NON-QUALIFIED STOCK OPTION AGREEMENT PURSUANT TO 2006 EQUITY INCENTIVE PLAN
EXHIBIT 10.27
WIRELESS RONIN TECHNOLOGIES, INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
PURSUANT TO 2006 EQUITY INCENTIVE PLAN
PURSUANT TO 2006 EQUITY INCENTIVE PLAN
| No. of shares subject to option: ______ | Option No.: ___ | |
| Date of grant: ______ |
THIS OPTION AGREEMENT is entered into by and between Wireless Ronin Technologies, Inc., a
Minnesota corporation (the “Company”), and )
_________ (the “Optionee”) pursuant to the
Company’s 2006 Equity Incentive Plan, as amended to date (the “Plan”). Unless otherwise defined
herein, certain capitalized terms shall have the meaning set forth in the Plan.
W I T N E S S E T H:
1. Nature of the Option. This Option is not intended to qualify as an Incentive Stock
Option within the meaning of Xxxxxxx 000 xx xxx Xxxxxx Xxxxxx Internal Revenue Code of 1986, as
amended.
2. Grant of Option. Pursuant to the provisions of the Plan, the Company grants to the
Optionee, subject to the terms and conditions of the Plan and to the terms and conditions herein,
the right and option to purchase from the Company all or a part of an aggregate of
_________ shares of the Company’s Common Stock (the “Shares”) at the purchase price per
share equal to the price per share at which the Company’s Common Stock is sold to the public in an
initial public offering scheduled to take place in 2006, such Option to be exercised as hereinafter
provided.
3. Terms and Conditions. The Option is subject to the following terms and conditions:
(a) Expiration Date. This Option shall expire ten years after the date of grant
specified above.
(b) Exercise of Option. Subject to the Plan and the other terms of this Agreement
regarding the exercisability of this Option, this Option shall be exercisable cumulatively, to the
extent it is vested, as follows: (i)
______Shares as of the date of grant; (ii) V______
Shares on ______, 20___; (iii) ______Shares
on ______, 20___; and (iv) ______Shares on
______, 20___. Any exercise shall be accompanied by a written notice to the Company specifying the
number of shares of Stock as to which the Option is being exercised. Notation of any partial
exercise shall be made by the Company on Schedule I hereto. This Option may not be exercised for a
fraction of a Share, and must be exercised for no fewer than one hundred (100) shares of Stock, or
such lesser number of shares as may be vested.
(c) Payment of Purchase Price Upon Exercise. At the time of any exercise, the
Exercise Price of the Shares as to which this Option is exercised shall be paid in cash to the
Company, unless the Board shall permit or require payment of the purchase price in another
manner set forth in the Plan.
(d) Subject to Shareholder Approval. This Option shall not be effective or
exercisable unless and until the Plan is approved by action of the shareholders of the Company not
later than March 29, 2007. If the Plan is not so approved, this Option shall be null and void.
(e) Acceleration of Option Upon Change in Control. In the event of a Change in
Control the provisions of Section 3(b) hereof pertaining to vesting shall cease to apply and this
Option shall become immediately vested and fully exercisable with respect to all Shares; provided,
however, that unless otherwise provided by the Committee, the provisions of this Subsection 3(e)
shall not apply unless the Optionee has been employed by the Company for a period of at least one
year. No acceleration of vesting shall occur under this Subsection 3(e) in the event a surviving
corporation or its parent assumes this Option or in the event the surviving corporation or its
parent substitutes an option agreement with substantially the same economic terms as provided in
this Agreement. Nothing in this Subsection 3(e) shall limit the Committee’s authority to cancel
this Option in accordance with Section 6 hereof. Notwithstanding the provisions of this Section
3(e), in the event of a Change in Control of the Company, the committee, in its sole discretion
may, without the consent of Optionee, determine that Optionee will receive, with respect to some or
all of the shares of Common Stock subject to this Option, as of the effective date of any Change in
Control of the Company, cash in an amount equal to the excess of the Fair Market Value of such
Shares immediately prior to the effective date of such Change in Control of the Company over the
exercise price per share of such options and that with respect to any granted and outstanding
Option, the Fair Market Value of which is less than or equal to the exercise price per share of
such Option as of the effective date of such Change in Control and that the Option therefor shall
terminate as of the effective date of the Change in Control. If the committee makes such
determination, then as of the effective date of any such Change in Control of the Company, such
Options will terminate as to such shares and Optionee will only have the right to receive such cash
payment. If the committee makes such determination, the Option will terminate, become void and
expire as to all unexercised shares of Common Stock subject to such Option on such date and
Optionee will have no further rights with respect to the Option.
(f) Subject to Lock Up. Optionee understands that the Company at a future date may
file a registration or offering statement (the “Registration Statement”) with the Securities and
Exchange Commission to facilitate an underwritten public offering of its securities. The Optionee
agrees, for the benefit of the Company, that should such an underwritten public offering be made
and should the managing underwriter of such offering require, the undersigned will not, without the
prior written consent of the Company and such underwriter, during the Lock Up Period as defined
herein: sell, transfer or otherwise dispose of, or agree to sell, transfer or otherwise dispose of
this Option or any of the Shares acquired upon exercise of this Option during the Lock Up Period;
or sell or grant, or agree to sell or grant, options, rights or warrants with respect to any of the
Shares acquired upon exercise of this Option. The foregoing does not prohibit gifts to donees or
transfers by will or the laws of descent to heirs or beneficiaries provided that such donees, heirs
and beneficiaries shall be bound by the restrictions set forth herein. The term “Lock Up Period”
shall mean the period (not to exceed 12 months) during which Company officers and directors are
restricted by the managing underwriter from effecting
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any sales or transfers of the Shares. The Lock Up Period shall commence on the effective date
of the Registration Statement.
(g) Not An Employment Contract. The Option will not confer on the Optionee any right
with respect to continuance of employment or other service with the Company or any Subsidiary, nor
will it interfere in any way with any right the Company or any Subsidiary would otherwise have to
terminate or modify the terms of such Optionee’s employment or other service at any time.
(h) No Rights as Shareholder. The Optionee shall have no rights as a shareholder of
the Company with respect to any Shares prior to the date of issuance to the Optionee of a
certificate for such Shares.
(i) Compliance with Law and Regulations. This Option and the obligation of the
Company to sell and deliver Shares hereunder shall be subject to all applicable laws, rules and
regulations (including, but not limited to, federal securities laws) and to such approvals by any
government or regulatory agency as may be required. This Option shall not be exercisable, and the
Company shall not be required to issue or deliver any certificates for Shares of Stock prior to the
completion of any registration or qualification of such Shares under any federal or state law, or
any rule or regulation of any government body which the Company shall, in its sole discretion,
determine to be necessary or advisable. Moreover, this Option may not be exercised if its exercise
or the receipt of Shares of Stock pursuant thereto would be contrary to applicable law.
(j) Withholding. All deliveries and distributions under this Agreement are subject to
withholding of all applicable taxes. At the election of the Optionee, and subject to such rules
and limitations as may be established by the Committee from time to time, such withholding
obligations may be satisfied through the surrender of shares of Stock which the Optionee already
owns, or to which the Optionee is otherwise entitled under the Plan.
(k) Nontransferability. This Option shall not be transferable other than by will or
by the laws of descent and distribution. During the lifetime of the Optionee, this Option shall be
exercisable only by the Optionee or by the Optionee’s guardian or legal representative. No
transfer of this Option by the Optionee by will or by the laws of descent and distribution shall be
effective to bind the Company unless the Company is furnished with written notice thereof and a
copy of the will and/or such other evidence as the Board may determine necessary to establish the
validity of the transfer.
4. Termination of Employment. Upon the termination of the employment of Optionee
prior to the expiration of the Option, the following provisions shall apply:
(a) Upon the Involuntary Termination of Optionee’s employment or the voluntary termination or
resignation of Optionee’s employment, the Optionee may exercise the Option to the extent the
Optionee was vested in and entitled to exercise the Option at the date of such employment
termination for a period of three (3) months after the date of such employment termination, or
until the term of the Option has expired, whichever date occurs first. To the extent the Optionee
was not entitled to exercise this Option at the date of such employment
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termination, or if Optionee does not exercise this Option within the time specified herein,
this Option shall terminate.
(b) If the employment of an Optionee is terminated by the Company for cause, then the Board or
the Committee shall have the right to cancel the Option.
5. Death, Disability or Retirement of Optionee. Upon the death, Disability or
Retirement, as defined herein, of Optionee prior to the expiration of the Option, the following
provisions shall apply:
(a) If the Optionee is at the time of his Disability employed by the Company or a Subsidiary
and has been in continuous employment (as determined by the Committee in its sole discretion) since
the Date of Grant of the Option, then the Option may be exercised by the Optionee for one (1) year
following the date of such Disability or until the expiration date of the Option, whichever date is
earlier, but only to the extent the Optionee was vested in and entitled to exercise the Option at
the time of his Disability. For purposes of this Section 5, the term “Disability” shall mean that
the Optionee is unable, by reason of a medically determinable physical or mental impairment, to
substantially perform the principal duties of employment with the Company, which condition, in the
opinion of a physician selected by the Board, is expected to have a duration of not less than 120
days, unless the Optionee is employed by the Company, a Parent, a Subsidiary or an Affiliate,
pursuant to an employment agreement which contains a definition of “Disability,” in which case such
definition shall control. The Committee, in its sole discretion, shall determine whether an
Optionee has a Disability and the date of such Disability.
(b) If the Optionee is at the time of his death employed by the Company or a Subsidiary and
has been in continuous employment (as determined by the Committee in its sole discretion) since the
Date of Grant of the Option, then the Option may be exercised by the Optionee’s estate or by a
person who acquired the right to exercise the Option by will or the laws of descent and
distribution, for one (1) year following the date of the Optionee’s death or until the expiration
date of the Option, whichever date is earlier, but only to the extent the Optionee was vested in
and entitled to exercise the Option at the time of death.
(c) If the Optionee is at the time of his Retirement employed by the Company or a Subsidiary
and has been in continuous employment (as determined by the Committee in its sole discretion) since
the Date of Grant of the Option, then the Option may be exercised by the Optionee for one (1) year
following the date of the Optionee’s Retirement or until the expiration date of the Option,
whichever date is earlier, but only to the extent the Optionee was vested in and entitled to
exercise the Option at the time of Retirement. For purposes of this Section 5, “Retirement” means
Optionee’s voluntary termination of employment or termination by the Company without cause on or
after the date the Optionee attains age 60.
(d) If the Optionee dies within three (3) months after Termination of Optionee’s employment
with the Company or a Subsidiary the Option may be exercised for nine (9) months following the date
of Optionee’s death or the expiration date of the Option, whichever date is earlier, by the
Optionee’s estate or by a person who acquires the right to exercise the Option by will or the laws
of descent or distribution, but only to the extent the Optionee was vested in and entitled to
exercise the Option at the time of Termination.
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6. Termination of Relationship for Misconduct; Clawback. If the Board or the
Committee reasonably believes that the Optionee has committed an act of misconduct, it may suspend
the Optionee’s right to exercise this option pending a determination by the Board or the Committee.
If the Board or the Committee determines that the Optionee has committed an act of misconduct or
has breached a duty to the Company, neither the Optionee nor the Optionee’s estate shall be
entitled to exercise the Option. For purposes of this Section 6, an act of misconduct shall
include embezzlement, fraud, dishonesty, nonpayment of an obligation owed to the Company, breach of
fiduciary duty or deliberate disregard of the Company’s rules resulting in loss, damage or injury
to the Company, or if the Optionee makes an unauthorized disclosure of any Company trade secret or
confidential information, engages in any conduct constituting unfair competition with respect to
the Company, or induces any party to breach a contract with the Company. An act of misconduct or
breach of fiduciary duty to the Company shall include an event giving the Company the right to
terminate Optionee’s employment for cause pursuant to any employment agreement between Optionee and
the Company. In addition, misconduct shall include willful violations of federal or state
securities laws. In making such determination, the Board or the Committee shall act fairly and
shall give the Optionee an opportunity to appear and present evidence on the Optionee’s behalf at a
hearing before the Board or the Committee. In addition, if the Company, based upon an opinion of
legal counsel or a judicial determination, determines that Section 304 of the Xxxxxxxx-Xxxxx Act of
2002 is applicable to Optionee hereunder, to the extent that the Company is required to prepare an
accounting restatement due to the material noncompliance of the Company, as a result of misconduct,
with any financial reporting requirement under the securities laws, Optionee shall reimburse the
Company for any compensation received by Optionee from the Company during the 12-month period
following the first public issuance or filing with the Securities and Exchange Commission
(whichever first occurs) of the financial document embodying such financial reporting requirement
and any profits received from the sale of the Company’s common stock or common stock equivalents,
acquired pursuant to this Agreement.
7. Heirs and Successors. This Agreement shall be binding upon, and inure to the
benefit of, the Company and its successors and assigns, and upon any person acquiring, whether by
merger, consolidation, purchase of assets or otherwise, all or substantially all of the Company’s
assets and business. If any rights exercisable by the Optionee or benefits deliverable to the
Optionee under this Agreement have not been exercised or delivered, respectively, at the time of
the Optionee’s death, such rights shall be exercisable by the Designated Beneficiary, and such
benefits shall be delivered to the Designated Beneficiary, in accordance with the provisions of
this agreement and the Plan. The “Designated Beneficiary” shall be the beneficiary or
beneficiaries designated by the Optionee in a writing filed with the Committee in such form and at
such time as the Committee shall require. If a deceased Optionee fails to designate a beneficiary,
or if the Designated Beneficiary does not survive the Optionee, any rights that would have been
exercisable by the Optionee and any benefits distributable to the Optionee shall be exercised by or
distributed to the legal representative of the estate of the Optionee. If a deceased Optionee
designates a beneficiary and the Designated Beneficiary survives the Optionee but dies before the
Designated Beneficiary’s exercise of all rights under this Agreement or before the complete
distribution of benefits to the Designated Beneficiary under this Agreement, then any rights that
would have been exercisable by the Designated Beneficiary shall be exercised by the legal
representative of the estate of the Designated Beneficiary, and any benefits distributable to
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the Designated Beneficiary shall be distributed to the legal representative of the estate of
the Designated Beneficiary.
8. Plan Governs. Notwithstanding anything in this Agreement to the contrary, the
terms of this Agreement shall be subject to the terms of the Plan, a copy of which may be obtained
by the Optionee from the Company; and this Agreement is subject to all interpretations, amendments,
rules and regulations promulgated by the Committee from time to time pursuant to the Plan. The
Optionee hereby acknowledges receipt of a copy of the Plan and agrees to be bound by all the terms
and provisions thereof. In the event of any question or inconsistency between this Agreement and
the Plan, the terms and conditions of the Plan shall govern.
9. Notices. Any notice hereunder to the Company shall be addressed to it at its
principal executive offices, located at 00000 Xxxxxx Xxxxx, Xxxx Xxxxxxx, XX 00000, Attention:
Chief Financial Officer; and any notice hereunder to the Optionee shall be addressed to the
Optionee at the address last appearing in the employment records of the Company; subject to the
right of either party to designate at any time hereunder in writing some other address.
10. Counterparts. This Agreement may be executed in two counterparts each of which
shall constitute one and the same instrument.
11. Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Minnesota, except to the extent preempted by federal law, without
regard to the principles of comity or the conflicts of law provisions of any other jurisdiction.
IN WITNESS WHEREOF, the Company and Optionee have executed this Agreement, both as of the day
and year first above written.
| WIRELESS RONIN TECHNOLOGIES, INC. |
||||
| By: | ||||
| Its: | ||||
| OPTIONEE |
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SCHEDULE I — NOTATIONS AS TO PARTIAL EXERCISE
| Number of Purchased |
Balance of Shares |
Authorized | ||||||||
| Date of Exercise | Shares | on Option | Signature | Notation Date | ||||||
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