Exhibit 10(i)(b)

RESTRICTED STOCK UNIT AWARD AGREEMENT

(with related Dividend Equivalent Rights)

Tim Hortons Inc.

[Date]

THIS AGREEMENT, made effective as of the      day of             , 20     (the
“Date of Grant”), is between Tim Hortons Inc., a Delaware corporation (the
“Company”),                     , a                                          
(the “Employer”) and                      (the ”Grantee”) (collectively, the
“Parties”).

WHEREAS, the Company has adopted the Tim Hortons Inc. 2006 Stock Incentive Plan
(the “Plan”) in order to provide additional incentive to certain employees and
directors of the Company and its Subsidiaries; and

WHEREAS, pursuant to Section 4.2 of the Plan, the Committee has determined to
grant to the Grantee on the Date of Grant an Award of Stock Units with related
Dividend Equivalent Rights as provided herein to encourage the Grantee’s efforts
toward the continuing success of the Company and its Subsidiaries; and

WHEREAS, the Award is evidenced by this Agreement, which (together with the
Plan), describes all the terms and conditions of the Award.

NOW, THEREFORE, the Parties agree as follows:

1. Award.

1.1 The Company hereby grants to the Grantee in respect of employment services
provided by the Grantee to the Employer in 20    , an award (the “Award”) of
                     Restricted Stock Units with an equal number of related
Dividend Equivalent Rights. The Restricted Stock Units and related Dividend
Equivalent Rights granted pursuant to the Award shall be subject to the
execution and return of this Agreement by the Grantee (or the Grantee’s estate,
if applicable) to the Company as provided in Section 8 hereof. Subject to
Section 6 hereof, each Restricted Stock Unit represents the right to receive one
(1) Share at the time and in the manner set forth in Section 7 hereof.

1.2 Each Dividend Equivalent Right represents the right to receive all of the
cash dividends that are or would be payable with respect to the Share
represented by the Restricted Stock Unit to which the Dividend Equivalent Right
relates. With respect to each Dividend Equivalent Right, any such cash dividends
shall be converted into additional Restricted Stock Units based on the Fair
Market Value of a Share on the date such dividend is made (provided that no
fractional Restricted Stock Units shall be granted). Any additional Restricted
Stock Units granted pursuant to this Section shall be subject to the same terms
and conditions applicable to the Restricted Stock Unit to which the Dividend
Equivalent Right relates, including, without limitation, the restrictions on
transfer, forfeiture, vesting and payment provisions contained in Sections 2
through 8, inclusive, of this Agreement. In the event that a Restricted Stock
Unit is forfeited pursuant to Section 6 hereof, the related Dividend Equivalent
Right shall also be forfeited.

1.3 This Agreement shall be construed in accordance and consistent with, and
subject to, the provisions of the Plan (the provisions of which are hereby
incorporated by reference) and, except as otherwise expressly set forth herein,
the capitalized terms used in this Agreement shall have the same definitions as
set forth in the Plan.

2. Restrictions on Transfer.

The Restricted Stock Units and Dividend Equivalent Rights granted pursuant to
this Agreement may not be sold, transferred or otherwise disposed of and may not
be pledged or otherwise hypothecated.

 

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3. Vesting.

Except as otherwise provided in this Agreement, one-third (1/3) of the number of
Restricted Stock Units granted hereunder (rounded down to the next whole Stock
Unit, if necessary) shall vest on each of May 1, 20    , May 1, 20    
and November 1, 20     (each, a “Vesting Date”).

4. Effect of Certain Terminations of Employment

If the Grantee’s employment terminates as a result of the Grantee’s death,
Retirement or becoming Disabled or if the Grantee is terminated without Cause in
connection with the disposition of one or more restaurants or other assets of
the Company or its Subsidiaries or the sale or disposition of a Subsidiary, in
each case if such termination occurs on or after the Date of Grant, all
Restricted Stock Units which have not become vested in accordance with Section 3
or 5 hereof shall vest as of the date of such termination. For purposes of this
Agreement, Retirement shall mean termination of employment after attaining age
60 with at least 10 years of service (as defined in the Company’s qualified
retirement plans) other than by death, disability of for Cause.

5. Effect of Change in Control.

In the event of a Change in Control, which also constitutes a change in
ownership or effective control of the Company or a change in the ownership of a
substantial portion of its assets, in each case within the meaning of
Section 409A of the Code, at any time on or after the Date of Grant, all
Restricted Stock Units which have not become vested in accordance with Section 3
or 4 hereof shall vest immediately.

6. Forfeiture of Stock Units.

Except as otherwise provided in this Agreement, any and all Restricted Stock
Units which have not become vested in accordance with Section 3, 4 or 5 hereof
shall be forfeited and shall revert to the Company upon:

 

  (a) the termination of the Grantee’s employment with the Company or any
Subsidiary for any reason other than those set forth in Section 4 hereof prior
to such vesting; or

 

  (b) the commission by the Grantee of an Act of Misconduct prior to such
vesting.

For purposes of this Agreement, an “Act of Misconduct” shall mean the occurrence
of one or more of the following events: (x) the Grantee uses for profit or
discloses to unauthorized persons, confidential information or trade secrets of
the Company or any of its Subsidiaries, (y) the Grantee breaches any contract
with or violates any fiduciary obligation to the Company or any of its
Subsidiaries, or (z) the Grantee engages in unlawful trading in the securities
of the Company or any of its Subsidiaries or of another company based on
information gained as a result of the Grantee’s employment with, or status as a
director to, the Company or any of its Subsidiaries.

7. Issuance / Delivery of Shares.

Upon vesting of any Restricted Stock Units pursuant to this Agreement, the
Company shall, at its option either (i) issue treasury Shares to the Grantee
(or, if applicable, the Grantee’s estate); or (ii) deliver cash to a broker
designated by the Company who, as agent for the Grantee, shall purchase the
appropriate number of Shares on the open market. The number of Shares issued by
the Company or purchased by a broker for delivery to the Grantee at any
particular time pursuant to this Section shall correspond to the number of
Restricted Stock Units that become vested at that time, after taking into
account the reduction to the number of Shares as required under Section 10 of
this Agreement.

The Company will satisfy its obligations in this Section 7 on each Vesting Date
or as soon as administratively practicable and in any event no later than
December 31, 20    ; however, with respect to Restricted Stock Units that become
vested pursuant to Section 4 as a result of the Grantee’s Retirement or upon
becoming Disabled (other than a disability within the meaning of Section 409A of
the Code), if the Grantee is a “specified employee” within the meaning of
Section 409A of the Code as of the date of such vesting, the Company shall
satisfy its obligations in this Section 7 as soon as administratively
practicable after the first day of the calendar month following the date which
is six (6) months after the date on which the Restricted Stock Units become so
vested.

 

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8. Execution of the Award

The grant of the Restricted Stock Units and Dividend Equivalent Rights to the
Grantee pursuant to the Award shall be conditional upon the Grantee’s execution
and return of this Agreement to the Company or its designee (including by
electronic means, if so provided) no later than April     , 20     (the “Grantee
Return Date”); provided that if the Grantee’s Restricted Stock Units that would
otherwise vest pursuant to Section 4 or 5 before the Grantee Return Date, this
requirement shall be deemed to have been satisfied immediately before such
vesting.

9. No Right to Continued Employment.

Nothing in this Agreement or the Plan shall interfere with or limit in any way
the right of the Company or its Subsidiaries to terminate the Grantee’s
employment, nor confer upon the Grantee any right to continuance of employment
by the Company or any of its Subsidiaries or continuance of service as a Board
member.

10. Withholding of Taxes.

Prior to (i) the delivery to the Grantee (or the Grantee’s estate, if
applicable) of treasury Shares; or (ii) the delivery of cash to a broker to
purchase and deliver shares, pursuant to Sections 1 and 7 hereof, the Company
shall withhold from such Shares or cash, as the case may be, an amount of Shares
or cash having an aggregate Fair Market Value equal to the applicable income
taxes and other amounts as may be required by law to be withheld by the Company
with respect to the delivery of such Shares or cash.

11. Grantee Bound by the Plan.

The Grantee hereby acknowledges receipt of a copy of the Plan and agrees to be
bound by all the terms and provisions thereof.

12. Modification of Agreement.

This Agreement may be modified, amended, suspended or terminated, and any terms
or conditions may be waived, but only by a written instrument executed by the
Parties hereto.

13. Severability.

Should any provision of this Agreement be held by a court of competent
jurisdiction to be unenforceable or invalid for any reason, the remaining
provisions of this Agreement shall not be affected by such holding and shall
continue in full force in accordance with their terms.

14. Governing Law.

The validity, interpretation, construction and performance of this Agreement
shall be governed by the laws of the State of Ohio without giving effect to the
conflicts of laws principles thereof.

15. Successors in Interest.

This Agreement shall inure to the benefit of and be binding upon any successor
to the Company. This Agreement shall inure to the benefit of the Grantee’s legal
representatives. All obligations imposed upon the Grantee and all rights granted
to the Company under this Agreement shall be binding upon the Grantee’s heirs,
executors, administrators and successors.

16. Resolution of Disputes.

Any dispute or disagreement which may arise under, or as a result of, or in any
way relate to, the interpretation, construction or application of this Agreement
shall be determined by the Committee. Any determination made hereunder shall be
final, binding and conclusive on the Grantee, the Grantee’s heirs, executors,
administrators and successors, and the Company and its Subsidiaries for all
purposes.

 

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17. Entire Agreement.

This Agreement and the terms and conditions of the Plan constitute the entire
understanding between the Grantee and the Company and its Subsidiaries, and
supersede all other agreements, whether written or oral, with respect to the
Award.

18. Headings.

The headings of this Agreement are inserted for convenience only and do not
constitute a part of this Agreement.

19. Counterparts.

This Agreement may be executed simultaneously in two or more counterparts, each
of which shall constitute an original, but all of which taken together shall
constitute one and the same agreement.

<EXECUTION PAGE FOLLOWS>

 

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TIM HORTONS INC. (“Company”) By:  

 

Name:  

 

Title:  

 

 

  (“Employer”) By:  

 

Name:  

 

Title:  

 

GRANTEE

 

 

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