Exhibit 10.2
RESTRICTED STOCK AGREEMENT
THIS RESTRICTED STOCK AGREEMENT is made as of the 29th day of January,
2007 by and between ____________________ (the "Participant") and SmartPros Ltd.,
a Delaware corporation (the "Company"), pursuant to the Company's Amended and
Restated 1999 Stock Option Plan (the "Plan").
WHEREAS, the Compensation Committee (the "Committee") of the Board of
Directors of the Company at its meeting on January 29, 2007 authorized and
directed the Company to make an award of shares of its common stock, par value
$.0001 per share (the "Common Stock") to the Participant under the Plan for the
purposes expressed in the Plan;
NOW THEREFORE, in consideration of the foregoing and the mutual
undertakings herein contained, the parties agree as follows:
1. GRANT OF STOCK. In accordance with the terms of the Plan and subject
to the further terms, conditions and restrictions contained in this Agreement,
the Company hereby grants to the Participant _____ shares (the "Shares") of
Common Stock, of which ___ Shares shall vest immediately (the "Vested Shares")
and the balance shall constitute "Restricted Shares," subject to the
Restrictions set forth in Section 4 of this Agreement.
2. CERTIFICATES FOR SHARES. Certificates evidencing Restricted Shares
shall be deposited with the Company to be held in escrow until such Released
Shares are released to the Participant or forfeited in accordance with this
Agreement. The Participant shall, simultaneously with the delivery of this
Agreement, deliver to the Company a stock power, in blank, executed by the
Participant.
If any Restricted Shares are forfeited, the Company shall direct the
transfer agent of the Common Stock to make the appropriate entries in its
records showing the cancellation of the certificate or certificates for such
Restricted Shares and to return the Shares represented thereby to the Company's
treasury.
3. ADJUSTMENTS IN RESTRICTED SHARES. In the event of any change in the
outstanding Common Stock by reason of a stock dividend or distribution,
recapitalization, merger, consolidation, split-up, combination, exchange of
shares or the like, the Committee shall make equitable adjustments in the
Restricted Shares corresponding to adjustments made by the Committee in the
number and class of shares of Common Stock which may be issued under the Plan.
Any new, additional or different securities to which the Participant shall be
entitled in respect of Restricted Shares by reason of such adjustment shall be
deemed to be Restricted Shares and shall be subject to the same terms,
conditions, and restrictions as the Restricted Shares so adjusted.
4. RESTRICTIONS. During applicable periods of restriction determined in
accordance with Section 6 of this Agreement, Restricted Shares and all rights
with respect to such Shares, may not be sold, assigned, transferred, exchanged,
pledged, hypothecated or otherwise encumbered or disposed of and shall be
subject to the risk of forfeiture contained in Section 5 of this Agreement (such
limitations on transferability and risk of forfeiture being herein referred to
as "Restrictions"), but the Participant shall have all other rights of a
stockholder, including, but not limited to, the right to vote and receive
dividends on Restricted Shares.
5. FORFEITURE OF RESTRICTED SHARES. Except as otherwise set forth in
Section 6(b) below, in the event that the Participant's employment with the
Company or any of its subsidiaries terminates for
any reason, such event shall constitute an "Event of Forfeiture" and all Shares
which at that time are Restricted Shares shall thereupon be forfeited by the
Participant to the Company without payment of any consideration by the Company,
and neither the Participant nor any successor, heir, assign or personal
representative of the Participant shall have any right, title or interest in or
to such restricted Shares or the certificate evidencing them.
6. LAPSE OF RESTRICTIONS. (a) Except as provided in subsection (b)
below, the Restrictions on the Restricted Shares granted under this Agreement
shall lapse ratably in accordance with the following schedule:
Number of Shares on Which Restrictions
Date Lapse
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January 29, 2008
January 29, 2009
(b) Notwithstanding anything contained in Section 5
above, in the event that (i) a Participant's employment with the Company and its
subsidiaries terminates as a result of his or her death, retirement or permanent
disability or (ii) the Participant's employment with the Company is terminated
by the Company without "cause", the Restrictions shall lapse on the Restricted
Shares (if not already lapsed pursuant to subsection (a) above) on the date of
such event. For purposes of this Agreement the term "cause" shall have the same
meaning attributed to such term in any employment agreement between the
Participant on the one hand and the Company or any of its subsidiaries on the
other hand. In the event, there is no such employment agreement or, if there is,
and such employment agreement does not define the term "cause", then, as used
herein "cause" shall mean the occurrence of any of the following events:
(i) the willful engaging by Participant in illegal
conduct or gross misconduct;
(ii) gross negligence or willful malfeasance in the
performance of Participant's duties after receiving notice from the Company that
such conduct constitutes gross negligence or willful malfeasance in the
performance of Participant's duties;
(iii) the willful and continued failure of
Participant to perform substantially his or her duties with the Company (other
than any such failure resulting from incapacity due to physical or mental
illness), after a written demand for substantial performance is delivered to
Participant by an officer of the Company that specifically identifies such
failure; provided that Participant shall have thirty (30) days following the
delivery of such written demand to remedy the failures identified therein; or
(iv) conviction of Participant in a court of law of a
crime relating to his employment, or of any felony.
Any determination by the Board of Directors of the Company (the "Board") that
termination was with or without "cause" shall be deemed to be conclusive and
binding on the Company and Participant.
(c) Upon the occurrence of a "change in control", the unlapsed
Restrictions with respect to any Restricted Shares shall lapse. For purposes of
this Agreement, "change in control" means a change in control of the Company,
which will be deemed to have occurred if:
(i) any "person," as such term is used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act") (other than (A) the Company, (B)
any trustee or other fiduciary holding securities under an
employee benefit plan of the Company or (C) any corporation
owned, directly or indirectly, by the stockholders of the
Company in substantially the same proportions as their
ownership of the Common Stock, is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company
representing one-third (33 1/3%) or more of the combined
voting power of the Company's then outstanding voting
securities;
(ii) the following individuals cease for any reason
to constitute a majority of the number of directors then
serving: individuals who, on the date hereof, constitute the
Board and any new director (other than a director whose
initial assumption of office is in connection with an actual
or threatened election contest, including but not limited to a
consent solicitation, relating to the election of directors of
the Company) whose appointment or election by the Board or
nomination for election by the Company's stockholders was
approved or recommended by a vote of at least two-thirds (2/3)
of the directors then still in office who either were
directors on the date hereof or whose appointment, election or
nomination for election was previously so approved or
recommended;
(iii) there is consummated a merger or consolidation
of the Company or any direct or indirect subsidiary of the
Company with any other corporation, other than a merger or
consolidation immediately following which the individuals who
comprise the Board immediately prior thereto constitute at
least a majority of the Board, the entity surviving such
merger or consolidation or, if the Company or the entity
surviving such merger is then a subsidiary, the ultimate
parent thereof; or
(iv) the stockholders of the Company approve a plan
of complete liquidation of the Company or there is consummated
an agreement for the sale or disposition by the Company of all
or substantially all of the Company's assets (or any
transaction having a similar effect), other than a sale or
disposition by the Company of all or substantially all of the
Company's assets to an entity, immediately following which the
individuals who comprise the Board immediately prior thereto
constitute at least a majority of the board of directors of
the entity to which such assets are sold or disposed of or, if
such entity is a subsidiary, the ultimate parent thereof.
Notwithstanding the foregoing, a Change in Control shall not be deemed to have
occurred by virtue of (x) a registered public offering of the Company's
securities (debt or equity) or (y) the consummation of any transaction or series
of integrated transactions immediately following which the holders of the Common
Stock immediately prior to such transaction or series of transactions continue
to have substantially the same proportionate ownership in an entity which owns
all or substantially all of the assets of the Company immediately following such
transaction or series of transactions.
(d) Upon lapse of the Restrictions in accordance with this
Section, the Company shall, as soon as practicable thereafter, deliver to the
Participant an unrestricted certificate for the Restricted Shares with respect
to which such Restrictions have lapsed.
7. WITHHOLDING REQUIREMENTS. The Company shall have the right to
withhold from sums due to the Participant (or to require the Participant to
remit to the Company) an amount sufficient to satisfy any Federal, state or
local withholding tax requirements with respect to any Shares prior to
delivering any certificate evidencing such Shares.
8. LEGENDS AND PROSPECTUS DELIVERY REQUIREMENT.
(a) Participant acknowledges and agrees that the certificates
evidencing the Restricted Shares shall bear the following legend:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS AND OBLIGATIONS STATED IN AND ARE TRANSFERABLE ONLY UPON
COMPLIANCE WITH THE PROVISIONS OF A RESTRICTED STOCK AGREEMENT, DATED
AS OF JANUARY 29, 2006, BETWEEN SMARTPROS LTD. AND THE REGISTERED
HOLDER, A COPY OF WHICH AGREEMENT IS ON FILE IN THE OFFICE OF THE
SECRETARY OF SMARTPROS LTD."
(b) Participant acknowledges and agrees that the certificates
evidencing the Shares shall bear the following legend:
"THE RE-OFFER AND RESALE OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), PURSUANT TO A REGISTRATION STATEMENT ON FORM S-8,
AND MAY NOT BE OFFERED OR SOLD EXCEPT (I) PURSUANT TO A CURRENT
PROSPECTUS UNDER THE REGISTRATION STATEMENT, (II) PURSUANT TO A
SEPARATE EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (III) TO THE
EXTENT APPLICABLE, PURSUANT TO RULE 144 UNDER ACT (OR ANY SIMILAR RULE
UNDER SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES) OR, (IV) UPON
THE DELIVERY BY THE HOLDER TO SMARTPROS LTD. OF AN OPINION OF COUNSEL,
REASONABLY SATISFACTORY TO COUNSEL FOR SMARTPROS LTD., STATING THAT AN
EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE."
8. EFFECT OF EMPLOYMENT. Nothing contained in this Agreement shall
confer upon the Participant the right to continue in the employment of the
Company or affect any right which the Company may have to terminate the
employment of the Participant.
9. AMENDMENT. This Agreement may not be amended except with the consent
of the Committee and by a written instrument duly executed by the Participant
and the Company.
10. BINDING EFFECT. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their heirs, personal
representatives, successors and assigns. Participant acknowledges receipt of a
copy of the Plan, which is annexed hereto, represents that he or she if familiar
with the terms and provisions thereof and accepts the award of Shares hereunder
subject to all of the terms and conditions thereof and of this Agreement.
Participant hereby agrees to accept as binding, conclusive and final all
decisions and interpretations of the Committee upon any questions arising under
the Plan or this Agreement.
IN WITNESS WHEREOF, the Company and the Participant have each executed
and delivered this Agreement as of the date first above written.
ATTEST: SMARTPROS LTD.
By:
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Secretary Chief Executive Officer
PARTICIPANT:
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