Exhibit 10.3
RESTRICTED STOCK AGREEMENT
     THIS RESTRICTED STOCK AGREEMENT (this “Agreement”) is made and entered into
by and between Encysive Pharmaceuticals Inc., a Delaware corporation (the
“Company”) and __________________, an individual (“Grantee”) on the ______day of
_________, 20___, (the “Grant Date”), pursuant to the Encysive Pharmaceuticals
Inc. 2007 Incentive Plan (the “Plan”). The Plan is incorporated by reference
herein in its entirety. Capitalized terms not otherwise defined in this
agreement shall have the meaning given to such terms in the Plan.
     WHEREAS, Grantee is an employee of the Company, and in connection
therewith, the Company desires to grant to Grantee a Restricted Stock Award for
____________ shares of the Company’s common stock, par value $.005 per share
(the “Common Stock”), subject to the terms and conditions of this Agreement,
with a view to increasing Grantee’s interest in the Company’s welfare and
growth; and
     WHEREAS, Grantee desires to have the opportunity to be a holder of shares
of the Company’s Common Stock subject to the terms and conditions of this
Agreement.
     NOW, THEREFORE, in consideration of the premises, mutual covenants and
agreements contained herein, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto,
intending to be legally bound hereby, agree as follows:
     1. Grant of Common Stock. Subject to the restrictions, forfeiture
provisions and other terms and conditions set forth herein (i) the Company
grants to Grantee ____________ (___) shares of Common Stock (“Grant Shares”),
and (ii) Grantee shall have and may exercise all rights and privileges of
ownership of such shares, including, without limitation, the voting rights of
such shares and the right to receive any dividends declared in respect thereof.
This Agreement is subject to, and the Company shall have the right to, require
Grantee to reimburse the Company for, or the Company may withhold from any
amounts which it may owe Grantee, all amounts required by applicable federal,
state and local law in respect of the issuance or vesting of the Grant Shares.
     2. Transfer Restrictions.
          (a) Generally. Grantee shall not sell, assign, transfer, exchange,
pledge, encumber, gift, devise, hypothecate or otherwise dispose of
(collectively, “Transfer”) any Grant Shares. The transfer restrictions imposed
by this Section 2 shall lapse as to approximately fifty percent (50%) of the
Grant Shares on _________, 20___, and _________, 20___, until all Grant Shares
are fully vested; provided, however, that, subject to Section 3, Grantee then
is, and continuously since the Grant Date has been, an employee of the Company.
The Grant Shares as to which such restrictions so lapse are referred to as
“Vested Shares.”

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[Based on the Grant Date, transfer restrictions will vest 50% on the lapse day
(“Lapse Day”) in each applicable lapse year (“Lapse Year”):

         
Grant Date
  Lapse Day   Lapse Year
March 1 — August 31
  May 31   Grant Year +2 yrs and +3 yrs
September 1 — December meeting of
  November 30   Grant Year +2 yrs and +3 yrs
     compensation committee
       
After December meeting of compensation
  November 30   Grant Year +1 yr and +2 yrs
     committee — last day of February]
       

          (b) Change in Control. If there is a Change in Control of the Company
(as defined in the Plan), the transfer restrictions of this Section 2 shall
automatically cease as of the effective date of such Change in Control, and all
the Grant Shares shall thereafter be 100 percent (100%) vested.
     3. Forfeiture.
          (a) Termination of Employment. Except as otherwise provided for
herein, if Grantee’s employment with the Company is terminated by the Company or
Grantee for any reason, then Grantee shall immediately forfeit all Grant Shares
which are not Vested Shares unless the Committee, in its discretion, determines
that any or all of such Grant Shares shall not be so forfeited; provided,
however, that if the employment of the Grantee is terminated by the Company
Without Cause (as defined below) or by the Grantee for Good Reason (as defined
below), then during the 12-month period after the date of termination for Good
Reason or Without Cause, all Grant Shares which are not Vested Shares shall
continue to vest in accordance with the terms hereof during said 12-month
period, and at the conclusion of said 12-month period, all Grant Shares which
are not Vested Shares will be fully vested and will become Vested Shares. For
purposes hereof, “Good Reason” and “Without Cause” shall have the meanings given
to such terms in that certain Termination Agreement dated _________, 20___,
entered into by the Grantee and the Company, which definitions are incorporated
herein by this reference.
          (b) Forfeited Shares. All shares of Common Stock forfeited hereunder
automatically shall revert to the Company and become canceled. Any
certificate(s) representing Grant Shares which include forfeited shares shall
only represent that number of Grant Shares which have not been forfeited
hereunder. Upon the Company’s request, Grantee agrees for himself and any other
holder(s) to tender to the Company any certificate(s) representing Grant Shares
which include forfeited shares for a new certificate representing the
unforfeited number of Grant Shares.
     4. Issuance of Certificate.
          (a) The Grant Shares may not be transferred until they become Vested
Shares. Further, the Vested Shares may not be sold or otherwise disposed of in
any manner which would constitute a violation of any applicable federal or state
securities laws in the opinion of counsel satisfactory to the Company. The
Company shall issue the shares in the name of the Grantee in

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“book-entry form” and held with the transfer agent that is responsible for
issuance of securities for the Company. The transferability of the shares shall
be restricted pursuant to the restrictions, terms and conditions (including
forfeiture and restrictions against transfer) contained herein and in the Plan.
A copy of the Plan and Agreement are on file in the office of the Secretary of
Encysive Pharmaceuticals Inc., 4848 Loop Central Drive, Suite 700, Houston,
Texas 77081. The transfer agent will be notified to place appropriate
designations on the “book entry” shares to reflect these restrictions on
transfer.
          (b) The shares issued pursuant to this Section 4, held in “book-entry”
form, together with the stock powers relating to the Grant Shares, shall be held
by the Company. The Company shall issue to the Grantee a receipt evidencing the
“book-entry” form of shares held by it.
     5. Miscellaneous.
          (a) Certain Transfers Void. Any purported Transfer of shares of Common
Stock in breach of any provision of this Agreement shall be void and
ineffectual, and shall not operate to Transfer any interest or title in the
purported transferee.
          (b) No Fractional Shares. All provisions of this Agreement concern
whole shares of Common Stock. If the application of any provision hereunder
would yield a fractional share, such fractional share shall be rounded down to
the next whole share if it is less than 0.5 and rounded up to the next whole
share if it is 0.5 or more.
          (c) Not an Employment or Service Agreement. This Agreement is not an
employment agreement, and this Agreement shall not be, and no provision of this
Agreement shall be construed or interpreted to create (i) any employment
relationship between Grantee and the Company or (ii) any agreement by the
Company to continue the directorship of the Grantee for any time period.
          (d) Notices. Any notice, instruction, authorization, request or demand
required hereunder shall be in writing, and shall be delivered either by
personal delivery, by telegram, telex, telecopy or similar facsimile means, by
certified or registered mail, return receipt requested, or by courier or
delivery service, addressed to the Company at the address indicated beneath its
signature on the execution page of this Agreement, and to Grantee at his address
indicated on the Company’s stock records, or at such other address and number as
a party shall have previously designated by written notice given to the other
party in the manner hereinabove set forth. Notices shall be deemed given when
received, if sent by facsimile means (confirmation of such receipt by confirmed
facsimile transmission being deemed receipt of communications sent by facsimile
means); and when delivered and receipted for (or upon the date of attempted
delivery where delivery is refused), if hand-delivered, sent by express courier
or delivery service, or sent by certified or registered mail, return receipt
requested.
          (e) Amendment and Waiver. This Agreement may be amended, modified or
superseded only by written instrument executed by the Company and Grantee. Any
waiver of the terms or conditions hereof shall be made only by a written
instrument executed and delivered

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by the party waiving compliance. Any waiver granted by the Company shall be
effective only if executed and delivered by a duly authorized executive officer
of the Company other than Grantee. The failure of any party at any time or times
to require performance of any provisions hereof, shall in no manner effect the
right to enforce the same. No waiver by any party of any term or condition, or
the breach of any term or condition contained in this Agreement in one or more
instances shall be deemed to be, or construed as, a further or continuing waiver
of any such condition or breach or a waiver of any other condition or the breach
of any other term or condition.
          (f) Governing Law and Severability. This Agreement shall be governed
by the internal laws, and not the laws of conflict, of the State of Texas. The
invalidity of any provision of this Agreement shall not affect any other
provision of this Agreement, which shall remain in full force and effect.
          (g) Successors and Assigns. Subject to the limitations which this
Agreement imposes upon transferability of shares of Common Stock, this Agreement
shall bind, be enforceable by and inure to the benefit of the Company and its
successors and assigns, and Grantee, and Grantee’s permitted assigns and upon
death, estate and beneficiaries thereof (whether by will or the laws of descent
and distribution), executors, administrators, agents, legal and personal
representatives.
[SIGNATURE PAGE FOLLOWS]

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     IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
on the date first above written.

              COMPANY:
 
       
 
  ENCYSIVE PHARMACEUTICALS INC.
 
       
 
  By:    
 
       
 
       
 
  Name:    
 
       
 
       
 
  Title:  
 
       
 
       
 
  Address:   Encysive Pharmaceuticals Inc.
 
      4848 Loop Central Drive, Suite 700
 
      Houston, Texas 77081
 
            Facsimile No.: (713) 796-8232
 
            Attention: Chief Executive Officer
 
       
 
            GRANTEE:
 
                      Signature
 
                        Printed Name
 
       
 
            GRANTEE’S SPOUSE:
 
                        Signature
 
                        Printed Name

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