LEAP WIRELESS INTERNATIONAL, INC. 2004 STOCK OPTION, RESTRICTED STOCK AND DEFERRED STOCK UNIT PLAN RESTRICTED STOCK AWARD GRANT NOTICE AND RESTRICTED STOCK AWARD AGREEMENT
EXHIBIT 10.9.11
LEAP WIRELESS INTERNATIONAL, INC.
2004 STOCK OPTION, RESTRICTED STOCK AND
DEFERRED STOCK UNIT PLAN
2004 STOCK OPTION, RESTRICTED STOCK AND
DEFERRED STOCK UNIT PLAN
RESTRICTED STOCK AWARD GRANT NOTICE AND
RESTRICTED STOCK AWARD AGREEMENT
RESTRICTED STOCK AWARD AGREEMENT
Leap Wireless International, Inc. (the “Company”), pursuant to its 2004 Stock Option,
Restricted Stock and Deferred Stock Unit Plan (the “Plan”), hereby grants to the holder listed
below (“Holder”), the right to purchase the number of shares of the Company’s Common Stock set
forth below (the “Shares”) at the purchase price set forth below. This Restricted Stock award is
subject to all of the terms and conditions as set forth herein and in the Restricted Stock Award
Agreement attached hereto as Exhibit A (the “Restricted Stock Agreement”) and the Plan,
each of which are incorporated herein by reference. Unless otherwise defined herein, the terms
defined in the Plan shall have the same defined meanings in this Grant Notice and the Restricted
Stock Agreement.
Holder: |
XXXXX X. XXXXXXXX | |
Xxxxx Date: |
October 26, 2005 | |
Purchase Price per Share: |
$0.0001 per share | |
Total
Number of Shares of Restricted Stock: |
5,000 | |
| The Shares shall be released from the Company’s Repurchase Option set forth in Section 3.1 of the Restricted Stock Agreement on the dates and in the amounts indicated in Exhibit B to this Grant Notice. |
By his or her signature and the Company’s signature below, Xxxxxx agrees to be bound by the terms
and conditions of the Plan, the Restricted Stock Agreement and this Grant Notice. Holder has
reviewed the Restricted Stock Agreement, the Plan and this Grant Notice in their entirety, has had
an opportunity to obtain the advice of counsel prior to executing this Grant Notice and fully
understands all provisions of this Grant Notice, the Restricted Stock Agreement and the Plan.
Holder hereby agrees to accept as binding, conclusive and final all decisions or interpretations of
the Administrator of the Plan upon any questions arising under the Plan, this Grant Notice or the
Restricted Stock Agreement. If Xxxxxx is married, his or her spouse has signed the Consent of
Spouse attached to this Grant Notice as Exhibit C.
| LEAP WIRELESS INTERNATIONAL, INC. | HOLDER: | |||||||||
By: /s/ X. Xxxxxxx Xxxxxxxxx
|
By: /s/ Xxxxx X. Xxxxxxxx | |||||||||
Print
Name:
X. Xxxxxxx Xxxxxxxxx
|
Print Name: Xxxxx X. Xxxxxxxx | |||||||||
Title: President & CEO
|
Title: Executive VP & Chief Marketing Officer | |||||||||
Address:
|
10307 Pacific Center Court | Address: | 000 Xxxxxxxxxx Xxxxx | |||||||
| San Diego, California 92121 | SPECIAL 5-YEAR VESTING RESTRICTED STOCK AWARD (10/26/10) |
|||||||||
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
LEAP WIRELESS INTERNATIONAL, INC.
2004 STOCK OPTION, RESTRICTED STOCK AND
DEFERRED STOCK UNIT PLAN
2004 STOCK OPTION, RESTRICTED STOCK AND
DEFERRED STOCK UNIT PLAN
RESTRICTED STOCK AWARD GRANT NOTICE AND
RESTRICTED STOCK AWARD AGREEMENT
RESTRICTED STOCK AWARD AGREEMENT
Leap Wireless International, Inc. (the “Company”), pursuant to its 2004 Stock Option,
Restricted Stock and Deferred Stock Unit Plan (the “Plan”), hereby grants to the holder listed
below (“Holder”), the right to purchase the number of shares of the Company’s Common Stock set
forth below (the “Shares”) at the purchase price set forth below. This Restricted Stock award is
subject to all of the terms and conditions as set forth herein and in the Restricted Stock Award
Agreement attached hereto as Exhibit A (the “Restricted Stock Agreement”) and the Plan,
each of which are incorporated herein by reference. Unless otherwise defined herein, the terms
defined in the Plan shall have the same defined meanings in this Grant Notice and the Restricted
Stock Agreement.
Holder: |
XXXXX X. XXXXXXXX | |
Xxxxx Date: |
October 26, 2005 | |
Purchase Price per Share: |
$0.0001 per share | |
Total
Number of Shares of Restricted Stock: |
10,000 | |
| The Shares shall be released from the Company’s Repurchase Option set forth in Section 3.1 of the Restricted Stock Agreement on the dates and in the amounts indicated in Exhibit B to this Grant Notice. |
By his or her signature and the Company’s signature below, Xxxxxx agrees to be bound by the terms
and conditions of the Plan, the Restricted Stock Agreement and this Grant Notice. Holder has
reviewed the Restricted Stock Agreement, the Plan and this Grant Notice in their entirety, has had
an opportunity to obtain the advice of counsel prior to executing this Grant Notice and fully
understands all provisions of this Grant Notice, the Restricted Stock Agreement and the Plan.
Holder hereby agrees to accept as binding, conclusive and final all decisions or interpretations of
the Administrator of the Plan upon any questions arising under the Plan, this Grant Notice or the
Restricted Stock Agreement. If Xxxxxx is married, his or her spouse has signed the Consent of
Spouse attached to this Grant Notice as Exhibit C.
| LEAP WIRELESS INTERNATIONAL, INC. | HOLDER: | |||||||
By: /s/ X. Xxxxxxx Xxxxxxxxx
|
By: /s/ Xxxxx X. Xxxxxxxx | |||||||
| Print Name: X. Xxxxxxx Xxxxxxxxx | Print Name: Xxxxx X. Xxxxxxxx | |||||||
| Title: President & CEO | Title: Executive VP & Chief Marketing Officer | |||||||
Address:
|
10307 Pacific Center Court | Address: | 000 Xxxxxxxxxx Xxxxx | |||||
| San Diego, California 92121 | Lake Forest, IL 60045 | |||||||
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
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EXHIBIT A
TO RESTRICTED STOCK AWARD GRANT NOTICE
Pursuant to the Restricted Stock Award Grant Notice (“Grant Notice”) to which this Restricted
Stock Award Agreement (this “Agreement”) is attached, Leap Wireless International, Inc. (the
“Company”) has granted to Holder the right to purchase the number of shares of Restricted Stock
under the Company’s 2004 Stock Option, Restricted Stock and Deferred Stock Unit Plan (the “Plan”)
indicated in the Grant Notice.
ARTICLE I
1.1 Defined Terms. Capitalized terms not specifically defined herein shall have the
meanings specified in the Plan and the Grant Notice.
1.2 Incorporation of Terms of Plan. The Shares are subject to the terms and
conditions of the Plan which are incorporated herein by reference.
ARTICLE II
2.1 Grant of Restricted Stock. In consideration of Holder’s past and/or continued
employment with or service to the Company or its Subsidiaries and for other good and valuable
consideration, effective as of the Grant Date set forth in the Grant Notice (the “Grant Date”), the
Company irrevocably grants to Holder the right to purchase the number of shares of Common Stock set
forth in the Grant Notice (the “Shares”), upon the terms and conditions set forth in the Plan and
this Agreement.
2.2 Purchase Price. The purchase price of the Shares shall be as set forth in the
Grant Notice, without commission or other charge. The payment of the purchase price shall be paid
by cash or check.
2.3 Issuance of Shares. The issuance of the Shares under this Agreement shall occur
at the principal office of the Company simultaneously with the execution of this Agreement by the
parties or on such other date as the Company and Holder shall agree (the “Issuance Date”). Subject
to the provisions of Article IV below, on the Issuance Date, the Company shall issue the Shares
(which shall be issued in Holder’s name).
2.4 Conditions to Issuance of Stock Certificates. The Shares, or any portion thereof,
may be either previously authorized but unissued shares or issued shares which have then been
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reacquired by the Company. Such Shares shall be fully paid and nonassessable. The Company
shall not be required to issue or deliver any Shares prior to fulfillment of all of the following
conditions:
(a) The admission of such Shares to listing on all stock exchanges on which such Common Stock
is then listed; and
(b) The completion of any registration or other qualification of such shares under any state
or federal law or under rulings or regulations of the Securities and Exchange Commission or of any
other governmental regulatory body, which the Administrator shall, in its absolute discretion, deem
necessary or advisable; and
(c) The obtaining of any approval or other clearance from any state or federal governmental
agency which the Administrator shall, in its absolute discretion, determine to be necessary or
advisable; and
(d) The lapse of such reasonable period of time following the Issuance Date as the
Administrator may from time to time establish for reasons of administrative convenience; and
(e) The receipt by the Company of full payment for such Shares, including payment of any
applicable withholding tax, which in the discretion of the Administrator may be in the form of
consideration used by Holder to pay for such Shares, subject to Section 10.4 of the Plan.
2.5 Rights as Stockholder. Except as otherwise provided herein, upon delivery of the
Shares to the escrow holder pursuant to Article IV, Holder shall have all the rights of a
stockholder with respect to said Shares, subject to the restrictions herein, including the right to
vote the Shares and to receive all dividends or other distributions paid or made with respect to
the Shares; provided, however, that any and all cash dividends paid on such Shares and any and all
shares of Common Stock, capital stock or other securities received by or distributed to Holder with
respect to the Shares as a result of any stock dividend stock split, reverse stock split,
recapitalization, combination, reclassification, or similar change in the capital structure of the
Company shall also be subject to the Repurchase Option (as defined in Section 3.1 below) and the
restrictions on transfer in Section 3.4 below until such restrictions on the underlying Shares
lapse or are removed pursuant to this Agreement.
ARTICLE III
3.1 Repurchase Option. Subject to the provisions of Section 3.2 below, if Holder has
a Termination of Employment, Termination of Directorship or Termination of Consultancy, as
applicable, before all of the Shares are released from the Company’s Repurchase Option (as defined
below), the Company shall, upon the date of such Termination (as reasonably fixed and
[*] CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A
REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.
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determined by the Company), have an irrevocable, exclusive option, but not the obligation, for
a period of sixty (60) days, commencing ninety (90) days after the date Holder has a Termination of
Employment, Termination of Directorship or Termination of Consultancy, as applicable, to repurchase
all or any portion of the Unreleased Shares (as defined below in Section 3.3) at such time (the
“Repurchase Option”) at the original cash purchase price per share (the “Repurchase Price”). The
Repurchase Option shall lapse and terminate one hundred fifty (150) days after Holder has a
Termination of Employment, Termination of Directorship or Termination of Consultancy, as
applicable. The Repurchase Option shall be exercisable by the Company by written notice to Holder
or Holder’s executor (with a copy to the escrow agent appointed pursuant to Section 4.1 below) and
shall be exercisable, at the Company’s option, by delivery to Holder or Holder’s executor with such
notice of a check in the amount of the Repurchase Price times the number of Shares to be
repurchased (the “Aggregate Repurchase Price”). Upon delivery of such notice and the payment of
the Aggregate Repurchase Price, the Company shall become the legal and beneficial owner of the
Shares being repurchased and all rights and interests therein or relating thereto, and the Company
shall have the right to retain and transfer to its own name the number of Shares being repurchased
by the Company. In the event the Company repurchases any Shares under this Section 3.1, any
dividends or other distributions paid on such Shares and held by the escrow agent pursuant to
Section 4.1 and the Joint Escrow Instructions shall be promptly paid by the escrow agent to the
Company.
3.2 Release of Shares from Repurchase Restriction. The Shares shall be released from
the Company’s Repurchase Option as indicated in Exhibit B to the Grant Notice. Any of the
Shares released from the Company’s Repurchase Option shall thereupon be released from the
restrictions on transfer under Section 3.4. In the event any of the Shares are released from the
Company’s Repurchase Option, any dividends or other distributions paid on such Shares and held by
the escrow agent pursuant to Section 4.1 and the Joint Escrow Instructions shall be promptly paid
by the escrow agent to Holder.
3.3 Unreleased Shares. Any of the Shares which, from time to time, have not yet been
released from the Company’s Repurchase Option are referred to herein as “Unreleased Shares.”
3.4 Restrictions on Transfer. Unless otherwise permitted by the Administrator
pursuant to the Plan, no Unreleased Shares or any dividends or other distributions thereon or any
interest or right therein or part thereof, shall be liable for the debts, contracts or engagements
of Holder or his or her successors in interest or shall be subject to disposition by transfer,
alienation, anticipation, pledge, encumbrance, assignment or any other means whether such
disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment,
garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted
disposition thereof shall be null and void and of no effect.
ARTICLE IV
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4.1 Escrow of Shares. To insure the availability for delivery of Xxxxxx’s Unreleased
Shares upon repurchase by the Company pursuant to the Repurchase Option under Section 3.1, Holder
hereby appoints the Secretary of the Company, or any other person designated by the Administrator
as escrow agent, as his or her attorney-in-fact to assign and transfer unto the Company, such
Unreleased Shares, if any, repurchased by the Company pursuant to the Repurchase Option pursuant to
Section 3.1 and any dividends or other distributions thereon, and shall, upon execution of this
Agreement, deliver and deposit with the Secretary of the Company, or such other person designated
by the Administrator, any share certificates representing the Unreleased Shares, together with the
stock assignment duly endorsed in blank, attached to the Grant Notice as Exhibit D to the
Grant Notice. The Unreleased Shares and stock assignment shall be held by the Secretary of the
Company, or such other person designated by the Administrator, in escrow, pursuant to the Joint
Escrow Instructions of the Company and Holder attached as Exhibit E to the Grant Notice,
until the Company exercises its Repurchase Option as provided in Section 3.1, until such Unreleased
Shares are released from the Company’s Repurchase Option, or until such time as this Agreement no
longer is in effect. Upon release of the Unreleased Shares, the escrow agent shall deliver to
Holder the certificate or certificates representing such Shares in the escrow agent’s possession
belonging to Holder in accordance with the terms of the Joint Escrow Instructions attached as
Exhibit E to the Grant Notice, and the escrow agent shall be discharged of all further
obligations hereunder; provided, however, that the escrow agent shall nevertheless retain such
certificate or certificates as escrow agent if so required pursuant to other restrictions imposed
pursuant to this Agreement. If the Shares are held in book entry form, then such entry will
reflect that the Shares are subject to the restrictions of this Agreement. If any dividends or
other distributions are paid on the Unreleased Shares held by the escrow agent pursuant to this
Section 4.1 and the Joint Escrow Instructions, such dividends or other distributions shall also be
subject to the restrictions set forth in this Agreement and held in escrow pending release of the
Unreleased Shares with respect to which such dividends or other distributions were paid from the
Company’s Repurchase Option.
4.2 Transfer of Repurchased Shares. Xxxxxx hereby authorizes and directs the
Secretary of the Company, or such other person designated by the Administrator, to transfer the
Unreleased Shares as to which the Repurchase Option has been exercised from Holder to the Company.
4.3 No Liability for Actions in Connection with Escrow. The Company, or its designee,
shall not be liable for any act it may do or omit to do with respect to holding the Shares in
escrow and while acting in good faith and in the exercise of its judgment.
ARTICLE V
5.1 Adjustment for Stock Split. In the event of any stock dividend, stock split,
reverse stock split, recapitalization, combination, reclassification, or similar change in the
capital structure of the Company, the Administrator shall make appropriate and equitable
adjustments in
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
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the Unreleased Shares subject to the Repurchase Option and the number of Shares, consistent
with any adjustment under Section 10.3 of the Plan. The provisions of this Agreement shall apply,
to the full extent set forth herein with respect to the Shares, to any and all shares of capital
stock or other securities which may be issued in respect of, in exchange for, or in substitution of
the Shares, and shall be appropriately adjusted for any stock dividends, splits, reverse splits,
combinations, recapitalizations and the like occurring after the date hereof.
5.2 Taxes. Xxxxxx has reviewed with Xxxxxx’s own tax advisors the federal, state,
local and foreign tax consequences of this investment and the transactions contemplated by the
Grant Notice and this Agreement. Holder is relying solely on such advisors and not on any
statements or representations of the Company or any of its agents. Holder understands that Holder
(and not the Company) shall be responsible for Xxxxxx’s own tax liability that may arise as a
result of this investment or the transactions contemplated by this Agreement. Holder understands
that Holder will recognize ordinary income for federal income tax purposes under Section 83 of the
Code. In this context, “restriction” includes the right of the Company to repurchase the Shares
pursuant to its Repurchase Option set forth in Section 3.1. Holder understands that Holder may
elect to be taxed for federal income tax purposes at the time the Shares are purchased rather than
as and when the Repurchase Option lapses by filing an election under Section 83(b) of the Code with
the Internal Revenue Service within thirty (30) days from the date of purchase. A form of election
under Section 83(b) of the Code is attached to the Grant Notice as Exhibit X.
XXXXXX ACKNOWLEDGES THAT IT IS XXXXXX’S SOLE RESPONSIBILITY AND NOT THE COMPANY’S TO TIMELY
FILE THE ELECTION UNDER SECTION 83(b), EVEN IF HOLDER REQUESTS THE COMPANY OR ITS REPRESENTATIVES
TO MAKE THIS FILING ON HOLDER’S BEHALF
5.3 Limitations Applicable to Section 16 Persons. Notwithstanding any other provision
of the Plan or this Agreement, if Holder is subject to Section 16 of the Exchange Act, the Plan,
the Shares and this Agreement shall be subject to any additional limitations set forth in any
applicable exemptive rule under Section 16 of the Exchange Act (including any amendment to Rule
16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule. To
the extent permitted by applicable law, this Agreement shall be deemed amended to the extent
necessary to conform to such applicable exemptive rule.
5.4 Administration. The Administrator 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 as are consistent therewith and to interpret, amend or revoke any such rules. All actions
taken and all interpretations and determinations made by the Administrator in good faith shall be
final and binding upon Holder, the Company and all other interested persons. No member of the
Administrator shall be personally liable for any action, determination or interpretation made in
good faith with respect to the Plan, this Agreement or the Shares. In its absolute discretion, the
Board may at any time and from time to time exercise any and all rights and duties of the
Administrator under the Plan and this Agreement.
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
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(a) Any share certificate(s) evidencing the Shares issued hereunder shall be endorsed with the
following legend and any other legend required by any applicable federal and state securities laws:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A RIGHT OF REPURCHASE IN
FAVOR OF THE COMPANY AND MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF A
RESTRICTED STOCK AWARD AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF
WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.
(b) Xxxxxx agrees that, in order to ensure compliance with the restrictions referred to
herein, the Company may issue appropriate “stop transfer” instructions to its transfer agent, if
any, and that, if the Company transfers its own securities, it may make appropriate notations to
the same effect in its own records.
(c) The Company shall not be required: (i) to transfer on its books any shares of Common Stock
that have been sold or otherwise transferred in violation of any of the provisions of this
Agreement, or (ii) to treat as owner of such shares of Common Stock 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.
5.6 Notices. Any notice to be given under the terms of this Agreement to the Company
shall be addressed to the Company in care of the Secretary of the Company, and any notice to be
given to Holder shall be addressed to Holder at the address given beneath Xxxxxx’s signature on the
Grant Notice. By a notice given pursuant to this Section 5.6, either party may hereafter designate
a different address for notices to be given to that party. Any notice shall be deemed duly given
when sent via email or when sent by certified mail (return receipt requested) and deposited (with
postage prepaid) in a post office or branch post office regularly maintained by the United States
Postal Service.
5.7 Titles. Titles are provided herein for convenience only and are not to serve as a
basis for interpretation or construction of this Agreement.
5.8 Governing Law; Severability. This Agreement shall be administered, interpreted
and enforced under the laws of the State of Delaware without regard to conflicts of laws thereof.
Should any provision of this Agreement be determined by a court of law to be illegal or
unenforceable, the other provisions shall nevertheless remain effective and shall remain
enforceable.
5.9 Conformity to Securities Laws. Holder acknowledges that the Plan is intended to
conform to the extent necessary with all provisions of the Securities Act and the Exchange Act and
any and all regulations and rules promulgated by the Securities and Exchange Commission
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
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thereunder, and state securities laws and regulations. Notwithstanding anything herein to the
contrary, the Plan shall be administered, and the Shares are to be issued, only in such a manner as
to conform to such laws, rules and regulations. To the extent permitted by applicable law, the
Plan and this Agreement shall be deemed amended to the extent necessary to conform to such laws,
rules and regulations.
5.10 Amendments. This Agreement may not be modified, amended or terminated except by
an instrument in writing, signed by Xxxxxx and by a duly authorized representative of the Company.
5.11 No Employment Rights. If Holder is an Employee, nothing in the Plan or this
Agreement shall confer upon Holder any right to continue in the employ of the Company or any
Subsidiary or shall interfere with or restrict in any way the rights of the Company and its
Subsidiaries, which are expressly reserved, to discharge Holder at any time for any reason
whatsoever, with or without cause, except to the extent expressly provided otherwise in a written
agreement between the Company and Holder.
5.12 Successors and Assigns. The Company may assign any of its rights under this
Agreement 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 Agreement shall be binding upon Xxxxxx and his or her heirs, executors, administrators,
successors and assigns.
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EXHIBIT B
TO RESTRICTED STOCK AWARD GRANT NOTICE
VESTING PROVISIONS
Capitalized terms used in this Exhibit B and not defined below shall have the meanings
given them in the Agreement to which this Exhibit B is attached.
(a) Fiscal Year 2006. If the Company’s EBITDA and Net Adds for Fiscal Year 2006 equal
or exceed the EBITDA and Net Add Achievement Thresholds (as set forth below), then a number of the
Unreleased Shares shall be released from the Company’s Repurchase Option on the applicable
Performance Vesting Effective Date equal to the number obtained by multiplying the percentage
determined in accordance with the following table, by the total number of shares of Restricted
Stock subject to the Award (as shown in the Grant Notice).
| 2006 Net Adds | ||||||||||||||||
| Threshold | Target | Maximum | ||||||||||||||
2006
EBITDA (in thousands) |
[***] | [***] | [***] | |||||||||||||
| Threshold | 10 | % | 12.5 | % | 15 | % | ||||||||||
| [***] | ||||||||||||||||
Target |
12.5 | % | 20 | % | 22.5 | % | ||||||||||
[***] |
||||||||||||||||
Maximum |
15 | % | 22.5 | % | 30 | % | ||||||||||
[***] |
||||||||||||||||
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
B-1
The percentage of Unreleased Shares which shall be released from the Company’s Repurchase
Option if performance is between the Achievement Threshold amount and the Achievement Target
amount, or between the Achievement Target amount and the Achievement Maximum amount shall be
determined by linear interpolation between the applicable Achievement amounts for each measure in
accordance with the method described in Attachment B-1.
(b) Fiscal Year 2007. If the Company’s EBITDA and Net Adds for Fiscal Year 2007 equal
or exceed the EBITDA and Net Adds Achievement Thresholds (as set forth below), then a number of the
Unreleased Shares shall be released from the Company’s Repurchase Option on the applicable
Performance Vesting Effective Date equal to the number obtained by multiplying the percentage
determined in accordance with the following table, by the total number of shares of Restricted
Stock subject to the Award (as shown in the Grant Notice).
| 2007 Net Adds | ||||||||||||||||
| Threshold | Target | Maximum | ||||||||||||||
| 2007 EBITDA (in thousands) | [***] | [***] | [***] | |||||||||||||
| Threshold | 10 | % | 12.5 | % | 15 | % | ||||||||||
| [***] | ||||||||||||||||
| Target | 12.5 | % | 20 | % | 22.5 | % | ||||||||||
| [***] | ||||||||||||||||
| Maximum | 15 | % | 22.5 | % | 30 | % | ||||||||||
| [***] | ||||||||||||||||
The percentage of Unreleased Shares which shall be released from the Company’s Repurchase Option if
performance is between the Achievement Threshold amount and the Achievement Target amount, or
between the Achievement Target amount and the Achievement Maximum amount shall be determined by
linear interpolation between the applicable Achievement amounts for each measure in accordance with
the method described in Attachment B-1.
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
B-2
(c) Fiscal Year 2008. If the Company’s EBITDA and Net Adds for Fiscal Year 2008 equal
or exceed the EBITDA and Net Adds Achievement Thresholds (as set forth below), then a number of the
Unreleased Shares shall be released from the Company’s Repurchase Option on the applicable
Performance Vesting Effective Date equal to the number obtained by multiplying the percentage
determined in accordance with the following table, by the total number of shares of Restricted
Stock subject to the Award (as shown in the Grant Notice).
| 2008 Net Adds | ||||||||
| Threshold | Target | Maximum | ||||||
| 2008 EBITDA (in thousands) | [***] | [***] | [***] | |||||
| Threshold | 10% | 12.5% | 15% | |||||
| [***] | ||||||||
| Target | 12.5% | 20% | 22.5% | |||||
| [***] | ||||||||
| Maximum | 15% | 22.5% | 30% | |||||
| [***] | ||||||||
The percentage of Unreleased Shares which shall be released from the Company’s Repurchase Option if
performance is between the Achievement Threshold amount and the Achievement Target amount, or
between the Achievement Target amount and the Achievement Maximum amount shall be determined by
linear interpolation between the applicable Achievement amounts for each measure in accordance with
the method described in Attachment B-1.
(d) Definition of EBITDA. For purposes of this Exhibit B, the term “EBITDA”
for a Fiscal Year means the Company’s consolidated net income or loss for such period before
extraordinary items and before the cumulative effect of any change in accounting principles plus
(a) the following to the extent deducted in calculating such consolidated net income or loss: (i)
consolidated interest expense, (ii) all income tax expense deducted in arriving at such
consolidated net income or loss, (iii) depreciation and amortization expense, (iv) non-cash
impairment of assets (tangible and intangible) and related non-cash charges, (v) charges and
expenses related to stock based compensation awards, (vi) net non-cash reorganization expenses and
charges, (vii) non-cash dividends or other distributions made with respect to qualified preferred
stock as contemplated by the Credit Agreement negotiated among the Company, Cricket Communications
Inc., the administrative agent identified therein and others posted to IntraLinks on December 23,
2004 and (viii) other non-recurring expenses reducing such consolidated net income or loss which do
not represent a cash item in such period or any future period (including losses attributable to the
sale of assets other than in the ordinary course of business) and minus (b) the following to the
extent included in calculating such consolidated net income or loss: (i) income tax credits for
such period, (ii) all gains arising in relation to the sale
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
B-3
of assets other than in the ordinary course of business and (iii) all non-cash items
increasing such consolidated net income or loss for such period.
(e) Definition of Net Adds. For purposes of this Exhibit B, the term “Net
Adds” means, with respect to any Fiscal Year, “end of period customers” on the last day of such
Fiscal Year less “end of period customers” on the last day of the preceding Fiscal Year. If the
Company adopts a pre-paid card based service offering, the Administrator shall, in its discretion,
equitably adjust the Net Adds Achievement Levels set forth in paragraphs (a), (b) and (c) to
reflect the Company’s changed scope of operations.
(f) Adjustments for Future Changes in the Company’s Business. The EBITDA Achievement
Levels and Net Adds Achievement Levels set forth in paragraphs (a), (b) and (c) were designed to be
measured against the Company’s performance in the thirty-nine (39) markets in which it was
operating as of March 1, 2005. If the Company commences operations in any new markets, or ceases
to operate in any existing market, the Administrator shall, in its discretion, equitably adjust the
EBITDA Achievement Levels and/or the Net Adds Achievement Levels to reflect the Company’s changed
scope of operations.
(g) Release of Shares Cumulative; Continued Service Condition. The release of
Unreleased Shares from the Company’s Repurchase Option under paragraphs (a), (b) and (c) shall be
cumulative. Unreleased Shares shall only be released from the Company’s Repurchase Option pursuant
to this paragraph 2 if Holder is an Employee, Director or Consultant of the Company or any of its
Subsidiaries on the applicable Performance Vesting Effective Date.
(h) Definition of Fiscal Year. For purposes of this Exhibit B, the term
“Fiscal Year” means the Company’s fiscal year ending December 31.
(i) Definition of Performance Vesting Effective Date. For purposes of this
Exhibit B, the term “Performance Vesting Effective Date” means, with respect to the release
from the Company’s Repurchase Option of Unreleased Shares to occur upon the attainment of EBITDA
and Net Adds Achievement Levels for 2006, 2007 or 2008, as applicable, the date of the public
announcement by the Company of EBITDA or Net Adds, as applicable, for the relevant Fiscal Year, but
in no event shall the Company make such public announcement later than the date on which the
Company files its Form 10-K for the relevant Fiscal Year.
(j) Termination of Performance-Based Vesting. Notwithstanding the foregoing
provisions of this paragraph 2, no Unreleased Shares shall be released from the Company’s
Repurchase Option under this paragraph 2 on or after the date of occurrence of a Change in Control.
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
B-4
(b) Change in Control. In the event of a Change in Control, (i) if Holder is an
Employee, Director or Consultant immediately prior to such Change in Control, then one-third of the
number of Unreleased Shares immediately prior to such Change in Control shall be released from the
Company’s Repurchase Option, and (ii) if Holder is an Employee, Director or Consultant on the first
anniversary of the date of the occurrence of such Change in Control, then an additional one-third
of the number of Unreleased Shares immediately prior to such Change in Control shall be released
from the Company’s Repurchase Option, and (iii) if the Holder is an Employee, Director or
Consultant on the second anniversary of the date of the occurrence of such Change in Control, then
any remaining Unreleased Shares shall be released from the Company’s Repurchase Option.
(c) Termination of Employment in the Event of a Change in Control. In the event of a
Change in Control, if Holder has a Termination of Employment by reason of discharge by the Company
other than for Cause (as defined below), or by reason of resignation by Holder for Good Reason (as
defined below), during the period commencing ninety (90) days prior to such Change in Control and
ending twelve (12) months after such Change in Control, then (i) if the Change in Control occurs
prior to January 1, 2006, twenty-five percent (25%) of the Unreleased Shares shall be released form
the Company’s Repurchase Option and (ii) if the Change in Control occurs on or after January 1,
2006, the remaining Unreleased Shares shall be released from the Company’s Repurchase Option, in
each case, on the date of Holder’s Termination of Employment (or, if later, immediately prior to
the date of the occurrence of such Change in Control).
(c) Definitions of Cause and Good Reason. For purposes of this Exhibit B,
the terms “Cause” and “Good Reason” shall have the meanings given to such terms in the Holder’s
employment agreement with the Company in effect on the Grant Date and if the Holder does not have
an employment agreement or Holder’s employment agreement does not include definitions of “Cause”
and “Good Reason”, the terms shall be defined for purposes of this Exhibit B as follows:
(i) “Cause” shall mean termination of Holder’s employment by the Company (or the
Parent, any Subsidiary or any successor thereof): (A) upon Holder’s willful failure
substantially to perform Holder’s duties with the Company (or the Parent, any Subsidiary or
any successor thereof) (other than any such failure resulting from Xxxxxx’s incapacity due
to physical or mental illness or any such actual or anticipated failure after Holder’s
issuance of a Notice of Termination (as described below) for Good Reason), as reasonably
determined by the Company, or, if Xxxxxx is then employed in a position as Senior Vice
President of the Company or a more senior officer of the Company, by the Board of Directors
of the Company after a written demand for substantial performance is delivered to Holder by
the Company, or the Board of Directors
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
B-5
of the Company, as the case may be, which demand specifically identifies the manner in
which the Company or the Board of Directors of the Company, as the case may be, believes
that Xxxxxx has not substantially performed such duties, provided that Holder shall have
been given a reasonable period, not to exceed fifteen (15) days, in which to cure such
failure (provided such failure is capable of being cured), (B) upon Holder’s willful failure
substantially to follow and comply with the specific and lawful directives of the Company
or, if Xxxxxx is then employed in a position as a Senior Vice President of the Company or a
more senior officer of the Company, by the Board of Directors of the Company (or the Board
of Directors of the Parent) or duly adopted policies of the Company which are consistent
with Holder’s duties with the Company (or the Parent, any Subsidiary or any successor
thereof), as reasonably determined by the Company or, if Xxxxxx is then employed in a
position as a Senior Vice President of the Company or a more senior officer of the Company,
by the Board of Directors of the Company (other than any such failure resulting from
Xxxxxx’s incapacity due to physical or mental illness or any such actual or anticipated
failure after Xxxxxx’s issuance of a Notice of Termination for Good Reason), after a written
demand for substantial performance is delivered to Holder by the Company or the Board of
Directors of the Company, as the case may be, which demand specifically identifies the
manner in which the Company or the Board of Directors of the Company, as the case may be,
believes that Xxxxxx has not substantially performed such directives, provided that the
Holder shall have been given a reasonable period not to exceed fifteen (15) days in which to
cure such failure (provided such failure is capable of being cured), (C) upon Holder’s
commission of an act of fraud or dishonesty impacting or involving the Company (or the
Parent, any Subsidiary or any successor thereof), (D) upon Xxxxxx’s willful engagement in
illegal conduct or gross misconduct affecting the Company, or (E) upon the Holder’s being
convicted of, or pleading nolo contendere to, the commission of a felony.
(ii) “Good Reason” shall mean, without Xxxxxx’s express written consent, the occurrence
of any of the following circumstances unless such circumstances are cured (provided such
circumstances are capable of being cured) prior to the Date of Termination specified in a
Notice of Termination given in respect thereof: (A) the continuous assignment to Holder of
any duties materially inconsistent with Xxxxxx’s positions with the Company (or the Parent,
any Subsidiary or any successor thereof), a significant adverse alteration in the nature or
status of Holder’s responsibilities or the conditions of Holder’s employment with the
Company (or the Parent, any Subsidiary or any successor thereof), or any other action that
results in a material diminution in Holder’s position, authority, title, duties or
responsibilities with the Company (or the Parent, any Subsidiary or any successor thereof);
(B) reduction of Holder’s annual base salary as in effect on the Grant Date or as the same
may be increased from time to time thereafter; (C) the relocation of the Company’s offices
at which Holder is principally employed to a location more than sixty (60) miles from such
location; (D) the Company’s failure (or the failure of the Parent, any Subsidiary or any
successor) to pay Holder any portion of Holder’s current compensation; (E) the Company’s
failure (or the failure of the Parent, any Subsidiary or any successor) to continue in
effect any material compensation
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
B-6
or benefit plan in which Holder participates, unless an equitable arrangement (embodied
in an ongoing substitute or alternative plan) has been made with respect to such plan, or
the Company’s failure to continue Holder’s participation therein (or in such substitute or
alternative plan) on the basis not materially less favorable, both in terms of the amount of
benefits provided and the level of Holder’s participation relative to other participants;
(F) the Company’s failure (or the failure of the Parent, any Subsidiary or any successor) to
continue to provide Holder with benefits substantially similar in the aggregate to those
enjoyed by Holder under any of the Company’s life insurance, medical, health and accident,
disability, pension, retirement, or other benefit plans in which Holder or Xxxxxx’s eligible
family members were participating immediately prior thereto, or the taking of any action by
the Company (or the Parent, any Subsidiary or any successor thereof) which would directly or
indirectly materially reduce any of such benefits; or (G) the continuation or repetition,
after written notice of objection from Holder, of harassing or denigrating treatment of
Holder by the Company, the Parent, any Subsidiary or any successor thereof inconsistent with
Xxxxxx’s position with the Company. Xxxxxx’s right to terminate employment with the Company
or the Parent, Subsidiary or any successor thereof pursuant to this subparagraph shall not
be affected by Xxxxxx’s incapacity due to physical or mental illness. Xxxxxx’s continued
employment with the Company or the Parent, Subsidiary or any successor thereof shall not
constitute consent to, or a waiver of rights with respect to, any circumstance constituting
Good Reason thereunder.
(d) Condition to Release of Shares. The release of Unreleased Shares from the
Company’s Repurchase Option pursuant to subparagraph 3(b) shall be conditioned on the Holder’s
delivery to the Company of an executed General Release and the Holder’s non-revocation of such
General Release during the time period for such revocation set forth therein.
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
B-7
Attachment B-1
Methodology for Linear Interpolation
| 2005 Net Adds | ||||||||
| Threshold | Target | Maximum | ||||||
| 2005 EBITDA (in thousands) | [***] | [***] | [***] | |||||
| Threshold | 10% | 12.5% | 15% | |||||
| [***] | ||||||||
| Target | 12.5% | 20% | 22.5% | |||||
| [***] | ||||||||
| Maximum | 15% | 22.5% | 30% | |||||
| [***] | ||||||||
The EBITDA amounts in the following examples are shown in thousands.
Example 1:
| • | 2005 EBITDA: [***] |
| • | 2005 Net Adds: [***] |
Problem: The net adds performance falls exactly on a specified payout range, but performance
in EBITDA falls somewhere in-between the schedule.
Solution: Start with the net adds payout column and use straight-line interpolation to
determine the final payout.
Payout Calculation: Net additions of [***] dictate a payout of 12.5% for threshold EBITDA
performance and 20% for target EBITDA performance. Since EBITDA performance ([***]) is halfway
between threshold and target performance ([***] and [***]), the actual payout should be halfway
between the scheduled payouts of 12.5% and 20%. Thus the payout is (1/2)*(20%-12.5%)+12.5%
| • | Payout = 16.25% |
Example 2:
| • | 2005 EBITDA: [***] |
| • | 2005 Net Adds: [***] |
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
B-1-1
Problem: Neither the net adds performance nor the EBITDA performance fall exactly on a
specified payout.
Payout Calculation: EBITDA performance ([***]) is halfway between threshold and target
performance ([***] and [***]), so we can interpolate an EBITDA-based payout schedule by finding the
halfway point at each defined level of Net Adds. At [***]
net adds, the EBITDA-based payout would
be halfway between 10% and 12.5%. At [***] net adds, the EBITDA-based payout would be halfway
between 12.5% and 20%. At [***] net adds, the EBITDA-based payout would be halfway between 15% and
22.5%. Thus the interpolated, EBITDA-based payout schedule looks like this:
| 2005 Net Adds | ||||||||
| Threshold | Target | Maximum | ||||||
| 2005 EBITDA | [***] | [***] | [***] | |||||
| Actual | 11.25% | 16.25% | 18.75% | |||||
| [***] | (midpoint of | (midpoint of | (midpoint of | |||||
| (midpoint of [***] and [***]) | 10% and 12.5%) | 12.5% and 20%) | 15% and 22.5%) | |||||
To determine the actual payout given this range, we interpolate a payout at [***] net adds
based on the scheduled payouts at [***] and [***]. First we determine where [***] lies in the
range of [***] to [***]. The length of the range is [***] – [***] = [***] net adds. [***] is
[***] above the range minimum ([***] – [***] = [***]). So the actual performance of [***] net adds
falls 1/3 of the way between [***] net adds (target) and [***] net adds (maximum). This means
the actual payout must fall 1/3 of the way between 16.25% and 18.75%. Thus the payout is
(1/3)*(18.75%-16.25%)+16.25%
| • | Payout = 17.08% |
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
B-1-2
EXHIBIT C
TO RESTRICTED STOCK AWARD GRANT NOTICE
CONSENT OF SPOUSE
I, , spouse of , have read and approve the foregoing Agreement. In
consideration of issuing to my spouse the shares of the common stock of Leap Wireless
International, Inc. set forth in the Agreement, I hereby appoint my spouse as my attorney-in-fact
in respect to the exercise of any rights under the Agreement and agree to be bound by the
provisions of the Agreement insofar as I may have any rights in said Agreement or any shares of the
common stock of Leap Wireless International, Inc. issued pursuant thereto under the community
property laws or similar laws relating to marital property in effect in the state of our residence
as of the date of the signing of the foregoing Agreement.
Dated: , |
||
| Signature of Spouse |
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
C-1
EXHIBIT D
TO RESTRICTED STOCK AWARD GRANT NOTICE
STOCK ASSIGNMENT
FOR VALUE RECEIVED, the undersigned, , hereby sells, assigns and transfers unto LEAP WIRELESS
INTERNATIONAL, INC., a Delaware corporation, shares of the Common Stock of LEAP WIRELESS
INTERNATIONAL, INC., a Delaware corporation, standing in its name of the books of said corporation
represented by Certificate No. herewith and do hereby irrevocably constitute and appoint
to transfer the said stock on the books of the within named corporation with
full power of substitution in the premises.
This Stock Assignment may be used only in accordance with the Restricted Stock Award Agreement
between LEAP WIRELESS INTERNATIONAL, INC. and the undersigned dated , .
Dated: , |
||
| [Name of Xxxxxx] |
INSTRUCTIONS: Please do not fill in the blanks other than the signature line. The purpose of
this assignment is to enable the Company to exercise its “Repurchase Option,” as set forth in the
Restricted Stock Award Agreement, without requiring additional signatures on the part of Holder.
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
D-1
EXHIBIT E
TO RESTRICTED STOCK AWARD GRANT NOTICE
JOINT ESCROW INSTRUCTIONS
,
Secretary
Leap Wireless International, Inc.
00000 Xxxxxxx Xxxxxx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Leap Wireless International, Inc.
00000 Xxxxxxx Xxxxxx Xxxxx
Xxx Xxxxx, Xxxxxxxxxx 00000
Ladies and Gentlemen:
As escrow agent (the “Escrow Agent”) for both Leap Wireless International, Inc., a Delaware
corporation (the “Company”), and the undersigned recipient of stock of the Company (the “Holder”),
you are hereby authorized and directed to hold in escrow the documents delivered to you pursuant to
the terms of that certain Restricted Stock Award Agreement (“Agreement”) between the Company and
the undersigned (the “Escrow”), including the stock certificate and the Assignment in Blank, in
accordance with the following instructions:
1. In the event the Company and/or any assignee of the Company (referred to collectively for
convenience herein as the “Company”) exercises the Company’s Repurchase Option as defined in the
Agreement), the Company shall give to the Holder and you a written notice specifying the number of
shares of stock to be purchased, the purchase price and the time for a closing hereunder at the
principal office of the Company. The Holder and the Company hereby irrevocably authorize and
direct you to close the transaction contemplated by such notice in accordance with the terms of
said notice.
2. As of the date of closing of the repurchase indicated in such notice, you are directed (a)
to date the stock assignments necessary for the repurchase and transfer in question, (b) to fill in
the number of shares being repurchased and transferred, and (c) to deliver the same, together with
the certificate evidencing the shares of stock to be repurchased and transferred, to the Company or
its assignee.
3. Holder irrevocably authorizes the Company to deposit with you any certificates evidencing
shares of stock to be held by you hereunder and any additions and substitutions to said shares as
defined in the Agreement. Xxxxxx does hereby irrevocably constitute and appoint you as Xxxxxx’s
attorney-in-fact and agent for the term of this escrow to execute with respect to such securities
all documents necessary or appropriate to make such securities negotiable and to complete any
transaction herein contemplated, including but not limited to the filing with any applicable state
blue sky authority of any required applications for consent to, or notice of transfer of, the
securities. Subject to the provisions of this paragraph and the Agreement, Holder shall exercise
all rights and privileges of a stockholder of the Company while the stock is held by you.
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
E-1
4. Upon written request of Xxxxxx, but no more than once per calendar month, unless the
Company’s Repurchase Option has been exercised, you will deliver to Holder a certificate or
certificates representing so many shares of stock as are not then subject to the Repurchase Option.
Within one hundred fifty (150) days after any voluntary or involuntary termination of Holder’s
services to the Company for any or no reason, you will deliver to Holder a certificate or
certificates representing the aggregate number of shares held or issued pursuant to the Agreement
and not repurchased pursuant to the Repurchase Option set forth in Section 3.1 of the Agreement.
5. If at the time of termination of this escrow you should have in your possession any
documents, securities, or other property belonging to Xxxxxx, you shall deliver all of the same to
the Holder and shall be discharged of all further obligations hereunder.
6. Your duties hereunder may be altered, amended, modified or revoked only by a writing signed
by all of the parties hereto.
7. You shall be obligated only for the performance of such duties as are specifically set
forth herein and may rely and shall be protected in relying or refraining from acting on any
instrument reasonably believed by you to be genuine and to have been signed or presented by the
proper party or parties. You shall not be personally liable for any act you may do or omit to do
hereunder as Escrow Agent or as attorney-in-fact for Holder while acting in good faith, and any act
done or omitted by you pursuant to the advice of your own attorneys shall be conclusive evidence of
such good faith.
8. You are hereby expressly authorized to disregard any and all warnings given by any of the
parties hereto or by any other person or corporation, excepting only orders or process of courts of
law and are hereby expressly authorized to comply with and obey orders, judgments or decrees of any
court. In case you obey or comply with any such order, judgment or decree, you shall not be liable
to any of the parties hereto or to any other person, firm or corporation by reason of such
compliance, notwithstanding any such order, judgment or decree being subsequently reversed,
modified, annulled, set aside, vacated or found to have been entered without jurisdiction.
9. You shall not be liable in any respect on account of the identity, authorities or rights of
the parties executing or delivering or purporting to execute or deliver the Agreement or any
documents or papers deposited or called for hereunder.
10. You shall not be liable for the expiration of any rights under any applicable state,
federal or local statute of limitations or similar statute or regulation with respect to these
Joint Escrow Instructions or any documents deposited with you.
11. You shall be entitled to employ such legal counsel and other experts as you may deem
necessary properly to advise you in connection with your obligations hereunder, may rely
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
E-2
upon the advice of such counsel, and may pay such counsel reasonable compensation therefor.
The Company will reimburse you for any reasonable attorneys’ fees with respect thereto.
12. Your responsibilities as Escrow Agent hereunder shall terminate if you shall cease to be
an officer or agent of the Company or if you shall resign by written notice to each party. In the
event of any such termination, the Company shall appoint a successor Xxxxxx Agent.
13. If you reasonably require other or further instruments in connection with these Joint
Escrow Instructions or obligations in respect hereto, the necessary parties hereto shall join in
furnishing such instruments.
14. It is understood and agreed that should any dispute arise with respect to the delivery
and/or ownership or right of possession of the securities held by you hereunder, you are authorized
and directed to retain in your possession without liability to anyone all or any part of said
securities until such disputes shall have been settled either by mutual written agreement of the
parties concerned or by a final order, decree or judgment of a court of competent jurisdiction
after the time for appeal has expired and no appeal has been perfected, but you shall be under no
duty whatsoever to institute or defend any such proceedings.
15. Any notice to be given under the terms of this Agreement to the Company shall be addressed
to the Company in care of the Secretary of the Company, and any notice to be given to the Holder or
you shall be addressed to the address given beneath Xxxxxx’s and your signatures on the signature
page to this Agreement. By a notice given pursuant to this Section 15, any party may hereafter
designate a different address for notices to be given to that party. Any notice, which is required
to be given to Holder, shall, if the Holder is then deceased, be given to Xxxxxx’s designated
beneficiary, if any by written notice under this Section 15. Any notice shall be deemed duly given
when sent via email or when sent by certified mail (return receipt requested) and deposited (with
postage prepaid) in a post office or branch post office regularly obtained by the United States
Postal Service.
16. By signing these Joint Escrow Instructions, you become a party hereto only for the purpose
of said Joint Escrow Instructions; you do not become a party to the Agreement.
17. This instrument shall be binding upon and inure to the benefit of the parties hereto, and
their respective successors and permitted assigns.
18. These Joint Escrow Instructions shall be governed by, and construed and enforced in
accordance with, the laws of the State of Delaware, without regard to conflicts of law thereof.
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
(Signature Page Follows)
E-3
| Very truly yours, | ||||||
| LEAP WIRELESS INTERNATIONAL, INC. | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
| Address: | 00000 Xxxxxxx Xxxxxx Xxxxx | |||||
| San Diego, California 92121 | ||||||
| HOLDER: | ||||||
| Address: | ||||||
| ESCROW AGENT: | ||||||
By: |
||||||
| Secretary, Leap Wireless International, Inc. | ||||||
| Address: | 00000 Xxxxxxx Xxxxxx Xxxxx | |||||
| San Diego, California 92121 | ||||||
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
E-4
EXHIBIT F
TO RESTRICTED STOCK AWARD GRANT NOTICE
FORM OF 83(B) ELECTION AND INSTRUCTIONS
These instructions are provided to assist you if you choose to make an election under Section
83(b) of the Internal Revenue Code, as amended, with respect to the shares of common stock, par
value $0.0001, of Leap Wireless International, Inc. transferred to you. Please consult with your
personal tax advisor as to whether an election of this nature will be in your best interests in
light of your personal tax situation.
The executed original of the Section 83(b) election must be filed with the Internal Revenue
Service not later than 30 days after the date the shares were transferred to you. PLEASE NOTE:
There is no remedy for failure to file on time. The steps outlined below should be followed to
ensure the election is mailed and filed correctly and in a timely manner. ALSO, PLEASE NOTE: If
you make the Section 83(b) election, the election is irrevocable.
| 1. | Complete Section 83(b) election form (attached as Attachment 1) and make four (4) copies of the signed election form. (Your spouse, if any, should sign Section 83(b) election form as well.) |
| 2. | Prepare the cover letter to the Internal Revenue Service (sample letter attached as Attachment 2). |
| 3. | Send the cover letter with the originally executed Section 83(b) election form and one (1) copy via certified mail, return receipt requested to the Internal Revenue Service at the address of the Internal Revenue Service where you file your personal tax returns. We suggest that you have the package date-stamped at the post office. The post office will provide you with a white certified receipt that includes a dated postmark. Enclose a self-addressed, stamped envelope so that the Internal Revenue Service may return a date-stamped copy to you. However, your postmarked receipt is your proof of having timely filed the Section 83(b) election if you do not receive confirmation from the Internal Revenue Service. |
| 4. | One (1) copy must be sent to Leap Wireless International, Inc. for its records and one (1) copy must be attached to your federal income tax return for the applicable calendar year. |
| 5. | Retain the Internal Revenue Service file stamped copy (when returned) for your records. |
Please consult your personal tax advisor for the address of the office of the Internal Revenue
Service to which you should mail your election form.
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
F-1
ATTACHMENT 1 TO EXHIBIT F
ELECTION UNDER INTERNAL REVENUE CODE SECTION 83(B)
The undersigned taxpayer hereby elects, pursuant to Section 83(b) of the Internal Revenue Code
of 1986, as amended, to include in taxpayer’s gross income for the current taxable year the amount
of any compensation taxable to taxpayer in connection with taxpayer’s receipt of shares (the
“Shares”) of Common Stock, par value $0.0001 per share, of Leap Wireless International, Inc., a
Delaware corporation (the “Company”).
| 1. | The name, address and taxpayer identification number of the undersigned taxpayer are: SSN: The name, address and taxpayer identification number of the Taxpayer’s spouse are (complete if applicable): |
|
| SSN: |
| 2. | Description of the property with respect to which the election is being made: | |
| (___) shares of Common Stock, par value $0.0001 per share, of the Company. |
| 3. | The date on which the property was transferred was . The taxable year to which this election relates is calendar year 200_. |
| 4. | Nature of restrictions to which the property is subject: | |
| The Shares are subject to repurchase at their original purchase price if unvested as of the date of termination of employment, directorship or consultancy with the Company. |
| 5. | The fair market value at the time of transfer (determined without regard to any lapse restrictions, as defined in Treasury Regulation Section 1.83-3(a)) of the Shares was $ per Share. |
| 6. | The amount paid by the taxpayer for Shares was per share. |
| 7. | A copy of this statement has been furnished to the Company. |
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
F-1-1
Dated: , 200_
|
Taxpayer Signature |
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
E-2
The undersigned spouse of Xxxxxxxx joins in this election. (Complete if applicable).
Dated: , 200_
|
Spouse’s Signature |
| Signature(s) Notarized by: | ||||
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |
F-1-3
ATTACHMENT 2 TO EXHIBIT F
SAMPLE COVER LETTER TO INTERNAL REVENUE SERVICE
, 200_
VIA CERTIFIED MAIL
RETURN RECEIPT REQUESTED
RETURN RECEIPT REQUESTED
Internal
Revenue Service
[Address where taxpayer files returns]
[Address where taxpayer files returns]
| Re: | Election under Section 83(b) of the Internal Revenue Code of 1986 | |||||||||||
| Taxpayer: | ||||||||||||
| Taxpayer’s Social Security Number: | ||||||||||||
| Taxpayer’s Spouse: | ||||||||||||
| Taxpayer’s Spouse’s Social Security Number: | ||||||||||||
Ladies and Gentlemen:
Enclosed please find an original and one copy of an Election under Section 83(b) of the
Internal Revenue Code of 1986, as amended, being made by the taxpayer referenced above. Please
acknowledge receipt of the enclosed materials by stamping the enclosed copy of the Election and
returning it to me in the self-addressed stamped envelope provided herewith.
| Very truly yours, | ||
Enclosures
| cc: Leap Wireless International, Inc. |
| [*] | CERTAIN MATERIAL (INDICATED BY AN ASTERISK) HAS BEEN OMITTED FROM THIS DOCUMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. |