exv10w26






Exhibit 10.26




Cardica, Inc.

Restricted Stock Unit Grant Notice

2005 Equity Incentive Plan



Cardica, Inc. (the “Company”), pursuant to its 2005 Equity Incentive Plan, as amended to date (the
“Plan”), hereby awards to Participant a Restricted Stock Unit Award for the number of shares of the
Company’s Common Stock set forth below (the “Award”). The Award is subject to all of the terms and
conditions as set forth herein and in the Plan and the Restricted Stock Unit Agreement (the
“Agreement”), both of which are attached hereto and incorporated herein in their entirety.
Capitalized terms not otherwise defined herein shall have the meanings set forth in the Plan or the
Restricted Stock Unit Agreement, as applicable. In the event of any conflict between the terms in
the Award and the Plan, the terms of the Plan shall control.




	 	 	 	 	 
	Participant:

	 	 

	 	     
	Date of Grant:

	 	 

	 	     
	Vesting Commencement Date:

	 	 

	 	     
	Number of Shares Subject to Award:

	 	 

	 	     







			
	Vesting Schedule:	 	50% of the shares subject to the Award vest on the first (1st)
anniversary of the Vesting Commencement Date, and the remaining shares subject to the Award
vest on the second (2nd) anniversary of the Vesting Commencement Date.
Notwithstanding the foregoing, vesting will cease upon the Participant’s termination of
Continuous Service.






			
	Issuance Schedule:	 	The shares will be issued in accordance with the issuance schedule set forth in
Section 6 of the Agreement.




Additional Terms/Acknowledgements: The undersigned Participant acknowledges receipt of, and
understands and agrees to, this Restricted Stock Unit Grant Notice, the Agreement and the Plan.
Participant further acknowledges that as of the Date of Grant (specified above), this Restricted
Stock Unit Grant Notice, the Agreement and the Plan set forth the entire understanding between
Participant and the Company regarding the acquisition of stock in the Company and supersede all
prior oral and written agreements on that subject with the exception of (i) awards previously
granted and delivered to Participant by the Company, and (ii) the following agreements only:




	 	 	 	 	 
	 

	 	Other Agreements:
	 	  

	 

	 	 	 	  








	 	 	 
	Cardica, Inc.
	 
	 	 
	By:
	 	 
	 

	 	 
	 

	 	Signature
	 
	 	 
	Title:
	 	 
	 

	 	 
	 
	 	 
	Date:
	 	 
	 

	 	 








	 	 	 
	Participant:
	 
	 	 
	 
	 	 
	 
	 

	 	Signature
	 
	 	 
	Date:
	 	 
	 

	 	 










Attachments: Restricted Stock Unit Agreement, 2005 Equity Incentive Plan




1









 





Attachment I




Cardica, Inc.

2005 Equity Incentive Plan




Restricted Stock Unit Agreement




     Pursuant to the Restricted Stock Unit Grant Notice (“Grant Notice”) and this Restricted Stock
Unit Agreement (the “Agreement”), Cardica, Inc. (the “Company”) has awarded you a Restricted Stock
Unit Award (the “Award”) under its 2005 Equity Incentive Plan, as amended to date (the “Plan”).
Your Award is granted to you effective as of the Date of Grant set forth in the Grant Notice for
this Award. This Agreement shall be deemed to be agreed to by the Company and you upon the signing
by you of the Grant Notice to which it is attached. Defined terms not explicitly defined in this
Agreement shall have the same meanings given to them in the Plan. In the event of any conflict
between the terms in this Agreement and the Plan, the terms of the Plan shall control. The details
of your Award, in addition to those set forth in the Grant Notice and the Plan, are as follows.



     1. Grant of the Award. This Award represents the right to be issued on a future date
the number of shares of the Company’s Common Stock as indicated in the Grant Notice. As of the
Date of Grant, the Company will credit to a bookkeeping account maintained by the Company for your
benefit (the “Account”) the number of shares of Common Stock subject to the Award. Except as
otherwise provided herein, you will not be required to make any payment to the Company (other than
past and future services to the Company or an Affiliate) with respect to your receipt of the Award,
the vesting of the shares or the delivery of the underlying Common Stock.



     2. Vesting. Subject to the limitations contained herein, your Award will vest, if at
all, in accordance with the vesting schedule set forth in the Grant Notice, provided that vesting
will cease upon the termination of your Continuous Service. Upon such termination of your
Continuous Service, the shares credited to the Account that were not vested on the date of such
termination will be forfeited at no cost to the Company and you will have no further right, title
or interest in or to such underlying shares of Common Stock.



     3. Number of Shares.



          (a) The number of shares subject to your Award may be adjusted from time to time for
Capitalization Adjustments, as provided in the Plan.




          (b) Any shares, cash or other property that becomes subject to the Award pursuant to this
Section 3, if any, shall be subject, in a manner determined by the Board, to the same forfeiture
restrictions, restrictions on transferability, and time and manner of delivery as applicable to the
other shares covered by your Award.




          (c) Notwithstanding the provisions of this Section 3, no fractional shares or rights for
fractional shares of Common Stock shall be created pursuant to this Section 3. The Board shall, in
its discretion, determine an equivalent benefit for any fractional shares or fractional shares that
might be created by the adjustments referred to in this Section 3.




     4. Securities Law Compliance. You will not be issued any shares under your Award
unless either (a) the shares are registered under the Securities Act; or (b) the Company has
determined that such issuance would be exempt from the registration requirements of the Securities
Act. Your Award also must comply with other applicable laws and regulations governing the Award,
and you will not receive such shares if the Company determines that such receipt would not be in
material compliance with such laws and regulations.



     5. Limitations on Transfer. Your Award is not transferable, except by will or by the
laws of descent and distribution. In addition to any other limitation on transfer created by
applicable securities laws, you agree not to assign, hypothecate, donate, encumber or otherwise
dispose of any interest in any of the shares of Common Stock subject to the Award until the shares
are issued to you in accordance with Section 6 of this



 









 




Agreement. After the shares have been issued to you, you are free to assign, hypothecate,
donate, encumber or otherwise dispose of any interest in such shares provided that any such actions
are in compliance with the provisions herein and applicable securities laws. Notwithstanding the
foregoing, by delivering written notice to the Company, in a form satisfactory to the Company, you
may designate a third party who, in the event of your death, shall thereafter be entitled to
receive any distribution of Common Stock to which you were entitled at the time of your death
pursuant to this Agreement.




     6. Date of Issuance. 



          (a) Subject to Section 10, if applicable, the Company will deliver to you a number of shares
of the Company’s Common Stock equal to the number of vested shares subject to your Award, including
any additional shares received pursuant to Section 3 above that relate to those vested shares, on
the applicable vesting date(s). However, if a scheduled delivery date falls on a date that is not
a business day, such delivery date shall instead fall on the next following business day.




          (b) Notwithstanding the foregoing, in the event that you are subject to the Company’s policy
permitting employees, contractors or consultants to sell shares only during certain “window”
periods, in effect from time to time or you are otherwise prohibited from selling shares of the
Company’s Common Stock in the public market and any shares covered by your Award are scheduled to
be delivered on a day (the “Original Distribution Date”) that does not occur during an open “window
period” applicable to you, as determined by the Company in accordance with such policy, or does not
occur on a date when you are otherwise permitted to sell shares of the Company’s Common Stock on
the open market, and the Company elects (i) not to satisfy its tax withholding obligations by
withholding shares from your distribution, or (ii) not to permit you to enter into a “same day
sale” commitment with a broker-dealer pursuant to Section 10(a)(iii) of this Agreement (including
but not limited to a commitment under a previously established Company-approved 10b5-1 plan), then
such shares shall not be delivered on such Original Distribution Date and shall instead be
delivered on the first business day of the next occurring open “window period” applicable to you
pursuant to such policy (regardless of whether you are still providing Continuous Services at such
time) or the next business day when you are not prohibited from selling shares of the Company’s
Common Stock in the open market, but in no event later than the fifteenth (15th) day of the third
calendar month of the calendar year following the calendar year in which the Original Distribution
Date occurs. The form of such delivery (e.g., a stock certificate or electronic entry evidencing
such shares) shall be determined by the Company. In all cases, the delivery of shares under this
Award is intended to comply with U.S. Treasury Regulation Section 1.409A-1(b)(4) and shall be
construed and administered in such a manner.




     7. Dividends. You shall receive no benefit or adjustment to your Award with respect
to any cash dividend, stock dividend or other distribution that does not result from a
Capitalization Adjustment; provided, however, that this sentence shall not apply with respect to
any shares of Common Stock that are delivered to you in connection with your Award after such
shares have been delivered to you.



     8. Restrictive Legends. The shares issued under your Award shall be endorsed with
appropriate legends if determined by the Company that legends are required under applicable law or
otherwise.



     9. Award Not a Service Contract.



          (a) Your Continuous Service with the Company or an Affiliate is not for any specified term and
may be terminated by you or by the Company or an Affiliate at any time, for any reason, with or
without cause and with or without notice. Nothing in this Agreement (including, but not limited
to, the vesting of your Award pursuant to the schedule set forth in Section 2 herein or the
issuance of the shares subject to your Award), the Plan or any covenant of good faith and fair
dealing that may be found implicit in this Agreement or the Plan shall: (i) confer upon you any
right to continue in the employ of, or affiliation with, the Company or an Affiliate; (ii)
constitute any promise or commitment by the Company or an Affiliate regarding the fact or nature of
future positions, future work assignments, future compensation or any other term or condition of
employment or affiliation; (iii) confer any right or benefit under this Agreement or the Plan
unless such right or benefit has specifically accrued under the terms of this Agreement or Plan; or
(iv) deprive the Company or an Affiliate of the right to terminate you at will and without regard
to any future vesting opportunity that you may have.




 









 








          (b) By accepting this Award, you acknowledge and agree that the right to continue vesting in
the Award pursuant to the schedule set forth in Section 2 is earned only by continuing as an
Employee, Director or Consultant at the will of the Company or an Affiliate (not through the act of
being hired, being granted this Award or any other award or benefit) and that the Company has the
right to reorganize, sell, spin-out or otherwise restructure one or more of its businesses or
Affiliates at any time or from time to time, as it deems appropriate (a “reorganization”). You
further acknowledge and agree that such a reorganization could result in the termination of your
Continuous Service, or the termination of Affiliate status of your employer and the loss of
benefits available to you under this Agreement, including but not limited to, the termination of
the right to continue vesting in the Award. You further acknowledge and agree that this Agreement,
the Plan, the transactions contemplated hereunder and the vesting schedule set forth herein or any
covenant of good faith and fair dealing that may be found implicit in any of them do not constitute
an express or implied promise of continued engagement as an Employee, Director or Consultant for
the term of this Agreement, for any period, or at all, and shall not interfere in any way with your
right or the Company’s or an Affiliate’s right to terminate your Continuous Service at any time,
with or without cause and with or without notice.




     10. Withholding Obligations.



          (a) On or before the time you receive a distribution of the shares subject to your Award, or
at any time thereafter as requested by the Company, you hereby authorize any required withholding
from the Common Stock issuable to you and/or otherwise agree to make adequate provision in cash for
any sums required to satisfy the federal, state, local and foreign tax withholding obligations of
the Company or any Affiliate which arise in connection with your Award (the “Withholding Taxes”).
Additionally, the Company or an Affiliate, or their respective agents, may, in their sole
discretion, satisfy all or any portion of the Withholding Taxes obligation relating to your Award
by any of the following means or by a combination of such means: (i) withholding from any
compensation otherwise payable to you by the Company; (ii) causing you to tender a cash payment;
(iii) permitting you to enter into a “same day sale” commitment with a broker-dealer that is a
member of the Financial Industry Regulatory Authority (a “FINRA Dealer”) whereby you irrevocably
elect to sell a portion of the shares to be delivered under the Award to satisfy the Withholding
Taxes and whereby the FINRA Dealer irrevocably commits to forward the proceeds necessary to satisfy
the Withholding Taxes directly to the Company and/or its Affiliates, including a commitment
pursuant to a previously established Company-approved 10b5-1 plan, or (iv) withholding shares of
Common Stock from the shares of Common Stock issued or otherwise issuable to you in connection with
the Award with a Fair Market Value (measured as of the date shares of Common Stock are issued to
pursuant to Section 6) equal to the amount of such Withholding Taxes; provided, however, that the
number of such shares of Common Stock so withheld shall not exceed the amount necessary to satisfy
the Company’s required tax withholding obligations using the minimum statutory withholding rates
for federal, state, local and foreign tax purposes, including payroll taxes, that are applicable to
supplemental taxable income.




          (b) Unless the tax withholding obligations of the Company and/or any Affiliate are satisfied,
the Company shall have no obligation to deliver to you any Common Stock.




          (c) In the event the Company’s and/or an Affiliate’s obligation to withhold arises prior to
the delivery to you of Common Stock or it is determined after the delivery of Common Stock to you
that the amount of the Company’s and/or an Affiliate’s withholding obligation was greater than the
amount withheld by the Company and/or an Affiliate, you agree to indemnify and hold the Company
and/or the Affiliate harmless from any failure by the Company and/or an Affiliate to withhold the
proper amount.




     11. Unsecured Obligation. Your Award is unfunded, and as a holder of a vested Award,
you shall be considered an unsecured creditor of the Company with respect to the Company’s
obligation, if any, to issue shares pursuant to this Agreement. You shall not have voting or any
other rights as a stockholder of the Company with respect to the shares to be issued pursuant to
this Agreement until such shares are issued to you pursuant to Section 6 of this Agreement. Upon
such issuance, you will obtain full voting and other rights as a stockholder of the Company.
Nothing contained in this Agreement, and no action taken pursuant to its provisions, shall create
or be construed to create a trust of any kind or a fiduciary relationship between you and the
Company or any other person.



     12. Other Documents. You hereby acknowledge receipt of, or the right to receive a
document providing the information required by, Rule 428(b)(1) promulgated under the Securities
Act, which includes the



 









 




Plan prospectus. In addition, you acknowledge receipt of the Company’s policy permitting
certain individuals to sell shares only during certain “window” periods and the Company’s insider
trading policy, in effect from time to time.




     13. Notices. Any notices provided for in your Award or the Plan shall be given in
writing and shall be deemed effectively given upon receipt or, in the case of notices delivered by
the Company to you, five (5) days after deposit in the United States mail, postage prepaid,
addressed to you at the last address you provided to the Company or one (1) business day after
deposit with a nationally-recognized overnight courier specifying next day delivery.
Notwithstanding the foregoing, the Company may, in its sole discretion, decide to deliver any
documents related to participation in the Plan and this Award by electronic means or to request
your consent to participate in the Plan by electronic means. You hereby consent to receive such
documents by electronic delivery and, if requested, to agree to participate in the Plan through an
on-line or electronic system established and maintained by the Company or another third party
designated by the Company.



     14. Miscellaneous.



          (a) The rights and obligations of the Company under your Award shall be transferable to any
one or more persons or entities, and all covenants and agreements hereunder shall inure to the
benefit of, and be enforceable by the Company’s successors and assigns. Your rights and obligations
under your Award may only be assigned with the prior written consent of the Company.




          (b) You agree upon request to execute any further documents or instruments necessary or
desirable in the sole determination of the Company to carry out the purposes or intent of your
Award.




          (c) You acknowledge and agree that you have reviewed your Award in its entirety, have had an
opportunity to obtain the advice of counsel prior to executing and accepting your Award, and fully
understand all provisions of your Award.




          (d) This Agreement shall be subject to all applicable laws, rules, and regulations, and to
such approvals by any governmental agencies or national securities exchanges as may be required.




          (e) All obligations of the Company under the Plan and this Agreement shall be binding on any
successor to the Company, whether the existence of such successor is the result of a direct or
indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business
and/or assets of the Company.




     15. Governing Plan Document. Your Award is subject to all the provisions of the
Plan, the provisions of which are hereby made a part of your Award, and is further subject to all
interpretations, amendments, rules and regulations which may from time to time be promulgated and
adopted pursuant to the Plan. Except as expressly provided herein, in the event of any conflict
between the provisions of your Award and those of the Plan, the provisions of the Plan shall
control.



     16. Severability. If all or any part of this Agreement or the Plan is declared by
any court or governmental authority to be unlawful or invalid, such unlawfulness or invalidity
shall not invalidate any portion of this Agreement or the Plan not declared to be unlawful or
invalid. Any Section of this Agreement (or part of such a Section) so declared to be unlawful or
invalid shall, if possible, be construed in a manner which will give effect to the terms of such
Section or part of a Section to the fullest extent possible while remaining lawful and valid.



     17. Effect on Other Employee Benefit Plans. The value of the Award subject to this
Agreement shall not be included as compensation, earnings, salaries, or other similar terms used
when calculating your benefits under any employee benefit plan sponsored by the Company or any
Affiliate, except as such plan otherwise expressly provides. The Company expressly reserves its
rights to amend, modify, or terminate any of the Company’s or any Affiliate’s employee benefit
plans.



     18. Choice of Law. The interpretation, performance and enforcement of this Agreement
will be governed by the law of the state of Delaware without regard to such state’s conflicts of
laws rules.



 









 





     19. Amendment. This Agreement may not be modified, amended or terminated except by
an instrument in writing, signed by you and by a duly authorized representative of the Company.
Notwithstanding the foregoing, this Agreement may be amended solely by the Board by a writing which
specifically states that it is amending this Agreement, so long as a copy of such amendment is
delivered to you, and provided that no such amendment adversely affecting your rights hereunder may
be made without your written consent. Without limiting the foregoing, the Board reserves the right
to change, by written notice to you, the provisions of this Agreement in any way it may deem
necessary or advisable to carry out the purpose of the grant as a result of any change in
applicable laws or regulations or any future law, regulation, ruling, or judicial decision,
provided that any such change shall be applicable only to rights relating to that portion of the
Award which is then subject to restrictions as provided herein.



     20. Compliance with Section 409A of the Code. This Award is intended to comply with
the “short-term deferral” rule set forth in U.S. Treasury Regulation Section 1.409A-1(b)(4).
Notwithstanding the foregoing, if it is determined that the Award fails to satisfy the requirements
of the short-term deferral rule and is otherwise deferred compensation subject to Section 409A, and
if you are a “Specified Employee” (within the meaning set forth in Section 409A(a)(2)(B)(i) of the
Code) as of the date of your separation from service (within the meaning of U.S. Treasury
Regulation Section 1.409A-1(h)), then the issuance of any shares that would otherwise be made upon
the date of the separation from service or within the first six (6) months thereafter will not be
made on the originally scheduled date(s) and will instead be issued in a lump sum on the date that
is six (6) months and one day after the date of the separation from service, with the balance of
the shares issued thereafter in accordance with the original vesting and issuance schedule set
forth above, but if and only if such delay in the issuance of the shares is necessary to avoid the
imposition of taxation on you in respect of the shares under Section 409A of the Code. Each
installment of shares that vests is intended to constitute a “separate payment” for purposes of
U.S. Treasury Regulation Section 1.409A-2(b)(2).