EXHIBIT 99.6
IT IS UNLAWFUL TO CONSUMMATE A SALE OR
TRANSFER OF THIS SECURITY, OR ANY INTEREST
THEREIN, OR TO RECEIVE ANY CONSIDERATION
THEREFOR, WITHOUT THE PRIOR WRITTEN CONSENT
OF THE COMMISSIONER OF CORPORATIONS OF THE
STATE OF CALIFORNIA, EXCEPT AS PERMITTED IN
THE COMMISSIONER'S RULES.
TERRAPIN TECHNOLOGIES, INC.
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STOCK OPTION AGREEMENT
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AGREEMENT made as of the ** day of **, 1991, by and between Terrapin
Technologies, Inc., a Delaware corporation (hereinafter called "Company"), and
** (hereinafter called "Optionee").
WITNESSETH:
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RECITALS
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A. The Board of Directors of the Company has adopted the Company's
1988 Stock Option Plan (the "Plan") for the purpose of attracting and retaining
the services of selected key employees (including officers and directors), non-
employee members of the Board of Directors, and consultants and independent
contractors who contribute to the financial success of the Company or its
subsidiary corporations. This Option is granted outside the Plan.
B. Optionee is an individual who is to render valuable services to
the Company or its subsidiary corporations.
C. The granted option is intended to be a non-qualified stock option
which does not satisfy the requirements of Section 422 of the Internal Revenue
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Code as amended (the "Code").
NOW, THEREFORE, it is hereby agreed as follows:
1. Grant of Option. Subject to and upon the terms and conditions
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set forth in this Agreement, there is hereby granted to Optionee, as of the date
of this Agreement (the "Grant Date"), a stock option to purchase up to ** (**)
shares of the Company's Common Stock (the "Optioned Shares") from time to time
during the option term at the option price of $** per share (the "Option
Price").
2. Option Term. This option shall have a maximum term of ten (10)
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years measured from the Grant Date and shall accordingly expire at the close of
business on, **, ** (the "Expiration Date"), unless sooner terminated in
accordance with Paragraph 5, or 7(a) of this Agreement.
3. Option Nontransferable; Exception. This option shall be
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transferable only by Optionee to an immediate member of Optionee's family, or
only by Optionee to a non-profit institution that currently employs the
Optionee. With the exceptions provided in the preceding sentence, this option
shall be neither transferable nor assignable by Optionee other than by will or
by the laws of descent and distribution. Unless this option is transferred
pursuant to the first sentence of this paragraph, this option may be exercised,
during Optionee's lifetime, only by Optionee.
4. Dates of Exercise. Optionee may, within the specified term of
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this option and pursuant to the provisions of this Agreement, purchase the
Optioned Shares in accordance with the following schedule:
(i) Twenty Percent (20%) of the Optioned Shares at any time
after the Grant Date.
(ii) The balance of the Optioned Shares in a series of sixty (60)
consecutive monthly installments, each equal to 1.3333 percent of the Optioned
Shares, with the first such installment to become exercisable one month from the
Grant Date, and each installment exercisable on the same day of each subsequent
month.
Within the limitations provided in this paragraph 4, Optionee may, on
any two occasions in each calendar year during the term of this option, purchase
any or all of the Optioned Shares for which this Option is at the time
exercisable.
5. Accelerated Termination of Option Term. The option term
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specified in Paragraph 2 shall terminate (and this option shall cease to be
exercisable) prior to the Expiration Date should one of the following provisions
become applicable:
(i) Except as otherwise provided in subparagraphs (ii), (iii) or
(iv) below, should Optionee cease to be a Service Provider at any time during
the option term, then the Optionee shall have up to a three (3) month period
commencing with the date of such cessation of Service Provider status, in which
to exercise this option for any or all of the Optioned Shares for which this
option is, in accordance with Paragraph 4, exercisable at the time of such
cessation of Service Provider status, but in no event shall this option be
exercisable at any time after the Expiration Date. Upon the expiration of such
three (3) month period or, if earlier, upon the Expiration Date, this option
shall terminate and cease to be outstanding.
(ii) Should Optionee die while this option is outstanding, then
the personal representative of the Optionee's estate or the person or persons to
whom the option is transferred pursuant to the Optionee's will or in accordance
with the law of descent and distribution or pursuant to this Stock Option
Agreement shall have the right to exercise this option provided and only if such
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exercise occurs prior to the earlier of (A) the expiration of the twelve (12)
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month period measured from the date of Optionee's death or (B) the Expiration
Date. During such period of limited exercisability, this option may be
exercised for any or all of the Optioned Shares for which this option is, in
accordance with Paragraph 4, exercisable at the time of the Optionee's cessation
of Service Provider status. Upon the expiration of such twelve (12)
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month period or, if earlier, upon the Expiration Date, this option shall
terminate and cease to be outstanding.
(iii) Should Optionee become permanently disabled, as defined in
Section 22(e)(3) of the Code, and cease by reason thereof to be a Service
Provider at any time during the option term, then the Optionee shall have a
period of twelve (12) months (commencing with the date of such cessation of
Service Provider status) in which to exercise this option for any or all of the
Optioned Shares for which this option is, in accordance with Paragraph 4,
exercisable at the time of such cessation of Service Provider status; provided,
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however, that in no event shall this option be exercisable at any time after the
Expiration Date. Upon the expiration of such limited period of exercisability
or, if earlier, upon the Expiration Date, this option shall terminate and cease
to be outstanding.
(iv) Should the Optionee's status as a Service Provider be
terminated for misconduct (including, but not limited to, any act of dishonesty,
willful misconduct, fraud or embezzlement or any unauthorized disclosure or use
of confidential information or trade secrets) or should the Optionee make or
attempt to make any unauthorized use or disclosure of the confidential
information or trade secrets of the Company or any subsidiary corporation, then
in any such event this option shall terminate and cease to be exercisable
immediately upon such termination of Service Provider status or such
unauthorized disclosure or use of confidential or secret information or attempt
or threat.
(v) For purposes of this Paragraph 5 and for all other purposes
under this Agreement, the Optionee shall be deemed to be a Service Provider for
so long as the Optionee continues to render periodic services as an employee of
the Company or any subsidiary corporation, a member of the Board of Directors of
the Company or any subsidiary corporation or as an independent contractor or
consultant to one or more of such entities. In applying the provisions of this
Agreement, a corporation shall be considered to be a subsidiary corporation of
the Company if it is a member of an unbroken chain of corporations beginning
with the Company, provided each such corporation in the chain (other than the
last corporation) owns, at the time of determination, stock possessing 50% or
more of the total combined voting power of all classes of stock in one of the
other corporations in such chain.
6. Change in Control of Company. Notwithstanding the terms of
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paragraph 5 hereof to the contrary, in the event the termination of Optionee's
status as a Service Provider is caused by the request of a funding source of the
Company, and is not for cause, then the option to purchase the Optioned Shares
shall be deemed immediately vested and shall be exercisable at any time prior to
the Expiration Date. This special provision shall be subject to the special
termination of option described in paragraph 8 of this Agreement.
7. Adjustment in Optioned Shares.
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(a) In the event any change is made to the Common Stock by reason of
any stock split, stock dividend, combination of shares, or other change
affecting the outstanding Common Stock as a class without receipt of
consideration, then appropriate adjustments will be made to (i) the total number
of Optioned Shares subject to this option, (ii) the number of Optioned Shares
for which this option may be exercised on each relevant date under Paragraph 4
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and (iii) the Option Price payable per share, in order to reflect such change
and thereby preclude a dilution or enlargement of benefits hereunder.
(b) If the Company is the surviving entity in any merger or other
business combination, then this option immediately after such merger or other
business combination, shall be appropriately adjusted to apply and pertain to
the number and class of securities which would be issuable to the Optionee in
the consummation of such merger or business combination if the option were
exercised immediately prior to such merger or business combination, and
appropriate adjustments shall also be made to the Option Price payable per
share, provided the aggregate Option Price payable hereunder shall remain the
same.
8. Special Termination of Option.
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(a) In the event of one or more of the following transactions (a
"Corporate Transaction"):
(i) A merger or acquisition in which the Company is not the
surviving entity, except for a transaction the principal purpose of which is to
change the State of the Company's incorporation,
(ii) The sale, transfer or other disposition of all or
substantially all of the assets of the Company or
(iii) Any reverse merger in which the Company is the surviving
entity but in which fifty percent (50%) or more of the Company's outstanding
voting stock is transferred to holders different from those who held the stock
immediately prior to such merger,
then to the extent permitted by applicable law, the exercisability of this
option shall automatically be accelerated so that such option shall, during the
five (5) business day period immediately prior to the specified effective date
for the Corporate Transaction, become fully exercisable with respect to the
Optioned Shares and may be exercised for all or any portion of such shares;
provided, however, that the exercisability of the accelerated option as an
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incentive stock option under the federal tax laws shall remain subject to the
applicable limitations. This option, to the extent not previously exercised,
shall terminate upon the consummation of such Corporate Transaction and cease to
be exercisable, unless it is expressly assumed by the successor corporation or
parent thereof.
(b) This Agreement shall not in any way affect the right of the
Company to adjust, reclassify, reorganize or otherwise make changes in its
capital or business structure or to merge, consolidate, dissolve, liquidate or
sell or transfer all or any part of its business or assets.
9. Privilege of Stock Ownership. The holder of this option shall
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not have any of the rights of a shareholder with respect to the Optioned Shares
until such individual shall have exercised the option and paid the Option Price.
10. Manner of Exercising Option.
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(a) In order to exercise this option with respect to all or any part
of the Optioned Shares for which this option is at the time exercisable,
Optionee (or in the case of exercise after Optionee's death, the Optionee's
executor, administrator, heir or legatee, as the case may be) must take the
following actions:
(i) Notify the Secretary of the Company,in accordance with
paragraph 15 of this Agreement of Optionee's desire to purchase Optioned Shares.
(ii) Pay the aggregate Option Price for the purchased shares in
one or more of the following alternative forms:
(A) full payment, in cash or cash equivalents; or
(B) full payment in shares of Common Stock of the Company
held by the Optionee for the requisite period necessary to avoid a charge to the
Company's reported earnings and valued at Fair Market Value on the Exercise Date
(as such terms are defined below) in an amount equal to the Option Price; or
(C) full payment in a combination of shares of Common Stock
of the Company held by the Optionee for the requisite period necessary to avoid
a charge to the Company's reported earnings and valued at Fair Market Value on
the Exercise Date and cash or cash equivalents, equal in the aggregate to the
Option Price; or
(D) any other form which the Board of Directors of the
Company may, in its discretion, approve at the time of exercise in accordance
with the provisions of paragraph 16 of this Agreement;
(iii) Furnish to the Company appropriate documentation that the
person or persons exercising the option, if other than Optionee, have the right
to exercise this option.
(iv) Execute whatever documents are reasonably deemed necessary
by the Board of Directors of the Company in order for the Company and the
Optionee to comply with the then current laws and regulations regarding the
issue of securities by the Company. Optionee must also execute the Stock
Purchase Agreement in the form attached to this Agreement.
(b) For purposes of Paragraph 10(a) above, the Fair Market Value of a
share of Common Stock shall be determined in accordance with subparagraphs (i)
through (iii) below, and the Exercise Date shall be the first date on which
there shall have been delivered to the Company both (I) the notice of Optionee's
desire to exercise and (II) the payment of the Option Price for the purchased
shares.
(i) If the Common Stock is not on the Exercise Date listed or
admitted to trading on any stock exchange, but is traded in the over-the-counter
market, the Fair Market Value shall be the mean between the highest bid and
lowest asked prices (or if such information is available, the closing selling
price) of one share of Common Stock on the Exercise Date in the over-the-counter
market, as such prices are reported by the National Association of Securities
Dealers through its NASDAQ system or any successor system. If there are no
reported bid and
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asked prices (or closing selling price) for the Common Stock on the Exercise
Date, than the mean between the highest bid and the lowest asked prices (or
closing selling price) on the last preceding date for which such quotations
exist shall be determinative of Fair Market Value.
(ii) If the Common Stock is on the Exercise Date listed or
admitted to trading on any stock exchange, then the Fair Market Value shall be
the closing selling price of one share of Common Stock on the Exercise Date on
the stock exchange determined by the Board of Directors of the Company to be the
primary market for the Common Stock, as such price is officially quoted in the
composite tape of transactions on such exchange. If there is no reported sale of
Common Stock on such exchange on the Exercise Date, then the Fair Market Value
shall be the closing selling price on the exchange on the last preceding ate for
which such quotation exists.
(iii) If the Common Stock is on the Exercise Date neither listed
or admitted to trading on any stock exchange nor traded in the over-the-counter
market, then the Fair Market Value shall be determined by the Board of Directors
of the Company after taking into account such factors as they shall deem
appropriate.
(c) This option shall be deemed to have been exercised with respect
to the number of Optioned Shares specified in the notice of Optionee's desire to
purchase Optioned Shares at such time as said notice shall have been received by
the Company. Payment of the Option Price shall immediately become due and shall
accompany the notice. As soon thereafter as practical, the Company shall mail or
deliver to Optionee or to the other person or persons exercising this option a
certificate or certificates representing the shares so purchased and paid for,
with the appropriate legends affixed thereto.
(d) In no event may this option be exercised for less than one
hundred shares or any fractional shares.
11. Compliance with Laws and Regulations.
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(a) The exercise of this option and the issuance of Optioned Shares
upon such exercise shall be subject to compliance by the Company and the
Optionee with all applicable requirements of law relating thereto and with all
applicable regulations of any stock exchange on which shares of the Company's
Common Stock may be listed at the time of such exercise and issuance.
(b) In connection with the exercise of this option, Optionee shall
execute and deliver to the Company such representations in writing as may be
requested by the Company in order for it to comply with the applicable
requirements of federal and state securities laws.
(c) Optionee understands that, when issued, with regard to the
purchased shares:
(i) Exemption from Registration. The purchased shares will not
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have been registered under the Securities Act of 1933, as amended (the "1933
Act") and will be issued to Optionee in reliance upon the exemption from such
registration provided by Rule 701
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of the Securities and Exchange Commission for stock issuances under compensatory
benefit plans.
(ii) Restricted Securities. Optionee will confirm that Optionee
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has been informed that the purchased shares are restricted securities under the
1933 Act and may not be resold or transferred unless the purchased shares are
first registered under the Federal securities laws or unless an exemption from
such registration is available. Accordingly, Optionee will acknowledge that
Optionee is prepared to hold the purchased shares for an indefinite period and
that Optionee is aware that Rule 144 of the Securities and Exchange Commission
issued under the 1933 Act is not presently available to exempt the sale of the
purchased shares from the registration requirements of the 1933 Act. Upon the
expiration of the ninety (90)-day period immediately following the date on which
the Corporation first becomes subject to the reporting requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), the purchased
shares may be sold (without registration) pursuant to the applicable
requirements of Rule 144. If Optionee is at the time of such sale an affiliate
of the Corporation for purposes of Rule 144 or was an affiliate during the
preceding three (3) months, then the sale must comply with all the requirements
of Rule 144 (including the volume limitation on the number of shares sold, the
broker/market maker sale requirement and the requisite notice to the Securities
and Exchange Commission); however, the two-year holding period requirement of
the Rule will not be applicable. If Optionee is not at the time of the sale an
affiliate of the Corporation nor was Optionee an affiliate during the preceding
three (3) months, then none of the requirements of Rule 144 (other than the
broker/market maker sale requirement for purchased shares held for less than
three (3) years following payment in cash of the Option Price therefor) will be
applicable to the sale. Should the Corporation not become subject to the
reporting requirements of the Exchange Act, then Optionee may, provided he/she
is neither at the time an affiliate of the Corporation nor was an affiliate
during the preceding three (3) months, sell the purchased shares (without
registration) pursuant to paragraph (k) of Rule 144 after the purchased shares
have been held for a period of three (3) years following the payment in cash of
the Option Price for such shares.
(d) Restrictive Legends. In order to reflect the restrictions on
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disposition of the purchased shares, the stock certificates for the purchased
shares will be endorsed with restrictive legends, including the following
legend:
"The shares represented by this certificate have not been registered
under the Securities Act of 1933. The shares may not be sold or
offered for sale in the absence of (a) an effective registration
statement for the shares under such Act, (b) a "no action" letter of
the Securities and Exchange Commission with respect to such sale or
offer, or (c) satisfactory assurances to the Company that registration
under such Act is not required with respect to such sale or offer."
(e) Receipt of Commissioner Rules. Optionee will receive a copy of
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Section 260.141.11 of the Rules of the California Corporations Commissioner
upon the grant of this option, a copy of which is attached to this Agreement.
12. Successors and Assigns. Except to the extent otherwise provided
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in Paragraph 3, the provisions of this Agreement shall inure to the benefit
of, and be binding upon,
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the successors, administrators, heirs, legal representatives and assigns of
Optionee and the successors and assigns of the Company.
13. Liability of Company. The inability of the Company to obtain
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approval from any regulatory body having authority deemed by the Company to be
necessary to the lawful issuance and sale of any Common Stock pursuant to this
option shall relieve the Company of any liability with respect to the non-
issuance or sale of the Common Stock as to which such approval shall not have
been obtained. The Company, however, shall use its best efforts to obtain all
such approvals.
14. No Employment or Service Contract. Nothing in this Agreement
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shall confer upon the Optionee any right to continue in the service of the
Company (or any subsidiary corporation of the Company employing or retaining
Optionee) for any period of time or interfere with or restrict in any way the
rights of the Company (or any subsidiary corporation of the Company employing
or retaining Optionee) or the Optionee, which rights are hereby expressly
reserved by each, to terminate the Service Provider status of Optionee at any
time for any reason whatsoever, with or without cause.
15. Notices. Any notice required to be given or delivered to the
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Company under the terms of this Agreement shall be in writing and addressed to
the Company in care of the Company's President, with a copy to the Company's
Secretary, at its corporate offices. Any notice required to be given or
delivered to Optionee shall be in writing and addressed to Optionee at the
address indicated below Optionee's signature line on this Agreement. All
notices shall be deemed to have been given or delivered upon personal delivery
or upon deposit in the U.S. Mail, postage prepaid and properly addressed to
the party to be notified.
16. Withholding. Optionee hereby agrees to make appropriate
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arrangements with the Company or subsidiary corporation employing Optionee (if
any) for the satisfaction of any federal, state or local income tax
withholding requirements and federal social security employee tax requirements
applicable to the exercise of this option.
17. Construction. All decisions of the Board of Directors of the
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Company with respect to any question or issue arising under this Agreement
shall be conclusive and binding upon all persons having an interest in this
option.
18. Governing Law. The interpretation, performance, and enforcement
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of this Agreement shall be governed by the laws of the State of California.
19. Counterparts. This Agreement may be executed in counterparts,
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each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed on its behalf by its duly authorized officer and Optionee has also
executed this Agreement, all as of the day and year indicated above.
Terrapin Technologies, Inc.
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By:____________________________
Title:_________________________
Optionee:______________________
Signature
Address:_______________________
_______________________
Tax I.D._______________________
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