iPass Inc. Performance Shares Grant Notice (2003 Equity Incentive Plan)

Exhibit 10.3

iPass Inc. (the “ Company ”), pursuant to Section 7(b) of the Company’s 2003 Equity Incentive Plan (the “ Plan ”), hereby grants to Participant the number of shares of phantom stock (the “ Performance Shares ”) set forth below (the “ Award ”). This Award shall be evidenced by a Performance Shares Award Agreement (the “ Award Agreement ”). This Award is subject to all of the terms and conditions as set forth herein and in the applicable Award Agreement and the Plan, each of which are attached hereto and incorporated herein in their entirety.

Participant:    

Date of Grant:    

Number of Performance Shares:    

Payment for Common Stock:    

Vesting Schedule : [Initially, the Performance Shares shall be unearned and unvested. The Performance Shares shall be earned upon [vesting performance metrics for the particular grant to be inserted here]; provided, however , that the Participant’s Continuous Service has not terminated prior to each such vesting date. If the Performance Shares vest on a day that does not occur during a “window period,” vesting may be delayed as provided in Section 2 of the Award Agreement. The foregoing notwithstanding, if within eighteen (18) months following the closing of a “Corporate Transaction,” (i) the Participant’s employment by the Company, or an affiliate of the Company, is terminated by the Company without “Cause” or (ii) if the Participant resigns his or her employment for “Good Reason”, then all of the Participant’s then outstanding unvested Performance Shares shall vest in full upon the date of such termination. ]

Delivery Schedule : Delivery of one share of Common Stock for each Performance Share which vests shall be made on the applicable vesting date.

Additional Terms/Acknowledgements: Participant acknowledges receipt of, and understands and agrees to, this Grant Notice, the Award Agreement, and the Plan. Participant further acknowledges that as of the Date of Grant, this Grant Notice, the Award Agreement and the Plan set forth the entire understanding between Participant and the Company regarding the award of the Performance Shares and the underlying Common Stock and supersede all prior oral and written agreements on that subject with the exception of Awards previously granted and delivered to Participant under the Plan.

Attachments :   Award Agreement, and 2003 Equity Incentive Plan

Definitions:

For the purposes of the Performance Shares:

“Cause” shall mean the occurrence of any of the following (and only the following): (i) conviction of the terminated Participant of any felony involving fraud or act of dishonesty against the Company or its parent corporation or subsidiary corporation (whether now or hereafter existing, as those terms are defined in Sections 424(e) and (f), respectively, of the Internal Revenue Code (“Affiliates”)); (ii) conduct by the terminated Participant which, based upon good faith and reasonable factual investigation and determination of the Board of Directors of the Company, demonstrates gross unfitness to serve; or (iii) intentional, material violation by the terminated Participant of any statutory or fiduciary duty of the terminated Participant to the Company or its Affiliates;

“Corporate Transaction” shall mean (i) the sale of all or substantially all of the assets of the Company or (ii) a merger of the Company with or into another entity in which the stockholders of the Company immediately prior to the closing of the transaction own less than a majority of the ownership interest of the Company immediately following such closing. For purposes of determining whether the stockholders of the Company prior to the occurrence of a transaction described above own less than fifty percent (50%) of the voting securities of the relevant entity afterwards, only the lesser of the voting power held by a person either before or after the transaction shall be counted in determining that person’s ownership afterwards; and

“Good Reason” shall mean resignation by the Participant of his or her employment because (i) the Company requires that such Participant relocate to a worksite that is more than 60 miles from its current principal executive office, unless such Participant agrees in writing to such relocation; or (ii) the Company reduces the Participant’s monthly salary below the gross rate of the then-existing rate at the time of the closing of the Corporate Transaction, unless the Participant agrees in writing to such reduction.

Pursuant to the Performance Shares Grant Notice (“ Grant Notice ”), this Performance Shares Award Agreement (“ Agreement ”), and Section 7(b) of the Company’s 2003 Equity Incentive Plan (the “ Plan ”), iPass Inc. (the “ Company ”) has awarded you the number of shares of phantom stock (the “ Performance Shares ”) indicated in the Grant Notice (collectively, the “ Award ”). Defined terms not explicitly defined in this Agreement but defined in the Plan shall have the same definitions as in the Plan. Subject to adjustment and the terms and conditions as provided herein and in the Plan, each Performance Share shall represent the right to receive one (1) share of Common Stock.

The details of your Award, in addition to those set forth in the Grant Notice, are as follows.

1.    Number of Performance Shares and Shares of Common Stock. The number of Performance Shares in your Award is set forth in the Grant Notice.

(a)    The number of Performance Shares subject to your Award and the number of shares of Common Stock deliverable with respect to such Performance Shares may be adjusted from time to time for capitalization adjustments as described in Section 11(a) of the Plan. You shall receive no benefit or adjustment to your Award with respect to any cash dividend or other distribution that does not result in a capitalization adjustment pursuant to Section 11(a) of the Plan; provided, however, that this sentence shall not apply with respect to any shares of Common Stock that are delivered to you in connection with your Award after such shares have been delivered to you.

(b)    Any additional Performance Shares, shares of Common Stock, cash or other property that becomes subject to the Award pursuant to this Section 1 shall be subject, in a manner determined by the Board, to the same forfeiture restrictions, restrictions on transferability, and time and manner of delivery as applicable to the other Performance Shares and Common Stock covered by your Award.

(c)    Notwithstanding the provisions of this Section 1, no fractional Performance Shares or rights for fractional shares of Common Stock shall be created pursuant to this Section 1. The Board shall, in its discretion, determine an equivalent benefit for any fractional Performance Shares or fractional shares that might be created by the adjustments referred to in this Section 1.

2.    Vesting .

(a)    The Performance Shares shall vest, if at all, as provided in the Vesting Schedule set forth in your Grant Notice, provided that vesting shall cease upon the termination of your Continuous Service. Notwithstanding the foregoing, in the event that you are subject to the Company’s Stock Trading By Officers, Directors, and Access Employees policy (or any successor policy) and any shares covered by your Award vest on a day (the “ Original Vest Date ”) that does not occur during a “window period” applicable to you as determined by the Company in accordance with such policy, then such shares shall not vest on such Original Vest Date and shall instead vest on the earliest to occur of the following: (i) the first day of the next “window period” applicable to you pursuant to such policy; (ii) your Involuntary Termination Without Cause (as defined in Section 2(b) below) after the Original Vest Date; or (iii) the day that is sixty (60) days afte