unrestricted Shares, or (iii) through any combination of withheld and deliveredShares, as described in (i) and (ii).     3. Company Representations. The Company hereby represents and warrants to theEmployee that:     (i) the Company, by appropriate and all required action, is duly authorized to enterinto this Agreement and consummate all of the transactions contemplated hereunder; and     (ii) the Shares, when issued and delivered by the Company to the Employee in accordancewith the terms and conditions hereof, will be duly and validly issued and fully paid andnon-assessable.     4. Employee Representations. The Employee hereby represents and warrants to theCompany that:     (i) he is acquiring the Shares for his own account and not with a view towards thedistribution thereof. He further understands that, although there is a public market forthe Shares, there is no assurance that such market will continue;     (ii) he understands that he must bear the economic risk of the investment in theShares, which cannot be sold by him unless they are registered under the Securities Act of1933, as amended (“Securities Act”), or an exemption therefrom is available thereunder andthat the Company is under no obligation to register the Shares for sale under the SecuritiesAct;     (iii) he understands that the Shares are a speculative investment that involve a highdegree of risk including, but not limited to, the risk of losses from operations of theCompany and the total loss of his investment. He further acknowledges and is aware thatthere is no assurance as to the future performance of the Company;     (iv) he has such knowledge and experience in financial and business matters as to becapable of evaluating the merits and risks of an investment in the Shares and has obtained,in his judgment, sufficient information from the Company to evaluate the merits and risks ofan investment in the Company. He believes that the investment in the Shares is suitable forhim based upon his investment objectives and financial needs, and he has adequate means forproviding for his current financial needs and contingencies and has no need for liquiditywith respect to his investment in the Company;     (v) he has not utilized any person as his purchaser representative (as defined inRegulation D) in connection with evaluating such merits and risks and has relied solely uponhis own investigation in making a decision to invest in the Company;     (vi) in his position with the Company, he has had both the opportunity to ask questionsand receive answers from the officers and directors of the Company and all persons acting onits behalf concerning the terms and conditions of the offer made hereunder and to obtain anyadditional information to the extent the Company possesses or may possess such informationor can acquire it without unreasonable effort or expense;     (vii) he has read the Company’s recent filings under the Securities Exchange Act of1934 and has been given access to full and complete information regarding the Company
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and has utilized such access to his satisfaction for the purpose of verifying theinformation included in those filings;     (viii) he is aware that the Company shall place stop transfer orders with its transferagent against the transfer of the Shares in the absence of registration under the SecuritiesAct or an exemption therefrom as provided herein; and     (ix) the certificates evidencing the Shares shall bear the following legend:“The shares represented by this certificate have been acquired pursuant to aRestricted Stock Agreement, dated as of February 11, 2009, a copy of whichis on file with the Company, and may not be transferred, pledged or disposedof except in accordance with the terms and conditions thereof.”     5. Restriction on Transfer of Shares; Vesting. Subject to the restrictions set forthin this Section 5, on ___________, ___________ of the Restricted Shares and the RetainedDistributions with respect thereto shall become vested and on _________, _______ of theRestricted Shares and the Retained Distributions with respect thereto shall become vested. Afterthe date that any of the Restricted Shares become vested, upon the request of the Employee, theCompany shall promptly instruct its transfer agent to issue and deliver to the Employee a newcertificate for the Shares that have vested, which certificate shall not bear the legend set forthin Section 4(ix). If, at any time prior to the vesting of the Restricted Shares in accordance withthis Section 5, the Employee’s employment with the Company is terminated for “Cause” (as defined inEmployee’s employment agreement with the Company) or by the Employee without “Good Reason” (asdefined in Employee’s employment agreement), then the Restricted Shares that have not then vested(and the Retained Distributions with respect thereto) shall be forfeited to the Company and theEmployee shall not thereafter have any rights with respect to such Restricted Shares. If theEmployee dies, becomes “Disabled” (as defined in Employee’s employment agreement), is terminated bythe Company without “Cause” or terminates his employment for “Good Reason,” then all RestrictedShares that have not then vested shall immediately vest. Employee understands that he will berequired to abide by all of the Company’s policies in effect, including the Company’s InsiderTrading Policy, with respect to the ownership and trading of the Company’s securities.     6. Miscellaneous.          6.1. Notices. All notices, requests, deliveries, payments, demands and othercommunications that are required or permitted to be given under this Agreement shall be in writingand shall be either delivered personally or sent by registered or certified mail, or by privatecourier, return receipt requested, postage prepaid to the Company at its principal executive officeand to the Employee at his address set forth below, or to such other address as either party shallhave specified by notice in writing to the other. Notice shall be deemed duly given hereunder whendelivered or mailed as provided herein.          6.2. Waiver. The waiver by any party hereto of a breach of any provision of thisAgreement shall not operate or be construed as a waiver of any other or subsequent breach.
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          6.3. Entire Agreement. This Agreement constitutes the entire agreement between theparties with respect to the subject matter hereof. This Agreement may not be amended except bywriting executed by the Employee and the Company.          6.4. Binding Effect; Successors. This Agreement shall inure to the benefit of and bebinding upon the parties hereto and, to the extent not prohibited herein, their respective heirs,successors, assigns and representatives. Nothing in this Agreement, expressed or implied, isintended to confer on any person other than the parties hereto and as provided above, theirrespective heirs, successors, assigns and representatives any rights, remedies, obligations orliabilities.          6.5. Governing Law. This Agreement shall be governed by and construed in accordancewith the laws of the State of New York (without regard to choice of law provisions).          6.6. Headings. The headings contained herein are for the sole purpose of convenienceof reference, and shall not in any way limit or affect the meaning or interpretation of any of theterms or provisions of this Agreement.          6.7. Employment. Nothing in the Plan or in this Agreement shall confer on theEmployee any right to continue in the employ of, or other relationship with, the Company (or withany parent, subsidiary or affiliate of the Company) or limit in any way the right of the Company(or of any parent, subsidiary or affiliate of the Company) to terminate the Employee’s employmentor other relationship with the Company (or with any parent, subsidiary or affiliate of the Company)at any time, with or without cause.          6.8. Plan Paramount; Conflicts with Plan. This Agreement shall, in all respects, besubject to the terms and conditions of the Plan, whether or not stated herein. In the event of aconflict between the provisions of the Plan and the provisions of this Agreement, the provisions ofthe Plan shall in all respects be controlling.     IN WITNESS WHEREOF, the parties hereto have signed this Agreement as of the day and year firstabove written.         EMPLOYEE:   CASTLE BRANDS INC.                        By:                   Name:        Title:  Address of Employee:
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