Document:

Exhibti 10.20

 

INCENTIVE
UNIT GRANT AGREEMENT

 

THIS INCENTIVE UNIT GRANT
AGREEMENT is made as of                 ,
2007 (the “Agreement”),
by and between STR Holdings LLC, a Delaware limited liability company (the “Company”)
and                             
(the “Grantee”).

 

W I T N E S S E T H :

 

WHEREAS, the Grantee has
entered into an agreement with Specialized Technology Resources, Inc.
effective as of June 15, 2007 whereby the Grantee has agreed to render
services to Specialized Technology Resources, Inc. and its affiliates,
including the Company.

 

WHEREAS, in exchange for the
services to be rendered to or for the benefit of the Company by the Grantee,
the Company desires to issue and grant to the Grantee Incentive Units, on the
terms and conditions set forth in this Agreement and in the Amended and
Restated Limited Liability Company Agreement of the Company, dated as of the
date hereof (as the same may be amended, restated, supplemented or otherwise
modified from time to time in accordance with the terms thereof, the “LLC
Agreement”), a copy of which has been furnished to the Grantee.

 

NOW, THEREFORE, in order to
implement the foregoing and in consideration of the mutual representations,
warranties, covenants and agreements contained herein and for other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto, intending to be legally bound, hereby agree
as follows:

 

1.                                       Issuance and
Grant.  Pursuant to the terms and
subject to the conditions set forth in this Agreement and the LLC Agreement,
the Company hereby agrees to issue and grant to the Grantee                   
Class      Units (collectively, the “Incentive
Units”).  The Company agrees the
Grantee’s provision of services to or for the benefit of the Company
constitutes sufficient consideration for the Incentive Units.  Capitalized terms used in this Agreement and
not otherwise defined in this Agreement shall have the meanings assigned to
them in the LLC Agreement.

 

2.                                       Vesting.  The Incentive Units shall vest in accordance
with the LLC Agreement. The grant of the Incentive Units shall occur on the
date hereof (the “Closing Date”) and vesting with respect to time shall
begin on the Closing Date.

 

3.                                       Section 83(b) Election.  Within 10 days after the date hereof, Grantee
shall timely file (via certified mail, return receipt requested) with the
Internal Revenue Service a completed election under Section 83(b) of
the Code and the regulations promulgated thereunder in the form of Exhibit A
attached hereto.  The Employee shall
provide the Company with proof of such timely filing.

 

4.                                       Representations
and Warranties of the Company.  The Company hereby represents and warrants to
each Grantee as follows:

 

(a)       The Company is a limited liability
company, duly organized, existing and in good standing, under the laws of its
state of formation.

 

 

(b)      The Company has
full limited liability company power and authority to enter into and perform
this Agreement.  The execution, delivery
and performance of this Agreement by the Company has been duly and validly
approved by the Company.  This Agreement
has been duly executed and delivered by the Company and constitutes a legal,
valid and binding agreement of the Company, enforceable against Company in
accordance with its terms.

 

(c)       When issued and
delivered in accordance with this Agreement, the Incentive Units will be duly
authorized, validly issued, fully paid and nonassessable and will be free of
all preemptive rights and any other liens, claims, charges and other encumbrances
other than restrictions on transfer under the LLC Agreement and applicable
federal and state securities laws.

 

5.                                       Representations
and Warranties of the Grantee.  The Grantee hereby represents and warrants to
the Company that:

 

(a)       Grantee has the
power and authority to enter into and perform this Agreement and this Agreement
constitutes a valid and legally binding obligation of the Grantee.

 

(b)      Grantee is in a financial position to hold
the Incentive Units for an indefinite period of time and is able to bear the
economic risk and withstand a complete loss of Grantee’s investment in the
Incentive Units.

 

(c)       Grantee believes Grantee,
either alone or with the assistance of Grantee’s own professional advisor, has
such knowledge and experience in financial and business matters that Grantee is
capable of reading and interpreting financial statements and evaluating the
merits and risks of the prospective investment in the Incentive Units and has
the net worth to undertake such risks.

 

(d)      Grantee has obtained, to the
extent Grantee deems necessary, Grantee’s own personal professional advice with
respect to the tax consequences of receiving, and the risks inherent in, the
investment in the Incentive Units, and the suitability of an investment in the
Incentive Units in light of the Grantee’s financial condition and investment
needs.

 

(e)       Grantee believes that the
investment in the Incentive Units is suitable for the Grantee based upon
Grantee’s investment objectives and financial needs, and Grantee has adequate
means for providing for the Grantee’s current financial needs and personal
contingencies and has no need for liquidity of investment with respect to the
Incentive Units.

 

(f)       The Grantee has had, prior
to his purchase of the Incentive Units, been furnished with, and has carefully
read, the LLC Agreement, and Grantee has been given access to full and complete
information regarding the Issuer and the Company and has utilized such access
to Grantee’s satisfaction for the purpose of obtaining information Grantee
believes to be relevant in making its investment decision and, particularly,
Grantee has either attended or been given reasonable opportunity to attend a
meeting with representatives of the Company for the purpose of asking questions
of, and receiving answers from, such representatives concerning the Company and
to obtain any additional information, to the extent reasonably available,
Grantee believes to be relevant in making its investment decision;

 

2

 

(g)      Grantee recognizes that an
investment in the Incentive Units involves a high degree of risk, including,
but not limited to, the risk of economic losses from operations of the Company.

 

(h)      Grantee realizes that (i) the
acquisition of the Incentive Units is a long-term investment; (ii) the
purchaser of the Incentive Units must bear the economic risk of investment for
an indefinite period of time because the Incentive Units have not been
registered under the Incentive Units Act of 1933, as amended (the “Securities
Act”), or under the securities laws of any state and, therefore, none of
such Incentive Units can be sold unless they are subsequently registered under
said laws or exemptions from such registrations are available, and there can be
no assurance that any such registration will be effected at any time in the
future; (iii) Grantee may not be able to liquidate Grantee’s investment in
the event of an emergency or pledge any of such Incentive Units as collateral
for loans; and the transferability of the Incentive Units is restricted in
accordance with the LLC Agreement.

 

(i)        Grantee is a bona fide
resident of, is domiciled in and received the offer and made the decision to
invest in the Incentive Units in the state set forth on the signature page below
under “Address,” and the Incentive Units are being accepted by Grantee in
Grantee’s name solely for Grantee’s own beneficial interest and not as nominee
for, or on behalf of, or for the beneficial interest of, or with the intention
to transfer to, any other person, trust or organization.

 

(j)        Grantee has not retained any
finder, broker, agent, financial advisor, Purchaser Representative (as defined
in Rule 501(h) of Regulation D of the Securities Act) or other
intermediary in connection with the transactions contemplated by this Agreement
and agrees to indemnify and hold harmless the Company from any liability for
any compensation to any such intermediary retained by Grantee and the fees and
expenses of defending against such liability or alleged liability.

 

(k)       Grantee has completed Schedule
A to this Agreement as to his/her status as an “Accredited Grantee”
(as defined therein) and such information is true and complete.

 

(l)        The Grantee agrees promptly
to notify the Company should the Grantee become aware of any change in the
information set forth in this Section 5.

 

6.                                 Conditions to
Obligations of the Company.  The obligations of the Company to grant the Incentive Units are subject to
the satisfaction of the following conditions: (i) the representations and
warranties of the Grantee contained in Section 5 of this Agreement shall
be true and correct on and as of the Closing Date in all respects; (ii) and
the Grantee shall have entered into the LLC Agreement prior to or concurrently
with the Closing.

 

7.                                 Authority of
the Board of Managers.  All
decisions, interpretations and other actions of the Board of Managers and/or
any committee designated by the Board of Managers, shall be final and binding
on the Grantee and other persons deriving their rights from the Grantee.  Without
limiting the generality of the foregoing, the Board of Managers and/or
any committee designated by the Board of Managers may, in its sole discretion, clarify, construe or resolve any ambiguity
in any provision of this Agreement, accelerate vesting, or waive any terms or
conditions applicable to any Incentive Units.

 

3

 

8.                                 Counterparts.  This Agreement may be executed in one or more
counterparts, each of which shall be considered an original, but all of which
taken together shall constitute one and the same Agreement.

 

9.                                 Employment
Rights.  Neither this Agreement nor any
of its provisions is intended to confer or should be construed as conferring
any rights on the Grantee to continued employment with the Company or any
rights of employment for a fixed term. 
No contract of employment, express or implied, is created hereby and
nothing contained herein shall be construed as creating a joint venture,
partnership, agency or other enterprise between the parties.

 

10.                           No Waiver;
Modifications in Writing.  This
Agreement, together with the LLC Agreement and the other agreements referred to
herein and therein and any exhibits, schedules or other documents referred to
herein or therein, sets forth the entire understanding of the parties, and
supersedes all prior agreements, arrangements, term sheets, presentations and
communications, whether oral or written, with respect to the specific subject
matter hereof.  No waiver of or consent
to any departure from any provision of this Agreement shall be effective unless
signed in writing by the party entitled to the benefit thereof; provided,
however, that the Company may amend, modify or terminate the Incentive Units
accordance with the terms in the LLC Agreement.

 

11.                           Indemnification.  The Grantee will, to the fullest extent
permitted by applicable law, indemnify the Company and each member, manager,
officer and employee (each an “Indemnitee”) against any losses, claims,
damages or liabilities to which any of them may become subject in any capacity
in any action, proceeding or investigation arising out of or based upon any
false representation or warranty, or breach or failure by the Grantee to comply
with any covenant or agreement made by the Grantee herein.  The Grantee will reimburse each Indemnitee
for reasonable legal and other expenses (including the cost of any
investigation and preparation) as they are incurred in connection with any such
action, proceeding or investigation (whether incurred between any Indemnitee
and the Grantee, or between any Indemnitee and any third party).  The reimbursement and indemnity obligations
of the Grantee under this Section 9 will survive the Closing Date and will
be in addition to any liability which the Grantee may otherwise have
(including, without limitation, liabilities under the LLC Agreement), and will
be binding upon and inure to the benefit of any successors, assigns, heirs,
estates, executors, administrators and personal representatives of any
Indemnitee.

 

12.                           Binding Effect;
Assignment.  The rights
and obligations of each party under this Agreement may not be assigned to any
other person or entity.  Except as
expressly provided in this Agreement, this Agreement shall not be construed so
as to confer any right or benefit upon any person or entity other than the
parties to this Agreement, and their respective successors and assigns.  This Agreement shall be binding upon the
Company, the Grantee and their respective heirs, successors, legal
representatives and permitted assigns.

 

13.                           Severability of
Provisions.  Any
provision of this Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction.

 

14.                           Conflict with
Other Agreements.  For so long
as the LLC Agreement is in full force and effect, this plan shall be subject to
the provisions of the LLC Agreement.  To
the extent any of the provisions of this Agreement conflict or are inconsistent
with any of the provisions of the LLC Agreement, the LLC Agreement shall
control.

 

4

 

15.                           Schedules and
Descriptive Headings.  All
Schedules to this Agreement shall be deemed to be a part of this
Agreement.  The descriptive headings of
this Agreement are inserted for convenience only and do not constitute a part
of this Agreement.

 

16.                           Governing Law.  This Agreement, and all disputes, claims or
causes of action that arise from or are in connection with this Agreement,
shall be governed by and construed in accordance with the domestic substantive
laws of the State of New York without giving effect to any choice or conflict
of law provision or rule that would cause the application of the domestic
substantive laws of any other jurisdiction.

 

[The
remainder of this page has been intentionally left blank.]

 

5

 

IN WITNESS WHEREOF, the
Grantee has executed this Agreement as of the date first written above.

 

 

	
   

  	
  [                                          ]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

 

ACCEPTED AND AGREED,

as of the date first written above:

 

 

STR
HOLDINGS LLC

 

 

	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:Exhibit 10.21

 

INCENTIVE UNIT GRANT AGREEMENT

 

THIS INCENTIVE UNIT GRANT AGREEMENT is made as of June 15,
2007 (the “Agreement”), by and between STR Holdings LLC, a Delaware limited liability
company (the “Company”) and                             (the “Grantee”).

 

W I T N E S S E T H :

 

WHEREAS, the Grantee has agreed to render services
to Specialized Technology Resources, Inc. and its affiliates, including
the Company.

 

WHEREAS, in exchange for the services to be rendered
to or for the benefit of the Company by the Grantee, the Company desires to
issue and grant to the Grantee Incentive Units, on the terms and conditions set
forth in this Agreement and in the Amended and Restated Limited Liability
Company Agreement of the Company, dated as of the date hereof (as the same may
be amended, restated, supplemented or otherwise modified from time to time in
accordance with the terms thereof, the “LLC Agreement”), a copy of which
has been furnished to the Grantee.

 

NOW, THEREFORE, in order to implement the foregoing
and in consideration of the mutual representations, warranties, covenants and
agreements contained herein and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:

 

1.                                       Issuance and
Grant.  Pursuant to the terms and
subject to the conditions set forth in this Agreement and the LLC Agreement,
the Company hereby agrees to issue and grant to the Grantee                     
Class F Units (the “Incentive Units”).  The Company agrees the Grantee’s provision of
services to or for the benefit of the Company constitutes sufficient
consideration for the Incentive Units. 
Capitalized terms used in this Agreement and not otherwise defined in
this Agreement shall have the meanings assigned to them in the LLC Agreement.

 

2.                                       Vesting.  The Incentive Units shall vest in accordance
with the LLC Agreement. The grant of the Incentive Units shall occur on the
date hereof (the “Closing Date”) and vesting with respect to time shall
begin on the Closing Date.

 

3.                                       Section 83(b) Election.  Within 10 days after the date hereof, Grantee
shall timely file (via certified mail, return receipt requested) with the
Internal Revenue Service a completed election under Section 83(b) of
the Code and the regulations promulgated thereunder in the form of Exhibit A
attached hereto.  The Employee shall
provide the Company with proof of such timely filing.

 

4.                                       Management
Member.  For purposes of the LLC
Agreement, the Grantee will not under any circumstance be deemed a Management
Member.

 

5.                                       Representations
and Warranties of the Company.  The Company hereby represents and warrants to
each Grantee as follows:

 

 

(a)       The Company is a limited
liability company, duly organized, existing and in good standing, under the
laws of its state of formation.

 

(b)      The Company has full
corporate power and authority to enter into and perform this Agreement.  The execution, delivery and performance of
this Agreement by the Company has been duly and validly approved by the
Company.  This Agreement has been duly
executed and delivered by the Company and constitutes a legal, valid and
binding agreement of the Company, enforceable against Company in accordance with
its terms.

 

(c)       When issued and delivered in
accordance with this Agreement, the Incentive Units will be duly authorized,
validly issued, fully paid and nonassessable and will be free of all preemptive
rights and any other liens, claims, charges and other encumbrances other than
restrictions on transfer under the LLC Agreement and applicable federal and
state Incentive Units laws.

 

6.                                       Representations
and Warranties of the Grantee.  The Grantee hereby represents and warrants to
the Company that:

 

(a)       Grantee has the power and
authority to enter into and perform this Agreement and this Agreement
constitutes a valid and legally binding obligation of the Grantee.

 

(b)      Grantee is in a financial
position to hold the Incentive Units for an indefinite period of time and is
able to bear the economic risk and withstand a complete loss of Grantee’s
investment in the Incentive Units.

 

(c)       Grantee believes Grantee,
either alone or with the assistance of Grantee’s own professional advisor, has
such knowledge and experience in financial and business matters that Grantee is
capable of reading and interpreting financial statements and evaluating the
merits and risks of the prospective investment in the Incentive Units and has
the net worth to undertake such risks.

 

(d)      Grantee has obtained, to the
extent Grantee deems necessary, Grantee’s own personal professional advice with
respect to the tax consequences of receiving, and the risks inherent in, the
investment in the Incentive Units, and the suitability of an investment in the
Incentive Units in light of the Grantee’s financial condition and investment
needs.

 

(e)       Grantee believes that the
investment in the Incentive Units is suitable for the Grantee based upon
Grantee’s investment objectives and financial needs, and Grantee has adequate
means for providing for the Grantee’s current financial needs and personal
contingencies and has no need for liquidity of investment with respect to the
Incentive Units.

 

(f)       The Grantee has had, prior
to his purchase of the Incentive Units, been furnished with, and has carefully read,
the LLC Agreement, and Grantee has been given access to full and complete
information regarding the Issuer and the Company and has utilized such access
to Grantee’s satisfaction for the purpose of obtaining information Grantee
believes to be relevant in making its investment decision and, particularly,
Grantee has either attended or been given reasonable opportunity to attend a
meeting with representatives of the Company for the purpose of asking questions
of, and receiving answers from, such representatives concerning 

 

2

 

the Company and to obtain
any additional information, to the extent reasonably available, Grantee
believes to be relevant in making its investment decision;

 

(g)      Grantee recognizes that an
investment in the Incentive Units involves a high degree of risk, including,
but not limited to, the risk of economic losses from operations of the Company.

 

(h)      Grantee realizes that (i) the
acquisition of the Incentive Units is a long-term investment; (ii) the
purchaser of the Incentive Units must bear the economic risk of investment for
an indefinite period of time because the Incentive Units have not been
registered under the Incentive Units Act of 1933, as amended (the “Securities
Act”), or under the Securities laws of any state and, therefore, none of
such Incentive Units can be sold unless they are subsequently registered under
said laws or exemptions from such registrations are available, and there can be
no assurance that any such registration will be effected at any time in the
future; (iii) Grantee may not be able to liquidate Grantee’s investment in
the event of an emergency or pledge any of such Incentive Units as collateral
for loans; and the transferability of the Incentive Units is restricted in
accordance with the LLC Agreement.

 

(i)        Grantee is a bona fide
resident of, is domiciled in and received the offer and made the decision to
invest in the Incentive Units in the state set forth on the signature page below
under “Address,” and the Incentive Units are being accepted by Grantee in
Grantee’s name solely for Grantee’s own beneficial interest and not as nominee
for, or on behalf of, or for the beneficial interest of, or with the intention
to transfer to, any other person, trust or organization.

 

(j)        Grantee has not retained any
finder, broker, agent, financial advisor, Purchaser Representative (as defined
in Rule 501(h) of Regulation D of the Securities Act) or other
intermediary in connection with the transactions contemplated by this Agreement
and agrees to indemnify and hold harmless the Company from any liability for
any compensation to any such intermediary retained by Grantee and the fees and
expenses of defending against such liability or alleged liability.

 

(k)       Grantee has completed Schedule
A to this Agreement as to his/her status as an “Accredited Grantee”
(as defined therein) and such information is true and complete.

 

(l)        The Grantee agrees promptly
to notify the Company should the Grantee become aware of any change in the information
set forth in this Section 5.

 

7.                                 Conditions to Obligations of the Company.  The obligations of the Company to grant the Incentive Units are subject to the satisfaction of the following conditions: (i) the
representations and warranties of the Grantee contained in Section 5 of
this Agreement shall be true and correct on and as of the Closing Date in all
respects; (ii) and the Grantee shall have entered into the LLC Agreement
prior to or concurrently with the Closing.

 

8.                                 Authority of
the Board of Managers.  All
decisions, interpretations and other actions of the Board of Managers and/or
any committee designated by the Board of Managers, shall be final and binding
on the Grantee and other persons deriving their rights from the Grantee.  Without
limiting the generality of the foregoing, the Board of Managers and/or
any committee designated by the Board of Managers may, in its sole discretion, clarify, construe or 

 

3

 

resolve any ambiguity in any provision of this
Agreement, accelerate vesting, or waive any terms or conditions applicable to
any Incentive Units.

 

9.                                 Counterparts.  This Agreement may be executed in one or more
counterparts, each of which shall be considered an original, but all of which
taken together shall constitute one and the same Agreement.

 

10.                           Employment
Rights.  Neither this Agreement nor any
of its provisions is intended to confer or should be construed as conferring
any rights on the Grantee to continued employment with the Company or any
rights of employment for a fixed term. 
No contract of employment, express or implied, is created hereby and
nothing contained herein shall be construed as creating a joint venture,
partnership, agency or other enterprise between the parties.

 

11.                           No Waiver;
Modifications in Writing.  This
Agreement, together with the LLC Agreement and the other agreements referred to
herein and therein and any exhibits, schedules or other documents referred to
herein or therein, sets forth the entire understanding of the parties, and
supersedes all prior agreements, arrangements, term sheets, presentations and
communications, whether oral or written, with respect to the specific subject
matter hereof.  No waiver of or consent
to any departure from any provision of this Agreement shall be effective unless
signed in writing by the party entitled to the benefit thereof; provided,
however, that the Company may amend, modify or terminate the Incentive Units
accordance with the terms in the LLC Agreement.

 

12.                           Indemnification.  The Grantee will, to the fullest extent
permitted by applicable law, indemnify the Company and each member, manager,
officer and employee (each an “Indemnitee”) against any losses, claims,
damages or liabilities to which any of them may become subject in any capacity
in any action, proceeding or investigation arising out of or based upon any
false representation or warranty, or breach or failure by the Grantee to comply
with any covenant or agreement made by the Grantee herein.  The Grantee will reimburse each Indemnitee
for reasonable legal and other expenses (including the cost of any
investigation and preparation) as they are incurred in connection with any such
action, proceeding or investigation (whether incurred between any Indemnitee
and the Grantee, or between any Indemnitee and any third party).  The reimbursement and indemnity obligations
of the Grantee under this Section 9 will survive the Closing Date and will
be in addition to any liability which the Grantee may otherwise have
(including, without limitation, liabilities under the LLC Agreement), and will
be binding upon and inure to the benefit of any successors, assigns, heirs,
estates, executors, administrators and personal representatives of any
Indemnitee.

 

13.                           Binding Effect;
Assignment.  The rights
and obligations of each party under this Agreement may not be assigned to any
other person or entity.  Except as
expressly provided in this Agreement, this Agreement shall not be construed so
as to confer any right or benefit upon any person or entity other than the
parties to this Agreement, and their respective successors and assigns.  This Agreement shall be binding upon the
Company, the Grantee and their respective heirs, successors, legal
representatives and permitted assigns.

 

14.                           Severability of
Provisions.  Any
provision of this Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability without invalidating the remaining
provisions hereof or affecting the validity or enforceability of such provision
in any other jurisdiction.

 

4

 

15.                           Conflict with
Other Agreements.  For so long
as the LLC Agreement is in full force and effect, this plan shall be subject to
the provisions of the LLC Agreement.  To
the extent any of the provisions of this Agreement conflict or are inconsistent
with any of the provisions of the LLC Agreement, the LLC Agreement shall control.

 

16.                           Schedules and
Descriptive Headings.  All
Schedules to this Agreement shall be deemed to be a part of this
Agreement.  The descriptive headings of
this Agreement are inserted for convenience only and do not constitute a part
of this Agreement.

 

17.                           Governing Law.  This Agreement, and all disputes, claims or
causes of action that arise from or are in connection with this Agreement,
shall be governed by and construed in accordance with the domestic substantive
laws of the State of New York without giving effect to any choice or conflict
of law provision or rule that would cause the application of the domestic
substantive laws of any other jurisdiction.

 

[The remainder of this page has been
intentionally left blank.]

 

5

 

IN WITNESS WHEREOF, the
Grantee has executed this Agreement as of the date first written above.

 

 

	
   

  	
  [                                          ]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

 

ACCEPTED AND AGREED,

as of the date first written above:

 

 

STR
HOLDINGS LLC

 

 

	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

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