Attached files
EXHIBIT
10.6
PACIFIC
ASIA PETROLEUM, INC.
2009
EQUITY INCENTIVE PLAN
NOTICE OF RESTRICTED SHARES
GRANT
Capitalized but otherwise undefined
terms in this Notice of Restricted Shares Grant and the attached Restricted
Shares Grant Agreement shall have the same defined meanings as in the Pacific
Asia Petroleum, Inc. 2009 Equity Incentive Plan (the “Plan”).
Grantee
Name: __________________________________ Address:
______________________________
You have been granted Restricted Shares
subject to the terms and conditions of the Plan and the attached Restricted
Shares Grant Agreement, as follows:
Date of
Grant: _______________________________________________
Vesting Commencement
Date:___________________________________
Price Per
Share:______________________________________________
Total Number of Shares
Granted:_________________________________
Total Value of Shares
Granted:___________________________________
Total Purchase
Price:_________________$0_______________________
Agreement
Date:_____________________________________________
Vesting
Schedule: ____________________________________________
PACIFIC
ASIA PETROLEUM, INC.
2009
EQUITY INCENTIVE PLAN
RESTRICTED SHARES GRANT
AGREEMENT
This RESTRICTED SHARES GRANT AGREEMENT
(“Agreement”),
dated as of the Agreement Date specified on the Notice of Restricted Shares
Grant is made by and between PACIFIC ASIA PETROLEUM, INC., a Delaware Company
(the “Company”),
and the grantee named in the Notice of Restricted Shares Grant (the “Grantee,”
which term as used herein shall be deemed to include any successor to Grantee by
will or by the laws of descent and distribution, unless the context shall
otherwise require).
BACKGROUND
Pursuant to the Plan, the Company,
acting through the Administrator, approved the issuance to Grantee, effective as
of the date set forth above, of an award of the number of Restricted Shares as
is set forth in the attached Notice of Restricted Shares Grant (which is
expressly incorporated herein and made a part hereof, the “Notice of
Restricted Shares Grant”) at the purchase price per share of Restricted
Shares (the “Purchase
Price”), if any, set forth in the attached Notice of Restricted Shares
Grant, upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in
consideration of the mutual premises and undertakings hereinafter set forth, the
parties agree as follows:
1. Grant and
Purchase of Restricted Shares. The Company hereby grants to
Grantee, and Grantee hereby accepts the number of Restricted Shares set forth in
the Notice of Restricted Shares Grant, subject to the payment by Grantee of the
total purchase price, if any, set forth in the Notice of Restricted Shares
Grant.
2. Stockholder
Rights.
(a) Voting
Rights. Until such time as all or any part of the Restricted
Shares are forfeited to the Company under this Agreement, if ever, Grantee (or
any successor in interest) has the rights of a stockholder, including voting
rights, with respect to the Restricted Shares subject, however, to the transfer
restrictions or any other restrictions set forth in the Plan.
(b) Dividends and Other
Distributions. During the period of restriction, Participants
holding Restricted Shares are entitled to all regular cash dividends or other
distributions paid with respect to all Shares while they are so
held. If any such dividends or distributions are paid in Shares, such
Shares will be subject to the same restrictions on transferability and
forfeitability as the Restricted Shares with respect to which they were
paid.
3. Vesting
of Restricted Shares.
(a) The
Restricted Shares are restricted and subject to forfeiture until
vested. The Restricted Shares which have vested and are no longer
subject to forfeiture are referred to as “Vested
Shares.” All Restricted Shares which have not become Vested
Shares are referred to as “Nonvested
Shares.”
(b) Restricted
Shares will vest and become nonforfeitable in accordance with the vesting
schedule contained in the Notice of Restricted Shares Grant.
(c) Any
Nonvested Shares of Grantee will automatically vest and become nonforfeitable if
Grantee’s service with the Company ceases owing to the Grantee’s (a) death, (b)
Disability, or (c) Retirement, unless the Administrator provides
otherwise.
(d) In the
event of a Change in Control, the Administrator, in its discretion, may
accelerate the time at which all or any portion of Grantee’s Restricted Shares
will vest.
(e) Terms
used in Section
3 and Section
4 have the following meanings:
(i) “Cause” has
the meaning ascribed to such term or words of similar import in Grantee’s
written employment or service contract with the Company or its subsidiaries and,
in the absence of such agreement or definition, means Grantee’s
(i) conviction of, or plea of nolo contendere to, a felony
or crime involving moral turpitude; (ii) fraud on or misappropriation of
any funds or property of the Company or its subsidiaries, or any affiliate,
customer or vendor; (iii) personal dishonesty, incompetence, willful
misconduct, willful violation of any law, rule or regulation (other than minor
traffic violations or similar offenses), or breach of fiduciary duty which
involves personal profit; (iv) willful misconduct in connection with
Grantee’s duties or willful failure to perform Grantee’s responsibilities in the
best interests of the Company or its subsidiaries; (v) illegal use or
distribution of drugs; (vi) violation of any material rule, regulation,
procedure or policy of the Company or its subsidiaries, the violation of which
could have a material detriment to the Company; or (vii) material breach of
any provision of any employment, non-disclosure, non-competition,
non-solicitation or other similar agreement executed by Grantee for the benefit
of the Company or its subsidiaries, all as reasonably determined by the Board of
Directors of the Company, which determination will be conclusive.
(ii) “Retirement”
means Grantee’s retirement from Company employ at age 65 as determined in
accordance with the policies of the Company or its subsidiaries in good faith by
the Board of Directors of the Company, which determination will be final and
binding on all parties concerned.
(f) Nonvested
Shares may not be sold, transferred, assigned, pledged, or otherwise disposed
of, directly or indirectly, whether by operation of law or
otherwise. The restrictions set forth in this Section will terminate
upon a Change in Control.
4. Forfeiture
of Nonvested Shares. Except as provided herein, if Grantee's
service with the Company ceases for any reason other than Grantee’s (a) death,
(b) Disability, or (c) Retirement, any Nonvested Shares will be automatically
forfeited to the Company, subject to the re-payment by the Company at the lesser
of (1) the original purchase price paid by the Participant pursuant to the Award
Agreement or (2) the Shares’ Fair Market Value on the date of repurchase;
provided, however, that the Administrator may cause any Nonvested Shares
immediately to vest and become nonforfeitable if Grantee’s service with the
Company is terminated by the Company without Cause.
(a) Legend. Each
certificate representing Restricted Shares granted pursuant to the Notice of
Restricted Shares Grant may bear a legend substantially as follows:
“THE SALE
OR OTHER TRANSFER OF THE SHARES REPRESENTED BY THIS CERTIFICATE, WHETHER
VOLUNTARY, INVOLUNTARY OR BY OPERATION OF LAW, IS SUBJECT TO CERTAIN
RESTRICTIONS ON TRANSFER AS SET FORTH IN THE PACIFIC ASIA PETROLEUM, INC. 2009
EQUITY INCENTIVE PLAN AND IN A RESTRICTED SHARE GRANT AGREEMENT. A
COPY OF SUCH PLAN AND SUCH
AGREEMENT
MAY BE OBTAINED FROM PACIFIC ASIA PETROLEUM, INC.”
(b) Escrow of Nonvested
Shares. The Company has the right to retain the certificates
representing Nonvested Shares in the Company’s possession until such time as all
restrictions applicable to such Shares have been satisfied.
(c) Removal of
Restrictions. The Participant is entitled to have the legend
removed from certificates representing Vested Shares.
5. Recapitalizations,
Exchanges, Mergers, Etc. The provisions of this Agreement
apply to the full extent set forth herein with respect to any and all shares of
capital stock of the Company or successor of the Company which may be issued in
respect of, in exchange for, or in substitution for the Restricted Shares by
reason of any stock dividend, split, reverse split, combination,
recapitalization, reclassification, merger, consolidation or otherwise which
does not terminate this Agreement. Except as otherwise provided
herein, this Agreement is not intended to confer upon any other person except
the parties hereto any rights or remedies hereunder.
6. Grantee
Representations.
Grantee represents to the Company the
following:
(a) Restrictions on
Transfer. Grantee acknowledges that the Restricted Shares to
be issued to Grantee must be held indefinitely unless subsequently registered
and qualified under the Securities Act or unless an exemption from registration
and qualification is otherwise available. In addition, Grantee
understands that the certificate representing the Restricted Shares will be
imprinted with a legend which prohibits the transfer of such Restricted Shares
unless they are sold in a transaction in compliance with the Securities Act or
are registered and qualified or such registration and qualification are not
required in the opinion of counsel acceptable to the Company.
(b) Relationship to the Company;
Experience. Grantee either has a preexisting business or
personal relationship with the Company or any of its officers, directors or
controlling persons or, by reason of Grantee’s business or financial experience
or the business or financial experience of Grantee’s personal representative(s),
if any, who are unaffiliated with and who are not compensated by the Company or
any affiliate or selling agent, directly or indirectly, has the capacity to
protect Grantee’s own interests in connection with Grantee’s acquisition of the
Restricted Shares to be issued to Grantee hereunder. Grantee and/or
Grantee’s personal representative(s) have such knowledge and experience in
financial, tax and business matters to enable Grantee and/or them to utilize the
information made available to Grantee and/or them in connection with the
acquisition of the Restricted Shares to evaluate the merits and risks of the
prospective investment and to make an informed investment decision with respect
thereto.
(c) Grantee’s
Liquidity. In reaching the decision to invest in the
Restricted Shares, Grantee has carefully evaluated Grantee’s financial resources
and investment position and the risks associated with this investment, and
Grantee acknowledges that Grantee is able to bear the economic risks of the
investment. Grantee (i) has adequate means of providing for
Grantee’s current needs and possible personal contingencies, (ii) has no
need for liquidity in Grantee’s investment, (iii) is able to bear the
substantial economic risks of an investment in the Restricted Shares for an
indefinite period and (iv) at the present time, can afford a complete loss
of such investment. Grantee’s commitment to investments which are not
readily marketable is not disproportionate to Grantee’s net worth and Grantee’s
investment in the Restricted Shares will not cause Grantee’s overall commitment
to become excessive.
(d) Access to
Data. Grantee acknowledges that during the course of this
transaction and before deciding to acquire the Restricted Shares, Grantee has
been provided with financial and other written information about the
Company. Grantee has been given the opportunity by the Company to
obtain any information and ask questions concerning the Company, the Restricted
Shares, and Grantee’s investment that Grantee felt necessary; and to the extent
Grantee availed himself of that opportunity, Grantee has received satisfactory
information and answers concerning the business and financial condition of the
Company in response to all inquiries in respect thereof.
(e) Risks. Grantee
acknowledges and understands that (i) an investment in the Company
constitutes a high risk, (ii) the Restricted Shares are highly speculative,
and (iii) there can be no assurance as to what investment return, if any,
there may be. Grantee is aware that the Company may issue additional
securities in the future which could result in the dilution of Grantee’s
ownership interest in the Company.
(f) Valid
Agreement. This Agreement when executed and delivered by
Grantee will constitute a valid and legally binding obligation of Grantee which
is enforceable in accordance with its terms.
(g) Residence. The
address set forth on the Notice of Restricted Shares Grant is Grantee’s current
address and accurately sets forth Grantee’s place of residence.
(h) Tax
Consequences. Grantee has reviewed with Grantee’s own tax
advisors the federal, state, local and foreign tax consequences of this
investment and the transactions contemplated by this
Agreement. Grantee is relying solely on such advisors and not on any
statements or representations of the Company or any of its
agents. Grantee understands that Grantee (and not the Company) is
responsible for Grantee’s own tax liability that may arise as a result of the
transactions contemplated by this Agreement. Grantee understands that
Section 83 of the Internal Revenue Code of 1986, as amended (the “Code”),
taxes as ordinary income the difference between the purchase price for the
Restricted Shares and the fair market value of the Restricted Shares as of the
date any restrictions on the Restricted Shares lapse. Grantee
understands that Grantee may elect to be taxed at the time the Restricted Shares
is purchased rather than when and as the restrictions lapse by filing an
election under Section 83(b) of the Code with the Internal Revenue Service
within 30 days from the date of purchase. The form for making this
election is attached as Exhibit A
hereto.
GRANTEE
ACKNOWLEDGES THAT IT IS GRANTEE’S SOLE RESPONSIBILITY AND NOT THE COMPANY’S TO
FILE TIMELY ANY ELECTION UNDER SECTION 83(b), EVEN IF GRANTEE REQUESTS THE
COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON GRANTEE’S
BEHALF.
7. No
Employment Contract Created. The issuance of the Restricted
Shares is not be construed as granting to Grantee any right with respect to
continuance of employment or any service with the Company or any of its
subsidiaries. The right of the Company or any of its subsidiaries to
terminate at will Grantee's employment or terminate Grantee’s service at any
time (whether by dismissal, discharge or otherwise), with or without cause, is
specifically reserved, subject to any other written employment or other
agreement to which the Company and Grantee may be a party.
8. Tax
Withholding. The Company has the power and the right to deduct
or withhold, or require Grantee to remit to the Company, an amount sufficient to
satisfy Federal, state and local taxes (including the Grantee’s FICA obligation)
required by law to be withheld with respect to the grant and vesting of the
Restricted Shares.
9. Interpretation. The
Restricted Shares are being issued pursuant to the terms of the Plan, and are to
be interpreted in accordance therewith. The Administrator will
interpret and construe this Agreement and the Plan, and any action, decision,
interpretation or determination made in good faith by the Administrator will be
final and binding on the Company and Grantee.
10. Notices. All notices or
other communications which are required or permitted hereunder will be in
writing and sufficient if (i) personally delivered or sent by telecopy, (ii)
sent by nationally-recognized overnight courier or (iii) sent by registered or
certified mail, postage prepaid, return receipt requested, addressed as
follows:
(a) if
to the Grantee, to the address (or telecopy number) set forth on the Notice of
Grant; and
(b) if
to the Company, to its principal executive office as specified in any report
filed by the Company with the Securities and Exchange Commission or to such
address as the Company may have specified to the Grantee in writing, Attention:
Corporate Secretary;
or to
such other address as the party to whom notice is to be given may have furnished
to the other party in writing in accordance herewith. Any such
communication will be deemed to have been given (i) when delivered, if
personally delivered, or when telecopied, if telecopied, (ii) on the first
Business Day (as hereinafter defined) after dispatch, if sent by
nationally-recognized overnight courier and (iii) on the fifth Business Day
following the date on which the piece of mail containing such communication is
posted, if sent by mail. As used herein, “Business
Day” means a day that is not a Saturday, Sunday or a day on which banking
institutions in the city to which the notice or communication is to be sent are
not required to be open.
11. Specific
Performance. Grantee expressly agrees that the Company will be
irreparably damaged if the provisions of this Agreement and the Plan are not
specifically enforced. Upon a breach or threatened breach of the
terms, covenants and/or conditions of this Agreement or the Plan by Grantee, the
Company will, in addition to all other remedies, be entitled to a temporary or
permanent injunction, without showing any actual damage, and/or decree for
specific performance, in accordance with the provisions hereof and
thereof. The Administrator has the power to determine what
constitutes a breach or threatened breach of this Agreement or the
Plan. Any such determinations will be final and conclusive and
binding upon Grantee.
12. No
Waiver. No waiver of any
breach or condition of this Agreement will be deemed to be a waiver of any other
or subsequent breach or condition, whether of like or different
nature.
13. Grantee
Undertaking. Grantee hereby
agrees to take whatever additional actions and execute whatever additional
documents the Company may in its reasonable judgment deem necessary or advisable
in order to carry out or effect one or more of the obligations or restrictions
imposed on Grantee pursuant to the express provisions of this
Agreement.
14. Modification
of Rights. The rights of
Grantee are subject to modification and termination in certain events as
provided in this Agreement and the Plan.
15. Governing
Law. This Agreement is
governed by, and construed in accordance with, the laws of the State of
Delaware, without giving effect to its conflict or choice of law principles that
might otherwise refer construction or interpretation of this Agreement to the
substantive law of another jurisdiction.
16. Counterparts;
Facsimile Execution. This Agreement
may be executed in one or more counterparts, each of which will be deemed to be
an original, but all of which together will constitute one
17. and the
same instrument. Facsimile execution and delivery of this Agreement
is legal, valid and binding execution and delivery for all
purposes.
18. Entire
Agreement. This Agreement
(including the Notice of Restricted Shares Grant) and the Plan, constitute the
entire agreement between the parties with respect to the subject matter hereof,
and supersede all previously written or oral negotiations, commitments,
representations and agreements with respect thereto.
19. Severability. In the event one
or more of the provisions of this Agreement should, for any reason, be held to
be invalid, illegal or unenforceable in any respect, such invalidity, illegality
or unenforceability will not affect any other provisions of this Agreement, and
this Agreement will be construed as if such invalid, illegal or unenforceable
provision had never been contained herein.
20. WAIVER OF
JURY TRIAL. THE GRANTEE
HEREBY EXPRESSLY, IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY
LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND FOR ANY COUNTERCLAIM
THEREIN.
[Signature Page
Follows]
IN WITNESS WHEREOF, the
parties hereto have executed this Restricted Share Grant Agreement as of the
date first written above.
PACIFIC ASIA PETROLEUM,
INC.
By:________________________________________
Name:___________________________________
Title:____________________________________
GRANTEE:
__________________________________________
Name:
SPOUSE'S
CONSENT TO AGREEMENT
(Required
where Grantee resides in a community property state)
I acknowledge that I have read the
Agreement and the Plan and that I know and understand the contents of
both. I am aware that my spouse has agreed therein to the imposition
of certain forfeiture provisions and restrictions on transferability with
respect to the Restricted Shares that are the subject of the Agreement,
including with respect to my community interest therein, if any, on the
occurrence of certain events described in the Agreement. I hereby
consent to and approve of the provisions of the Agreement, and agree that I will
abide by the Agreement and bequeath any interest in the Restricted Shares which
represents a community interest of mine to my spouse or to a trust subject to my
spouse's control or for my spouse's benefit or the benefit of our children if I
predecease my spouse.
Dated:
____________________________________
Signature
____________________________________
Print Name
Print Name
Exhibit
A
ELECTION
UNDER SECTION 83(b)
OF
THE INTERNAL REVENUE CODE OF 1986
The undersigned taxpayer hereby elects,
pursuant to Sections 55 and 83(b) of the Internal Revenue Code of 1986, as
amended, to include in taxpayer’s gross income or alternative minimum taxable
income, as the case may be, for the current taxable year the amount of any
compensation taxable to taxpayer in connection with taxpayer’s receipt of the
property described below.
1. The
name, address, taxpayer identification number and taxable year of the
undersigned are as follows:
TAXPAYER:
|
SPOUSE:
|
|
NAME:
|
||
ADDRESS:
|
||
IDENTIFICATION
NO.:
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TAXABLE
YEAR:
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2. The
property with respect to which the election is made is described as follows:
____ shares (the “Shares”)
of the Common Stock of Pacific Asia Petroleum, Inc. (the “Company”).
3.
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The
date on which the property was transferred is:___________________
,______.
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4.
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The
property is subject to the following
restrictions:
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The
Shares may not be transferred and are subject to forfeiture under the terms of
an agreement between the taxpayer and the Company. These restrictions
lapse upon the satisfaction of certain conditions contained in such
agreement.
5. The
fair market value at the time of transfer, determined without regard to any
restriction other than a restriction which by its terms will never lapse, of
such property is: $_________________.
6.
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The
amount (if any) paid for such property
is: $_________________.
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The undersigned has submitted a copy of
this statement to the person for whom the services were performed in connection
with the undersigned’s receipt of the above-described property. The
transferee of such property is the person performing the services in connection
with the transfer of said property.
The undersigned understands
that the foregoing election may not be revoked except with the consent of the
Commissioner.
Dated:
______________________,
_____
Taxpayer
The undersigned spouse of taxpayer
joins in this election.
Dated:
______________________,
_____
Spouse of
Taxpayer