WILD OATS MARKETS, INC. 2006 EQUITY INCENTIVE PLAN RESTRICTED STOCK UNIT AGREEMENT FOR DIRECTORS
WILD OATS MARKETS, INC.
2006 EQUITY INCENTIVE PLAN
RESTRICTED STOCK UNIT AGREEMENT FOR DIRECTORS
THIS RESTRICTED STOCK UNIT AGREEMENT (the "Agreement") made as of this ___
day of ______, 20__, between Wild Oats Markets, Inc., a Delaware corporation (the
"Company"), and (Name) (the "Grantee").
RECITALS
1. As of ____________ the Company grants (the "Grant") the Grantee Restricted
Stock Units ("RSUs"), which are exchangeable for shares of Company common stock
(the "Stock") under the Wild Oats Markets, Inc. 2006 Equity Incentive Plan (the
"Plan") according to the Distribution Election, a form of which is attached
hereto, made by the Grantee and pursuant to this Agreement.
2. The Company and the Grantee wish to provide for the grant of the RSUs on the terms
and conditions set forth below. RSUs shall only be available to non-employee members
("Directors") of the Board of Directors (the "Board") of the Company.
AGREEMENT
1. Grant of RSUs.
(a) Pursuant to the Plan and subject to the terms and conditions of this Agreement, the
Company hereby grants to the Grantee ___ RSUs effective as of ______, 20__. The amount of
RSUs granted is based upon the following calculation (check all applicable):
___ Board meeting grant: $3,450 (115% of $3,000) divided by the fair market value
("FMV") as determined below, of the Stock on the NASDAQ National Market.
___ Committee meeting grant: $2,300 (115% of $2,000) divided by the FMV of the Stock on
the NASDAQ National Market.
___ Annual service grant: 4,000 RSUs granted each year for service on the Board.
___ Other:______________________________________________________________
(b) For each Grant, the FMV of the Stock shall be determined with reference to the
closing price of the Stock as of last trading day prior to the last day of each board
meeting. In the event a board meeting adjourns on a day during which the Stock is not
traded, FMV shall be determined with reference to the closing price of the Stock on the
last trading day immediately preceding the last day of the board meeting. In all other
events, the FMV of the Stock shall be determined with reference to the closing price on
the day prior to the determination of FMV.
(c) In the event the operation of this paragraph results in the vesting of fractional
shares, the number of Units Vested shall be rounded to the next whole Unit.
2. Vesting.
(a) All RSUs will be vested on the date of grant, other than those granted for annual
service on the Board, which shall vest on the date immediately preceding the next annual
meeting of stockholders. If the Grantee is not a Director on the date immediately
preceding the next annual meeting of stockholders and the Grant is not otherwise vested
under this Agreement, then the Grant shall be null and void.
(b) Reorganization and Change in Control.
(i) Full Vesting; Termination; Assumption or Substitution. Upon
the occurrence of a Change in Control (as defined in Section 9(b) of the Plan), the Units
shall become fully vested and payable regardless of whether all conditions for vesting
relating to length of service have been satisfied and without regard to any deferral
elections. The Committee may also provide for the assumption or substitution of the Units
by the surviving entity and make any other provision for the Units as the Committee deems
appropriate in its sole discretion.
(ii) Assumption or Substitution. The Company, or the successor
or purchaser, as the case may be, may make adequate provision for the assumption of the
Units or the substitution of new Units for the outstanding Units on terms comparable to
the terms of this Agreement.
(c) All RSUs shall vest upon the death or Disability (as that term is defined in
Section 22(e) of the Internal Revenue Code) of the Grantee.
3. Payment for RSUs, Delivery of Stock Certificates. When the
RSUs become payable, the RSUs shall be settled in shares of Stock in accordance with the
Distribution Election made by the Director prior to the first receipt of RSUs under the
Plan (the "Payment Date").
Notwithstanding any distribution election by the Grantee, in the case of death or
Disability, as that term is defined in paragraph 2(d) above, of the Grantee, the RSUs
shall be payable within thirty (30) days following death or determination of Disability.
In the event the 30th day falls on a day during which the Stock is not traded, payment
shall be made on the next trading day following the 30th day. Subject to the provisions of
Section 5 below, stock certificates (the "Certificates") evidencing the Stock
shall be issued to the Grantee as of the Payment Date and registered in the Grantee's name
on the records of the Company. Subject to and conditioned on the satisfaction of any
withholding obligations, the Certificates shall be delivered to the Grantee as soon as
practicable after the Payment Date. Notwithstanding the foregoing, if, at the time that
payment is due under this Section 3, the Company's deduction for compensation payable to
the Grantee is subject to the restrictions of Section 162(m) of the Internal Revenue Code
of 1986, as amended ("Section 162(m)"), payment shall not be made until the
Company's deduction for the compensation attributable to the payment is not limited by
Section 162(m).
4. Dividend Equivalents. The Grantee shall be entitled to
receive cash payments (referred to as dividend equivalents) equal to any cash dividends
and other distributions paid in cash with respect to a corresponding number of shares of
Stock.
5. Adjustments to the Units. The Units granted under this
Agreement shall be adjudicated under Section 11 of the Plan if necessary for changes in
the stock of the Company.
6. Withholding. Upon the award, vesting, and/or payment of any
number of the Units, the Grantee shall make appropriate arrangements with the Company to
make payment to the Company of the amount required to be withheld under applicable
federal, state, local, and other tax laws (collectively, "Withholding Taxes").
The Grantee may elect to pay such Withholding Taxes in cash by delivering to the Company a
check payable to the order of the Company. If the Withholding Taxes arise on or after the
date the Units become payable, the Grantee may, in addition to the methods described in
the preceding sentence, elect to pay such Withholding Taxes (a) by selling a portion of
the Stock then payable under this Agreement if otherwise permitted by this Agreement or
(b) as permitted by Section 11(d) of the Plan and as otherwise permitted by this
Agreement, by having the Company withhold from the shares otherwise payable and
deliverable to the Grantee a number of shares having a Fair Market Value equal to the
amount of the minimum required Withholding Taxes, or such lesser amount as the Grantee may
elect. In such case, the value of the shares to be withheld shall be based on the Fair
Market Value of the shares on the date the amount of Withholding Taxes is determined (the
"Tax Date"). The Grantee must make an irrevocable election of the manner of
payment of the Withholding Taxes no later that fourteen (14) calendar days prior to the
Tax Date; provided however, if the Grantee is subject to Section 16(b) of the Securities
Exchange Act of 1934, the election shall be made in accordance with the requirements of
Rule 16b-3. If, on and after the time the Units become payable, the Grantee has not made
arrangements satisfactory to the Company to pay the Withholding Taxes, the Company shall
withhold from the shares, a number of shares having a Fair Market Value equal to the
amount required to pay the Withholding Taxes. The value of the shares to be withheld shall
be based on the Fair Market Value of the shares on the Tax Date. The Company shall not
deliver any shares of Stock unless and until the Grantee has delivered to the Company, or
has made arrangements satisfactory to the Company to provide fully for, the required
Withholding Taxes. The amount of cash dividend equivalents pursuant to Section 5 shall be
subject to Withholding Taxes applicable to wages.
7. Restriction on Transferability. Units, whether or not
vested, may not be sold, assigned, transferred by gift or otherwise, pledged or
hypothecated, or otherwise disposed of, by operation of law or otherwise at any time. Any
attempt to do so shall be null and void.
8. No Rights as a Stockholder. The Grantee shall have no voting
or any other rights as a stockholder of the Company with respect to the RSUs. Upon payment
of the RSUs and the transfer of shares of Stock to the Grantee, the Grantee shall have all
of the rights of a stockholder of the Company. The Grantee's right to receive Stock under
this Agreement shall be no greater than the right of any unsecured general creditor of the
Company.
9. Miscellaneous.
(a) Notices. Any notice required or permitted to be given under
this Agreement shall be in writing and shall be given by first class registered or
certified mail, postage prepaid, or by personal delivery to the appropriate party,
addressed:
(i) If to the Company, to Wild Oats Markets, Inc., Attention: Corporate Secretary, ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇, or at such other address as may have been furnished
to the Grantee in writing by the Company; or
(ii) If to the Grantee, to the Grantee at Wild Oats Markets, Inc., Attention: Corporate
Secretary, ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇, or at other address as may have
been furnished to the Company by the Grantee.
Any such notice shall be deemed to have been given as of the second day after deposit
in the United States mails, postage prepaid, properly addressed as set forth above, in the
case of mailed notice, or as of the date delivered in the case of personal delivery.
(b) Amendment. Except as provided herein, this Agreement may
not be amended or otherwise modified unless evidenced in writing and signed by the Company
and the Grantee. Notwithstanding the foregoing, this Agreement may be amended in the sole
discretion of the Committee by a writing that states specifically that it is amending this
Agreement if a copy of the amendment is delivered to the Grantee; provided, however, that
no amendment may adversely affect the rights of the Grantee without the Grantee's written
consent. Without limiting the foregoing, the Committee reserves the right to change, by
written notice to the Grantee, the provisions of the Units in any way that it may deem
necessary or advisable to implement the purposes of the grant and this Agreement as a
result of any change in applicable laws and regulations or any future law, regulation,
ruling, or judicial decision, provided that any such change shall be applicable only to
such Units that are then subject to the restrictions provided in this Agreement.
(c) Defined Terms. Capitalized terms shall have the meaning set
forth in the Plan or herein, as the case may be.
(d) Construction; Severability. The section headings contained
herein are for reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement. The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other provision of
this Agreement, and each other provision of this Agreement shall be severable and
enforceable to the extent permitted by law.
(e) Waiver. Any provision contained in this Agreement may be
waived, either generally or in any particular instance, by the Committee appointed under
the Plan, but only to the extent permitted under the Plan.
(f) Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the Company and the Grantee and their respective heirs, executors,
administrators, legal representatives, successors and assigns.
(g) Rights to Employment. Nothing contained in this Agreement
shall be construed as giving the Grantee any right to be retained in the employ of the
Company and this Agreement is limited solely to governing the rights and obligations of
the Grantee with respect to the Units.
(h) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year
first above written.
Wild Oats Markets, Inc.
By:
GRANTEE
PLEASE SIGN BELOW:
Print Name:
Address: