(Form) FINANCIAL-PERFORMANCE BASED


RESTRICTED STOCK GRANT AGREEMENT (2014)


 


THIS AGREEMENT,
made as of February 20, 2014 (the “Grant Date”), between MDC Partners Inc., a Canadian corporation (the
“Corporation”), and _______ (the “Grantee”).


 


WHEREAS, the Corporation
has adopted the 2005 Stock Incentive Plan (the “Plan”) for the purpose of providing employees and consultants
of the Corporation and eligible non-employee directors of the Corporation’s Board of Directors a proprietary interest in
pursuing the long-term growth, profitability and financial success of the Corporation (except as otherwise expressly set forth
herein, capitalized terms used in this Agreement shall have the definitions set forth in the Plan).


 


WHEREAS, the Human
Resources & Compensation Committee (the “Committee”) of the Board of Directors has determined that it is
in the best interests of the Corporation to make the award set forth herein, which award will vest upon achievement by the Corporation
of specified financial growth target during the calendar year 2014 and/or 2015.


 


WHEREAS, pursuant
to the Plan, the Committee has determined to grant an Other Stock-Based Award to the Grantee in the form of shares of Class A subordinate
voting shares, subject to the terms, conditions and limitations provided herein, including achievement of financial performance
targets, and in the Plan (the “Restricted Stock” or “2014 Restricted Stock Award”);


 


NOW, THEREFORE, the
parties hereto agree as follows:


 


1.           Grant of Restricted Stock.


 


1.1          The Corporation
hereby grants to the Grantee, on the terms and conditions set forth in this Agreement, the number of shares of Restricted Stock
set forth under the Grantee's name on the signature page hereto (the “2014 Restricted Stock Award”).


 


1.2          The Grantee's
rights with respect to all the shares of Restricted Stock underlying the 2014 Restricted Stock Award shall not vest and will remain
forfeitable at all times prior to the Vesting Date (as defined below). At any time, reference to the 2014 Restricted Stock Award
shall be deemed to be a reference to the Restricted Shares granted under Section 1.1 that have neither vested nor been forfeited
pursuant to the terms of this Agreement.


 


1.3          This Agreement
shall be construed in accordance with, and subject to, the terms of the Plan (the provisions of which are incorporated herein by
reference).


 


2.            Rights of Grantee.


 


Except as otherwise
provided in this Agreement, the Grantee shall be entitled, at all times on and after the Grant Date, to exercise all rights of
a shareholder with respect to the 2014 Restricted Stock Award, including the right to vote the shares of Restricted Stock. Prior
to the Vesting Date, the Grantee shall not be entitled to transfer, sell, pledge, hypothecate or assign any portion of the 2014
Restricted Stock Award (collectively, the “Transfer Restrictions”).


 



    	 



    	 



    

 


3.           Vesting; Lapse of Restrictions.


 


3.1         The 2014 Restricted
Stock Award shall not vest, and the Transfer Restrictions shall not lapse, unless the Corporation achieves the Performance Measure(s)
on the dates set forth in Section 3.3(a) (the “Vesting Date(s)”), and the Grantee continues to be serving
as an employee of the Corporation on such Vesting Date; provided, that the 2014 Restricted Stock Award shall vest, and the
Transfer Restrictions with respect to all the shares of the 2014 Restricted Stock Award shall lapse, if sooner, on the date of
any one of the following “Permitted Acceleration Events”: (i) the occurrence of a Change in Control (as defined
in the Plan); (ii) the Grantee’s employment is terminated by the Corporation (other than for “cause”), or by
the employee for “good reason” (as each such term may be defined in the Grantee’s underlying employment agreement);
or (iii) the Grantee’s death or disability.


 


3.2         Notwithstanding
anything in this Agreement to the contrary, upon (i) any termination of a Grantee for Cause or (ii) the failure by the Corporation
to achieve the 2014-2015 Performance Measures, the 2014 Restricted Stock Award shall be forfeited and automatically transferred
to and reacquired by the Corporation at no cost to the Corporation, and neither the Grantee nor any heirs, executors, administrators
or successors of such Grantee shall thereafter have any right or interest in such shares of Restricted Stock.


 


3.3          For
purposes of the foregoing, the following terms shall have the following meanings:


 


(a)          “2014-2015
Performance Measures” means the achievement by the Corporation of EBITDA in the following amounts during the specified
Performance Period (as defined in the Plan):


 


(i)          2014
Target. In the event that the Corporation achieves EBITDA for the twelve-months ended December 31, 2014, in an amount equal
to not less than the product of 2013 EBITDA (as defined below) multiplied by 1.05 (the “2014 Target”), then
100% of the 2014 Restricted Stock Award will vest on March 1, 2015.


 


(ii)         2014/2015
Cumulative Target. In the event that the Corporation did not achieve the 2014 Target but achieves EBITDA for the two (2) years
ended December 31, 2015, in an amount equal to not less than the sum of (i) the 2014 Target, plus (ii) the product of the 2014
Target multiplied by 1.10 (such sum, the “2014/2015 Cumulative Target”), then 100% of the 2014 Restricted Stock
Award will vest on March 1, 2016 (but only to the extent not previously vested).


 


(iii)        2014
Restricted Stock Award Limit. In no event shall the Grantee be vested or otherwise entitled to more than one hundred percent
(100%) of the shares of Restricted Stock granted as part of the 2014 Restricted Stock Award pursuant to section 1.1 above.


 


(b)          “Cause”
means the Grantee’s termination by reason of (i) his/her continued or willful failure substantially to perform his/her duties
for the Corporation, (ii) his/her willful and serious misconduct in connection with the performance of his/her duties for the Corporation,
(iii) the Grantee’s conviction of, or entering a plea of guilty to, a crime that constitutes a felony or a crime involving
moral turpitude, (iv) his/her fraudulent or dishonest conduct or (v) his/her material breach of any of his/her obligations or covenants
under any written policies of the Corporation or any written agreement between such Grantee and the Corporation.


 



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(c)          “Change
in Control” shall have the meaning set forth in Section 2(b) of the Plan, provided that the reference to “twenty-five
percent (25%) or more of the combined voting power of MDC's then outstanding voting securities” in Section 2(b)(i) of the
Plan shall, for purposes of this 2014 Restricted Stock Award, be amended to read “fifty percent (50%) or more of the combined
voting power of MDC's then outstanding voting securities”; and, provided further, that the reference in Section 2(b)(iii)(A)(III)(3)
to “twenty five percent (25%) or more of the combined voting power of the Surviving Corporation’s voting securities
outstanding immediately following such transaction” shall, for purposes of this 2014 Restricted Stock Award, be amended to
read “fifty percent (50%) or more of the combined voting power of the Surviving Corporation’s voting securities outstanding
immediately following such transaction”.


 


(d)          “Disability”
shall mean a mental or physical condition of the Grantee rendering him unable to perform his/her duties for the Corporation for
a period of six (6) consecutive months or for 180 days within any consecutive 365-day period and which is reasonably expected to
continue indefinitely; provided that if, as of the date of determination, the Grantee is a party to an effective employment
agreement with a different definition of “Disability” or any derivation of such term, the definition of “Disability”
(or its derivation) contained in such employment agreement shall be substituted for the definition set forth above for all purposes
hereunder.


 


(e)          “EBITDA”
shall mean the Corporation’s share of consolidated earnings before
interest, taxes, depreciation and amortization, plus stock-based compensation, acquisition deal costs, deferred acquisition consideration
adjustments, and one time incentive and profit distributions from affiliates.


 


(f)          “2013
EBITDA” shall mean the Corporation’s EBITDA for the year ended December 31, 2013, as determined by the Compensation
Committee following completion of Corporation’s audited financial statements for the year ended December 31, 2013.


 


4.           Escrow
and Delivery of Shares.


 


4.1          Certificates (or
an electronic "book entry" on the books of the Corporation's stock transfer agent) representing the shares of Restricted
Stock shall be issued and held by the Corporation (or its stock transfer agent) in escrow (together with any stock transfer powers
which the Corporation may request of Grantee) and shall remain in the custody of the Corporation (or its stock transfer agent)
until (i) their delivery to the Grantee as set forth in Section 4.2 hereof, or (ii) their forfeiture and transfer to the Corporation
as set forth in Section 3.2 hereof. The appointment of an independent escrow agent shall not be required.


 


4.2          (a)           Certificates (or an electronic "book entry") representing those shares of Restricted Stock in respect of which the
Transfer Restrictions have lapsed pursuant to Section 3.1 hereof shall be delivered to the Grantee as soon as practicable following
the Vesting Date.


 



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(b)          The
Grantee, or the executors or administrators of the Grantee's estate, as the case may be, may receive, hold, sell or otherwise dispose
of those shares of Restricted Stock delivered to him or her pursuant to this Section 4.2 free and clear of the Transfer Restrictions,
but subject to compliance with all federal and state securities laws.


 


4.3          (a)          Each stock certificate
issued pursuant to Section 4.1 shall bear a legend in substantially the following form:


 


This
certificate and the shares of stock represented hereby are subject to the terms and conditions applicable to Restricted Stock contained
in the 2005 Stock Incentive Plan (the "Plan") and a Restricted Stock Agreement (the "Agreement") between the
Corporation and the registered owner of the shares represented hereby. Release from such terms and conditions shall be made only
in accordance with the provisions of the Plan(s) and the Agreement, copies of which are on file in the office of the Secretary
of the Corporation.


 


(b)          As soon as practicable following
a Vesting Date, the Corporation shall issue a new certificate (or electronic "book entry") for shares of the Restricted
Stock which have become non-forfeitable in relation to such Vesting Date, which new certificate (or electronic "book entry")
shall not bear the legend set forth in paragraph (a) of this Section 4.3 and shall be delivered in accordance with Section 4.2
hereof.


 


5.           Dividends.
All dividends declared and paid by the Corporation on shares underlying the 2014 Restricted Stock Award shall be deferred until
the lapsing of the Transfer Restrictions pursuant to Section 3.1 and shall be distributed only to the extent the underlying shares
of Restricted Stock vest and are distributed in accordance with Section 3. The deferred dividends shall be held by the Corporation
for the account of the Grantee until the Vesting Date, at which time the dividends, with no interest thereon, shall be paid to
the Grantee or her/his estate, as the case may be. Upon the forfeiture of the shares of Restricted Stock pursuant to Section 3,
any deferred dividends shall also be forfeited to the Corporation.


 


6.           No Right
to Continued Retention. Nothing in this Agreement or the Plan shall be interpreted or construed to confer upon the Grantee
any right with respect to continuance as an employee, nor shall this Agreement or the Plan interfere in any way with the right
of the Corporation to terminate the Grantee's service as an employee at any time.


 


7.           Adjustments
Upon Change in Capitalization. If, by operation of Section 10 of the Plan, the Grantee shall be entitled to new, additional
or different shares of stock or securities of the Corporation or any successor corporation or entity or other property, such new,
additional or different shares or other property shall thereupon be subject to all of the conditions and restrictions which were
applicable to the shares of Restricted Stock immediately prior to the event and/or transaction that gave rise to the operation
of Section 10 of the Plan.


 



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8.           Modification
of Agreement; Adjustment of Performance Measures by the Committee. Except as set forth in the Plan and herein, 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. Notwithstanding the foregoing, the Committee shall adjust the 2014 Performance Measure in the event
that the Corporation acquires or disposes any material assets or business.


 


9.           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 and effect in
accordance with their terms.


 


10.         Governing
Law. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the
State of New York without regard to its conflict of laws principle, except to the extent that the application of New York law would
result in a violation of the Canadian Business Corporation Act.


 


11.         Successors
in Interest. This Agreement shall inure to the benefit of and be binding upon any successor to the Corporation. This Agreement
shall inure to the benefit of the Grantee's heirs, executors, administrators and successors. All obligations imposed upon the Grantee
and all rights granted to the Corporation under this Agreement shall be binding upon the Grantee's heirs, executors, administrators
and successors.


 


	MDC PARTNERS INC.	 
	 	 	 
	By:	                  	 
	Name:   Michael Sabatino	 
	Title:     Chief Accounting Officer	 


 


	MDC PARTNERS INC.	 
	 	 	 
	By:	                	 
	Name:  Mitchell Gendel	 
	Title:    General Counsel	 


 


	GRANTEE:  ___________	 
	 	 	 
	By:	                               	 
	Name:	 


 


Number of Shares of Restricted


Stock Hereby Granted: ______


 



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