Exhibit 10.2

 

DITECH NETWORKS, INC.

2006 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT GRANT NOTICE

 

Ditech Networks, Inc. (the “Company”) hereby awards to Participant the number of
restricted stock units specified and on the terms set forth below (the
“Award”).  The Award is subject to all of the terms and conditions as set forth
herein and in the Company’s 2006 Equity Incentive Plan (the “Plan”) and the
Restricted Stock Unit Agreement (the “Award Agreement”), both of which are
attached hereto and incorporated herein in their entirety.  Capitalized terms
not explicitly defined herein but defined in the Plan or the Award Agreement
shall have the meanings set forth in the Plan or the Award Agreement.  Except as
explicitly provided herein or in the Award Agreement, in the event of any
conflict between the terms in the Award and the Plan, the terms of the Plan
shall control.

 

Participant:

 

 

Date of Grant:

 

 

Vesting Commencement Date:

 

 

Number of Restricted Stock Units:

 

 

Consideration:

Participant’s Services

 

 

Vesting Schedule:                   
                                                                                                                       . 
 

Notwithstanding the foregoing, vesting shall terminate upon the Participant’s
termination of Continuous Service.

 

Issuance Schedule:               One share of Common Stock will be issued for
each restricted stock unit which vests on an applicable vesting date, subject to
the provisions of Section 3 of the Award Agreement.

 

Dividends:                                                              
Participant shall receive dividend equivalent rights in respect of the
restricted stock units covered by this Award, subject to the provisions of
Section 4 of the Award Agreement.

 

Additional Terms/Acknowledgements:  The undersigned Participant acknowledges
receipt of, and understands and agrees to, this Restricted Stock Unit Grant
Notice, the Award Agreement, the Plan prospectus, ,the Plan and the Company’s
Insider Trading Policy.  Participant further acknowledges that as of the Date of
Grant, this Restricted Stock Unit Grant Notice, the Award Agreement and the Plan
set forth the entire understanding between Participant and the Company regarding
the Award and supersedes all prior oral and written agreements on that subject,
with the exception of: (i) if applicable to Participant, (A) the terms of any
written offer letter or employment agreement entered into between the Company
and Participant that specifically provides for accelerated vesting of
compensatory equity awards and (B) the Company’s change of control severance
plan, or (ii) any compensation recovery policy that is adopted by the Company or
is otherwise required by applicable law.  By accepting this Award, you consent
to receive Plan documents by electronic delivery and to participate in the Plan
through an on-line or electronic system established and maintained by the
Company or another third party designated by the Company.

 

 

DITECH NETWORKS, INC.

 

PARTICIPANT:

 

 

 

 

 

 

By:

 

 

 

Signature

 

Signature

 

 

 

Title:

 

 

Date:

 

 

 

 

 

Date:

 

 

 

 

ATTACHMENTS:                Award Agreement, 2006 Equity Incentive Plan

 

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DITECH NETWORKS, INC.

2006 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT AGREEMENT

 

Pursuant to the Restricted Stock Unit Grant Notice (“Grant Notice”) and this
Restricted Stock Unit Award Agreement (“Agreement”), Ditech Networks, Inc. (the
“Company”) has awarded you a Restricted Stock Unit Award pursuant to
Section 7(c) of the Company’s 2006 Equity Incentive Plan (the “Plan”) for the
number of Restricted Stock Units as indicated in the Grant Notice (collectively,
the “Award”).  Defined terms not explicitly defined in this Agreement but
defined in the Plan shall have the same definitions as in the Plan.  Except as
otherwise explicitly provided herein, in the event of any conflict between the
terms in this Agreement and the Plan, the terms of the Plan shall control.

 

The details of your Award, in addition to those set forth in the Grant Notice,
are as follows.

 

1.             NUMBER OF RESTRICTED STOCK UNITS AND SHARES OF COMMON STOCK.  The
number of Restricted Stock Units in your Award is set forth in the Grant Notice.

 

(a)           The number of Restricted Stock Units subject to your Award may be
adjusted from time to time for capitalization adjustments as described in
Section 11(a) of the Plan.

 

(b)           Any additional Restricted Stock Units, cash or other property that
become subject to the Award pursuant to this Section 1 or Section 4 shall be
subject, in a manner determined by the Board, to the same forfeiture
restrictions, restrictions on transferability, and time and manner of delivery
as applicable to the other Restricted Stock Units covered by your Award.

 

(c)           Notwithstanding the provisions of this Agreement, no fractional
shares or rights for fractional shares of Common Stock shall be created pursuant
to this Section 1 or Section 4.  The Board shall, in its discretion, determine
an equivalent benefit for any fractional shares that might be created by the
adjustments referred to in this Agreement.

 

2.             VESTING.  Subject to the limitations contained herein, your Award
will vest, if at all, in accordance with the vesting schedule provided in the
Grant Notice, provided that vesting will cease upon the termination of your
Continuous Service.  Any Restricted Stock Units and Dividend Equivalent Rights
(defined below) that have not yet vested shall be forfeited upon the termination
of your Continuous Service.

 

3.             DISTRIBUTION OF SHARES OF COMMON STOCK.

 

(a)           Subject to the provisions of this Agreement and the Plan, in the
event one or more Restricted Stock Units vests, the Company shall deliver to you
one (1) share of Common Stock for each Restricted Stock Unit that vests.  Except
as set forth below, the delivery to you of the appropriate number of vested
shares of Common Stock shall be made on the applicable

 

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vesting date (the “Issuance Date”).  If the Issuance Date falls on a date that
is not a business day, delivery shall instead occur on the next following
business day. The form of such delivery (e.g., a stock certificate or electronic
entry evidencing such shares) shall be determined by the Company.

 

(b)           Notwithstanding the foregoing, if (i) the Issuance Date does not
occur (1) during an “open window period” applicable to you, as determined by the
Company in accordance with the Company’s then-effective policy on trading in
Company securities, or (2) on a date when you are otherwise permitted to sell
shares of Common Stock on an established stock exchange or stock market, and
(ii) the Company elects, prior to the Issuance Date, (1) not to satisfy the tax
withholding obligations described in Section 11 by withholding shares of Common
Stock from the shares otherwise due, on the Issuance Date, to you under this
Agreement, and (2) not to permit you to enter into a “same day sale” commitment
with a broker-dealer pursuant to Section 11 of this Agreement (including but not
limited to a commitment under a previously established Company-approved 10b5-1
trading plan), then such shares shall not be delivered on such Issuance Date and
shall instead be delivered on the first business day of the next occurring open
window period applicable to you or the next business day when you are not
prohibited from selling shares of the Company’s Common Stock in the open public
market, but in no event later than December 31 of the calendar year in which the
Issuance Date occurs (that is, the last day of your taxable year in which the
Issuance Date occurs), or, if permitted in a manner that complies with Treasury
Regulation Section 1.409A-1(b)(4), in no event later than the date that is the
15th day of the third calendar month of the year following the year in which the
shares of Common Stock under this Agreement are no longer subject to a
“substantial risk of forfeiture” within the meaning of Treasury Regulation
Section 1.409A-1(d).

 

(c)           To the extent the terms of your Award (or another written
agreement between you and the Company) provides that it will be settled upon a
termination of employment or separation from service (as such term is defined in
Code Section 409A(a)(2)(A)(i), and without regard to any alternative definition,
a “Separation from Service”), such severance benefit does not satisfy the
requirements for an exemption from application of Code Section 409A, and you are
subject to the distribution limitations contained in Section 409A applicable to
“specified employees,” as defined in Section 409A(a)(2)(B)(i) of the Code, then
the shares of Common Stock otherwise issuable on the Issuance Date shall not be
issued before the date that is six (6) months following the date of your
Separation From Service, or, if earlier, the date of your death that occurs
within such six month period.

 

(d)           Each installment of Restricted Stock Units that vests hereunder is
intended to constitute a “separate payment” for purposes of Treasury Regulation
Section 1.409A-2(b)(2).

 

4.             DIVIDEND EQUIVALENT RIGHTS.  You shall receive dividend
equivalent rights in respect of the Restricted Stock Units covered by this Award
at the time of any payment of a dividend or other distribution on a share of
Common Stock, where such dividend has a record date between the Date of Grant
indicated on your Grant Notice and the date the corresponding shares are issued
in respect of your vested Restricted Stock Units (the “Dividend Equivalent
Rights”).  In the case of a cash dividend (or dividend of property other than
shares of Common Stock) paid on shares of the Company’s Common Stock, the
Restricted Stock Units will be credited with Dividend Equivalent Rights by
multiplying the dividend paid per share by the

 

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number of Restricted Stock Units (including previously credited Dividend Units)
outstanding and unpaid on the date the dividend is declared.  In the case of a
stock dividend, you will automatically be granted a corresponding number of
additional Restricted Stock Units subject to the Award (the “Dividend Units”). 
The Dividend Equivalent Rights shall be subject to the same forfeiture
restrictions and restrictions on transferability, and the same timing
requirements for issuance of shares, as apply to the Restricted Stock Units
subject to the Award with respect to which the Dividend Equivalent Rights
relate, and shall be paid at the same time that the corresponding shares are
issued in respect of your vested Restricted Stock Units.

 

5.             PAYMENT BY YOU.  This Award was granted in consideration of your
services to the Company.  Subject to Section 11 below, except as otherwise
provided in the Grant Notice or under applicable law, you will not be required
to make any payment to the Company (other than your past and future services
with the Company) with respect to your receipt of the Award, vesting of the
Restricted Stock Units, or the delivery of the shares of Common Stock underlying
the Restricted Stock Units.

 

6.             SECURITIES LAW COMPLIANCE.  You may not be issued any Common
Stock under your Award unless the shares of Common Stock are either (i) then
registered under the Securities Act, or (ii) the Company has determined that
such issuance would be exempt from the registration requirements of the
Securities Act.  Your Award must also comply with other applicable laws and
regulations governing the Award, and you shall not receive such Common Stock if
the Company determines that such receipt would not be in material compliance
with such laws and regulations.

 

7.             RESTRICTIVE LEGENDS.  The Common Stock issued under your Award
shall be endorsed with appropriate legends, if any, determined by the Company.

 

8.             TRANSFER RESTRICTIONS.  Your Award is not transferable, except by
will or by the laws of descent and distribution.  Prior to the time that shares
of Common Stock have been delivered to you, you may not transfer, pledge, sell
or otherwise dispose of the shares in respect of your Award.  For example, you
may not use shares that may be issued in respect of your Award as security for a
loan, nor may you transfer, pledge, sell or otherwise dispose of such shares. 
Notwithstanding the foregoing, by delivering written notice to the Company, in a
form satisfactory to the Company, you may designate a third party who, in the
event of your death, shall thereafter be entitled to receive any distribution of
Common Stock pursuant to this Agreement.  In the event of divorce, you are
encouraged to discuss the proposed treatment of the Restricted Stock Units with
the Company prior to finalizing any domestic relations order.

 

9.             AWARD NOT A SERVICE CONTRACT.  Your Award is not an employment or
service contract, and nothing in your Award shall be deemed to create in any way
whatsoever any obligation on your part to continue in the service of the Company
or any Affiliate, or on the part of the Company or any Affiliate to continue
such service.  In addition, nothing in your Award shall obligate the Company or
any Affiliate, their respective stockholders, boards of directors or employees
to continue any relationship that you might have as an Employee or Consultant of
the Company or any Affiliate.

 

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10.          UNSECURED OBLIGATION.  Your Award is unfunded, and even as to any
Restricted Stock Units which vest, you shall be considered an unsecured creditor
of the Company with respect to the Company’s obligation, if any, to issue Common
Stock pursuant to this Agreement.  You shall not have voting or any other rights
as a stockholder of the Company with respect to the Common Stock acquired
pursuant to this Agreement until such Common Stock is issued to you pursuant to
Section 2 of this Agreement.  Upon such issuance, you will obtain full voting
and other rights as a stockholder of the Company with respect to the Common
Stock so issued.  Nothing contained in this Agreement, and no action taken
pursuant to its provisions, shall create or be construed to create a trust of
any kind or a fiduciary relationship between you and the Company or any other
person.

 

11.          WITHHOLDING OBLIGATIONS.

 

(a)           On or before the time you receive a distribution pursuant to your
Award, or at any time thereafter as requested by the Company, you hereby
authorize any required withholding from the Common Stock or cash Dividend
Equivalent Right issuable to you and/or otherwise agree to make adequate
provision in cash for any sums required to satisfy the federal, state, local and
foreign tax withholding obligations of the Company or any Affiliate which arise
in connection with your Award (the “Withholding Taxes”).  Additionally, the
Company may, in its sole discretion, satisfy all or any portion of the
Withholding Taxes obligation relating to your Award by any of the following
means or by a combination of such means: (i) withholding from any compensation
otherwise payable to you by the Company; (ii) causing you to tender a cash
payment; (iii) permitting or requiring you to enter into a “same day sale”
commitment with a broker-dealer that is a member of the Financial Industry
Regulatory Authority whereby you irrevocably elect to sell a portion of the
shares to be delivered in connection with your Restricted Stock Units to satisfy
the Withholding Taxes and whereby the FINRA Dealer irrevocably commits to
forward the proceeds necessary to satisfy the Withholding Taxes directly to the
Company and/or its Affiliates; or (iv) withholding shares of Common Stock from
the shares of Common Stock issued or otherwise issuable to you in connection
with the Award with a Fair Market Value (measured as of the date shares of
Common Stock are issued to pursuant to Section 6) equal to the amount of such
Withholding Taxes; provided, however, that the number of such shares of Common
Stock so withheld shall not exceed the amount necessary to satisfy the Company’s
required tax withholding obligations using the minimum statutory withholding
rates for federal, state, local and foreign tax purposes, including payroll
taxes, that are applicable to supplemental taxable income.

 

(b)           Unless the tax withholding obligations of the Company and/or any
Affiliate are satisfied, the Company shall have no obligation to deliver to you
any Common Stock.

 

(c)           In the event the Company’s obligation to withhold arises prior to
the delivery to you of Common Stock or it is determined after the delivery of
Common Stock to you that the amount of the Company’s withholding obligation was
greater than the amount withheld by the Company, you agree to indemnify and hold
the Company harmless from any failure by the Company to withhold the proper
amount.

 

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12.          NOTICES.  Any notices provided for in your Award or the Plan shall
be given in writing and shall be deemed effectively given upon receipt or, in
the case of notices delivered by the Company to you, five (5) days after deposit
in the United States mail, postage prepaid, addressed to you at the last address
you provided to the Company.  Notwithstanding the foregoing, the Company may, in
its sole discretion, decide to deliver any documents related to participation in
the Plan and this Award by electronic means or to request your consent to
participate in the Plan by electronic means.  By accepting this Award you
consent to receive such documents by electronic delivery and, if requested, to
agree to participate in the Plan through an on-line or electronic system
established and maintained by the Company or another third party designated by
the Company.

 

13.          HEADINGS.  The headings of the Sections in this Agreement are
inserted for convenience only and shall not be deemed to constitute a part of
this Agreement or to affect the meaning of this Agreement.

 

14.          AMENDMENT.  This Agreement may be amended only by a writing
executed by a duly authorized representative of the Company and you which
specifically states that it is amending this Agreement. Notwithstanding the
foregoing, this Agreement may be amended solely by the Board by a writing which
specifically states that it is amending this Agreement, so long as a copy of
such amendment is delivered to you, and provided that no such amendment
adversely affecting your rights hereunder may be made without your written
consent. Without limiting the foregoing, the Company reserves the right to
change, by written notice to you, the provisions of this Agreement in any way it
may deem necessary or advisable to carry out the purpose of the grant as a
result of any change in applicable laws or regulations or any future law,
regulation, ruling, or judicial decision, provided that any such change shall be
applicable only to rights relating to that portion of the Award which is then
subject to restrictions as provided herein.

 

15.          MISCELLANEOUS.

 

(a)           The rights and obligations of the Company under your Award shall
be transferable by the Company to any one or more persons or entities, and all
covenants and agreements hereunder shall inure to the benefit of, and be
enforceable by the Company’s successors and assigns.

 

(b)           All obligations of the Company under the Plan and this Agreement
shall be binding on any successor to the Company, whether the existence of such
successor is the result of a direct or indirect purchase, merger, consolidation,
or otherwise, of all or substantially all of the business and/or assets of the
Company.

 

(c)           You agree upon request to execute any further documents or
instruments necessary or desirable in the sole determination of the Company to
carry out the purposes or intent of your Award.

 

(d)           You acknowledge and agree that you have reviewed your Award in its
entirety, have had an opportunity to obtain the advice of counsel prior to
executing and accepting your Award and fully understand all provisions of your
Award.

 

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(e)           This Agreement shall be subject to all applicable laws, rules, and
regulations, and to such approvals by any governmental agencies or national
securities exchanges as may be required.

 

16.          GOVERNING PLAN DOCUMENT.  Your Award is subject to all the
provisions of the Plan, the provisions of which are hereby made a part of your
Award, and is further subject to all interpretations, amendments, rules and
regulations which may from time to time be promulgated and adopted pursuant to
the Plan.  In the event of any conflict between the provisions of your Award and
those of the Plan, the provisions of the Plan shall control; provided, however,
that Section 3 of this Agreement shall govern the timing of any distribution of
Common Stock under your Award.  No member of the Board shall be personally
liable for any action, determination, or interpretation made in good faith with
respect to the Plan or this Agreement.  In addition, your Award (and any
compensation paid or shares issued under your Award) is subject to recoupment in
accordance with The Dodd—Frank Wall Street Reform and Consumer Protection Act
and any implementing regulations thereunder, any clawback policy adopted by the
Company and any compensation recovery policy otherwise required by applicable
law.

 

17.          COMPLETE AGREEMENT.  You hereby acknowledge that as of the date of
grant of your Award, the Grant Notice, this Agreement, and the Plan set forth
the entire understanding between you and the Company regarding the acquisition
of Common Stock pursuant to this Award, and supersede all prior oral and written
agreements on this subject with the exception of stock awards previously granted
and delivered to you under the Plan.

 

18.          EFFECT ON OTHER EMPLOYEE BENEFIT PLANS.  The value of the Award
subject to this Agreement shall not be included as compensation, earnings,
salaries, or other similar terms used when calculating benefits under any
employee benefit plan (other than the Plan) sponsored by the Company or any
Affiliate except as such plan otherwise expressly provides. The Company
expressly reserves its rights to amend, modify, or terminate any or all of the
employee benefit plans of the Company or any Affiliate.

 

19.          CHOICE OF LAW.  The interpretation, performance and enforcement of
this Agreement shall be governed by the law of the state of California without
regard to such state’s conflicts of laws rules.

 

20.          SEVERABILITY.  If all or any part of this Agreement or the Plan is
declared by any court or governmental authority to be unlawful or invalid, such
unlawfulness or invalidity shall not invalidate any portion of this Agreement or
the Plan not declared to be unlawful or invalid. Any Section of this Agreement
(or part of such a Section) so declared to be unlawful or invalid shall, if
possible, be construed in a manner which will give effect to the terms of such
Section or part of a Section to the fullest extent possible while remaining
lawful and valid.

 

21.          OTHER DOCUMENTS.  You hereby acknowledge receipt or the right to
receive a document providing the information required by
Rule 428(b)(1) promulgated under the Securities Act.

 

* * * * *

 

This Restricted Stock Unit Award Agreement shall be deemed to be signed by the
Company and the Participant upon the signing by the Participant of the
Restricted Stock Unit Grant Notice to which it is attached.

 

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