22nd CENTURY GROUP, INC.

2010 EQUITY INCENTIVE PLAN

 

RESTRICTED STOCK AWARD AGREEMENT

 

This Agreement is made as of ___________________ (the “Effective Date”), between
22nd Century Group, Inc., a Nevada corporation with an address at 9530 Main
Street, Clarence, New York 14031, (the “Company”) and ____________________, an
individual residing at _______________________________________ (the
“Executive”).

 

WHEREAS, the Company has adopted the 22nd Century Group, Inc. 2010 Equity
Incentive Plan (the “Plan”), providing for the grant to certain officers,
employees, directors, consultants and advisors of the Company and its Affiliates
the opportunity to acquire shares of the Company’s Common Stock; and

 

WHEREAS, the Board has determined that it would be in the best interest of the
Company and its shareholders to provide the Executive with an incentive to
remain in the service of the Company and to increase shareholder value by
providing the Executive with the opportunity to own Common Stock of the Company.

 

NOW THEREFORE, in consideration of the promises and mutual agreements set forth
in this Agreement, the Executive and the Company hereby agree as follows:

 

1.          Grant of Award.

 

(a)          Award. The Company, as of the Effective Date, hereby grants to the
Executive an award (the “Award”) of ___________ shares of Common Stock of the
Company (“Restricted Shares” or “Shares”) subject to the restrictions, terms and
conditions set forth below and in the Plan.

 

(b)          Equity Plan. This Award is granted pursuant to the Plan, a copy of
which the Executive acknowledges having received. The terms and conditions of
the Plan are incorporated into this Agreement by reference. If there is a
conflict between the provisions of this Agreement and the provisions of the
Plan, the provisions of the Plan will govern. Capitalized terms not otherwise
defined in this Agreement have the meanings set forth in the Plan.

 

2.          Vesting of Award.

 

_____________

 

3.          Dividend and Voting Rights.

 

Subject to the terms of the Plan, the Executive will have all the rights of a
shareholder of the Company with respect to voting the Restricted Shares awarded
under this Agreement and receipt of dividends and distributions on such Shares.

 

4.          Restrictions on Transfer.

 

_____________

 

 

 

 

5.          Issuance and Custody of Certificate.

 

(a)          Legends.

 

The Company will cause to be issued one or more stock certificates, registered
in the name of the Executive evidencing the Restricted Shares granted under this
Award. Each certificate issued in respect of the Restricted Shares will bear the
following legend:

 _____________

 

6.          Agreements of the Executive.

 

The Executive acknowledges that: (a) this Agreement is not a contract of
employment and the terms of the Executive’s employment are not affected in any
way by this Agreement except as specifically provided in this Agreement; and (b)
the Award made by this Agreement does not confer any legal rights upon the
Executive for continuation of employment or interfere with or limit the right of
the Company to terminate the Executive’s employment at any time.

 

7.          Legal Compliance Restrictions.

 

The Company is not obligated to issue or deliver any certificates evidencing
Restricted Shares awarded by this Agreement unless and until the Company is
advised by its counsel that the issuance and delivery of the certificates are in
compliance with all applicable laws, regulations of governmental authorities and
the requirements of any securities exchange upon which the Common Stock of the
Company is traded.

 

8.          Taxes.

 

The Company has agreed to pay the federal income taxes, state income taxes, and
payroll taxes (if applicable) incurred by the Executive with respect to the
Award made by this Agreement – up to a limit of thirty percent (30%) of fair
market value of the shares as determined by Troconi Segarra and Associates. The
Executive agrees to pay or make arrangements for the payment to the Company of
the amount of any remaining tax liability with respect to the Award made by this
Agreement. Payment will be due on the date the Company is required to withhold
such taxes. In the event that any payment is not made when due, the Company has
the right (a) to deduct, to the extent permitted by law, from any payment of any
kind otherwise due to Executive from the Company all or a part of the amount
required to be withheld, or (b) to pursue any other remedy at law or in equity.

 

9.          Notices.

 

Except as otherwise provided in this Agreement, all offers, notices and other
communications given pursuant to this Agreement will be deemed to have been
properly given if in writing and (a) hand delivered, (b) mailed, addressed to
the appropriate party at the address of the party as shown at the beginning of
this Agreement, postage prepaid, by certified or registered mail or by Federal
Express or similar overnight courier service, or (c) sent by e-mail, facsimile
or similar electronic transmission, with confirmation sent by way of one of the
methods provided above. Either party may from time to time designate by written
notice given in accordance with the provisions of this Section any other address
or party to which such notice or communication or copies thereof must be sent.

 

 

 

 

10.         Binding Effect.

 

This Agreement is binding upon, and inures to the benefit of, the respective
successors, assigns, heirs, executors, administrators and guardians of the
parties hereto.

 

11.         Opportunity to Review.

 

The Executive acknowledges and understands that this Agreement has been prepared
on behalf of the Company by its legal counsel. The Executive further
acknowledges and understands that it is advisable for him to, and he has had
reasonable opportunity to, consult with legal counsel or other independent
advisors, other than the Company’s legal counsel, with respect to the terms and
conditions of this Agreement

 

12.         Severability.

 

Whenever possible, each provision of this Agreement will be interpreted in such
a manner as to be enforceable under applicable law. However, if any provision of
this Agreement is deemed unenforceable under applicable law by a court having
jurisdiction, the provision will be unenforceable only to the extent necessary
to make it enforceable without invalidating the remainder thereof or any of the
remaining provisions of this Agreement.

 

13.         New York Law.

 

This Agreement will be construed and interpreted in accordance with the laws of
the State of New York without regard to principles of conflicts of law.

 

14.         Multiple Counterparts.

 

This Agreement may be executed in one or more counterparts, each of which will
be deemed an original, but all of which together will constitute one and the
same instrument. Any party may execute this Agreement by facsimile signature and
the other party is entitled to rely on such facsimile signature as evidence that
this Agreement has been duty executed by that party. Any party executing this
Agreement by facsimile signature must immediately forward to the other party an
original signature page by overnight mail.

 

IN WITNESS WHEREOF, the Company and the Executive have caused this Agreement to
be executed and delivered, all as of the day and year first above written.

 

            22nd CENTURY GROUP, INC.         By:       Name:       Title: