OPEN ENERGY CORPORATION STOCK OPTION AGREEMENT
OPEN
ENERGY CORPORATION
2006
EQUITY INCENTIVE PLAN
Unless
otherwise defined herein, capitalized terms shall have the meaning set forth
in
the Open Energy Corporation 2006 Equity Incentive Plan (the
"Plan").
1. NOTICE
OF STOCK OPTION GRANT
You
have
been granted an option to purchase Common Stock, subject to the terms and
conditions of the Plan and this Option Agreement, as follows:
|
Name
of Optionee:
|
|
|
Total Number of Shares Granted:
|
|
|
Type
of Option:
|
o Nonstatutory
Stock Option
o Incentive
Stock Option
|
|
Exercise
Price per Share:
|
$
|
|
Grant
Date:
|
|
|
Vesting Commencement Date:
|
|
|
Vesting
Schedule:
|
This
option may be exercised, in whole or in part, in accordance with
the
following schedule:
[___]%
of the Shares subject to the option shall vest [__] months
after the Vesting Commencement Date, and [__]%
of the Shares subject to the option shall vest each [year/quarter/month]
thereafter, subject to the optionee continuing to be a Service Provider
on
such dates.
|
|
Termination
Period:
|
This
option may be exercised for three months after the optionee's Termination
Date, except that if the Optionee's Termination of Service is for
Cause,
this option shall terminate on the Termination Date. Upon the death
or
Disability of the optionee, this option may be exercised for
12 months after the optionee's Termination Date. Special termination
periods are set forth in Sections 2.3(B), 2.9, and 2.10 below. In
no event
may this option be exercised later than the Term of Award/Expiration
Date
provided below.
|
|
Term
of Award/Expiration Date:
|
2. AGREEMENT
2.1 Grant
of Option.
The
Administrator hereby grants to the optionee named in the Notice of Stock Option
Grant attached as Part I of this Option Agreement (the "Optionee") an option
(the "Option") to purchase the number of Shares, as set forth in the Notice
of
Stock Option Grant, at the exercise price per Share set forth in the Notice
of
Stock Option Grant (the "Exercise Price"), subject to the terms and conditions
of this Option Agreement and the Plan. This Option is intended to be a
Nonstatutory Stock Option ("NSO") or an Incentive Stock Option ("ISO"), as
provided in the Notice of Stock Option Grant.
2.2 Exercise
of Option.
(A) Vesting/Right
to Exercise.
This
Option is exercisable during its term in accordance with the Vesting Schedule
set forth in Section 1 and the applicable provisions of this Option
Agreement and the Plan. In no event will this Option become exercisable for
additional Shares after a Termination of Service for any reason. Notwithstanding
the foregoing, this Option becomes exercisable in full if the Company is subject
to a Change in Control before the Optionee's Termination of Service, and within
12 months after the Change in Control the Optionee is subject to a Termination
of Service resulting from: (i) the Optionee's involuntary discharge by the
Company (or the Affiliate employing him or her) for reasons other than Cause
(defined below), death or Disability; or (ii) the Optionee's resignation for
Good Reason (defined below). This Option may also become exercisable in
accordance with Section 2.11 below.
The
term
"Cause" shall mean (1) the Optionee's theft, dishonesty, or falsification of
any
documents or records of the Company or any Affiliate; (2) the Optionee's
improper use or disclosure of confidential or proprietary information of the
Company or any Affiliate that results or will result in material harm to the
Company or any Affiliate; (3) any action by the Optionee which has a detrimental
effect on the reputation or business of the Company or any Affiliate; (4) the
Optionee's failure or inability to perform any reasonable assigned duties after
written notice from the Company or an Affiliate, and a reasonable opportunity
to
cure, such failure or inability; (5) any material breach by the Optionee of
any
employment or service agreement between the Optionee and the Company or an
Affiliate, which breach is not cured pursuant to the terms of such agreement;
(6) the Optionee's conviction (including any plea of guilty or nolo contendere)
of any criminal act which impairs the Optionee's ability to perform his or
her
duties with the Company or an Affiliate; or (7) violation of a material Company
policy. The term "Good Reason" shall mean, as determined by the Administrator,
(A) a material adverse change in the Optionee's title, stature, authority,
or
responsibilities with the Company (or the Affiliate employing him or her);
(B) a
material reduction in the Optionee's base salary or annual bonus opportunity;
or
(C) receipt of notice that the Optionee's principal workplace will be relocated
by more than 50 miles.
(B) Method
of Exercise.
This
Option is exercisable by delivering to the Administrator a fully executed
"Exercise Notice" or by any other method approved by the Administrator. The
Exercise Notice shall provide that the Optionee is electing to exercise the
Option, the number of Shares in respect of which the Option is being exercised
(the "Exercised Shares"), and such other representations and agreements as
may
be required by the Administrator. Payment of the full aggregate Exercise Price
as to all Exercised Shares must accompany the Exercise Notice. This Option
shall
be deemed exercised upon receipt by the Administrator of such fully executed
Exercise Notice accompanied by such aggregate Exercise Price. The Optionee
is
responsible for filing any reports of remittance or other foreign exchange
filings required in order to pay the Exercise Price.
-2-
2.3 Limitation
on Exercise.
(A) The
grant
of this Option and the issuance of Shares upon exercise of this Option are
subject to compliance with all Applicable Laws. This Option may not be exercised
if the issuance of Shares upon exercise would constitute a violation of any
Applicable Laws. In addition, this Option may not be exercised unless (i) a
registration statement under the Securities Act of 1933, as amended (the
"Securities Act") is in effect at the time of exercise of this Option with
respect to the Shares; or (ii) in the opinion of legal counsel to the Company,
the Shares issuable upon exercise of this Option may be issued in accordance
with the terms of an applicable exemption from the registration requirements
of
the Securities Act. The
Optionee is cautioned that unless the foregoing conditions are satisfied, the
Optionee may not be able to exercise the Option when desired even though the
Option is vested.
As a
further condition to the exercise of this Option, the Company may require the
Optionee to satisfy any qualifications that may be necessary or appropriate,
to
evidence compliance with any applicable law or regulation and to make any
representation or warranty with respect thereto as may be requested by the
Company. Any Shares that are issued will be "restricted securities" as that
term
is defined in Rule 144 under the Securities Act, and will bear an appropriate
restrictive legend, unless they are registered under the Securities Act. The
Company is under no obligation to register the Shares issuable upon exercise
of
this Option.
(B) Special
Termination Period.
If
exercise of the Option on the last day of the termination period set forth
in
Section 1 is prevented by operation of paragraph (A) of this Section 2.3,
then this Option shall remain exercisable until 14 days after the first date
that paragraph (A) no longer operates to prevent exercise of the
Option.
2.4 Method
of Payment.
Payment
of the aggregate Exercise Price shall be by any of the following methods;
provided, however, the payment shall be in strict compliance with all procedures
established by the Administrator:
(A) cash;
(B) check
or
wire transfer;
(C) subject
to any conditions or limitations established by the Administrator, other Shares
that have a Fair Market Value on the date of surrender or attestation equal
to
the aggregate Exercise Price;
(D) consideration
received by the Company under a broker-assisted sale and remittance program
acceptable to the Administrator (Officers and Directors shall not be permitted
to use this procedure if this procedure would violate Section 402 of the
Xxxxxxxx-Xxxxx Act of 2002, as amended);
(E) subject
to any conditions or limitations established by the Administrator, retention
by
the Company of so many of the Shares that would otherwise have been delivered
upon exercise of the Option as have a Fair Market Value on the exercise date
equal to the aggregate exercise price of all Shares as to which the Option
is
being exercised, provided that the Option is surrendered and cancelled as to
such Shares; or
-3-
(F) any
combination of the foregoing methods of payment.
2.5 Leave
of Absence.
The
Optionee shall not incur a Termination of Service when the Optionee goes on
a
bona fide leave of absence, if the leave was approved by the Company (or
Affiliate employing him or her) in writing and if continued crediting of service
is required by the terms of the leave or by applicable law. The Optionee shall
incur a Termination of Service when the approved leave ends, however, unless
the
Optionee immediately returns to active work.
For
purposes of ISOs, no leave of absence may exceed three months, unless the right
to reemployment upon expiration of such leave is provided by statute or
contract. If the right to reemployment is not so provided by statute or
contract, the Optionee will be deemed to have incurred a Termination of Service
on the first day immediately following such three-month period of leave for
ISO
purposes and this Option shall cease to be treated as an ISO and shall terminate
upon the expiration of the three-month period that begins the date the
employment relationship is deemed terminated.
2.6 Non-Transferability
of Option.
This
Option may not be transferred in any manner other than by will or by the laws
of
descent and distribution, and may be exercised during the lifetime of the
Optionee only by the Optionee. The terms of this Option Agreement and the Plan
shall be binding upon the executors, administrators, heirs, successors, and
assigns of the Optionee. This Option may not be assigned, pledged, or
hypothecated by the Optionee whether by operation of law or otherwise, and
is
not subject to execution, attachment, or similar process. Notwithstanding the
foregoing, if this Option is designated as a Nonstatutory Stock Option, the
Administrator may, in its sole discretion, allow the Optionee to transfer this
Option as a gift to one or more family members. For purposes of this Option
Agreement, "family member" means a child, stepchild, grandchild, parent,
stepparent, grandparent, spouse, former spouse, sibling, niece, nephew,
mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law,
or
sister-in-law (including adoptive relationships), any individual sharing the
Optionee's household (other than a tenant or employee), a trust in which one
or
more of these individuals have more than 50% of the beneficial interest, a
foundation in which the Optionee or one or more of these persons control the
management of assets, and any entity in which the Optionee or one or more of
these persons own more than 50% of the voting interest. Notwithstanding the
foregoing, during any California Qualification Period, this Option may not
be
transferred in any manner other than by will, by the laws of descent and
distribution, or, if it is designated as a Nonstatutory Stock Option, as
permitted by Rule 701 of the Securities Act of 1933, as amended, as the
Administrator may determine in its sole discretion.
2.7 Term
of Option.
This
Option may be exercised only within the term set out in the Notice of Stock
Option Grant, and may be exercised during such term only in accordance with
this
Option Agreement and the Plan.
-4-
2.8 Tax
Obligations.
(A) Withholding
Taxes.
The
Optionee shall make appropriate arrangements with the Administrator for the
satisfaction of all applicable Federal, state, local, and foreign income taxes,
employment tax, and any other taxes that are due as a result of the Option
exercise. With the Administrator's consent, these arrangements may include
withholding Shares that otherwise would be issued to the Optionee pursuant
to
the exercise of this Option. The Company may refuse to honor the exercise and
refuse to deliver Shares if such withholding amounts are not delivered at the
time of exercise.
(B) Notice
of Disqualifying Disposition of ISO Shares.
If the
Option is an ISO, and if the Optionee sells or otherwise disposes of any of
the
Shares acquired pursuant to the exercise of the ISO on or before the later
of
(i) the date two years after the Grant Date, or (ii) the date one year
after the date of exercise, the Optionee shall immediately notify the
Administrator in writing of such disposition. The Optionee may be subject to
income tax withholding by the Company on the compensation income recognized
by
the Optionee.
2.9 Special
Termination Period if the Optionee Subject to Section 16(b).
If a
sale within the applicable termination period set forth in Section 1 of
Shares acquired upon the exercise of this Option would subject the Optionee
to
suit under Section 16(b) of the Exchange Act, this Option shall remain
exercisable until the earliest to occur of (i) the tenth day following the
date
on which a sale of such shares by the Optionee would no longer be subject to
such suit, (ii) the 190th day after the Optionee's Termination of Service,
or
(iii) the Expiration Date.
2.10 Special
Termination Period if the Optionee Subject to Blackout Period.
The
Company has established an Xxxxxxx Xxxxxxx Policy (as such policy may be amended
from time to time, the "Policy") relative to trading while in possession of
material, undisclosed information. The Policy prohibits officers, directors,
employees, and consultants of the Company and its subsidiaries from trading
in
securities of the Company during certain "Blackout Periods" as described in
the
Policy. If the last day of the termination period set forth in Section 1 is
during such a Blackout Period, then this Option shall remain exercisable until
14 days after the first date that there is no longer in effect a Blackout Period
applicable to the Optionee.
2.11 Change
in Control.
Upon a
Change in Control before the Optionee's Termination of Service, the Option
will
be assumed or an equivalent option or right substituted by the successor
corporation or a parent or subsidiary of the successor corporation. If the
successor corporation refuses to assume or substitute for the Option, then
immediately before and contingent on the consummation of the Change in Control,
the Optionee will fully vest in and have the right to exercise the Option.
In
addition, if the Option becomes fully vested and exercisable in lieu of
assumption or substitution in the event of a Change in Control, the
Administrator will notify the Optionee in writing or electronically that the
Option will be fully vested and exercisable for a period determined by the
Administrator in its sole discretion, and the Option will terminate upon the
expiration of such period.
2.12 Restrictions
on Resale.
The
Optionee shall not sell any Shares at a time when Applicable Law, Company
policies or an agreement between the Company and its underwriters prohibit
a
sale. This restriction shall apply as long as the Optionee is a Service Provider
and for such period after the Optionee's Termination of Service as the
Administrator may specify.
-5-
2.13 Lock-Up
Agreement.
In
connection with any underwritten public offering of Shares made by the Company
pursuant to a registration statement filed under the Securities Act, the
Optionee shall not offer, sell, contract to sell, pledge, hypothecate, grant
any
option to purchase or make any short sale of, or otherwise dispose of any Shares
(including but not limited to Shares subject to this Option) or any rights
to
acquire Shares of the Company for such period beginning on the date of filing
of
such registration statement with the Securities and Exchange Commission and
ending at the time as may be established by the underwriters for such public
offering; provided, however, that such period shall end not later than 180
days
from the effective date of such registration statement. The foregoing limitation
shall not apply to shares registered for sale in such public
offering.
2.14 Entire
Agreement; Governing Law.
This
Option Agreement and the Plan constitute the entire agreement of the parties
with respect to the subject matter hereof and supersede in their entirety all
prior undertakings and agreements of the Company and Optionee with respect
to
the subject matter hereof, and may not be modified adversely to the Optionee's
interest except by means of a writing signed by the Company and Optionee. This
Option Agreement is governed by the internal substantive laws, but not the
choice of law rules, of California.
2.15 No
Guarantee of Continued Service.
The
vesting of the Option pursuant to the Vesting Schedule hereof is earned only
by
continuing as a Service Provider at the will of the Company (and not through
the
act of being hired, being granted an Option, or purchasing Shares hereunder).
This Option Agreement, the transactions contemplated hereunder, and the Vesting
Schedule set forth herein constitute neither an express nor an implied promise
of continued engagement as a Service Provider for the vesting period, for any
period, or at all, and shall not interfere with Optionee's right or the
Company's right to terminate Optionee's relationship as a Service Provider
at
any time, with or without Cause.
-6-
By
the
Optionee's signature and the signature of the Company's representative below,
the Optionee and the Company agree that this Option is granted under and
governed by the terms and conditions of this Option Agreement and the Plan.
The
Optionee has reviewed this Option Agreement and the Plan in their entirety,
has
had an opportunity to obtain the advice of counsel before executing this Option
Agreement and fully understands all provisions of this Option Agreement and
the
Plan. The Optionee hereby agrees to accept as binding, conclusive, and final
all
decisions or interpretations of the Administrator upon any questions relating
to
this Option Agreement and the Plan.
The
Optionee further agrees that the Company may deliver all documents relating
to
the Plan or this Option (including prospectuses required by the Securities
and
Exchange Commission), and all other documents that the Company is required
to
deliver to its security holders or the Optionee (including annual reports,
proxy
statements and financial statements), either by e-mail or by e-mail notice
of a
Web site location where those documents have been posted. The Optionee may
at
any time (i) revoke this consent to e-mail delivery of those documents;
(ii) update the e-mail address for delivery of those documents;
(iii) obtain at no charge a paper copy of those documents, in each case by
writing the Company at 000 Xxx Xx Xx Xxxxx, Xxxxx 000, Xxxxxx Xxxxx, XX 00000.
The Optionee may request an electronic copy of any of those documents by
requesting a copy from xxxxxxx@xxxxxxxxxxxxxx.xxx. The Optionee understands
that
an e-mail account and appropriate hardware and software, including a computer
or
compatible cell phone and an Internet connection, will be required to access
documents delivered by e-mail.
|
OPTIONEE:
_________________________________
Signature
_________________________________
Print
Name
_________________________________
Residence
Address
|
OPEN
ENERGY CORPORATION
By:_________________________________
Its:_________________________________
|
-7-
