STOCK RESTRICTION AGREEMENT
AGREEMENT made this th day of (the “Grant Date”) between Soapstone Networks Inc., a Delaware corporation (the “Company”), and (the “Employee”) (the “Agreement”).
The Employee has been granted shares (the “Shares”) of the Common Stock, $.0001 par value per share (the “Common Stock”), of the Company pursuant to the Company’s 2008 Global Stock Plan, as amended, (the “Plan”) in consideration of $ per share and subject to the terms and conditions of this Agreement.
The Company wishes to continue to retain the Employee as an employee of the Company and the Employee wishes to continue to be retained by the Company.
In consideration of the mutual covenants contained herein and for other valuable consideration, receipt of which is hereby acknowledged, the parties hereto agree as follows:
1. Grant . Subject to the terms and conditions of the Plan , the Company hereby grants and issues to the Employee _____ shares of Common Stock (the “Shares”) in consideration of the payment to the Company of an amount equal to $____ per share. The Shares granted pursuant to the Plan shall be subject to forfeiture, if, in the discretion of the Board of Directors (the “Board”) or any one or more committees or subcommittees of the Board authorized under the Plan to administer the Plan (a “Committee”), the Employee has not, within a reasonable period of time following the grant of the Shares, executed any instrument required by the Board or a Committee to be executed in connection with such grant. The Shares will be evidenced by this Agreement and the Employee will not receive a stock certificate for the Shares. The Employee will have his or her ownership of the Shares registered only in book-entry form in the records of the transfer agent for the Company’s Common Stock. Book-entry registration refers to a method of recording stock ownership in which no share certificates are issued to stockholders. Any inconsistency between this Agreement and the Plan shall be governed by the Plan.
2. Vesting of Shares if Business Relationship Continues .
(a) If the Employee has continued to serve the Company or any parent or subsidiary of the Company (a “Related Corporation”) in the capacity of an employee, officer, director or consultant (such service is described herein as maintaining or being involved in a “Business Relationship” with the Company or any Related Corporation) on any of the following dates, the Shares granted to the Employee shall vest as indicated below:
[On [date], [ ] of the Shares shall vest.] [May have multiple vesting dates and portions of Shares subject to vesting]
[If [goal] is achieved by [date], then upon the Committee’s determination in accordance with Section 2(b) below, the transfer and forfeiture restrictions with respect to [ ] of the Shares shall lapse and such Shares shall vest.] [May have multiple goals and dates and portions of Shares subject to vesting]
[On [date] (the “Vesting Date”), the shares that have not already vested pursuant to this Section 2(a) shall vest.
Notwithstanding the foregoing, all Shares shall vest, if not otherwise vested, on the anniversary of the Grant Date, subject to the terms and conditions of this Agreement. [In addition, on the occurrence and consummation of an “Acquisition” (as defined and used in the Plan) prior to the anniversary of the Grant
Date, [the Shares shall vest or such other appropriate provision made in accordance with the Plan as determined by the Committee][ additional Shares shall vest, if not otherwise vested, subject to the terms and conditions of this Agreement.]]
(b) Following the date the Employee ceases to maintain a Business Relationship with the Company or any Related Corporation, no unvested Shares shall become vested Shares with respect to the Employee, unless otherwise approved by the Board or its Committee. Any determination under this Agreement as to employment status or other matters relating to the exercise of this option or otherwise (including, without limitation, with respect to the achievement of any Performance Criteria (as defined and used in the Plan)) shall be made in good faith by the Board or its Committee, whose decision shall be binding on all parties. In such event, all unvested Shares shall be automatically and immediately forfeited by the Employee to the Company and the Common Stock represented by the unvested Shares shall again be available for the grant of awards under the Plan. The Employee hereby appoints the Company as the attorney-in-fact of the Employee to take such actions as may be necessary or appropriate to effectuate a transfer of the record ownership of any such shares that are forfeited hereunder.
(c) Notwithstanding the foregoing, in accordance with and subject to the provisions of the Plan, the Committee may, in its discretion, accelerate the date that any installment of these Shares becomes exercisable.
3. Restrictions on Transfer . The Employee shall not sell, assign, transfer, pledge, or otherwise encumber all or any of his unvested Shares, except as permitted by the Plan.
(a) The Company’s obligation to deliver the Shares to the Employee shall be subject to the satisfaction of all applicable federal, state and local income and employment tax withholding requirements (“Withholding Taxes”). In order to satisfy all Withholding Taxes due with respect to the Employee’s Shares, the Employee agrees to the following:
(i) As a condition of receiving any vested Shares, on the date of this Agreement the Employee must execute the Irrevocable Standing Order to Sell Shares, attached hereto as Exhibit A (the “Standing Order”), which authorizes the Company and its authorized broker to take the actions described in this subsection 4.(a)(i). The Employee agrees to deposit a sufficient number of the Shares into his or her account at such broker and authorizes such broker to sell, at the market price and on the vesting date (or the first business day thereafter if the vesting date falls on a day when the market is closed), the number of vested Shares that the Company has instructed such broker is necessary to obtain proceeds sufficient to satisfy the Withholding Taxes, unless the Employee pays the Company sufficient funds in the form of cash to satisfy the Withholding Taxes within a period of time, as determined by the Company in its sole discretion if the Company so elects, prior to the vesting date. The Employee understands and agrees that the number of Sha