Velcera, Inc. Stock Option Agreement (Non-Statutory)
EXHIBIT
10.2
(Non-Statutory)
This
Stock Option Agreement is made and entered into as of May 25, 2007 between
Xxxxxx X. Xxxxxxxx (“Optionee”)
and
Velcera, Inc., a Delaware corporation (the “Company”).
Background
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A.
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Optionee
is the chief executive officer of the Company. In consideration
of
Optionee’s service to the Company, the Company wishes to grant to Optionee
an option to purchase 280,000 shares of the Company’s common stock
according to the terms hereof.
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B.
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The
Company has adopted the 2007 Stock Option Plan (the “Plan”)
pursuant to which shares of the Company’s common stock are reserved for
issuance under the Plan.
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Now,
Therefore,
the
parties hereto agree as follows:
1. Incorporation
by Reference.
The
terms and conditions of the Plan, a copy of which has been delivered to
Optionee, are hereby incorporated herein and made a part hereof by reference
as
if set forth in full. In the event of any conflict or inconsistency between
the
provisions of this Agreement and those of the Plan, the provisions of the
Plan
will govern and control.
2. Grant
of Option; Purchase Price.
Subject
to the terms and conditions herein set forth, the Company hereby irrevocably
grants to Optionee from the Plan the right and option, hereinafter called
the
“Option”,
to
purchase all or any part of an aggregate of the number of shares of common
stock
of the Company (the “Shares”)
set
forth at the end of this Agreement after “Number
of Shares”
at
the
price per Share set forth at the end of this Agreement after “Exercise
Price”.
3. Exercise
and Vesting of Option.
The
Option is exercisable only to the extent that all, or any portion thereof,
has
vested in the Optionee. Except as set forth in Sections 4 and 5 below, 155,000
Shares will vest only
upon
Optionee’s
attainment of certain performance standards set by the Company’s board of
directors (the
“Performance
Shares”).
The
Performance Shares will be available for performance-based vesting, at the
sole
discretion of the Company’s board of directors, on the vesting dates set forth
below
(each
such date is referred to herein as a “Vesting
Date”).
To the
extent any Performance Shares available for vesting on a given Vesting Date
are
not deemed vested by the Company’s board of directors on such date, such
Performance Shares will be available for performance-based vesting on future
Vesting Dates. Any Performance Shares not deemed vested by the Company’s board
of directors on or prior to December 31, 2009 will be forfeited as of such
date.
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Performance
Shares
Available
for Vesting
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Vesting
Date
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38,750
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December
31, 2007
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58,125
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December
31, 2008
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58,125
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December
31, 2009
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Except
as
set forth in Sections 4 and 5 below,
the
remaining 125,000
Shares
will vest as set forth in the following table,
in each
case so long as Optionee continues to be employed by the Company:
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Shares
Subject
to
Vesting Date
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Vesting
Date
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31,250
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December
31, 2007
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46,875
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December
31,
2008
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46,875
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December
31,
2009
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4. Termination
of Employment.
In the
event that the Optionee ceases to be employed with the Company, any unvested
portion of the Option as of the date thereof will vest. Notwithstanding the
above, upon the Company terminating Optionee for “Cause” (as defined in the
employment agreement between the Company and Optionee dated April 20, 2004
(the
“Employment
Agreement”))
or
Optionee terminating his employment without “Good Reason” (as defined in the
Employment Agreement), any then unvested portion of the Option will be forfeited
and cancelled and in the event Optionee is no longer employed by the Company
due
to Optionee’s death or Disability (as defined in the Employment Agreement), any
portion of the Option other than that which is scheduled to,
or will
be available to (in the case of Performance Shares),
vest on
the next succeeding Vesting Date
will be
forfeited as of such date.
5. Change
of Control.
Upon a
“Change of Control” (as defined in the Employment Agreement) resulting in the
Company or its stockholders receiving at least $50,000,000 in value, any
then
unvested portion of the Option will immediately vest as of the date of the
“Change of Control”. Upon a “Change of Control” resulting in the Company or its
stockholders receiving less than $50,000,000 in value, the portion of the
Option
that is scheduled to,
or will
be available to (in the case of Performance Shares),
vest on
the next succeeding Vesting Date will
be
accelerated and deemed to have vested as of the date of the “Change of
Control”.
6. Term
of Option.
To the
extent vested, and except as otherwise provided in this Agreement or the
Employment Agreement, the Option is exercisable for 10 years from the date
of
this Agreement; provided,
however,
that in
the event Optionee ceases to be an employee of the Company, for any reason
other
than for “Cause” (as defined in the Employment Agreement), Optionee or his/her
legal representative will have 2 years from the date of such termination
of his
employment to exercise any part of the Option vested pursuant to Sections
3, 4,
or 5 of this Agreement. In the event Optionee is terminated by the Company
for
“Cause” (as defined in the Employment Agreement), Optionee will have 90 days
from the date of such termination to exercise any part of the Option vested
pursuant to Sections 3, 4, or 5 of this Agreement. Upon the expiration of
such 2
year or 90 day period (as the case may be), or, if earlier, upon the expiration
date of the Option as set forth above, the Option will terminate and become
null
and void.
7. Rights
of Option Holder.
Optionee, as holder of the Option, shall not have any of the rights of a
shareholder with respect to the Shares covered by the Option except to the
extent that one or more certificates for such Shares shall be delivered to
him
or her upon the due exercise of all or any part of the Option.
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8. Transferability.
The
Option shall not be transferable except to the extent permitted by the
Plan.
9. Securities
Law Matters.
Optionee acknowledges that the Shares to be received by him or her upon exercise
of the Option may have not been registered under the Securities Act of 1933
or
the Blue Sky laws of any state (collectively, the “Securities
Acts”).
If
such Shares have not been so registered, Optionee acknowledges and understands
that the Company is under no obligation to register, under the Securities
Acts,
the Shares received by him or her or to assist him or her in complying with
any
exemption from such registration if he or she should at a later date wish
to
dispose of the Shares. Optionee acknowledges that if not then registered
under
the Securities Acts, the Shares shall bear a legend restricting the
transferability thereof, such legend to be substantially in the following
form:
“The
shares represented by this certificate have not been registered or qualified
under federal or state securities laws. The shares may not be offered for
sale,
sold, pledged or otherwise disposed of unless so registered or qualified,
unless
an exemption exists or unless such disposition is not subject to the federal
or
state securities laws, and the Company may require that the availability
or any
exemption or the inapplicability of such securities laws be established by
an
opinion of counsel, which opinion of counsel shall be reasonably satisfactory
to
the Company.”
10. Optionee
Representations.
Optionee hereby represents and warrants that Optionee has reviewed with his
or
her own tax advisors the federal, state, and local tax consequences of the
transactions contemplated by this Agreement. Optionee is relying solely on
such
advisors and not on any statements or representation of the Company or any
of
its agents. Optionee understands that he or she will be solely responsible
for
any tax liability that may result to him or her as a result of the transactions
contemplated by this Agreement. The Option, if exercised, will be exercised
for
investment and not with a view to the sale or distribution of the Shares
to be
received upon exercise thereof.
11. Notices.
All
notices and other communications provided in this Agreement will be in writing
and will be deemed to have been duly given when received by the party to
whom it
is directed at the following addresses (or to such other address as a party
provides in writing to the other party hereto):
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If
to the Company:
000
Xxxxxxxxx Xxxxx
Xxxxxxxxx,
XX 00000
Attn:
Chief Executive Officer
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If
to Optionee:
Xxxxxx
X. Xxxxxxxx
00
Xxxxxx Xxxxx
Xxxxxxx,
XX 00000
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12. General.
(a) The
Option is granted pursuant to the Plan and is governed by the terms thereof.
The
Company shall at all times during the term of the Option reserve and keep
available such number of Shares as will be sufficient to satisfy the
requirements of this Agreement.
(b) Nothing
herein expressed or implied is intended or shall be construed as conferring
upon
or giving to any person, firm, or corporation other than the parties hereto,
any
rights or benefits under or by reason of this Agreement.
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(c) Each
party hereto agrees to execute such further documents as may be necessary
or
desirable to effect the purposes of this Agreement.
(d) This
Agreement may be executed in any number of counterparts, each of which shall
be
deemed an original, but all of which shall constitute one and the same
agreement.
(e) This
Agreement, in its interpretation and effect, shall be governed by the laws
of
the Commonwealth of Pennsylvania applicable to contracts executed and to
be
performed therein.
IN
WITNESS WHEREOF, the undersigned have executed this Stock Option Agreement
as of
the date first written above.
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Number
of Shares:
280,000
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OPTIONEE: | ||
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Exercise
Price:
$
1.87/share
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| /s/ Xxxxxx X. Xxxxxxxx | |||
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Name:
Xxxxxx X. Xxxxxxxx
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| By: | /s/ Xxxxxxx X. Xxxx | |
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Name: Xxxxxxx X. Xxxx |
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Its:
CFO
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