CINEMARK HOLDINGS, INC. RESTRICTED SHARE AWARD AGREEMENT
Exhibit 4.6
2006 LONG TERM INCENTIVE PLAN
This Restricted Share Award Agreement (this “Agreement”), made as of the ___ day of
___, 2007 (the “Grant Date”) by and between Cinemark Holdings, Inc., a Delaware corporation
(the “Company”), and _________ (the “Grantee”), evidences the grant by the Company of a
Stock Award (the “Award”) of restricted Common Stock, par value $0.001 per share (the “Common
Stock”) to the Grantee on such date and the Grantee’s acceptance of the Award in accordance with
the provisions of the Company’s 2006 Long Term Incentive Plan (the “Plan”), a copy of which is
attached hereto as Exhibit A.
NOW, THEREFORE, in consideration of the premises and the benefits to be derived from the
mutual observance of the covenants and promises contained herein and other good and valuable
consideration, the sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Basis for Award. This Award is made pursuant to the Plan for valid consideration provided
to the Company by the Grantee as a Non-Employee Director of the Company in accordance with the
Company’s Non-Employee Director Compensation Policy (the “Compensation Policy”). By your execution
of this Agreement, you agree to accept the Restricted Share Award rights granted pursuant to this
Restricted Share Award Agreement and to receive the Restricted Shares of Cinemark Holdings, Inc.
(the “Restricted Shares”) designated herein subject to the terms of the Plan and this Award
Agreement.
2. Restricted Share Award. The Company hereby awards to Grantee, at a purchase price of
$0.001 per share, _________ shares of Common Stock of the Company (the “Restricted Share Award”)
which shall be subject to the restrictions and conditions set forth in the Plan and in this
Agreement. In the event that Grantee fails to pay the designated purchase price within seven
business days following the Grant Date, the Restricted Share Award shall expire and be canceled.
One or more stock certificates representing the number of Restricted Shares specified herein shall
hereby be registered in the Participant’s name (the “Stock Certificate”), but shall be deposited
and held in the custody of the Company for the Participant’s account as provided in Section 10(c)
hereof until such Restricted Shares become vested. Participant acknowledges and agrees that
Restricted Shares may be issued as a book entry with the Company’s transfer agent and that no
physical Stock Certificates need be issued for so long as the shares remain unvested shares.
Subject to the terms of this Agreement, Participant shall have all the rights of a stockholder with
respect to the Restricted Shares while they are held in the custody of the Company for Participant
’s account, including the right to vote the Restricted Shares and to receive any dividends thereon.
3. Vesting.
(a) The Restricted Shares shall vest and restrictions on transfer shall lapse on _________
(the “Vesting Date”) if the Grantee continuously serves as a Non-Employee Director of the Company
through the Vesting Date.
(b) Any unvested shares of Common Stock shall become vested if, during the term of Grantee’s
service as a director of the Company, the Company consummates a merger, consolidation, sale of all
or substantially all of the assets of the Company, sale of the outstanding capital stock of the
Company or similar transaction (a “Liquidity Event”) approved by the Board of Directors and
stockholders of the Company pursuant to which all of the stockholders of the Company receive cash,
stock or other property in exchange for their stock in the Company; provided, however, that a
transaction shall not constitute a Liquidity Event if its sole purpose is to change the state of
the Company’s incorporation or to create a holding company that will be owned in substantially the
same proportions by the persons who held the Company’s securities immediately before such
transaction.
(c) In the event Grantee’s service as a Non-Employee Director of the Company is terminated by
the Company for any reason, by Grantee for any reason, as a result of a failure to nominate Grantee
for reelection as a Director of the Company, a failure of the Company’s stockholders to reelect
Grantee as a Director of the Company, or as a result of Grantee’s death, disability or retirement,
no unvested shares of Common Stock shall become vested after such termination of Grantee’s service
as a Non-Employee Director of the Company.
4. Compliance with Laws and Regulations. The issuance and transfer of Common Stock shall be
subject to compliance by the Company and Grantee with all applicable requirements of federal and
state securities laws and with all applicable requirements of any stock exchange on which the
Company’s Common Stock may be listed at the time of such issuance or transfer. Grantee understands
that the Company is under no obligation to register or qualify the Common Stock with the SEC, any
state securities commission or any stock exchange to effect such compliance.
5. Tax Considerations.
(a) Grantee acknowledges and agrees that Grantee shall be solely responsible for the payment
of any federal, state or local taxes of any kind required by law to be paid with respect to the
Restricted Shares. The Company shall issue to Grantee a Form 1099 with respect to the Restricted
Shares.
(b) Grantee may elect, within thirty (30) days of the Grant Date, to include in gross income
for federal income tax purposes an amount equal to the Fair Market Value of the Restricted Shares
less the amount, if any, paid by the Grantee for the Restricted Shares granted hereunder pursuant
to Section 83(b) of the Internal Revenue Code of 1986, as amended. Grantee shall be solely
responsible for properly filing any such election with the Internal Revenue Service.
6. No Right to Continued Service. Nothing in the Plan or this Agreement shall confer on
Grantee any right to continue to serve as a director of the Company or any Affiliate, or limit in
any way the right of the Company or any Affiliate to terminate Grantee’s service as a director of
the Company or any Affiliate, with or without Cause.
7. Representations and Warranties of Grantee. Grantee represents and warrants to the Company
that:
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(a) Agrees to Terms of the Plan. Grantee has received a copy of the Plan and has read
and understands the terms of the Plan and this Agreement, and agrees to be bound by their terms and
conditions. Grantee acknowledges that there may be adverse tax consequences upon the vesting of
Restricted Shares or disposition of the shares of Common Stock once vested, and that Grantee should
consult a tax advisor prior to such time.
(b) Purchase for Own Account for Investment. Grantee is receiving the Common Stock
for Grantee’s own account for investment purposes only and not with a view to, or for sale in
connection with, a distribution of the Common Stock within the meaning of the Securities Act.
Grantee has no present intention of selling or otherwise disposing of all or any portion of the
Common Stock and no one other than Grantee has any beneficial ownership of any of the Common Stock.
(c) Access to Information. Grantee has had access to all information regarding the
Company and its present and prospective business, assets, liabilities and financial condition that
Grantee reasonably considers important in making the decision to purchase the Common Stock, and
Grantee has had ample opportunity to ask questions of the Company’s representatives concerning such
matters and this investment.
(d) Understanding of Risks. Grantee is fully aware of: (i) the highly speculative
nature of the investment in the Common Stock; (ii) the financial hazards involved; (iii) the lack
of liquidity of the Common Stock and the restrictions on transferability of the Common Stock
(e.g., that Company has no obligation to register the Common Stock subject to the Restricted Shares
and Grantee may not be able to sell or dispose of the shares of Common Stock or use them as
collateral for loans); (iv) the qualifications and backgrounds of the management of the Company;
and (v) the tax consequences of investment in the Common Stock. Grantee is capable of evaluating
the merits and risks of this investment, has the ability to protect Grantee’s own interests in this
transaction and is financially capable of bearing a total loss of this investment. Grantee
acknowledges that no representations have been made by the Company regarding the current or future
value of the Common Stock or the ability of the Company to achieve any certain level of future
earnings, register the shares, or engage in any type of liquidity transaction resulting in value to
the Company’s stockholders.
(e) No General Solicitation. At no time was Grantee presented with or solicited by
any publicly issued or circulated newspaper, mail, radio, television or other form of general
advertising or solicitation in connection with the offer, sale and purchase of the shares of Common
Stock.
(f) Reliance on Agreement. Grantee represents and warrants that (i) Grantee has
entered into this Agreement in order to induce the Company to grant Restricted Shares to Grantee
pursuant to the Compensation Policy, (ii) Grantee is the record and beneficial owner of the Option
Shares (as defined in Section 10) with full right and power to transfer the Option Shares to the
Company free and clear of any liens, claims or encumbrances, and (iii) Grantee understands that the
stock certificates evidencing the Option Shares will bear a legend referencing this Agreement.
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8. Compliance with U.S. Federal Securities Laws. Grantee understands and acknowledges that
the Common Stock has not been registered with the SEC under the Securities Act and that,
notwithstanding any other provision of the Agreement to the contrary, the vesting and holding of
the Common Stock is expressly conditioned upon compliance with the Securities Act and all
applicable state securities laws. Grantee agrees to cooperate with the Company to ensure
compliance with such laws.
9. Restricted Securities.
(a) Nontransferability Prior to Vesting. Until the Restricted Shares became vested,
the unvested Restricted Shares may not be sold, transferred, assigned, pledged, conveyed,
hypothecated, or otherwise disposed of.
(b) No Transfer Unless Registered or Exempt. Grantee understands that Grantee may not
transfer any vested share of Common Stock unless such Common Stock is registered under the
Securities Act or qualified under applicable state securities laws or unless, in the opinion of
counsel to the Company, exemptions from such registration and qualification requirements are
available. Grantee understands that only the Company may file a registration statement with the
SEC and that the Company is under no obligation to do so with respect to the Common Stock. Grantee
has also been advised that exemptions from registration and qualification may not be available or
may not permit Grantee to transfer all or any of the Common Stock in the amounts or at the times
proposed by Grantee.
(c) SEC Rule 144. In addition, Grantee has been advised that SEC Rule 144 promulgated
under the Securities Act, which permits certain limited sales of unregistered securities requires
that the Common Stock be held for a minimum of one (1) year, and in certain cases two (2) years,
after they have been purchased and paid for (within the meaning of Rule 144). Grantee understands
that Rule 144 may indefinitely restrict transfer of the Common Stock so long as Grantee remains an
“affiliate” of the Company or if “current public information” about the Company (as defined in Rule
144) is not publicly available. Affiliates must comply with the provisions (in addition to the
holding period requirements) of Rule 144.
10. Option to Repurchase Unvested Stock. Grantee grants to the Company an irrevocable right
and option (the “Option”) to purchase from Grantee shares of unvested Common Stock standing in the
name of Grantee on the books of the Company (the “Option Shares”) in accordance with this
Agreement.
(a) Option Exercise Price. The exercise price for the Option Shares (the “Option
Exercise Price”) shall be $0.001 per share.
(b) Repurchase of Option Shares. Option Shares may be repurchased by the Company at a
price of $0.001 per share and shall be transferred to the Company automatically without further
action by Grantee if repurchased by the Company. The Company may exercise the right to repurchase
the Option Shares at any time within one hundred twenty (120) days after termination for any reason
of Grantee’s service as a Non-Employee Director of the Company. The repurchase price may be paid
to Grantee by personal delivery or by Company check mailed to Grantee’s last known address on the
Company’s records. Grantee acknowledges the Option
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Shares shall be held by Grantee subject to the applicable vesting requirements set forth in
this Agreement and Grantee shall have no right to retain any Option Shares that the Company
repurchases in accordance with the terms of this Agreement. The Company may elect to assign its
right to repurchase the Option Shares to any designee of the Company.
(c) Deposit of the Option Shares. Grantee shall deposit all of the Option Shares with
the Company to hold until the Option Shares become vested, at which time such vested shares shall
no longer constitute Option Shares. The Company will deliver to Grantee the shares of Common Stock
that become vested upon vesting of such shares. Grantee shall execute and deliver to the Company,
concurrently with the execution of this Agreement blank stock powers for use in connection with the
transfer to the Company or its designee of Option Shares that do not become vested.
(d) Adjustments. The number of Option Shares and the Option Exercise Price per Option
Share shall be automatically adjusted to reflect any stock split, stock dividend, recapitalization,
merger, consolidation, reorganization, combination or exchanges of shares or other similar event
affecting the Company’s outstanding Common Stock subsequent to the date of this Agreement. If
Grantee becomes entitled to receive any additional shares of Common Stock or other securities
(“Additional Securities”) in respect of the Option Shares prior to the exercise of the Option, the
total number of Option Shares shall be equal to the sum of (i) the initial Option Shares; and, (ii)
the number of Additional Securities issued or issuable in respect of the initial Option Shares and
any Additional Securities previously issued to Grantee. The Option Exercise Price per Option Share
shall be equal to the applicable Option Exercise Price per Option Share set forth in Section 10(a)
(as adjusted pursuant to the first sentence of this Section 10(d)) divided by the sum of (a) the
number of Additional Securities issued or issuable in respect of each Option Share and any
Additional Securities previously issued to Grantee plus (b) the initial Option Share.
11. Restrictive Legends and Stop-Transfer Orders.
(a) Legends. Grantee understands and agrees that the Company will place the legends
set forth below or similar legends on any stock certificate(s) evidencing the Common Stock,
together with any other legends that may be required by state or U.S. Federal securities laws, the
Company’s Certificate of Incorporation or Bylaws, any other agreement between Grantee and the
Company or any agreement between Grantee and any third party:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER THE SECURITIES LAWS OF CERTAIN
STATES. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE
AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT
AND APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION
THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE
FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER OF
THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN
COMPLIANCE WITH THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS.
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(b) Stop-Transfer Instructions. Grantee agrees that, to ensure compliance with the
restrictions imposed by this Agreement, the Company may issue appropriate “stop-transfer”
instructions to its transfer agent, if any, and if the Company transfers its own securities, it may
make appropriate notations to the same effect in its own records.
(c) Refusal to Transfer. The Company will not be required (i) to transfer on its
books any shares of Common Stock that have been sold or otherwise transferred in violation of any
of the provisions of this Agreement or (ii) to treat as owner of such shares, or to accord the
right to vote or pay dividends to any purchaser or other transferee to whom such shares have been
so transferred.
12. Modification. The Agreement may not be amended or modified except in writing signed by
both parties.
13. Plan. Except as otherwise provided herein, or unless the context clearly indicates
otherwise, capitalized terms herein which are defined in the Plan have the same definitions as
provided in the Plan. The terms and provisions of the Plan are incorporated herein by reference,
and the Grantee hereby acknowledges receiving a copy of the Plan. In the event of a conflict or
inconsistency between the terms and provisions of the Plan and the provisions of this Agreement,
the Plan shall govern and control.
14. Interpretation. Any dispute regarding the interpretation of this Agreement shall be
submitted by Grantee or the Company to the Board for review. The resolution of such a dispute by
the Board shall be final and binding on the Company and Grantee.
15. Entire Agreement. The Plan is incorporated herein by reference. This Agreement and the
Plan constitute the entire agreement of the parties and supercede all prior undertakings and
agreements with respect to the subject matter hereof. If any inconsistency should exist between
the nondiscretionary terms and conditions of this Agreement and the Plan, the Plan shall govern and
control.
16. Notices. Any notice required to be given or delivered to the Company under the terms of
this Agreement shall be in writing and addressed to the Corporate Secretary of the Company at its
principal corporate offices. Any notice required to be given or delivered to Grantee shall be in
writing and addressed to Grantee at the address indicated on the signature page hereof or to such
other address as such party may designate in writing from time to time to the Company. All notices
shall be deemed to have been given or delivered upon: (a) personal delivery; (b) three (3) days
after deposit in the United States mail by certified or registered mail (return receipt requested);
(c) one (1) business day after deposit with any return receipt express courier (prepaid); or (d)
one (1) business day after transmission by facsimile or telecopier.
17. Successors and Assigns. The Company may assign any of its rights under this Agreement.
This Agreement shall be binding upon and inure to the benefit of the successors and assigns of the
Company. Subject to the restrictions on transfer set forth herein, this Agreement shall be binding
upon Grantee and Grantee’s heirs, executors, administrators, legal representatives, successors and
assigns.
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18. Governing Law. This Agreement shall be governed by and construed in accordance with the
laws of the State of Delaware without giving effect to its conflict of law principles. If any
provision of this Agreement is determined by a court of law to be illegal or unenforceable, then
such provision will be enforced to the maximum extent possible and the other provisions will remain
fully effective and enforceable.
19. Acceptance. Grantee hereby acknowledges receipt of a copy of the Plan and this Agreement.
Grantee has read and understands the terms and provisions thereof, and accepts the Award subject
to all the terms and conditions of the Plan and this Agreement. Grantee acknowledges that there
may be adverse tax consequences upon exercise of the Award or disposition of the Shares and that
Grantee should consult a tax advisor prior to such exercise or disposition.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have signed this Agreement as of the date first above
written.
| CINEMARK HOLDINGS, INC. | ||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| GRANTEE | ||||
| Name: | ||||
| Address: | ||||
Signature Page to
Restricted Share Award Agreement
Restricted Share Award Agreement