Exhibit 4.2
SA HOLDINGS, INC.
STOCK OPTION AGREEMENT
UNDER
1994 NON-EMPLOYEE DIRECTOR PLAN
STOCK OPTION AGREEMENT (this "Agreement") entered into this
____ day of ____________________, 199__, between SA HOLDINGS, INC.,
a Delaware corporation (the "Corporation"), and ________________,
a member of the Board of Directors of the Corporation (the
"Optionee," which term as used herein shall be deemed to include
any successor to the Optionee by will or by the laws of descent and
distribution, unless the context shall otherwise require).
The Corporation desires, by affording the Optionee the right
and option (the "Option") to purchase shares of its Common Stock,
$.0001 par value (the "Common Stock"), as hereinafter provided, to
provide an additional incentive to the Optionee to continue to work
for the best interests of, and provide services to, the Corporation
and its stockholders and to that end has adopted the 1994 Stock
Option Plan for Non-Employee Directors of SA Holdings, Inc. (the
"Plan").
NOW, THEREFORE, in consideration of the mutual premises and
undertakings hereinafter set forth, the parties hereto agree as
follows:
1. Definitions. As used herein, the following terms shall
have the respective meanings set forth below:
"Commencement Date" shall mean the date first above
written;
"Option Term" shall mean the period of five (5) years
from the Commencement Date, or such shorter period as may be
prescribed in Sections 6, 7 and 8 hereof; and
"Vested Shares" shall mean the cumulative aggregate
number of Optioned Shares (as defined in Section 2 below)
which are subject to the exercise of the Option at a
particular time determined in accordance with Section 4
hereof.
2. Grant of the Option. The Corporation hereby grants as
of the date of this Agreement to the Optionee the Option, from and
after the Commencement Date, to purchase all or any part of an
aggregate of _________ shares (the "Optioned Shares") of Common
Stock on the terms and conditions hereinafter set forth in
accordance with the terms and provisions of the Plan. A copy of
the Plan as in effect on the date hereof has been supplied to the
Optionee, and the Optionee hereby acknowledges receipt thereof.
3. Exercise Price. The purchase price of the Optioned
Shares shall be $_________ per Optioned Share (the "Exercise
Price") which represents 100% of the fair market value of
a share of Common Stock on the date first above written determined
in accordance with the Plan.
4. Terms of the Option. (a) The Option shall vest and
become exercisable on the date which is six (6) months and one (1)
day from the Commencement Date (the "Option Vesting Date").
(b) The number of Optioned Shares which may be
purchased pursuant to the exercise of the Option shall be
cumulative to the extent that Optioned Shares are not theretofore
purchased in accordance with the terms hereof. Subject to the
provisions of this Section 4, the Option shall be exercisable in
whole at any time or in part from time to time during the Option
Term as to any or all Vested Shares; provided, however, that the
Option must be exercised within the Option Term; and provided
further, however, that except as provided in Sections 6, 7 and 8,
the Option may not be exercised unless at the time of exercise the
Optionee shall be a member of the Board of Directors of the
Corporation. Neither the Optionee nor his successors in interest
shall have any rights of a stockholder with respect to any Optioned
Shares until such Optioned Shares shall be issued to him upon the
due exercise of the Option in accordance with the terms hereof.
(c) Any shares of Common Stock acquired upon the
exercise in whole or in part of this Option may not be assigned,
transferred or sold by Optionee except as set forth herein.
Commencing on that date which is one month after the Option Vesting
Date (such date being referred to herein as "Restriction Lapse Date
No. 1"), and on the same day of each successive calendar month
thereafter (each such date being referred to herein as the next
successive Restriction Lapse Date until Restriction Lapse Date 18),
the restrictions for assignment, transfer or sale set forth in this
Agreement shall expire as to, but not more than, the aggregate
number of shares of Common Stock determined in accordance with the
terms of this Agreement and the schedule set forth below, provided
that any shares of Common Stock so assigned, transferred or sold
following exercise of this Option shall be deducted from the
aggregate amount which may be disposed of hereunder.
Aggregate Number of shares of Common Stock
(expressed as a fraction of total number
Restriction of Optioned Shares acquired hereunder)
Lapse Date No. which may be sold
-------------- ------------------------------------------
1 1/18
2 2/18
3 3/18
4 4/18
5 5/18
6 6/18
7 7/18
8 8/18
9 9/18
10 10/18
11 11/18
12 12/18
13 13/18
14 14/18
15 15/18
16 16/18
17 17/18
18 18/18
(d) In the event the Optionee is no longer performing
services to the Corporation as a director (for any reason
whatsoever) the Corporation shall, for a period of twenty-four (24)
full months following the Commencement Date, have the exclusive and
irrevocable right, but not the obligation (the "Company's Right of
Repurchase"), to require the Optionee to sell to the Corporation an
amount of shares of Common Stock equivalent to the total number of
shares acquired by the Optionee pursuant to the terms of this
Option, for an amount per share equivalent to the original Exercise
Price applicable to such Optioned Shares (the "Reacquisition
Price"). The Corporation may exercise the Company's Right of
Repurchase by providing Optionee written notice of its intention to
do so. Thereafter, Optionee shall have five (5) days to provide
the Corporation with an appropriate Assignment and such other
instruments and documents as requested by the Corporation and its
counsel to effect such assignment to the Corporation. Upon receipt
of such documents, the Corporation shall pay to Optionee the
aggregate Reacquisition Price.
5. Restriction on Transfer. Except as provided in Section
7 below, the Option may not be transferred, pledged, assigned or
hypothecated in any way by the Optionee and may be exercised only
by the Optionee. The Option shall not be subject to execution,
attachment or similar process. Any attempted assignment, transfer,
pledge, hypothecation or other disposition of the Option contrary
to the provisions hereof, and the levy of any execution, attachment
or similar process upon the Option, shall be null and void and
without effect.
6. Termination of Relationship. Except as provided in
Sections 7 and 8, in the event the Optionee shall cease to be a
member of the Board of Directors of the Corporation, the Option, to
the extent not theretofore exercised, shall terminate after the
passage of thirty (30) days from the date of such termination
regardless of the reason; therefor, but in no event shall Optionee
be permitted to exercise said Option after the expiration of the
Option Term.
7. Death of Optionee. In the event of the death of the
Optionee, the Option may be exercised with respect to any or all
Vested Shares not theretofore purchased upon prior exercise of the
Option, at any time within a period of one (1) year after the death
of the Optionee (except that in the event of the death of the
Optionee during the thirty (30) day period referenced in Section 6
above, the option exercise period shall be decreased to 180 days
after the date that said Optionee dies), but in no event shall the
Option be exercised after the expiration of the Option Term, by the
estate, legatee, distributee or beneficiary of the Optionee or any
of their respective legal representatives to the same extent as the
Option could have been exercised on the date of death of the
Optionee by the Optionee.
8. Merger, Consolidation, Sale of Assets, etc., Resulting
in a Change in Control. (a) In the event of a Change in Control
(as hereinafter defined), notwithstanding the provisions of Section
4, the Company's Right of Repurchase shall immediately be and
become null and void ab initio and shall no longer be exercisable
by the Corporation if, within two (2) years of such Change in
Control, the Optionee shall cease for any reason to be a member of
the Board of Directors of the Corporation. For purposes of this
Agreement, a Change in Control of the Corporation shall be deemed
to have occurred if (i) there shall be consummated (x) any
consolidation or merger of the Corporation in which the Corporation
is not the continuing or surviving corporation or pursuant to which
shares of the Common Stock would be converted into cash, securities
or other property, other than a merger of the Corporation in which
the holders of the Common Stock immediately prior to the merger
have the same proportionate ownership of common stock of the
surviving corporation immediately after the merger, or (y) any
sale, lease, exchange or other transfer (in one transaction or a
series of related transactions) of all, or substantially all, of
the assets of the Corporation; or (ii) the stockholders of the
Corporation approve any plan or proposal for the liquidation or
dissolution of the Corporation; or (iii) any person (as such term
is used in Sections 13(d) and 14(d)(2) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act")), shall become the
beneficial owner (within the meaning of Rule 13d-3 under the
Exchange Act) of 30% or more of the Corporation's outstanding
Common Stock, except for any person who had such beneficial
ownership prior to the date hereof; or (iv) during any period of
two (2) consecutive years, individuals who at the beginning of such
period constitute the entire Board of Directors shall cease for any
reason to constitute a majority thereof; provided, however, that an
event or series of events described in (i), (ii), (iii) or (iv)
above shall not constitute a Change in Control if a majority of the
directors in office who were also directors on the date which is
three (3) years prior to the occurrence of such an event shall so
determine.
(b) Any exercise of the Option permitted pursuant to
Section 8(a) shall be made within 180 days of the Optionee's
termination as a director of the Corporation.
9. Reorganization, Merger, Consolidation, etc. In the
event that, at any time after the date hereof, the outstanding
shares of the Common Stock are changed into or exchanged for a
different number or kind of shares or other securities of the
Corporation or another corporation by reason of any reorganization,
merger, consolidation, recapitalization, reclassification, stock
split-up, combination of shares or dividend payable in capital
stock, the Option shall thereafter be exercisable for the kind and
number of shares of stock or other securities of the Corporation or
of the corporation resulting therefrom to which the holder of the
number of Optioned Shares not theretofore purchased by the Optionee
thereunder would have been entitled thereupon. Such adjustment
shall be made without change in the total price applicable to the
Optioned Shares not theretofore purchased by the Optionee, but with
a corresponding adjustment in the Exercise Price per Optioned
Share.
10. Representations, Warranties and Agreements of the
Optionee. The Optionee hereby confirms that the Optioned Shares,
when issued to the Optionee pursuant to the terms of this
Agreement, will be issued subject to the provisions, conditions and
restrictions of this Agreement and agrees that in consideration of
the grant of the Option he or she will continue to serve as a
director of the Corporation during the term for which he or she was
elected. In addition, unless the Optioned Shares have been
effectively registered under the Securities Act of 1933, as amended
(the "Securities Act"), the Optionee hereby further represents,
warrants and agrees as follows:
(a) that he or she will acquire any Optioned Shares
for his own account, for investment and not with a view to the
distribution thereof within the meaning of the Securities Act;
(b) that he or she understands that the Optioned
Shares have not been registered under the Securities Act by reason
of their issuance by the Corporation in a transaction exempt from
the registration requirements of the Securities Act; and that the
Optioned Shares must be held by the Optionee indefinitely unless a
subsequent disposition thereof is registered under the Securities
Act or is exempt from such registration;
(c) that he or she further understands that the
exemption from registration afforded by Rule 144 (the provisions of
which are known to the Optionee) promulgated under the Securities
Act depends on the satisfaction of various conditions and that, if
applicable, Rule 144 affords the basis for sales under certain
circumstances only in limited amounts; and
(d) that he or she will not transfer any of the
Optioned Shares acquired by him or her except pursuant to a
registration statement filed pursuant to the Securities Act or an
exemption therefrom.
11. Stock Legend. In order to assure compliance with the
restrictions upon transfer contained in this Agreement, the
certificates representing the Optioned Shares when issued, and each
certificate issued in exchange for or upon transfer of any of the
Optioned Shares, shall, unless and until the Optioned Shares shall
have been registered under the Securities Act or be
exempt from registration thereunder, be stamped or otherwise
imprinted with a legend in substantially the following form:
"THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933. THEY MAY NOT BE SOLD, OFFERED
FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES
UNDER SAID ACT OR PURSUANT TO AN EXEMPTION FROM
REGISTRATION OR AN OPINION OF COUNSEL SATISFACTORY TO THE
COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED."
In addition, the Optionee hereby agrees that the Corporation may
issue appropriate stop transfer orders to the Corporation's
transfer agents with respect to the Optioned Shares.
12. Exercise of Option. Subject to the terms and
conditions of this Agreement, the Option may be exercised by
written notice to the Corporation, at its principal executive
office, which is now located at ▇▇▇▇ ▇▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, Attention: Vice President-Finance. Such notice shall
state the election to exercise the Option and the number of
Optioned Shares with respect to which the Option is being
exercised, and shall be signed by the person or persons so
exercising the Option. Such notice shall be accompanied by payment
by official bank or certified check payable to the Corporation for
the full Exercise Price of the Optioned Shares to be purchased.
The Corporation shall issue and deliver a certificate or
certificates representing such Optioned Shares as soon as
practicable (but in no event more than thirty (30) days)
after such notice and payment are received at such time, place and
manner as may be agreed upon by the Corporation and the person or
persons exercising the Option. The certificate or certificates
representing the Optioned Shares as to which the Option shall have
been so exercised shall be registered in the name of the person or
persons so exercising the Option, shall have placed thereon the
legend, if any, required by Section 11 and shall be delivered as
aforesaid to or upon the written order of the person or persons
exercising the Option. In the event that the Option shall be
exercised pursuant to Section 7 by any person or persons other than
the Optionee, such notice shall be accompanied by appropriate proof
of the right of such person or persons to exercise the Option. All
Optioned Shares that shall be purchased upon the exercise of the
Option as provided herein shall be fully paid and nonassessable.
13. Restrictions on Issue of Shares. Anything contained in
this Agreement to the contrary notwithstanding, the Corporation may
delay the issuance of Optioned Shares covered by the exercise of
the Option and the delivery of a certificate for such Optioned
Shares until one of the following conditions shall be satisfied:
(i) Optioned Shares with respect to which the
Option has been exercised are at the time of the issue or
transfer of such Optioned Shares effectively registered under
applicable federal securities laws now in force or hereafter
amended; or
(ii) counsel for the Corporation shall have
given an opinion, which opinion shall not be unreasonably
conditioned or withheld, that such Optioned Shares are exempt
from the registration under applicable federal securities
laws now in force or hereafter amended.
It is intended that all exercises of the Option shall be effective.
Accordingly, the Corporation shall use its best efforts to bring
about compliance with the above conditions within a reasonable
time, except that the Corporation shall be under no obligation to
cause a registration statement or a post-effective amendment to any
registration statement to be prepared at its expense solely for the
purpose of covering the issuance or transfer from the Corporation's
treasury of Optioned Shares in respect of which any option may be
exercised.
14. Taxes. The Optionee or such other person exercising
the Option in accordance herewith shall pay any and all taxes
related to the exercise of the Option, as such taxes become due.
If requested by the Corporation, the Optionee shall present
evidence of such payment to the Corporation.
15. Agreement Subject to Plan. The Option granted hereby
is subject to the detailed provisions with respect thereto set
forth in the Plan. Anything contained herein to the contrary
notwithstanding, in the event of a conflict between any provision
hereof and the provisions of the Plan, the provisions of the Plan
shall in all respects control.
16. No Waiver. No waiver of any breach or condition of
this Agreement shall be deemed to be a waiver of any other or
subsequent breach or condition, whether of like or different
nature.
17. Governing Law. This Agreement shall be governed by,
and construed in accordance with, the laws of the State of Delaware
applicable to contracts made and to be performed wholly therein.
18. Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original,
but all of which together shall constitute one and the same
instrument.
19. Entire Agreement. This Agreement and the Plan
constitute the entire agreement between the parties with respect to
the subject matter hereof, and supersede all previously written or
oral negotiations, commitments, representations and agreements with
respect thereto.
20. Amendments. This Agreement may not be modified,
amended, terminated or in any way changed, except by an agreement
in writing signed by the parties hereto.
SA HOLDINGS, INC.
By:__________________________________
Name:________________________________
Title:_______________________________
OPTIONEE:
_____________________________________
Name:________________________________
Address:_____________________________
_____________________________
_____________________________
