Exhibit 10.3

 

AVATECH SOLUTIONS, INC.

 

AMENDED AND RESTATED

 

RESTRICTED STOCK AWARD PLAN

 

Adopted May 14, 2003

 

Approved by the Shareholders October 30, 2003

 

Amended August 23, 2005

 

Purpose. The Avatech Solutions, Inc. Restricted Stock Award Plan (the “Plan”) is
intended to provide incentives which will attract and retain highly competent
persons as officers, directors, key employees and consultants of Avatech
Solutions, Inc. (the “Company”) and its present or future subsidiaries
(“Subsidiaries”), by providing them with opportunities to acquire common stock
of the Company, par value par value $0.01 per share (“Common Stock”) pursuant to
terms and restrictions contained in this Plan and in an agreement with the
Company (an “Award”).

 

Administration. The Board of Directors (“Board”) of the Company shall supervise
and administer the Plan. The Board will resolve any questions of interpretation
of the Plan or of any Awards, and such determination shall be final and binding
upon all persons. The Compensation Committee of the Board of Directors (so long
as the Compensation Committee is comprised of two or more non-employee directors
within the meaning of Rule 16b-3 under the Exchange Act of 1934, 17 C.F.R. §
240.16b-3(b)(3)) (the “Committee”) shall have any or all of the powers and
discretions vested in the Board under the Plan, except the power to amend or
terminate the Plan. Any determination of the Committee under the Plan may be
made without notice or meeting of the Committee, by writing signed by a majority
of the Committee members.

 

Awards. “Award Shares” are shares of Common Stock transferred to Participants
(as defined in 0) pursuant to an Award in exchange for past or future service to
the Company or its Subsidiaries without other payment therefore.

 

Governing Agreements. Each Award will be governed by an “Award,” which may
contain any provision the Board determines appropriate, including without
limitation, provisions for the forfeiture of and restrictions on the sale,
resale or other disposition of shares acquired under any Award, provisions
giving the Company the right to repurchase shares acquired under any Award,
provisions to comply with federal and state securities laws, or understandings
or conditions as to the Participant’s employment, in addition to those
specifically provided for under the Plan.

 

Nontransferability. Except as provided below or as explicitly provided in the
Award, a Participant may not transfer Common Stock represented by an Award that
is subject to forfeiture, redemption or other restriction on resale imposed by
its governing Award (“Unvested Shares”).

 

Unvested Shares (i) may be tendered in response to a tender offer for a request
or invitation to tenders of greater than 50 percent of the outstanding Common
Stock of the Company or (ii) may be surrendered in a merger, consolidation or
share exchange involving the Company; provided, in each case, that the
securities or other consideration (including any cash) received in exchange for
the Unvested Shares will be subject to the restrictions and conditions on the
Unvested Shares set forth in the Award. In the event of and immediately upon
receipt by a third party of Unvested Shares by any person or entity other than
the Company pursuant to a transaction under this Section 0, the Unvested Shares
will no longer be subject to restrictions on transfer, sale, assignment, etc.
imposed by this Plan or any Award.

 

In the event of any change in the outstanding Common Stock resulting from a
subdivision or consolidation of shares, whether through reorganization,
recapitalization, share split, reverse share split, share distribution or
combination of shares or the payment of a share dividend, the Unvested Shares
shall be treated in the same manner in any such transaction as other Common
Stock. Any Common Stock or other securities received by the Grantee with respect
to the Unvested Shares in any such transaction shall be subject to the
restrictions and conditions set forth in this Award.

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In the event that Unvested Shares are transferred by will or the laws of descent
and distribution, any payments shall be made only to the executor or
administrator of the estate of the deceased Participant or the person or persons
to whom the deceased Participant’s rights under the Award shall pass by will or
the laws of descent and distribution and only to the extent, if any, that the
deceased Participant was entitled at the date of the Participant’s death.

 

Participants. The Board, in its sole discretion, will designate “Participants”
to receive Award Shares. Notwithstanding this authority, the Board may designate
as Participants only natural persons who:

 

are employees, officers, directors, or consultants of the Company or one of its
Subsidiaries and immediately prior to receiving the designated Award, are owners
of common stock or options to purchase common stock of the Company; or

 

are officers or directors of the Company regardless of ownership of any common
stock or options to purchase common stock of the Company.

 

Award Shares may be granted under this Plan to persons who have previously
received Award Shares or other benefits under this or other plans of the
Company.

 

Shares Reserved Under the Plan. There is hereby reserved for issuance as Award
Shares under the Plan an aggregate of 1,200,000 shares of Common Stock, which
may be authorized but unissued or treasury shares.

 

Reissue of Shares. Any shares of Common Stock subject an Award may thereafter be
subject to a new Award under the Plan if the shares of Common Stock are issued
under an Award and are subsequently reacquired by the Company pursuant to the
terms of the Award.

 

Adjustment Provisions. If the Company at any time changes the number of issued
shares of Common Stock without new consideration to the Company (by stock
dividend, stock split, or a similar transaction), the total number of shares
reserved for issuance under the Plan and the number of shares covered by each
outstanding Award shall be adjusted so that the value of each such Award shall
not be changed. Awards may contain provisions for their continuation or for
other equitable adjustments after changes in the Common Stock resulting from
reorganization, sale, merger, consolidation or similar occurrences.

 

Valuation. The fair market value of the Award Shares on any given day will be:

 

if the Common Stock is listed on a national securities exchange, the mean
between the highest and lowest sale prices reported as having occurred on the
primary exchange with which the Stock is listed and traded on the date prior to
such date, or, if there is no such sale on that date, then on the last preceding
date on which such a sale was reported;

 

if the Common Stock is not listed on any national securities exchange but is
quoted in the National Market System of the National Association of Securities
Dealers Automated Quotation System on a last sale basis, the average between the
high bid price and low ask price reported on the date prior to such date, or, if
there is no such sale on that date, then on the last preceding date on which a
sale was reported;

 

if the common stock is listed on the OTC Bulletin Board, the last closing price
of the common stock of the Company on the OTC Bulletin Board as of the close of
business on the last business day prior to the date on which the shares are to
be valued.

 

if the Common Stock is not listed on a national securities exchange nor quoted
in the National Market System of the National Association of Securities Dealers
Automated Quotation System on a last sale basis, nor listed on the OTC Bulletin
Board, the most recent price at which shares of the Company’s common stock
traded in any recognized securities market.

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if the Common Stock is not listed on a national securities exchange nor quoted
in the National Market System of the National Association of Securities Dealers
Automated Quotation System on a last sale basis, nor listed on the OTC Bulletin
Board, nor traded in any recognized securities market, the amount determined by
the Board to be the fair market value based upon a good faith attempt to value
the Stock accurately and computed in accordance with applicable regulations of
the Internal Revenue Service; or

 

in the event of a transaction pursuant to judicial order, state law, or a vote
of the majority of the Company’s shareholders which results in receipt of value
by the shareholders in exchange for their shares of common stock, that same
amount received by the shareholders.

 

No Employment Agreement. Neither this Plan nor any Award are, nor should either
be construed to embody or contain, an agreement or promise of future employment
of the Participant by the Company or its Subsidiaries. A Participant’s right, if
any, to continue to serve the Company or its Subsidiaries as an officer,
employee or otherwise, shall not be enlarged or otherwise affected by the Plan.

 

Duration, Amendment and Termination. The Board may not grant Award Shares more
than ten years after the date on which the Plan is adopted by the Board;
provided, however, that the terms and conditions of any Award may thereafter be
amended or modified by mutual agreement between the Company and the Participant
or such other persons as may then have an interest in the Award.

 

The Board, pursuant to a mutual agreement between the affected Participant and
the Company, may grant Award Shares under the Plan or any future plan of the
Company in substitution and in exchange for, and in cancellation of, any
previously-granted Award Shares.

 

The Board may amend the Plan from time to time or terminate the Plan at any
time. However, no action authorized by this paragraph shall reduce the amount of
any existing Award or change the terms and conditions thereof without the
Participant’s consent. No amendment of the Plan shall, require the approval of
the stockholders of the Company, except to the extent required by law,
regulation or stock exchange requirements.