DATAWATCH
CORPORATION
Restricted
Stock Unit Agreement for Directors
Datawatch
Corporation, a Delaware
corporation (the “Company”), hereby grants as of the award date below (“Award
Date”) to the director named below (the “Participant”), and the Participant
hereby accepts, an award (“Award”) of Restricted Stock Units (“RSU”) that will
vest as described in the Vesting Schedule below, such Award to be subject
to the
terms and conditions specified in the attached
Exhibit A
.
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Participant
Name:
Award
Date:
Number
of RSUs:
Vesting
Schedule:
Vesting
Date
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_____________________________________
_____________________________________
_____________________________________
Number
of RSUs
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By
signing this Agreement, the Participant acknowledges receipt of a copy of
this
Agreement and a copy of the 2006 Equity Compensation and Incentive Plan and
the
Prospectus related thereto.
This
Agreement will be effective only upon execution by the Participant and delivery
of such signed Agreement to the Company.
IN
WITNESS WHEREOF, the Company and the
Participant have caused this instrument to be executed as of the Award Date
set
forth above.
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___________________________
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DATAWATCH
CORPORATION
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(Participant
Signature)
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___________________________
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(Street
Address)
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By:__________________________________
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Name:
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___________________________
(City/State/Zip
Code)
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Title:
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Exhibit
A
Restricted
Stock Unit Agreement for Directors
Terms
and Conditions
1.
Award
. The
Participant is hereby granted an Award of RSUs, effective as
of
the date set forth on the cover page attached hereto
(the “Award Date”), subject to the terms and conditions set forth herein
(collectively with the cover page, the “Agreement”), and subject to and governed
by the Company’s 2006 Equity Compensation and Incentive Plan (the
“Plan”). Capitalized terms not otherwise defined herein shall have
the meanings ascribed to them in the Plan. Each RSU represents the right
to
receive one share of the Company’s Common Stock upon the satisfaction of terms
and conditions set forth in this Agreement and the Plan.
2.
Vesting
. Except
as set forth in Section 6 herein, the RSUs will remain restricted and may
not be
sold, assigned, exchanged, pledged or otherwise transferred by the Participant
until the RSUs have become vested pursuant to the terms of this
Agreement. If the Participant has continued to serve the Company in
the capacity of a director, then the RSUs will vest as provided on the cover
page hereto.
Each date on which a portion of the Award
vests
shall be referred to herein as a “Vesting
Date.”
Notwithstanding the foregoing, in accordance with
and subject to the provisions of the Plan, the Committee may, in its discretion,
accelerate the date that any installment of this RSU becomes vested.
3.
Acceleration
of Vesting Upon Change of Control
. Notwithstanding
Section 2 hereof, in the event of a Change in Control (as defined below) of
the Company while this RSU is in effect, this RSU shall, immediately prior
to
the consummation of such Change in Control, become fully vested and all shares
subject to this RSU shall be delivered to the Participant;
provided
,
however
, that the Board, in its sole discretion, may require that
the
Participant’s rights under this Section 3 shall be conditioned on approval by
the stockholders of the Company in accordance with Section 280G(b)5(B) of
the
Code and regulations thereunder. For purposes of this Agreement, a
“Change in Control” means the occurrence of any of the following
events:
(a)
The
Company is merged or consolidated or reorganized into or with another
corporation or other legal person, and as a result of such merger, consolidation
or reorganization less than a majority of the combined voting power of the
then-outstanding securities of such surviving, resulting or reorganized
corporation or person immediately after such transaction is held in the
aggregate by the holders of the then-outstanding securities entitled to vote
generally in the election of directors of the Company ("Voting Stock")
immediately prior to such transaction;
(b)
The
Company sells or otherwise transfers all or substantially all of its assets
to
any other corporation or other legal person, and as a result of such sale
or
transfer less than a majority of the combined voting power of the
then-outstanding securities of such corporation or person immediately after
such
sale or transfer is held in the aggregate by the holders of Voting Stock
of the
Company immediately prior to such sale or transfer;
(c)
There
is
a report filed on Schedule 13D or Schedule 14D-1 (or any successor
schedule, form or report), each as promulgated pursuant to the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), disclosing that any
"person" (as such term is used in Section 13(d)(3) or Section 14(d)(2)
of the Exchange Act) has become the "beneficial owner" (as such term is used
in
Rule 13d-3 under the Exchange Act) of securities representing 50% or more
of the
Voting Stock of the Company;
(d)
The
Company files a report or proxy statement with the Securities and Exchange
Commission pursuant to the Exchange Act disclosing in response to Form 8-K
or
Schedule 14A (or any successor schedule, form or report or item therein)
that a change in control of the Company has occurred; or
(e)
If
during
any period of two consecutive years, individuals who at the beginning of
any
such period constitute the Board cease for any reason to constitute at least
a
majority thereof, unless the election, or the nomination for election by
the
Company’s stockholders, of each director of the Company first elected during
such period was approved by a vote of at least a majority of the directors
then
still in office who were directors of the Company at the beginning of any
such
period;
provided
,
however
, that a “Change in Control” shall not be deemed to have occurred
for purposes of this Agreement solely because (x) the Company, (y) an
entity in which the Company directly or indirectly beneficially owns 50%
or more
of the voting securities, or (z) any Company-sponsored employee stock
ownership plan or any other employee benefit plan of the Company, either
files
or becomes obligated to file a report or a proxy statement under or in response
to Schedule 13D, Schedule 14D-1, Form 8-K or Schedule 14A
(or any successor schedule, form or report) under the Exchange Act, disclosing
beneficial ownership by it of shares of Voting Stock or because the Company
reports that a change in control of the Company has occurred by reason of
such
beneficial ownership.
4.
Distribution
of the Award; Dividend Equivalents.
As soon as reasonably
practicable following each Vesting Date, the Company will release the portion
of
the Award that has become vested as of such Vesting Date in the form of shares
of the Company’s Common Stock. The Company shall provide the
Participant with at least seven (7) days written notice prior to the Vesting
Date; such notice to specify the amount that the Participant is required
to pay
to satisfy any applicable withholding Taxes (as hereinafter below). The
Participant may deposit with the Company an amount of cash equal to the amount
determined by the Company, utilizing a tax rate determined by the Company
in its
reasonable discretion, to be required with respect to any withholding taxes,
FICA contributions, or the like under any national, federal, state, local
or
other statute, ordinance, rule, or regulation in connection with the award
or
settlement of the restricted stock units (the
“Taxes”). Alternatively, if the Company does not receive such amount
from the Participant at least two (2) days prior to the Vesting Date, the
Company will withhold a number of shares (rounded up to the nearest whole
share)
of the Company’s Common Stock with a market value determined as of the close of
business on the business day immediately preceding the Vesting Date) equal
to
the amount of such Taxes associated with the vesting or settlement of the
Award;
provided, however
, that the Company shall not be liable for determining
the exact number of shares.
The
Participant shall have the right to receive dividend equivalent payments
with
respect to the Common Stock subject to the Award as provided in this
paragraph. Upon each Vesting Date, Participant shall be entitled to
receive a dividend equivalent payment in respect of the shares of Common
Stock
covered by the Award that are not vested on the record date for each dividend
payment, if any, made by the Company on its Common Stock for which the record
date occurred (i) on or after the Award Date or the immediately preceding
Vesting Date, as the case may be, and (ii) prior to the applicable Vesting
Date,
in an amount in cash equal to the amount of any dividend which otherwise
would
have been paid to the Participant if such unvested shares had been issued
for
the benefit of the Participant on the record dates for such dividend payments,
subject to any applicable withholding for Taxes. Such dividend
equivalent payments may be settled by the Company subject to such other
conditions or terms that the Committee may establish. Except for dividend
equivalent payments, the Participant shall have no rights as a stockholder,
including voting rights, with respect to the RSUs.
5.
Termination
of Relationship with the Company
. If the Participant ceases
to be a director of the Company, for any reason, any portion of the Award
that
has not become vested on or prior to the date of such cessation shall
immediately be forfeited.
6.
Award
Not Transferable
. The Award will not be assignable or
transferable by the Participant, except by operation of law, or by will or
the
laws of descent and distribution.
7.
Transferability
of Award Shares
. Until registered under the Securities Act
of 1933, as amended, or any successor statute (the “Securities Act”), the shares
of Common Stock represented by the RSUs will be of an illiquid nature and
will
be deemed to be “restricted securities” for purposes of the Securities
Act. Accordingly, such shares must be sold in compliance with the
registration requirements of the Securities Act or an exemption
therefrom. The Company reserves the right to place restrictions
required by law on any shares of the Company’s Common Stock received by the
Participant pursuant to the Award.
8.
Conformity
with the Plan.
The Award is intended to conform in all
respects with, and is subject to applicable provisions of, the Plan. To the
extent that any provision of this Agreement conflicts with the express terms
of
the Plan, it is hereby acknowledged and agreed that the terms of the Plan
shall
control and, if necessary, the applicable provisions of this Agreement shall
be
deemed to be amended so as to carry out the purpose and intent of the Plan.
By
the Participant’s acceptance of this Agreement, the Participant agrees to be
bound by all of the terms of this Agreement and the
Plan. Notwithstanding any other provision of this Section 8, in the
event that the provisions of this Agreement are subject to Section 409A of
the
Internal Revenue Code of 1986, as amended, and the Treasury Regulations
promulgated thereunder (“Section 409A”), the provisions of this Agreement shall
comply with, and shall be interpreted in a manner consistent with, Section
409A.
9.
No
Rights to Continued Board Service.
Nothing in this Agreement
confers any right on the Participant to continue as a director of the Company
or
a Subsidiary or affects in any way the right of any of the Company or a
Subsidiary to terminate any such relationship of the Participant.
10.
Miscellaneous
.
(a)
Notices.
All
notices hereunder shall be in writing and shall be deemed given when sent
by
certified or registered mail, postage prepaid, return receipt requested,
if to
the Participant, to the address set forth above or at the address shown on
the
records of the Company, and if to the Company, to the Company’s principal
executive offices, attention of the Chief Financial Officer.
(b)
Entire
Agreement; Modification.
This Agreement, together with the
Plan, constitutes the entire agreement between the parties relative to the
subject matter hereof, and supersedes all proposals, written or oral, and
all
other communications between the parties relating to the subject matter of
this
Agreement. The Company may amend, suspend or terminate the Plan, this
Agreement and the Award granted hereunder at any time; provided, however,
that
no such amendment, suspension or termination may materially impair any Award
without the Participant’s written consent.
(c)
Fractional Shares.
If the shares under this Award
become issuable for a fraction of a share because of the adjustment provisions
contained in the Plan, such fraction shall be rounded down to the nearest
whole
share.
(d)
Severability.
The
invalidity, illegality or unenforceability of any provision of this Agreement
shall in no way affect the validity, legality or enforceability of any other
provision.
(e)
Successors
and Assigns.
Except as provided herein, this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, subject to the limitations set forth in
Section 6 hereof.
(f)
Governing Law.
This Agreement shall be governed by
and interpreted in accordance with the laws of the Commonwealth of
Massachusetts
,
without giving effect to the principles of the
conflicts of laws thereof.
(g)
Data
Protection Waiver.
The Participant understands and consent
to the Company or its agents or independent contractors appointed to administer
the Plan obtaining certain of the Participant’s personal employment information
required for the effective administration of the Plan and that such information
may be transmitted outside of the country of the Participant’s employment and/or
residence.
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