Form of Cash-Based Unit Award Agreement pursuant to the 2022 Equity and Incentive Compensation Plan
Exhibit 10.3
EMPLOYEE CASH-BASED UNIT AWARD AGREEMENT
2022 EQUITY AND INCENTIVE COMPENSATION PLAN
Gray Media, Inc. (the “Company”) hereby grants to Participant (the “Award”) the target number of cash-based performance units and the right to earn additional cash-based performance units (collectively, the “Cash-Based Performance Units” or “CPUs”) in the amounts and on the vesting date indicated below or otherwise provided herein, subject to (i) the Participant’s continuous employment with the Company and/or its Subsidiaries through the applicable vesting date (such date, the “Vesting Date” and such period, the “Vesting Period”) and (ii) the Company’s Compensation Committee of the Board (the “Committee”) determining, in its discretion, that the performance criteria set forth on Attachment A hereto have been satisfied and the resulting applicable amount of the CPUs earned thereunder (the “Performance Criteria”). Participant shall be entitled to receive $1 in cash for each CPU which becomes earned and vested. The Award is subject to the terms and conditions set forth on this page and in Attachments A and B hereto (collectively, this “Agreement”), as well as those in the Company’s 2022 Equity and Incentive Compensation Plan (the “Plan”), which is incorporated herein.
| Participant: | [ ] |
| Date of Grant: | [ ] |
| Vesting Date: | [ ] |
| Target Number of CPUs: | [ ] |
The CPUs on the Date of Grant shall be stated as a target number of CPUs. The actual number of CPUs earned shall be determined based on the achievement of the Performance Criteria.
The Participant acknowledges that he or she (a) has received a copy of the Plan and the prospectus for the Plan, (b) has had an opportunity to review the terms of this Agreement, the Plan, and the prospectus for the Plan, and (c) understands and agrees to the terms and conditions of this Agreement and the Plan.
As of the Date of Grant, this Agreement and the Plan set forth the entire understanding between Participant and the Company regarding the Award and supersede all prior oral and written agreements on the terms of the Award. Capitalized terms not explicitly defined herein are defined in the Plan. In the event of any conflict between the terms of the Award and the Plan, the terms of the Plan will control.
| GRAY MEDIA, INC. | PARTICIPANT: | ||||
| By: | By: | ||||
| [ ] | [ ] | ||||
| [ ] | [ ] | ||||
| [ , ] | [ , ] | ||||
GRAY MEDIA, INC.
EMPLOYEE CASH-BASED PERFORMANCE UNIT AWARD AGREEMENT
2022 EQUITY AND INCENTIVE COMPENSATION PLAN
ATTACHMENT A
Performance Criteria:
The CPUs evidenced by this Award shall vest, and the final number of CPUs earned as of the Vesting Date shall be calculated, upon the Committee’s determining the number of CPUs actually earned, as a percentage of the target number of CPUs specified in the table above, ranging from 0% to 200% of the target, by averaging the percentage of target payout achieved by the Participant under the Plan for each year of the Vesting Period. Subject to Attachment B, all such earned CPUs shall fully vest as of the Vesting Date.
GRAY MEDIA, INC.
CASH-BASED PERFORMANCE UNIT AWARD AGREEMENT
2022 EQUITY AND INCENTIVE COMPENSATION PLAN
ATTACHMENT B
| 1. | Grant of CPUs. Each CPU represents the right to receive a cash amount equal to $1 for each CPU which becomes earned and vested. |
| 2. | Vesting of CPUs. |
| (a) | The CPUs covered by this Agreement shall become nonforfeitable (“Vest” or similar terms) as provided on the first page of this Agreement. Any CPU that does not so Vest will be forfeited, including, except as provided in Section 2(b) below, if the Participant ceases to be continuously employed by the Company or a Subsidiary prior to the end of the Vesting Period. For purposes of this Agreement, “continuously employed” (or substantially similar terms) means the absence of any termination of the Participant’s employment with the Company and/or a Subsidiary. |
| (b) | Notwithstanding Section 2(a) above, the target number of CPUs to the extent they have not previously Vested or been forfeited shall Vest (i) upon the Participant’s death or Disability prior to the end of the Vesting Period; provided, that the Participant was continuously employed by the Company or any of its Subsidiaries through the date of death or Disability; or (ii) upon a termination of the Participant’s employment with the Company or a Subsidiary (or any of their successors) (as applicable, the “Successor”) by reason of a termination of the Participant’s employment by the Successor without Cause (and not due to death or Disability) or by the Participant for Good Reason, in either case within a period of 12 months after a Change in Control; provided, that such termination of the Participant’s employment occurs prior to the end of the Vesting Period. |
| (c) | For purposes of this Agreement: |
| (i) | “Cause” shall mean any of the following: (A) a material breach by the Participant of any agreement then in effect between the Participant and the Successor; (B) the Participant’s conviction of or plea of “guilty” or “no contest” to a felony under the laws of the United States or any state thereof; (C) any material violation or breach by the Participant of the Company’s Code of Ethics as in effect immediately prior to the Change in Control, as determined by the Board (or the board of directors of the Successor); or (D) the Participant’s willful and continued failure to substantially perform the duties associated with the Participant’s position (other than any such failure resulting from the Participant’s incapacity due to physical or mental illness), which failure has not been cured within 30 days after a written demand for substantial performance is delivered to the Participant by the Board (or the board of directors of the Successor), which demand specifically identifies the manner in which the Board (or the board of directors of the Successor) believes that the Participant has not substantially performed his duties. |
| (ii) | “Disability,” or similar terms, shall mean (A) the Participant is unable to engage in any substantial gainful activity due to medically determinable physical or mental impairment expected to result in death or to last for a continuous period of not less than 12 months, or (B) due to any medically determinable physical or mental impairment expected to result in death or last for a continuous period of not less than 12 months, the Participant has received income replacement benefits for a period of not less than three months under an accident and health plan sponsored by the Company. |
| (iii) | “Good Reason” shall mean (A) a material and permanent diminution in the Participant’s authority, duties or responsibilities; (B) a material diminution in the aggregate base salary or annual incentive opportunity provided to the Participant by the Successor; or (C) a permanent reassignment of the Participant to another primary office more than 50 miles from the Participant’s current office location. The Participant must (x) notify the Successor of the Participant’s intention to invoke the right to terminate for Good Reason within 60 days after the Participant has knowledge of such event, (y) provide the Successor with a 30-day cure period, and (z) actually terminate employment for Good Reason within 60 days following the end of the Successor’s 30-day cure period, or such event shall not constitute Good Reason. The Participant may not invoke termination for Good Reason if Cause exists at the time the Participant invokes such right to terminate employment for Good Reason, or at any time between such date and the date the Participant actually terminates employment for Good Reason pursuant to the preceding sentence. |
3. Payment of CPUs. With respect to any CPUs that become vested, payment of the cash amount as determined in Section 1 above shall be made as soon as practical following the date of Vesting and in all cases within the “short-term deferral period” determined under Treasury Regulation Section 1.409A-1(b)(4). The Participant shall have no rights to interest or earnings with respect to any CPUs covered by this Agreement.
4. Transferability. Subject to Section 15 of the Plan, the CPUs shall not be transferable other by will or pursuant to the laws of descent and distribution. Any purported transfer or encumbrance in violation of this Section shall be void, and the other party to any such purported transaction shall not obtain any rights to or in interest in such CPUs.
5. Adjustments. The number of CPUs subject to this Agreement and the other terms and conditions of the grant evidenced by this Agreement are subject to adjustment as provided in Section 11 of the Plan.
6. Withholding Taxes. To the extent that the Company is required to withhold federal, state, local or foreign taxes in connection with the issuance or Vesting of the CPUs, any payment to the Participant pursuant to Section 3 or any other payment or vesting event under this Agreement, and the amounts available to the Company for such withholding are insufficient, the Participant shall pay such taxes or make arrangements satisfactory to the Company for payment of such taxes.
7. Compliance With Law. The Company shall make reasonable efforts to comply with all applicable federal and state securities laws.
8. No Right to Future Awards or Employment. The grant of the CPUs under this Agreement to the Participant is a voluntary, discretionary award being made on a one-time basis and it does not constitute a commitment to make any future awards. Nothing contained in this Agreement shall confer upon the Participant any right to be employed or remain employed by the Company or any of its Subsidiaries, nor limit or affect in any manner the right of the Company or any of its Subsidiaries to terminate the employment or adjust the compensation of the Participant.
9. Relation to Other Benefits. The grant of the CPUs and any payments made hereunder will not be considered salary or other compensation for purposes of any severance pay or similar allowance, except as otherwise required by law. Any economic or other benefit to the Participant under this Agreement or the Plan shall not be taken into account in determining any benefits to which the Participant may be entitled under any profit-sharing, retirement or other benefit or compensation plan maintained by the Company or any of its Subsidiaries and shall not affect the amount of any life insurance coverage available to any beneficiary under any life insurance plan covering employees of the Company or any of its Subsidiaries.
10. Clawback. Notwithstanding anything in this Agreement to the contrary, Participant acknowledges and agrees that this Agreement and the Award are subject to the terms and conditions of the Company’s clawback policy (if any) as may be in effect from time to time specifically to implement Section 10D of the Exchange Act and any applicable rules or regulations promulgated thereunder (including applicable rules and regulations of any national securities exchange on which the shares of Stock may be traded).
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 (a) no amendment shall impair the rights of the Participant under this Agreement without the Participant’s written consent, and (b) the Participant’s consent shall not be required to an amendment that is deemed necessary by the Company to ensure compliance with Section 10D of the Exchange Act.
12. Severability. In the event that one or more of the provisions of this Agreement shall be invalidated for any reason by a court of competent jurisdiction, any provision so invalidated shall be deemed to be separable from the other provisions hereof, and the remaining provisions hereof shall continue to be valid and fully enforceable.
13. Relation to Plan. This Agreement is subject to the terms and conditions of the Plan. In the event of any inconsistency between the provisions of this Agreement and the Plan, the Plan shall govern. The Committee acting pursuant to the Plan, as constituted from time to time, shall, except as expressly provided otherwise herein or in the Plan, have the right to determine any questions that arise in connection with this Agreement.
14. Disclosures. Notwithstanding anything in this Agreement to the contrary, nothing in this Agreement prevents the Participant from providing, without prior notice to the Company, information to governmental authorities regarding possible legal violations or otherwise testifying or participating in any investigation or proceeding by any governmental authorities regarding possible legal violations.
15. Governing Law. This Agreement shall be governed by and construed with the internal substantive laws of the State of Georgia, without giving effect to any principle of law that would result in the application of the law of any other jurisdiction.
16. Successors and Assigns. Without limiting Section 5 hereof, the provisions of this Agreement shall inure to the benefit of, and be binding upon, the successors, administrators, heirs, legal representatives and assigns of the Participant, and the successors and assigns of the Company.
