Exhibit 10.4
AIRVANA, INC.
FORM OF
NONSTATUTORY STOCK OPTION AGREEMENT
GRANTED UNDER 2007 STOCK INCENTIVE PLAN
1. Grant of Option.
This agreement evidences the grant by Airvana, Inc., a Delaware
corporation (the "Company"), on , 200[_] (the "Grant Date") to
[_________], [an employee][a consultant][a director] of the Company (the
"Participant"), of an option to purchase, in whole or in part, on the terms
provided herein and in the Company's 2007 Stock Incentive Plan (the "Plan"), a
total of [________] shares (the "Shares") of common stock, $0.001 par value per
share, of the Company ("Common Stock") at $[_____] per Share. Unless earlier
terminated, this option shall expire at 5:00 p.m., Eastern time, on [_________]
(the "Final Exercise Date").
It is intended that the option evidenced by this agreement shall not be
an incentive stock option as defined in Section 422 of the Internal Revenue Code
of 1986, as amended, and any regulations promulgated thereunder (the "Code").
Except as otherwise indicated by the context, the term "Participant", as used in
this option, shall be deemed to include any person who acquires the right to
exercise this option validly under its terms.
2. Vesting Schedule; Acceleration Upon a Change in Control Event.
(a) This option will become exercisable ("vest") as to [25]% of
the original number of Shares on the first anniversary of the Grant Date and as
to an additional [6.25]% of the original number of Shares at the end of each
successive three-month period following the first anniversary of the Grant Date
until the [fourth] anniversary of the Grant Date.
(b) The right of exercise shall be cumulative so that to the
extent the option is not exercised in any period to the maximum extent
permissible it shall continue to be exercisable, in whole or in part, with
respect to all Shares for which it is vested until the earlier of the Final
Exercise Date or the termination of this option under Section 3 hereof or the
Plan.
(c) Notwithstanding any provision of the Plan to the contrary,
effective immediately prior to a Change in Control Event (as defined below),
except to the extent specifically provided to the contrary in any agreement
between the Participant and the Company, the vesting schedule of this option
shall be accelerated in part so that the number of shares that would otherwise
have first become vested during the [twelve]-month period following the date of
the Change in Control Event shall immediately become exercisable. The remaining
number of shares subject to vesting, if any, shall continue to become vested
(provided that the conditions for continued vesting set forth herein continue to
be satisfied) in accordance with the original vesting schedule set forth in this
option, with the same percentage of the total number of shares subject to this
option that would otherwise have become vested on each subsequent vesting date
in accordance with the original schedule becoming vested on each such subsequent
vesting date until this option is vested in full (with the consequence that this
option, if not becoming fully vested on the
date of such Change in Control Event, will vest in full [twelve] months sooner
than provided in the original vesting schedule).
(d) For purposes of this agreement, "Change in Control Event"
shall mean an event or occurrence that is set forth in any one or more of
clauses (1) through (3) below (including without limitation an event or
occurrence that constitutes a Change in Control Event under one of such clauses
but is specifically exempted from another such clause) and that also constitutes
a "change of control" within the meaning of Section 409A of the Code and the
guidance issued thereunder:
(1) the acquisition by an individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act")) (a "Person") of beneficial
ownership of any capital stock of the Company if, after such acquisition, such
Person beneficially owns (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) 50% or more of either (i) the then-outstanding shares of Common
Stock (the "Outstanding Company Common Stock") or (ii) the combined voting power
of the then-outstanding securities of the Company entitled to vote generally in
the election of directors (the "Outstanding Company Voting Securities");
provided, however, that for purposes of this clause (1), the following
acquisitions shall not constitute a Change in Control Event: (A) any acquisition
directly from the Company (excluding an acquisition pursuant to the exercise,
conversion or exchange of any security exercisable for, convertible into or
exchangeable for common stock or voting securities of the Company, unless the
Person exercising, converting or exchanging such security acquired such security
directly from the Company or an underwriter or agent of the Company), (B) any
acquisition by the Company, (C) any acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the Company or any corporation
controlled by the Company or (D) any acquisition by any corporation pursuant to
a transaction which complies with clauses 2(i) and 2(ii) of this Section 2(d);
or
(2) the consummation of a merger, consolidation,
reorganization, recapitalization or statutory share exchange involving the
Company or a sale or other disposition of all or substantially all of the assets
of the Company in one or a series of transactions (a "Business Combination"),
unless, immediately following such Business Combination, each of the following
two conditions is satisfied: (i) all or substantially all of the individuals and
entities who were the beneficial owners of the Outstanding Company Common Stock
and Outstanding Company Voting Securities immediately prior to such Business
Combination beneficially own, directly or indirectly, more than 50% of the
then-outstanding shares of common stock and the combined voting power of the
then-outstanding securities entitled to vote generally in the election of
directors, respectively, of the resulting or acquiring corporation in such
Business Combination (which shall include, without limitation, a corporation
which as a result of such transaction owns the Company or substantially all of
the Company's assets either directly or through one or more subsidiaries) (such
resulting or acquiring corporation is referred to herein as the "Acquiring
Corporation") in substantially the same proportions as their ownership,
immediately prior to such Business Combination, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities, respectively; and (ii)
no Person (excluding the Acquiring Corporation or any employee benefit plan (or
related trust) maintained or sponsored by the Company or by the Acquiring
Corporation) beneficially owns, directly or indirectly, 35% or more of the then
outstanding shares of common stock of the Acquiring Corporation, or of the
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combined voting power of the then-outstanding securities of such corporation
entitled to vote generally in the election of directors (except to the extent
that such ownership existed prior to the Business Combination); or
(3) the liquidation or dissolution of the Company.
3. Exercise of Option.
(a) Form of Exercise. Each election to exercise this option shall
be in writing, signed by the Participant, and received by the Company at its
principal office, accompanied by this agreement, and payment in full in the
manner provided in the Plan. The Participant may purchase less than the number
of shares covered hereby, provided that no partial exercise of this option may
be for any fractional share.
(b) Continuous Relationship with the Company Required. Except as
otherwise provided in this Section 3, this option may not be exercised unless
the Participant, at the time he or she exercises this option, is, and has been
at all times since the Grant Date, an employee or officer of, or consultant or
advisor to, the Company or any other entity the employees, officers, directors,
consultants, or advisors of which are eligible to receive option grants under
the Plan (an "Eligible Participant")
(c) Termination of Relationship with the Company. If the
Participant ceases to be an Eligible Participant for any reason, then, except as
provided in paragraphs (d) and (e) below, the right to exercise this option
shall terminate three months after such cessation (but in no event after the
Final Exercise Date), provided that this option shall be exercisable only to the
extent that the Participant was entitled to exercise this option on the date of
such cessation. Notwithstanding the foregoing, if the Participant, prior to the
Final Exercise Date, violates the non-competition or confidentiality provisions
of any employment contract, confidentiality and nondisclosure agreement or other
agreement between the Participant and the Company, the right to exercise this
option shall terminate immediately upon written notice to the Participant from
the Company describing such violation.
(d) Exercise Period Upon Death or Disability. If the Participant
dies or becomes disabled (within the meaning of Section 22(e)(3) of the Code)
prior to the Final Exercise Date while he or she is an Eligible Participant and
the Company has not terminated such relationship for "cause" as specified in
paragraph (e) below, this option shall be exercisable, within the period of one
year following the date of death or disability of the Participant, by the
Participant (or in the case of death by an authorized transferee), provided that
this option shall be exercisable only to the extent that this option was
exercisable by the Participant on the date of his or her death or disability,
and further provided that this option shall not be exercisable after the Final
Exercise Date.
(e) Termination for Cause. If, prior to the Final Exercise Date,
the Participant's employment or other relationship with the Company is
terminated by the Company for Cause (as defined below), the right to exercise
this option shall terminate immediately upon the effective date of such
termination of employment or other relationship. If the Participant is party to
an employment, consulting or severance agreement with the Company that contains
a definition of
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"cause" for termination of employment or other relationship, "Cause" shall have
the meaning ascribed to such term in such agreement. Otherwise, "Cause" shall
mean willful misconduct by the Participant or willful failure by the Participant
to perform his or her responsibilities to the Company (including, without
limitation, breach by the Participant of any provision of any employment,
consulting, advisory, nondisclosure, non-competition or other similar agreement
between the Participant and the Company), as determined by the Company, which
determination shall be conclusive. The Participant shall be considered to have
been discharged for "Cause" if the Company determines, within 30 days after the
Participant's resignation, that discharge for cause was warranted.
4. Withholding.
No Shares will be issued pursuant to the exercise of this option unless
and until the Participant pays to the Company, or makes provision satisfactory
to the Company for payment of, any federal, state or local withholding taxes
required by law to be withheld in respect of this option.
5. Nontransferability of Option.
This option may not be sold, assigned, transferred, pledged or
otherwise encumbered by the Participant, either voluntarily or by operation of
law, except by will or the laws of descent and distribution, and, during the
lifetime of the Participant, this option shall be exercisable only by the
Participant.
6. Provisions of the Plan.
This option is subject to the provisions of the Plan, a copy of which
is furnished to the Participant with this option.
IN WITNESS WHEREOF, the Company has caused this option to be executed
under its corporate seal by its duly authorized officer. This option shall take
effect as a sealed instrument.
AIRVANA, INC.
Dated: _________ By: _______________________________
Name: ________________________
Title: ________________________
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PARTICIPANT'S ACCEPTANCE
The undersigned hereby accepts the foregoing option and agrees to the terms
and conditions thereof. The undersigned hereby acknowledges receipt of a copy of
the Company's 2007 Stock Incentive Plan.
PARTICIPANT:
___________________________________
Address: __________________________
__________________________
NOTICE OF GRANT OF NONSTATUTORY AIRVANA, INC.
STOCK OPTION AND OPTION 00 Xxxxx Xxxx
AGREEMENT Xxxxxxxxxx, XX 00000
IRS ID: 00-0000000
PARTICIPANT:
OPTION NUMBER:
PLAN: 2007 STOCK INCENTIVE PLAN
ID:
On the Date of Grant specified below, Airvana, Inc., a Delaware corporation (the
"Company"), awarded you a Nonstatutory Stock Option (this "Option") to purchase,
in whole or in part, on the terms provided in this Notice of Grant, the attached
Nonstatutory Stock Option Agreement (the "Option Agreement") and the Company's
2007 Stock Incentive Plan (the "Plan"), a total number of shares of the
Company's Common Stock (the "Shares") equal to the Number of Shares specified
below at the Exercise Price specified below per Share. Unless earlier
terminated, this Option shall expire at 5:00 p.m., Eastern time, on [the Final
Exercise Date specified below][the day immediately preceding the tenth
anniversary of the Date of Grant (the "Final Exercise Date")].
DATE OF GRANT:
NUMBER OF SHARES:
EXERCISE PRICE:
[FINAL EXERCISE DATE:]
This Option will become exercisable ("vest") as to 25% of the original number of
Shares subject to this Option on the first anniversary of Date of Grant and as
to an additional 6.25% of the original number of Shares subject to this Option
at the end of each successive three-month period following the first anniversary
of Date of Grant until fourth anniversary of Date of Grant.
By your signature and the Company's signature below, you and the Company agree
that this Option is granted under and governed by the terms and conditions of
this Notice of Grant and the Plan and the Option Agreement, both of which are
made a part of this document. By your signature below you acknowledge receipt of
a copy of the Plan and the Option Agreement and you acknowledge that you have
read and will comply with the Company's Xxxxxxx Xxxxxxx Policy.
Airvana, Inc.
By: ____________________________ __________________________
Date
_______________________________ __________________________
Participant Date
AIRVANA, INC.
FORM OF
NONSTATUTORY STOCK OPTION AGREEMENT
GRANTED UNDER 2007 STOCK INCENTIVE PLAN
1. Grant of Option.
It is intended that the Option evidenced by the Notice of Grant to which
this Nonstatutory Stock Option Agreement is attached (the "Notice of Grant") and
this Option Agreement shall not be an incentive stock option as defined in
Section 422 of the Internal Revenue Code of 1986, as amended, and any
regulations promulgated thereunder (the "Code"). Except as otherwise indicated
by the context, the term "Participant", as used in this Option, shall be deemed
to include any person who acquires the right to exercise this Option validly
under its terms.
2. Vesting; Acceleration Upon a Change in Control Event.
(a) The right of exercise of this Option shall be cumulative so that to
the extent the Option is not exercised in any period to the maximum extent
permissible it shall continue to be exercisable, in whole or in part, with
respect to all Shares for which it is vested until the earlier of the Final
Exercise Date or the termination of this Option under Section 3 hereof or the
Plan.
(b) Notwithstanding any provision of the Plan to the contrary, effective
immediately prior to a Change in Control Event (as defined below), except to the
extent specifically provided to the contrary in the Notice of Grant or any
agreement between the Participant and the Company, the vesting schedule of this
Option shall be accelerated in part so that the number of shares that would
otherwise have first become vested during the twelve-month period following the
date of the Change in Control Event shall immediately become exercisable. The
remaining number of shares subject to vesting, if any, shall continue to become
vested (provided that the conditions for continued vesting set forth herein
continue to be satisfied) in accordance with the original vesting schedule set
forth in this Option, with the same percentage of the total number of shares
subject to this Option that would otherwise have become vested on each
subsequent vesting date in accordance with the original schedule becoming vested
on each such subsequent vesting date until this Option is vested in full (with
the consequence that this Option, if not becoming fully vested on the date of
such Change in Control Event, will vest in full twelve months sooner than
provided in the original vesting schedule).
(c) For purposes of this agreement, "Change in Control Event" shall mean
an event or occurrence that is set forth in any one or more of clauses (1)
through (3) below (including without limitation an event or occurrence that
constitutes a Change in Control Event under one of such clauses but is
specifically exempted from another such clause) and that also constitutes a
"change of control" within the meaning of Section 409A of the Code and the
guidance issued thereunder:
(1) the acquisition by an individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act")) (a "Person") of beneficial ownership of any
capital stock of the Company if, after such
acquisition, such Person beneficially owns (within the meaning of Rule 13d-3
promulgated under the Exchange Act) 50% or more of either (i) the
then-outstanding shares of Common Stock (the "Outstanding Company Common Stock")
or (ii) the combined voting power of the then-outstanding securities of the
Company entitled to vote generally in the election of directors (the
"Outstanding Company Voting Securities"); provided, however, that for purposes
of this clause (1), the following acquisitions shall not constitute a Change in
Control Event: (A) any acquisition directly from the Company (excluding an
acquisition pursuant to the exercise, conversion or exchange of any security
exercisable for, convertible into or exchangeable for common stock or voting
securities of the Company, unless the Person exercising, converting or
exchanging such security acquired such security directly from the Company or an
underwriter or agent of the Company), (B) any acquisition by the Company, (C)
any acquisition by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation controlled by the Company or (D)
any acquisition by any corporation pursuant to a transaction which complies with
clauses 2(i) and 2(ii) of this Section 2(c); or
(2) the consummation of a merger, consolidation, reorganization,
recapitalization or statutory share exchange involving the Company or a sale or
other disposition of all or substantially all of the assets of the Company in
one or a series of transactions (a "Business Combination"), unless, immediately
following such Business Combination, each of the following two conditions is
satisfied: (i) all or substantially all of the individuals and entities who were
the beneficial owners of the Outstanding Company Common Stock and Outstanding
Company Voting Securities immediately prior to such Business Combination
beneficially own, directly or indirectly, more than 50% of the then-outstanding
shares of common stock and the combined voting power of the then-outstanding
securities entitled to vote generally in the election of directors,
respectively, of the resulting or acquiring corporation in such Business
Combination (which shall include, without limitation, a corporation which as a
result of such transaction owns the Company or substantially all of the
Company's assets either directly or through one or more subsidiaries) (such
resulting or acquiring corporation is referred to herein as the "Acquiring
Corporation") in substantially the same proportions as their ownership,
immediately prior to such Business Combination, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities, respectively; and (ii)
no Person (excluding the Acquiring Corporation or any employee benefit plan (or
related trust) maintained or sponsored by the Company or by the Acquiring
Corporation) beneficially owns, directly or indirectly, 35% or more of the then
outstanding shares of common stock of the Acquiring Corporation, or of the
combined voting power of the then-outstanding securities of such corporation
entitled to vote generally in the election of directors (except to the extent
that such ownership existed prior to the Business Combination); or
(3) the liquidation or dissolution of the Company.
3. Exercise of Option.
(a) Form of Exercise. Each election to exercise this Option shall be in
writing, signed by the Participant, and received by the Company at its principal
office, accompanied by this agreement, and payment in full in the manner
provided in the Plan. The Participant may purchase less than the number of
Shares covered hereby, provided that no partial exercise of this Option may be
for any fractional share.
(b) Continuous Relationship with the Company Required. Except as otherwise
provided in this Section 3, this Option may not be exercised unless the
Participant, at the time he or she exercises this Option, is, and has been at
all times since the Date of Grant, an employee or officer of, or consultant or
advisor to, the Company or any other entity the employees, officers, directors,
consultants, or advisors of which are eligible to receive option grants under
the Plan (an "Eligible Participant").
(c) Termination of Relationship with the Company. If the Participant
ceases to be an Eligible Participant for any reason, then, except as provided in
paragraphs (d) and (e) below, the right to exercise this Option shall terminate
three months after such cessation (but in no event after the Final Exercise
Date), provided that this Option shall be exercisable only to the extent that
the Participant was entitled to exercise this Option on the date of such
cessation. Notwithstanding the foregoing, if the Participant, prior to the Final
Exercise Date, violates the non-competition or confidentiality provisions of any
employment contract, confidentiality and nondisclosure agreement or other
agreement between the Participant and the Company, the right to exercise this
Option shall terminate immediately upon written notice to the Participant from
the Company describing such violation.
(d) Exercise Period Upon Death or Disability. If the Participant dies or
becomes disabled (within the meaning of Section 22(e)(3) of the Code) prior to
the Final Exercise Date while he or she is an Eligible Participant and the
Company has not terminated such relationship for "cause" as specified in
paragraph (e) below, this Option shall be exercisable, within the period of one
year following the date of death or disability of the Participant, by the
Participant (or in the case of death by an authorized transferee), provided that
this Option shall be exercisable only to the extent that this Option was
exercisable by the Participant on the date of his or her death or disability,
and further provided that this Option shall not be exercisable after the Final
Exercise Date.
(e) Termination for Cause. If, prior to the Final Exercise Date, the
Participant's employment or other relationship with the Company is terminated by
the Company for Cause (as defined below), the right to exercise this Option
shall terminate immediately upon the effective date of such termination of
employment or other relationship. If the Participant is party to an employment,
consulting or severance agreement with the Company that contains a definition of
"cause" for termination of employment or other relationship, "Cause" shall have
the meaning ascribed to such term in such agreement. Otherwise, "Cause" shall
mean willful misconduct by the Participant or willful failure by the Participant
to perform his or her responsibilities to the Company (including, without
limitation, breach by the Participant of any provision of any employment,
consulting, advisory, nondisclosure, non-competition or other similar agreement
between the Participant and the Company), as determined by the Company, which
determination shall be conclusive. The Participant shall be considered to have
been discharged for Cause if the Company determines, within 30 days after the
Participant's resignation, that discharge for cause was warranted.
4. Withholding. No Shares will be issued pursuant to the exercise of this Option
unless and until the Participant pays to the Company, or makes provision
satisfactory to the Company for payment of, any federal, state or local
withholding taxes required by law to be withheld in respect of this Option.
5. Nontransferability of Option.
This Option may not be sold, assigned, transferred, pledged or otherwise
encumbered by the Participant, either voluntarily or by operation of law, except
by will or the laws of descent and distribution, and, during the lifetime of the
Participant, this Option shall be exercisable only by the Participant.
6. Provisions of the Plan.
This Option is subject to the provisions of the Plan, a copy of which is
furnished to the Participant with this Option.
NOTICE OF GRANT OF STOCK OPTIONS AND AIRVANA, INC.
OPTION AGREEMENT IRS ID: 00-0000000
00 Xxxxx Xxxx
Xxxxxxxxxx, XX 00000
[PARTICIPANT NAME] OPTION NUMBER: _________________________
[PARTICIPANT ADDRESS] PLAN: __________________________________
ID: ____________________________________
Effective [_____], you have been granted a Nonstatutory Stock Option to buy
[_____] shares of Airvana, Inc. (the Company) stock at $[_____] per share.
The total option price of the shares granted is $[_____].
Shares in each period will become fully vested on the date shown.
Shares Vest Type Full Vest Expiration
------ --------- --------- ----------
By your signature and the Company's signature below, you and the Company agree
that these options are granted under and governed by the terms and conditions of
the Company's Stock Option Plan and the Option Agreement, all of which are
attached and made a part of this document.
------------------------------------- ----------------------------------------
Airvana, Inc. Date
------------------------------------- ----------------------------------------
[Participant Name] Date
AIRVANA, INC.
NONSTATUTORY STOCK OPTION AGREEMENT
GRANTED UNDER 2007 STOCK INCENTIVE PLAN
1. Grant of Option.
On the date of grant (the "Date of Grant") specified in the first sentence
of the Notice of Grant of Stock Options to which this Nonstatutory Stock Option
Agreement is attached (the "Notice of Grant"), Airvana, Inc., a Delaware
corporation (the "Company"), awarded you an Nonstatutory Stock Option (this
"Option") to purchase, in whole or in part, on the terms provided in the
attached Notice of Grant (except to the extent superseded by this Nonstatutory
Stock Option Agreement), this Nonstatutory Stock Option Agreement (the "Option
Agreement") and the Company's 2007 Stock Incentive Plan (the "Plan"), a total
number of shares of the Company's Common Stock (the "Shares") equal to the
number of shares specified in the first sentence of the Notice of Grant at the
exercise price per Share specified in the first sentence of the Notice of Grant
(the "Exercise Price"). Unless earlier terminated, notwithstanding the date set
forth in the table in the Notice of Grant under the column "Expiration", this
Option shall expire at 5:00 p.m., Eastern time, on the day immediately preceding
the tenth anniversary of the Date of Grant (the "Final Exercise Date").
YOU SHOULD NOT RELY ON THE INFORMATION PROVIDED IN THE THIRD SENTENCE OF
THE NOTICE OF GRANT AND THE TABLE THAT FOLLOWS THE THIRD SENTENCE OF THE NOTICE
OF GRANT. TO THE EXTENT THAT THE TERMS OF THIS OPTION AGREEMENT DIFFER FROM THE
INFORMATION DISCLOSED IN THOSE PORTIONS OF THE NOTICE OF GRANT, THE TERMS OF
THIS OPTION AGREEMENT SHALL CONTROL.
It is intended that the Option evidenced by the Notice of Grant and this
Option Agreement shall not be an incentive stock option as defined in Section
422 of the Internal Revenue Code of 1986, as amended, and any regulations
promulgated thereunder (the "Code"). Except as otherwise indicated by the
context, the term "Participant", as used in this Option, shall be deemed to
include any person who acquires the right to exercise this Option validly under
its terms.
2. Vesting; Acceleration Upon a Change in Control Event.
(a) Notwithstanding any implication to the contrary in the table that
follows the third sentence of the Notice of Grant, this Option will become
exercisable ("vest") as to [_____]% of the original number of Shares subject to
this Option on [_____].
(b) The right of exercise of this Option shall be cumulative so that to the
extent the Option is not exercised in any period to the maximum extent
permissible it shall continue to be exercisable, in whole or in part, with
respect to all Shares for which it is vested until the earlier of the Final
Exercise Date or the termination of this Option under Section 3 hereof or the
Plan.
(c) Notwithstanding any provision of the Plan to the contrary, effective
immediately prior to a Change in Control Event (as defined below), except to the
extent specifically provided to the contrary in the Notice of Grant or any
agreement between the Participant and the Company, the vesting schedule of this
Option shall be accelerated in part so that the number of shares that would
otherwise have first become vested during the twelve-month period following the
date of the Change in Control Event shall immediately become exercisable. The
remaining number of shares subject to vesting, if any, shall continue to become
vested (provided that the conditions for continued vesting set forth herein
continue to be satisfied) in accordance with the original vesting schedule set
forth in this Option, with the same percentage of the total number of shares
subject to this Option that would otherwise have become vested on each
subsequent vesting date in accordance with the original schedule becoming vested
on each such subsequent vesting date until this Option is vested in full (with
the consequence that this Option, if not becoming fully vested on the date of
such Change in Control Event, will vest in full twelve months sooner than
provided in the original vesting schedule).
(d) For purposes of this agreement, "Change in Control Event" shall mean an
event or occurrence that is set forth in any one or more of clauses (1) through
(3) below (including without limitation an event or occurrence that constitutes
a Change in Control Event under one of such clauses but is specifically exempted
from another such clause) and that also constitutes a "change of control" within
the meaning of Section 409A of the Code and the guidance issued thereunder:
(1) the acquisition by an individual, entity or group (within the
meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act")) (a "Person") of beneficial ownership of any
capital stock of the Company if, after such acquisition, such Person
beneficially owns (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) 50% or more of either (i) the then-outstanding shares of Common
Stock (the "Outstanding Company Common Stock") or (ii) the combined voting power
of the then-outstanding securities of the Company entitled to vote generally in
the election of directors (the "Outstanding Company Voting Securities");
provided, however, that for purposes of this clause (1), the following
acquisitions shall not constitute a Change in Control Event: (A) any acquisition
directly from the Company (excluding an acquisition pursuant to the exercise,
conversion or exchange of any security exercisable for, convertible into or
exchangeable for common stock or voting securities of the Company, unless the
Person exercising, converting or exchanging such security acquired such security
directly from the Company or an underwriter or agent of the Company), (B) any
acquisition by the Company, (C) any acquisition by any employee benefit plan (or
related trust) sponsored or maintained by the Company or any corporation
controlled by the Company or (D) any acquisition by any corporation pursuant to
a transaction which complies with clauses 2(i) and 2(ii) of this Section 2(d);
or
(2) the consummation of a merger, consolidation, reorganization,
recapitalization or statutory share exchange involving the Company or a sale or
other disposition of all or substantially all of the assets of the Company in
one or a series of transactions (a "Business Combination"), unless, immediately
following such Business Combination, each of the following two conditions is
satisfied: (i) all or substantially all of the individuals and entities who were
the beneficial owners of the Outstanding Company Common Stock and Outstanding
Company Voting Securities immediately prior to such Business Combination
beneficially own,
directly or indirectly, more than 50% of the then-outstanding shares of common
stock and the combined voting power of the then-outstanding securities entitled
to vote generally in the election of directors, respectively, of the resulting
or acquiring corporation in such Business Combination (which shall include,
without limitation, a corporation which as a result of such transaction owns the
Company or substantially all of the Company's assets either directly or through
one or more subsidiaries) (such resulting or acquiring corporation is referred
to herein as the "Acquiring Corporation") in substantially the same proportions
as their ownership, immediately prior to such Business Combination, of the
Outstanding Company Common Stock and Outstanding Company Voting Securities,
respectively; and (ii) no Person (excluding the Acquiring Corporation or any
employee benefit plan (or related trust) maintained or sponsored by the Company
or by the Acquiring Corporation) beneficially owns, directly or indirectly, 35%
or more of the then outstanding shares of common stock of the Acquiring
Corporation, or of the combined voting power of the then-outstanding securities
of such corporation entitled to vote generally in the election of directors
(except to the extent that such ownership existed prior to the Business
Combination); or
(3) the liquidation or dissolution of the Company.
3. Exercise of Option.
(a) Form of Exercise. Each election to exercise this Option shall be in
writing, signed by the Participant, and received by the Company at its principal
office, accompanied by this agreement, and payment in full in the manner
provided in the Plan. The Participant may purchase less than the number of
Shares covered hereby, provided that no partial exercise of this Option may be
for any fractional share.
(b) Continuous Relationship with the Company Required. Except as otherwise
provided in this Section 3, this Option may not be exercised unless the
Participant, at the time he or she exercises this Option, is, and has been at
all times since the Date of Grant, an employee or officer of, or consultant or
advisor to, the Company or any other entity the employees, officers, directors,
consultants, or advisors of which are eligible to receive option grants under
the Plan (an "Eligible Participant").
(c) Termination of Relationship with the Company. If the Participant ceases
to be an Eligible Participant for any reason, then, except as provided in
paragraphs (d) and (e) below, the right to exercise this Option shall terminate
three months after such cessation (but in no event after the Final Exercise
Date), provided that this Option shall be exercisable only to the extent that
the Participant was entitled to exercise this Option on the date of such
cessation. Notwithstanding the foregoing, if the Participant, prior to the Final
Exercise Date, violates the non-competition or confidentiality provisions of any
employment contract, confidentiality and nondisclosure agreement or other
agreement between the Participant and the Company, the right to exercise this
Option shall terminate immediately upon written notice to the Participant from
the Company describing such violation.
(d) Exercise Period Upon Death or Disability. If the Participant dies or
becomes disabled (within the meaning of Section 22(e)(3) of the Code) prior to
the Final Exercise Date while he or she is an Eligible Participant and the
Company has not terminated such relationship
for "cause" as specified in paragraph (e) below, this Option shall be
exercisable, within the period of one year following the date of death or
disability of the Participant, by the Participant (or in the case of death by an
authorized transferee), provided that this Option shall be exercisable only to
the extent that this Option was exercisable by the Participant on the date of
his or her death or disability, and further provided that this Option shall not
be exercisable after the Final Exercise Date.
(e) Termination for Cause. If, prior to the Final Exercise Date, the
Participant's employment or other relationship with the Company is terminated by
the Company for Cause (as defined below), the right to exercise this Option
shall terminate immediately upon the effective date of such termination of
employment or other relationship. If the Participant is party to an employment,
consulting or severance agreement with the Company that contains a definition of
"cause" for termination of employment or other relationship, "Cause" shall have
the meaning ascribed to such term in such agreement. Otherwise, "Cause" shall
mean willful misconduct by the Participant or willful failure by the Participant
to perform his or her responsibilities to the Company (including, without
limitation, breach by the Participant of any provision of any employment,
consulting, advisory, nondisclosure, non-competition or other similar agreement
between the Participant and the Company), as determined by the Company, which
determination shall be conclusive. The Participant shall be considered to have
been discharged for Cause if the Company determines, within 30 days after the
Participant's resignation, that discharge for cause was warranted.
4. Withholding. No Shares will be issued pursuant to the exercise of this Option
unless and until the Participant pays to the Company, or makes provision
satisfactory to the Company for payment of, any federal, state or local
withholding taxes required by law to be withheld in respect of this Option.
5. Nontransferability of Option.
This Option may not be sold, assigned, transferred, pledged or otherwise
encumbered by the Participant, either voluntarily or by operation of law, except
by will or the laws of descent and distribution, and, during the lifetime of the
Participant, this Option shall be exercisable only by the Participant.
6. Provisions of the Plan.
This Option is subject to the provisions of the Plan, a copy of which is
furnished to the Participant with this Option.
