NONTRANSFERABLE NON-INCENTIVE
STOCK OPTION AGREEMENT
CLIFF VESTING OPTION
THIS AGREEMENT (the "Agreement"), is dated as of [___________,____], by and
between OSTEOTECH, INC., a Delaware corporation (the "Company"), and
[______________] (the "Optionee"), pursuant to the Company's 2000 Stock Plan
(the "Plan").
For good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the Company and Optionee hereby agree as follows:
1. Grant of Option.
The Company hereby grants to Optionee, effective as of the date set forth
above (the "Grant Date"), the right and option (hereinafter called the "Option")
to purchase up to an aggregate of [_______] shares of common stock, par value
$0.01 per share (the "Common Stock"), of the Company at a price of $[_______]
per share, upon the terms and conditions set forth in this Agreement and in the
Plan. This Option is not intended to be an incentive stock option within the
meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code"). The Option shall terminate at the close of business ten (10) years from
the Grant Date, or such shorter period as is prescribed herein. Optionee shall
not have any of the rights of a stockholder with respect to the shares subject
to the Option until such shares shall be issued to Optionee upon the proper
exercise of the Option.
2. Duration and Exercisability.
(a) Except as otherwise provided in Section 2(b) hereof and subject to the
terms and conditions set forth herein, this Option shall become exercisable by
the Optionee for all of the shares of Common Stock issuable hereunder on the
third anniversary of the Grant Date. The Optionee must be employed by the
Company on such third anniversary date in order for this option to become
exercisable.
(b) Notwithstanding the provisions of Section 2(a) hereof, this Option
shall become exercisable upon the satisfaction of the accelerated vesting
conditions set forth in Exhibit A hereto (the "Accelerated Vesting Conditions"),
provided that Optionee is employed by the Company at the time the Accelerated
Vesting Conditions are satisfied.
(c) During the lifetime of Optionee, the Option shall be exercisable only
by Optionee and shall not be assignable or transferable by Optionee, other than
as provided for in accordance with the provisions of Section 4(c) of this
Agreement.
3. Adjustment of Shares.
(a) The exercise price and the number of shares purchasable upon exercise
of the Options may be adjusted by the Compensation Committee (the "Compensation
Committee") of the Board of Directors of the Company (the "Board") in accordance
with Section 4(c) of the Plan upon the occurrence of certain corporate actions
that may affect the Common Stock.
(b) In the event of a dissolution or liquidation of the Company the Option
shall terminate, provided that, if a period of one (1) year from the Grant Date
shall have elapsed, the Optionee shall have the right immediately prior to such
dissolution or liquidation to exercise such portion of the Option, in whole or
in part, as determined in the sole discretion of the Board, whether or not the
Optionee's right to exercise the Option has otherwise vested pursuant to the
terms of Section 2 of this Agreement. The Board shall also have the right to
waive such one (1) year period.
(c) Subject to the terms of any Change in Control Agreement (as hereinafter
defined), which shall control to the extent such terms shall conflict with the
terms of this Section 3(c), in the event that the Company is a party to a merger
or consolidation, the Option shall be subject to the agreement of merger or
consolidation. Such agreement, without the Optionee's consent, may provide for:
(i) The continuation of the Option by the Company (if the Company is
the surviving corporation);
(ii) The assumption of the Plan and the Option by the surviving
corporation or its parent;
(iii) The substitution by the surviving corporation or its parent of
options with substantially the same terms for the Option; or
(iv) The cancellation of the Option provided that the Optionee shall
have the right immediately prior to such merger or consolidation to
exercise the Option in whole or in part, whether or not the Optionee's
right to exercise the Option has otherwise accrued pursuant to Section 2 of
this Agreement.
4. Effect of Termination of Employment.
(a) In the event that Optionee shall cease to be employed by the Company or
its subsidiaries, if any, for any reason other than termination for cause (as
defined in Section 4(b) hereof) or Optionee's death or disability (as such term
is defined in Section 4(c) hereof), Optionee shall have the right to exercise
the Option at any time within three (3) months after such termination of
employment to the extent of the full number of shares Optionee was entitled to
purchase under the Option on the date of termination; provided, however, that
this Option shall not be exercisable after the expiration of the term of the
Option if earlier.
(b) In the event that Optionee shall cease to be employed by the Company or
its subsidiaries, if any, upon termination for cause, the Option shall be
terminated as of the date of the act giving rise to such termination.
Termination for cause shall mean termination of the Optionee's employment with
the Company for the following acts: dishonesty, fraud, conviction or confession
of a felony or of a crime involving moral turpitude, destruction or theft of the
Company's property, physical attack on a fellow employee, willful malfeasance or
gross negligence, refusal or failure to perform job duties (other than failure
resulting from disability), misconduct materially injurious to the Company,
participation in fraud against the Company, entering into competition against
the Company, and/or a material breach or threatened material breach of any
agreements with the Company.
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(c) If Optionee shall die while this Option is still exercisable according
to its terms, or if Optionee's employment with the Company is terminated because
Optionee has become disabled (within the meaning of Code Section 22(e)(3)) while
in the employ of the Company or a subsidiary, if any, and Optionee shall not
have fully exercised the Option, such Option may be exercised at any time within
twelve (12) months after Optionee's death or date of termination of employment
for disability by Optionee, or personal representatives or administrators, or
guardians of Optionee, as applicable, or by any person or persons to whom the
Option is transferred by will or the applicable laws of descent and
distribution, to the extent of the full number of shares Optionee was entitled
to purchase under the Option on the date of Optionee's death, the date of
termination of Optionee's employment with the Company, if earlier, or the date
of termination of Optionee's employment with the Company for such disability,
and subject in all cases to the condition that no Option shall be exercisable
after the expiration of the term of the Option.
5. Manner of Exercise.
(a) The Option may be exercised only by Optionee or other proper party, as
provided herein, by delivering within the period during which the Option is
exercisable hereunder written notice to the Company at its principal office. The
notice shall state the number of shares as to which the Option is being
exercised and be accompanied by payment in full of the Option price for all
shares designated in the notice.
(b) Optionee may pay the Option price in cash, by check (bank check,
certified check or personal check), by money order, or with the approval of the
Compensation Committee (i) by delivering to the Company for cancellation shares
of Common Stock of the Company with a fair market value as of the date of
exercise equal to the exercise price of the Option or the portion thereof being
paid by tendering such shares or (ii) by delivering to the Company a combination
of cash and Common Stock of the Company with an aggregate fair market value
equal to the exercise price of the Option. For these purposes, the fair market
value of the Company's shares of Common Stock of the Company as of any date
shall be as reasonably determined by the Compensation Committee pursuant to the
Plan.
6. Notices.
All notices or other communications which are required or permitted
hereunder shall be deemed to be sufficient if contained in a written instrument
given by personal delivery, air courier or registered or certified mail, postage
prepaid, return receipt requested, addressed to such party at the address set
forth below or such other address as may thereafter be designated in a written
notice from such party to the other party:
if to the Company, to:
Attention: Chief Financial Officer
Osteotech, Inc.
00 Xxxxx Xxx
Xxxxxxxxx, Xxx Xxxxxx 00000
if to the Optionee, to:
[Optionee's Name]
[Optionee's Address]
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All such notices, advances, and communications shall be deemed to have been
delivered and received (a) in the case of personal delivery, on the date of such
delivery, (b) in the case of air courier, on the business day after the date
when sent and (c) in the case of mailing, on the third business day following
such mailing.
7. Miscellaneous.
(a) This Option is issued pursuant to the Company's 2000 Stock Plan and is
subject to its terms. The terms of the Plan are available for inspection during
business hours at the principal offices of the Company.
(b) This Agreement shall not confer on Optionee any right with respect to
continuance of employment by the Company or any of its subsidiaries, nor will it
interfere in any way with the right of the Company to terminate such employment
at any time. Optionee shall have none of the rights of a stockholder with
respect to shares subject to this Option until such shares shall have been
issued to Optionee upon exercise of this Option.
(c) The exercise of all or any parts of this Option shall only be effective
at such time as the sale of Common Stock pursuant to such exercise will not
violate any state or federal securities or other laws.
(d) The Company shall at all times during the term of the Option reserve
and keep available such number of shares as will be sufficient to satisfy the
requirements of this Agreement.
(e) 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.
(f) The Optionee shall take whatever additional actions and execute
whatever additional documents the Company may in its judgment deem necessary or
advisable in order to carry out or effect one or more of the obligations or
restrictions imposed on the Optionee pursuant to the express provisions of this
Agreement.
(g) This Agreement shall be governed by and construed in accordance with,
the laws of the State of Delaware.
(h) This Agreement may be executed in counterparts, each of which shall be
deemed to be an original, but all of which together shall constitute one and the
same instrument.
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(i) This Agreement constitutes the entire agreement between the parties
with respect to the subject matter hereof, merging any and all prior agreements,
provided that any change in control agreement or similar agreement ("Change in
Control Agreement") between the Optionee and the Company which governs the
exercisability of options to purchase the Company's Common Stock held by the
Optionee upon a change in control of the Company (as defined in such Change in
Control Agreement) shall control with regard to the exercisability of this
Option in the event of such a change in control of the Company to the extent the
terms of such Change in Control Agreement conflict with the terms of this
Agreement.
(j) In order to provide the Company with the opportunity to claim the
benefit of any income tax deduction which may be available to it upon the
exercise of the Option and in order to comply with all applicable federal or
state income tax laws or regulations, the Company may take such action as it
deems appropriate to insure that, if necessary, all applicable federal or state
payroll, withholding, income or other taxes are withheld or collected from
Optionee. With the Company's concurrence, Optionee may elect to satisfy his or
her federal and state income tax withholding obligations upon exercise of this
Option by (i) having the Company withhold a portion of the shares of Common
Stock otherwise to be delivered upon exercise of such Option having a fair
market value equal to the amount of federal and state income tax required to be
withheld upon such exercise, in accordance with such rules as the Company may
from time to time establish, or (ii) delivering to the Company shares of its
Common Stock other than the shares issuable upon exercise of such Option with a
fair market value equal to such taxes, in accordance with such rules.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement as of the
date set forth above.
No. of Shares Subject to Option: [__________]
Exercise Price per Share: $[____]
Date of Grant: [__________,_____]
OSTEOTECH, INC.
By:______________________
Name:
Title:
By:__________________________
[Optionee]
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Exhibit A to Nontransferable
Non-Incentive Stock Option Agreement
Cliff Vesting Option dated as of
[_____________,_____] between Osteotech, Inc.
and [____________] (the "Option Agreement")
The Accelerated Vesting Condition referred to in Section 2(b) of the Option
Agreement are as follows:
For the six months ending [_________] Osteotech Inc. and
Subsidiaries' consolidated net revenues must be at least
$[________] and consolidated operating income must be at
least $[__________].
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FIRST AMENDMENT TO NONTRANSFERABLE NON-INCENTIVE STOCK OPTION AGREEMENT
CLIFF VESTING OPTION
This Amendment, dated as of [___________,_____], is made by and between
OSTEOTECH, INC., a Delaware corporation (the "Company"), and [______________]
(the "Optionee"), pursuant to the Company's 2000 Stock Plan.
Recitals
WHEREAS, the Company and the Optionee entered into that certain Nontransferable
Non-Incentive Stock Option Agreement Cliff Vesting Option (the "Original Option
Agreement"), dated as of [___________,_____], pursuant to which the Company
granted Optionee the right and option to purchase the Company's shares of common
stock; and
WHEREAS, the Company and the Optionee desire to amend Section 4 and other
relevant Sections of the Original Option Agreement to extend the exercise period
of the Option in the event of the Optionee's termination of employment.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants set
forth herein, the Company and the Optionee hereby agree to the following:
1. Section 2(c) of the Original Option Agreement is hereby amended and
restated with the following:
"(c) During the lifetime of Optionee, the Option shall be exercisable
only by Optionee and shall not be assignable or transferable by Optionee,
other than as provided for in accordance with provision of Section 4(b) of
this Agreement."
2. Section 4 of the Original Option Agreement is hereby amended and restated
with the following:
"4. Effect of Termination of Employment
(a) In the event that Optionee shall cease to be employed by the
Company or its subsidiaries, if any, for any reason, the Optionee
shall have the right to exercise the Option through the expiration of
the Option Term.
(b) If the Optionee shall die while this Option is still
exercisable according to its terms, or if Optionee's employment with
the Company is terminated because Optionee has become disabled (within
the meaning of Code Section 22(e)(3)) while in the employ of the
Company or its subsidiaries, if any, the Optionee shall not have fully
exercised the Option, such Option may be exercised at any time through
the expiration of the term of the Option, by Optionee, personal
representatives or administrators, or guardians of Optionee, as
applicable, or by any person or persons to whom the Option is
transferred by will or the applicable laws of descent and
distribution."
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3. Except as set forth herein, the Original Option Agreement remains unchanged
and in full force and effect. In case of any conflict between the Original
Option Agreement, as amended, and the 2000 Stock Option Plan, the Original
Option Agreement, as amended, shall control.
IN WITNESS WHEREOF, the Company and the Optionee hereto have caused this
Amendment to be duly executed as of the date first written above.
OSTEOTECH, INC.
By. _____________________ By. _____________________
Name: [Optionee]
Title:
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