THIS
RESTRICTED STOCK AWARD GRANT NOTICE (this “Notice”) is made as of the
date in the box above labeled “Date of Grant” by Huntington Bancshares
Incorporated, a Maryland corporation and its subsidiaries (the “Company”), and
is hereby communicated to the employee named in the box above (the
“Employee”).
WHEREAS,
under an employment
agreement between the Company and the Employee dated December 20, 2006 (the
“Employment Agreement”), the Employee is entitled to receive an amount of
restricted shares of common stock of the Company (“Restricted Stock”)
approximately equal in value to $5,038,489 as of the effective
date of the merger transaction (the “Effective Date”) described in the Agreement
and Plan of Merger, dated as of December 20, 2006, between the Company, Penguin
Acquisition, LLC—a wholly owned subsidiary of the Company—and Sky Financial
Group, Inc. (the “Merger”).
WHEREAS,
the Company agreed to
grant an award of Restricted Stock under the Employment Agreement to serve
as an
inducement material to the Employee's entering into employment with the Company
after the Merger.
WHEREAS,
the Effective Date is
anticipated to be July 1, 2007.
WHEREAS,
the Company desires
to compensate the Employee with a grant of Restricted Stock to satisfy its
obligations under the Employment Agreement.
NOW,
THEREFORE, in
consideration of the premises, the Company grants the Employee an award of
Restricted Stock under the following terms and conditions:
1. Grant
of Restricted Stock.
The
Company, by authority of its Board of
Directors (the “Board”), hereby grants to the Employee an award of the number of
shares of Restricted Stock identified above (the “Grant”) to be issued in
accordance with all of the terms and conditions set forth in this
Notice. For purposes of calculating the number of Shares of
Restricted Stock identified in the Grant, the term “Fair Market Value” means the
closing price at which the shares were quoted on the NASDAQ National Market
or
such other established securities market on which the shares are traded on
the
Date of Grant, or, if there were no reported sales of shares on such date,
the
business day immediately preceding the Date of Grant. The Restricted
Stock will be issued and registered in the name of the Employee, subject
to the
restrictions set forth in this Notice.
2. Vesting
and Forfeiture Provisions.
(a) The
Employee’s Restricted Stock will vest in equal monthly installments on the last
day of each calendar month of his employment from the Date of Grant through
December 31, 2009. If the
application
of this
paragraph results in the Employee vesting in a fraction of a share of the
Company’s common stock each month, the Company will calculate the sum of the
fractional shares (the “Fractional Share Sum”), and the Employee will vest in an
additional whole share of Restricted Stock each month until the amount of
such
additional shares of Restricted Stock exceeds the Fractional Share
Sum.
(b) Except
as otherwise provided in Section 2 of this Notice, if the Employee’s employment
terminates for any reason other than death before all of the Employee’s
Restricted Stock has become vested under this Notice, the shares of the
Employee’s Restricted Stock that have not vested shall be forfeited on and after
the effective date of the termination. If the Employee incurs a
termination of employment by reason of death, the Employee shall become
immediately vested in 100% of the shares of Restricted Stock.
(c) Notwithstanding
any provision to the contrary, if the Employee’s employment with the Company is
terminated (i) involuntarily without Cause (as defined in Section 5(b) of
the
Employment Agreement) or (ii) for Good Reason (as defined in Section 5(c)
of the
Employment Agreement), the Employee shall become immediately vested in 100%
of
the shares of Restricted Stock.
(d) Notwithstanding
any provision to the contrary, upon the occurrence of a Change in Control,
the
Employee shall become immediately vested in 100% of the shares of Restricted
Stock. For purposes of this Notice, a “Change in Control,” with
respect to the Company, means the occurrence of any of the
following:
(1) Any
“person”
(as
such term is
used in Sections 13(d) and 14(d) of the Exchange Act as in effect as of the
date
of this Agreement), other than the Corporation or any “person” who as of the
Effective Date is a Director or officer of the Company or whose shares of
common
stock of the Company are treated as “beneficially owned” (as such term is used
in Rule 13d-3 of the Exchange Act as in effect as of the Date of Grant) by
any
such director or officer, becomes the beneficial owner, directly or indirectly,
of securities of the Company representing thirty percent (35%) or more of
the
combined voting power of the Company’s then outstanding securities;
(2) Individuals
who, as of the Date
of Grant, constitute the Board of Directors of the Company (the “Incumbent
Board”) cease for any reason to constitute at least a majority of the Board,
provided, however, that any individual becoming a director subsequent to
the
date hereof whose election, or nomination for election, was approved by a
vote
of at least a majority of the directors comprising the Incumbent Board shall
be
considered as though such individual were a member of the Incumbent Board,
but
excluding for this purpose any such individual whose initial assumption of
office occurs as a result of either an actual or threatened election contest
(as
such terms are used in Regulation 14A 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;
(3) A
merger or consolidation of the
Company, other than a merger or consolidation in which the voting securities
of
the Company immediately prior to the merger or consolidation continue to
represent (either by remaining outstanding or being converted into securities
of
the surviving entity) fifty-one percent (51%) or more of the combined voting
power of the Company or surviving entity immediately after the merger or
consolidation with another entity;
(4) A
sale, exchange, lease,
mortgage, pledge, transfer, or other disposition (in a single transaction
or a
series of related transactions) of all or substantially all of the assets
of the
Company which shall include, without limitation, the sale of assets or earning
power aggregating more than fifty percent (50%) of the assets or earning
power
of the Company on a consolidated basis;
(5) A
liquidation or dissolution of
the Company;
(6) A
reorganization, reverse stock
split, or recapitalization of the Company which would result in any of the
foregoing; or
(7) A
transaction or series of
related transactions having, directly or indirectly, the same effect as any
of
the foregoing.
(e) The
Company will not have any further obligations to the Employee under this
Grant
if any of the Employee’s shares of Restricted Stock are forfeited as provided
herein, including the payment of any dividends provided for in this
Notice.
3. Certificates
for Shares of Restricted Stock Granted. The Company
shall either issue certificates in respect of the shares of Restricted Stock
granted to the Employee or hold the shares electronically with its transfer
agent in the name of the Employee and for the benefit of the Employee until
the
shares represented thereby become vested. Such certificates or account shall
bear the following legend:
"The
transferability
of this certificate or account and the shares of stock represented hereby
are
subject to an agreement between the Company and the registered holder, a
copy of
which is on file at the principal office of this Company."
4. Issuance
of Stock.
The
Company, or its transfer agent, will
deliver the vested shares of the Restricted Stock and any related stock power
to
the Employee as soon as practicable after such shares of Restricted Stock
become
vested, subject to payment of the applicable withholding tax liability as
set
forth below. If the Employee dies before the Company has distributed
any portion of the vested Restricted Stock, the Company will transfer any
shares
payable with respect to the vested Restricted Stock in accordance with the
Employee’s written beneficiary designation or to the Employee’s estate if no
written beneficiary designation is provided. If the Employee did not
have a will, any shares payable with respect to the vested Restricted Stock
will
be distributed in accordance with the laws of descent and
distribution.
5. Withholding
Taxes.
The
Company shall have the power and the right
to deduct or withhold, or require the Employee to remit to the Company, an
amount sufficient to satisfy federal, state, local and foreign taxes required
by
law or regulation to be withheld with respect to any taxable event arising
as a
result of this Notice, including the payment of shares or cash. With
regard to the above, the Company is permitted to withhold a number of shares
having a fair market value equal to Employee’s withholding obligations, based on
the minimum federal, state and local and other tax withholding rate, and
to pay
this amount to the Internal Revenue Service or other taxing authority on
the
Employee’s behalf. Delivery or withholding of fractional shares is
not permitted, and as such, the Company may round any fractional shares up
or
down to the next whole share to satisfy the withholding
obligations.
6. Conditions
to Delivery of Shares.
The
shares of stock held by the transfer
agent may be either previously authorized but unissued shares or issued shares
which have been reacquired by the Company. The Company shall not be
required to issue any certificate or certificates for shares of stock hereunder
prior to fulfillment of all of the following conditions: (a) the
admission of such shares to listing on all stock exchanges on which such
class
of stock is then listed; (b) the completion of any registration or other
qualification of such shares under any State or Federal law or under the
rulings
or regulations of the Securities and Exchange Commission or any other
governmental regulatory body, which the Committee shall, in its absolute
discretion, deem necessary or advisable; (c) the obtaining of any approval
or
other clearance from any
State
or Federal governmental agency,
which the Committee shall, in its absolute discretion, determine to be necessary
or advisable; (d) the lapse of such reasonable period of time following the
Date
of Grant and during which the Compensation Committee of the Company’s Board of
Directors (the “Committee”) reasonably believes that the issuance of shares
would violate any applicable laws, government regulations, requirements of
any
securities exchange on which the Corporation’s Shares are traded, or any insider
trading policy of the Corporation; and (e) the lapse of such reasonable period
of time following the date of grant of the shares of Restricted Stock as
the
Committee may establish from time to time for reasons of administrative
convenience.
7. Restriction
on Transferability.
Until
the shares of Restricted Stock have
vested under this Notice, the Restricted Stock granted herein and the rights
and
privileges conferred hereby may not be sold, transferred, pledged, assigned,
or
otherwise alienated or hypothecated (by operation of law or
otherwise). Any attempted transfer in violation of the provisions of
this paragraph shall be void, and the purported transferee shall obtain no
rights with respect to such Restricted Stock.
8. Rights
as Stockholder.
Subject
to the limitations provided in this
Notice, the Employee shall have all the rights of a stockholder of the Company,
including voting rights and the right to receive dividends with respect to
shares of Restricted Stock that have not yet vested.
9. Capital
Adjustment Provisions.
In
the event of a stock split, stock dividend,
reclassification, reorganization, redesignation, or other change in the
Company’s capitalization or corporate structure, the number and class of shares
of Restricted Stock shall be proportionately adjusted or substituted to reflect
such change.
10. Employment
Under the Employment
Agreement.
The
Employee understands and agrees that his
employment with the Company is determined under the Employment
Agreement.
11. Authority
of the Compensation Committee.
The
Compensation Committee of the Company’s
Board of Directors (the “Committee”) shall have the power to construe and
interpret the provisions of this Notice and may correct any defect, supply
any
omission or reconcile any inconsistency in the Notice in the manner and to
the
extent it shall deem desirable to carry the Notice into
effect. Further, the Committee shall make all other determinations
which may be necessary or advisable for the administration of the
Notice. All determinations and decisions made by the Committee shall
be final, conclusive, and binding on all persons, including the Company,
the
Employee, and the Employee’s estate and beneficiaries.
12. Addresses
for Notices.
Any
notice to be given to the Company under the
terms of this Notice shall be addressed to the Company, in care of the
Compensation Director, at Huntington Bancshares Incorporated, Huntington
Center,
HC0318, 41 S. High Street, Columbus, Ohio 43287, or at such other
address as the Company may hereafter designate in writing. Any notice
to be given to the Employee shall be addressed to the Employee at the address
maintained on the books and records of the Company.
13. Captions.
Captions
provided herein are for convenience
only and are not to serve as a basis for interpretation or construction of
this
Notice.
14. Notice
Severable.
In
the event that any provision in this Notice
shall be held invalid or unenforceable, such provision shall be severable
from,
and such invalidity or unenforceability shall not be construed to have any
effect on, the remaining provisions of this Notice.
15. Expenses.
Costs
of administration of the terms and
conditions of this Notice will be paid by the Company.
16. Governing
Law.
The
terms and conditions of this Notice shall
be governed by the laws of the State of Ohio, except to the extent preempted
by
federal law.
17. Entire
Notice; Amendment.
This
Notice contains the terms and conditions
with respect to the subject matter hereof and supersede any previous agreements,
written or oral, relating to the subject matter hereof. The
Company may not amend, alter, suspend, discontinue or terminate any provision
of
this Notice in a manner that may adversely affect the Employee without the
Employee’s (or his legal representative’s) written consent.
18. Employee’s
Acceptance.
The
Employee shall signify his acceptance of
the terms and conditions of this Notice by signing in the space provided
below,
by signing any related stock power, and by returning a signed copy of these
documents to the Company.
Please
retain this
Notice, as it is the official statement of the key terms of your
award. If you have any questions regarding the administration of this
Notice, please contact Joan Snyder at (614) 480-4885 or Holly Bush at (614)
480-3011.
|
/s/
Thomas E.
Hoaglin
|
|
June
26,
2007
|
|
| Thomas
E.
Hoaglin |
|
Date
|
|
|
Chairman,
President and Chief Executive Officer
|
|
|
|
| /s/
Marty E.
Adams |
|
July
2,
2007
|
|
|
Marty
E.
Adams
|
|
Date
|
|
