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EXHIBIT 99.9
SUMMA FOUR, INC.
1992 STOCK INCENTIVE PLAN
NON-STATUTORY STOCK OPTION AGREEMENT
1. GRANT OF OPTION. Summa Four, Inc., a Delaware corporation (the "Company"),
hereby grants to _______________ (the "Optionee"), an option, pursuant to the
Company's 1993 Stock Incentive Plan (the "Plan"), to purchase an aggregate of
__________ shares of Common Stock ("Common Stock") of the Company at a price of
$_______ per share, purchasable as set forth in and subject to the terms and
conditions of this option and the Plan. Except where the context otherwise
requires, the term "Company" shall include the parent and all present and future
subsidiaries of the Company as defined in Sections 424(e) and 242(f) of the
Internal Revenue Code of 1986, as amended or replaced from time to time (the
"Code").
2. NON-STATUTORY STOCK OPTION. This option is not intended to qualify as an
incentive stock option ("Incentive Stock Option") within the meaning of Section
422 of the Code.
3. EXERCISE OF OPTION AND PROVISIONS FOR TERMINATION.
(a) Vesting Schedule. Except as otherwise provided in this Agreement, this
option may be exercised prior to the tenth anniversary of the date of grant
(hereinafter the "Expiration Date") in installments as to not more than the
number of shares set forth in the table below during the respective installment
periods set forth in the table below.
Number of Shares
as to which
Exercise Period Option is Exercisable
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The right of exercise shall be cumulative so that if the option is not exercised
to the maximum extent permissible during any exercise period, it shall be
exercisable, in whole or in part, with respect to all shares not so purchased at
any time prior to the Expiration Date or the earlier termination of this option.
This option may not be exercised at any time on or after the Expiration Date.
(b) Exercise Procedure. Subject to the conditions set forth in this Agreement,
this option shall be exercised by the Optionee's delivery of written notice of
exercise to the Treasurer of the Company, specifying the number of shares to be
purchased and the purchase price to be paid therefor and accompanied by payment
in full in accordance with Section 4. Such exercise shall be effective upon
receipt by the Treasurer of the Company of such written notice together with the
required payment. The Optionee may purchase less than the number of shares
covered hereby, provided that no partial exercise of this option may be for any
fractional share or for fewer than ten whole shares.
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(c) Continuous Employment Required. Except as otherwise provided in this Section
3, this option may not be exercised unless the Optionee, at the time he or she
exercises this option, is, and has been at all times since the date of grant of
this option, a director of the Company.
(d) Exercise Period. If the Optionee ceases to be a director of the Company for
any reason, then, except as provided in paragraphs (e) and (f) below, the right
to exercise this option shall terminate twelve (12) months after such cessation
(but in no event after the Expiration Date), provided that this option shall be
exercisable only to the extent that the Optionee was entitled to exercise this
option on the date of such cessation. The Company's obligation to deliver shares
upon the exercise of this option shall be subject to the satisfaction of all
applicable federal, state and local income and employment tax withholding
requirements, arising by reason of this option being treated as a non-statutory
option or otherwise. Notwithstanding the foregoing, if the Optionee, prior to
the Expiration Date, materially violates the non-competition or confidentiality
provisions of any employment contract, confidentiality and nondisclosure
agreement or other agreement between the Optionee and the Company; the right to
exercise this option shall terminate immediately upon written notice to the
Optionee from the Company describing such violation.
(e) Exercise Period Upon Death or Disability. If the Optionee dies or becomes
disabled (within the meaning of Section 22(e)(3) of the Code) prior to the
Expiration Date while he or she is a director of the Company, or if the Optionee
dies within three months after the Optionee ceases to be a director of the
Company (other than as a result of a discharge for "cause" as specified in
paragraph (f) below), this option shall be exercisable, within the period of one
year following the date of death or disability of the Optionee (but in no event
after the Expiration Date), by the Optionee or by the person to whom this option
is transferred by will or the laws of descent and distribution, provided that
this option shall be exercisable only to the extent that this option was
exercisable by the Optionee on the date of his or her death or disability.
Except as otherwise indicated by the context, the term "Optionee", as used in
this option, shall be deemed to include the estate of the Optionee or any person
who acquires the right to exercise this option by bequest or inheritance or
otherwise by reason of the death of the Optionee.
4. PAYMENT OF PURCHASE PRICE. (a) Method of Payment. Payment of the purchase
price for shares purchased upon exercise of this option shall be made by
delivery of cash or check in an amount equal to the exercise price of such
options or, with the prior consent of the Company (which may be withheld in its
sole discretion), by (A) delivery of shares of Common Stock owned by the
Optionee for at least six months, valued at their fair market value, as
determined in (b) below, (B) delivery of a promissory note of the optionee to
the Company on terms determined by the Board, c delivery of an irrevocable
undertaking by a broker to deliver promptly to the Company sufficient funds to
pay the exercise price or delivery of irrevocable instructions to a broker to
deliver promptly to the Company cash or a check sufficient to pay the exercise
price, (D) payment of such other lawful consideration as the Board may
determine, or (E) any combination of the foregoing.
(b) Valuation of Shares or Other Not-Cash Consideration Tendered in Payment of
Purchase Price. For the purposes hereof, the fair market value of any share of
the Company's Common Stock or other non-cash consideration which may be
delivered to the Company in exercise of this
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option shall be determined in good faith or in the manner determined by the
Board of Directors of the Company from time to time.
(c) Delivery of Shares Tendered in Payment of Purchase Price. If the Optionee
exercises options by delivery of shares of Common Stock of the Company, the
certificate or certificates representing the shares of Common Stock of the
Company to be delivered shall be duly executed in blank by the Optionee or shall
be accompanied by a stock power duly executed in blank suitable for purposes of
transferring such shares to the Company. Fractional shares of Common Stock of
the Company will not be accepted in payment of the purchase price of shares
acquired upon exercise of this option.
(d) Restrictions on use of Option Stock. Notwithstanding the foregoing, no
shares of Common Stock of the Company may be tendered in payment of the purchase
price of shares purchased upon exercise of this option if the shares to be so
tendered were acquired within six months before the date of such tender, through
the exercise of an option granted under the Plan or any other stock option or
restricted stock plan of the Company.
5. DELIVERY OF SHARES: COMPLIANCE WITH SECURITIES LAWS, ETC. The Company will
not be obligated to deliver any shares of Stock pursuant to the Plan or to
remove restriction from shares previously delivered under the Plan (i) until all
conditions of the option have been satisfied or removed, (ii) until, in the
opinion of the Company's counsel, all applicable federal and state laws and
regulations have been complied with, (iii) if the outstanding Stock is at the
time listed on any stock exchange, until the shares to be delivered have been
listed or authorized to be listed on such exchange upon official notice of
notice of issuance, and (iv) until all other legal matters in connection with
the issuance and delivery of such shares have been approved by the Company's
counsel.
6. NONTRANSFERABILITY OF OPTION. This option is personal and no rights granted
hereunder may be transferred, assigned, pledged or hypothecated in any way
(whether by operation of law or otherwise) nor shall any such rights be subject
to execution, attachment or similar process, except that this option may be
transferred (i) by will or the laws of descent and distribution or (ii) pursuant
to a qualified domestic relations order as defined in Section 414(p) of the
Code. Upon any attempt to transfer, assign, pledge, hypothecate or otherwise
dispose of this option or of such rights contrary to the provisions hereof, or
upon the levy of any attachment or similar process upon this option or such
rights, this option and such rights shall, at the election of the Company,
become null and void.
7. NO SPECIAL EMPLOYMENT OR SIMILAR RIGHTS. Nothing contained in the Plan or
this option shall be construed or deemed by any person under any circumstances
to bind the Company to continue of the Optionee with the Company for the period
within which this option may be exercised. The Company expressly reserves the
fight at any time to dismiss the Optionee free from any liability or claim under
the Plan, except as otherwise expressly provided in this Agreement.
8. RIGHTS AS A SHAREHOLDER. The Optionee shall have no rights as a shareholder
with respect to any shares which may be purchased by exercise of this option
(including, without limitation, any rights to receive dividends or non-cash
distributions with respect to such shares)
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unless and until a certificate representing such shares is duly issued and
delivered to the Optionee. No adjustment shall be made for dividends or other
rights for which the record date is prior to the date such stock certificate is
issued.
9. ADJUSTMENT PROVISIONS. In the event that the Board, in its sole discretion,
determines that any stock dividend, extraordinary cash dividend,
recapitalization, reorganization, merger, consolidation, split-up, spin-off,
combination or other similar transaction affects the Common Stock such that an
adjustment is required in order to preserve the benefits or potential benefits
intended to be made available under the Plan, then the Board shall equitably
adjust either or both (i) the number and kind of shares subject to this option,
and (ii) the award, exercise or conversion price with respect to the foregoing,
and if considered appropriate, the Board may make provision for a cash payment
with respect to this option, provided that the number of shares subject to this
option shall always be a whole number.
10. MERGERS, ETC. (X) Except as set forth in subparagraph (Y) below, in the
event of a consolidation, merger or other reorganization in which all of the
outstanding shares of Common Stock are exchanged for securities, cash or other
property of any other corporation or business entity (an "Acquisition") or in
the event of a liquidation of the Company, the Board of Directors of the
Company, or the board of directors of any corporation assuming the obligations
of the Company, may, in its discretion, take any one or more of the following
actions as to this Option: (i) provide that this Option shall be assumed, or a
substantially equivalent Option shall be substituted, by the acquiring or
succeeding corporation (or an affiliate thereof) on such terms as the Board
determines to be appropriate, (ii) upon written notice to Optionee, provide that
if unexercised, this Option will terminate immediately prior to the consummation
of such transaction unless exercised by the Optionee within a specified period
following the date of such notice, (iii) in the event of an Acquisition under
the terms of which holders of the Common Stock of the Company will receive upon
consummation thereof a cash payment for each share surrendered in the
Acquisition (the "Acquisition Price"), make or provide for a cash payment to the
Optionee equal to the difference between (A) the Acquisition Price times the
number of shares of Common Stock subject to outstanding Options (to the extent
then exercisable at prices not in excess of the Acquisition Price) and (B) the
aggregate exercise price of all such outstanding Options in exchange for the
termination of such Options, and (iv) provide that all or any outstanding
Options shall become exercisable or realizable in full prior to the effective
date of such Acquisition. (Y) Notwithstanding any other provision to the
contrary, in the event of a Change of Control (as defined below), all options
outstanding as of the date such Change in Control occurs shall become
exercisable in full, whether or not exercisable in accordance with their terms.
A "Change in Control" shall occur or be deemed to have occurred only if any of
the following events occur: (i) any "person," as such term is used in Sections
13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act") (other than the Company, any trustee or other fiduciary holding
securities under an employee benefit plan of the Company, or any corporation
owned directly or indirectly by the stockholders of the Company in substantially
the same proportion as their ownership of stock of the Company) is or becomes
the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing 50% or more of
the combined voting power of the Company's then outstanding securities; (ii)
individuals who, as of the date the Plan was adopted, constitute the Board of
Directors of the Company (as of the date thereof, the "Incumbent Board") cease
for any reason to constitute at least a majority of the Board, provided that any
person
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becoming a director subsequent to the date thereof whose election, or nomination
for election by the Company's stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board (other than an
election or nomination of an individual whose initial assumption of office is in
connection with an actual or threatened election contest relating to the
election of the directors of the Company, as such terms are used in Rule 14a-11
of Regulation 14A under the Exchange Act) shall be, for purposes of this
Agreement, considered as though such person were a member of the Incumbent
Board; (iii) the stockholders of the Company approve a merger or consolidation
of the Company with any other corporation, other than (A) a merger or
consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) more than 50% of the combined voting power of the voting
securities of the Company or such surviving entity outstanding immediately after
such merger or consolidation or (B) a merger or consolidation effected to
implement a recapitalization of the Company (or similar transaction) in which no
"person" (as hereinabove defined) acquires more than 30% of the combined voting
power of the Company's then outstanding securities; or (iv) the stockholders of
the Company approve a plan of complete liquidation of the Company or an
agreement for the sale or disposition by the Company of all or substantially all
of the Company's assets.
11. WITHHOLDING TAXES. The Company's obligation to deliver shares upon the
exercise of this option shall be subject to the Optionee's satisfaction of all
applicable federal, state and local income and employment tax withholding
requirements. The Optionee shall pay to the Company, or make provision
satisfactory to the Board for payment of, any taxes required by law to be
withheld in respect of options under the Plan no later than the rate of the
event creating the tax liability. In the Board's discretion, and subject to such
conditions as the Board may establish, such tax obligations may be paid in whole
or in part in shares of Common Stock, including shares retained from the option
creating the tax obligation, valued at their fair market value. The Company may,
to the extent permitted by law, deduct any such tax obligations from any payment
of any kind otherwise due to the Optionee.
12. MISCELLANEOUS.
(a) The Board may amend, modify or terminate any outstanding option, including
substituting therefor another option of the same or a different type, changing
the date of exercise or realization, provided that the Optionee's consent to
such action shall be required unless the Board determines that the action,
taking into account any related action, would not materially and adversely
affect the Optionee. The Board may at any time accelerate the time at which all
or any part of an Option may be exercised.
(b) All notices under this option shall be mailed or delivered by hand to the
parties at their respective addresses set forth beneath their names below or at
such other address as may be designated in writing by either of the parties to
one another.
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(c) This option shall be governed by and construed in accordance with the laws
of the State of New Hampshire.
SUMMA FOUR, INC.
By: ____________________________
Title: ____________________________
Address:____________________________
____________________________
OPTIONEE'S ACCEPTANCE
The undersigned hereby accepts the foregoing option and agrees to the terms and
conditions thereof. The undersigned hereby acknowledges receipt of a copy of the
Company's 1992 Stock Incentive Plan.
Option # By: ____________________________
Address:____________________________
____________________________
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