Exhibit
10.4


 


LANGER, INC.


2005
STOCK INCENTIVE PLAN


RESTRICTED
STOCK AWARD AGREEMENT


 


 


AGREEMENT (the “Agreement”) made as of this 8th
day of November, 2005, by and between Langer, Inc., a Delaware corporation,
having its principal office at 450
Commack Road, Deer Park, New York 11729-4510 (the “Company”), and
Kanders & Company, Inc., a Delaware corporation having offices at One
Landmark Square, Stamford, Connecticut 06901 (the “Consultant”).  Capitalized terms not defined herein shall
have the meanings ascribed to them in the Company’s 2005 Stock Incentive Plan.


 


WHEREAS, the Company has heretofore adopted the
Langer, Inc. 2005 Stock Incentive Plan (the “Plan”) for the benefit of certain
employees, officers, directors, consultants, independent contractors and
advisors of the Company or Subsidiaries of the Company, which Plan has been
approved by the Company’s stockholders;


 


WHEREAS, the Board of Directors of the Company
approved a restricted stock grant to the Consultant on the terms set forth
below, provided Warren B. Kanders, the sole stockholder of the Consultant,
continued to serve as the Chairman of the Board of the Company through
September 1, 2005; and


 


WHEREAS, the Company believes it to be in the
best interest of the Company to grant the restricted stock award hereinafter
set forth;


 


NOW, THEREFORE, the parties agree as follows:


 


1.                                      Stock Grant.  Subject to the
provisions hereinafter set forth and the terms and conditions of the Plan, the
Company hereby grants to the Consultant, as of September 1, 2005 (the “Grant
Date”), a restricted stock grant, subject to the vesting schedule set forth
below, of up to an aggregate of 100,000 shares (the “Restricted Shares”) of
common stock of the Company, par value 
$0.02 per share (the “Common Stock”), such number being subject to
adjustment as provided in the Plan. As more fully described below, the Restricted
Shares granted hereby are subject to forfeiture by the Consultant if certain
criteria are not satisfied.


 


2.                                      Vesting.


 


(a)                                  The Restricted Shares shall vest and be
deemed earned and become nonforfeitable on November 12, 2007, provided that Mr.
Warren B. Kanders is then serving as a director of the Company;  provided, however, that all of the Restricted
Shares shall immediately vest and become nonforfeitable if and when
(i) the consulting agreement dated November 12, 2004 between the Company
and the Consultant (the “Consulting Agreement”) is terminated by the Company
without cause (as such term is used in the Consulting Agreement), or
(ii) Mr. Warren B. Kanders dies, or (iii) a Change-of-Control Event
occurs. For purposes of this Agreement, “Change-of-Control Event” means the
occurrence of any one or more of the following events:  (i) there shall have been a change in a
majority of the Board of Directors of the Company within twelve (12) month
period, unless the appointment of a director or the nomination for election


 


450
Commack Road, Deer Park, New York 11729-4510 Tel: (631) 667-1200, Fax: (631) 254-2320


 





















 


by the Company’s stockholders of each new director was approved by the
vote of a majority of the directors then still in office who were in office at
the beginning of such twelve (12) month period, or (ii) the Company shall have
been sold by either (A) a sale of all or substantially all its assets, or (B) a
merger or consolidation, other than any merger or consolidation pursuant to
which the Company acquires another entity, or (C) a tender offer, whether
solicited or unsolicited.


 


(b)                                 Notwithstanding the vesting schedule set
forth herein, such vesting schedule may be accelerated by the Board of
Directors or the Compensation Committee of the Board of Directors (the “Committee”)
in their sole decision.


 


(c)                                  On the vesting date the Restricted Shares
shall be issued to the Consultant in accordance with the Plan and this
Agreement, including Section 3 below.


 


(d)                                 Nothing in the Plan or this Agreement
amends the terms of the Consulting Agreement, nor shall this Agreement confer
on Consultant any right to continue the Consulting Agreement  or other relationship with the Company or any
subsidiary of the Company, or limit in any way the right of the Company or any
Affiliate of the Company or Subsidiary of the Company to terminate the
Consulting Agreement in accordance with its terms or terminate any other
relationship with the Consultant at any time, with or without cause.


 


(f)                                    Tax Consequences.  Consultant
understands that Consultant may suffer adverse tax consequences as a result of
the grant, vesting or disposition of the Restricted Shares.  Consultant represents that Consultant has
consulted with its own independent tax consultant(s) as Consultant deems
advisable in connection with the grant, vesting or disposition of the Restricted
Shares and that Consultant is not relying on the Company for any tax advice.


 


3.                                      Issuance and Withholding.


 


                                                                                                (a)                                  Upon vesting, the Company shall issue the
earned Restricted Shares registered in the name of Consultant, Consultant’s
authorized assignee, or Consultant’s legal representative, and shall deliver
certificates representing the Restricted Shares.


 


                                                                                                (b)                                 Subject to Section 16 below, prior to the
issuance of the Restricted Shares, Consultant must pay or provide for any
applicable federal or state withholding obligations of the Company.


 


4.                                      Compliance With Laws and
Regulations.  The issuance and transfer of Restricted
Shares shall be subject to compliance by the Company and Consultant with all
applicable requirements of federal and state securities laws and with all
applicable requirements of any stock exchange or quotation system on which the
Company’s Common Stock may be listed at the time of such issuance or transfer


 


5.                                      Non-transferability. Until the Restricted Shares shall be vested and
issued and until the satisfaction of any and all other conditions specified
herein, the Restricted Shares may not be sold, transferred, assigned, pledged
or otherwise encumbered or disposed of by the Consultant, other than by will or
by the laws of descent and distribution, except upon the written consent of the
Company and, in any case, in compliance with the terms and conditions of this
Agreement.  The terms of this restricted
stock grant shall be binding upon the executors, administrators, successors and
assigns of Consultant.


 


6.                                      Privileges of Stock
Ownership.  Consultant shall not have any of the rights
of a stockholder with respect to any Restricted Shares until the Restricted
Shares are issued to Consultant.


 


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7.                                      Interpretation. 
Any
dispute regarding the interpretation of this Agreement shall be submitted by Consultant
or the Company to the Committee for review. 
The resolution of such a dispute by the Committee shall be final and
binding on the Company and Consultant.


 


8.                                      Entire Agreement. 
The Plan
is incorporated herein by reference. 
This Agreement and the Plan constitute the entire agreement and
understanding of the parties hereto with respect to the subject matter hereof
and supersede all prior understandings and agreements with respect to such
subject matter.


 


9.                                      Notices. 
Any notice
required to be given or delivered to the Company under the terms of this
Agreement shall be in writing and addressed to the Corporate Secretary of the
Company at its principal corporate offices. 
Any notice required to be given or delivered to Consultant shall be in
writing and addressed to Consultant at the address indicated above or to such
other address as such party may designate in writing from time to time to the
Company.  All notices shall be deemed to
have been given or delivered upon: personal delivery; three (3) days after
deposit in the United States mail by certified or registered mail (return
receipt requested); one (1) business day after deposit with any return receipt
express courier (prepaid); or one (1) business day after transmission by facsimile.


 


10.                               Successors and Assigns. 
The
Company may assign any of its rights under this Agreement.  This Agreement shall be binding upon and
inure to the benefit of the successors and assigns of the Company.  Subject to the restrictions on transfer set
forth herein, this Agreement shall be binding upon Consultant and Consultant’s
heirs, executors, administrators, legal representatives, successors and
assigns.


 


11.                               Governing Law. 
This
Agreement shall be governed by and construed in accordance with the laws of the
State of Delaware, applicable to agreements made and to be performed entirely
within such state, other than conflict of laws principles thereof directing the
application of any law other than that of Delaware.


 


12.                               Acceptance. 
Consultant
hereby acknowledges receipt of a copy of the Plan and this Agreement.  Consultant has read and understands the terms
and provisions thereof, and accepts this restricted stock grant subject to all
the terms and conditions of the Plan and this Agreement.  Consultant acknowledges that there maybe
adverse tax consequences upon the grant or the vesting of this restricted stock
grant, issuance or disposition of the Restricted Shares and that the Company
has advised Consultant to consult a tax advisor regarding the tax consequences
of the grant, vesting, issuance or disposition.


 


13.                               Covenants of the Consultant  The Consultant agrees (and for any proper
successor hereby agrees) upon the request
of the Committee, to execute and deliver a certificate, in form reasonably
satisfactory to the Committee, regarding applicable Federal and state
securities law matters.


 


14.                               Obligations of the Company


 


                                                                                                (a)                                  Notwithstanding
anything to the contrary contained herein, neither the Company nor its transfer
agent shall be required to issue any fraction of a share of Common Stock, and
the Company shall issue the largest number of whole Restricted Shares of Common
Stock to which Consultant is entitled and shall return to the Consultant the
amount of any unissued fractional share in cash.


 


                                                                                                (b)                                 The Company may endorse such legend or
legends upon the certificates for Restricted Shares issued to the Consultant
pursuant to the Plan and may issue such “stop transfer” instructions to its
transfer agent in respect of such Restricted Shares as, in its discretion, it


 


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determines to be necessary or appropriate to: (i) prevent a violation
of, or to perfect an exemption from, the registration requirements of the
Securities Act; or  (ii) implement the
provisions of the Plan and any agreement between the Company and the Consultant
or grantee with respect to such Restricted Shares.


 


                                                                                                (c)                                  The Company shall pay all issue or
transfer taxes with respect to the issuance or transfer of Restricted Shares to
Consultant, as well as all fees and expenses necessarily incurred by the
Company in connection with such issuance or transfer.


 


 (d)                              All
Restricted Shares issued following vesting shall be fully paid and
non-assessable to the extent permitted by law.


 


15.                               No Section 83(b) Election. 
Consultant
shall not file an election with the Internal Revenue Service under Section
83(b).


 


16.                               Withholding Taxes. The Consultant acknowledges that the
Company is not responsible for the tax consequences to the Consultant of the
granting, vesting or issuance of the Restricted Shares, and that it is the
responsibility of the Consultant to consult with the Consultant’s personal tax
advisor regarding all matters with respect to the tax consequences of the
granting, vesting and issuance of the Restricted Shares. The Company shall have
the right to deduct from the Restricted Shares or any payment to be made with
respect to the Restricted Shares any amount that federal, state, local or
foreign tax law requires to be withheld with respect to the Restricted Shares
or any such payment. Alternatively, the Company may require that the Consultant,
prior to or simultaneously with the Company incurring any obligation to
withhold any such amount, pay such amount to the Company in cash or in shares
of the Company’s Common Stock (including shares of Common Stock retained from
the restricted stock grant creating the tax obligation), which shall be valued
at the Fair Market Value of such shares on the date of such payment. In any
case where it is determined that taxes are required to be withheld in
connection with the issuance, transfer or delivery of the shares, the Company
may reduce the number of shares so issued, transferred or delivered by such
number of shares as the Company may deem appropriate to comply with such
withholding. The Company may also impose such conditions on the payment of any
withholding obligations as may be required to satisfy applicable regulatory
requirements under the Exchange Act, if any.


 


17.                               Miscellaneous


 


                                                                                                (a)                                  If the Consultant loses this Agreement
representing the restricted stock grant granted hereunder, or if this Agreement
is stolen, damaged or destroyed, the Company shall, subject to such reasonable
terms as to indemnity as the Committee, in its sole discretion shall require,
replace the Agreement.


 


                                                                                            (b)                                 This Agreement cannot be amended,
supplemented or changed, and no provision hereof can be waived, except by a
written instrument making specific reference to this Agreement and signed by
the party against whom enforcement of any such amendment, supplement,
modification or waiver is sought. A waiver of any right derived hereunder by
the Consultant shall not be deemed a waiver of any other right derived
hereunder.


 


                                                                                              (c)                                  This Agreement may be executed in any
number of counterparts, but all counterparts will together constitute but one
agreement.


 


                                                                                                (d)                                 In the event of a conflict between the
terms and conditions of this Agreement and the Plan, the terms and conditions
of the Plan shall govern.  All
capitalized terms used herein but not defined shall have the meanings given to
such terms in the Plan.


 


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IN WITNESS WHEREOF, the Company has caused this Agreement
to be executed in duplicate by its duly authorized representative and Consultant
has executed this Agreement in duplicate as of the date first above written.


 


 


	
   

  	
   

  	
  LANGER, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  KANDERS & COMPANY, INC.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  Warren B. Kanders, President

  
					



 


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