EXHIBIT 10.6
FORM OF NONQULIFIED STOCK OPTION AGREEMENT UNDER
THE 2001 NONQUALIFIED STOCK PLAN
NONQUALIFIED STOCK OPTION
granted by
AWARE, INC.
(hereinafter called the "Company")
TO
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(hereinafter called the "Holder")
UNDER THE
2001 NONQUALIFIED STOCK PLAN
For valuable consideration, the receipt of which is hereby acknowledged,
the Company hereby grants to the Holder the following option:
FIRST: Subject to the terms and conditions hereinafter set forth, the
Holder is hereby given the right and option to purchase from the Company shares
of Common Stock, $.01 par value per share, of the Company ("Common Stock").
Schedule A hereto, the provisions of which are incorporated by reference herein,
sets forth (a) the maximum number of shares that the Holder may purchase upon
exercise of this Option, (b) the exercise price per share of Common Stock
purchasable hereunder, (c) the expiration date of this Option, (d) the vesting
rate and (e) certain other terms and conditions applicable to this Option.
This Option is and shall be subject in every respect to the provisions
of the Aware, Inc. 2001 Nonqualified Stock Plan, as the same may be amended from
time to time (the "Plan"). A copy of the Plan is available for review at the
offices of the Company and a copy of the Plan will be provided upon request to
each person granted an Option pursuant to the Plan. The Plan is hereby
incorporated herein by reference and made a part hereof. In the event of any
conflict or inconsistency between the terms of this Option and those of the
Plan, the terms of the Plan shall govern. The term "Committee" is used herein
with the meaning ascribed to it in the Plan.
This Option shall be exercised in whole or in part by the Holder's
delivery to the Company of written notice (the "Notice of Exercise") setting
forth the number of shares with respect to which this Option is to be exercised,
together with (a) cash in an amount, or certified check, bank check, postal or
express money order payable in an amount, or other instrument acceptable to the
Committee and payable in an amount, equal to the aggregate exercise price for
the shares being purchased, (b) with the consent of the Committee, shares of
Common Stock
having a Fair Market Value (as defined in the Plan) equal to such aggregate
exercise price, but only shares that have been owned by the Holder for a period
of at least six months and that are not then subject to restrictions; (c) with
the consent of the Committee, by the Holder delivering to the Company a properly
executed exercise notice together with irrevocable instructions to a broker to
promptly deliver to the Company cash or a check payable and acceptable to the
Company to pay such aggregate exercise price; PROVIDED THAT in the event the
Holder chooses to pay such aggregate exercise price as so provided, the Holder
and the broker shall comply with such procedures and enter into such agreements
of indemnity and other agreements as the Committee shall prescribe as a
condition of such payment procedure, and the Company need not act upon such
exercise notice until the Company receives full payment of such aggregate
exercise price; or (d) by any other means which the Committee determines are
consistent with the purpose of the Plan and with applicable laws and
regulations.
SECOND: The Company, in its discretion, may file a registration
statement on Form S-8 under the Securities Act of 1933, as amended, to register
shares of Common Stock reserved for issuance under the Plan. At any time at
which such a registration statement is not in effect, it shall be a condition
precedent to any exercise of this Option that the Holder shall deliver to the
Company a customary "investment letter" satisfactory to the Company and its
counsel in which, among other things, the Holder shall (a) state that he or she
is acquiring shares of Common Stock subject to the Option for his or her own
account for investment and not with a view to the resale or distribution thereof
and (b) acknowledge that those shares are not freely transferable except in
compliance with federal and state securities laws.
THIRD: As promptly as practicable after receipt by the Company of the
Notice of Exercise and related investment letter and payment of the exercise
price pursuant to Paragraphs First and Second hereof, the Company shall deliver
to the Holder (or if any other individual or individuals are exercising this
Option, to such individual or individuals) a certificate registered in the name
of the Holder (or the names of the other individual or individuals exercising
this Option) and representing the number of shares with respect to which this
Option is then being exercised; PROVIDED, HOWEVER, that if any law or regulation
or order of the Securities and Exchange Commission or any other body having
jurisdiction in the premises shall require the Company or the Holder (or the
individual or individuals exercising this Option) to take any action in
connection with the shares then being purchased, the date for the delivery of
the certificate for such shares shall be extended for the period necessary to
take and complete such action. The Company may imprint upon said certificate the
restrictive legends contemplated by Section 15(a) of the Plan or such other
legends as counsel for the Company may consider appropriate. Delivery by the
Company of the certificates for such shares shall be deemed effected for all
purposes when the Company or a stock transfer agent of the Company shall have
delivered such certificates in the United States mail, addressed to the Holder,
at the address specified in the Notice or, if none, at the last known address of
the Holder on file with the Company. The Company will pay all fees or expenses
necessarily incurred by the Company in connection with the issuance and delivery
of shares pursuant to the exercise of this Option.
The Company will, at all times while any portion of this Option is
outstanding, reserve and keep available, out of shares of its authorized and
unissued Common Stock or shares of Common Stock held in treasury, a sufficient
number of shares of its Common Stock to satisfy the requirements of this Option.
FOURTH: If the Company shall effect any subdivision or consolidation of
shares of its stock or other capital readjustment, the payment of a stock
dividend, or other increase or reduction of the number of shares outstanding, in
any such case without receiving compensation therefor in money, services or
property, then the number, class and per share price of shares of stock subject
to this Option shall be appropriately adjusted in such a manner as to entitle
the Holder to receive upon exercise of this Option, for the same aggregate cash
consideration, the same total number and class of shares as he or she would have
received as a result of the event requiring the adjustment had he or she
exercised this Option in full immediately prior to such event.
After a merger of one or more corporations into the Company, or after a
consolidation of the Company and one or more corporations in which (a) the
Company shall be the surviving corporation, and (b) the stockholders of the
Company immediately prior to such merger or consolidation own after such merger
or consolidation shares representing at least fifty percent of the voting power
of the Company, the Holder of this Option shall, at no additional cost, be
entitled upon exercise of this Option to receive in lieu of the number of shares
as to which this Option shall then be so exercisable, the number and class of
shares of stock or other securities to which the Holder would have been entitled
pursuant to the terms of the agreement of merger or consolidation if,
immediately prior to such merger or consolidation, the Holder had been the
holder of record of a number of shares of Common Stock equal to the number of
shares for which this Option was exercisable.
If the Company is merged into or consolidated with another corporation
under circumstances where the Company is not the surviving corporation, or if
there is a merger or consolidation where the Company is the surviving
corporation but the stockholders of the Company immediately prior to such merger
or consolidation do not own after such merger or consolidation shares
representing at least fifty percent of the voting power of the Company, or if
the Company is liquidated, or sells or otherwise disposes of substantially all
of its assets to another corporation (each hereinafter referred to as a
"Transaction") while this Option remains outstanding, then:
(a) subject to the provisions of clauses (b) and (c) below,
after the effective date of the Transaction, the Holder of this Option
shall be entitled, upon exercise hereof and at no additional cost, to
receive shares of Common Stock or, if applicable, shares of such other
stock or other securities, cash or property as the holders of shares of
Common Stock received pursuant to the terms of the Transaction;
(b) the Committee may accelerate the time for exercise of
this Option to a date prior to the effective date of the Transaction, as
specified by the Committee; or
(c) this Option may be canceled by the Committee as of the
effective date of the Transaction, PROVIDED that (i) notice of such
cancellation shall have been given to the Holder and (ii) the Holder
shall have the right to exercise this Option to the extent the same is
then exercisable or, if the Committee shall have accelerated the time
for exercise of this Option, in full during the thirty-day period
preceding the effective date of the Transaction.
Except as hereinbefore expressly provided, the issue by the Company of
shares of stock of any class, or securities convertible into shares of stock of
any class, for cash or property, or for labor or services, either upon direct
sale or upon the exercise of rights or warrants to subscribe therefor, or upon
conversion of shares or obligations of the Company convertible into such shares
or other securities, shall not affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of shares of Common Stock then
subject to this Option.
FIFTH: Neither the Holder nor any other person shall, by virtue of the
granting of this Option, be deemed for any purpose to be the owner of any shares
of Common Stock subject to this Option or to be entitled to the rights or
privileges of a holder of such shares unless and until this Option has been
exercised pursuant to the terms hereof with respect to such shares and the
Company has issued and delivered the shares to the Holder.
SIXTH: This Option is not transferable by the Holder or by operation of
law, otherwise than by will or under the laws of descent and distribution.
This Option is exercisable only by the Holder during the Holder's
lifetime and by the Holder only while he or she is providing services to the
Company, except that if the services of the Holder are terminated for any of the
following reasons, the Holder shall have the right to exercise this Option
within thirty days after the date of such termination of services (but not later
than the expiration date of this Option) with respect to the shares which were
purchasable by the Holder by exercise of this Option at the time of such
termination of services:
(i) Termination of services by the Holder;
(ii) Termination of services by the Company other than for Cause; or
(iii) Termination of services by Normal Retirement (as defined in the
Plan).
Notwithstanding the foregoing, in the event of the death of the Holder
prior to termination of the Holder's services to the Company and prior to the
date of expiration of this Option, the Holder's executors, administrators or any
individual or individuals to whom this Option is transferred by will or under
the laws of descent and distribution, as the case may be, shall have the right
to exercise this Option with respect to the number of shares purchasable by the
Holder at the date of death at any time within one year after the date of such
death (but not after the expiration date of this Option).
Notwithstanding the foregoing, in the event of the Disability (as
defined in the Plan) of the Holder prior to termination of the Holder's services
to the Company and prior to the date of expiration of this Option, the Holder
shall have the right to exercise this Option at any time within one year after
the date of such Disability (but not after the expiration date of this Option)
with respect to the number of shares which were purchasable by the Holder at the
date of such Disability.
If the Company terminates the services of the Holder for cause, the
Holder shall have the right to exercise this Option at any time before the
termination of services (but not after the expiration date of this Option) with
respect to the shares which were purchasable by the Holder by exercise of this
Option at the time of such exercise. As used in this Option, "Cause" shall
mean a determination by the Company that the Holder's services to the Company
should be terminated as a result of (i) a material breach by the Holder of any
agreement to which the Holder and the Company are both parties, (ii) any act
(other than Normal Retirement) or omission to act by the Holder that may have a
material and adverse effect on the Company's business or on the Holder's ability
to perform services for the Company, including, without limitation, the
commission of any crime (other than minor traffic violations), or (iii) any
material misconduct or material neglect of duties by the Holder in connection
with the business or affairs of the Company or any Subsidiary (as defined in the
Plan) or Affiliate (as defined in the Plan) of the Company.
SEVENTH: The Holder agrees that, upon the request of the Company or the
underwriters managing any underwritten offering of the Company's securities, the
Holder will not, for a period of time (not to exceed one hundred eighty (180)
days) following the effective date of any registration statement filed by the
Company under the Securities Act of 1933, as amended, sell, make any short sale
of, loan, grant any option for the purchase of, or otherwise dispose of any
shares of Common Stock received pursuant to this Option, without the prior
written consent of the Company or such underwriters, as the case may be, and
that the Holder will execute and deliver to the Company or such underwriters a
written agreement to that effect, in such form as the Company or such
underwriters shall designate.
EIGHTH: If the Company in its discretion determines that it is obligated
to withhold income or employment taxes required by any governmental authority
with respect to the exercise of this Option, the Holder agrees that the Company
may withhold from the Holder's wages, or other amounts due to the Holder from
the Company, the appropriate amount of federal, state or local withholding taxes
attributable to such exercise. The Holder may elect, with the consent of the
Committee, the amount required to be withheld may be satisfied, in whole or in
part, by (a) authorizing the Company to withhold from shares of Common Stock to
be issued pursuant to the exercise of this Option a number of shares with an
aggregate Fair Market Value (as of the date the withholding is effected) that
would satisfy the minimum withholding amount due with respect to such exercise,
or (b) transferring to the Company shares of Common Stock owned by the Holder
for a period of at least six (6) months and with an aggregate Fair Market Value
(as of the date the withholding is effected) that would satisfy the minimum
withholding amount due with respect to such exercise.
The Holder further agrees that, if the Company does not withhold an
amount from the Holder's wages sufficient to satisfy the Company's withholding
obligation, the Holder will reimburse the Company on demand, in cash, for the
amount underwithheld.
NINTH: Any notice to be given to the Company hereunder shall be deemed
sufficient if addressed to the Company and delivered at the office of the
President of the Company, or such other address as the Company may hereafter
designate, or when deposited in the mail, postage prepaid, addressed to the
attention of the President of the Company at such office or other address.
Any notice to be given to the Holder hereunder shall be deemed
sufficient if addressed to and delivered in person to the Holder at his address
furnished to the Company or when deposited in the mail, postage prepaid,
addressed to the Holder at such address.
TENTH: This Option is subject to all laws, regulations and orders of any
governmental authority which may be applicable thereto and, notwithstanding any
of the provisions hereof, the Holder agrees that he will not exercise the Option
granted hereby nor will the Company be obligated to issue any shares of stock
hereunder if the exercise thereof or the issuance of such shares, as the case
may be, would constitute a violation by the Holder or the Company of any such
law, regulation or order or any provision thereof.
IN WITNESS WHEREOF, the Company has caused this instrument to be
executed in its name and on its behalf as of the date of grant of this Option
set forth in Schedule A hereto.
AWARE, INC.
By:
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Xxxxxxx X. Xxxxxxx
Chief Executive Officer
AWARE, INC.
NONQUALIFIED STOCK OPTION
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SCHEDULE A
Name of Holder:
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Date of Grant:
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Maximum number of shares for which
this Option is exercisable:
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Exercise (purchase) price per share:
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Expiration date of this Option:
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Vesting rate:
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AWARE, INC.
Date: By:
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Xxxxxxx X. Xxxxxxx
Chief Executive Officer
The undersigned Holder acknowledges receipt of the Option of which this Schedule
A is a part and agrees to be bound by all obligations of the Holder as set forth
in such Option or in the Plan.
HOLDER
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