Document:

exv10w2

 

EXHIBIT 10.2

METHODE ELECTRONICS, INC.

RESTRICTED STOCK AWARD AGREEMENT

(EXECUTIVE AWARD / PERFORMANCE-BASED)

     This agreement (the “Award Agreement”) dated as of ___(the “Award Date”), is entered
into by and between Methode Electronics, Inc., a Delaware corporation (the “Company”) and
___(the “Grantee”). All capitalized terms used and not otherwise defined herein shall
have the meanings ascribed to them by the Methode Electronics, Inc. 2004 Stock Plan (the “Plan”).

     1.      General. The shares of Restricted Stock granted under this Award Agreement are
granted as of the Award Date pursuant to and subject to all of the provisions of the Plan
applicable to Restricted Stock granted pursuant to Section 8 of the Plan, which provisions are,
unless otherwise provided herein, incorporated by reference and made a part hereof to the same
extent as if set forth in their entirety herein, and to such other terms necessary or appropriate
to the grant hereof having been made. A copy of the Plan is on file in the offices of the Company.

     2.      Grant. The Company hereby grants to Grantee a total of ___shares of
Restricted Stock (the “Restricted Shares”), subject to the restrictions set forth in Section 3
hereof and the Plan.

     3.      Restrictions.

	 	(a)	 	None of the Restricted Shares may be sold, transferred, pledged, hypothecated
or otherwise encumbered or disposed of until they have vested in accordance with
Section 6 of this Award Agreement.
	 
	 	(b)	 	Any Restricted Shares that are not vested shall be forfeited to the Company
immediately upon termination of the Grantee’s employment with the Company and all of
its Subsidiaries and Affiliates.
	 
	 	(c)	 	Any Restricted Shares that are not vested may be forfeited to the Company in
accordance with Section 7 of this Award Agreement.

     4.      Stock Certificates. Each stock certificate evidencing any Restricted Shares shall
contain such legends and stock transfer instructions or limitations as may be determined or
authorized by the Committee in its sole discretion; and the Company may, in its sole discretion,
retain custody of any such certificate throughout the period during which any restrictions are in
effect and require that the Grantee tender to the Company a stock power duly executed in blank
relating thereto as a condition to issuing any such certificate.

 

 

     5.      Rights as Stockholder. The Grantee shall have no rights as a stockholder with
respect to any Restricted Shares until a stock certificate for the shares is issued in Grantee’s
name. Once any such stock certificate is issued in Grantee’s name, the Grantee shall be entitled
to all rights associated with ownership of the Restricted Shares, except that the Restricted Shares
will remain subject to the restrictions set forth in Section 3 hereof and if any additional shares
of Common Stock become issuable on the basis of such Restricted Shares (e.g., a stock dividend),
any such additional shares shall be subject to the same restrictions as the shares of Restricted
Shares to which they relate.

     6.      Vesting.

	 	(a)	 	Vesting Date. The determination as to the number of Restricted Shares
which shall vest pursuant to Section 6(b) shall be made as of May 2, 2009 (the “Vesting
Date”), provided Grantee is employed by the Company (or a Subsidiary or Affiliate
thereof) continuously between the Award Date and the Vesting Date.
	 
	 	(b)	 	Amount of Restricted Shares that Vest. Exhibit A sets forth a table of
percentages which vary based upon certain performance criteria of the Company between
the Award Date and the Vesting Date. Grantee shall vest in the percentage of
Restricted Shares granted to Grantee on the Award Date that corresponds to the
performance of the Company on the Vesting Date. The percentage used to determine the
amount of Grantee’s Restricted Shares that vest shall be determined in the absolute
discretion of the Committee. As set forth in Section 7(a), the percentage of
Restricted Shares not vested on the Vesting Date shall be forfeited.
	 
	 	(c)	 	Termination of Employment Prior to the Vesting Date. Notwithstanding
the provisions of 6(a) and 6(b) herein, Restricted Shares granted hereunder shall vest,
in an amount determined according to the calculation set forth below, if the Grantee’s
employment with the Company and all of its Subsidiaries and Affiliates is terminated
prior to the Vesting Date, due to: (i) retirement on or after Grantee’s sixty-fifth
birthday; (ii) retirement on or after Grantee’s fifty-fifth birthday with consent of
the Company; (iii) retirement at any age on account of total and permanent disability
as determined by the Company; (iv) death; or (v) a Change of Control as defined in the
Plan. For purposes of this Section 6(c), “Early Termination Date” shall refer to the
occurrence of one of the events set forth in (i), (ii), (iii) and (iv), and “Change of
Control Date” shall refer to the occurrence of the event set forth in (v). For
clarity, Exhibit B attached hereto and incorporated herein sets forth an example in
which the Restricted Shares vest upon the Change of Control Date as described in
Section 6(c)(v). If Grantee’s employment terminates on the Early Termination Date or
there is a Change of Control, then Grantee’s Restricted Shares shall vest as of the
Early Termination Date or Change of Control Date, as follows: Grantee shall vest in
the percentage of Restricted Shares that, extrapolated from the performance growth of
the Company from the Award Date to the most recent prior fiscal quarter to the Early
Termination Date or the Change of Control Date, would have vested on the

 

 

	 	 	 	Vesting Date, multiplied by the percentage set forth in Exhibit C (column (d))
corresponding to the number of months elapsed since April 30, 2006 (rounded up).
	 
	 	(d)	 	Change of Control. In the event of a Change of Control, Section 6(c)
of this Award Agreement shall govern vesting hereunder, and Section 11.3 of the Plan
shall be inapplicable.

     7.      Forfeiture.

	 	(a)	 	Forfeiture of Restricted Shares not Vested. As of the Vesting Date,
Grantee shall forfeit all Restricted Shares not vested pursuant to Section 6(b) or
Section 6(c) hereof. By example, pursuant to Section 6(b), if Grantee vests in 65% of
the Restricted Shares granted to Grantee on the Award Date, Grantee thereby forfeits
35% of the Restricted Shares granted to Grantee on the Award Date.
	 
	 	(b)	 	Forfeiture if the Grantee Engages in Certain Activities. If at any
time the Grantee engages in any activity adverse, contrary or harmful to the interests
of the Company, including, but not limited to: (i) conduct related to the Grantee’s
employment for which either criminal or civil penalties against the Grantee may be
sought, (ii) while employed by the Company or any Subsidiary or Affiliate, serving as a
consultant, advisor or in any other capacity to an entity that is, or proposes to be,
in competition with or acting against the interests of the Company, (iii) employing or
recruiting any present, former or future employee of the Company, whether individually
or on behalf of another person or entity, that is, or proposes to be, in competition
with or acting against the interests of the Company, (iv) disclosing or misusing any
confidential information or material concerning the Company, or (v) participating in a
hostile takeover attempt, then (1) the unvested Restricted Shares shall be forfeited to
the Company effective as of the date on which the Grantee entered into such activity,
unless terminated sooner by operation of another term or condition of this Award
Agreement or the Plan, or (2) if elected by the Company, the Grantee shall immediately
pay to the Company the Fair Market Value of the unvested Restricted Shares.
	 
	 	(c)	 	Right of Set-off. If the Grantee owes the Company any amount by virtue
of Section 7(b) above, then the Company (or any Subsidiary or Affiliate) may recover
such amount by setting it off from any amounts the Company (or any Subsidiary or
Affiliate) owes or may owe the Grantee from time to time. By accepting these
Restricted Shares and signing this Award Agreement in the space provided below, the
Grantee consents to a deduction of any amount the Grantee may owe the Company by virtue
of Section 7(b) above from any amounts the Company (or any Subsidiary or Affiliate)
owes or may owe the Grantee from time to time (including amounts owed to the Grantee as
wages or other compensation, fringe benefits, or vacation pay, as well as any other
amounts owed to the Grantee). Whether or not the Company elects to make any set off in
whole or in

 

 

	 	 	 	part, if the Company does not recover by means of set off the full amount the
Grantee owes it, calculated as set forth above, the Grantee agrees to pay
immediately the unpaid balance to the Company.
	 
	 	(d)	 	Committee Discretion. The Committee may release the Grantee from the
obligations under Section 7(b) above if the Committee determines in its sole discretion
that such action is in the best interest of the Company.

     8.      Other Terms and Conditions. The Committee shall have the discretion to determine
such other terms and provisions hereof as stated in the Plan.

     9.      Applicable Law. The validity, construction, interpretation and enforceability of
this Award Agreement shall be determined and governed by the laws of the State of Illinois without
regard to any conflicts or choice of law rules or principles that might otherwise refer
construction or interpretation of this Award Agreement to the substantive law of another
jurisdiction, and any litigation arising out of this Award Agreement shall be brought in the
Circuit Court of the State of Illinois or the United States District Court of the Eastern Division
of the Northern District of Illinois and the Grantee consents to the jurisdiction and venue of
those courts.

     10.      Severability. The provisions of this Award Agreement are severable and if any one
or more provisions may be determined to be illegal or otherwise unenforceable, in whole or in part,
the remaining provisions, and any partially unenforceable provision to the extent enforceable in
any jurisdiction, shall nevertheless be binding and enforceable.

     11.      Waiver. The waiver by the Company of a breach of any provision of this Award
Agreement by Grantee shall not operate or be construed as a waiver of any subsequent breach by
Grantee.

     12.      Binding Effect. The provisions of this Award Agreement shall be binding upon the
parties hereto, their successors and assigns, including, without limitation, the Company, its
successors or assigns, the estate of the Grantee and the executors, administrators or trustees of
such estate and any receiver, trustee in bankruptcy or representative of the creditors of the
Grantee.

     13.      Withholding. Grantee agrees, as a condition of this grant, to make acceptable
arrangements to pay any withholding or other taxes that may be due as a result of the vesting of
the Restricted Shares acquired under this grant. In the event that the Company determines that any
federal, state, local or foreign tax or withholding payment is required relating to the vesting of
shares arising from this grant, the Company shall have the right to require such payments from
Grantee, or withhold such amounts from other payments due Grantee from the Company or any
Subsidiary or Affiliate.

     14.      No Retention Rights. Nothing herein contained shall confer on the Grantee any
right with respect to continuation of employment by the Company or its Subsidiaries or

 

 

Affiliates, or interfere with the right of the Company or its Subsidiaries or Affiliates to
terminate at any time the employment of the Grantee.

     15.      Construction. This Award Agreement is subject to and shall be construed in
accordance with the Plan, the terms of which are explicitly made applicable hereto. In the event
of any conflict between the provisions hereof and those of the Plan, the provisions of the Plan
shall govern.

	 	 	 	 	 
	GRANTEE	 	METHODE ELECTRONICS, INC.
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Douglas A. Koman
	 

	 	Its:
	 	Vice President, Corporate Finance and Chief Financial Officerexv10w3

 

EXHIBIT 10.3

METHODE ELECTRONICS, INC.

CASH AWARD AGREEMENT

     This agreement (the “Cash Award Agreement”) dated as of ___(the “Effective Date”), is
entered into by and between Methode Electronics, Inc., a Delaware corporation (the “Company”) and
___(the “Grantee”).

     1.      General. The purpose of the Cash Award Agreement is to retain and reward selected
officers and to provide incentive for remaining with and enhancing the performance of the Company
over the long term.

     2.      Definitions.

     (a)     “Affiliate” means any entity during any period that, in the opinion of the Committee, the
Company has a significant economic interest in the entity.

     (b)     “Board” or “Board of Directors” means the board of directors of the Company.

     (c)     “Cause” shall mean any willful misconduct by the Grantee which affects the business
reputation of the Company or willful failure by the Grantee to perform his or her material
responsibilities to the Company (including, without limitation, breach by the Grantee of any
provision of any employment, consulting, advisory, nondisclosure, non-competition or other similar
agreement between the Grantee and the Company or any Affiliate or Subsidiary). The Grantee shall
be considered to have been discharged for “Cause” if the Company determines, within 30 days after
the Grantee’s resignation, that discharge for Cause was warranted.

     (d)     “Change of Control” shall be deemed to have occurred on the first to occur of any of the
following:

     (i)     any “person” (as such term is used in Section 13(d) and 14(d)(2) of the Exchange
Act, other than any Subsidiary or any employee benefit plan of the Company or a Subsidiary,
is or becomes a beneficial owner, directly or indirectly, of stock of the Company
representing 25% or more of the total voting power of the Company’s then outstanding stock;

     (ii)     a tender offer (for which a filing has been made with the SEC which purports to
comply with the requirements of Section 14(d) of the Exchange Act and the corresponding SEC
rules) is made for the stock of the Company. In case of a tender offer described in this
paragraph (ii), the “Change of Control” will be deemed to have occurred upon the first to
occur of (A) any time during the offer when the person (using the definition in (i) above)
making the offer owns or has accepted for payment stock of the Company with 25% or more of
the total voting power of the Company’s outstanding stock or (B) three business days before
the offer is to terminate unless the offer is

 

 

withdrawn first, if the person making the offer could own, by the terms of the offer plus
any shares owned by this person, stock with 50% or more of the total voting power of the
Company’s outstanding stock when the offer terminates; or

     (iii)     individuals who were the Board’s nominees for election as directors of the
Company immediately prior to a meeting of the shareholders of the Company involving a
contest for the election of directors shall not constitute a majority of the Board following
the election.

     (e)      “Committee” means the Compensation Committee of the Board of Directors.

     (f)      “Common Stock” means the Common Stock of the Company.

     (g)      “Company” means Methode Electronics, Inc., a Delaware corporation, and any successor
thereto.

     (h)      “Exchange Act” shall mean the Securities Exchange Act of 1934, as it exists now or from
time to time may hereafter be amended.

     (i)     “Good Reason” shall mean any of the following:

     (i)     any significant diminution in the Grantee’s title, authority, or responsibilities
from and after a Change of Control;

     (ii)     any reduction in the base compensation payable to the Grantee from and after a
Change of Control; or

     (iii)     the relocation after a Change of Control of the Company’s place of business at
which the Grantee is principally located to a location that is greater than 50 miles from
the site immediately prior to the Change of Control.

     (j)      “SEC” means the Securities and Exchange Commission.

     (k)      “Subsidiary” means any entity during any period which the Company owns or controls more
than 50% of (i) the outstanding capital stock, or (ii) the combined voting power of all classes of
stock.

     3.      Cash Award.

     (a)     As of May 2, 2009 (the “Vesting Date”), Company shall pay to Grantee a cash award (“Cash
Award”), which Cash Award shall be based upon a percentage (“Percentage”), which varies according
to the performance criteria set forth on Exhibit A, which Percentage shall be determined in the
sole and absolute discretion of the Committee as of the date of grant. The Cash Award shall be
calculated according to the following formula:

 

 

	 	 	 	 	 
	Cash Award

	 	=
	 	(Percentage) x (___) x (May 2, 2009 Closing Price
of Common Stock of the Company)

Provided, however, that Grantee remains in the employ of Company, or one of its Subsidiaries and
Affiliates between the Effective Date and May 2, 2009.

The Cash Award shall be paid on or before July 31, 2009, less state and federal tax and other
legally required withholdings per year, payable in accordance with the Company’s usual payroll
procedures.

     (b)     Notwithstanding the foregoing, the Cash Award, if any, shall be paid to Grantee in an
amount determined according to the calculations set forth below, if the Grantee’s employment with
the Company and all of its Subsidiaries and Affiliates is terminated prior to the Vesting Date due
to: (i) retirement on or after Grantee’s sixty-fifth birthday; (ii) retirement on or after
Grantee’s fifty-fifth birthday with consent of the Company; (iii) retirement at any age on account
of total and permanent disability as determined by the Company; (iv) death; or (v) a Change of
Control. For purposes of this Section 2(c), “Early Termination Date” shall refer to the occurrence
of one of the events set forth in (i), (ii), (iii) and (iv), and “Change of Control Date” shall
refer to the occurrence of the event set forth in (v). For clarity, Exhibit B attached hereto and
incorporated herein sets forth an example in which the Cash Award is paid to Grantee upon the
Change of Control Date as described in Section3(b)(v). If Grantee’s employment terminates on the
Early Termination Date or there is a Change of Control, then Grantee’s Cash Award, if any, shall be
calculated, pursuant to the method set forth in Section 2(a), as of the Early Termination Date or
Change of Control Date, as modified by the following: The percentage shall be calculated
extrapolating from the performance growth of the Company from the Award Date to the most recent
fiscal quarter ending prior to the Early Termination Date or the Change of Control Date; then the
product of the formula under Section 3(a) (as modified herein) shall be multiplied by the
percentage set forth in Exhibit C (column(d)) corresponding to the number of months elapsed since
May 1, 2006 (rounded up) (the “Fraction”). The Cash Award shall therefore be calculated as
follows:

	 	 	 	 	 
	Cash Award

	 	=
	 	(Extrapolated Percentage) x (___) x
(Closing Price of Common Stock of the Company as of Early Termination Date or Change of
Control Date) x (Fraction)

In the event that a Cash Award is paid pursuant to this Section 3(b), for purposes of determining
the Cash Award pursuant to Section 3(a), the Closing Price of Common Stock of the Company shall be
determined as of the Early Termination Date or the Change of Control Date. The percentage and
calculations set forth in this Section 3(b) shall be determined in the sole discretion of the
Committee.

     4.      Forfeiture if the Grantee Engages in Certain Activities. If at any time the
Grantee engages in any activity adverse, contrary or harmful to the interests of the Company,
including, but not limited to: (i) conduct related to the Grantee’s employment for which either
criminal or civil penalties against the Grantee may be sought, (ii) while employed by the Company
or any

 

 

Subsidiary or Affiliate, serving as a consultant, advisor or in any other capacity to an entity
that is, or proposes to be, in competition with or acting against the interests of the Company,
(iii) employing or recruiting any present, former or future employee of the Company, whether
individually or on behalf of another person or entity, that is, or proposes to be, in competition
with or acting against the interests of the Company, (i) disclosing or misusing any confidential
information or material concerning the Company, or (v) participating in a hostile takeover attempt,
then Grantee shall forfeit the Cash Award.

     5.      Other Terms and Conditions. The Committee shall have the discretion to determine
such other terms and provisions hereof.

     6.      Adjustments to Reflect Changes in Capital Structure; Cashouts. In the event of an
extraordinary dividend or other distribution, merger, reorganization, consolidation, combination,
sale of assets, split up, exchange, or spin off, or other extraordinary corporate transaction, the
Committee may, in such manner and to such extent (if any) as it deems appropriate and equitable,
make provision for a cash payment or for the substitution of the Cash Award based upon the
distribution or consideration payable to holders of Common Stock upon or in respect of such event.

     7.      Applicable Law. The validity, construction, interpretation and enforceability of
this Cash Award Agreement shall be determined and governed by the laws of the State of Illinois
without regard to any conflicts or choice of law rules or principles that might otherwise refer
construction or interpretation of this Cash Award Agreement to the substantive law of another
jurisdiction, and any litigation arising out of this Cash Award Agreement shall be brought in the
Circuit Court of the State of Illinois or the United States District Court of the Eastern Division
of the Northern District of Illinois and the Grantee consents to the jurisdiction and venue of
those courts.

     8.      Severability. The provisions of this Cash Award Agreement are severable and if any
one or more provisions may be determined to be illegal or otherwise unenforceable, in whole or in
part, the remaining provisions, and any partially unenforceable provision to the extent enforceable
in any jurisdiction, shall nevertheless be binding and enforceable.

     9.      Waiver. The waiver by the Company of a breach of any provision of this Cash Award
Agreement by Grantee shall not operate or be construed as a waiver of any subsequent breach by
Grantee.

     10.      Binding Effect. The provisions of this Cash Award Agreement shall be binding upon
the parties hereto, their successors and assigns, including, without limitation, the Company, its
successors or assigns, the estate of the Grantee and the executors, administrators or trustees of
such estate and any receiver, trustee in bankruptcy or representative of the creditors of the
Grantee.

     11.      No Retention Rights. Nothing herein contained shall confer on the Grantee any
right with respect to continuation of employment by the Company or its Subsidiaries or

 

 

Affiliates, or interfere with the right of the Company or its Subsidiaries or Affiliates to
terminate at any time the employment of the Grantee.

	 	 	 	 	 
	GRANTEE	 	METHODE ELECTRONICS, INC.
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Douglas A. Koman
	 

	 	Its:
	 	Vice President, Corporate Finance and Chief Financial Officer

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