Exhibit 10.1


 


FIVE STAR QUALITY CARE, INC.


 


RESTRICTED SHARE AGREEMENT


 


This
Restricted Share Agreement (this “Agreement”) is made as of                               ,
between                               
(the “Recipient”) and Five Star Quality Care, Inc. (the “Company”).


 


In
consideration of the mutual promises and covenants contained in this Agreement,
and for other valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:


 


1.             Grant of Shares.  The Company hereby grants to the Recipient,
effective as of the date of this Agreement,           
shares of its common shares.  The shares
so granted are hereinafter referred to as the “Shares,” which term shall also
include any shares of the Company issued to the Recipient by virtue of his or
her ownership of the Shares, by share dividend, share split, recapitalization
or otherwise.


 


2.             Vesting; Repurchase of Shares.


 


(a)           The Shares shall
vest one-fifth as of the date hereof, a further one-fifth on the first
anniversary of the date of this Agreement, a further one-fifth on the second
anniversary of the date of this Agreement, a further one-fifth on the third
anniversary of the date of this Agreement and the final one-fifth on the fourth
anniversary of the date of this Agreement. 
Any Shares not vested as of any date are herein referred to as “Unvested
Shares.”


 


(b)           In the event the
Recipient ceases to render significant services, whether as an employee or
otherwise, to (i) the Company, (ii) the entity which is the manager
or shared services provider to the Company or an entity controlled by, under
common control with or controlling such entity (collectively, the “Manager”),
or (iii) an affiliate of the Company (which shall be deemed for such
purpose to include any other entity to which the Manager is the manager or
shared services provider), the Company shall have the right and option to
purchase from the Recipient, for an amount equal to $.01 per share (as adjusted
for any share split or combination, share dividend, recapitalization or similar
event) all or any portion of the Unvested Shares as of the date the Recipient
ceases to render such services.  The
Company may exercise such purchase option by delivering or mailing to the
Recipient (or his or her estate), at any time after the Recipient has ceased to
render such services, a written notice of exercise of such option.  Such notice shall specify the number of
Unvested Shares to be purchased.  The
price to be paid for the Unvested Shares to be repurchased may be payable, at
the option of the Company, by wire transfer of immediately available funds or
in cash (by check) or any other reasonable method.


 

















 


3.             Legends.  Each certificate or share statement relating
to the Shares shall prominently bear legends in substantially the following
terms:


 


“THE SHARES EVIDENCED BY THIS CERTIFICATE WERE ISSUED PURSUANT TO AN
INCENTIVE PLAN MAINTAINED BY THE CORPORATION. 
THESE SHARES MAY BE SUBJECT TO TRANSFER AND/OR VESTING
RESTRICTIONS, AND UNVESTED SHARES ARE SUBJECT TO REPURCHASE RIGHTS CONTAINED IN
THE PLAN, THE RELATED GRANT OF SHARES OR AN AGREEMENT BETWEEN THE CORPORATION
AND THE INITIAL HOLDER OF THESE SHARES. 
A COPY OF APPLICABLE RESTRICTIONS AND REPURCHASE RIGHTS WILL BE
FURNISHED TO THE HOLDER OF THIS CERTIFICATE WITHOUT CHARGE UPON REQUEST TO THE
SECRETARY OF THE CORPORATION.”


 


Certificates
evidencing Shares and Shares not evidenced by certificates shall also bear or
contain, as applicable, legends and notations as may be required by the Company’s
incentive plan or the Company’s charter or bylaws, each as in effect from time
to time, or as the Company may otherwise determine appropriate.


 


4.             Tax Withholding.  To the extent required by law, the Company
shall withhold or cause to be withheld income and other taxes incurred by the
Recipient by reason of a grant of Shares, and the Recipient agrees that he or
she shall upon request of the Company pay to the Company an amount sufficient
to satisfy its tax withholding obligations from time to time (including as Shares
become vested) as the Company may request.


 


5.             Termination.  This Agreement shall continue in full force
and effect until the earliest to occur of the following, at which time except
as otherwise specified below this Agreement shall terminate:  (a) the date on which all repurchase
rights referred to in Section 2 hereof have terminated; or (b) except
to the extent specified in such notice, upon notice of termination by the
Company to the Recipient pursuant to action taken by the Company’s Board of Directors.


 


6.             Miscellaneous.


 


(a)           Amendments.  Neither this Agreement nor any provision
hereof may be changed or modified except by an agreement in writing executed by
the Recipient and the Company; provided, however, that any change or
modification that does not adversely affect the rights hereunder of the
Recipient, as they may exist immediately prior to the effective date of such
change or modification, may be adopted by the Company without an agreement in
writing executed by the Recipient, and the Company shall give the Recipient
written notice of such change or modification reasonably promptly following the
adoption of such change or modification.


 


(b)           Binding Effect of
the Agreement.  This Agreement shall
inure to the benefit of, and be binding upon , the Company, the Recipient and
their respective estates, heirs, executors, transferees, successors, assigns
and legal representatives.


 


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(c)           Provisions
Separable.  In the event that any of
the terms of this Agreement shall be or become or is declared to be illegal or
unenforceable by any court or other authority of competent jurisdiction, such
terms shall be null and void and shall be deemed deleted from this Agreement,
and all the remaining terms of this Agreement shall remain in full force and
effect.


 


(d)           Notices.  Any notice in connection with this Agreement
shall be deemed to have been properly delivered if it is in writing and is
delivered by hand or by facsimile or sent by registered certified mail, postage
prepaid, to the party addressed as follows, unless another address has been
substituted by notice so given:


 


To the Recipient:                                                     To the
Recipient’s address as set forth on the signature page hereof.


 


To the Company:                                                    Five Star
Quality Care, Inc.


400 Centre Street


Newton, MA  02458


Attn: Secretary


 


(e)           Construction.  The headings and subheadings of this
Agreement have been inserted for convenience only, and shall not affect the
construction of the provisions hereof. 
All references to sections of this Agreement shall be deemed to refer as
well to all subsections which form a part of such section.


 


(f)            Employment
Agreement.  This Agreement shall not
be construed as an agreement by the Company, any affiliate of the Company to
employ the Recipient, nor is the Company, any affiliate of the Company
obligated to continue employing the Recipient by reason of this Agreement or
the grant of shares to the Recipient hereunder.


 


(g)           Applicable Law.  This Agreement shall be construed and
enforced in accordance with the laws of The Commonwealth of Massachusetts.


 


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IN
WITNESS WHEREOF, the parties hereto have executed this Agreement, or caused
this Agreement to be executed under seal, as of the date first above written.


 


	
   

  	
  FIVE
  STAR QUALITY CARE, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  RECIPIENT:

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  [Name]

  
	
   

  	
  [Address]