ful20180417

0001437749-18-007073.txt : 20180418 0001437749-18-007073.hdr.sgml : 20180418 20180418115833 ACCESSION NUMBER: 0001437749-18-007073 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20180412 ITEM INFORMATION: Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers: Compensatory Arrangements of Certain Officers ITEM INFORMATION: Submission of Matters to a Vote of Security Holders ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20180418 DATE AS OF CHANGE: 20180418 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FULLER H B CO CENTRAL INDEX KEY: 0000039368 STANDARD INDUSTRIAL CLASSIFICATION: ADHESIVES & SEALANTS [2891] IRS NUMBER: 410268370 STATE OF INCORPORATION: MN FISCAL YEAR END: 1203 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-09225 FILM NUMBER: 18760598 BUSINESS ADDRESS: STREET 1: 1200 WILLOW LAKE BLVD CITY: ST PAUL STATE: MN ZIP: 55110-5132 BUSINESS PHONE: 6126453401 8-K 1 ful20180417_8k.htm FORM 8-K ful20180417_8k.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): April 12, 2018

H.B. FULLER COMPANY

(Exact name of registrant as specified in its charter)

Minnesota

001-09225

41-0268370

(State or other jurisdiction

of incorporation)

(Commission file number)

(I.R.S. Employer Identification No.)

1200 Willow Lake Boulevard

P.O. Box 64683

St. Paul, MN 55164-0683

(Address of principal executive offices, including zip code)

Registrant's telephone number, including area code: (651) 236-5900

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

Emerging growth company [ ]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(e) On April 12, 2018 at the 2018 Annual Meeting of Shareholders of H.B. Fuller Company (the “Company”), the shareholders of the Company approved the H.B. Fuller Company 2018 Master Incentive Plan. Effective the same day, the Compensation Committee of the Board of Directors of the Company approved the forms of Non-Qualified Stock Option Agreement, Restricted Stock Unit Award Agreement, Restricted Stock Unit Award Agreement for the CEO, Performance Share Award Agreement, and Restricted Stock Unit Award Agreement for Non-Employee Directors attached to this Report as Exhibits 10.1, 10.2, 10.3, 10.4 and 10.5 respectively.

The Non-Qualified Stock Option Agreement and the Restricted Stock Unit Award Agreement forms provide for multi-year vesting of options and restricted stock units respectively in equal annual installments. The Restricted Stock Unit Award Agreement for the CEO allows for vesting of restricted stock units in equal installments over a multi-year period only if one or more performance criteria are met at a threshold or higher level. The Performance Share Award Agreement provides for multi-year vesting of restricted stock units in annual installments in the event that performance criteria are met at least at a threshold level. The number of restricted stock units that vest may increase from the threshold level if higher levels of performance are achieved for specified performance periods. The Restricted Stock Unit Award Agreement for Non-Employee Directors provides for a vesting of restricted stock units on the earlier of a date certain or the date a director reaches the mandatory retirement age. The foregoing description is qualified in its entirety by reference to the forms of the Agreements, copies of which are filed as Exhibits 10.1, 10.2, 10.3, 10.4 and 10.5 respectively to this Current Report on Form 8-K and are incorporated herein by reference.

Item 5.07 Submission of Matters to a Vote of Security Holders.

On April 12, 2018, H.B. Fuller Company (the “Company”) held its 2018 Annual Meeting of Shareholders (“Annual Meeting”) for the purposes of the election of three directors for a three-year term, a non-binding advisory vote to approve the compensation of our named executive officers disclosed in the proxy statement, the ratification of the appointment of KPMG LLP as H.B. Fuller’s independent registered public accounting firm for the fiscal year ending December 1, 2018 and the approval of the H.B. Fuller Company 2018 Master Incentive Plan. As of the record date, there was a total of 50,527,464 shares of Common Stock outstanding and entitled to vote at the Annual Meeting. At the Annual Meeting, 48,292,746 shares of Common Stock were represented in person or by proxy, therefore a quorum was present.

The voting results for the election of three directors for a three year-term were as follows:

	For	Withheld	Broker Non- Votes
Thomas W. Handley	42,785,863	2,150,196	3,356,687
Maria Teresa Hilado	42,946,165	1,989,894	3,356,687
Ruth Kimmelshue	43,576,157	1,359,902	3,356,687

The voting results on a non-binding advisory vote to approve the compensation of the Company’s named executive officers disclosed in the Company’s 2018 proxy statement were as follows:

For			Against			Abstain			Broker Non-Votes
26,534,107			18,130,147			271,805			3,356,687

Votes regarding ratification of the appointment of KPMG LLP as the independent registered public accounting firm for the fiscal year ending December 1, 2018, were as follows:

For			Against			Abstain
47,682,365			399,582			210,799

The voting results on the approval of the H.B. Fuller Company 2018 Master Incentive Plan were as follows:

For			Against			Abstain			Broker Non-Votes
37,848,553			6,820,599			266,907			3,356,687

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

10.1

Form of Non-Qualified Stock Option Agreement under the H.B. Fuller Company 2018 Master Incentive Plan for awards made on or after April 12, 2018

10.2

Form of Restricted Stock Unit Award Agreement under the H.B. Fuller Company 2018 Master Incentive Plan for awards made on or after April 12, 2018

10.3

Form of Restricted Stock Unit Award Agreement for the CEO under the H.B. Fuller Company 2018 Master Incentive Plan for awards made on or after April 12, 2018

10.4

Form of Performance Share Award Agreement under the H.B. Fuller Company 2018 Master Incentive Plan for awards made on or after April 12, 2018

10.5

Form of Restricted Stock Unit Award Agreement for Non-Employee Directors under the H.B. Fuller Company 2018 Master Incentive Plan for awards made on or after April 12, 2018

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: April 18, 2018

	H.B. FULLER COMPANY



	By:	/s/ Timothy J. Kenan
		Timothy J. Kenan
		Vice President, General Counsel
		and Corporate Secretary

EXHIBIT INDEX

Exhibit No. Description

10.1

Form of Non-Qualified Stock Option Agreement under the H.B. Fuller Company 2018 Master Incentive Plan for awards made on or after April 12, 2018

10.2

Form of Restricted Stock Unit Award Agreement under the H.B. Fuller Company 2018 Master Incentive Plan for awards made on or after April 12, 2018

10.3

Form of Restricted Stock Unit Award Agreement for the CEO under the H.B. Fuller Company 2018 Master Incentive Plan for awards made on or after April 12, 2018

10.4

Form of Performance Share Award Agreement under the H.B. Fuller Company 2018 Master Incentive Plan for awards made on or after April 12, 2018

10.5

Form of Restricted Stock Unit Award Agreement for Non-Employee Directors under the H.B. Fuller Company 2018 Master Incentive Plan for awards made on or after April 12, 2018

EX-10.1 2 ex_110539.htm EXHIBIT 10.1 ex_110539.htm

Exhibit 10.1

H.B. FULLER COMPANY

NON-QUALIFIED STOCK OPTION AGREEMENT

(Under the H.B. Fuller Company 2018 Master Incentive Plan)

THIS AGREEMENT, dated as of ________________, 20__ (the "Grant Date") is entered into between H.B. Fuller Company, a Minnesota corporation (the “Company”), and ______________, an employee of the Company or an Affiliate of the Company (“Participant”).

WHEREAS, the Company, pursuant to the H.B. Fuller Company 2018 Master Incentive Plan (the “Plan”), wishes to grant stock options for the purchase of Common Stock, par value $1.00 per share, of the Company (“Common Stock”), to Participant on the terms and conditions contained in this Agreement and the Plan;

WHEREAS, Participant’s rights to receive options for the purchase of Common Stock hereunder are sometimes referred to as the “Option(s)” in this Agreement.

NOW, THEREFORE, in consideration of the premises and agreements set forth herein, the parties hereto hereby agree as follows:

1. Grant of Option. The Company, effective as of the date of this Agreement, hereby grants to Participant, as a matter of separate agreement and not in lieu of salary or other compensation for services rendered, the right and option (the “Option”) to purchase all or any part of an aggregate of ____________ shares of Common Stock (the “Shares”) at the price of $______ per share on the terms and conditions set forth in this Agreement. The Option is not intended to be an incentive stock option within the meaning of the Internal Revenue Code of 1986 (the “Code”), as amended.

2. Vesting and Term of Option.

(a) The Option may not be exercised prior to the one year anniversary date of the Grant Date. Commencing on the first anniversary of the Grant Date, the Option may be exercised by Participant prior to its termination in cumulative annual installments as follows:

		Percentage of Shares as to
Date		which Option is Exercisable

the ____ anniversary of the Grant Date		__%
the ____ anniversary of the Grant Date		__%
the ____ anniversary of the Grant Date		__%
the ____ anniversary of the Grant Date		__%
the ____ anniversary of the Grant Date		__%

The Option shall in all events terminate on_____________, 20__ or such earlier date as prescribed herein.

(b) Notwithstanding the vesting provision contained in Section 2(a) above, but subject to the other terms and conditions set forth herein, the Option may be exercised, in whole or in part, at any time, or from time to time, following the occurrence of a Change in Control of the Company.

(c) For the purposes of this Agreement, a “Change in Control” shall be deemed to have occurred upon any of the following events:

(i) a public announcement (which, for purposes hereof, shall include, without limitation, a report filed pursuant to Section 13(d) of the Exchange Act) that any individual, corporation, partnership, association, trust or other entity becomes the beneficial owner (as defined in Rule 13(d)(3) promulgated under the Exchange Act), directly or indirectly, of securities of the Company representing 30% or more of the Voting Power of the Company then outstanding;

(ii) the individuals who, as of the date of this Agreement, are members of 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 if the election or nomination for election by the Company’s shareholders of any new director was approved by a vote of at least a majority of the Incumbent Board, such new director shall be considered to be a member of the Incumbent Board);

(iii) the approval of the shareholders of the Company, and consummation, of (A) any consolidation, merger or statutory share exchange of the Company with any person in which the surviving entity would not have as its directors at least 60% of the Incumbent Board and as a result of which those persons who were shareholders of the Company immediately prior to such transaction would not hold, immediately after such transaction, at least 60% of the Voting Power of the Company then outstanding or the combined voting power of the surviving entity’s then outstanding voting securities; (B) any sale, lease, exchange or other transfer in one transaction or series of related transactions substantially all of the assets of the Company; or (C) the adoption of any plan or proposal for the complete or partial liquidation or dissolution of the Company; or

(iv) a determination by a majority of the members of the Incumbent Board, in their sole and absolute discretion, that there has been a Change in Control of the Company.

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For purposes of this Section 2(c), “Voting Power” when used with reference to the Company shall mean the voting power of all classes and series of capital stock of the Company now or hereafter authorized.

3. Effect of Termination of Employment. The Option shall terminate and may no longer be exercised if Participant ceases to be employed by the Company or an Affiliate of the Company, except that:

(a) If the Participant voluntarily terminates Participant’s employment or if the Company or an Affiliate of the Company terminates Participant’s employment for any reason other than gross and willful misconduct, disability, retirement or death, Participant may exercise the Option at any time within ninety (90) days after such termination of employment to the extent that the Option was exercisable by Participant on the date of such termination, but not after the expiration of the term of the Option.

(b) If the Company or an Affiliate of the Company terminates Participant’s employment by reason of gross and willful misconduct during the course of employment, including, but not limited to, wrongful appropriation of funds or the commission of a gross misdemeanor or felony, the Option shall be terminated as of the date of termination of the Participant’s employment.

(c) If Participant’s employment is terminated by reason of disability (within the meaning of Section 22(e)(3) of the Code) or retirement, the restrictions on Participant’s ability to exercise any percentage of the Option as set forth in Section 2(a), shall lapse and the Option shall vest in full. If Participant’s employment is terminated by reason of retirement, Participant may exercise the Option at any time prior to the end of the term of the Option, but not after the expiration of the term of the Option. If Participant’s employment is terminated by reason of disability, Participant may exercise the Option at any time within three years after such termination of employment, but not after the expiration of the term of the Option. If Participant shall die following any such termination, the Option may be exercised at any time within 12 months after the date of Participant’s death by the personal representatives or administrators of Participant or by any beneficiary designated in a manner established by the Committee or person or persons to whom the Option has been transferred by will or the applicable laws of descent and distribution, subject to the condition that the Option shall not be exercisable after the expiration of the term of the Option.

(d) If Participant shall die while in the employ of the Company or an Affiliate of the Company, the restrictions on Participant’s (or his or her heirs’) ability to exercise any percentage of the Option as set forth in Section 2(a), shall lapse and the Option shall vest in full. The Option may be exercised at any time within 12 months after the date of Participant’s death by the personal representatives or administrators of Participant or by any beneficiary designated in a manner established by the Committee or person or persons to whom the Option has been transferred by will or the applicable laws of descent and distribution, subject to the condition that the Option shall not be exercisable after the expiration of the term of the Option.

-3-

For avoidance of doubt, if Participant is employed by an Affiliate that is sold or otherwise ceases to be an Affiliate of the Company, Participant shall incur a termination of employment by the Company and all Affiliates of the Company under this Agreement.

4. Method of Exercising Option.

(a) Subject to the terms and conditions of this Agreement, the Option shall be exercised by following the procedures established by the Company from time to time, which may require the delivery of a written or electronic notice of exercise (the “Notice”) to the Company (to the attention of the Equity Compensation Specialist) or its agent. The Notice shall be in such form as the Company may prescribe and shall state the election to exercise the Option, the number of Shares as to which the Option is being exercised and the manner of payment and shall be signed by the person or persons so exercising the Option. The Notice shall be accompanied by payment in full of the exercise price for all Shares designated in the notice. The Notice shall also be accompanied by such other information and documents as the Company, in its discretion, may request. To the extent that the Option is exercised after Participant’s death, the Notice shall also be accompanied by appropriate proof of the right of such person or persons to exercise the Option.

(b) Payment of the exercise price shall be made to the Company through one or a combination of the following methods:

(i)

delivery of a certified or cashier’s check, or a wire transfer, payable to the Company or cash, in United States currency;

(ii)

delivery of shares of Common Stock acquired by Participant more than six months prior to the date of exercise having a Fair Market Value on the date of exercise equal to the Option exercise price. Participant shall duly endorse all certificates delivered to the Company in blank and shall represent and warrant in writing that Participant is the owner of the shares so delivered, free and clear of all liens, encumbrances, security interests and restrictions;

-4-

(iii)

if permitted by the Company in its sole discretion, by executing a “cashless exercise” through the Company’s designated broker; or

(iv)

delivery of an attestation from Participant that Participant owns a number of shares of Common Stock acquired by Participant more than six months prior to the date of exercise having a Fair Market Value on the date of exercise equal to the Option exercise price (the “Exercise Price Shares”). In such attestation, Participant shall represent and warrant that Participant is the owner of the Exercise Price Shares. In the event Participant exercises the Option in this manner, the number of shares of Common Stock issued to Participant upon exercise of the Option shall be (A) the number of shares subject to the Option exercise, less (B) the number of Exercise Price Shares.

5. Income Tax Withholding. In order to provide the Company with the opportunity to claim the benefit of any income tax deduction which may be available to it upon the exercise of the Option, and in order to comply with all applicable federal, state, local and foreign income tax laws or regulations, the Company may take such action as it deems appropriate to ensure that all applicable federal, state, local or foreign payroll, withholding, income or other taxes, which are the sole and absolute responsibility of Participant, are withheld or collected from Participant. Participant may, at Participant’s election (the “Tax Election”), satisfy applicable tax withholding obligations by (a) electing to have the Company withhold a portion of the Shares of Common Stock otherwise to be delivered upon exercise of the Option having a Fair Market Value equal to the amount of such taxes (but only to the extent necessary to satisfy minimum statutory withholding requirements if required under ASC Topic 718) or (b) delivering to the Company shares of Common Stock having a Fair Market Value equal to the amount of such taxes. The Tax Election must be made on or before the date that the amount of tax to be withheld is determined.

-5-

6. Securities Matters. No Shares shall be issued hereunder prior to such time as counsel to the Company shall have determined that the issuance of the Shares will not violate any federal or state securities or other laws, rules or regulations. The Company shall not be required to deliver any Shares of Common Stock until the requirements of any applicable securities or other laws, rules or regulations (including the rules of any securities exchange) as may be determined by the Company to be applicable are satisfied. In addition, the grant of this Option and/or the delivery of any Shares of Common Stock under this Agreement are subject to the Company’s Executive and Key Manager Compensation Clawback Policy and any other clawback policies the Company may adopt in the future to conform to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (or any other applicable law) and any applicable rules and regulations of the Securities and Exchange Commission or applicable stock exchange.

7. Tax Consequences. Participant agrees that the Company does not have a duty to design or administer the Plan or its other compensation programs in a manner that minimize the Participant’s tax liabilities. Participant will not make any claim against the Company, or any of its officers, directors, employees or Affiliates related to tax liabilities arising from the Option or the Participant’s other compensation.

8. Adjustments. In the event that the Committee shall determine that any dividend or other distribution (whether in the form of cash, shares, other securities or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase or exchange of shares or other securities of the Company, issuance of warrants or other rights to purchase shares or other securities of the Company or other similar corporate transaction or event affects the Shares covered by the Option such that an adjustment is necessary to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under this Agreement, then the Committee shall, in such manner as it may deem equitable, in its sole discretion, adjust any or all of the number and type of the Shares covered by the Option and the exercise price of the Option.

9. General Provisions.

(a) Interpretations. This Agreement is subject in all respects to the terms of the Plan. Terms used herein which are defined in the Plan shall have the respective meanings given to such terms in the Plan, unless otherwise defined herein. In the event that any provision of this Agreement is inconsistent with the terms of the Plan, the terms of the Plan shall govern. Any question of administration or interpretation arising under this Agreement shall be determined by the Committee, and such determination shall be final, conclusive and binding upon all parties in interest.

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(b) No Rights as a Shareholder. Neither Participant nor Participant’s legal representatives shall have any of the rights and privileges of a shareholder of the Company with respect to the Shares of Common Stock subject to the Option until such Shares shall have been issued upon exercise of the Option.

(c) No Right to Employment. Nothing in this Agreement or the Plan shall be construed as giving Participant the right to be retained as an employee of the Company or any Affiliate. In addition, the Company or an Affiliate may at any time dismiss Participant from employment, free from any liability or any claim under this Agreement, unless otherwise expressly provided in this Agreement or the Plan.

(d) Option Not Transferable. The Option shall not be transferable other than (i) by will or by the laws of descent and distribution, or (ii) by designating a beneficiary or beneficiaries (in a manner established by the Committee) to exercise the rights of the Participant and receive any property distributable with respect to any Option upon the death of the Participant. During Participant’s lifetime the Option shall be exercisable only by Participant or, if permissible under applicable law, by Participant’s guardian or legal representative. The Option may not be pledged, alienated, attached or otherwise encumbered, and any purported pledge, alienation, attachment or encumbrance of the Option shall be void and unenforceable against the Company.

(e) Reservation of Shares. The Company shall at all times during the term of the Option reserve and keep available such number of shares of Common Stock as will be sufficient to satisfy the requirements of this Agreement.

(f) Headings. Headings are given to the sections and subsections of this Agreement solely as a convenience to facilitate reference. Such headings shall not be deemed in any way material or relevant to the construction or interpretation of this Agreement or any provision hereof.

(g) Governing Law. The internal law, and not the law of conflicts, of the State of Minnesota will govern all questions concerning the validity, construction and effect of this Agreement.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement to be effective as of the date first set forth above.

	H.B. FULLER COMPANY


	By:




	Participant

	Date:

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EX-10.2 3 ex_110540.htm EXHIBIT 10.2 ex_110540.htm

Exhibit 10.2

FORM OF RESTRICTED STOCK UNIT AGREEMENT

H.B. FULLER COMPANY

RESTRICTED STOCK UNIT AWARD AGREEMENT
(Under the H.B. Fuller Company 2018 Master Incentive Plan)

THIS AGREEMENT, dated as of _______________, 20___ (the "Grant Date"), is entered into between H.B. Fuller Company, a Minnesota corporation (the “Company”), and ____________________, an employee of the Company or an affiliate of the Company (“Participant”).

WHEREAS, the Company, pursuant to the H.B. Fuller Company 2018 Master Incentive Plan (the “Plan”), wishes to award to Participant Restricted Stock Units, representing the right to receive shares (“Shares”) of common stock, par value $1.00 per share, of the Company (“Common Stock”), subject to certain restrictions and on the terms and conditions contained in this Agreement and the Plan;

WHEREAS, Participant’s rights to receive Shares of Common Stock hereunder are sometimes referred to as “Restricted Stock Units” in this Agreement.

NOW, THEREFORE, in consideration of the premises and agreements set forth herein, the parties hereto hereby agree as follows:

1. Award of Restricted Stock Units. The Company, as of the Grant Date, hereby grants to Participant an award of ______ Restricted Stock Units, each Restricted Stock Unit representing the right to receive one Share of Common Stock on such date as set forth herein, plus an additional amount pursuant to Section 2(b) hereof, subject to the terms and conditions set forth in this Agreement.

2. Rights of Participant with Respect to the Restricted Stock Units.

(a) No Shareholder Rights. The Restricted Stock Units granted pursuant to this Agreement do not and shall not entitle Participant to any rights of a shareholder of Common Stock. The rights of Participant with respect to the Restricted Stock Units shall remain forfeitable at all times prior to the date on which such rights become vested, and the restrictions with respect to the Restricted Stock Units lapse, in accordance with Section 3 hereof.

(b) Dividend Equivalents. As long as Participant holds Restricted Stock Units granted pursuant to this Agreement on the applicable record date, the Company shall credit to Participant, on each date that the Company pays a cash dividend to holders of Common Stock generally, an additional number of Restricted Stock Units (“Additional Restricted Stock Units”) equal to the total number of whole Restricted Stock Units and Additional Restricted Stock Units previously credited to Participant under this Agreement multiplied by the dollar amount of the cash dividend paid per Share of Common Stock by the Company on such date, divided by the Fair Market Value of a Share of Common Stock on such date. Any fractional Restricted Stock Unit resulting from such calculation shall be included in the Additional Restricted Stock Units. A report showing the number of Additional Restricted Stock Units so credited shall be sent to Participant periodically, as determined by the Company. The Additional Restricted Stock Units so credited shall be subject to the same terms and conditions as the Restricted Stock Units granted pursuant to this Agreement and the Additional Restricted Stock Units shall be forfeited in the event that the Restricted Stock Units with respect to which the dividend equivalents were credited are forfeited.

(c) Issuance of Shares; Conversion of Restricted Stock Units. No Shares of Common Stock shall be issued to Participant prior to the date on which the Restricted Stock Units vest, and the restrictions with respect to the Restricted Stock Units lapse, in accordance with Section 3 hereof. Neither this Section 2(c) nor any action taken pursuant to or in accordance with this Section 2(c) shall be construed to create a trust of any kind. After any Restricted Stock Units vest pursuant to Section 3 hereof, the Company shall promptly cause to be issued, in either certificated or uncertificated form, Shares of Common Stock registered in Participant’s name or in the name of Participant’s legal representatives, beneficiaries or heirs, as the case may be, in payment of such vested whole Restricted Stock Units and any Additional Restricted Stock Units and shall cause such certificated or uncertificated Shares to be delivered to Participant or Participant’s legal representatives, beneficiaries or heirs, as the case may be. In no event shall issuance of Shares occur more than ninety (90) days after the applicable vesting date. The value of any fractional Restricted Stock Unit shall be cancelled at the time certificated or uncertificated Shares are delivered to Participant in payment of the Restricted Stock Units and any Additional Restricted Stock Units.

3. Vesting; Forfeiture.

(a) Subject to the terms and conditions of this Agreement, the Restricted Stock Units shall vest in full in _______ annual installments and the restrictions with respect to the Restricted Stock Units shall lapse on the vesting dates (each, a “Vesting Date”) set forth below if Participant remains continuously employed by the Company or an Affiliate of the Company through the applicable Vesting Date:

Date		Percentage of Restricted Stock Units to Vest

____ anniversary of the Grant Date		__%
____ anniversary of the Grant Date		__%
____ anniversary of the Grant Date		__%
____ anniversary of the Grant Date		__%
____ anniversary of the Grant Date		__%

(b) Termination of Employment. In the event that Participant’s employment with the Company and all Affiliates is terminated prior to a Vesting Date, Participant’s right to receive any Shares (including the right to receive any Shares relating to Additional Restricted Stock Units) corresponding to that Vesting Date shall be immediately and irrevocably forfeited, unless such termination is by reason of:

(1)

Participant’s permanent disability (within the meaning of Section 409A(a)(2)(C)(i) of the Code);

(2)

Participant’s death; or

(3)

Participant’s retirement (as defined below in Section 3(d) below).

(c) Early Vesting on Death or Disability. In the event Participant dies or becomes permanently disabled prior to a Vesting Date, all unvested Restricted Stock Units then outstanding (and not previously forfeited) shall immediately vest, and Participant or Participant’s estate shall be entitled to receive a payment of all corresponding Shares of Common Stock. Such payment shall be made as soon as administratively feasible (but in no event more than ninety (90) days) following Participant’s death or permanent disability, as applicable.

(d) Retirement. In the event Participant retires prior to a Vesting Date, then Participant’s rights under this Agreement shall remain outstanding as if Participant had remained employed through the Vesting Date. For purposes of this Section 3, “retirement” shall mean the voluntary or involuntary termination of Participant’s employment for any reason other than gross and willful misconduct, disability or death, after Participant has completed at least ten years of service as an employee of the Company and/or an Affiliate of the Company, and has attained age 55, so long as the Participant has at all times that Restricted Stock Units are outstanding under this Agreement complied with the terms of any applicable confidentiality, non-disclosure and/or non-competition agreement between the Company and the Participant.

(e) Change in Control. Notwithstanding the foregoing provisions of this Agreement, in the event that a Change in Control (as defined below) occurs prior to a Vesting Date, all unvested Restricted Stock Units then outstanding (and not previously forfeited) shall immediately vest, and Participant shall be entitled to receive a payment of the Shares of Common Stock corresponding to such Vesting Date. Such payment shall be made promptly following the date of the Change in Control. For the purposes of this Agreement, a “Change in Control” shall be deemed to have occurred upon any of the following events:

(1)

a public announcement (which, for purposes hereof, shall include, without limitation, a report filed pursuant to Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that any individual, corporation, partnership, association, trust or other entity becomes the beneficial owner (as defined in Rule 13(d)(3) promulgated under the Exchange Act), directly or indirectly, of securities of the Company representing 30% or more of the voting power of the Company then outstanding;

(2)

the individuals who, as of the date of this Agreement, are members of 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 if the election or nomination for election by the Company’s shareholders of any new director was approved by a vote of at least a majority of the Incumbent Board, such new director shall be considered to be a member of the Incumbent Board);

(3)

the approval of the shareholders of the Company, and consummation, of (i) any consolidation, merger or statutory share exchange of the Company with any person in which the surviving entity would not have as its directors at least 60% of the Incumbent Board and as a result of which those persons who were shareholders of the Company immediately prior to such transaction would not hold, immediately after such transaction, at least 60% of the voting power of the Company then outstanding or the combined voting power of the surviving entity’s then outstanding voting securities; (ii) any sale, lease, exchange or other transfer in one transaction or series of related transactions substantially all of the assets of the Company; or (iii) the adoption of any plan or proposal for the complete or partial liquidation or dissolution of the Company; or

(4)

a determination by a majority of the members of the Incumbent Board, in their sole and absolute discretion, that there has been a Change in Control of the Company.

For purposes of this Section 3(e), “voting power” when used with reference to the Company shall mean the voting power of all classes and series of capital stock of the Company now or hereafter authorized.

Notwithstanding the foregoing, if any payment due under this Section 3(e) is deferred compensation subject to Section 409A of the Code, and if the Change in Control is not a “change in control event” that serves as a permissible payment event under Treasury Regulation § 1.409A-3(i)(5) or such other regulation or guidance issued under Section 409A of the Code, then the Shares of Common Stock shall vest upon the Change in Control as provided above but payment under this Section 3(e) shall be delayed until the earlier of (i) the applicable Vesting Date corresponding to the Shares or (ii) Participant’s separation from service (subject to any additional required delay under Section 9(a)).

(f) Forfeiture. If Participant ceases to be employed by the Company or an Affiliate of the Company for any reason other than “retirement” as defined below or Participant’s death as specified in Section 3(c) hereof, prior to the vesting of the Restricted Stock Units pursuant to Section 3(b) hereof, Participant’s rights to all of the unvested Restricted Stock Units shall be immediately and irrevocably forfeited, including the right to receive any Additional Restricted Stock Units.

For purposes of this Section 3, “retirement” shall mean the voluntary or involuntary termination of Participant’s employment for any reason other than gross and willful misconduct, disability or death, after the Participant has completed at least ten years of service as an employee of the Company and/or an Affiliate of the Company, and has attained age 55, so long as the Participant has at all times that Restricted Stock Units are outstanding under this Agreement complied with the terms of any applicable confidentiality, non-disclosure and/or non-competition agreement between the Company and the Participant. In all other cases, any unvested Restricted Stock Units and Additional Restricted Stock Units shall terminate upon retirement.

4. Restrictions on Transfer. The Restricted Stock Units shall not be transferable other than by will or by the laws of descent and distribution. Notwithstanding the foregoing, Participant may, in the manner established by the Committee, designate a beneficiary or beneficiaries to exercise the rights of Participant and receive any property distributable with respect to the Restricted Stock Units upon the death of Participant. Each right under this Agreement shall be exercisable during Participant’s lifetime only by Participant or, if permissible under applicable law, by Participant’s legal representative. The Restricted Stock Units and any rights under this Agreement may not be sold, assigned, transferred, pledged, alienated, attached or otherwise encumbered and any purported sale, assignment, transfer, pledge, alienation, attachment or encumbrance shall be void and unenforceable against the Company or any Affiliate.

5. Income Tax Matters. In order to comply with all applicable federal, foreign, state or local income tax laws or regulations, the Company may take such action as it deems appropriate to ensure that all applicable federal, foreign, state or local payroll, withholding, income or other taxes, which are the sole and absolute responsibility of Participant, are withheld or collected from Participant. Upon vesting of the Restricted Stock Units and the lapse of the restrictions with respect to the Restricted Stock Units under the terms of this Award Agreement, Participant shall be obligated to pay any applicable withholding taxes arising from such vesting and lapse of restrictions. Unless the Company receives an irrevocable written instruction, addressed to the attention of the Secretary of the Company, from Participant prior to the date that the Restricted Stock Units vest and the restrictions lapse, the Company shall automatically withhold as payment the number of Shares of Common Stock, determined by the Fair Market Value on the applicable vesting date as set forth in Section 3 and lapse of restrictions, required to pay the applicable withholding taxes (but only to the extent necessary to satisfy minimum statutory withholding requirements if required under ASC Topic 718).

6. Securities Matters. No Shares of Common Stock shall be issued pursuant to this Agreement prior to such time as counsel to the Company shall have determined that the issuance of such Shares will not violate any securities or other laws, rules or regulations. The Company shall not be required to deliver any Shares of Common Stock until the requirements of any applicable securities or other laws, rules or regulations (including the rules of any securities exchange) as may be determined by the Company to be applicable are satisfied. In addition, the grant of these Restricted Stock Units and/or the delivery of any Shares of Common Stock under this Agreement are subject to the Company’s Executive and Key Manager Compensation Clawback Policy and any other clawback policies the Company may adopt in the future to conform to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (or any other applicable law) and any applicable rules and regulations of the Securities and Exchange Commission or applicable stock exchange.

8. Adjustments. In the event that the Committee shall determine that any dividend or other distribution (whether in the form of cash, shares, other securities or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase or exchange of shares or other securities of the Company, issuance of warrants or other rights to purchase shares or other securities of the Company or other similar corporate transaction or event affects the Common Stock such that an adjustment is necessary in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under this Agreement, then the Committee shall, in such manner as it may deem equitable, in its sole discretion, adjust any or all of the number and type of shares subject to the Restricted Stock Units.

9. General Provisions.

(a) Section 409A. Notwithstanding the foregoing, to the extent that any payment due hereunder is (i) deferred compensation subject to Section 409A of the Code (“Section 409A”), and (ii) is payable to a specified employee (as that term is defined in Section 409A), and (iii) is payable on account of the specified employee’s separation from service (as that term is defined in Section 409A), payment of any part of such amount that would have been made during the six (6) months following the separation from service shall not then be paid but shall rather be paid on the first day of the seventh (7th) month following the separation from service.

(1)

For this purpose, specified employees shall be identified by the Company on a basis consistent with regulations issued under Section 409A, and consistently applied to all plans, programs, contracts, etc. maintained by the Company that are subject to Section 409A.

(2)

For this purpose, “termination of employment” shall be defined as “separation from service” as that term is defined under Section 409A.

(3)

To the extent that Section 409A is applicable to this Agreement, this Agreement shall be construed and administered to comply with the rules of Section 409A. Neither the Company nor any of its officers, directors, agents or affiliates shall be obligated, directly or indirectly, to any participant or any other person for any taxes, penalties, interest or like amounts that may be imposed on the participant or other person on account of any amounts under this Plan or on account of any failure to comply with any Code section.

(4)

The rules of section 409A of the Code shall apply to this Agreement, and this Agreement shall be construed and administered accordingly. Notwithstanding the foregoing, neither the Company nor any of its officers, directors, agents or affiliates shall be obligated, directly or indirectly, to any Participant or any other person for any taxes, penalties, interest or like amounts that may be imposed on the Participant or other person on account of any amounts under this Agreement or on account of any failure to comply with any section of the Code.

(b) Interpretations. This Agreement is subject in all respects to the terms of the Plan. Terms used herein which are defined in the Plan shall have the respective meanings ascribed to such terms in the Plan, unless otherwise defined herein. In the event that any provision of this Agreement is inconsistent with the terms of the Plan, the terms of the Plan shall govern. Any question of administration or interpretation arising under this Agreement shall be determined by the Committee, and such determination shall be final and conclusive upon all parties in interest.

(c) No Right to Employment. The grant of the Restricted Stock Units shall not be construed as giving Participant the right to be retained as an employee of the Company or any Affiliate. In addition, the Company or an Affiliate may at any time dismiss Participant from employment, free from any liability or any claim under this Agreement, unless otherwise expressly provided in this Agreement or the Plan.

(d) Headings. Headings are given to the sections and subsections of this Agreement solely as a convenience to facilitate reference. Such headings shall not be deemed in any way material or relevant to the construction or interpretation of this Agreement or any provision hereof.

(e) Severability. If any provision of this Agreement is or becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction under any law deemed to be applicable by the Committee, such provision shall be construed or deemed amended to conform to the applicable law, or if it cannot be so construed or amended without, in the determination of the Committee, materially altering the purpose or intent of this Agreement, such provision shall be stricken as to such jurisdiction or this Agreement, and the remainder of this Agreement shall remain in full force and effect.

(f) Governing Law. The internal law, and not the law of conflicts, of the State of Minnesota will govern all questions concerning the validity, construction and effect of this Agreement.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first set forth above.

	H.B. FULLER COMPANY


	By:




	Participant

	Date:

EX-10.3 4 ex_110541.htm EXHIBIT 10.3 ex_110541.htm

Exhibit 10.3

CEO FORM OF RESTRICTED STOCK UNIT AGREEMENT

H.B. FULLER COMPANY

RESTRICTED STOCK UNIT AWARD AGREEMENT
(Under the H.B. Fuller Company 2018 Master Incentive Plan)

THIS AGREEMENT, dated as of ________________, 20___ (the "Grant Date"), is entered into between H.B. Fuller Company, a Minnesota corporation (the “Company”), and ____________________, an employee of the Company or an affiliate of the Company (“Participant”).

WHEREAS, Participant’s rights to receive Shares of Common Stock hereunder are sometimes referred to as “Restricted Stock Units” in this Agreement.

NOW, THEREFORE, in consideration of the premises and agreements set forth herein, the parties hereto hereby agree as follows:

2. Rights of Participant with Respect to the Restricted Stock Units.

(b) Dividend Equivalents. As long as Participant holds Restricted Stock Units granted pursuant to this Agreement on the applicable record date, the Company shall credit to Participant, on each date that the Company pays a cash dividend to holders of Common Stock generally, an additional number of Restricted Stock Units (“Additional Restricted Stock Units”) equal to the total number of whole Restricted Stock Units and Additional Restricted Stock Units previously credited to Participant under this Agreement multiplied by the dollar amount of the cash dividend paid per share of Common Stock by the Company on such date, divided by the Fair Market Value of a share of Common Stock on such date. Any fractional Restricted Stock Unit resulting from such calculation shall be included in the Additional Restricted Stock Units. A report showing the number of Additional Restricted Stock Units so credited shall be sent to Participant periodically, as determined by the Company. The Additional Restricted Stock Units so credited shall be subject to the same terms and conditions as the Restricted Stock Units granted pursuant to this Agreement and the Additional Restricted Stock Units shall be forfeited in the event that the Restricted Stock Units with respect to which the dividend equivalents were credited are forfeited.

(c) Issuance of Shares; Conversion of Restricted Stock Units. No Shares of Common Stock shall be issued to Participant prior to the date on which the Restricted Stock Units vest, and the restrictions with respect to the Restricted Stock Units lapse, in accordance with Section 3 hereof. Neither this Section 2(c) nor any action taken pursuant to or in accordance with this Section 2(c) shall be construed to create a trust of any kind. After any Restricted Stock Units vest pursuant to Section 3 hereof, the Company shall promptly cause to be issued, in either certificated or uncertificated form, Shares of Common Stock registered in Participant’s name or in the name of Participant’s legal representatives, beneficiaries or heirs, as the case may be, in payment of such vested whole Restricted Stock Units and any Additional Restricted Stock Units and shall cause such certificated or uncertificated shares to be delivered to Participant or Participant’s legal representatives, beneficiaries or heirs, as the case may be. In no event shall issuance of Shares occur more than ninety (90) days after the applicable Vesting Date (as defined below). The value of any fractional Restricted Stock Unit shall be cancelled at the time certificated or uncertificated shares are delivered to Participant in payment of the Restricted Stock Units and any Additional Restricted Stock Units.

3. Vesting; Forfeiture.

(a) Vesting. Subject to the terms and conditions of this Agreement, in the event that any one or more of the performance measures for the Participant set forth under the Company’s Short-Term Incentive Program are met (at the threshold level or above) for the fiscal year ending ________________, 20__ (the “Performance Period”) as determined by the Compensation Committee of the Board of Directors of the Company, the Restricted Stock Units shall vest in full and the restrictions with respect to the Restricted Stock Units shall lapse if Participant remains continuously employed by the Company or an Affiliate of the Company until the date of such vesting (the “Vesting Date”) and lapse of restrictions, as set forth below:

Vesting Date		Percentage of Restricted Stock Units to Vest

_______ anniversary of the Grant Date		__%
_______ anniversary of the Grant Date		__%
_______ anniversary of the Grant Date		__%
_______ anniversary of the Grant Date		__%
_______ anniversary of the Grant Date		__%

In the event that any one or more of the performance measures set forth under the Company’s Short-Term Incentive Program are not met (at the threshold level or above) for the Performance Period, the Restricted Stock Units, Participant’s right to receive any Shares (including the right to receive any Shares relating to Additional Restricted Stock Units) shall be immediately and irrevocably forfeited at the end of the Performance Period.

(1)

Participant’s permanent disability (within the meaning of Section 409A(a)(2)(C)(i) of the Code);

(2)

Participant’s death; or

(3)

Participant’s retirement (as defined below in Section 3(d) below).

(d) Retirement. In the event Participant retires during the Performance Period or prior to a Vesting Date, then Participant’s rights under this Agreement shall remain outstanding as if Participant had remained employed for the duration of the Performance Period and through the Vesting Date. Participant shall be entitled to receive payment of the Shares, if any, that become payable under Section 1 based on actual performance achieved. For purposes of this Section 3, “retirement” shall mean the voluntary or involuntary termination of Participant’s employment for any reason other than gross and willful misconduct, disability or death, after Participant has completed at least ten years of service as an employee of the Company and/or an Affiliate of the Company, and has attained age 55, so long as the Participant has at all times that Restricted Stock Units are outstanding under this Agreement complied with the terms of any applicable confidentiality, non-disclosure and/or non-competition agreement between the Company and Participant.

(e) Change in Control. Notwithstanding the foregoing provisions of this Agreement, in the event that a Change in Control (as defined below) occurs prior to a Vesting Date, all unvested Restricted Stock Units then outstanding (and not previously forfeited) shall immediately vest, and Participant shall be entitled to receive a payment of all corresponding Shares of Common Stock. Such payment shall be made promptly following the date of the Change in Control. For the purposes of this Agreement, a “Change in Control” shall be deemed to have occurred upon any of the following events:

(1)

(2)

(3)

(4)

a determination by a majority of the members of the Incumbent Board, in their sole and absolute discretion, that there has been a Change in Control of the Company.

Notwithstanding the foregoing, if any payment due under this Section 3(e) is deferred compensation subject to Section 409A of the Code, and if the Change in Control is not a “change in control event” that serves as a permissible payment event under Treasury Regulation § 1.409A-3(i)(5) or such other regulation or guidance issued under Section 409A of the Code, then the Restricted Stock Units shall vest upon the Change in Control as provided above but payment under this Section 3(e) shall be delayed until the earlier of (i) the last day of the Performance Period or (ii) Participant’s separation from service (subject to any additional required delay under Section 9(a)).

8. Adjustments. In the event that the Committee shall determine that any dividend or other distribution (whether in the form of cash, shares, other securities or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase or exchange of shares or other securities of the Company, issuance of warrants or other rights to purchase shares or other securities of the Company or other similar corporate transaction or event affects the Common Stock such that an adjustment is necessary to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under this Agreement, then the Committee shall, in such manner as it may deem equitable, in its sole discretion, adjust any or all of the number and type of shares subject to the Restricted Stock Units.

9. General Provisions.

(1)

(2)

For this purpose, “termination of employment” shall be defined as “separation from service” as that term is defined under Section 409A.

(3)

(4)

The rules of Section 409A of the Code shall apply to this Agreement, and this Agreement shall be construed and administered accordingly. Notwithstanding the foregoing, neither the Company nor any of its officers, directors, agents or affiliates shall be obligated, directly or indirectly, to any Participant or any other person for any taxes, penalties, interest or like amounts that may be imposed on the Participant or other person on account of any amounts under this Agreement or on account of any failure to comply with any section of the Code.

(f) Governing Law. The internal law, and not the law of conflicts, of the State of Minnesota will govern all questions concerning the validity, construction and effect of this Agreement.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first set forth above.

	H.B. FULLER COMPANY


	By:




	Participant

	Date:

EX-10.4 5 ex_110553.htm EXHIBIT 10.4 ex_110553.htm

Exhibit 10.4

FORM OF PERFORMANCE SHARE AWARD AGREEMENT

H.B. FULLER COMPANY

PERFORMANCE SHARE AWARD AGREEMENT
(Under the H.B. Fuller Company 2018 Master Incentive Plan)

THIS AGREEMENT, dated as of ____________, 20__ (the "Grant Date"), is entered into between H.B. Fuller Company, a Minnesota corporation (the “Company”), and _____________, an employee of the Company or an affiliate of the Company (“Participant”).

WHEREAS, the Company, pursuant to the H.B. Fuller Company 2018 Master Incentive Plan (the “Plan”), wishes to award to Participant a Performance Share Award representing the right to receive shares (“Shares”) of common stock, par value $1.00 per share, of the Company (“Common Stock”), subject to certain restrictions and on the terms and conditions contained in this Performance Share Award Agreement and the Plan;

WHEREAS, Participant’s rights to receive Shares of Common Stock hereunder are sometimes referred to as “Restricted Stock Units” in this Agreement.

NOW, THEREFORE, in consideration of the premises and agreements set forth herein, the parties hereto hereby agree as follows:

1. Performance Share Award. The Company, effective as of the Grant Date, hereby grants to Participant a Performance Share Award representing the right to receive a specified number of Shares of Common Stock as set forth below and subject to the terms and conditions set forth in this Agreement and the Plan:

(a) ______ Target Number of Shares Subject to Award. The Target Number shall consist of three (3) tranches determined using the percentages set forth below (each, a Tranche Number). The number of Shares payable with respect to each tranche ranges from a maximum number of Shares equal to 200% of the Tranche Number to a potential for a -0- payout in the event the threshold level of performance for that tranche is not achieved (see Exhibit A).

(b) The Performance Periods and Tranche Vesting Dates for purposes of determining whether, and the extent to which, Shares of Common Stock within each tranche become payable hereunder shall be:

	Performance Period	Tranche	Tranche Vesting Date
a)	____________, 20__ – ___________, 20__	__%	_____ anniversary date of the Grant Date
b)	____________, 20__ –___________, 20__	__%	_____ anniversary date of the Grant Date
c)	____________, 20__ – ___________, 20__	__%	_____ anniversary date of the Grant Date

The performance goals for purposes of determining whether, and the extent to which, the Shares of Common Stock will be paid are set forth in Exhibit A to this Agreement, which Exhibit is made a part of this Agreement.

2. Rights of Participant with Respect to the Restricted Stock Units.

(b) Dividend Equivalents. As long as Participant holds Restricted Stock Units granted pursuant to this Agreement on the applicable record date, the Company shall credit to Participant, on each date that the Company pays a cash dividend to holders of Common Stock generally, an additional number of Restricted Stock Units (“Additional Restricted Stock Units”) equal to the total number of whole Restricted Stock Units and Additional Restricted Stock Units previously credited to Participant under this Agreement multiplied by the dollar amount of the cash dividend paid per share of Common Stock by the Company on such date, divided by the Fair Market Value of a share of Common Stock on such date. Any fractional Restricted Stock Unit resulting from such calculation shall be included in the Additional Restricted Stock Units. A report showing the number of Additional Restricted Stock Units so credited shall be sent to Participant periodically, as determined by the Company. The Additional Restricted Stock Units so credited shall be subject to the same terms and conditions as the Restricted Stock Units granted pursuant to this Agreement and the Additional Restricted Stock Units shall be forfeited in the event that the Restricted Stock Units with respect to which the dividend equivalents were credited are forfeited.

(c) Issuance of Shares; Conversion of Restricted Stock Units. No Shares of Common Stock shall be issued to Participant prior to the date on which the Restricted Stock Units vest, and the restrictions with respect to the Restricted Stock Units lapse, in accordance with Section 1 or Section 3 hereof. Neither this Section 2(c) nor any action taken pursuant to or in accordance with this Section 2(c) shall be construed to create a trust of any kind. After any Restricted Stock Units vest pursuant to Section 1 or Section 3 hereof, the Company shall promptly cause to be issued, in either certificated or uncertificated form, Shares of Common Stock registered in Participant’s name or in the name of Participant’s legal representatives, beneficiaries or heirs, as the case may be, in payment of such vested whole Restricted Stock Units and any Additional Restricted Stock Units and shall cause such certificated or uncertificated shares to be delivered to Participant or Participant’s legal representatives, beneficiaries or heirs, as the case may be. In no event shall issuance of Shares occur more than ninety (90) days after the applicable vesting date. The value of any fractional Restricted Stock Unit shall be cancelled at the time certificated or uncertificated shares are delivered to Participant in payment of the Restricted Stock Units and any Additional Restricted Stock Units.

3. Vesting; Forfeiture.

(a) Termination of Employment. In the event that Participant’s employment with the Company and all Affiliates is terminated prior to a Tranche Vesting Date, the Participant’s right to receive any Shares (including the right to receive any Shares relating to Additional Restricted Stock Units) corresponding to that Tranche Vesting Date shall be immediately and irrevocably forfeited, unless such termination is by reason of:

(1)

Participant’s permanent disability (within the meaning of Section 409A(a)(2)(C)(i) of the Code);

(2)

Participant’s death; or

(3)

Participant’s retirement (as defined below in Section 3(c) below).

(b) Early Vesting on Death or Disability. In the event Participant dies or becomes permanently disabled prior to the commencement or completion of a Performance Period, or after completion of a Performance Period but prior to a Tranche Vesting Date, then Participant or Participant’s estate shall be entitled to receive a payment of the Shares of Common Stock corresponding to such Performance Period based on, and assuming that, performance would be achieved at the target level, as set forth in Exhibit A to this Agreement. Such payment shall be made as soon as administratively feasible (but in no event more than ninety (90) days) following Participant’s death or permanent disability, as applicable. If a payment is made pursuant to this Section 3(b), no payment shall be made pursuant to Section 1 of this Agreement.

(c) Retirement. In the event Participant retires prior to the commencement or completion of a Performance Period or prior to a Tranche Vesting Date, then Participant’s rights under the Performance Award shall remain outstanding as if Participant had remained employed for the duration of the Performance Period and through the Tranche Vesting Date. Participant shall be entitled to receive payment of the Performance Award, if any, that becomes payable under Section 1 based on actual performance achieved. For purposes of this Section 3, “retirement” shall mean the voluntary or involuntary termination of Participant’s employment for any reason other than gross and willful misconduct, disability or death, after Participant has completed at least ten years of service as an employee of the Company and/or an Affiliate of the Company, and has attained age 55, so long as the Participant has at all times that Restricted Stock Units are outstanding under this Agreement complied with the terms of any applicable confidentiality, non-disclosure and/or non-competition agreement between the Company and the Participant.

(d) Change in Control. Notwithstanding the foregoing provisions of this Agreement, in the event that a Change in Control (as defined below) occurs prior to a Tranche Vesting Date, Participant shall be entitled to receive a payment of the Shares of Common Stock corresponding to the Performance Period relating to such Tranche Vesting Date based on, and assuming that, performance would have been achieved at the target level, as set forth in Exhibit A to this Agreement. Such payment shall be made promptly following the date of the Change in Control. For the purposes of this Agreement, a “Change in Control” shall be deemed to have occurred upon any of the following events:

(1)

(2)

(3)

(4)

a determination by a majority of the members of the Incumbent Board, in their sole and absolute discretion, that there has been a Change in Control of the Company.

For purposes of this Section 3(d), “voting power” when used with reference to the Company shall mean the voting power of all classes and series of capital stock of the Company now or hereafter authorized.

If a payment is made pursuant to this Section 3(d), no payment shall be made pursuant to Section 1 of this Agreement. Notwithstanding the foregoing, if any payment due under this Section 3(d) is deferred compensation subject to Section 409A of the Code, and if the Change in Control is not a “change in control event” that serves as a permissible payment event under Treasury Regulation § 1.409A-3(i)(5) or such other regulation or guidance issued under Section 409A of the Code, then the Performance Award shall vest upon the Change in Control as provided above but payment under this Section 3(d) shall be delayed until the earlier of (i) the last day of the Performance Period or (ii) Participant’s separation from service (subject to any additional required delay under Section 9(a)).

6. Securities Matters. No Shares of Common Stock shall be issued pursuant to this Agreement prior to such time as counsel to the Company shall have determined that the issuance of such shares will not violate any securities or other laws, rules or regulations. The Company shall not be required to deliver any Shares of Common Stock until the requirements of any applicable securities or other laws, rules or regulations (including the rules of any securities exchange) as may be determined by the Company to be applicable are satisfied. In addition, the grant of these Restricted Stock Units and/or the delivery of any Shares of Common Stock under this Agreement are subject to the Company’s Executive and Key Manager Compensation Clawback Policy and any other clawback policies the Company may adopt in the future to conform to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (or any other applicable law) and any applicable rules and regulations of the Securities and Exchange Commission or applicable stock exchange.

8. Adjustments. In the event that the Committee shall determine that any dividend or other distribution (whether in the form of cash, shares, other securities or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase or exchange of shares or other securities of the Company, issuance of warrants or other rights to purchase shares or other securities of the Company or other similar corporate transaction or event affects the Common Stock such that an adjustment is necessary in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under this Agreement, then the Committee shall, in such manner as it may deem equitable, in its sole discretion, adjust any or all of the number and type of shares subject to the Restricted Stock Units.

9. General Provisions.

(1)

(2)

For this purpose, “termination of employment” shall be defined as “separation from service” as that term is defined under Section 409A.

(3)

(4)

(f) Governing Law. The internal law, and not the law of conflicts, of the State of Minnesota will govern all questions concerning the validity, construction and effect of this Agreement.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first set forth above.

	H.B. FULLER COMPANY
	By:





	Participant

	Date:

Exhibit A

Performance Goals for Consecutive One-Year Performance Periods
_____________, 20__ – ____________, 20__: ____%
_____________, 20__ – ____________, 20__: ____%
_____________, 20__ – ____________, 20__: ____%

ROIC Performance	Payout (as % of Target)
Target + 4% [Superior]	200%
Target + 3%	175%
Target + 2%	150%
Target + 1%	125%
Target	100%
Target - 1%	75%
Target - 2% [Threshold]	50%
Less than threshold	0%

Performance between threshold and target and target and superior will be calculated on a pro rata basis. The level of achievement of each performance goal shall be determined by the Compensation Committee of the Board of Directors of the Company.

Definition of ROIC:

NOPAT¹

(Short-Term Debt + Long-Term Debt + Total Equity - Cash)²

•

Acquisitions will be treated as follows:

•

Year 1: remove acquisition from measurement completely

•

Year 2: remove amortization from the calculation

•

Year 3: no adjustments

¹ NOPAT = (Gross Profit – SG&A Expense) * (1-Effective Tax Rate) + Income from Equity Investments

Includes adjustments as publicly disclosed in the Company’s quarterly earnings release.

Effective tax rate defined as (Adjusted Tax Expense / Adjusted Pretax Earnings)

² End-of-year metrics. Denominator also includes redeemable non-controlling interest

EX-10.5 6 ex_110554.htm EXHIBIT 10.5 ex_110554.htm

Exhibit 10.5

FORM OF RESTRICTED STOCK UNIT AGREEMENT

FOR NON-EMPLOYEE DIRECTORS

H.B. FULLER COMPANY

RESTRICTED STOCK UNIT AWARD AGREEMENT
(Under the H.B. Fuller Company 2018 Master Incentive Plan)

THIS AGREEMENT, dated as of _______________, 20___, is entered into between H.B. Fuller Company, a Minnesota corporation (the “Company”), and ____________________, a non-employee director of the Company (“Participant”).

WHEREAS, the Company, pursuant to the H.B. Fuller Company 2018 Master Incentive Plan (the “Plan”), wishes to award to Participant Restricted Stock Units, representing the right to receive shares of common stock, par value $1.00 per share, of the Company (“Common Stock”), subject to certain restrictions and on the terms and conditions contained in this Agreement and the Plan;

WHEREAS, Participant’s rights to receive Shares of Common Stock hereunder are sometimes referred to as “Restricted Stock Units” in this Agreement.

NOW, THEREFORE, in consideration of the premises and agreements set forth herein, the parties hereto hereby agree as follows:

1. Award of Restricted Stock Units. The Company, effective as of the date of this Agreement, hereby grants to Participant an award of ______ Restricted Stock Units, each Restricted Stock Unit representing the right to receive one share of Common Stock on such date as set forth herein, plus an additional amount pursuant to Section 2(b) hereof, subject to the terms and conditions set forth in this Agreement.

2. Rights of Participant with Respect to the Restricted Stock Units.

(b) Dividend Equivalents. As long as Participant holds Restricted Stock Units granted pursuant to this Agreement on the applicable record date, the Company shall credit to Participant, on each date that the Company pays a cash dividend to holders of Common Stock generally, an additional number of Restricted Stock Units (“Additional Restricted Stock Units”) equal to the total number of whole Restricted Stock Units and Additional Restricted Stock Units previously credited to Participant under this Agreement multiplied by the dollar amount of the cash dividend paid per share of Common Stock by the Company on such date, divided by the Fair Market Value of a share of Common Stock on such date. Any fractional Restricted Stock Unit resulting from such calculation shall be included in the Additional Restricted Stock Units. A report showing the number of Additional Restricted Stock Units so credited shall be sent to Participant periodically, as determined by the Company. The Additional Restricted Stock Units so credited shall be subject to the same terms and conditions as the Restricted Stock Units granted pursuant to this Agreement and the Additional Restricted Stock Units shall be forfeited in the event that the Restricted Stock Units with respect to which the dividend equivalents were credited are forfeited.

(c) Issuance of Shares; Conversion of Restricted Stock Units. No shares of Common Stock shall be issued to Participant prior to the date on which the Restricted Stock Units vest, and the restrictions with respect to the Restricted Stock Units lapse, in accordance with Section 3 hereof. Neither this Section 2(c) nor any action taken pursuant to or in accordance with this Section 2(c) shall be construed to create a trust of any kind. After any Restricted Stock Units vest pursuant to Section 3 hereof, the Company shall promptly cause to be issued, in either certificated or uncertificated form, shares of Common Stock registered in Participant’s name or in the name of Participant’s legal representatives, beneficiaries or heirs, as the case may be, in payment of such vested whole Restricted Stock Units and any Additional Restricted Stock Units and shall cause such certificated or uncertificated shares to be delivered to Participant or Participant’s legal representatives, beneficiaries or heirs, as the case may be. In no event shall issuance of shares occur more than ninety (90) days after the applicable vesting date. The value of any fractional Restricted Stock Unit shall be cancelled at the time certificated or uncertificated shares are delivered to Participant in payment of the Restricted Stock Units and any Additional Restricted Stock Units.

3. Vesting; Forfeiture.

(a) Vesting. Subject to the terms and conditions of this Agreement, the Restricted Stock Units shall vest in full, and the restrictions with respect to the Restricted Stock Units shall lapse, on the earlier of (i) _____________, or (ii) the date on which the director reaches the mandatory retirement age under the Company’s policy with respect to directors’ retirement from the Board of Directors, provided, in each case, that Participant continuously serves as a director of the Company until the earliest of such dates.

(b) Early Vesting. Notwithstanding the vesting provision contained in Section 3(a) above, but subject to the other terms and conditions set forth herein, upon the occurrence of a “Change in Control” (as defined below) or in the event of Participant’s death or permanent disability (within the meaning of Section 409A(a)(2)(C)(i) of the Code), Participant or Participant’s legal representatives, beneficiaries or heirs, as the case may be, shall become immediately vested in all of the Restricted Stock Units, and the restrictions with respect to the Restricted Stock Units shall lapse, as of the date of such Change in Control, death or permanent disability. Issuance of the shares shall be made as soon as administratively feasible (but in no event more than ninety (90) days) following Participant’s death or permanent disability, as applicable. Such payment shall be made promptly following the date of the Change in Control.

(c) Change in Control. For the purposes of this Agreement, a “Change in Control” shall be deemed to have occurred upon any of the following events:

(1)

(2)

(3)

(4)

a determination by a majority of the members of the Incumbent Board, in their sole and absolute discretion, that there has been a Change in Control of the Company.

For purposes of this Section 3(c), “voting power” when used with reference to the Company shall mean the voting power of all classes and series of capital stock of the Company now or hereafter authorized.

(d) Forfeiture. If Participant ceases to serve as a director of the Company for any reason other than those set forth in Section 3(b) hereof prior to the vesting of the Restricted Stock Units pursuant to Section 3(b) hereof, Participant’s rights to all of the unvested Restricted Stock Units shall be immediately and irrevocably forfeited, including the right to receive any Additional Restricted Stock Units.

5. Income Tax Matters. Participant understands and agrees that the Company has not advised Participant regarding Participant's income tax liability in connection with the grant of Restricted Stock Units pursuant to this Agreement. Participant further understands and agrees that he or she is responsible for consulting his or her own tax counsel on questions regarding his or her tax liability in connection with the grant of the Shares and upon the vesting of the Shares and any subsequent disposition of the Shares, and that Participant is solely responsible for such tax liability.

6. Securities Matters. No shares of Common Stock shall be issued pursuant to this Agreement prior to such time as counsel to the Company shall have determined that the issuance of such shares will not violate any securities or other laws, rules or regulations. The Company shall not be required to deliver any shares of Common Stock until the requirements of any applicable securities or other laws, rules or regulations (including the rules of any securities exchange) as may be determined by the Company to be applicable are satisfied. In addition, the grant of these Restricted Stock Units and/or the delivery of any shares of Common Stock under this Agreement are subject to the Company’s Executive and Key Manager Compensation Clawback Policy and any other clawback policies the Company may adopt in the future to conform to the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (or any other applicable law) and any applicable rules and regulations of the Securities and Exchange Commission or applicable stock exchange.

7. Tax Consequences. Participant agrees that the Company does not have a duty to design or administer the Plan or its other compensation programs in a manner that minimize the Participant’s tax liabilities. Participant will not make any claim against the Company, or any of its officers, directors, employees or affiliates related to tax liabilities arising from the Restricted Stock Units or the Participant’s other compensation.

8. Adjustments. In the event that the Committee shall determine that any dividend or other distribution (whether in the form of cash, shares, other securities or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase or exchange of shares or other securities of the Company, issuance of warrants or other rights to purchase shares or other securities of the Company or other similar corporate transaction or event affects the Common Stock such that an adjustment is necessary in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under this Agreement, then the Committee shall, in such manner as it may deem equitable, in its sole discretion, adjust any or all of the number and type of shares subject to the Restricted Stock Units.

9. General Provisions.

(a) Interpretations. This Agreement is subject in all respects to the terms of the Plan. Terms used herein which are defined in the Plan shall have the respective meanings ascribed to such terms in the Plan, unless otherwise defined herein. In the event that any provision of this Agreement is inconsistent with the terms of the Plan, the terms of the Plan shall govern. Any question of administration or interpretation arising under this Agreement shall be determined by the Committee, and such determination shall be final and conclusive upon all parties in interest.

(b) Headings. Headings are given to the sections and subsections of this Agreement solely as a convenience to facilitate reference. Such headings shall not be deemed in any way material or relevant to the construction or interpretation of this Agreement or any provision hereof.

(c) Severability. If any provision of this Agreement is or becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction under any law deemed to be applicable by the Committee, such provision shall be construed or deemed amended to conform to the applicable law, or if it cannot be so construed or amended without, in the determination of the Committee, materially altering the purpose or intent of this Agreement, such provision shall be stricken as to such jurisdiction or this Agreement, and the remainder of this Agreement shall remain in full force and effect.

(d) Governing Law. The internal law, and not the law of conflicts, of the State of Minnesota will govern all questions concerning the validity, construction and effect of this Agreement.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first set forth above.

	H.B. FULLER COMPANY


	By:



	Participant

	Date: