**EXHIBIT 10.1**

 

**STOCK AWARD AGREEMENT**

** **

This Stock AwardAgreement (this “*Agreement*”),dated as of **DATE** (the “*Effective Date*”), is between SoftBrands,Inc., a Delaware corporation (the “*Company*”)and **EMPLOYEE****NAME**,(“*Participant*”).  This Stock Award is granted under theSoftBrands, Inc. 2001 Stock Incentive Plan (the “*Plan*”) and is subject to the terms of that Plan.  Capitalized terms used in this Agreement andnot defined in this Agreement have the meanings assigned to them in thePlan.  This Agreement represents theCompany’s unfunded and unsecured promise to issue Common Stock at a futuredate, subject to the terms of this Agreement and the Plan.

 

1.             Award.

 

The Company hereby grants Participant, subject to theterms and conditions of this Agreement and the Plan, a stock award (the “*Stock**Award*”)with respect to **# OF SHARES**shares of the Common Stock, $.01 par value (the “*Shares*”), of the Company . The Stock Award represents the right to receive the Shares only when,and with respect to the number of Shares to which, the Stock Award has vested(the “*Vested Shares*”).  The Stock Award is subject to the terms andconditions set forth in this Agreement and in the Plan.  A copy of the Plan will be furnished uponrequest of Participant.

 

2.             Vesting.

 

Subject to the terms and conditions of this Agreementand the Plan, the Stock Award shall vest and be converted into an equivalentnumber of shares that will be distributed to the Participant as follows:

 
| **On or after Each of the Following Dates** | ** ** | **Percentage of Shares that Vest** | ** ** |
|---------------------------------------------|------------|------------------------------------|------------|
|                                        |       |                               |       |
| First Anniversary of the Effective Date     |       | 25                                 | %          |
| Second Anniversary of the Effective Date    |       | 25                                 | %          |
| Third Anniversary of the Effective Date     |       | 25                                 | %          |
| Fourth Anniversary of the Effective Date    |       | 25                                 | %          |

 

3.             Terminationof Stock Award.

 

### (a)           Except asprovided in subsections (b) below, a Participant’s rights under this Agreementwith respect to the Stock Award shall terminate at the earlier of (i) the timesuch Stock Awards are converted into Vested Shares, or (ii) the termination ofParticipant’s employment with the Company. Upon termination of this Agreement in accordance with clause (ii) above,the Participant’s rights to all of the Shares subject to the Stock Award notvested on the date that Participant ceases to be an employee shall beimmediately and irrevocably forfeited and the Participant will retain no rightswith respect to the forfeited Shares.

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### (b)           Notwithstandingthe provisions of Section 3(a)(ii) above, in the event of termination ofParticipant’s employment with the Company as a result of Participant’s death ordisability (within the meaning of Code Section 22(e)(3)) while in the employ of

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### the Company, the next vesting date for the StockAward, as set out in Section 2(a) above, shall accelerate by twelve (12) monthsas of such date of termination.  TheParticipant’s rights in any unvested shares subject to this Stock shallterminate at the time Participant ceases to be an employee.

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4.             AdditionalRestrictions on Transfer of Stock Award.

 

During the lifetime of Participant, this Stock Awardcannot be sold, assigned, transferred, gifted, pledged, hypothecated or in anymanner encumbered or disposed of at any time prior to delivery of the VestedShares, other than by will or the laws of descent and distribution.

 

5.             Conversionof Stock Award to Shares; Responsibility for Taxes.

 

## (a)           ProvidedParticipant has satisfied the requirements of Section 5(b) below, after thevesting of the Stock Award with respect to Vested Shares, the Vested Shareswill be distributed to Participant or, in the event of Participant’s death, toParticipant’s legal representative, as soon as practicable. The distribution tothe Participant, or in the case of the Participant’s death, to the Participant’slegal representative, of Vested Shares shall be evidenced by a stock certificate,appropriate entry on the books of the Company or of a duly authorized transferagent of the Company, or other appropriate means as determined by theCompany.  In the event ownership orissuance of Vested Shares is not feasible due to applicable exchange controls,securities regulations, tax laws or other provisions of applicable law, asdetermined by the Company in its sole discretion, Participant, or in the eventof Participant’s death, the Participant’s legal representative, shall receivecash proceeds in an amount equal to the value of the Vested Shares otherwisedistributable to Participant, net of the satisfaction of the requirements ofSection 5(b) below.

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## (b)           Bysigning this Agreement, Participant agrees that the Company may withhold from theParticipant’s wages or other cash compensation, or at the sole election of theCompany from Vested Shares to be distributed to Participant in accordance withSection 5(a), all income tax (including federal, state and local taxes), socialinsurance, payroll tax or other tax-related withholding (“Tax Related Items”)due from the Company or the subsidiary that is the Participant’s actualemployer. In this regard, Participant authorizes the Company or the Participant’sactual employer to withhold all applicable Tax Related Items legally payable byParticipant from Participant’s wages or other cash compensation payable toParticipant by the Company or the Participant’s actual employer.  To the extent that the Company determinesthat it is not feasible to withhold from wages, or not permissible underapplicable law to withhold in Shares, then prior to the issuance of VestedShares Participant shall pay, or make adequate arrangements satisfactory to theCompany or to the Participant’s actual employer (in their sole discretion) tosatisfy all withholding obligations of the Company and/or the Participant’sactual employer. Participant shall pay to the Company or to the Participant’sactual employer any amount of Tax Related Items that the Company or theParticipant’s actual employer may be required to withhold as a result ofParticipant’s receipt of the Stock Award and the vesting of the Vested Sharesthat cannot be satisfied by the means previously described. The Company mayrefuse to deliver Vested Shares to Participant if Participant fails to complywith Participant’s obligation in connection with the Tax Related Items asdescribed herein.

 

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Regardless of any actionthe Company or the subsidiary of the Company that is Participant’s actualemployer takes with respect to any or all Tax Related Items, Participantacknowledges that the ultimate liability for all Tax Related Items legally dueby Participant is and remains Participant’s responsibility and that the Companyand/or the Participant’s actual employer (i) make no representations orundertakings regarding the treatment of any Tax Related Items in connectionwith any aspect of the Stock Award, including the grant of the Stock Award, thevesting of Stock Award with respect to Shares, the conversion of the StockAward into Shares or the receipt of an equivalent cash payment, the subsequentsale of any Shares acquired at vesting and the receipt of any dividends; and(ii) do not commit to structure the terms of the grant or any aspect of theStock Award to reduce or eliminate the Participant’s liability for Tax RelatedItems.

 

6.             Miscellaneous.

 

## (a)           PlanProvisions Control.  In the eventthat any provision of this Agreement conflicts with or is inconsistent in anyrespect with the terms of the Plan, the terms of the Plan shall control.

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## (b)           Rightsof Stockholders.  Prior to thevesting a Stock Award with respect to Shares, and prior to the receipt byParticipant, Participant’s legal representative or a permissible assignee ofthe Vested Shares pursuant to Section 5, neither Participant, Participant’slegal representative nor a permissible assignee of the Stock Award shall be orhave any of the rights and privileges of a stockholder of the Company withrespect to the Shares issuable to Participant pursuant to the terms of thisAgreement.  Participant shall not beentitled to receive dividend equivalents on the Stock Award.

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## (c)           Distributionand Adjustment.  In accordance withSection 4(c) of the Plan, the Stock Award is subject to adjustment in theevent that any distribution, recapitalization, reorganization, merger or otherevent covered by Section 4(c) of the Plan shall occur.

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## (d)           NoRight to Employment.  The grant ofthis Stock Award shall not be construed as giving Participant the right to beretained in the employ of the Company or any Affiliate, or as giving a directorof the Company or an Affiliate the right to continue as a director of theCompany or an Affiliate with, the Company or an Affiliate, nor will it affectin any way the right of the Company or an Affiliate to terminate suchemployment or position at any time, with or without cause.  In addition, the Company or an Affiliate mayat any time dismiss Participant from employment, or terminate the term of a directorof the Company or an Affiliate, free from any liability or any claim under thePlan or this Agreement.  Nothing in this Agreement shall confer on any personany legal or equitable right against the Company or any Affiliate, directly orindirectly, or give rise to any cause of action at law or in equity against theCompany or an Affiliate.  This StockAward shall not form any part of the wages or salary of Participant forpurposes of severance pay or termination indemnities, irrespective of the reasonfor termination of employment.  Under nocircumstances shall any person ceasing to be an employee of the Company or anyAffiliate be entitled to any compensation for any loss of any right or benefitunder this Agreement or the Plan which such employee might otherwise haveenjoyed but for termination of employment, whether such compensation is claimedby way of damages for wrongful or unfair dismissal, breach of contract orotherwise.  By participating in the Plan,Participant shall be deemed to have accepted all the terms and conditions ofthe

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## Plan and thisAgreement and the terms and conditions of any rules and regulations adopted bythe Committee and shall be fully bound thereby.

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## (e)           GoverningLaw.  The validity, construction andeffect of the Plan and this Agreement, and any rules and regulations relatingto the Plan and this Agreement, shall be determined in accordance with theinternal laws, and not the law of conflicts, of the State of Minnesota.

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## (f)            Severability.  If any provision of this Agreement is orbecomes or is deemed to be invalid, illegal or unenforceable in anyjurisdiction or would disqualify the Plan or any Award under any law deemedapplicable by the Committee, such provision shall be construed or deemedamended to conform to applicable laws, or if it cannot be so construed ordeemed amended without, in the determination of the Committee, materiallyaltering the purpose or intent of the Plan or the Award, such provision shallbe stricken as to such jurisdiction or Award, and the remainder of thisAgreement shall remain in full force and effect.

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## (g)           NoTrust or Fund Created.  Neither thePlan nor this Agreement shall create or be construed to create a trust orseparate fund of any kind or a fiduciary relationship between the Company orany Affiliate and Participant or any other person.  To the extent that any Person acquires aright to receive payments from the Company or any Affiliate pursuant to a StockAward, such right shall be no greater than the right of any unsecured creditorof the Company or any Affiliate.

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## (h)           OtherBenefits.  No compensation or benefitawarded to or realized by Participant under the Plan or this Agreement shall beincluded for the purpose of computing Participant’s compensation under anycompensation-based retirement, disability or similar plan of the Company unlessrequired by law or otherwise provided by such other plan.

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## (i)            Headings.  Headings are given to the Sections andsubsections of this Agreement solely as a convenience to facilitatereference.  Such headings shall not bedeemed in any way material or relevant to the construction or interpretation ofthis Agreement or any provision thereof.

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## (j)            Confidentiality.  Participant shall not disclose either thecontents or any of the terms and conditions of this Agreement to any otherperson and agrees that such disclosure may result in both immediate terminationof the Stock Award without the right to exercise any part thereof andtermination of employment with the Company.

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## (k)           Notices.  All notices, claims, certificates, requests,demands and other communications hereunder shall be in writing and shall bedeemed to have been duly given and delivered if personally delivered or if sentby nationally recognized overnight courier, by facsimile or by registered orcertified mail, return receipt requested and postage prepaid, addressed asfollows:

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| (i)    |   | If  to the Company, to it at:                     |
|--------|--------|---------------------------------------------------|
|   |   |                                              |
|   |   | SoftBrands, Inc.                                  |
|   |   | Two Meridian Crossings, Suite 800                 |
|   |   | Minneapolis, MN 55423                             |
|   |   | Attn:  Vice President – Human Resources |

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#### (ii)           If toParticipant, to such address as most recently supplied to the Company byParticipant and set forth in the Company’s records; or

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#### (iii)          Tosuch other address as the party to whom notice is to be given may havefurnished to the other party in writing in accordance with thisSection 6(k).

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Any such notice or communication shall be deemed tohave been received (i) in the case of personal delivery, on the date ofsuch delivery (or if such date is not a business day, on the next businessday), (ii) in the case of nationally-recognized overnight courier, on thenext business day after the date sent, (iii) in the case of facsimiletransmission, when received (or if not sent on a business day, on the nextbusiness day after the date sent) and (iv) in the case of mailing, on thethird business day following the date on which the piece of mail containingsuch communication is posted.

 

## (l)            Waiverof Breach. The waiver by either party of a breach of any provision of thisAgreement must be in writing and shall not operate or be construed as a waiverof any other or subsequent breach.

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## (m)          Undertaking.  Both parties hereby agree to take whateveradditional actions and execute whatever additional documents either party mayin their reasonable judgment deem necessary or advisable in order to carry outor affect one or more of the obligations or restrictions imposed on the otherparty under the provisions of this Agreement.

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## (n)           Counterparts.  This Agreement may be executed in one or morecounterparts, and each such counterpart shall be deemed to be an original, butall such counterparts together shall constitute but one agreement.

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## (o)           EntireAgreement.  This Agreement (and theother writings incorporated by reference herein, including the Plan)constitutes the entire agreement between the parties with respect to thesubject matter hereof and supersedes all prior or contemporaneous written ororal negotiations, commitments, representations and agreements with respectthereto.

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**IN WITNESSWHEREOF**, the Company and Participant have executedthis Agreement on the date set forth in the first paragraph.

 

 
|       | **SOFTBRANDS, INC.** |              |
|------------|----------------------|-------------------|
| ** ** |                 |              |
| ** ** |                 |              |
| ** ** | By:                  |              |   |
| ** ** | Name:                | David G. Latzke   |   |
| ** ** | Title:               | SVP & CFO     |   |
| ** ** |                 |              |
| ** ** |                 |              |
| ** ** | **PARTICIPANT**      |              |
|       |                 |              |
|       |                 |              |
| ** ** | By:                  |              |   |
| ** ** | Name:                | **EMPLOYEE NAME** |   |
|            |                      |                   |  |  |  |  |  |

 

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