RESTRICTED STOCK AGREEMENT
THIS
RESTRICTED STOCK AGREEMENT (this
"Agreement")
is
made effective as of December 20, 2007 (the "Grant
Date"),
by
and between Lev Pharmaceuticals, Inc., a Delaware corporation (the "Company"),
and
____________ (the "Holder"):
WHEREAS,
the
Compensation Committee of the Company’s Board of Directors and the Company’s
Board of Directors have determined that it would be to the advantage and in
the
best interest of the Company and its stockholders to enter into this Agreement
to assign certain shares of Common Stock of the Company subject to certain
restrictions thereon (hereinafter referred to as the "Restricted
Stock")
to the
Holder in consideration of services to be rendered and as an incentive for
the
Holder’s best performance of future services to Company and its subsidiaries,
subject to the restrictions set forth herein;
WHEREAS,
the
Company and the Holder entered into a Second Amended and Restated Employment
Agreement dated December 20, 2007 (the "Employment
Agreement").
NOW,
THEREFORE,
in
consideration of the mutual covenants herein contained and other good and
valuable consideration, receipt of which is hereby acknowledged, the parties
hereto do hereby agree as follows:
ARTICLE
I.
AWARD
OF RESTRICTED STOCK
Section
1.1 Award
of Restricted Stock.
In
consideration of Holder’s services and for other good and valuable consideration
which the Committee has determined, the Company hereby awards and assigns to
the
Holder, on the Grant Date, 2,000,000 shares of Restricted Stock.
Section
1.2 Not
a
Contract of Employment.
Nothing
in this Agreement shall confer upon the Holder any right to continue in the
employ of the Company or any subsidiary, or shall interfere with or restrict
in
any way any otherwise existing rights of the Company and any subsidiary, which
are hereby expressly reserved, to discharge the Holder at any time for any
reason whatsoever, with or without Cause (subject to the consequences set forth
in the Employment Agreement).
ARTICLE
II.
TERMS
OF THE AWARD AND RESTRICTIONS
Section
2.1 Definition.
Unless
the context otherwise requires, terms defined in the Employment Agreement have
the same meanings when used in this Agreement.
"Committee"
shall
mean the compensation committee of the Board of Directors of the Company.
"Common
Stock”
shall
mean common
stock of the Company, $0.01 par value per share.
"Restrictions"
shall
mean the restrictions on sale or other transfer set forth in Section 3.1, the
exposure to forfeiture set forth in Section 2.2 and the vesting set forth in
Section 2.3.
Section
2.2 Forfeiture.
Any
share
of Restricted Stock that is not vested pursuant to Section 2.3 upon the
termination of employment of the Holder with the Company and its subsidiaries
by
the Company for Cause or by the Holder other than for Good Reason shall
thereupon be forfeited to the Company without payment. In the event of the
termination of the Holder’s employment as a result of his death or Disability,
by the Company without Cause or by the Holder with Good Reason, the Restricted
Stock that is not vested pursuant to Section 2.3 shall remain outstanding and
continue to vest through the last Vesting Date.
Section
2.3 Vesting
and Lapse of Restrictions.
Subject
to Sections 2.2, 2.4 and 2.6, each share of Restricted Stock shall not be
transferable until such share becomes vested pursuant to this Section. The
shares shall vest in accordance with the following schedule (each a "Vesting
Date"):
(a) 1,000,000
(50%) of the Restricted Stock shall vest and the Restrictions thereon shall
lapse on the FDA Approval Date, subject to Holder's continued employment with
the Company on such date;
(b) 500,000
(25%) of the Restricted Stock shall vest and the Restrictions thereon shall
lapse on the first (1st)
anniversary of the FDA Approval Date, subject to Holder's continued employment
with the Company on such date; and
(c) 500,000
(25%) of the Restricted Stock shall vest and the restrictions thereon shall
lapse on the second (2nd)
anniversary of the FDA Approval Date, subject to Holder's continued employment
with the Company on such date; provided,
however,
that if
a Vesting Date shall fall on a date which is during a black-out period with
respect to the Common Stock to which Holder is subject, such Vesting Date shall
be delayed until the first day after the expiration of such black-out
period.
2
Section
2.4 Legends.
Certificates
representing shares of Restricted Stock assigned pursuant to this Agreement
shall, until all Restrictions lapse or shall have been removed and new
certificates are assigned pursuant to Section 2.5, be held by the Company and
bear the following legend:
"THE
SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN VESTING
REQUIREMENTS UNDER THE TERMS OF THAT CERTAIN RESTRICTED STOCK AGREEMENT BY
AND
BETWEEN LEV PHARMACEUTICALS, INC. (THE "COMPANY") AND THE REGISTERED OWNER
OF
SUCH SHARES, AND SUCH SHARES MAY NOT BE, DIRECTLY OR INDIRECTLY, VOLUNTARILY
OR
INVOLUNTARILY, OR BY OPERATION OF LAW, OFFERED, TRANSFERRED, SOLD, ASSIGNED,
PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF UNDER ANY CIRCUMSTANCES, EXCEPT
PURSUANT TO THE PROVISIONS OF SUCH AGREEMENT. A COPY OF THE AGREEMENT MAY BE
OBTAINED FROM THE COMPANY"
In
addition to the foregoing, legend, certificates representing shares of
Restricted Stock awarded hereunder shall, if required, bear a restrictive legend
required under applicable federal or state securities laws.
Section
2.5 Assignment
of Certificates for Vested Shares.
Upon
the
vesting of the shares of the Restricted Stock as provided in Section 2.3 and
subject to Section 3.3, the Company shall cause new certificates to be assigned
with respect to such vested shares and delivered to the Holder or his legal
representative, free from any Restrictions and free from the legend provided
for
in Section 2.4; provided, that such shares shall remain subject to applicable
securities laws and the Company’s employee trading policy. Such vested shares
shall cease to be considered Restricted Stock subject to the terms and
conditions of this Agreement and shall be shares of Common Stock of the Company
free of all Restrictions (other than any applicable securities law restrictions
or any restrictions imposed by the Company’s employee trading
policy).
Section
2.6 Restrictions
On New Shares.
In
the
event that the Holder receives any new or additional or different shares or
securities by reason of any transaction or event described in Section 2.7,
such new or additional or different shares or securities which are attributable
to the Holder in his capacity as the registered owner of the Restricted Stock
then subject to Restrictions, shall be considered to be Restricted Stock and
shall be subject to all of the Restrictions, unless the Committee provides,
for
the removal or lapse of the Restrictions on the shares of Restricted Stock
underlying the distribution of the new or additional shares or
securities.
3
Section
2.7 Special
Circumstances.
(a) Merger
and Consolidation.
In
the
event of a Change in Control, the unvested shares of Restricted Stock shall
be
assumed by the acquiring company and converted into restricted stock of the
acquiring company (or parent company) in a manner designed to preserve the
economic value of the Restricted Stock immediately prior to the Change in
Control and in a manner consistent with the treatment of other shareholders;
provided that if the consideration received in the Change in Control is in
the
form of cash, the acquiring company (or the acquirer’s parent company, as
applicable) may either assume such unvested shares of Restricted Stock as
provided above or may pay the Holder an amount in cash on each applicable
Vesting Date for such shares as if the Restricted Stock was assumed as provided
above based upon the fair market value of the acquiring company’s (or its
parent’s, as applicable) capital stock on each of the applicable Vesting Dates.
For
the
purposes hereof, "fair market value" shall be either:
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(i)
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the
average of the high and low or closing bid and asked prices of the
acquiring company’s (or its parent’s) capital stock on each Vesting Date
if such stock is listed for trading on a national securities exchange,
the
NASDAQ Stock Market or is traded on the over-the-counter bulletin
board;
or
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(ii)
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if
the acquiring company’s (or its parent’s) capital stock is not publicly
traded, then as determined by an independent valuation company mutually
acceptable to the Holder and the acquirer.
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(b) Adjustments. In
the
event of a Change in Control or any other corporate event or transaction that
does not constitute a Change in Control (including, but not limited to, a change
in the shares of the Company or the capitalization of the Company) such as
a
merger, consolidation, reorganization, recapitalization, separation, stock
dividend, stock split, reverse stock split, split up, spin-off, or other
distribution of stock or property of the Company, combination of shares,
exchange of shares, dividend in kind, or other like change in capital structure
or distribution (other than normal cash dividends) to shareholders of the
Company, or any similar corporate event or transaction, the Committee in order
to prevent dilution or enlargement of the Holder’s rights, shall substitute or
adjust, as applicable, the number and kind of shares that may be issued under
this Agreement.
(c) Investment
Undertaking.
The
Holder hereby represents and warrants that he will hold the Restricted Stock
and
the rights constituent thereto for investment and without any present intention
of distribution or sale.
4
Section
2.8 Withholding.
On
each
Vesting Date, the Holder will have the option of (a) electing to have the
Company withhold, the number of shares sufficient to satisfy the minimum tax
withholding from the shares to satisfy such tax withholding obligations, or
(b)
delivery to the Company of an amount in cash or Common Stock of the Company
with
a fair market value equal to the amount of such tax obligation.
Section
2.9 Voting
Rights.
To
the
extent permitted by law, the Holder shall be entitled to exercise full voting
rights with respect to those shares of Restricted Stock that have not yet
vested.
Section
2.10 Beneficiary
Designation.
The
Holder may, from time to time, name any beneficiary or beneficiaries (who may
be
named contingently or successively) to whom any benefit under this Agreement
is
to be paid in case of his death before he receives any or all of such benefit.
Each such designation shall revoke all prior designations by the Holder, shall
be in a form prescribed by the Committee, and will be effective only when filed
by the Holder in writing with the Company during the Holder's lifetime. In
the
absence of any such designation, benefits remaining unpaid at the Holder's
death
shall be paid to the Holder's estate.
Section
2.11 Dividend
Equivalents.
The
Holder may be granted dividend equivalents based on the dividends declared
on
shares of Common Stock of the Company that are subject to this award of
Restricted Stock, to be credited as of dividend payment dates, during the period
between the Grant Date and each Vesting Date as determined by the Committee.
Such dividend equivalents shall be converted to cash or additional shares of
Common Stock of the Company by such formula and at such time and subject to
such
limitations as may be determined by the Committee in good faith.
ARTICLE
III.
MISCELLANEOUS
Section
3.1 Restricted
Stock Not Transferable.
No
share
of Restricted Stock or any interest or right therein or part thereof shall
be
liable for the debts, contracts or engagements of the Holder or his successors
in interest or shall be subject to disposition by transfer, alienation,
anticipation, pledge, encumbrance, assignment or any other means whether such
disposition be voluntary or involuntary or by operation of law by judgment,
levy, attachment, garnishment or any other legal or equitable proceedings
(including bankruptcy) until such time as the share of Restricted Stock has
vested, and any attempted disposition thereof shall be null and void and of
no
effect.
5
Section
3.2 Conditions
to Delivery of Stock Certificates.
The
Company shall not be required to deliver any certificate or certificates for
shares of stock pursuant to this Agreement prior to fulfillment of all of the
following conditions:
(a) Approval.
The
obtaining of any approval or other clearance from any state or federal
governmental agency which the Committee shall, in its sole discretion, determine
to be necessary or advisable; and
(b) Payment.
The
payment by the Holder of all amounts required to be withheld, under federal,
state and local (or applicable foreign) tax laws, with respect to the issuance
and/or the lapse or removal of any of the Restrictions which may be paid either
by the Holder or by the Holder electing that the Company withhold that number
of
shares of Common Stock with a fair market value equal to the minimum tax
withholding obligation at the election of the Holder.
Section
3.3 Physical
Custody.
The
Secretary of the Company or such other representative as the Committee may
appoint shall retain physical custody of each certificate representing
Restricted Stock until all of the restrictions imposed under the Agreement
with
respect to the shares evidenced by such certificate expire or shall have been
removed; provided, however, that in no event shall the Holder retain physical
custody of any certificates representing unvested Restricted Stock assigned
to
Holder and provided further that the Company may determine not to issue
certificates, but rather to make a book entry to reflect the issuance of the
shares.
Section
3.4 Notices.
Any
notice required by this Agreement will be deemed provided and delivered to
the
intended recipient when (i) delivered in person by hand
or, in
accordance with applicable law, via the Company’s e-mail or intranet
site;
or (ii)
three days after being sent via U.S. certified mail, return receipt requested;
or (iii) the day after being sent via overnight courier, in each case provided
such notice is properly addressed to the following address and enclosed in
a
properly sealed envelope or wrapper, and with all postage and similar fees
having been paid in advance.
| If to the Company: |
Lev
Pharmaceuticals, Inc.
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000
Xxxxx Xxxxxx
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Xxxxx
0000
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Xxx
Xxxx, XX 00000
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| And if to the Holder: | To the address specified in the Company’s payroll records. |
By
a
notice given pursuant to this Section 3.4, either party may hereafter designate
a different address for notices to be given. Any notice which is required to
be
given to the Holder shall, if the Holder is then deceased, be given to the
Holder’s personal representative if such representative has previously informed
the Company of representative’s status and address by written notice under this
Section 3.4.
6
Section
3.5 Rights
as Stockholder.
Except
as
otherwise provided herein, upon delivery of the shares of Restricted Stock
to
the representative pursuant to Section 3.3, the Holder shall have, unless
otherwise provided by the Committee, all the rights of a stockholder with
respect to said shares, including the right to vote and the right to receive
all
dividends and other distributions paid or made with respect to the shares;
provided,
however,
that in
the discretion of the Committee, any extraordinary distributions with respect
to
the Restricted Stock shall be subject to the Restrictions and provided
further that
such
rights shall terminate immediately as to any shares of Restricted Stock that
cease to be eligible for vesting.
Section
3.6 Withholding
Tax.
The
Holder agrees that, in the event of the issuance of the Restricted Stock or
the
expiration of Restrictions thereon results in the Holder’s realization of income
which for federal, state or local income tax purposes is, in the opinion for
the
Company, subject to withholding of tax at source by the Company, the Holder
will
pay to the Company an amount equal to such withholding tax prior to the
Company’s delivery of the Certificate or the Company shall withhold that number
of Shares of Common Stock with a Fair Market Value equal to the minimum tax
withholding obligation.
Section
3.7 Titles.
Titles
are provided herein for convenience only and are not to serve as a basis for
interpretation or construction of this Agreement.
Section
3.8 Conformity
to Securities Laws.
The
Holder acknowledges that this Agreement is intended to conform to the extent
necessary with all provisions of all applicable federal and state (and
applicable foreign) laws, rules and regulations (including but not limited
to,
the Securities Act and the Exchange Act and to such approvals by any listing,
regulatory or other governmental authority as may, in the opinion of counsel
for
the Company, be necessary or advisable in connection therewith. Notwithstanding
anything herein to the contrary, this Agreement shall be administered, and
the
Restricted Stock shall be assigned, only in such a manner as to conform to
such
laws, rules and regulations including, without limitation, Rule 16b-3. To the
extent permitted by applicable law, this Agreement and the Restricted Stock
assigned hereunder shall be deemed amended to the extent necessary to conform
to
such laws, rules and regulations.
Section
3.9 Amendment
and Successors.
(a) Amendment.
This
Agreement may be amended without the consent of the Holder provided that such
amendment would not impair any rights of the Holder under this Agreement. No
amendment of this Agreement shall, without the consent of the Holder, impair
any
rights of the Holder under this Agreement.
7
(b) Successors.
All
obligations of the Company under this Agreement with respect to the award of
Restricted Stock shall be binding on any successor to the Company, whether
the
existence of such successor is the result of a direct or indirect purchase,
merger, consolidation, or otherwise, of all or substantially all of the business
and/or assets of the Company.
Section
3.10 Governing
Law and Jurisdiction.
(a) Governing
Law. The
laws
of the State of New York shall govern the interpretation, validity,
administration, enforcement and performance of the terms of this Agreement
regardless of the law that might be applied under principles of conflicts of
laws.
(b) Jurisdiction.
The
Holder irrevocably agrees that any legal action, suit or proceeding arising
out
of or relating to this Agreement may be brought in the courts of the United
States of America located in the Southern District of New York or in the courts
of the State of New York located in the Borough of Manhattan. By the execution
of this Agreement, the Holder irrevocably submits to the jurisdiction of any
such court in any such action, suit or proceeding. Final judgment against the
Holder in any such action, suit or proceeding shall be conclusive and may be
enforced in any other jurisdiction by suit on the judgment, a certified or
exemplified copy of which shall be conclusive evidence of the judgment, or
in
any other manner provided by law.
Section
3.11 Section
83(b) Election.
If,
within
30 days of the Grant Date, a
Holder
makes an election under Section 83(b) of the Code, or any successor section
thereto, to be taxed with respect to all or any portion of the Restricted Stock
as of the date of transfer of the Restricted Stock rather than as of the date
or
dates upon which the Holder would otherwise be taxable under Section 83(a)
of
the Code, the Holder shall deliver a copy of such election to the Company
immediately after filing such election with the Internal Revenue
Service.
Section
3.12 No
Constraint on Corporate Action.
Nothing
in this Agreement shall be construed to: (a) limit, impair, or otherwise affect
the Company's or a subsidiary's or an affiliate's right or power to make
adjustments, reclassifications, reorganizations, or changes of its capital
or
business structure, or to merge or consolidate, or dissolve, liquidate, sell,
or
transfer all or any part of its business or assets; or, (b) limit the right
or
power of the Company or a subsidiary or an affiliate to take any action which
such entity deems to be necessary or appropriate.
8
IN
WITNESS WHEREOF, this Agreement has been executed and delivered by the parties
hereto.
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LEV
PHARMACEUTICALS, INC.,
a Delaware corporation
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| Its: | ||
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| HOLDER | ||
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