AUTOWEB, INC. Non-Employee Director Stock Option Award Agreement (Non-Qualified Stock Option)
Exhibit 99.2
2018 EQUITY INCENTIVE PLAN
(Non-Qualified Stock Option)
This
Non-Employee Director Stock Option Award Agreement
(“Agreement”) is
entered into effective as of the Grant Date set forth on the
signature page to this Agreement (“Grant Date”), by and between
AutoWeb, Inc., a Delaware corporation (“Company”), and the member of
Company’s Board set forth as Participant on the signature
page hereto (“Participant”).
This
Agreement and the stock options granted hereby are subject to the
provisions of the AutoWeb, Inc. 2018 Equity Incentive Plan
(“Plan”). In the
event of a conflict between the provisions of the Plan and this
Agreement, the Plan shall control. Capitalized terms used but not
defined in this Agreement shall have the meanings assigned to such
terms in the Plan.
1. Grant of Options. Company
hereby grants to Participant non-qualified stock options
(“Options”) to
purchase the number of shares of common stock of Company, par value
$0.001 per share, set forth on the signature page to this Agreement
(“Shares”), at
the exercise price per Share set forth on the signature page to
this Agreement (“Exercise
Price”). The Options are not intended to qualify as
incentive stock options under Section 422 of the Code.
2. Term of Options. Unless the
Options terminate earlier pursuant to the provisions of this
Agreement or the Plan, the Options shall expire on the
seventh (7th) anniversary of the
Grant Date (“Option
Expiration Date”).
3. Vesting. The Options shall vest
in twelve monthly installments of one-twelfth (1/12) each on the
[Day] day of each month commencing [One Month After Grant
Date].
4. Exercise of
Options.
(a
)
Manner of Exercise. To the
extent vested, the Options may be exercised, in whole or in part,
by delivering written notice to Company in accordance with Section
6(f) of this Agreement in such form as Company may require from
time to time, or at the direction of Company, through the
procedures established with Company’s third-party option
administration service. Such notice shall specify the number of
Shares, subject to the Options that are being exercised, and shall
be accompanied by full payment of the Exercise Price of such Shares
in a manner permitted under the terms of Section 5.5 of the Plan
(including same-day sales through a broker), except that payment in
whole or in part in a manner set forth in clauses (ii), (iii), or
(iv) of Section 5.5(b) of the Plan may only be made with the
consent of the Committee. The Options may be exercised only in
multiples of whole Shares, and no fractional Shares shall be
issued.
(b
)
Issuance of Shares. Upon
exercise of the Options and payment of the Exercise Price for the
Shares as to which the Options are exercised and satisfaction of
all applicable tax withholding requirements, if any, the Company
shall issue to Participant the applicable number of Shares in the
form of fully paid and nonassessable Shares.
(c
)
Withholding. No Shares will be
issued on exercise of the Options unless and until Participant pays
to Company, or makes satisfactory arrangements with Company for
payment of, any federal, state, local or foreign taxes required by
law to be withheld in respect of the exercise of the Options.
Participant hereby agrees that Company may withhold from
Participant’s wages or other remuneration the applicable
taxes. At the discretion of Company, the applicable taxes may be
withheld in kind from the Shares otherwise deliverable to
Participant on exercise of the Options, up to Participant’s
minimum required withholding rate or such other rate determined by
the Committee that will not trigger a negative accounting
impact.
5. Termination of
Options.
(a)
Termination Upon Expiration of Option
Term. The Options shall terminate and expire in their
entirety on the Option Expiration Date. In no event may Participant
exercise the Options after the Option Expiration Date, even if the
application of another provision of this Section 5 may result in an
extension of the exercise period for the Options beyond the Option
Expiration Date.
(b)
Termination of Service as
a Director.
(i) Termination
of Service as a Director Other Than Due to Death, Disability or
Cause. Participant may exercise the vested portion of the
Options for a period of twelve (12) months (but in no event later
than the Option Expiration Date) following any termination of
Participant’s service as a Director of Company (including
termination of service by reason of Participant’s
resignation, failure to be re-elected or failure to be nominated
for re-election), other than in the event of a termination of
Participant’s service as a Director due to Removal for Cause
(as defined below) or by reason of Participant’s death or
Disability (as defined below). In the event the termination of
Participant’s service as a Director or the Company is due to
resignation, failure to be re-elected, failure to be nominated for
re-election, or without Removal for Cause, any unvested portion of
the Options shall immediately become fully vested as of the date of
such termination of service. To the extent Participant is not
entitled to exercise the Options at the date of termination of
service as a Director, or if Participant does not exercise the
Options within the time specified in the Plan or this Agreement for
post-termination of service exercises of the Options, the Options
shall terminate.
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(ii) Termination
of Service Due to Removal for Cause. Upon the termination of
Participant’s service as a Director due to Removal for Cause,
unless the Options have earlier terminated, the Options (whether
vested or not) shall immediately terminate in their entirety and
shall thereafter not be exercisable to any extent whatsoever;
provided that Company, in its discretion, may, by written notice to
Participant given as of the date of Removal for Cause, authorize
Participant to exercise any vested portion of the Options for a
period of up to thirty (30) days following Participant’s
termination of service due to Removal for Cause, provided that in
no event may Participant exercise the Options after the Option
Expiration Date. For purposes of this Agreement,
“Removal for
Cause” shall mean a removal of Participant as a member
of the Board by Company’s stockholders pursuant to applicable
corporate laws governing the removal of
Directors.
(iii)
Termination of
Participant’s Service as a Director By Reason of
Participant’s Death. In the event Participant’s
service as a Director is terminated by reason of
Participant’s death, unless the Options have earlier
terminated, any unvested portion of the Options shall become
immediately and fully vested as of the date of termination. Vested
Options may be exercised at any time within twelve (12) months
following the date of termination (but in no event later than the
Option Expiration Date) by Participant’s executor or personal
representative or the person to whom the Options shall have been
transferred by will or the laws of descent and distribution, but
only to the extent Participant could exercise the Options at the
date of termination.
(iv) Termination
of Participant’s Service as a Director By Reason of
Participant’s Disability. In the event that
Participant ceases to be a Director by reason of
Participant’s Disability, unless the Options have earlier
terminated, any unvested portion of the Options shall become
immediately and fully vested as of the date of termination.
Participant (or Participant’s attorney in fact, conservator
or other representative on behalf of Participant) may, but only
within twelve (12) months from the date of such termination of
service as a Director (and in no event later than the Option
Expiration Date), exercise the Options to the extent Participant
was otherwise entitled to exercise the Options at the date of such
termination of service. For purposes of this Agreement,
“Disability”
shall mean Participant’s becoming “permanently and
totally disabled” within the meaning of Section 22(e)(3) of
the Code or as otherwise determined by the Committee in its
discretion. The Committee may require such proof of Disability as
the Committee in its sole and absolute discretion deems
appropriate, and the Committee’s determination as to whether
Participant has incurred a Disability shall be final and binding on
all parties concerned.
(c)
Change in Control. In the event
of a Change in Control, the effect of the Change in Control on the
Options shall be determined by the applicable provisions of the
Plan (including, without limitation, Article 10 of the Plan),
provided that (i) to the extent the Options are assumed or
substituted by the successor company in connection with the Change
in Control (or the Options are continued by Company if it is the
ultimate parent entity after the Change in Control), the Options
will vest and become fully exercisable in accordance with clause
(i) of Section 10.2(a) of the Plan if within twenty-four (24)
months following the date of the Change in Control
Participant’s service as a Director of the Company is
terminated for any reason other than by reason of removal for
Cause, and any vested Options (either vested prior to the Change in
Control or accelerated by reason of this Section 5(c)) may be
exercised for a period of twenty-four (24) months after the date of
such termination of service (but in no event later than the Option
Expiration Date); and (ii) any portion of the Options which vests
and becomes exercisable pursuant to Section 10.2(b) of the Plan as
a result of such Change in Control will (1) vest and become
exercisable on the day prior to the date of the Change in Control
if Participant is then a member of the Company’s Board and
(2) terminate on the date of the Change in Control. For purposes of
Section 10.2 (a) of the Plan, the Options shall not be deemed
assumed or substituted by a successor company (or continued by
Company if it is the ultimate parent entity after the Change in
Control) if the Options are not assumed, substituted or continued
with equity securities of the successor company or Company, as
applicable, that are publicly-traded and listed on an exchange in
the United States and that have voting, dividend and other rights,
preferences and privileges substantially equivalent to the Shares.
If the Options are not deemed assumed, substituted or continued for
purposes of Section 10.2(a) of the Plan, the Options shall be
deemed not assumed, substituted or continued and governed by
Section 10.2(b) of the Plan. Notwithstanding the foregoing, if on
the date of the Change in Control the Fair Market Value of one
Share is less than the Exercise Price per Share, then the Options
shall terminate as of the date of the Change in Control except as
otherwise determined by the Committee.
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(d)
Extension of
Post-Termination Exercise Period. Notwithstanding any provisions of this
Section 5 to the contrary, if following termination of service on
the Board, the exercise of the Options or, if in conjunction with
the exercise of the Options, the sale of the Shares acquired on
exercise of the Options during the post-termination of service time
period set forth in the paragraph of this Section 5
applicable to the reason for termination of service would, in the
determination of the Company, violate any applicable federal
or state securities laws, rules, regulations or orders (or any
Company policy related thereto, including its securities
trading policy), the running of the applicable period to exercise
the Options shall be tolled for the number of days during the
period that the exercise of the Options or sale of the Shares
acquired on exercise would in the Company's determination
constitute such a violation; provided, however, that in no event
shall the exercisability of the Options be extended beyond the
Option Expiration Date.
(e)
Forfeiture upon Engaging in
Detrimental Activities. If, at any time within the
twelve (12) months after (i) Participant exercises any portion of
the Options; or (ii) the effective date of any termination of
Participant’s service as a Director of Company for any
reason, Participant engages in, or is determined by the Committee
in its sole discretion to have engaged in, any (i) material breach
of any non-competition, non-solicitation, non-disclosure or
settlement or release covenant or agreement with Company or any
Subsidiary; or (ii) activities during the course of
Participant’s service as a Director with Company or any
Subsidiary constituting fraud, embezzlement, theft or dishonesty;
or (iii) activity that is otherwise in conflict with, or adverse or
detrimental to the interests of Company or any Subsidiary, then (x)
the Options shall terminate effective as of the date on which
Participant engaged in or engages in that activity or conduct,
unless terminated sooner pursuant to the provisions of this
Agreement, and (y) the amount of any gain realized by Participant
from exercising all or a portion of the Options at any time
following the date that Participant engaged in any such activity or
conduct, as determined as of the time of exercise, shall be
forfeited by Participant and shall be paid by Participant to
Company, and recoverable by Company, within sixty (60) days
following such termination date of the Options. For purposes of the
foregoing, the following will be deemed to be activities in
conflict with or adverse or detrimental to the interests of Company
or any Subsidiary: (i) Participant’s conviction of, or
pleading guilty or nolo contendere to any misdemeanor involving
moral turpitude or any felony, the underlying events of which
related to Participant’s service as a Director of Company;
(ii) knowingly engaged or aided in any act or transaction by
Company or a Subsidiary that results in the imposition of criminal,
civil or administrative penalties against Company or any
Subsidiary; or (iii) misconduct during the course of
Participant’s service as a Director of Company or any
Subsidiary that results in an accounting restatement by Company due
to material noncompliance with any financial reporting requirement
under applicable securities laws, whether such restatement occurs
during or after Participant’s service as a Director of
Company or any Subsidiary.
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(f)
Reservation of Committee Discretion to
Accelerate Option Vesting and Extend Option Exercise Window.
The Committee reserves the right, in its sole and absolute
discretion, to accelerate the vesting of the Options and to extend
the exercise window for Options that have vested (either in
accordance with the terms of this Agreement or by discretionary
acceleration by the Committee) under circumstances not otherwise
covered by the foregoing provisions of this Section 5; provided
that in no event may the Committee extend the exercise window for
Options beyond the Option Expiration Date. The Committee is under
no obligation to exercise any such discretion and may or may not
exercise such discretion on a case-by-case basis.
(g)
Reversion of Expired, Cancelled and
Forfeited Options to Plan. Any Options that do not vest or
that are cancelled, terminated or expire unexercised are forfeited
and revert to the Plan and shall again be available for Awards
under the Plan.
6.
Miscellaneous.
(a)
No Rights of Stockholder.
Participant shall not have any of the rights of a stockholder with
respect to the Shares subject to this Agreement until such Shares
have been issued upon the due exercise of the Options.
(b)
Nontransferability of Options.
The Options shall be nontransferable or assignable except to the
extent expressly provided in the Plan. Notwithstanding the
foregoing, Participant may by delivering written notice to Company
in a form provided by or otherwise satisfactory to Company,
designate a third party who, in the event of Participant’s
death, shall thereafter be entitled to exercise the Options.
This Agreement is not intended to
confer upon any person other than the parties hereto any rights or
remedies hereunder.
(c)
Severability. If any provision
of this Agreement shall be held unlawful or otherwise invalid or
unenforceable in whole or in part by a court of competent
jurisdiction, such provision shall (i) be deemed limited to the
extent that such court of competent jurisdiction deems it lawful,
valid and/or enforceable and as so limited shall remain in full
force and effect, and (ii) not affect any other provision of this
Agreement or part thereof, each of which shall remain in full force
and effect.
(d)
Governing Law, Jurisdiction and
Venue. This Agreement shall be governed by and interpreted
in accordance with the laws of the State of Delaware other than its
conflict of laws principles. The parties agree that in the event
that any suit or proceeding is brought in connection with this
Agreement, such suit or proceeding shall be brought in the state or
federal courts located in New Castle County, Delaware, and the
parties shall submit to the exclusive jurisdiction of such courts
and waive any and all jurisdictional, venue and inconvenient forum
objections to such courts.
(e)
Headings. The headings in this
Agreement are for reference purposes only and shall not affect the
meaning or interpretation of this Agreement.
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(f
)
Notices. All notices required
or permitted under this Agreement shall be in writing and shall be
sufficiently made or given if hand delivered or mailed by
registered or certified mail, postage prepaid. Notice by mail shall
be deemed delivered on the date on which it is
postmarked.
Notices
to Company should be addressed to:
00000
XxxXxxxxx Xxxx., Xxxxx 000
Irvine,
CA 92612-1400
Attention: Chief
Legal Officer
Notice
to Participant should be addressed to Participant at
Participant’s address as it appears on Company’s
records.
Company
or Participant may by writing to the other party designate a
different address for notices. If the receiving party consents in
advance, notice may be transmitted and received via telecopy or via
such other electronic transmission mechanism as may be available to
the parties. Such notices shall be deemed delivered when
received.
(g)
Agreement Not a Service
Contract. This Agreement is not an employment or service
contract, and nothing in this Agreement or in the granting of the
Options shall be deemed to create in any way whatsoever any
obligation on Participant’s part to continue as a Director or
on Company’s part to continue Participant’s service as
a Director.
(h)
Counterparts. This Agreement
may be executed in multiple counterparts each of which shall be
deemed an original Agreement but all of which, taken together,
shall constitute one and the same Agreement binding on the parties
hereto. The signature of any party hereto to any counterpart hereof
shall be deemed a signature to, and may be appended to, any other
counterpart hereof.
(i)
Administration. The Committee
shall have the power to interpret the Plan and this Agreement and
to adopt such rules for the administration, interpretation and
application of the Plan and this Agreement as are consistent with
the Plan and to interpret or revoke any such rules. All actions
taken and all interpretations and determinations made by the
Committee (including determinations as to the calculation,
satisfaction or achievement of performance-based vesting
requirements, if any, to which the Options are subject) shall be
final and binding upon Participant, Company and all other
interested persons. No member of the Committee shall be personally
liable for any action, determination or interpretation made in good
faith with respect to the Plan or this Agreement.
(j)
Policies and Procedures.
Participant agrees that Company may impose, and Participant agrees
to be bound by, Company policies and procedures with respect to the
ownership, timing and manner of resales of shares of
Company’s securities, including without limitation, (i)
restrictions on xxxxxxx xxxxxxx; (ii) restrictions designed to
delay and/or coordinate the timing and manner of sales by officers,
directors and affiliates of Company following a public offering of
Company’s securities; (iii) stock ownership or holding
requirements applicable to officers and/or directors of Company;
and (iv) the required use of a specified brokerage firm for such
resales.
(k)
Entire Agreement; Modification.
This Agreement and the Plan contain the entire agreement between
the parties with respect to the subject matter contained herein and
may not be modified except as provided in the Plan or in a written
document signed by each of the parties hereto and may be rescinded
only by a written agreement signed by both parties.
Remainder of Page Intentionally Left Blank; Signature Page
Follows
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IN
WITNESS WHEREOF, the parties have executed this Agreement effective
as of the Grant Date.
Grant
Date:
_______________________________________
Total
Options Awarded: ______________________________
Exercise Price Per
Share: _____________________________
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“Company”
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By:
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[Company
Representative]
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[Title]
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“Participant”
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By:
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[Participant’s
Name]
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[Title
]
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