AUTOCHINA INTERNATIONAL LIMITED SHARE OPTION AWARD AGREEMENT
Award
Number: «Award_No_1»
AUTOCHINA INTERNATIONAL
LIMITED
2009
EQUITY INCENTIVE PLAN
1. Grant of
Option. AutoChina International Limited, a company
incorporated under the laws of the Cayman Islands, (the “Company”) hereby grants
to the Grantee (the “Grantee”) named in the Notice of Share Option Award (the
“Notice”), an option (the “Option”) to purchase the Total Number of Ordinary
Shares subject to the Option (the “Shares”) set forth in the Notice, at the
Exercise Price per Share set forth in the Notice (the “Exercise Price”) subject
to the terms and provisions of the Notice, this Share Option Award Agreement
(the “Option Agreement”) and the Company’s 2009 Equity Incentive Plan, as
amended from time to time (the “Plan”), which are incorporated herein by
reference. Unless otherwise defined herein, the terms defined in the
Plan shall have the same defined meanings in this Option Agreement.
If
designated in the Notice as an Incentive Stock Option, the Option is intended to
qualify as an Incentive Stock Option as defined in Section 422 of the
Code. However, notwithstanding such designation, the Option will
qualify as an Incentive Stock Option under the Code only to the extent the
US$100,000 dollar limitation of Section 422(d) of the Code is not
exceeded. The US$100,000 limitation of Section 422(d) of the
Code is calculated based on the aggregate Fair Market Value of the Shares
subject to options designated as Incentive Stock Options which become
exercisable for the first time by the Grantee during any calendar year (under
all plans of the Company or any Parent or Subsidiary of the
Company). For purposes of this calculation, Incentive Stock Options
shall be taken into account in the order in which they were granted, and the
Fair Market Value of the shares subject to such options shall be determined as
of the grant date of the relevant option.
2. Exercise of
Option.
(a) Right to
Exercise. The Option shall be exercisable during its term in
accordance with the Vesting Schedule set out in the Notice and with the
applicable provisions of the Plan and this Option Agreement. The
Option shall be subject to the provisions of Section 11 of the Plan
relating to the exercisability or termination of the Option in the event of a
Corporate Transaction. Notwithstanding the provisions of Section
11(b), vesting will accelerate and the Option shall become fully vested and
immediately exercisable upon the occurrence of a Change in Control as such term
is defined in Section 2(i) of the Plan. The Grantee (including any Holding
Company of such Grantee) shall be subject to reasonable limitations on the
number of requested exercises during any monthly or weekly period as determined
by the Administrator. In no event shall the Company issue fractional
Shares.
(b) Method of
Exercise. The Option shall be exercisable by delivery of an
exercise notice (a form of which is attached as Exhibit A) or by such other
procedure as specified from time to time by the Administrator which shall state
the election to exercise the Option, the whole number of Shares in respect of
which the Option is being exercised, and such other provisions as may be
required by the Administrator. The exercise notice shall be delivered
in person, by certified mail, or by such other method (including electronic
transmission) as determined from time to time by the Administrator to the
Company accompanied by payment of the Exercise Price. The Option
shall be deemed to be exercised upon receipt by the Company of such notice
accompanied by the Exercise Price, which, to the extent selected, shall be
deemed to be satisfied by use of the sale and remittance procedure to pay the
Exercise Price provided in Section 4(d) below.
(c) Taxes. No
Shares will be delivered to the Grantee (including any Holding Company of such
Grantee) or other person pursuant to the exercise of the Option until the
Grantee (including any Holding Company of such Grantee) or other person has made
arrangements acceptable to the Administrator for the satisfaction of applicable
income tax and employment tax withholding obligations, including, without
limitation, such other tax obligations of the Grantee (including any Holding
Company of such Grantee) incident to the receipt of Shares. Upon
exercise of the Option, the Company or the Grantee’s employer may offset or
withhold (from any amount owed by the Company or the Grantee’s employer to the
Grantee) or collect from the Grantee or other person an amount sufficient to
satisfy such tax withholding obligations.
3. Xxxxxxx’s
Representations. The Grantee understands that neither the
Option nor the Shares exercisable pursuant to the Option have been registered
under any United States or non-U.S. securities laws. In the event the
Shares purchasable pursuant to the exercise of the Option have not been
registered under the Securities Act of 1933, as amended, at the time the Option
is exercised, the Grantee shall, if requested by the Company, concurrently with
the exercise of all or any portion of the Option, deliver to the Company his or
her Investment Representation Statement in the form attached hereto as Exhibit
B.
4. Method of
Payment. Payment of the Exercise Price shall be made by any of
the following, or a combination thereof, at the election of the Grantee;
provided, however, that such exercise method does not then violate any
Applicable Law:
(a) cash;
(b) check;
(c) surrender
of Shares or delivery of a properly executed form of attestation of ownership of
Shares as the Administrator may require which have a Fair Market Value on the
date of surrender or attestation equal to the aggregate Exercise Price of the
Shares as to which the Option is being exercised;
(d) payment
through a broker-dealer sale and remittance procedure pursuant to which the
Grantee (i) shall provide written instructions to a Company-designated brokerage
firm to effect the immediate sale of some or all of the purchased Shares and
remit to the Company sufficient funds to cover the aggregate exercise price
payable for the purchased Shares and (ii) shall provide written directives to
the Company to deliver the certificates for the purchased Shares directly to
such brokerage firm in order to complete the sale transaction;
(e) payment
through a “net exercise” such that, without the payment of any funds, the
Grantee may exercise the Option and receive the net number of Shares equal to
(i) the number of Shares as to which the Option is being exercised, multiplied
by (ii) a fraction, the numerator of which is the Fair Market Value per Share
(on such date as is determined by the Administrator) less the Exercise Price per
Share, and the denominator of which is such Fair Market Value per Share (the
number of net Shares to be received shall be rounded down to the nearest whole
number of Shares); or
(f) any
combination of the foregoing methods of payment.
5. Restrictions on
Exercise. The Option may not be exercised if the issuance of
the Shares subject to the Option upon such exercise would
constitute a violation of any Applicable Laws. In addition, the
Option may not be exercised until such time as the Plan has been approved by the
shareholders of the Company. If the exercise of the Option within the
applicable time periods set forth in Sections 6, 7 and 8 of this Option
Agreement is prevented by the provisions of this Section 4(f), the Option
shall remain exercisable until one (1) month after the date the Grantee is
notified by the Company that the Option is exercisable, but in any event no
later than the Expiration Date set forth in the Notice.
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6. Termination or Change of
Continuous Service. In the event the Grantee’s Continuous
Service terminates, other than for Cause, the Grantee (or the
Holding Company of such Grantee, as applicable) may, but only during the
Post-Termination Exercise Period, exercise the portion of the Option that was
vested at the date of such termination (the “Termination Date”). The
Post-Termination Exercise Period shall commence on the Termination
Date. In the event of termination of the Grantee’s Continuous Service
for Cause, the right of the Grantee (or the Holding Company of such Grantee, as
applicable) to exercise the Option shall, except as otherwise determined by the
Administrator, terminate concurrently with the termination of the Grantee’s
Continuous Service (also the “Termination Date”). In no event,
however, shall the Option be exercised later than the Expiration Date set forth
in the Notice. In the event of the Grantee’s change in status from
Employee, Director or Consultant to any other status of Employee, Director or
Consultant, the Option shall remain in effect and the Option shall continue to
vest in accordance with the Vesting Schedule set forth in the Notice only if
such change is determined by the Administrator, in its complete and sole
discretion, to constitute a lateral change or a promotion and not a demotion in
the employment status of the Grantee. However, with
respect to any Incentive Stock Option that shall remain in effect after a change
in status from Employee to Director or Consultant, such Incentive Stock Option
shall cease to be treated as an Incentive Stock Option and shall be treated as a
Non-Qualified Stock Option on the day three (3) months and one (1) day
following such change in status. Except as provided in
Sections 7 and 8 below, to the extent that the Option was unvested on
the Termination Date, or if the Grantee (or the Holding Company of such Grantee,
as applicable) does not exercise the vested portion of the Option within the
Post-Termination Exercise Period, the Option shall
terminate.
7. Disability of
Grantee. In the event the Grantee’s Continuous Service
terminates as a result of his or her Disability, the Grantee (or the Holding
Company of such Grantee, as applicable) may, but only within three (3) months
commencing on the Termination Date (but in no event later than the Expiration
Date), exercise the portion of the Option that was vested on the Termination
Date; provided, however, that if such Disability is not a “disability” as such
term is defined in Section 22(e)(3) of the Code and the Option is an
Incentive Stock Option, such Incentive Stock Option shall cease to be treated as
an Incentive Stock Option and shall be treated as a Non-Qualified Stock Option
on the day three (3) months and one (1) day following the Termination
Date. To the extent that the Option was unvested on the Termination
Date, or if the Grantee does not exercise the vested portion of the Option
within the time specified herein, the Option shall
terminate. Section 22(e)(3) of the Code provides that an
individual is permanently and totally disabled if he or she is unable to engage
in any substantial gainful activity by reason of any medically determinable
physical or mental impairment which can be expected to result in death or which
has lasted or can be expected to last for a continuous period of not less than
twelve (12) months.
8. Death of
Grantee. In the event of the termination of the Grantee’s
Continuous Service as a result of his or her death, or in the event of the
Grantee’s death during the Post-Termination Exercise Period or during the three
(3) month period following the Grantee’s termination of Continuous Service as a
result of his or her Disability, the person who acquired the right to exercise
the Option pursuant to Section 9 may exercise the portion of the Option
that was vested at the date of termination within three (3) months commencing on
the date of death (but in no event later than the Expiration
Date). To the extent that the Option was unvested on the date of
death, or if the vested portion of the Option is not exercised within the time
specified herein, the Option shall terminate.
9. Transferability of
Option. Incentive Stock Options may not be sold, pledged,
assigned, hypothecated, transferred, or disposed of in any manner other than by
will or by the laws of descent or distribution and may be exercised, during the
lifetime of the Grantee, only by the Grantee. The Option, if a
Non-Qualified Stock Option, may be transferable (i) by will and by the laws
of descent and distribution and (ii) during the lifetime of the Grantee:
(A) to a Holding Company of such Grantee, or (B) to the extent and in the manner
authorized by the Administrator. Notwithstanding the foregoing, the
Grantee may designate one or more beneficiaries of the Grantee’s Award in the
event of the Grantee’s death on a beneficiary designation form provided by the
Administrator. Following the death of the Grantee, the Option, to the
extent provided in Section 8, may be exercised by the Grantee’s legal
representative or by any person empowered to do so under the deceased Xxxxxxx’s
will or under the then applicable laws of descent and
distribution. The terms of the Option shall be binding upon the
executors, administrators, heirs, successors and transferees of the
Grantee.
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If the
Grantee transfers an Award to a Holding Company, the Grantee and the Holding
Company shall enter into an agreement with the Company substantially in the form
attached hereto as Exhibit C, which shall provide, among other things, the
following: (i) the Holding Company shall agree to be bound by the Plan and the
relevant provisions of the Notice and the Option Agreement; and (ii) neither the
Holding Company nor the Grantee shall permit any direct or indirect transfer of
equity interests in the Holding Company.
10. Term of
Option. The Option must be exercised no later than the
Expiration Date set forth in the Notice or such earlier date as otherwise
provided herein. After the Expiration Date or such earlier date, the
Option shall be of no further force or effect and may not be
exercised.
11. Forfeiture Of Stock Options
and Profits. Notwithstanding anything to the contrary herein, if a
Grantee engages in any activity or conduct in violation of the non-competition
restrictions of the Grantee’s Labor Contract with the Company or a Related
Entity (or any similar written agreement) after the termination of Continuous
Service, or, if there is no such Agreement or if the Agreement does not contain
a non-competition clause or restriction, and a Grantee Competes (as defined
below) with the Company or a Related Entity after the termination of Continuous
Service, then, at the election of the Company: (i) all unexercised Options
(whether vested or unvested) shall immediately terminate and be forfeited and
the Grantee or his or her beneficiaries or representatives shall not be able to
exercise the Options, and (ii) to the extent the Grantee or his or her
beneficiaries or representatives have exercised any Options in the six (6) month
period ending on the date the Grantee first engaged in the violation of the
non-competition restrictions, the Company may rescind any such exercise of
the Options (in which case the Shares shall be returned to the Company and the
Grantee’s exercise price shall be returned, or, in the case of an Option which
was exercised using the “net exercise” clause in Section 4(e) above, the Shares
shall be returned to the Company) or, at the Company’s election, the Grantee may
be required to pay to the Company in cash or a cash equivalent acceptable to the
Company an amount equal to any profits Grantee received from the sale of the
shares subject to the Options, whether any such sale occurs during or after the
period of the Grantee’s Continuous Service for the Company or before or after
the conduct occurs that violates the terms of the agreements with the
Company. The amount of a Grantee’s profits for these purposes will be
calculated as the difference between the sale price for the shares and the price
he or she paid to exercise the Options. In any case there shall be no
offset from the amount owed the Company (including in a case where shares are
returned) for any tax liability a Grantee may have incurred as a result of the
exercise of the option or the sale of the shares. The Grantee agrees
to return the shares or make this payment to the Company, as applicable, no
later than thirty (30) days after the date the Company requests such return or
payment. The Grantee also consents to a deduction from any amounts
the Company owes them from time to time (including amounts owed as wages or
other compensation, fringe benefits, or vacation pay, as well as any other
amounts owed by the Company) to the extent of the amount the Grantee is
obligated to pay the Company under this Section. Whether or not the
Company elects to make any set-off in whole or part, if the Company does not
recover by means of set-off the full amount a Grantee owes it, the Grantee
agrees to pay the unpaid balance within the time period specified
above. For the purposes of this Section 11, a Grantee “Competes” with
the Company if such Grantee (during the period of Xxxxxxx’s employment with the
Company, and for the period of six (6) months after the date Grantee’s
employment with the Company ends for any reason) provides services, similar to
those he or she provided to the Company, to any person or entity “in
competition” (as defined below) with the Company anywhere in the
world. At the present time, the Company and Related Entities engage
in the wholesale and retail sale of vehicles (including auto trading), vehicle
parts and vehicle accessories; vehicle repair and maintenance; insurance agency;
vehicle trade-in business; used car sales business; and vehicle consulting
services and vehicle storage services. The Grantee understands that
the scope and nature of Grantee’s activities and services, and the Company’s
business, products or services, may change as the Company
develops. The Grantee agrees that the scope of this provision will
change to cover any changes in Grantee’s activities or services, as well as any
changes in the Company or a Related Entity’s business, products or services,
during Grantee’s Continuous Service with the Company.
12. Stop-Transfer
Notices. In order to ensure compliance with the restrictions
on transfer set forth in this Option Agreement, the Notice or the Plan, the
Company may issue appropriate “stop transfer” instructions to its transfer
agent, if any, and, if the Company transfers its own securities, it may make
appropriate notations to the same effect in its own records.
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13. Refusal to
Transfer. The Company shall not be required (i) to transfer on
its books any Shares that have been sold or otherwise transferred in violation
of any of the provisions of this Option Agreement or (ii) to treat as owner of
such Shares or to accord the right to vote or pay dividends to any purchaser or
other transferee to whom such Shares shall have been so
transferred.
14. Lock-Up
Agreement.
(a) Agreement. The
Grantee (including any Holding Company of such Grantee, as applicable), if
requested by the Company and the lead underwriter of any public offering of the
Ordinary Shares (the “Lead Underwriter”), hereby irrevocably agrees not to sell,
contract to sell, grant any option to purchase, transfer the economic risk of
ownership in, make any short sale of, pledge or otherwise transfer or dispose of
any interest in any Ordinary Shares or any securities convertible into or
exchangeable or exercisable for or any other rights to purchase or acquire
Ordinary Shares (except Ordinary Shares included in such public offering or
acquired on the public market after such offering) during the 200-day period
following the effective date of a registration statement of the Company filed
under the Securities Act of 1933, as amended, or such shorter or longer period
of time as the Lead Underwriter shall specify. The Grantee further
agrees to sign such documents as may be requested by the Lead Underwriter to
effect the foregoing and agrees that the Company may impose stop-transfer
instructions with respect to such Ordinary Shares subject to the lock-up period
until the end of such period. The Company and the Grantee acknowledge
that each Lead Underwriter of a public offering of the Company’s stock, during
the period of such offering and for the lock-up period thereafter, is an
intended beneficiary of this Section 14.
(b) No Amendment Without Consent
of Underwriter. During the period from identification of a
Lead Underwriter in connection with any public offering of the Company’s
Ordinary Shares until the earlier of (i) the expiration of the lock-up period
specified in Section 14(a) in connection with such offering or (ii) the
abandonment of such offering by the Company and the Lead Underwriter, the
provisions of this Section 14 may not be amended or waived except with the
consent of the Lead Underwriter.
15. Entire Agreement: Governing
Law. The Notice, the Plan and this Option Agreement constitute
the entire agreement of the parties with respect to the subject matter hereof
and supersede in their entirety all prior undertakings and agreements of the
Company and the Grantee with respect to the subject matter hereof, and may not
be modified adversely to the interest of the Grantee (including any Holding
Company of such Grantee, as applicable) except by means of a writing signed by
the Company and the Grantee (or the Holding Company of such Grantee, as
applicable). Nothing in the Notice, the Plan and this Option
Agreement (except as expressly provided therein) is intended to confer any
rights or remedies on any persons other than the parties. The Notice,
the Plan and this Option Agreement are to be construed in accordance with and
governed by the internal laws of Hong Kong without giving effect to any choice
of law rule that would cause the application of the laws of any jurisdiction
other than the internal laws of Hong Kong to the rights and duties of the
parties. Should any provision of the Notice, the Plan or this Option
Agreement be determined to be illegal or unenforceable, such provision shall be
enforced to the fullest extent allowed by law and the other provisions shall
nevertheless remain effective and shall remain enforceable.
16. Construction. The
captions used in the Notice and this Option Agreement are inserted for
convenience and shall not be deemed a part of the Option for construction or
interpretation. Except when otherwise indicated by the context, the
singular shall include the plural and the plural shall include the
singular. Use of the term “or” is not intended to be exclusive,
unless the context clearly requires otherwise.
17. Administration and
Interpretation. Any question or dispute regarding the
administration or interpretation of the Notice, the Plan or this Option
Agreement shall be submitted by the Grantee (or the Holding Company of such
Grantee, as applicable) or by the Company to the Administrator. The
resolution of such question or dispute by the Administrator shall be final and
binding on all persons.
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18. Arbitration. The
Company, the Grantee (including any Holding Company of such Grantee), and the
Grantee’s assignees pursuant to Section 9 (the “parties”) agree that any
suit, action, or proceeding arising out of or relating to the Notice, the Plan
or this Option Agreement shall be referred to and determined by arbitration at
the Hong Kong International Arbitration Centre and in accordance with its
Domestic Arbitration Rules. The arbitration proceedings shall be
conducted in the English language. The parties shall have the right
to conduct discovery which provides them with access to documents and witnesses
that are essential to the dispute, as determined by the
arbitrator. The parties agree that the arbitrator shall have no
authority to vary the terms of the Notice, the Plan or this Option Agreement or
to award any punitive, consequential, incidental, indirect or special damages,
interest, fees or expenses. The arbitrator’s written award shall
include the essential findings and conclusions upon which the award is
based. The decision of the arbitrator shall be final and may be
enforced in any court of competent jurisdiction. In no event shall a
demand for arbitration be made after the date when the applicable statute of
limitations would bar the institution of a legal or equitable proceeding based
on such claim, dispute or other matter in question. The parties shall
bear their own attorneys’ fees and other costs arising under this
Section 18 except as otherwise required by law. If any one or
more provisions of this Section 18 shall for any reason be held invalid or
unenforceable, it is the specific intent of the parties that such provisions
shall be modified to the minimum extent necessary to make it or its application
valid and enforceable.
19. Notices. Any
notice required or permitted hereunder shall be given in writing and shall be
deemed effectively given upon personal delivery, upon deposit for delivery by an
internationally recognized express mail courier service or upon deposit in the
United States mail by certified mail (if the parties are within the United
States), with postage and fees prepaid, addressed to the other party at its
address as shown in these instruments, or to such other address as such party
may designate in writing from time to time to the other party.
20. Confidentiality. The
Grantee (including any Holding Company of such Grantee) shall keep the terms of
this Option Agreement, the Notice and Plan strictly confidential and may not
discuss such terms with anyone except the Plan Administrator or persons
authorized by the Plan Administrator. If the Grantee breaches the
confidentiality obligations under this Section 20, the Company shall have the
right to revoke the Option.
END
OF AGREEMENT
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EXHIBIT
A
AUTOCHINA
INTERNATIONAL LIMITED
2009
EQUITY INCENTIVE PLAN
EXERCISE
NOTICE
AutoChina
International Limited
Attention:
Corporate Secretary
1. Effective
as of today, ______________, the undersigned (the “Holder”) hereby elects to
exercise the Holder’s option to purchase ___________ Ordinary Shares (the
“Shares”) of AutoChina International Limited, a company incorporated under the
laws of the Cayman Islands, (the “Company”) under and pursuant to the Company’s
2009 Equity Incentive Plan, as amended from time to time (the “Plan”) and the
Share Option Award Agreement (the “Option Agreement”) and Notice of Share Option
Award (the “Notice”) dated ______________, ________. Unless otherwise
defined herein, the terms defined in the Plan shall have the same defined
meanings in this Exercise Notice. The Holder elects to pay the full
Exercise Price for the Shares by the following means, as authorized by the
Option Agreement:
o Cash
o Check
o Surrender or
Attestation of Previously Owned Shares
o Broker-Dealer Sale and
Remittance Procedure
o Net
Exercise
A
combination of the foregoing methods of payment, with the number of Ordinary
Shares pursuant to each of the foregoing methods of payment set forth
immediately as follows in (parenthesis): Cash (________________), Check
(________________), Surrender of Attestation of Previously Owned Shares
(________________), Broker-Dealer Sale and Remittance Procedure
(________________), Net Exercise (________________)
2. Representations of the
Holder. The Holder acknowledges that the Holder has received,
read and understood the Notice, the Plan and the Option Agreement and agrees to
abide by and be bound by their terms and conditions.
3. Rights as
Shareholder. Until the issue of such Shares has been
registered in the Register of Members of the Company, no right to vote or
receive dividends or any other rights as a shareholder shall exist with respect
to the Shares, notwithstanding the exercise of the Option. The
Company shall register the issue of such Shares in the Register of Members of
the Company and issue (or cause to be issued) such share certificate promptly
after the Option is exercised. No adjustment will be made for a
dividend or other right for which the record date is prior to the date the share
certificate is issued, except as provided in Section 10 of the
Plan. The Holder shall enjoy rights as a shareholder until such time
as the Holder disposes of the Shares.
4. Delivery of
Payment. The Holder herewith delivers to the Company the full
Exercise Price for the Shares, which, to the extent selected, shall be deemed to
be satisfied by use of the broker-dealer sale and remittance procedure to pay
the Exercise Price provided in Section 4(d) of the Option
Agreement.
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5. Tax
Consultation. The Holder understands that the Holder may
suffer adverse tax consequences as a result of the Holder’s purchase or
disposition of the Shares. The Holder represents that the Holder has
consulted with any tax consultants the Holder deems advisable in connection with
the purchase or disposition of the Shares and that the Holder is not relying on
the Company for any tax advice.
6. Taxes. The
Holder agrees to satisfy all applicable federal, state and local income and
employment tax withholding obligations and herewith delivers to the Company the
full amount of such obligations or has made arrangements acceptable to the
Company to satisfy such obligations.
7. Restrictive
Legends. The Holder understands and agrees that the Company
shall cause the legends set forth below or legends substantially equivalent
thereto, to be placed upon any certificate(s) evidencing ownership of the Shares
together with any other legends that may be required by the Company or by state
or federal securities laws:
THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933 (THE “ACT”) OR ANY STATE SECURITIES LAWS AND MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER
THE ACT OR, IN THE OPINION OF COUNSEL SATISFACTORY TO THE ISSUER OF THESE
SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS IN
COMPLIANCE THEREWITH.
THE
SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON
TRANSFER AS SET FORTH IN THE OPTION AGREEMENT BETWEEN THE ISSUER AND THE
ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE
PRINCIPAL OFFICE OF THE ISSUER. SUCH TRANSFER RESTRICTIONS ARE
BINDING ON TRANSFEREES OF THESE SHARES.
8. Successors and
Assigns. The Company may assign any of its rights under this
Exercise Notice to single or multiple assignees, and this agreement shall inure
to the benefit of the successors and assigns of the Company. Subject
to the restrictions on transfer herein set forth, this Exercise Notice shall be
binding upon the heirs, executors, administrators, successors and assigns of the
Holder.
9. Construction. The
captions used in this Exercise Notice are inserted for convenience and shall not
be deemed a part of this agreement for construction or
interpretation. Except when otherwise indicated by the context, the
singular shall include the plural and the plural shall include the
singular. Use of the term “or” is not intended to be exclusive,
unless the context clearly requires otherwise.
10. Administration and
Interpretation. The Holder hereby agrees that any question or
dispute regarding the administration or interpretation of this Exercise Notice
shall be submitted by the Holder or by the Company to the
Administrator. The resolution of such question or dispute by the
Administrator shall be final and binding on all persons.
11. Governing Law;
Severability. This Exercise Notice is to be construed in
accordance with and governed by the internal laws of Hong Kong without giving
effect to any choice of law rule that would cause the application of the laws of
any jurisdiction other than the internal laws of Hong Kong to the rights and
duties of the parties. Should any provision of this Exercise Notice
be determined by a court of law to be illegal or unenforceable, such provision
shall be enforced to the fullest extent allowed by law and the other provisions
shall nevertheless remain effective and shall remain enforceable.
12. Notices. Any
notice required or permitted hereunder shall be given in writing and shall be
deemed effectively given upon personal delivery, upon deposit for delivery by an
internationally recognized express mail courier service or upon deposit in the
United States mail by certified mail (if the parties are within the United
States), with postage and fees prepaid, addressed to the other party at its
address as shown below beneath its signature, or to such other address as such
party may designate in writing from time to time to the other
party.
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13. Further
Instruments. The parties agree to execute such further
instruments and to take such further action as may be reasonably necessary to
carry out the purposes and intent of this agreement.
14. Entire
Agreement. The Notice, the Plan and the Option Agreement are
incorporated herein by reference and together with this Exercise Notice
constitute the entire agreement of theparties with respect to the subject matter
hereof and supersede in their entirety all prior undertakings and agreements of
the Company and the Holder with respect to the subject matter hereof, and may
not be modified adversely to the Holder’s interest except by means of a writing
signed by the Company and the Holder. Nothing in the Notice, the
Plan, the Option Agreement and this Exercise Notice (except as expressly
provided therein) is intended to confer any rights or remedies on any persons
other than the parties.
|
Submitted
by:
|
Accepted
by:
|
||
|
HOLDER:
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AUTOCHINA
INTERNATIONAL LIMITED
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By:
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(Signature)
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Title:
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Address:
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Address:
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9
EXHIBIT
B
AUTOCHINA
INTERNATIONAL LIMITED
2009
EQUITY INCENTIVE PLAN
INVESTMENT
REPRESENTATION STATEMENT
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GRANTEE:
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COMPANY:
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AUTOCHINA INTERNATIONAL
LIMITED
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SECURITY:
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ORDINARY SHARES
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AMOUNT:
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DATE:
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In
connection with the purchase of the above-listed Securities, the undersigned
Grantee represents to the Company the following:
(a) Grantee
is aware of the Company’s business affairs and financial condition and has
acquired sufficient information about the Company to reach an informed and
knowledgeable decision to acquire the Securities. Grantee is
acquiring these Securities for investment for Xxxxxxx’s own account only and not
with a view to, or for resale in connection with, any “distribution” thereof
within the meaning of the Securities Act of 1933, as amended (the “Securities
Act”).
(b) Grantee
acknowledges and understands that the Securities constitute “restricted
securities” under the Securities Act and have not been registered under the
Securities Act in reliance upon a specific exemption therefrom, which exemption
depends upon among other things, the bona fide nature of Xxxxxxx’s investment
intent as expressed herein. Grantee further understands that the
Securities must be held indefinitely unless they are subsequently registered
under the Securities Act or an exemption from such registration is
available. Xxxxxxx further acknowledges and understands that the
Company is under no obligation to register the Securities. Xxxxxxx
understands that the certificate evidencing the Securities will be imprinted
with a legend which prohibits the transfer of the Securities unless they are
registered or such registration is not required in the opinion of counsel
satisfactory to the Company.
(c) Grantee
is familiar with the provisions of Rule 701 and Rule 144, each
promulgated under the Securities Act, which, in substance, permit limited public
resale of “restricted securities” acquired, directly or indirectly from the
issuer thereof, in a non-public offering subject to the satisfaction of certain
conditions. Rule 701 provides that if the issuer qualifies under
Rule 701 at the time of the grant of the Option to the Grantee, the
exercise will be exempt from registration under the Securities
Act. In the event the Company becomes subject to the reporting
requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934,
ninety (90) days thereafter (or such longer period as any market stand-off
agreement may require) the Securities exempt under Rule 701 may be resold,
except in the case of affiliates, such Securities may be resold subject to the
satisfaction of the applicable conditions specified by Rule 144, including:
(1) the availability of certain public information about the Company,
(2) the amount of Securities being sold during any three month period not
exceeding specified limitations, (3) the resale being made in an unsolicited
“broker’s transaction,” in transactions directly with a “market maker” or
“riskless principal transactions” (as said terms are defined under the
Securities Exchange Act of 1934) and (4) the timely filing of a
Form 144, if applicable.
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In the
event that the Company does not qualify under Rule 701 at the time of the
grant of the Option, then the Securities may be resold in certain limited
circumstances subject to the provisions of Rule 144, which may require: the
availability of current public information about the Company; the resale to
occur more than a specified period after the purchase and full payment (within
the meaning of Rule 144) for the Securities; and, in the case of the sale of
Securities by an affiliate, the satisfaction of the conditions set forth in
sections (2), (3) and (4) of the paragraph immediately above.
(d) Grantee
further understands that in the event all of the applicable requirements of
Rule 701 or 144 are not satisfied, registration under the Securities Act,
compliance with Regulation A, or some other registration exemption will be
required; and that, notwithstanding the fact that Rules 144 and 701 are not
exclusive, the Staff of the Securities and Exchange Commission has expressed its
opinion that persons proposing to sell private placement securities other than
in a registered offering and otherwise than pursuant to Rules 144 or 701 will
have a substantial burden of proof in establishing that an exemption from
registration is available for such offers or sales, and that such persons and
their respective brokers who participate in such transactions do so at their own
risk. Grantee understands that no assurances can be given that any
such other registration exemption will be available in such event.
(e) Grantee
represents that Grantee is a resident of the state of
____________________.
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Signature
of Grantee:
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Date:
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11
EXHIBIT
C
TRANSFER
AGREEMENT
THIS
TRANSFER AGREEMENT (this “Agreement”) is made as of ____, 200__ by and among
[Grantee] (the “Grantee”), [Holding Company] (the “Holding Company”) and
AutoChina International Limited, a company incorporated under the laws of the
Cayman Islands (the “Company”).
WHEREAS,
the Grantee holds an option (the “Option”) to purchase [ ]
ordinary shares of the Company (the “Shares”);
WHEREAS,
the Option was issued to the Grantee by the Company pursuant to the Company’s
2009 Equity Incentive Plan (the “Plan”) and a Notice and Share Option Award
Agreement (the “Award Agreement”);
WHEREAS,
the Holding Company is an investment holding company wholly owned by the
Grantee;
WHEREAS,
the Plan and the Award Agreement expressly permit the transfer of the Option by
the Grantee to an investment holding company wholly owned by the
Grantee,
NOW,
THEREFORE, the parties hereto agree as follows:
1. The
Grantee hereby agrees to transfer the Option to the Holding Company in
consideration of [ ] ordinary shares of the Holding Company
(the “Holding Company Shares”), and the Holding Company hereby agrees to issue
such Holding Company Shares to the Grantee in exchange for the
Option.
2. The
Holding Company agrees to be bound by all provisions of the Plan and the Award
Agreement (except those that relate to Xxxxxxx’s employment and provision of
services) as if it were the Grantee thereunder.
3. The
Holding Company agrees that it shall not issue any securities to any third party
other than the Grantee. The Holding Company further agrees that it
shall not be involved in any business activity except in connection with its
ownership of the Option, such as exercising the Option (in full or in part) and
holding and disposing of the Shares.
4. Representations
and Warranties.
(i) The
Holding Company hereby represents that its authorized share capital is
[US$ ] divided into [ ] ordinary shares, par value
[US$ each], [ ] of which are issued and
outstanding. As of the date hereof, all of the [ ]
ordinary shares are held by the Grantee. Upon the completion of the
transactions contemplated hereunder, the Grantee will hold [ ]
ordinary shares of the Holding Company, which will represent all of the issued
and outstanding ordinary shares of the Holding Company.
(ii) The
Grantee hereby represents that it has valid title to the Option, free of liens,
charges and other encumbrances, except as provided in the Plan, the Award
Agreement and this Agreement.
(iii) Each
of the parties hereto represents that this Agreement, when delivered, will
constitute the legal, valid and binding obligations of such party, enforceable
against such party in accordance with its terms.
6. Within
five (5) business days following the execution of this Agreement, (i) the
Holding Company shall issue a share certificate to the Grantee representing the
Holding Company Shares and update its register of members accordingly; and (ii)
the Company shall update its records to reflect the transfer of the Option from
the Grantee to the Holding Company.
7. This
Agreement shall be governed by and construed under the laws of the Cayman
Islands.
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8. This
Agreement may be amended with the written consent of the Grantee, the Holding
Company and the Company.
9. This
Agreement may be executed in two or more counterparts, each of which shall be an
original, but all of which together shall constitute one
instrument.
IN
WITNESS WHEREOF, the parties hereto have caused their respective duly authorized
representatives to execute this Agreement as of the date and year first above
written.
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GRANTEE
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HOLDING
COMPANY
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[Name
of company]
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By:
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Name:
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Title:
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THE
COMPANY
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AutoChina
International Limited
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Name:
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Title:
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13
