ex10-3.htm


    
      


       

      SOUND
FINANCIAL, INC.

      2008
EQUITY INCENTIVE PLAN

      


      RESTRICTED STOCK AWARD
AGREEMENT

      


      


      RS No.
_______________                                                                                                Grant
Date: _______________

      


      This
Restricted Stock Award of Shares (“Restricted Stock”) is granted by Sound
Financial, Inc. (“Company”) to [Name]
(“Grantee”) in accordance with the terms of this Restricted Stock Award
Agreement (“Agreement”) and subject to the provisions of the Sound Financial,
Inc. 2008 Equity Incentive Plan, as amended from time to time
(“Plan”).  The Plan is incorporated herein by reference.

      


      
        	
                1.  

              	
                Restricted
      Stock Award.  The Company makes this Restricted Stock
      Award of [Number] Shares to
      Grantee.  These Shares are subject to forfeiture and to limits
      on transferability until they vest, as provided in Sections 2, 3 and 4 of
      this Agreement and in Article VII of the
Plan.

              


      

       

      
        	
                2.  

              	
                Vesting
      Dates:  The Shares shall vest as
  follows:

              


      

       

      


       

      
        
          	
                  Vesting Date

                	
                  Number of Shares Vesting

                
	
                  [Over
      at least 5 years beginning

                  one
      year from the Grant Date.]

                	
                  [20%
      or less in each annual

                  installment]

                


        

      

      


      
        	
                3.  

              	
                Transferability.  The
      Grantee may not sell, assign, transfer, pledge or otherwise encumber any
      Shares that have not vested, except in the event of the Grantee’s death,
      by will or by the laws of descent and
  distribution.

              


      

       

      
        	
                4.  

              	
                Termination of
      Service.  If the Grantee terminates Service for any
      reason other than in connection with a Change in Control or the death or
      Disability of the Grantee, any Shares that have not vested as of the date
      of that termination shall be forfeited to the Company.  If the
      Grantee’s Service terminates on account of the Grantee’s death or
      Disability, the Vesting Date for all Shares that have not vested or been
      forfeited shall be accelerated to the date of that termination of
      Service.

              


      

       

      
        	
                5.  

              	
                Effect
      of Change in Control.  Upon a Change in Control, the
      Vesting Date for all Shares that have not vested or been forfeited shall
      be accelerated to the date of the earliest event constituting a Change in
      Control.

              


      

       

      
        	
                6.  

              	
                Stock
      Power.  The Grantee agrees to execute a stock power with
      respect to each stock certificate reflecting the Shares in favor of the
      Company.  The Shares shall not be issued by the Company until
      the required stock powers are delivered to the
  Company.

              


      

       

       

      
        
          
          

        

        
          
          

          
          

        

        
          
          

        

      

       

       

       

      
        	
                7.  

              	
                Certificates
      for Shares.  The Company shall issue stock certificates
      in the name of the Grantee reflecting the Shares vesting on each Vesting
      Date in Section 2.  The Company shall retain these certificates
      until the Shares represented thereby become vested.  These
      certificates shall bear the following
legend:

              


      

       

      The
common stock evidenced hereby is subject to the terms of an Award Agreement
between Sound Financial, Inc. and [name] dated [grant
date] made
pursuant to the terms of the Sound Financial, Inc. 2008 Equity Incentive Plan,
copies of which are on file at the executive offices of Sound Financial, Inc.,
and may not be sold, encumbered, hypothecated or otherwise transferred except in
accordance with the terms of such Plan and Award Agreement.

       

      
        	
                8.  

              	
                Grantee’s
      Rights.  As the owner of all Shares that have not vested,
      the Grantee shall be paid dividends by the Company with respect to those
      Shares at the same time as they are paid to other holders of the Company’s
      common stock.  The Grantee may exercise all voting rights
      appurtenant to the Shares.

              


      

       

      
        	
                9.  

              	
                Delivery
      of Shares to Grantee.  Upon the vesting of any Shares,
      the restrictions in Sections 3 and 4 shall terminate, and the Company
      shall deliver only to the Grantee (or, if applicable, the Grantee’s
      Beneficiary or estate) a certificate (without the legend referenced in
      Section 7) and the related stock power in respect of the vesting
      Shares.  The Company’s obligation to deliver a stock certificate
      for vested Shares can be conditioned upon the receipt of a representation
      of investment intent from the Grantee (or the Grantee’s Beneficiary) in
      such form as the Committee requires.  The Company shall not be
      required to deliver stock certificates for vested Shares prior to: (a) the
      listing of those Shares on the Nasdaq; or (b) the completion of any
      registration or qualification of those Shares required under applicable
      law.

              


      

       

      
        	
                10.  

              	
                Adjustments
      in Shares.  In the event of any recapitalization, stock
      split, reorganization, merger, consolidation, spin-off, combination,
      exchange of securities, stock dividend, special or recurring dividend or
      distribution, liquidation, dissolution or other similar corporate
      transaction or event, the Committee, in its sole discretion, may adjust
      the number of Shares or class of securities of the Company covered by this
      Agreement.  Any additional Shares or other securities received
      by the Grantee as a result of any such adjustment shall be subject to all
      restrictions and requirements applicable to Shares that have not
      vested.  The Grantee agrees to execute any documents required by
      the Committee in connection with an adjustment under this Section
      10.

              


      

       

      
        	
                11.  

              	
                Tax
      Election.  The Grantee understands that an election may
      be made under Section 83(b) of Code to accelerate the Grantee’s tax
      obligation with respect to receipt of the Shares from the Vesting Dates to
      the Grant Date by submitting an election to the Internal Revenue Service
      substantially in the form attached
hereto.

              


      

       

      
        	
                12.  

              	
                Tax
      Withholding.  The Company shall have the right to require
      the Grantee to pay to the Company the amount of any tax that the Company
      is required to withhold with respect to such Shares, or in lieu thereof,
      to retain or sell without notice, a sufficient number of Shares to cover
      the minimum amount required to be withheld.  The Company shall
      have the right to deduct from all dividends paid with respect to the
      Shares the amount of any taxes that the Company is required to withhold
      with respect to such dividend
payments.

              


      

       

       

      
        
          
          

        

        
          RS-2

          
          

        

        
          
          

        

      

       

       

       

      
        	
                13.  

              	
                Plan
      and Committee Decisions are Controlling.  This Agreement
      and the award of Shares to the Grantee are subject in all respects to the
      provisions of the Plan, which are controlling.  Capitalized
      terms herein not defined in this Agreement shall have the meaning ascribed
      to them in the Plan.  All decisions, determinations and
      interpretations by the Committee respecting the Plan, this Agreement or
      the award of Shares shall be binding and conclusive upon the Grantee, any
      Beneficiary of the Grantee or the legal representative
      thereof.

              


      

       

      
        	
                14.  

              	
                Grantee’s
      Employment.  Nothing in this Agreement shall limit the
      right of the Company or any of its Affiliates to terminate the Grantee’s
      service or employment as a director, officer or employee, or otherwise
      impose upon the Company or any of its Affiliates any obligation to employ
      or accept the services or employment of the
  Grantee.

              


      

       

      
        	
                15.  

              	
                Amendment.  The
      Committee may waive any conditions of or rights of the Company or modify
      or amend the terms of this Agreement; provided, however, that the
      Committee may not amend, alter, suspend, discontinue or terminate any
      provision of this Agreement if such action may adversely affect the
      Grantee without the Grantee’s written consent.  To the extent
      permitted by applicable laws and regulations, the Committee shall have the
      authority, in its sole discretion, to accelerate the vesting of the Shares
      or remove any other restrictions imposed on the Grantee with respect to
      the Shares, whenever the Committee may determine that such action is
      appropriate by reason of any unusual or nonrecurring events affecting the
      Company, any Affiliate or their financial statements or any changes in
      applicable laws, regulations or accounting
  principles.

              


      

       

      
        	
                16.  

              	
                Grantee
      Acceptance.  The Grantee shall signify acceptance of the
      terms and conditions of this Agreement and acknowledge receipt of a copy
      of the Plan by signing in the space provided below and returning the
      signed copy to the Company.

              


      

       


      
        
           


        

        
          RS-3

           


        

        
           


        

      


      


       

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

       

    

    
       

       

      
        
          
            	 
      	 
      	
                    SOUND
      FINANCIAL, INC.

                  
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	
                    By
      ________________________________

                  
	 
      	 
      	
                    Its  ________________________________

                  
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	 
      
	 
      	 
      	
                    ACCEPTED
      BY GRANTEE

                  
	 
      	 
      	
                    ___________________________________

                  
	 
      	 
      	
                    (Signature)

                  
	 
      	 
      	 
      
	 
      	 
      	
                    ___________________________________

                  
	 
      	 
      	
                    (Print
      Name)

                  
	 
      	 
      	 
      
	 
      	 
      	
                    ___________________________________

                  
	 
      	 
      	
                    (Street
      Address)

                  
	 
      	 
      	
                    ___________________________________

                  
	 
      	 
      	
                    (City,
      State & Zip Code)

                  


          



         

        
          Beneficiary
Designation:

        

         

        The Grantee
designates the following Beneficiary to receive the Shares upon Grantee’s
death:

         

        


        
          
            

          

        

        


         

        


        
          
            
            

          

          
            RS-4