Black Hills Corporation Restricted Stock Award Agreement Dear ________________________:
Black
Hills Corporation
2005
Omnibus Incentive Plan
Dear
________________________:
Congratulations
on your selection as a Participant of Black Hills Corporation 2005 Omnibus
Incentive Plan (the “Plan”). This Agreement and the Plan together govern your
rights under the Plan and set forth all of the conditions and limitations
affecting such rights. Terms used in this Agreement that are defined in the
Plan
shall have the meanings ascribed to them in the Plan. If there is any
inconsistency between the terms of this Agreement and the terms of the Plan,
the
Plan’s terms shall supersede and replace the conflicting terms of this
Agreement.
Overview
of Your Award
| 1. |
Number
of Restricted Shares Granted.
______________________
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| 2. |
Date
of Grant.
___________________________________________
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| 3. |
Date
of Lapse of Restrictions.
|
Shares Date
_____________________________ _____________________________
_____________________________ _____________________________
_____________________________ _____________________________
| 4. |
Employment
by the Company.
This Restricted Stock is awarded on the condition that the Participant
remain in the employ of Black Hills Corporation (the “Company”) from the
Date of Grant through (and including) the Dates of Lapse of Restrictions.
The Award of this Restricted Stock, however, shall not impose upon
the
Company any obligations to retain the Participant in its employ for
any
given period or upon any specific terms of
employment.
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| 5. |
Certificate
Legend.
Shares of Restricted Stock granted pursuant to the Plan shall be
held by
the Company in book entry form and shall be designated to have the
following legend:
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“The
sale or other transfer of the shares of stock represented by this
certificate, whether voluntary, involuntary, or by operation of law,
is
subject to certain restrictions on transfer set forth in the Black
Hills
Corporation 2005 Omnibus Incentive Plan and in a Restricted Stock
Award
Agreement. A copy of the Plan and such Restricted Stock Agreement
may be
obtained from the Secretary of Black Hills
Corporation.”
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| 6. |
Removal
of Restrictions.
Except as otherwise provided in the Plan, each of the Shares of Restricted
Stock granted under this Agreement shall become freely transferable
by the
Participant on each of the “Dates of Lapse of Restrictions” set forth on
Paragraph 3 herein.
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Once
the
shares are released from the restrictions, the Participant shall be entitled
to
receive certificates representing the Shares of stock which have been vested,
without the restrictive legend required by Paragraph 5 of this Agreement.
Notwithstanding
the terms of this Agreement, no stock shall be issued by the Corporation while
its stock transfer books are closed.
| 7. |
Voting
Rights and Dividends.
During the Period of Restriction, the Participant may exercise full
voting
rights and is entitled to receive all dividends and other distributions
paid with respect to the Shares of Restricted Stock while they are
held.
If any such dividends or distributions are paid in shares of Common
Stock
of the Company, the Shares shall be subject to the same restrictions
on
transferability as the Shares of Restricted Stock with respect to
which
they were paid.
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| 8. |
Termination
of Employment By Reasons of Death, Disability, Retirement, and Vesting
in
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Connection
with a Change in Control.
In the event the Participant’s employment is terminated by reason of
Death, Disability, Retirement, or in the event of a Change in Control
prior to the Dates of Lapse of Restrictions, all Shares of Restricted
Stock then outstanding shall immediately vest one hundred percent
(100%),
and as soon as is administratively practicable, the stock certificates
representing the Shares of Restricted Stock without any restrictions
or
legend thereon, shall be delivered to the Participant’s beneficiary or
estate.
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"Change
in Control" of the Company shall be deemed to have occurred (as of a particular
day, as specified by the Board) upon the occurrence of any of the following
events:
| (a) |
The
acquisition in a transaction or series of transactions by any Person
of
Beneficial Ownership of thirty percent (30%) or more of the combined
voting power of the then outstanding shares of common stock of the
Company; provided, however, that for purposes of this Agreement,
the
following acquisitions will not constitute a Change in Control: (A)
any
acquisition by the Company; (B) any acquisition of common
stock of
the Company by an underwriter holding securities of the Company in
connection with a public offering thereof; and (C) any acquisition
by any
Person pursuant to a transaction which complies with subsections
(c) (i),
(ii) and (iii), below;
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(b)
Individuals
who, as of December 31, 2004 are members of the Board (the "Incumbent Board"),
cease for any reason to constitute at least a majority of the members of the
Board; provided, however, that if the election, or nomination for election
by
the Company's common shareholders, of any new director was approved by a vote
of
at least two-thirds of the Incumbent Board, such new director shall, for
purposes of this Plan, be considered as a member of the Incumbent Board;
provided further, however, that no individual shall be considered a member
of
the Incumbent Board if such individual initially assumed office as a result
of
either an actual or threatened "Election Contest" (as described in Rule 14a-11
promulgated under the Exchange Act) or other actual or threatened solicitation
of proxies or consents by or on behalf of a Person other than the Board (a
"Proxy Contest") including by reason of any agreement intended to avoid or
settle any Election Contest or Proxy Contest;
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(c)
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Consummation,
following shareholder approval, of a reorganization, merger, or
consolidation of the Company and/or its subsidiaries, or a sale or
other
disposition (whether by sale, taxable or non-taxable exchange, formation
of a joint venture or otherwise) of fifty percent (50%) or more of
the
assets of the Company and/or its subsidiaries (each a “Business
Combination”), unless, in each case, immediately following such Business
Combination, (i) all or substantially all of the individuals and
entities
who were beneficial owners of shares of the common stock of the Company
immediately prior to such Business Combination beneficially own,
directly
or indirectly, more that fifty percent (50%) of the combined voting
power
of the then outstanding shares of the entity resulting from the Business
Combination or any direct or indirect parent corporation thereof
(including, without limitation, an entity which as a result of such
transaction owns the Company or all or substantially all of the Company’s
assets either directly or through one (1) or more subsidiaries)(the
“Successor Entity”); (ii) no Person (excluding any Successor entity or any
employee benefit plan or related trust, of the Company or such Successor
Entity) owns, directly or indirectly, thirty percent (30%) or more
of the
combined voting power of the then outstanding shares of common stock
of
the Successor Entity, except to the extent that such ownership existed
prior to such Business Combination; and (iii) at least a majority
of the
members of the Board of Directors of the entity resulting from such
Business Combination or any direct or indirect parent corporation
thereof
were members of the Incumbent Board at the time of the execution
of the
initial agreement or action of the Board providing for such Business
Combination; or
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(d)
Approval
by the shareholders of the Company of a complete liquidation or dissolution
of
the Company, except pursuant to a Business Combination that complies with
subsections (c) (i), (ii), and (iii) above.
(e)
A
Change
in Control shall not be deemed to occur solely because any Person (the "Subject
Person") acquired Beneficial Ownership of more than the permitted amount of
the
then outstanding Common Stock as a result of the acquisition of Common Stock
by
the Company which, by reducing the number of shares of Common Stock then
outstanding, increases the proportional number of shares Beneficially Owned
by
the Subject Persons, provided that if a Change in Control would occur (but
for
the operation of this sentence) as a result of the acquisition of Common Stock
by the Company, and after such stock acquisition by the Company, the Subject
Person becomes the Beneficial Owner of any additional Common Stock which
increases the percentage of the then outstanding Common Stock Beneficially
Owned
by the Subject Person, then a Change in Control shall occur.
(f)
A
Change
in Control shall not be deemed to occur unless and until all regulatory
approvals required in order to effectuate a Change in Control of the Company
have been obtained and the transaction constituting the Change in Control has
been consummated.
| 9. |
Beneficiary
Designation.
The Participant may, from time to time, name any beneficiary or
beneficiaries (who may be named contingently or successively) to
whom any
benefit under this Agreement is to be paid in case of his or her
death
prior to the Dates of Lapse of Restrictions. Each such designation
shall
revoke all prior designations by the Participant, shall be in a form
prescribed by the Company, and will be effective only when filed
by the
Participant in writing with the Company during the Participant’s lifetime.
In the absence of any such designation, benefits remaining unpaid
at the
Participant’s death shall be paid to the Participant’s
estate.
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| 10. |
Termination
of Employment for Other Reasons.
In the event the Participant’s employment is terminated for reasons other
than those described in Section 8 herein prior to the Dates of the
Lapse
of Restrictions, all outstanding Shares of unvested Restricted Stock
granted hereunder shall immediately be forfeited by the
Participant.
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| 11. |
Transferability.
This Restricted Stock is not transferable by the Participant, whether
voluntarily or involuntarily, by operation of laws or otherwise,
during
the Restriction Period, except as provided in the Plan. If any assessment,
pledge, transfer, or other disposition, voluntary or involuntary,
of this
Restricted Stock shall be made, or if any attachment, execution,
garnishment, or client shall be issued against or placed upon the
Restricted Stock, then the Participant’s right to the Restricted Stock
shall immediately cease and terminate and the Participant shall promptly
forfeit to the Company all Restricted Stock awarded under this
Agreement.
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| 12. |
Tax
Treatment.
The following is a brief summary of the principal federal income
tax
consequences related to grants of restricted stock. This summary
is based
on the Company’s understanding of present federal income tax law and
regulations. The summary does not purport to be complete or applicable
to
every specific situation.
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The
value
of restricted stock granted to the Participant will be taxable to the
Participant in the year in which it is no longer subject to substantial risk
of
forfeiture (i.e., when the restrictions lapse). When the restrictions lapse,
there is an ordinary income tax event to the Participant equal to the number
of
shares multiplied by the market price of the shares at the time the restrictions
lapse. The Participant must satisfy federal and state withholding requirements
and may do so by having the Company sell sufficient shares to meet the
withholding requirements.
The
Participant has the option to make a Code Section 83(b) election on a grant
of
restricted stock. Code Section 83(b) allows the Participant to choose to be
taxed immediately on the amounts received in connection with a substantially
“nonvested” right (i.e., compensation that has not been constructively
received). This is accomplished by the Participant filing an election with
the
IRS stating that he or she will pay ordinary income on the value as measured
at
the time of grant. Any future appreciation in the stock property will be treated
as capital gain when sold. This election must be made within 30 days after
the
stock is received.
If
the
Participant elects Section 83(b) treatment and later forfeits the subject stock,
he or she will not be entitled to any refund for the taxes paid; however, he
or
she will be entitled to treat the forfeiture as a sale of the stock at a loss
(i.e., capital loss) (limited
to the amount paid for shares--typically zero).
| 13. |
Withholding.
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Tax
Withholding.
The
Company shall have the power and the right to deduct or withhold, or require
the
Participant to remit to the Company, an amount sufficient to satisfy federal,
state and local taxes (including Participant’s FICA obligation), domestic or
foreign, required by law or regulation to be withheld with respect to any
taxable event arising as a result of this Plan.
Share
Withholding.
With
respect to withholding required upon the lapse of restrictions or upon any
other
taxable event arising as a result of the Awards granted hereunder, the
Participants may elect, subject to the approval of the Board, to satisfy the
withholding requirement, in whole or in part, by having the Company withhold
shares having a Fair Market Value on the date the tax is to be determined equal
to the minimum statutory total tax that could be imposed on the transaction.
All
such elections shall be irrevocable, made in writing, signed by the Participant,
and shall be subject to any restrictions or limitations that the Committee,
in
its sole discretion, deems appropriate.
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| 14. |
Requirements
of Law.
The issuance of Shares under the Plan shall be subject to all applicable
laws, rules, and regulations, and to such approvals by any governmental
agencies or national securities exchanges as may be
required.
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| 15. |
Inability
to Obtain Authorization.
The inability of the Company to obtain authority from any regulatory
body
having jurisdiction, which authority is deemed by the Company’s counsel to
be necessary to the lawful issuance of any Shares hereunder, shall
relieve
the Company of any liability in respect of the failure to issue such
Shares as to which such requisite authority shall not have been
obtained.
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| 16. |
Severability.
In the event any provision of this Agreement shall be held to be
illegal
or invalid for any reason, the illegality or invalidity shall not
affect
the remaining parts of this Agreement, and the Agreement shall be
construed and enforced as if the illegal or invalid provision had
not been
included.
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| 17. |
Continuation
of Employment.
This Agreement shall not confer upon the Participant any right to
continuation of employment by the Company, nor shall this Agreement
interfere in any way with the Company’s right to terminate the
Participant’s employment at any
time.
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| 18. |
Applicable
Laws and Consent to Jurisdiction.
The validity, construction, interpretation and enforceability of
this
Agreement shall be determined and governed by the laws of the State
of
South Dakota without giving effect to the principles of conflicts
of law.
For the purpose of litigating any dispute that arises under this
Agreement, the parties hereby consent to exclusive jurisdiction in
South
Dakota and agree that such litigation shall be conducted in the courts
of
▇▇▇▇▇▇▇▇▇▇ County or the federal courts of the United States for
the
District of South Dakota, Western
Division.
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| 19. |
Miscellaneous.
The Plan may be amended at any time, and from time to time, by a
written
instrument approved by the Board of Directors of Black Hills Corporation.
No termination, amendment or modification of the Plan shall adversely
affect in any material way any Award previously granted under the
Plan,
without the written consent of the Participant holding such Award.
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The
Plan
and this Agreement are binding upon Participant, as well as his/her heirs,
executors, personal representatives, trustees, attorneys, agents,
administrators, and successors.
Please
refer any questions you may have regarding your restricted stock to
______________________. Once again, congratulations on receipt of your
restricted stock.
Sincerely,
_____________________________________________
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Please
acknowledge your agreement to participate in the Plan and this Agreement, and
to
abide by all of the governing terms and provisions, by signing the following
representation:
Agreement
to Participate
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By
signing a copy of this Agreement and returning it to _____________________
of Black Hills Corporation, I acknowledge that I have read the Plan,
and
that I fully understand all of my rights under the Plan, as well
as all of
the terms and conditions which may limit my eligibility to exercise
this
Award. Without limiting the generality of the preceding sentence,
I
understand that my right to exercise this Award is conditioned upon
my
continued employment with Black Hills Corporation or its
Subsidiaries.
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___________________________________