**Exhibit 10.4**

 

**UNOVA,INC.**

**RESTRICTEDSTOCK AGREEMENT**

 

ThisRestricted Stock Agreement (the **“Agreement”**) ismade as of the            dayof                             ,           ,between UNOVA, Inc., a Delaware corporation (the **“Company”**),and                                    (the **“Grantee”**).

 

**WHEREAS,** theUNOVA, Inc.                                              (the  **“Plan”**) wasadopted by the Board of Directors of the Company on                                and was approved by the shareholders of the Company on                        ;and

 

**WHEREAS,** as aninducement to the Grantee to remain in the employ of the Company or one of itssubsidiaries, to increase the Grantee’s proprietary interest in the business ofthe Company through ownership of the Company’s stock, and to reward the Grantee’scontribution to the future success of the Company, the Company desires to awardthe Grantee shares of Restricted Stock (as that term is defined in the Plan) inaccordance with the terms and conditions of this Agreement;

 

**NOW, THEREFORE,**in consideration of the premises, the mutual covenants hereinafter set forth,and other good and valuable consideration, the Company and the Grantee herebyagree as follows:

 

1.        The Company hereby awards the Grantee,as a matter of separate inducement and agreement, and not in lieu of salary orother compensation for services, an Award of Restricted Stock comprising                  shares of the common stock, par value $.01 per share, of the Company (**“Common Stock”**), on the terms and conditions hereinafter setforth, such number of shares to be subject to adjustment as provided in Section             of thePlan.

 

**In order for this Award to become effective, theGrantee must sign and return to the Company’s Secretary one copy of thisAgreement [or accept it electronically as instructed] within 30 days followingthe date at the end of this Agreement. In the event Grantee fails to do so, this Agreement shall be deemedcanceled, null and void.**

 

2.        The Plan, a copy of which has been madeavailable to the Grantee, is incorporated herein by reference and is made partof this Agreement as if fully set forth herein. Capitalized terms used in this Agreement which are not defined hereinshall have the meaning assigned to such terms in the Plan, it being understoodthat the term **“Restricted Stock”** shall mean andrefer only to those shares of Restricted Stock granted pursuant to thisAgreement.  This Agreement is subject to,and the Company and the Grantee agree to be bound by, all of the terms andconditions of the Plan as the same exist at the time this Agreement becameeffective.  The Plan shall control in theevent there is any expressed conflict between the Plan and the terms hereof andwith respect to such matters as are not expressly covered in thisAgreement.  The Board or the Committeemay amend the Plan and the terms of this Agreement only to the extent permittedby Section           of the Plan.

 

3.       The Restricted Stock awarded under thisAgreement will not be evidenced by a stock certificate or certificates. TheRestricted Stock will be registered on the books of the Company by its transferagent in uncertificated form.  Arestriction on transfer will be placed on

 

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theseshares and remain until such time as they vest in accordance with the terms andconditions (including forfeiture) of this Agreement and the Plan.

 

4.       Subject to the provisions of Paragraph 6of this Agreement, there shall be a Restriction Period beginning on the date ofthis Agreement with respect to the shares of Restricted Stock awarded.  [Insert terms of Restriction Period.]  Except as otherwiseprovided in Paragraph 6 hereof, all shares still subject to restriction on thedate of Grantee’s Termination of Employment shall be forfeited by the Grantee.

 

5.       Until the earlier of (i) the expirationof the Restriction Period with respect to any of the shares granted hereunderor (ii) the vesting of such shares in accordance with the provisions of thisAgreement or the Plan, the Grantee shall not be permitted to sell, assign,transfer, pledge, or otherwise encumber shares of Restricted Stock[; providedthat the foregoing shall not prevent the Grantee from pledging Restricted Stockas security for a loan, the sole purpose of which is to provide funds to paythe option price for stock options granted to the Grantee under the Plan or anysuccessor plan of the Company].

 

6.       Notwithstanding any other provision ofthis Agreement, all shares of Restricted Stock granted hereunder still subjectto restriction shall become fully vested and transferable and become free ofall restrictions and deferral limitations to the full extent of the originalgrant upon the occurrence of any of the following events:  (a) the Termination of Employment of theGrantee by reason of the Grantee’s death; (b) the Termination of Employment ofthe Grantee by reason of the Grantee’s Disability; [or] (c) the occurrence of aChange of Control as defined in Section       of the Plan[or (d) the Termination of Employment of the Grantee not by reason of the Grantee’sDisability or death and not due to the Grantee’s voluntary Termination of Employmentor the Company’s Termination of Employment of the Grantee for cause].

 

7.       If and when the Restriction Periodexpires as to the shares of Restricted Stock awarded hereunder without a priorforfeiture of the Restricted Stock, or if and when Restricted Stock vestspursuant to the provisions of Paragraph 6 hereof, and subject to the payment ofwithholding taxes as provided in Paragraph 9 hereof, the Company will direct itstransfer agent to remove the restriction on transfer from the number of shares ofCommon Stock as to which the Restriction Period has ended or that have vestedpursuant to Paragraph 6.

 

8.       Except as otherwise provided in thisAgreement or the Plan, the Grantee shall have all rights of a shareholder withrespect to the shares of Restricted Stock awarded hereunder, including theright to vote such shares and the right to receive any cash dividends which maybe declared on the Company’s Common Stock. Dividends payable in Common Stock shall be paid in the form ofadditional shares of Restricted Stock and shall be held subject to the sameRestriction Period and vesting provisions applicable to the shares ofRestricted Stock on which such dividends were paid.

 

9.       No later than the date as of which anamount first becomes includable in the gross income of the Grantee for federalincome tax purposes with respect to any Restricted Stock granted by thisAgreement, the Grantee shall pay to the Company, or make arrangementssatisfactory to the Company regarding the payment of, any federal, state, localor foreign taxes of any kind required by law to be withheld by the Company withrespect to such amount.  Unless otherwisedetermined by the Committee, withholding obligations (up to the minimumstatutory amount required to be withheld by the Company) may be settled with CommonStock, including shares of the Restricted Stock that give rise to thewithholding requirement or shares of Common Stock already owned by the Granteefor a period of at least six months.  The

 

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obligationsof the Company under the Plan shall be conditional on such payment orarrangements, and the Company and its Subsidiaries shall, to the extent permittedby law, have the right to deduct any such taxes from any payment otherwise dueto the Grantee.  Grantee, therefore, herebyelects, notwithstanding anything to the contrary in this Paragraph 9 or elsewherein this Agreement, to satisfy any and all federal, state, local and foreigntaxes of any kind required to be withheld by the Company in connection withGrantee’s shares (**“Withholding Taxes”**)by selecting one of the following payment options; *provided*that in all cases, the Company shall have the right to receive not less thanthe minimum amount of the Withholding Taxes that the Company is required by lawto withhold (the **“Mandatory Withholding Taxes”**);and *further provided* that an amount equal tothe Mandatory Withholding Taxes in respect of any cash payment to Grantee shallbe withheld from any such cash payment:

 

***OPTION 1:***

 

o                                    Authorizing and directing the Company to deduct from thetotal number of shares of Common Stock issued and deliverable to Granteepursuant to this Agreement the number of shares having a value equal to theamount of the Withholding Taxes on the date such amount becomes due.

 

***OPTION 2:***

 

o            Paying theWithholding Taxes to the Company in cash.

 

***OPTION 3:***

 

o                                    Tendering to the Company thenumber of unrestricted shares of Common Stock owned by the Grantee for a periodof at least six months prior to the date on which Withholding Taxes are due andhaving a value equal to the mandatory Withholding Taxes.

 

**In the event that none of the payment options set forth above isspecified, the Grantee’s election shall be deemed to be Option 1, and theCompany shall proceed accordingly.**

 

11.       Grantee understands and acknowledges thatGrantee is one of a limited number of employees of the Company and its Subsidiarieswho have been selected to receive grants of Restricted Stock and that Grantee’saward is considered Company confidential information.  Grantee hereby covenants and agrees not todisclose the Award of RSUs pursuant to this Agreement to any other personexcept (a) Grantee’s immediate family and legal or financial advisors who agreeto maintain the confidentiality of this Agreement, (b) as required inconnection with the administration of this Agreement and the Plan as it relatesto this award or under applicable law, and (iii) to the extent the terms ofthis Award have been publicly disclosed.

 

12.     The grant of Restricted Stock to theGrantee in any year shall give the Grantee neither anyright to similar grants in future years nor any right to be retained in theemploy of the Company or its Subsidiaries, such employment being terminable tothe same extent as if the Plan and this Agreement were not in effect.  The right and power of the Company and its Subsidiariesto dismiss or discharge the Grantee is specifically and unqualifiedlyunimpaired by this Agreement.

 

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13.     Each notice relating to this Agreementshall be in writing and delivered in person or by mail to the Company at itsoffice, 6001 36th Avenue West, Everett, WA 98203-1264, to the attentionof the Company’s Secretary, or at such other address as the Company may specifyin writing to the Grantee by a notice delivered in accordance with thisparagraph.  All notices to the Granteeshall be delivered to the Grantee at the Grantee’s address specified below orat such other address as the Grantee may specify in writing to the Secretary ofthe Company by a notice delivered in accordance with this paragraph.

 

14.     This Agreement, including the provisions ofthe Plan incorporated by reference herein, comprises the whole Agreementbetween the parties hereto with respect to the subject matter hereof, and shallbe governed by and construed in accordance with the laws of the State ofDelaware, without reference to principles of conflicts of law.  This Agreement shall become effective when ithas been executed or accepted electronically by the Company and the Grantee.

 

15.     This Agreement shall inure to the benefitof and be binding upon each successor of the Company and, to the extentspecifically provided herein and in the Plan, shall inure to the benefit of andshall be binding upon the Grantee’s heirs, legal representatives, andsuccessors.

 

16.     If any provision of this Agreement shall beinvalid or unenforceable, such invalidity or unenforceability shall not affectthe validity and enforceability of the remaining provisions of this Agreement.

 

17.     This Agreement may be executed in separatecounterparts, each of which when so executed and delivered shall be anoriginal, but all of which together will constitute one and the sameinstrument.  In pleading or proving thisAgreement, it will not be necessary to produce or account for more than onesuch counterpart.

 

**IN WITNESS WHEREOF,**thisAgreement is executed by the Grantee and by the Company through its dulyauthorized officer or officers as of the day and year first above written.

 

**DATE:**

 
| ** ** | **UNOVA, Inc.**                                      |   |
|------------|------------------------------------------------------|--------|
|       |                                                 |
|       |                                                 |
|       | By:                                                  |   |
|       | [Name}                                               |
|       | [Title}                                              |
|       |                                                 |
| ** ** | **GRANTEE:**                                         |   |
| * *   | *(Please check one of the boxes under  Paragraph 9)* |
|       |                                                 |   |
|       |                                                 |
|       | Signature                                            |
|       |                                                 |
|       | Address                                              |
|       |                                                 |
|       | Social Security Number                               |
|            |                                                      |        |  |

 

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