EXHIBIT 99.2
STRESSGEN BIOTECHNOLOGIES CORPORATION
2001 EQUITY INCENTIVE PLAN
STOCK OPTION AGREEMENT
(INCENTIVE STOCK OPTION OR NONSTATUTORY STOCK OPTION)
Pursuant to your Stock Option Grant Notice ("Grant Notice") and this
Stock Option Agreement, Stressgen Biotechnologies Corporation (the "Company")
has granted you an option under its 2001 Equity Incentive Plan (the "Plan") to
purchase the number of shares of the Company's Common Stock indicated in your
Grant Notice at the exercise price indicated in your Grant Notice. Defined terms
not explicitly defined in this Stock Option Agreement but defined in the Plan
shall have the same definitions as in the Plan.
The details of your option are as follows:
1. VESTING. Subject to the limitations contained herein, your
option will vest as provided in your Grant Notice, provided that vesting will
cease upon the termination of your Continuous Service.
2. NUMBER OF SHARES AND EXERCISE PRICE. The number of shares of
Common Stock subject to your option and your exercise price per share referenced
in your Grant Notice may be adjusted from time to time for Capitalization
Adjustments, as provided in the Plan.
3. METHOD OF PAYMENT. Payment of the exercise price is due in
full upon exercise of all or any part of your option. You may elect to make
payment of the exercise price in cash or by check or in any other manner
PERMITTED BY YOUR GRANT NOTICE, which may include one or more of the following:
a. In the Company's sole discretion at the time your option is
exercised and provided that at the time of exercise the Common
Stock is publicly traded and quoted regularly in THE WALL
STREET JOURNAL, pursuant to a program developed under
Regulation T as promulgated by the Federal Reserve Board that,
prior to the issuance of Common Stock, results in either the
receipt of cash (or check) by the Company or the receipt of
irrevocable instructions to pay the aggregate exercise price
to the Company from the sales proceeds.
b. Provided that at the time of exercise the Common Stock is
publicly traded and quoted regularly in THE WALL STREET
JOURNAL, by delivery of already-owned shares of Common Stock
either that you have held for the period required to avoid a
charge to the Company's reported earnings (generally six
months) or that you did not acquire, directly or indirectly
from the Company, that are owned free and clear of any liens,
claims, encumbrances or security interests, and that are
valued at Fair Market Value on the date of exercise.
"Delivery" for these purposes, in the sole discretion of the
Company at the time you exercise your option, shall
include delivery to the Company of your attestation of
ownership of such shares of Common Stock in a form approved
by the Company. Notwithstanding the foregoing, you may not
exercise your option by tender to the Company of Common
Stock to the extent such tender would violate the
provisions of any law, regulation or agreement restricting
the redemption of the Company's stock.
4. WHOLE SHARES. You may exercise your option only for whole
shares of Common Stock.
5. SECURITIES LAW COMPLIANCE. Notwithstanding anything to the
contrary contained herein, you may not exercise your option unless the shares of
Common Stock issuable upon such exercise are then registered under the
Securities Act or, if such shares of Common Stock are not then so registered,
the Company has determined that such exercise and issuance would be exempt from
the registration requirements of the Securities Act. The exercise of your option
must also comply with other applicable laws and regulations governing your
option, and you may not exercise your option if the Company determines that such
exercise would not be in material compliance with such laws and regulations.
6. TERM. You may not exercise your option before the commencement
of its term or after its term expires. The term of your option commences on the
Date of Grant and expires upon the EARLIEST of the following:
a. as of the date of the termination of your Continuous Service
if such termination is for Cause;
b. three (3) months after the termination of your Continuous
Service for any reason other than Cause or your Disability or
death, provided that if during any part of such three (3)
month period your option is not exercisable solely because of
the condition set forth in the preceding paragraph relating to
"Securities Law Compliance," your option shall not expire
until the earlier of the Expiration Date or until it shall
have been exercisable for an aggregate period of three (3)
months after the termination of your Continuous Service;
c. twelve (12) months after the termination of your Continuous
Service due to your Disability;
d. twelve (12) months after your death if you die either during
your Continuous Service or within three (3) months after your
Continuous Service terminates;
e. the Expiration Date indicated in your Grant Notice; or
f. the day before the tenth (10th) anniversary of the Date of
Xxxxx.
If your option is an incentive stock option, note that, to obtain the
federal income tax advantages associated with an "incentive stock option," the
Code requires that at all times beginning on the date of grant of your option
and ending on the day three (3) months before the date of your option's
exercise, you must be an employee of the Company or an Affiliate, except in the
event of your death or Disability. The Company has provided for extended
exercisability
of your option under certain circumstances for your benefit but cannot
guarantee that your option will necessarily be treated as an "incentive stock
option" if you continue to provide services to the Company or an Affiliate as
a Consultant or Director after your employment terminates or if you otherwise
exercise your option more than three (3) months after the date your
employment terminates.
7. EXERCISE.
a. You may exercise the vested portion of your option (and the
unvested portion of your option if your Grant Notice so
permits) during its term by delivering a Notice of Exercise
(in a form designated by the Company) together with the
exercise price to the Secretary of the Company, or to such
other person as the Company may designate, during regular
business hours, together with such additional documents as the
Company may then require.
b. By exercising your option you agree that, as a condition to
any exercise of your option, the Company may require you to
enter into an arrangement providing for the payment by you to
the Company of any tax withholding obligation of the Company
arising by reason of (1) the exercise of your option, (2) the
lapse of any substantial risk of forfeiture to which the
shares of Common Stock are subject at the time of exercise, or
(3) the disposition of shares of Common Stock acquired upon
such exercise.
c. If your option is an incentive stock option, by exercising
your option you agree that you will notify the Company in
writing within fifteen (15) days after the date of any
disposition of any of the shares of the Common Stock issued
upon exercise of your option that occurs within two (2) years
after the date of your option grant or within one (1) year
after such shares of Common Stock are transferred upon
exercise of your option.
d. By exercising your option you agree that the Company (or a
representative of the underwriter(s)) may, in connection with
the first underwritten registration of the offering of any
securities of the Company under the Securities Act, require
that you not sell, dispose of, transfer, make any short sale
of, grant any option for the purchase of, or enter into any
hedging or similar transaction with the same economic effect
as a sale, any shares of Common Stock or other securities of
the Company held by you, for a period of time specified by the
underwriter(s) (not to exceed one hundred eighty (180) days)
following the effective date of the registration statement of
the Company filed under the Securities Act. You further agree
to execute and deliver such other agreements as may be
reasonably requested by the Company and/or the underwriter(s)
that are consistent with the foregoing or that are necessary
to give further effect thereto. In order to enforce the
foregoing covenant, the Company may impose stop-transfer
instructions with respect to your shares of Common Stock until
the end of such period. The underwriters of the Company's
stock are intended third party beneficiaries of this Section
7(d) and shall have the right, power and authority to enforce
the provisions hereof as though they were a party hereto.
8. TRANSFERABILITY. Your option is not transferable, except by
will or by the laws of descent and distribution, and is exercisable during your
life only by you. Notwithstanding the foregoing, by delivering written notice to
the Company, in a form satisfactory to the Company, you may designate a third
party who, in the event of your death, shall thereafter be entitled to exercise
your option.
9. RIGHT OF FIRST REFUSAL. Shares of Common Stock that you
acquire upon exercise of your option are subject to any right of first refusal
that may be described in the Company's bylaws in effect at such time the Company
elects to exercise its right. The Company's right of first refusal shall expire
on the Listing Date.
10. RIGHT OF REPURCHASE. To the extent provided in the Company's
bylaws as amended from time to time, the Company shall have the right to
repurchase all or any part of the shares of Common Stock you acquire pursuant to
the exercise of your option.
11. OPTION NOT A SERVICE CONTRACT. Your option is not an
employment or service contract, and nothing in your option shall be deemed to
create in any way whatsoever any obligation on your part to continue in the
employ of the Company or an Affiliate, or of the Company or an Affiliate to
continue your employment. In addition, nothing in your option shall obligate the
Company or an Affiliate, their respective shareholders, Boards of Directors,
Officers or Employees to continue any relationship that you might have as a
Director or Consultant for the Company or an Affiliate.
12. WITHHOLDING OBLIGATIONS.
a. At the time you exercise your option, in whole or in part, or
at any time thereafter as requested by the Company, you hereby
authorize withholding from payroll and any other amounts
payable to you, and otherwise agree to make adequate provision
for (including by means of a "cashless exercise" pursuant to a
program developed under Regulation T as promulgated by the
Federal Reserve Board to the extent permitted by the Company),
any sums required to satisfy the federal, state, local and
foreign tax withholding obligations of the Company or an
Affiliate, if any, which arise in connection with your option.
b. Upon your request and subject to approval by the Company,
in its sole discretion, and compliance with any applicable
conditions or restrictions of law, the Company may withhold
from fully vested shares of Common Stock otherwise issuable
to you upon the exercise of your option a number of whole
shares of Common Stock having a Fair Market Value,
determined by the Company as of the date of exercise, not
in excess of the minimum amount of tax required to be
withheld by law. If the date of determination of any tax
withholding obligation is deferred to a date later than the
date of exercise of your option, share withholding pursuant
to the preceding sentence shall not be permitted unless you
make a proper and timely election under Section 83(b) of
the Code, covering the aggregate number of shares of Common
Stock acquired upon such exercise with respect to which
such determination is otherwise deferred, to accelerate the
determination of such tax withholding obligation to the
date of exercise of your
option. Notwithstanding the filing of such election, shares
of Common Stock shall be withheld solely from fully vested
shares of Common Stock determined as of the date of
exercise of your option that are otherwise issuable to you
upon such exercise. Any adverse consequences to you arising
in connection with such share withholding procedure shall
be your sole responsibility.
c. You may not exercise your option unless the tax withholding
obligations of the Company and/or any Affiliate are satisfied.
Accordingly, you may not be able to exercise your option when
desired even though your option is vested, and the Company
shall have no obligation to issue a certificate for such
shares of Common Stock or release such shares of Common Stock
from any escrow provided for herein.
13. NOTICES. Any notices provided for in your option or the Plan
shall be given in writing and shall be deemed effectively given upon receipt or,
in the case of notices delivered by mail by the Company to you, five (5) days
after deposit in the United States or Canadian mail, or one (1) day after
deposit with an internationally recognized overnight courier, specifying next
day delivery, postage prepaid, addressed to you at the last address you provided
to the Company.
14. GOVERNING PLAN DOCUMENT. Your option is subject to all the
provisions of the Plan, the provisions of which are hereby made a part of your
option, and is further subject to all interpretations, amendments, rules and
regulations which may from time to time be promulgated and adopted pursuant to
the Plan. In the event of any conflict between the provisions of your option and
those of the Plan, the provisions of the Plan shall control.
