RESTRICTED STOCK
AGREEMENT
THIS RESTRICTED
STOCK AGREEMENT (this “Agreement” ) is made and
entered into by and between Encysive Pharmaceuticals Inc., a
Delaware corporation (the “Company” ) and
Stephen L. Mueller, an individual ( “Grantee” )
on the 8th day of December, 2005, (the “Grant
Date” ), pursuant to the Encysive Pharmaceuticals Inc.
Amended and Restated 1999 Stock Incentive Plan (the
“Plan” ). The Plan is incorporated by reference
herein in its entirety. Capitalized terms not otherwise defined in
this agreement shall have the meaning given to such terms in the
Plan.
WHEREAS, Grantee
is an employee of the Company, and in connection therewith, the
Company desires to grant to Grantee 17,810 shares of the
Company’s common stock, par value $.005 per share (the
“Common Stock” ), subject to the terms and
conditions of this Agreement, with a view to increasing
Grantee’s interest in the Company’s welfare and growth;
and
WHEREAS, Grantee
desires to have the opportunity to be a holder of shares of the
Company’s Common Stock subject to the terms and conditions of
this Agreement.
NOW, THEREFORE, in
consideration of the premises, mutual covenants and agreements
contained herein, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the
parties hereto, intending to be legally bound hereby, agree as
follows:
1. Grant
of Common Stock . Subject to the restrictions, forfeiture
provisions and other terms and conditions set forth herein
(i) the Company grants to Grantee seventeen thousand eight
hundred ten (17,810) shares of Common Stock ( “Grant
Shares” ), and (ii) Grantee shall have and may
exercise all rights and privileges of ownership of such shares,
including, without limitation, the voting rights of such shares and
the right to receive any dividends declared in respect thereof. The
Company may require Grantee to reimburse the Company for, or the
Company may withhold from any amounts which it may owe Grantee, all
amounts required by applicable federal, state and local law in
respect of the issuance or vesting of the Grant Shares.
2. Transfer Restrictions .
(a)
Generally . Grantee shall not sell, assign, transfer,
exchange, pledge, encumber, gift, devise, hypothecate or otherwise
dispose of (collectively, “Transfer” ) any Grant
Shares. [The transfer restrictions imposed by this
Section 2 shall lapse as to approximately fifty percent
(50%) of the Grant Shares on each anniversary of November 30,
2007, and November 30, 2008, until all Grant Shares are fully
vested in two (2) years; provided, however , that,
subject to Section 3 , Grantee then is, and
continuously since the Grant Date has been, an employee of the
Company.] The Grant Shares as to which such restrictions so lapse
are referred to as “Vested Shares.”
(b)
Dividends, etc. If the Company (i) declares a dividend
or makes a distribution on Common Stock in shares of Common Stock,
(ii) subdivides or reclassifies outstanding shares of Common
Stock into a greater number of shares of Common Stock or
(iii) combines or reclassifies
outstanding
shares of Common Stock into a smaller number of shares of Common
Stock, then the number of shares of Grantee’s Common Stock
subject to the transfer restrictions of this Section 2 shall
be proportionately increased or reduced so as to prevent the
enlargement or dilution of Grantee’s rights and duties
hereunder. The determination of the Company’s Board of
Directors regarding such adjustments shall be final and
binding.
(c)
Extraordinary Transactions . If there is a Change in Control
of the Company (as defined in the Plan), the transfer restrictions
of this Section 2 shall automatically cease as of the
effective date of such Change in Control, and all the Grant Shares
shall thereafter be 100 percent (100%) vested.
(a)
Termination of Employment . Except as otherwise provided for
herein, if Grantee’s employment with the Company is
terminated by the Company or Grantee for any reason, then Grantee
shall immediately forfeit all Grant Shares which are not Vested
Shares unless the Committee, in its discretion, determines that any
or all of such Grant Shares shall not be so forfeited; provided,
however, that if the employment of the Grantee is terminated by the
Company for Good Cause (as defined below) or by the Grantee for
Good Reason (as defined below), then during the 12-month period
after the date of termination for Good Reason or Without Cause, all
Grant Shares which are not Vested Shares shall continue to vest in
accordance with the terms hereof during said 12-month period, and
at the conclusion of said 12-month period, all Grant Shares which
are not Vested Shares wi
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