NONQUALIFIED STOCK OPTION AGREEMENT
Exhibit
10.2
2007
EQUITY INCENTIVE PLAN
This
NONQUALIFIED STOCK OPTION AGREEMENT (this “Option Agreement”), dated as of the
____ day of ________________ (the “Grant Date”), is between Lightning Gaming,
Inc., a Nevada corporation (the “Company”), and _______________ (the
“Optionee”), a _________ of the Company or of a “Related Corporation,” as
defined in the Lightning Gaming, Inc. 2007 Equity Incentive Plan (the
“Plan”).
WHEREAS,
the Company desires to give the Optionee the opportunity to purchase shares of
common stock of the Company (“Common Stock”) in accordance with the provisions
of the Plan, a copy of which is attached hereto;
NOW
THEREFORE, in consideration of the mutual covenants hereinafter set forth and
for other good and valuable consideration, the parties hereto, intending to be
legally bound hereby, agree as follows:
1. Grant of
Option. The Company hereby grants to the Optionee the right
and option (the “Option”) to purchase all or any part of an aggregate of
________ shares of Common Stock. The Option is in all respects limited and
conditioned as hereinafter provided, and is subject in all respects to the terms
and conditions of the Plan now in effect and as it may be amended from time to
time (but only to the extent that such amendments apply to outstanding options).
Such terms and conditions are incorporated herein by reference, made a part
hereof, and shall control in the event of any conflict with any other terms of
this Option Agreement. The Option granted hereunder is intended to be a
nonqualified stock option (“NQSO”) and not an incentive
stock option, as such term is defined in section 422 of the Internal Revenue
Code of 1986, as amended (the “Code”).
The
Optionee acknowledges that he or she has received a copy of the Plan together
with, or prior to receipt of, this Option Agreement and that he or she has fully
reviewed the Plan.
2. Exercise
Price. The exercise price of the shares of Common Stock
covered by this Option shall be $____ per share. It is the
determination of the “Committee” (as defined in the Plan) that on the Grant Date
the exercise price was not less than the greater of (i) 100% of the “Fair
Market Value” (as defined in the Plan) of a share of Common Stock, or
(ii) the par value of a share of Common Stock.
3. Term. Unless
earlier terminated pursuant to any provision of the Plan or this Option
Agreement, this Option shall expire on ______________________ (the “Expiration
Date”), which date is not more than 10 years from the Grant Date. This Option
shall not be exercisable on or after the Expiration Date.
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4. Exercise of
Option. The Optionee shall have the right to purchase from the
Company, on and after the following vesting dates, the following number of
shares of Common Stock subject to the Option, provided the Optionee has not
terminated his or her service as of the applicable vesting date:
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Date
Installment Becomes
Exercisable (Vesting Date)
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Number of Shares
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Notwithstanding
the above, the Option shall be fully vested on the date of a Change in Control.
A Change in Control shall be deemed to occur for this purpose if:
(i) A
person, including a “group” as such term is used in Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended, becomes the beneficial owner,
directly or indirectly, of 50.1% or more of the total voting power or fair
market value of stock of the Company.
(ii) There
is a sale of all or substantially all the assets of the Company.
(iii) There
is a merger or consolidation of the Company as a result of which the individuals
and entities who were the beneficial owners of the stock of the Company do not
beneficially own, immediately after such merger or consolidation, directly or
indirectly, 50.1% or more of the total voting power and fair market value of the
stock resulting from such merger or consolidation in substantially the same
proportion as their ownership of the stock of the Company prior to such merger
or consolidation.
The
Committee may accelerate any vesting date of the Option, in its discretion, if
it deems such acceleration to be desirable. Once the Option becomes vested, it
will remain vested and exercisable until it is exercised or until it
terminates.
5. Method of Exercising
Option. Subject to the terms and conditions of this Option Agreement and
the Plan, the Option may be exercised by written notice to the Company at its
principal office, which is presently located at 000 Xxxxxxx Xxxxxxx, Xxxxxxxx,
Xxxxxxxxxxxx 00000. The form of such notice is attached hereto and shall state
the election to exercise the Option and the number of whole shares with respect
to which it is being exercised; shall be signed by the person or persons so
exercising the Option; and shall be accompanied by payment of the full exercise
price of such shares. Only full shares will be issued.
The
exercise price shall be paid to the Company -
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(a) in
cash, or by check (acceptable to the Company), bank draft, or money
order;
(b) through
the delivery of shares of Common Stock previously acquired by the
Optionee;
(c) in
shares of Common Stock newly acquired by the Optionee upon the exercise of the
Option; or
(d) in
any combination of (a), (b), or (c) above.
In the
event the exercise price is paid, in whole or in part, with shares of Common
Stock, the portion of the exercise price so paid shall be equal to the “Fair
Market Value” (as defined in the Plan) of the Common Stock surrendered on the
date of exercise.
Upon
receipt of notice of exercise and payment, the Company shall deliver a
certificate or certificates representing the shares with respect to which the
Option is so exercised. The Optionee shall obtain the rights of a shareholder
upon receipt of the certificate(s) representing such Common Stock.
Such
certificate(s) shall be registered in the name of the person so exercising the
Option (or, if the Option is exercised by the Optionee and if the Optionee so
requests in the notice exercising the Option, shall be registered in the name of
the Optionee and the Optionee’s spouse jointly, with right of survivorship), and
shall be delivered as provided above to, or upon the written order of, the
person exercising the Option. In the event the Option is exercised by any person
or persons after the death or “Disability” (as defined in the Plan) of the
Optionee, the notice shall be accompanied by appropriate proof of the right of
such person or persons to exercise the Option. All shares that are purchased
upon exercise of the Option as provided herein shall be fully paid and
non-assessable.
6. Shares to be Purchased for
Investment. Unless the Company has notified the Optionee that a
registration statement covering the shares to be acquired upon the exercise of
the Option has become effective under the Securities Act of 1933, as amended
(the “Act”), and the Company has not thereafter notified the Optionee that such
registration statement is no longer effective, it shall be a condition to any
exercise of this Option that the shares acquired upon such exercise be acquired
for investment and not with a view to distribution, and the person effecting
such exercise shall submit to the Company a certificate of such investment
intent, together with such other evidence supporting the same as the Company may
request. The Company shall be entitled to restrict the transferability of the
shares issued upon any such exercise to the extent necessary to avoid a risk of
violation of the Act (or of any rules or regulations promulgated thereunder), or
of any state laws or regulations. Such restrictions may, at the option of the
Company, be noted or set forth in full on the share certificates.
7. Non-Transferability of
Option. This Option is not assignable or transferable, in whole or in
part, by the Optionee other than by will or by the laws of descent
and
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distribution. During
the lifetime of the Optionee, the Option shall be exercisable only by the
Optionee or, in the event of his or her Disability, by his or her guardian or
legal representative.
8. Termination of
Service. If the Optionee’s service with the Company and all
Related Corporations is terminated prior to the Expiration Date for any reason,
other than for “Cause” (as defined in the Plan), death or Disability, this
Option may be exercised at any time prior to the Expiration Date, but only to
the extent of the number of shares with respect to which the Optionee could have
exercised it immediately before such termination of service. Any part of the
Option that was not exercisable immediately before the Optionee’s termination of
service shall terminate at that time. In the event the Optionee’s service is
terminated for Cause, this Option (regardless of the extent to which it was then
exercisable) shall terminate in its entirety on the date of such termination of
service.
9. Disability. If
the Optionee incurs a Disability during his or her service and, prior to the
Expiration Date, the Optionee’s service is terminated as a consequence of such
Disability, this Option may be exercised at any time prior to the Expiration
Date, but only to the extent of the number of shares with respect to which the
Optionee could have exercised it immediately before such termination of
service. Any part of the Option that was not exercisable immediately
before the Optionee’s termination of service shall terminate at that
time.
10. Death. If
the Optionee dies during his or her service and prior to the Expiration Date, or
if the Optionee’s service is terminated for any other reason except Cause (as
described in Paragraphs 8 and 9) and the Optionee dies following his or her
termination of service but prior to the Expiration Date, this Option may be
exercised at any time prior to the Expiration Date by the Optionee’s estate,
personal representative or beneficiary who acquired the right to exercise this
Option by bequest or inheritance or by reason of the Optionee’s death, but only
to the extent of the number of shares with respect to which the Optionee could
have exercised it immediately prior to his or her death. Any part of the Option
that was not exercisable immediately before the Optionee’s death shall terminate
at that time.
11. Withholding of
Taxes. The obligation of the Company to deliver shares of
Common Stock upon the exercise of this Option shall be subject to applicable
federal, state and local tax withholding requirements. If the
exercise of the Option is subject to the withholding requirements of applicable
federal, state or local tax law, the Optionee, subject to the provisions of the
Plan and such additional withholding rules (the “Withholding Rules”) as shall be
adopted by the Committee, may satisfy the withholding tax, in whole or in part,
by electing to have the Company withhold (or by returning to the Company) shares
of Common Stock, which shares shall be valued, for this purpose, at their Fair
Market Value on the date the amount attributable to the exercise of the Option
is includable in income by the Optionee under section 83 of the
Code. Such election must be made in compliance with and subject to
the Withholding Rules, and the Company may limit the number of withheld shares
to the extent necessary to avoid adverse accounting consequences.
12. Rights as a
Shareholder. The issuance of a stock certificate shall be
conditioned upon the Optionee’s execution of any Shareholders Agreement in
effect at such time.
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13. Governing
Law. This Option Agreement shall be governed by the applicable
Code provisions to the maximum extent possible. Otherwise, the laws of the State
of Nevada (without reference to principles of conflict of laws) shall govern the
operation of, and the rights of the Optionee under, the Plan and the
Option.
IN
WITNESS WHEREOF, this Option Agreement has been duly executed by the Company and
the Optionee as of the date first set forth above.
By: ______________________________
Name:
Title:
OPTIONEE:
__________________________________
Name:
Name:
5
2007
EQUITY INCENTIVE PLAN
Notice of
Exercise of Nonqualified Stock Option
I hereby
exercise the nonqualified stock option granted to me pursuant to the
Nonqualified Stock Option Agreement dated as of __________________, ___ (the
“Option”), by Lightning Gaming, Inc. (the “Company”), with respect to the
following number of shares of the Company’s common stock (“Shares”) covered by
the Option:
Number of
Shares to be
purchased:
_______
Purchase
price per
Share: $______
Total
purchase
price: $______
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____
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A.
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Enclosed
is cash or my check, bank draft, or money order in the amount of
$_________ in full/partial [circle one] payment for
such Shares;
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and/or
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____
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B.
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Enclosed
is/are
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Share(s)
with a total fair market value of $________ on the date hereof in
full/partial [circle one]
payment for such Shares;
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and/or
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____
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C.
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I
elect to satisfy the payment for Shares purchased hereunder by having the
Company withhold newly acquired Shares pursuant to the exercise of the
Option.
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Please
have the certificate or certificates representing the purchased Shares
registered in the following name or names*:
________________________________________; and sent to
________________________________________________________________.
If the
condition in Paragraph 6 (“Shares to be Purchased for Investment”) of the
Nonqualified Stock Option Agreement related to the Shares purchased hereby is
applicable, the undersigned hereby certifies that the Shares purchased hereby
are being acquired for investment and not with a view to the distribution of
such Shares.
| DATE: | ||
| Optionee’s Signature |
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*
Certificates may be registered in the name of the Optionee alone or in the
joint names (with right of survivorship) of the Optionee and his or her
spouse.
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