Document:

Exhibit 10.3

 

DIGITAL
ANGEL CORPORATION

RESTRICTED
STOCK AWARD AGREEMENT

 

 

	
  Participant:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Grant
  Date:

  	
   

  	
                                   ,
  20   

  
	
   

  	
   

  	
   

  
	
  Number
  of Shares of Restricted Stock

  	
   

  	
                                  Shares

  
	
   

  	
   

  	
   

  
	
  Restricted
  Stock Award Reference No.:

  	
   

  	
  RS-

  

 

THIS RESTRICTED STOCK
AWARD AGREEMENT is made as of the Grant Date set forth above by and between
Digital Angel Corporation, a Delaware corporation (the “Company”), and the
individual named above (the “Participant”) pursuant to the terms of the Amended
and Restated Digital Angel Corporation Transition Stock Option Plan, as such
Plan may be amended from time to time (the “Plan”).

 

The Company desires, by
granting to the Participant shares of the Company’s common stock, par value
$0.005 per share (the “Common Stock”), as hereinafter provided, to provide
Participant with incentive to achieve corporate objectives.

 

NOW, THEREFORE, in
consideration of the provision of services by Participant to the Company, the
mutual covenants hereinafter set forth, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereby agree as follows:

 

1.                                       Grant
of Shares of Restricted Stock.  The
Company hereby grants to the Participant the number of shares of Common Stock
set forth above (the “Restricted Stock”) on the terms and conditions set forth
in this Agreement.

 

2.                                       Restrictions
on Transfer; Forfeiture.

 

a.                                       The
shares of Restricted Stock may not be sold, assigned, transferred, pledged or
otherwise encumbered by the Participant until such shares of Restricted Stock
are vested as hereinafter provided.  Any
attempt to dispose of shares of Restricted Stock in a manner contrary to these
restrictions shall be void and of no force or effect.

 

b.                                      If
the Participant’s active employment or other service with the Company or with
an Affiliate is terminated for any reason before the shares of Restricted Stock
are vested, including because of the disability of the Participant but not upon
the death of the

 

 

Participant, all shares
of Restricted Stock shall immediately and automatically terminate and be
forfeited to the Company, and neither the Participant nor any of the
Participant’s heirs, personal representatives, successors or assigns shall have
any rights with respect to such Restricted Stock.

 

c.                                       The
Participant’s death shall not affect this grant of shares of Restricted Stock,
which shall continue under the same terms and conditions for the benefit of the
Participant’s heirs, personal representatives and/or legatees according to the
Participant’s will or the laws of descent and distribution.

 

3.                                       Vesting;
Term.

 

a.                                       The
shares of Restricted Stock awarded to Participant pursuant to Section 1
shall vest, and the restrictions on said shares shall terminate, as to the
number of shares of Restricted Stock determined in reference to the following schedule or
the occurrence of either a “Change of Control” (as such term is defined in
Participant’s employment agreement with Applied Digital Solutions, Inc.)
or in the event that the Participant ceases to be the Chairman of the Company’s
Board of Directors.

 

 

	
  Percentage of Shares

  of Restricted Stock

  	
   

  	
  Vesting Dates

  
	
  50%

  	
   

  	
  First Anniversary Date
  of this Agreement

  
	
  50%

  	
   

  	
  Second Anniversary Date
  of this Agreement

  

 

b.                                      This
award of Restricted Stock shall terminate and be of no force or effect as to
any shares of Restricted Stock not vested on or before ten years from the Grant
Date.

 

4.                                       Stock
Certificates.

 

a.                                       The
Company will issue a stock certificate in the name of the Participant
representing the shares of Restricted Stock granted under this Plan.  The Participant agrees that the Company will
hold such stock certificate in custody until the shares of Restricted Stock
vest or terminate and are forfeited, and that the certificate may bear an
appropriate legend referring to the terms, conditions and restrictions
applicable to the grant of shares of Restricted Stock substantially in the
following form:

 

The transferability of
the shares of common stock represented by this certificate is subject to the
terms and conditions of the Amended and Restated Digital Angel Corporation
Transition Stock Option Plan and a Restricted Stock Award Agreement entered
into under such Plan between the registered owner of this stock certificate and
Digital Angel Corporation.  Copies of
such Plan and Agreement are on file at the offices of Digital Angel
Corporation.

 

b.                                      As
a condition of this award, the Participant agrees that, simultaneously with the
execution of this Agreement, the Participant will execute and deliver to the
Company a

 

2

 

stock power in the
form attached hereto as Exhibit A, endorsed in blank,  relating to each certificate evidencing the
shares of Restricted Stock.

 

5.                                       Consideration
for Restricted Shares.  The
Participant is not required to pay any consideration to the Company or its
Affiliates upon the grant or vesting of the shares of Restricted Stock other
than the rendering of services for the Company.

 

6.                                       Dividends.  The Participant shall have the right to
receive dividends and other distributions with respect to the shares of
Restricted Stock; provided, however, that all dividends in stock, all stock
rights and all stock issued upon split-ups or reclassifications shall be subject
to the same restrictions as the shares Restricted Stock upon which such stock
dividends, rights or additional shares are issued, and shall be held in custody
by the Company until the restrictions thereon shall have lapsed.

 

7.                                       Employment
and Retention.  The shares of
Restricted Stock granted hereunder will not confer upon the Participant any
right with respect to continuance of employment, service or other retention by
the Company, nor will they interfere in any way with the Company’s right to
terminate Participant’s employment, service or other retention at any time for
any reason or for no reason.

 

8.                                       Income
Tax Withholding; Tax and Financial Advice. 
The Company shall have the right to require the payment (through
withholding from the Participant’s salary or otherwise) of any federal, state
or local taxes required by law to be withheld with respect to the grant of the
shares of Restricted Stock or the vesting of such shares of Restricted
Stock.  The Participant acknowledges and
represents to the Company that the Participant has obtained advice with respect
to the tax and other financial consequences of the grant of the shares of
Restricted Stock including, without limitation, advice with respect to the
election that the Participant may make under Section 83(b) of the
Code.

 

9.                                       Plan
Governs.  The provisions of this
Restricted Stock Agreement are subject to the Plan, and if any provision of
this Restricted Stock Agreement conflicts with the Plan, the provisions of the
Plan shall govern.  All capitalized terms
used but not defined in this Restricted Stock Agreement shall have the same
meanings ascribed to them in the Plan. 
The Participant acknowledges and represents to the Company that the
Participant has received a copy of the Plan, the Participant has reviewed the
Plan and this Agreement and/or had them reviewed by the Participant’s advisors
to the Participant’s satisfaction, and that the Participant understands the
Plan and this Agreement.

 

10.                                 Interpretation.  The interpretation and construction of any
provision of this Restricted Stock Agreement, including whether a Vesting Event
has occurred on or before a Vesting Date, shall be made by the Committee and
shall be final, conclusive and binding on the Participant and all other
persons.

 

3

 

IN
WITNESS WHEREOF, the Company has caused this Agreement to be
executed in its corporate name by its duly authorized officers and the
Participant has executed this Agreement, as of the Grant Date set forth above.

 

	
   

  	
  DIGITAL ANGEL
  CORPROATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Signature

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name Typed or Printed

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Its:

  	
   

  
	
   

  	
   

  	
   

  	
  Title Typed or Printed

  
	
   

  	
   

  	
   

  
	
   

  	
  PARTICIPANT:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature

  
	
   

  	
   

  
	
   

  	
  Name Typed or Printed

  
	
   

  	
   

  
	
   

  	
  Participant’s Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Participant’s Social
  Security or Tax

  
	
   

  	
  Identification Number:

  
	
   

  	
   

  
	
   

  	
   

  

 

4

 

EXHIBIT A

 

STOCK POWER

(Assignment Separate from
Certificate)

 

For Value Received,                                                          
hereby sells, assigns and transfers unto

                                                         
(              )
shares of the non-voting common stock of Digital Angel Corporation (the “Company”)
standing in his/her/its name on the books of the Company represented by Stock
Certificate No.               
herewith and does hereby irrevocably constitute and appoint                                                          
attorney-in-fact to transfer the said stock on the books of the Company with
full power of substitution in the premises.

 

 

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name Typed or Printed

  
	
   

  	
   

  
	
  IN PRESENCE OFExhibit
10.8

 

GENERAL
RELEASE AND RETIREMENT SEPARATION AGREEMENT

 

This General Release and
Retirement Separation Agreement (“Retirement Separation Agreement”) is entered
into between Bart A. Brown, Jr. (“Brown”) and MAIN STREET AND MAIN INCORPORATED
(“Main Street”) (jointly referred to as “the parties”).

 

RECITALS

 

(A)                           Brown is an
Arizona employee of Main Street.

 

(B)                             Brown’s
employment with Main Street is formally ending effective March 31st, 2004.
His last day at work will be Wednesday, March 31, 2004.

 

(C)                             Brown and Main
Street have decided to amicably resolve all matters between them concerning
Brown’s employment and the circumstances surrounding his retirement and the ending
of his employment and relationship with Main Street.

 

AGREEMENT

 

NOW THEREFORE, in
consideration of the mutual promises set forth below in this Retirement
Separation Agreement, Brown and Main Street agree as follows:

 

1.                                       Notwithstanding
the date of execution of this Retirement Separation Agreement, the parties
agree that it is their intent that it shall not be effective until March 31,
2004, the date of Brown’s retirement from Main Street, and that on March 31,
2004 it shall be in full force and effect. In addition, the parties recognize
that Brown shall continue to be employed by Main Street through March 31,
2004. Pursuant to such employment Brown shall be entitled to receive his
current salary and related fringe benefits from this date through March 31,
2004, his bonus for 2003 as determined by the Compensation Committee of the Board
of Directors and reimbursement for expenses incurred for Main Street through March 31,
2004. In consideration for a General Release given by Brown in this Retirement
Separation Agreement, Main Street will

 

 

provide him, at the
times specified, the following payments and benefits. Brown acknowledges that
he is not otherwise entitled to receive the following without the signed
execution of this Retirement Separation Agreement.

 

a.                                      Payment of one
year annual base pay or $300,000 as Retirement Separation Pay with applicable
State and Federal taxes withheld. This Retirement Separation pay will be paid
in monthly installments of $25,000 less applicable taxes commencing on the
first day of April 2004 and monthly thereafter on the first day of each
succeeding month until this sum has been paid in full. The sum called for
hereunder shall be payable to Brown’s estate in the event of his death or disability.

 

b.                                     Main Street will
allow Brown to participate in the existing Main Street programs, at his cost of
the actual premiums, for executive physicals healthcare benefits and life
insurance.

 

c.                                      Main Street
agrees to honor Brown’s existing stock options reflected on Exhibit A attached
hereto, but no additional options shall be granted.

 

d.                                     Under a separate
agreement, Main Street is offering Brown, contemporaneously with the execution
of the Retirement Separation Agreement, a consulting contract (attached hereto
as Exhibit B and incorporated herein by reference) commencing on the date of
this Retirement Separation Agreement and through September 30, 2005.

 

e.                                      All accrued but
unused vacation shall be taken by Brown prior to March 31, 2004 or shall
be waived.

 

2.                                       In consideration
of the above mentioned payment and benefits, Brown and his successors and
assigns, release and discharge Main Street and Main Street-sponsored employee
benefits plans in which Brown participates, and any of Main Street’s affiliates
and/or subsidiary entities (hereafter collectively referred to as “Main Street”)
and all Main Street’s past, present and future

 

2

 

officers, directors, partners, agents,
shareholders, trustees, lawyers, legal representatives, employees, assigns,
joint ventures, insurers, predecessors-in-interest, successors-in-interest, and
underwriters, any other agents from any and all causes of action, judgments,
liens, indebtedness, costs, charges, damages, obligations, attorney’s fees,
losses, claims, liabilities and demands of whatever kind and character, known
or unknown (“Claims”), which Brown may now have or has ever had against Main
Street, including without limitation, all claims arising from or in any way
connected with the employment of Brown by Main Street or whether acting within
or beyond the scope of their employment, or based in tort, contract (express or
implied) or any federal, state or local law, statute or regulation.

 

3.                                       In consideration
of the above mentioned payment and benefits, Main Street and Main Street’s
affiliates and subsidiaries, and its successors and assigns, subsidiary
entities (hereafter collectively referred to as “Main Street”) and all Main
Street’s past, present and future officers, directors, partners, agents,
shareholders, trustees, lawyers, legal representatives, employees, assigns,
joint ventures, insurers, predecessors-in-interest, successors-in-interest, and
underwriters, any other agents release and discharge Brown from any and all
causes of action, judgments, liens, indebtedness, costs, charges, damages,
obligations, attorney’s fees, losses, claims, liabilities and demands of
whatever kind and character, (“Claims”), which Main Street may now have or have
ever had against Brown, including without limitation, all claims arising from
or in any way connected with the employment of Brown by Main Street or whether
acting within or beyond the scope of his employment, or based in tort, contract
(express or implied) or any federal, state or local law, statute or regulation.

 

4.                                       Brown’s release
of Claims includes, but is not limited to, any Claims arising under Title VII
of the Civil Rights Act of 1964, as amended. 42 U.S.C. § 2000(e), et
seq: the Civil Rights act of 1966, as amended, 42 U.S.C. § 1981, et
seq: the Age Discrimination in Employment Act,

 

3

 

as amended, 29 U.S.C. Section 623, et
seq;: the Older Workers’ Benefit Protection Act, 29 U.S.C. Section 626(f):
the Americans with Disabilities Act of 1990, 42 U. S. C. § 12101 et seq:
the Fair Labor Standards Act of 1939, as amended 29 U.S.C. § 201, et
seq; the Family Medical Leave Act of 1993, 29 U.S.C. § 2601, et seq:
the Rehabilitation Act of 1973, as amended, 29 U.S. C. § 701 et seq:
the Employee Retirement Income Security Act of 1974 29 U.S.C. § 1001. et seq: the National Labor Relations Act, as amended,
29 U.S.C. § 151. et seq.: relating to wages, hours or working
conditions, and any Claim based on contract, quasi-contract, implied contract,
tort, wrongful or constructive discharge, breach of the covenant of good faith
and fair dealing, defamation, immigration issues, infliction of emotional
distress, assault, battery, discrimination on any basis prohibited by statute
or public policy, negligence, or any interference with business opportunity or
with contract. The parties intend that this paragraph be construed as broadly
as possible.

 

5.                                     A.                                   Brown represents
that he presently has no Claims of any kind against Main Street arising out of
or relating to his employment or termination of that employment that are
presently pending before any state, federal or other court, or local, state of
federal agency or other professional entity. If arguendo any such Claims
are pending, Brown agrees to dismiss and withdraw the same with prejudice.
Brown further represents that Brown will not pursue, initiate or cause to be instituted
any Claim before any state, federal or other court, or local, state of federal
agency or other governmental entity arising out of or related to the Brown’s
employment or termination of that employment with Main Street.

 

B.                                    Main Street
represents that it presently has no Claims of any kind against Brown arising
out of or relating to his employment or termination of that employment that are
presently pending before any state, federal or other court, or local, state of
federal agency or other professional entity. If arguendo any such Claims
are pending, Main Street agrees to dismiss and withdraw the same with
prejudice. Main Street further represents that Main Street will not

 

4

 

pursue, initiate or cause to be instituted
any Claim before any state, federal or other court, or local, state of federal
agency or other governmental entity arising out of or related to the Brown’s
employment or termination of that employment with Main Street.

 

6.                                       This Retirement
Separation Agreement extends to all Claims of every nature and kind by Brown
against Main Street and or by Main Street against Main whether known or
unknown, suspected or unsuspected, past or present, and whether or not they
arise out of or are attributable to the circumstances of Brown’s employment or
termination of that employment with Main Street.

 

7.                                       The parties
acknowledge that while Brown was employed as Main Street’s CEO, he was entitled
to certain indemnities and indemnifications as called for in Main Street’s
constituent documents and that nothing contained herein shall in any way be
construed to affect, diminish or eliminate any such indemnities or
indemnifications and such rights remain in full force and effect.

 

8.                                       Brown shall
assist Main Street, upon request, in any matter in which Brown was involved while
employed with the Company, which includes, but is not limited to, the
situations he encountered as CEO and director of Main Street. Such assistance
shall be without charge to Main Street if it can be provided by telephone and
without inconvenience to him. If Brown receives any legal documents, such as a
subpoena, which are related to his employment at Main Street, Brown agrees to
contact Main Street’s legal department immediately upon receipt.

 

9.                                       Brown agrees to
return to Main Street on or before March 31, 2004, all property and documents
of Main Street that are in Brown’s possession or control.

 

10.                                 Brown represents
and warrants that he has not assigned or transferred, or purported to have assigned
or transferred, to any firm, corporation, entity or person, any Claim released
in this Retirement Separation Agreement.

 

5

 

11.                                 This payment
Brown receives under this Retirement Separation Agreement constitutes the sole
consideration due Brown under this Retirement Separation Agreement, and
includes any and all costs and attorneys’ fees which Brown could seek from Main
Street.  The parties agree that no
additional amount shall be due from Main Street to Brown for earned and unused vacation,
overtime, bonus or any other reason.

 

12.                                 A.                                   Brown
acknowledges that the factual circumstances under which he signed this Retirement
Separation Agreement may later prove to be different than now known or
believed. Brown accepts and assumes this risk and agrees that this Retirement
Separation Agreement shall remain effective in all aspects and not be subject
to termination or rescission by reason of any later discovered facts.

 

B.                                  Main Street
acknowledges that the factual circumstances under which it signed this
Retirement Separation Agreement may later prove to be different than now known
or believed. Main Street accepts and assumes this risk and agrees that this
Retirement Separation Agreement shall remain effective in all aspects and not
be subject to termination or rescission by reason of any later discovered
facts.

 

13.                                 If any provision
of this Retirement Separation Agreement is determined to be invalid or unenforceable,
all of the other provisions shall remain valid and enforceable notwithstanding,
unless the provision found to be unenforceable is of such material effect that
this Retirement Separation Agreement cannot be performed in accordance with the
intent of the parties in its absence.

 

14.                                 The terms and
conditions contained herein and in Exhibit A constitute the entire agreement
between the parties and supersede all previous communications, either oral or written,
between the parties with respect to the subject matter, and no agreement or understanding
varying or extending the terms shall be binding upon either party unless in
writing signed by or on behalf of such party.

 

6

 

15.                                 No promise,
inducement or agreement other than those expressed in this Retirement Separation
Agreement and its Exhibit A have been made by either
party. This Retirement Separation Agreement constitutes a single integrated
contract and expresses the parties’ entire agreement with the exception of a
consulting agreement previously referred to as Exhibit A. There are no other
agreements, written or oral, expressed or implied, between the parties concerning
the subject matter of this Retirement Separation Agreement.

 

16.                                 This Retirement
Separation Agreement can be amended, modified or terminated only by a writing
signed by both Brown and an authorized agent of Main Street.

 

17.                                 Each party has
had a full and complete opportunity to review this Retirement Separation Agreement
and, if desired, each party has received independent legal advice from an
attorney or has had ample opportunity to seek such advice as to the meaning and
advisability of signing this Retirement Separation Agreement. Accordingly, the
parties agree that the common law principles of construing ambiguities against
the drafter shall have no application to this Retirement Separation Agreement.

 

18.                                 Brown represents
that he is in good health and fully competent to manage his business affairs,
and understands all of this Retirement Separation Agreement’s contents.

 

19.                                 This Retirement Separation
Agreement shall be subject to and governed by the laws of the State of Arizona.
Both parties consent to the jurisdiction of Arizona courts.

 

20.                                 BROWN  HAS  CAREFULLY  READ  THIS  RETIREMENT  SEPARATION AGREEMENT, HAS HAD THE OPPORTUNITY
TO FULLY DISCUSS THIS AGREEMENT WITH AN ATTORNEY OR OTHER ADVISOR, HAS HAD
AMPLE TIME TO REFLECT UPON AND CONSIDER ITS CONSEQUENCES, FULLY UNDERSTANDS ITS
FINAL AND BINDING EFFECT, AND IS SIGNING THIS AGREEMENT VOLUNTARILY.

 

BROWN ACKNOWLEDGES THAT
HE HAS BEEN GIVEN THE OPPORTUNITY TO CONSIDER THIS AGREEMENT FOR A PERIOD OF UP
TO TWENTY-ONE (21) DAYS BEFORE SIGNING IT. IN ADDITION, BOTH BROWN AND MAIN
STREET AGREE

 

7

 

AND ACKNOWLEDGE THAT BROWN HAS THE RIGHT TO
REVOKE THIS AGREEMENT WITHIN SEVEN (7) DAYS OF ITS EXECUTION OR THAT THIS
AGREEMENT IS NOT EFFECTIVE OR ENFORCEABLE UNTIL THAT REVOCATION PERIOD HAS
EXPIRED. SUCH REVOCATION IS TO BE IN WRITING AND DELIVERED TO MAIN STREET
WITHIN THE SEVEN (7) DAY PERIOD TO THE PERSON DESIGNATED IN THE LETTER WHICH IS
ATTACHED HERETO AND BY REFERENCE INCORPORATED HEREIN.

 

 

AGREED AND ACCEPTED:

 

 

	
  Dated: November 19, 2003

  	
  /s/
  Bart A. Brown Jr.

  	
   

  
	
   

  	
  Bart A. Brown Jr.

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated: November 19, 2003

  	
  MAIN STREET AND MAIN

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
  /s/
  John F. Antioco

  	
   

  
	
   

  	
   

  	
  John F. Antioco

  
	
   

  	
   

  	
  Chairman of the Board

  
						

 

8

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