SHARPS COMPLIANCE
CORP.
RESTRICTED STOCK AWARD
AGREEMENT
THIS AGREEMENT
is made as of this 27th day of October 2008, by and between Sharps
Compliance Corp., a Delaware corporation (the
“Company”), and John R. Grow
(“Grow”).
The Company, in
conjunction with the execution of the Employment Agreement
effective October 27, 2008, hereby grants the following stock award
to Grow, which award shall have the terms and conditions set forth
in this Agreement:
The Company,
effective as of the date of this Agreement, hereby grants to Grow a
restricted stock award of 300,000 unregistered shares (the
“Shares”) of common stock, par value $.01 per share, of
the Company (the “Common Stock”), subject to the terms
and conditions set forth herein. This award is not granted under
the Company’s 1993 Stock Plan and the corresponding shares
have not been registered with the Securities and Exchange
Commission.
Subject to the
terms and condition of this Agreement, the Shares shall vest as
follows: 50,000 of the Shares shall vest on March 1, 2009 and
12,500 of the Shares shall vest on the 1 st day of each
month for twenty (20) months beginning April 2009, if, and only if,
Grow remains an employee of the Company from the date hereof until
each respective vesting date. Vesting of the Shares shall be
accelerated to an earlier date in the event of a Change in Control
of Company (as defined in the attached Exhibit A), and provided
that Grow remains as an employee of the Company until the effective
date of such Change in Control; all unvested Shares granted under
this Agreement shall become immediately vested on the effective
date of the Change in Control;
3.
Restriction on Transfer
Until the
Shares vest pursuant to Section 2 hereof, none of the Shares may be
sold, assigned, transferred, pledged, hypothecated or otherwise
disposed of or encumbered, and no attempt to transfer the Shares,
whether voluntary or involuntary, by operation of law or otherwise,
shall vest the transferee with any interest or right in or with
respect to the Shares.
If Grow ceases
to be an employee of the Company prior to the vesting of the Shares
pursuant to Section 2 hereof, Grow’s rights to the unvested
portion of the Shares shall be immediately and irrevocably
forfeited.
5.
Issuance and Custody of Certificate
After any
Shares vest pursuant to Section 2 hereof, the Company shall cause
to be issued a certificate or certificates evidencing such vested
Shares, with such certificates including an appropriate legend,
determined by the Company’s transfer agent, reflecting the
unregistered and restricted nature of such shares.
6.
Distributions and Adjustments
(a) If
all or any portion of the Shares vest subsequent to any change in
the number or character of Shares of Common Stock (through stock
dividend, recapitalization, stock split, reverse stock split,
reorganization, merger, consolidation, split-up, spin-off,
combination, repurchase or exchange of Shares of Common Stock or
other securities of the Company, issuance of warrants or other
rights to purchase Shares of Common Stock or other securities of
the Company or other similar corporate transaction or event
affecting the Shares such that an adjustment is determined by the
Compensation Committee of the Board of Directors (the
“Committee”) to be appropriate in order to prevent
dilution or enlargement of the interest represented by the Share,
Grow shall then receive upon such vesting the number and type of
securities or other consideration which he would have received if
the Shares had vested prior to the event changing the number or
character of outstanding Shares of Common Stock.
(b) Any
additional Shares of Common Stock, any other securities of the
Company and any other property (except for cash dividends)
distributed with respect to the Shares prior to the date the Shares
vest shall be subject to the same restrictions, terms and
conditions as the Shares. Any cash dividends payable with
respect to the Shares shall be distributed to Grow at the same time
cash dividends are distribut
