Exhibit 10.7

 

SHORE BANCSHARES, INC.

 

Form of

Restricted Stock Award Agreement

 

THIS AGREEMENT, dated as of the ____day of ____, 20__, between SHORE BANCSHARES,
INC., a Maryland corporation (the “Company”), and ______ (“Participant”), is
made pursuant and subject to the provisions of the Shore Bancshares, Inc. 2016
Stock and Incentive Compensation Plan, effective April 27, 2016 (the
“Plan”).  All capitalized terms used but not defined herein shall have the
meanings given such terms in the Plan.

 

1.         Award of Restricted Stock.  Pursuant to the Plan, the Company, on
________ (the “Award Date”), granted Participant _____ shares of restricted
Common Stock (“Restricted Stock”), subject to the terms and conditions of the
Plan and subject further to the terms and conditions set forth herein (the
“Award”).

 

2.         Restrictions.  Except as provided in this Agreement, the shares of
Restricted Stock are not transferable and are subject to a substantial risk of
forfeiture.

 

3.         Vesting.  Participant’s interest in the shares of Restricted Stock
shall become transferable and non-forfeitable (“Vested”) as follows:

 

Amount of Award Vested                               Vesting Date

 

Notwithstanding the foregoing, any shares of Restricted Stock that have not
Vested or been forfeited shall become Vested as of the earlier of (i) the date
of a Change in Control or (ii) the date of the Participant’s death.

 

4.         Forfeiture.  Upon the termination of Participant’s employment with
the Company or an Affiliate, any and all shares of Restricted Stock that have
not then become Vested pursuant to Section 3 shall lapse and be forfeited and
canceled.

 

5.         Shareholder Rights.  Participant shall have all the rights of a
stockholder of the Company with respect to the shares of Restricted Stock that
are not Vested, including the right to receive dividends on and to vote such
shares of Restricted Stock; provided, however, that (i) Participant may not
sell, transfer, pledge, exchange, hypothecate or otherwise dispose of any such
shares, (ii) the Company shall retain custody of the certificates evidencing
such shares as provided in Section 6, and (iii) Participant will deliver a stock
power in accordance with Section 7.

 

6.         Custody of Certificates.  Custody of all stock certificates
evidencing the shares of Restricted Stock shall be retained by the Company for
so long as such shares are not Vested.  The Company shall place a legend on each
certificate evidencing a share of Restricted Stock restricting the transfer of
such share.  As soon as practicable after

shares of Restricted Stock become Vested, the Company shall remove the
restrictive legend and deliver to Participant one ore more stock certificates
evidencing such shares.

 

7.         Stock Power.  Upon signing this Agreement, Participant shall deliver
to the Company a stock power, endorsed in blank, with respect to the shares of
Restricted Stock granted pursuant to this Award.  The Company shall use the
stock power to cancel any shares of Restricted Stock that do not become
Vested.  The Company shall return the stock power to Participant with respect to
any shares of Restricted Stock that become Vested.

 

8.         Fractional Shares.  Fractional shares shall not be issuable
hereunder, and when any provision hereof or the Plan may entitle Participant to
a fractional share, such fraction shall be disregarded.

 

9.         Taxes.  At the time shares of Restricted Stock become Vested, the
Company shall have the right to retain and withhold from such Vested shares that
portion representing the amount of taxes required by any governmental agency to
be withheld or otherwise deducted and paid with respect to such Vested shares,
calculated based on the Fair Market Value of a share of Common Stock as of the
date such shares become Vested.  Any shares so withheld shall be canceled by the
Company.

 

10.       No Right to Continued Employment.  This Agreement does not confer upon
Participant any right with respect to continuance of employment by the Company,
nor shall it interfere in any way with the right of the Company to terminate
Participant’s employment at any time.

 

11.       Governing Law.  This Agreement shall be governed by the laws of the
State of Maryland, without regard to any conflict of laws principles that would
apply the law of another jurisdiction.

 

12.       Participant Bound by Plan.  Participant acknowledges, by executing
this Agreement, that (1) this Agreement is subject in all respects to the
provisions of the Plan, as amended from time to time, the terms of which are
incorporated herein by reference and made a part hereof, (2) that a copy of the
Plan and all amendments thereto through the date hereof were provided to
Participant on the date hereof, and (3) he/she understands and accepts all of
the terms and conditions of the Plan.  In the event of any conflict between the
provisions of the Plan and the provisions of this Agreement, the provisions of
the Plan shall govern.

 

13.       Entire Agreement.  This Agreement sets forth the entire agreement of
the parties with respect to the subject matter hereof.  Any and all prior
agreements or understandings with respect to such matters are hereby superseded.

 

14.       Binding Effect.  Subject to the limitations stated above and in the
Plan, this Agreement shall be binding upon and inure to the benefit of the
legatees, distributees, and personal representatives of the Participant and the
successors of the Company.

 

 

 

 

IN WITNESS WHEREOF, the Company has caused this Agreement to be signed on its
behalf, and the Participant has affixed his signature hereto.

 

 

 

 

 

 

    

SHORE BANCSHARES, INC.

 

 

 

 

 

By

 

 

 

 

 

 

 

 

 

(Printed Name)

 

 

 

 

 

PARTICIPANT

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Printed Name)

 

 

 

 

 

 

 

 

Date