially the same proportions relative to each other as their ownership, immediately prior to such Business Combination, of the Corporation Common Stock and Voting Stock of the Corporation, as the case may be, (B) no Person (excluding any entity resulting from such Business Combination or any employee benefit plan (or related trust) sponsored or maintained by the Corporation or such entity resulting from such Business Combination) beneficially owns, directly or indirectly, 30% or more of, respectively, the then-outstanding shares of common stock of the entity resulting from such Business Combination, or the combined voting power of the then-outstanding voting securities of such corporation except to the extent that such ownership existed prior to the Business Combination and (C) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement, or of the action of the Board providing for such Business Combination; or

		
	(iv)
	Approval by the shareholders of the Corporation of a complete liquidation or dissolution of the Corporation.

		
	(b)
	“Deferral Period” means the period commencing on the Date of Grant and ending on the Vesting Date (defined below).    

		
	2.
	Vesting of Deferred Shares.

		
	(a)
	General.  Subject to the terms and conditions of Section 2(b), (c), (d) and (e) hereof, the Grantee’s right to receive Deferred Shares under this Agreement shall become nonforfeitable on the first anniversary of the Date of Grant (the “Vesting Date”).  Except as provided below, if Grantee terminates services prior to the Vesting Date, his or her Deferred Shares granted under this Agreement will be forfeited.

		
	(b)
	Effect of Change in Control.  In the event of (i) a Change in Control after the Date of Grant but prior to the Vesting Date and (ii) prior to the Vesting Date, the Grantee’s service as a Non-Employee Director of the Corporation terminates (A) in connection with a request made by the Corporation or the Board that the Grantee resign as a Non-Employee Director or (B) as a result of the Grantee not being nominated for re-election as a Non-Employee Director in connection with the Change in Control, then the Deferred Shares granted hereby shall immediately become nonforfeitable.  Notwithstanding anything in this Section 2(b) to the contrary, in connection with a Business Combination the result of which is that 

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the Corporation Common Stock and Voting Stock is exchanged for or becomes exchangeable for securities of another entity, cash or a combination thereof, if the entity resulting from such Business Combination does not assume the Deferred Shares confirmed hereby and the Corporation’s obligations hereunder, or replace the Deferred Shares confirmed hereby with a substantially equivalent security of the entity resulting from such Business Combination, then the Deferred Shares granted hereby shall immediately become nonforfeitable as of immediately prior to such Business Combination.
		
	(c)
	Effect of Death, Disability.  If the Grantee dies or becomes disabled (which shall mean that Grantee is no longer able to perform the duties of a Director on account of a medically determinable physical or mental impairment) prior to the Vesting Date, the Deferred Shares granted hereby shall immediately become nonforfeitable.

		
	(d)
	Effect of Retirement.  If the Grantee’s service as a Non-Employee Director should terminate prior to the Vesting Date when he or she has served as a Director for ten full years or more or attained age 72, the Deferred Shares granted hereby shall become immediately nonforfeitable.

		
	(e)
	Effect of Other Termination of Service.  In the event that the Grantee’s service as a Non-Employee Director shall terminate prior to the Vesting Date in a manner other than any specified in Section 2(b), 2(c) or 2(d) hereof, the Grantee shall forfeit any Deferred Shares that have not become nonforfeitable by such Grantee at the time of such termination; provided, however, that the Board upon recommendation of the Board Governance Committee may order that any part or all of such Deferred Shares become nonforfeitable.

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3.Issuance of Common Shares.  
Except as otherwise provided in Section 7 hereof, the Deferred Shares granted hereby, to the extent vested, shall be issued to the Grantee in the form of Common Shares at the end of the Deferral Period, provided, however, that (a) in the event of the death of the Grantee, the Common Shares shall be issued at the time of such event, (b) in the event the Grantee experiences a “separation from service” as so defined for purposes of Section 409A(a)(2)(A)(i) of the Code, the Common Shares to the extent nonforfeitable shall be issued at the time of such “separation from service.”
		
	4.
	Payment of Dividend Equivalents.

During the Deferral Period, from and after the Date of Grant and until the earlier of (a) the time when Common Shares are issued in accordance with Section 3 hereof, or (b) the time when the Deferred Shares are forfeited in accordance with Section 2(e) hereof, provided that the Grantee holds the Deferred Shares on the applicable record date, the Corporation shall pay to the Grantee, whenever a dividend is paid on Common Shares (or at such later time as may be consistent with the Corporation’s administrative requirements), an amount of cash equal to the product of the per-share amount of the dividend paid times the number of such Deferred Shares.
		
	5.
	Deferred Shares Non-Transferable.

Neither the Deferred Shares granted hereby nor any interest therein or in the Common Shares related thereto shall be transferable other than by will or the laws of descent and distribution prior to payment.
		
	6.
	Dilution and Other Adjustments.

In the event of any change in the aggregate number of outstanding Common Shares by reason of (a) any stock dividend, stock split, combination of shares, recapitalization or other change in the capital structure of the Corporation, or (b) any merger, consolidation, spin-off, split-off, spin-out, split-up, reorganization, partial or complete liquidation or other distribution of assets, issuance of rights or warrants to purchase securities, or (c) any other corporate transaction or event having an effect similar to any of the foregoing, then the Board shall adjust the number of Deferred Shares then held by the Grantee in such manner as to prevent the dilution or enlargement of the rights of the Grantee that would otherwise result from such event.  Furthermore, in the event that any transaction or event described or referred to in the immediately preceding sentence shall occur, the Board may provide in substitution of any or all of the Grantee’s rights under this Agreement such alternative consideration as the Board may determine in good faith to be equitable under the circumstances.  Such adjustments made by the Board shall be conclusive and binding for all purposes of this Agreement.
		
	7.
	Compliance with Section 409A of the Code.

To the extent applicable, it is intended that this Agreement and the Plan comply with the provisions of Section 409A of the Code, so that the income inclusion provisions of Section 409A(a)(1) do not apply to the Grantee.  This Agreement and the Plan shall be administered in a manner consistent with this intent.
		
	8.
	Becoming an Employee.

If the Grantee becomes an employee of the Corporation or a Subsidiary after the Date of Grant while remaining a member of the Board of Directors of the Corporation, any Deferred Shares held by the Grantee at the time of commencement of such employment shall not be affected thereby.

4

		
	9.
	Stock Ownership Guidelines.

If Grantee is remains subject to the Stock Ownership Guidelines for Directors (as established by the Board of Directors from time to time) at the time Common Shares are delivered under this Agreement, Grantee may liquidate up to 40% of the Common Shares to cover any tax liabilities related to the distribution of Common Shares or inclusion of Deferred Shares in income under Code Section 409A. 
		
	10.
	Plan.

This Agreement is subject to the terms and conditions of the Plan.
		
	11.
	Amendments.

Any amendment to the Plan shall be deemed to be an amendment to this Agreement to the extent that the amendment is applicable hereto; provided, however, that no amendment shall adversely affect the rights of the Grantee with respect to Deferred Shares without the Grantee’s consent.
		
	12.
	Validity.

If any provision of this Agreement or the application of any provision hereof to any person or circumstances is held invalid, unenforceable or otherwise illegal, the remainder of this Agreement and the application of such provision in any other person or circumstances shall not be affected, and the provisions so held to be invalid, unenforceable or otherwise illegal shall be reformed to the extent (and only to the extent) necessary to make it enforceable, valid and legal.
		
	13.
	Governing Law.

This Agreement is made under, and shall be construed in accordance with, the internal substantive laws of the State of Ohio. 
The undersigned hereby acknowledges receipt of an executed original of this Agreement and accepts the Deferred Shares granted hereunder on the terms and conditions set forth herein and in the Plan.  

	
				
	Date:
	 
	 
	 

	 
	 
	 
	 

Executed in the name and on behalf of the Corporation at North Canton, Ohio as of the ____ day of ________________________, 20____.

DIEBOLD, INCORPORATED
                            

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