Exhibit 10.06
FOUNDER'S RESTRICTED STOCK PURCHASE AGREEMENT
This Agreement is made and entered into as of April 26, 1999 (the
"Effective Date") between XxxXxxxxxxxx.xxx (the "Company"), a California
corporation, and ________ (the "Purchaser").
1. PURCHASE OF SHARES. On the Effective Date and subject to the terms
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and conditions of this Agreement, Purchaser hereby purchases from the Company,
and Company hereby sells to Purchaser, an aggregate of ____________ (_____)
shares of the Company's Common Stock (the "Shares") at an aggregate purchase
price of $_____ (the "Purchase Price") or $0.004167 per Share (the "Purchase
Price Per Share"). Additionally, in connection with the purchase of the Shares,
Purchaser agrees to assign to the Company as a contribution to capital certain
technology and related rights pursuant to the form of Assignment Agreement
attached hereto as Exhibit 2. As used in this Agreement, the term "Shares"
refers to the Shares purchased under this Agreement and includes all securities
received (i) in replacement of the Shares, (ii) as a result of stock dividends
or stock splits with respect to the Shares, and (iii) in replacement of the
Shares in a merger, recapitalization, reorganization or similar corporate
transaction.
2. PAYMENT OF PURCHASE PRICE; CLOSING.
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2.1 Deliveries by Purchaser. Purchaser hereby delivers to the
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Company: (i) a duly executed copy of this Agreement, (ii) two (2) copies of a
blank Stock Power and Assignment Separate from Stock Certificate in the form of
Exhibit 1 attached hereto (the "Stock Powers"), both executed by Purchaser (and
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Purchaser's spouse, if any), and (iii) payment of the Purchase Price in cash, by
delivery of a check, a copy of which is attached hereto as Exhibit 2. Purchaser
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also hereby assigns to the Company certain technology and related rights owned
by Purchaser by delivery to the Company of an Assignment Agreement in the form
attached hereto as Exhibit 2, duly executed by Purchaser.
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2.2 Deliveries by the Company. Upon its receipt of the entire
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Purchase Price and all the documents to be executed and delivered by Purchaser
to the Company under Section 2.1, the Company will issue a duly executed stock
certificate evidencing the Shares in the name of Purchaser, registered in
Purchaser's name in accordance with Section 14, with such certificate to be
placed in escrow as provided in Section 8 until expiration or termination of
both the Company's Repurchase Option and Right of First Refusal described in
Sections 5 and 6.
3. REPRESENTATIONS AND WARRANTIES OF PURCHASER. Purchaser represents and
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warrants to the Company that:
3.1 Purchase for Own Account for Investment. Purchaser is purchasing
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the Shares for Purchaser's own account for investment purposes only and not with
a view to, or for sale in connection with, a distribution of the Shares within
the meaning of the Securities Act of 1933, as amended (the "1933 Act").
Purchaser has no present intention of selling or otherwise disposing of all or
any portion of the Shares and no one other than Purchaser has any beneficial
ownership of any of the Shares.
3.2 Access to Information. Purchaser has had access to all
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information regarding the Company and its present and prospective business,
assets, liabilities and financial
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condition that Purchaser reasonably considers important in making the decision
to purchase the Shares, and Purchaser has had ample opportunity to ask questions
of the Company's representatives concerning such matters and this investment.
3.3 Understanding of Risks. Purchaser is a founder of the Company
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and is fully aware of: (i) the highly speculative nature of the investment in
the Shares; (ii) the financial hazards involved; (iii) the lack of liquidity of
the Shares and the restrictions on transferability of the Shares (e.g., that
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Purchaser may not be able to sell or dispose of the Shares or use them as
collateral for loans); (iv) the qualifications and backgrounds of the management
of the Company; and (v) the tax consequences of investment in the Shares.
3.4 Purchaser's Qualifications. Purchaser has a preexisting personal
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or business relationship with the Company and/or certain of its officers and/or
directors of a nature and duration sufficient to make Purchaser aware of the
character, business acumen and general business and financial circumstances of
the Company and/or such officers and directors. By reason of Purchaser's
business or financial experience, Purchaser is capable of evaluating the merits
and risks of this investment, has the ability to protect Purchaser's own
interests in this transaction and is financially capable of bearing a total loss
of this investment.
3.5 No General Solicitation. At no time was Purchaser presented with
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or solicited by any publicly issued or circulated newspaper, mail, radio,
television or other form of general advertising or solicitation in connection
with the offer, sale and purchase of the Shares.
3.6 Compliance with Securities Laws. Purchaser understands and
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acknowledges that, in reliance upon the representations and warranties made by
Purchaser herein, the Shares are not being registered with the Securities and
Exchange Commission ("SEC") under the 1933 Act or being qualified under the
California Corporate Securities Law of 1968, as amended (the "Law"), but instead
are being issued under an exemption or exemptions from the registration and
qualification requirements of the 1933 Act and the Law which impose certain
restrictions on Purchaser's ability to transfer the Shares.
3.7 Restrictions on Transfer. Purchaser understands that Purchaser
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may not transfer any Shares unless such Shares are registered under the 1933 Act
or qualified under the Law or unless, in the opinion of counsel to the Company,
exemptions from such registration and qualification requirements are available.
Purchaser understands that only the Company may file a registration statement
with the SEC or the California Commissioner of Corporations and that the Company
is under no obligation to do so with respect to the Shares. Purchaser has also
been advised that exemptions from registration and qualification may not be
available or may not permit Purchaser to transfer all or any of the Shares in
the amounts or at the times proposed by Purchaser.
3.8 Rule 144. In addition, Purchaser has been advised that SEC Rule
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144 promulgated under the 1933 Act, which permits certain limited sales of
unregistered securities, is not presently available with respect to the Shares
and, in any event, requires that the Shares be held for a minimum of one (1)
year, and in certain cases two (2) years, after they have been purchased and
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paid for (within the meaning of Rule 144), before they may be resold under Rule
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144. Purchaser understands that Rule 144 may indefinitely restrict transfer of
the Shares so long as Purchaser remains an "affiliate" of the Company and
"current public information" about the Company (as defined in Rule 144) is not
publicly available.
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4. COMPLIANCE WITH CALIFORNIA SECURITIES LAWS. THE SALE OF THE
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SECURITIES THAT ARE THE SUBJECT OF THIS AGREEMENT, IF NOT YET
QUALIFIED WITH THE CALIFORNIA COMMISSIONER OF CORPORATIONS AND NOT
EXEMPT FROM SUCH QUALIFICATION, IS SUBJECT TO SUCH QUALIFICATION, AND
THE ISSUANCE OF SUCH SECURITIES, AND THE RECEIPT OF ANY PART OF THE
CONSIDERATION THEREFOR PRIOR TO SUCH QUALIFICATION IS UNLAWFUL UNLESS
THE SALE IS EXEMPT. THE RIGHTS OF THE PARTIES TO THIS AGREEMENT ARE
EXPRESSLY CONDITIONED UPON SUCH QUALIFICATION BEING OBTAINED OR AN
EXEMPTION BEING AVAILABLE.
5. COMPANY'S REPURCHASE OPTION. The Company or its assignees shall have
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the option to repurchase all or a portion of the Unvested Shares (as defined
below) on the terms and conditions set forth in this Section (the "Repurchase
Option") if Purchaser ceases to be employed by the Company (as defined herein)
for any reason, or no reason, including without limitation Purchaser's death,
disability, voluntary resignation or termination by the Company with or without
cause.
5.1 Definition of "Employed by the Company"; "Termination Date". For
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purposes of this Agreement, Purchaser will be considered to be "employed by the
Company" if the Board of Directors of the Company determines that Purchaser is
rendering substantial services as an officer, employee, consultant or
independent contractor to the Company or to any parent, subsidiary or affiliate
of the Company. In case of any dispute as to whether Purchaser is employed by
the Company, the Board of Directors of the Company shall have sole discretion to
determine whether Purchaser has ceased to be employed by the Company or any
parent, subsidiary or affiliate of the Company and the effective date on which
Purchaser's employment terminated (the "Termination Date").
5.2 Unvested and Vested Shares. Shares that are vested pursuant to
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the schedule set forth herein are "Vested Shares". Shares that are not vested
pursuant to the schedule set forth herein are "Unvested Shares". Unvested
Shares may not be sold or otherwise transferred by Purchaser without the
Company's prior written consent. On the Effective Date __________of the Shares
will be Unvested Shares. For so long (and only for so long) as Purchaser
remains continuously employed by the Company or any Subsidiary or Parent of the
Company, at all times after the Effective Date, 1/4 of the originally Unvested
Shares will become Vested Shares one year following the Effective Date and an
additional 1/48 of the originally Unvested Shares will become Vested Shares upon
the expiration of each full succeeding month elapsed thereafter; provided,
however, that all Unvested Shares shall become Vested Shares immediately prior
to the closing of a Change of Control (as defined below). No Unvested Shares
will become Vested Shares after the Termination Date. If the application of the
vesting percentage causes a fractional share, such share shall be rounded down
to the nearest whole share for each month except for the last month in such
vesting period, at the end of which last month the balance of Unvested Shares
shall become fully Vested Shares. A "Change of Control" shall mean the
occurrence of any of the following events: (i) a merger, reorganization or
consolidation of the Company in which the shareholders of the Company before
such merger, reorganization or consolidation own less than fifty percent (50%)
of the outstanding voting equity securities of the Company or entity surviving
such merger, reorganization or consolidation, (ii) a sale or other transfer of
all or substantially all of the assets of the Company, or (iii) a transfer of
more than
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fifty percent (50%) of the outstanding voting equity securities of the Company
in one transaction or a series of related transactions.
5.3 Adjustments. The number of Shares that are Vested Shares or
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Unvested Shares will be proportionally adjusted to reflect any stock dividend,
stock split, reverse stock split or recapitalization of the common stock of the
Company occurring after the Effective Date.
5.4 Exercise of Repurchase Option at Original Price. At any time
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within ninety (90) days after the Termination Date, the Company may elect to
repurchase any or all of the Unvested Shares by giving Purchaser written notice
of exercise of the Repurchase Option. The Company and/or its assignee(s) will
then have the option to repurchase from Purchaser (or from Purchaser's personal
representative as the case may be) any or all of the Unvested Shares at the
Purchaser's original Purchase Price Per Share, as proportionally adjusted to
reflect any stock dividend, stock split, reverse stock split or recapitalization
of the common stock of the Company occurring after the Effective Date (the
"Repurchase Price").
5.5 Payment of Repurchase Price. The Repurchase Price will be
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payable, at the option of the Company or its assignee(s), by check or by
cancellation of all or a portion of any outstanding indebtedness owed by
Purchaser to the Company (or to such assignee) or by any combination thereof.
The Repurchase Price will be paid without interest within one hundred twenty
(120) days after the Termination Date.
5.6 Right of Termination Unaffected. Nothing in this Agreement will
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be construed to limit or otherwise affect in any manner whatsoever the right or
power of the Company (or any parent, subsidiary or affiliate of the Company) to
terminate Purchaser's employment with the Company (or any parent, subsidiary or
affiliate of the Company) at any time for any reason or no reason, with or
without cause.
6. RIGHT OF FIRST REFUSAL. Unvested Shares may not be sold, pledged or
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otherwise transferred by gift or otherwise (a "Transfer") by Purchaser without
the Company's prior written consent. Before any Vested Shares held by Purchaser
or any transferee of such Vested Shares (either being sometimes referred to
herein as the "Holder") may be Transferred (including without limitation any
Transfer by (i) an assignment of any Shares for the benefit of creditors of the
Holder, (ii) operation of law, (iii) an execution of judgment against the Shares
or the acquisition of record or beneficial ownership of Shares by a lender or
creditor, (iv) will or under the laws of descent and distribution, (v) any
decree of divorce, dissolution or separate maintenance, any property settlement,
any separation agreement or any other agreement with a spouse (except for bona
fide estate planning purposes) under which any Shares are Transferred or awarded
to the spouse of the Holder or are required to be sold, or (vi) the filing by
the Holder of a petition for relief or the filing of an involuntary petition
against Holder, under the bankruptcy laws of the United States or of any other
nation (each instance referred to hereafter as the "Involuntary Transfer")), the
Company and/or its assignee(s) will have a right of first refusal to purchase
the Shares to be Transferred (the "Offered Shares") on the terms and conditions
set forth in this Section (the "Right of First Refusal").
6.1 Notice of Proposed Transfer. In the event the Holder proposes to
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Transfer any Vested Shares, other than by Involuntary Transfer, the Holder of
the Offered Shares will deliver to the Company a written notice (the "Voluntary
Transfer Notice") stating: (i) the Holder's bona fide intention to Transfer the
Offered Shares; (ii) the name of each proposed bona
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fide purchaser or other transferee (the "Proposed Transferee"); (iii) the number
of Offered Shares to be Transferred to each Proposed Transferee; (iv) the bona
fide cash price or other consideration for which the Holder proposes to Transfer
the Offered Shares (the "Offered Price"); and (v) that the Holder acknowledges
this Voluntary Transfer Notice is an offer to sell the Offered Shares to the
Company and/or its assignee(s) pursuant to the Company's Right of First Refusal
at the Offered Price as provided for in this Agreement. In the event of any
Involuntary Transfer of any Vested Shares, the Holder shall deliver to the
Company a written notice (the "Involuntary Transfer Notice") stating: (i) the
number of Shares subject to the Involuntary Transfer, (ii) the manner,
circumstances and date of the Involuntary Transfer, and (iii) the name and
address of the Holder and transferee. If the Company subsequently requests
additional information concerning the Involuntary Transfer or transferee, Holder
agrees to promptly provide the requested information to the Company.
6.2 Exercise of Right of First Refusal. At any time within thirty
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(30) days after the date of the Voluntary Transfer Notice or the Involuntary
Transfer Notice (either being sometimes referred to herein as the "Notice"), the
Company and/or its assignee(s) may, by giving written notice to the Holder,
elect to purchase all (or, with the consent of the Holder, less than all) the
Offered Shares proposed to be Transferred to any one or more of the Proposed
Transferees named in the Notice, at the purchase price determined as specified
below.
6.3 Purchase Price. The purchase price for the Offered Shares
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purchased under this Section will be the Offered Price. If no price or other
legal consideration is to be paid for the Shares, the Transfer will be referred
to as a "Donative Transfer". If the Offered Price includes consideration other
than cash, then the cash equivalent value of the non-cash consideration shall
conclusively be deemed to be the present fair market value of such non-cash
consideration as conclusively determined in good faith by the Company's Board of
Directors. In the case of a Donative Transfer or Involuntary Transfer, the
Offered Price to be paid to the Holder by the Company or its assignee will be
the fair market value of the Offered Shares on the proposed transfer date, as
conclusively determined in good faith by the Board of Directors of the Company.
6.4 Payment. Payment of the Offered Price will be payable, at the
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option of the Company and/or its assignee(s) (as applicable), by check or by
cancellation of all or a portion of any outstanding indebtedness owed by the
Holder to the Company (or to such assignee, in the case of a purchase of Offered
Shares by such assignee) or by any combination thereof. The Offered Price will
be paid without interest within sixty (60) days after the Company's receipt of
the Notice, or, at the option of the Company and/or its assignee(s), in the
manner and at the time(s) set forth in the Notice.
6.5 Holder's Right to Transfer. If all of the Offered Shares
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proposed in the Notice to be Transferred to a given Proposed Transferee are not
purchased by the Company and/or its assignee(s) as provided in this Section,
then the Holder may Transfer such Offered Shares to that Proposed Transferee at
the Offered Price or at a higher price, provided that (i) such Transfer is
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consummated within one hundred twenty (120) days after the date of the Notice,
(ii) any such Transfer is effected in compliance with all applicable securities
laws, and (iii) the Proposed Transferee agrees in writing that the provisions of
this Section will continue to apply to the Offered Shares in the hands of such
Proposed Transferee. If the Offered Shares described in the Notice are not
Transferred to the Proposed Transferee within such one hundred twenty (120)
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day period, then a new Notice must be given to the Company, pursuant to which
the Company will again be offered the Right of First Refusal before any Shares
held by the Holder may be Transferred.
6.6 Exempt Transfers. Notwithstanding anything to the contrary in
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this Section, the following Transfers of Vested Shares will be exempt from the
Right of First Refusal: (i) the Transfer of any or all of the Vested Shares
during Purchaser's lifetime by gift or on Purchaser's death by will or intestacy
to Purchaser's "Immediate Family" (as defined below) or to a trust for the
benefit of Purchaser or Purchaser's Immediate Family, provided that each
transferee or other recipient agrees in a writing satisfactory to the Company
that the provisions of this Section will continue to apply to the Transferred
Vested Shares in the hands of such transferee or other recipient; (ii) any
Transfer of Vested Shares made pursuant to a statutory merger or statutory
consolidation of the Company with or into another corporation or corporations
(except that the Right of First Refusal will continue to apply thereafter to
such Vested Shares, in which case the surviving corporation of such merger or
consolidation shall succeed to the rights of the Company under this Section
unless the agreement of merger or consolidation expressly otherwise provides);
or (iii) any Transfer of Vested Shares pursuant to the winding up and
dissolution of the Company. As used herein, the term "Immediate Family" will
mean Purchaser's spouse, the lineal descendant or antecedent, father, mother,
brother or sister, child, adopted child or grandchild or adopted grandchild of
Purchaser or Purchaser's spouse, or the spouse of any child, adopted child,
grandchild or adopted grandchild of Purchaser or Purchaser's spouse.
6.7 Termination of Right of First Refusal. The Right of First
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Refusal will terminate as to all Shares on the effective date of the first sale
of Common Stock of the Company to the general public pursuant to a registration
statement filed with and declared effective by the SEC under the 1933 Act (other
than a registration statement relating solely to the issuance of Common Stock
pursuant to a business combination or an employee incentive or benefit plan).
6.8 Encumbrances on Vested Shares. Purchaser may xxxxx x xxxx or
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security interest in, or pledge, hypothecate or encumber Vested Shares only if
each party to whom such lien or security interest is granted, or to whom such
pledge, hypothecation or other encumbrance is made, agrees in a writing
satisfactory to the Company that: (i) such lien, security interest, pledge,
hypothecation or encumbrance will not apply to such Vested Shares after they are
acquired by the Company and/or its assignees under this Section; and (ii) the
provisions of this Section will continue to apply to such Vested Shares in the
hands of such party and any transferee of such party. Purchaser may not xxxxx x
xxxx or security interest in, or pledge, hypothecate or encumber, any Unvested
Shares.
7. RIGHTS AS SHAREHOLDER. Subject to the terms and conditions of this
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Agreement, Purchaser will have all of the rights of a shareholder of the Company
with respect to the Shares from and after the date that Purchaser delivers
payment of the Purchase Price until such time as Purchaser disposes of the
Shares or the Company and/or its assignee(s) exercise(s) the Repurchase Option
or Right of First Refusal. Upon an exercise of the Repurchase Option or the
Right of First Refusal, Purchaser will have no further rights as a holder of the
Shares so purchased upon such exercise, except the right to receive payment for
the Shares so purchased in accordance with the provisions of this Agreement, and
Purchaser will promptly surrender the
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stock certificate(s) evidencing the Shares so purchased to the Company for
transfer or cancellation.
8. ESCROW. As security for Purchaser's faithful performance of this
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Agreement, Purchaser agrees, immediately upon receipt of the stock
certificate(s) evidencing the Shares, to deliver such certificate(s), together
with the Stock Powers executed by Purchaser and by Purchaser's spouse, if any
(with the date and number of Shares left blank), to the Secretary of the Company
or other designee of the Company (the "Escrow Holder"), who is hereby appointed
to hold such certificate(s) and Stock Powers in escrow and to take all such
actions and to effectuate all such transfers and/or releases of such Shares as
are in accordance with the terms of this Agreement. Escrow Holder will act
solely for the Company as its agent and not as a fiduciary. Purchaser and the
Company agree that Escrow Holder will not be liable to any party to this
Agreement (or to any other party) for any actions or omissions unless Escrow
Holder is grossly negligent or intentionally fraudulent in carrying out the
duties of Escrow Holder under this Agreement. Escrow Holder may rely upon any
letter, notice or other document executed with any signature purported to be
genuine and may rely on the advice of counsel and obey any order of any court
with respect to the transactions contemplated by this Agreement. The Shares
will be released from escrow upon termination of the Repurchase Option and the
Right of First Refusal.
9. TAX CONSEQUENCES. PURCHASER UNDERSTANDS THAT PURCHASER MAY SUFFER
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ADVERSE TAX CONSEQUENCES AS A RESULT OF PURCHASER'S PURCHASE OR DISPOSITION OF
THE SHARES. PURCHASER REPRESENTS THAT PURCHASER IS NOT RELYING ON THE COMPANY
FOR ANY TAX ADVICE. Purchaser hereby acknowledges that Purchaser has been
informed that, unless an election is filed by the Purchaser with the Internal
Revenue Service (and, if necessary, the proper state taxing authorities) within
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30 days of the purchase of the Shares to be effective, electing pursuant to
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Section 83(b) of the Internal Revenue Code (and similar state tax provisions, if
applicable) to be taxed currently on any difference between the Purchase Price
of the Shares and their fair market value on the date of purchase, there will be
a recognition of taxable income to the Purchaser, measured by the excess, if
any, of the fair market value of the Shares, at the time they cease to be
Unvested Shares, over the Purchase Price for such Shares. Purchaser represents
that Purchaser has consulted any tax advisors Purchaser deems advisable in
connection with Purchaser's purchase of the Shares and the filing of the
election under Section 83(b) and similar tax provisions. A form of Election
under Section 83(b) is attached hereto as Exhibit 3 for reference. PURCHASER
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HEREBY ASSUMES ALL RESPONSIBILITY FOR FILING SUCH ELECTION AND PAYING ANY TAXES
RESULTING FROM SUCH ELECTION OR FROM FAILURE TO FILE THE ELECTION AND PAYING
TAXES RESULTING FROM THE LAPSE OF THE REPURCHASE RESTRICTIONS ON THE UNVESTED
SHARES.
10. RESTRICTIVE LEGENDS AND STOP-TRANSFER ORDERS.
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10.1 Legends. Purchaser understands and agrees that the Company will
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place the legends set forth below or similar legends on any stock certificate(s)
evidencing the Shares, together with any other legends that may be required by
state or federal securities laws, the Company's Articles of Incorporation or
Bylaws, any other agreement between Purchaser and the Company or any agreement
between Purchaser and any third party:
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THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR UNDER THE
SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES ARE SUBJECT TO
RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED
OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND APPLICABLE STATE
SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM.
INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE
FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN
FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY
PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE ACT AND ANY
APPLICABLE STATE SECURITIES LAWS.
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS ON PUBLIC RESALE AND TRANSFER, INCLUDING THE RIGHTS OF
REPURCHASE AND FIRST REFUSAL HELD BY THE ISSUER AND/OR ITS ASSIGNEE(S)
AS SET FORTH IN A FOUNDER'S RESTRICTED STOCK PURCHASE AGREEMENT
BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF
WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. SUCH
PUBLIC SALE AND TRANSFER RESTRICTIONS, INCLUDING THE RIGHTS OF
REPURCHASE AND FIRST REFUSAL, ARE BINDING ON TRANSFEREES OF THESE
SHARES.
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A 180 DAY
MARKET STANDOFF RESTRICTION AS SET FORTH IN A CERTAIN AGREEMENT
BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF
WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. AS A
RESULT OF SUCH AGREEMENT, THESE SHARES MAY NOT BE TRADED PRIOR TO 180
DAYS AFTER THE EFFECTIVE DATE OF THE INITIAL PUBLIC OFFERING OF THE
COMMON STOCK OF THE ISSUER HEREOF. SUCH RESTRICTION IS BINDING ON
TRANSFEREES OF THESE SHARES.
10.2 Stop-Transfer Instructions. Purchaser agrees that, to ensure
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compliance with the restrictions imposed by this Agreement, the Company may
issue appropriate "stop-transfer" instructions to its transfer agent, if any,
and if the Company transfers its own securities, it may make appropriate
notations to the same effect in its own records.
10.3 Refusal to Transfer. The Company will not be required (i) to
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transfer on its books any Shares 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, or to accord the right to vote or pay dividends, to any
purchaser or other transferee to whom such Shares have been so transferred.
11. MARKET STANDOFF AGREEMENT. Purchaser agrees in connection with any
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registration of the Company's securities under the 1933 Act that, upon the
request of the Company or the underwriters managing any registered public
offering of the Company's securities, Purchaser will not sell, pledge, transfer
or otherwise dispose of any Shares without the prior written consent of the
Company or such underwriters, as the case may be, for such period of
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time (not to exceed one hundred eighty (180) days) after the effective date of
such registration requested by such managing underwriters and subject to all
restrictions as the Company or the managing underwriters may specify for
employee-shareholders generally. Purchaser further agrees to enter into any
agreement reasonably required by the underwriters to implement the foregoing.
12. COMPLIANCE WITH LAWS AND REGULATIONS. The issuance and transfer of
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the Shares will be subject to and conditioned upon compliance by the Company and
Purchaser with all applicable state and federal laws and regulations and with
all applicable requirements of any stock exchange or automated quotation system
on which the Company's Common Stock may be listed or quoted at the time of such
issuance or transfer.
13. GENERAL PROVISIONS.
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13.1 Assignments; Successors and Assigns. The Company may assign any
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of its rights and obligations under this Agreement, including its rights to
repurchase Shares under the Repurchase Option and the Right of First Refusal.
Any assignment of rights and obligations by any other party to this Agreement
requires the Company's prior written consent. This Agreement, and the rights
and obligations of the parties hereunder, will be binding upon and inure to the
benefit of their respective successors, assigns, heirs, executors,
administrators and legal representatives.
13.2 Governing Law. This Agreement will be governed by and construed
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in accordance with the laws of the State of California, without giving effect to
that body of laws pertaining to conflict of laws.
13.3 Notices. Any and all notices required or permitted to be given
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to a party pursuant to the provisions of this Agreement will be in writing and
will be effective and deemed to provide such party sufficient notice under this
Agreement on the earliest of the following: (i) at the time of personal
delivery, if delivery is in person; (ii) at the time of transmission by
facsimile or telecopier, addressed to the other party at its facsimile number or
telecopier address specified herein (or hereafter modified by subsequent notice
to the parties hereto), with confirmation of receipt made by both telephone and
printed confirmation sheet verifying successful transmission of the facsimile;
(iii) one (1) business day after deposit with an express overnight courier for
United States deliveries, or two (2) business days after such deposit for
deliveries outside of the United States; or (iv) three (3) business days after
deposit in the United States mail by registered or certified mail (return
receipt requested) for United States deliveries.
All notices for delivery outside the United States will be sent by
facsimile or by express courier. All notices not delivered personally or by
facsimile will be sent with postage and/or other charges prepaid and properly
addressed to the party to be notified at the address set forth below, or at such
other address as such other party may designate by ten (10) days advance written
notice to the other parties hereto. Notices to the Company will be marked
"Attention: President."
9
To: XxxXxxxxxxxx.xxx To:
000 Xxxxx Xxxxxx, #000
Xxx Xxxxx, XX 00000
Attention to: President
Facsimile: (000) 000-0000
13.4 Further Assurances. The parties agree to execute such further
------------------
documents and instruments and to take such further actions as may be reasonably
necessary to carry out the purposes and intent of this Agreement.
13.5 Titles and Headings. The titles, captions and headings of this
-------------------
Agreement are included for ease of reference only and will be disregarded in
interpreting or construing this Agreement. Unless otherwise specifically
stated, all references herein to "sections" and "exhibits" will mean "sections"
and "exhibits" to this Agreement.
13.6 Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which when so executed and delivered will be deemed an
original, and all of which together shall constitute one and the same agreement.
13.7 Severability. If any provision of this Agreement is determined
------------
by any court or arbitrator of competent jurisdiction to be invalid, illegal or
unenforceable in any respect, such provision will be enforced to the maximum
extent possible given the intent of the parties hereto. If such clause or
provision cannot be so enforced, such provision shall be stricken from this
Agreement and the remainder of this Agreement shall be enforced as if such
invalid, illegal or unenforceable clause or provision had (to the extent not
enforceable) never been contained in this Agreement. Notwithstanding the
forgoing, if the value of this Agreement based upon the substantial benefit of
the bargain for any party is materially impaired, as determined by such party in
its sole discretion, then this Agreement will not be enforceable against such
affected party and both parties agree to renegotiate such provision(s) in good
faith.
13.8 Facsimile Signatures. This Agreement may be executed and
--------------------
delivered by facsimile and upon such delivery the facsimile signature will be
deemed to have the same effect as if the original signature had been delivered
to the other party. The original signature copy shall be delivered to the other
party by express overnight delivery. The failure to deliver the original
signature copy and/or the nonreceipt of the original signature copy shall have
no effect upon the binding and enforceable nature of this Agreement.
13.9 Amendment and Waivers. This Agreement may be amended only by a
---------------------
written agreement executed by each of the parties hereto. No amendment of or
waiver of, or modification of any obligation under this Agreement will be
enforceable unless set forth in a writing signed by the party against which
enforcement is sought. Any amendment effected in accordance with this section
will be binding upon all parties hereto and each of their respective successors
and assigns. No delay or failure to require performance of any provision of
this Agreement shall constitute a waiver of that provision as to that or any
other instance. No waiver granted under this Agreement as to any one provision
herein shall constitute a subsequent waiver of such provision or of any other
provision herein, nor shall it constitute the waiver of any performance other
than the actual performance specifically waived.
10
14. Entire Agreement. This Agreement and the documents referred to herein
----------------
constitute the entire agreement and understanding of the parties with respect to
the subject matter of this Agreement, and supersede all prior understandings and
agreements, whether oral or written, between or among the parties hereto with
respect to the specific subject matter hereof.
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed in
triplicate by its duly authorized representative and Purchaser has executed this
Agreement in triplicate, as of the Effective Date.
COMPANY: PURCHASER:
XXXXXXXXXXXX.XXX
By:____________________________ By:_______________________________
Name:__________________________ Address: 000 Xxxxx Xxxxxx, #000
Xxxxx:________________________ Xxx Xxxxx, XX 00000
Address: 000 Xxxxx Xxxxxx, #000
Xxx Xxxxx, XX 00000 Fax: (000) 000-0000
Fax: (000) 000-0000 Phone: (000) 000-0000
Phone: (000) 000-0000
Signature Page To Founder's Restricted Stock Purchase Agreement
11
LIST OF EXHIBITS
----------------
Exhibit 1: Stock Power and Assignment Separate from Stock Certificate
Exhibit 2: Copy of Purchaser's Check and Assignment Agreement
Exhibit 3: Election Under Section 83(b) of the Internal Revenue Code
12
EXHIBIT 1
---------
STOCK POWER AND ASSIGNMENT
SEPARATE FROM STOCK CERTIFICATE
STOCK POWER AND ASSIGNMENT
SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED and pursuant to that certain Founder's Restricted Stock
Purchase Agreement dated as of April 26, 1999 (the "Agreement"), the undersigned
hereby sells, assigns and transfers unto ______________________________,
__________ shares of the Common Stock of XxxXxxxxxxxx.xxx, a California
corporation (the "Company"), standing in the undersigned's name on the books of
the Company represented by Certificate No(s). ____ delivered herewith, and does
hereby irrevocably constitute and appoint the Secretary of the Company as the
undersigned's attorney-in-fact, with full power of substitution, to transfer
said stock on the books of the Company. THIS ASSIGNMENT MAY ONLY BE USED AS
AUTHORIZED BY THE AGREEMENT AND ANY EXHIBITS THERETO.
Dated: _________________________
PURCHASER
_______________________________________
(Signature)
_______________________________________
(Please Print Name)
_______________________________________
(Spouse's Signature, if any)
_______________________________________
(Please Print Spouse's Name)
Instructions to Purchaser: Please do not fill in any blanks other than the
------------------------- ---
signature line. The purpose of this Stock Power and Assignment is to enable the
Company and/or its assignee(s) to acquire the shares upon exercise of its
"Repurchase Option" and/or "Right of First Refusal" set forth in the Agreement
without requiring additional signatures on the part of the Purchaser or
Purchaser's Spouse, if any.
EXHIBIT 2
---------
COPY OF PURCHASER'S CHECK
AND ASSIGNMENT AGREEMENT
ASSIGNMENT OF TECHNOLOGY AGREEMENT
----------------------------------
This Assignment of Technology Agreement (this "Agreement") is made and
entered into effective as of April 26, 1999 by and between XxxXxxxxxxxx.xxx, a
California corporation (the "Company"), and ____________ (the "Assignor").
R E C I T A L S
- - - - - - - -
A. Assignor is an author/inventor and an owner of the Technology (as
defined below), and Assignor desires to assign and transfer to the Company all
of Assignor's right, title and interest in and to the Technology and other
related rights in connection with the Company's issuance to Assignor of
____________ (_____) shares of the Company's Common Stock (the "Shares").
B. The parties are entering into this Agreement pursuant to that certain
Founder's Restricted Stock Purchase Agreement by and between the Company and
Assignor dated of even date herewith (the "Stock Purchase Agreement").
NOW THEREFORE, the parties hereby agree as follows:
1. Certain Definitions. As used herein, the following terms will have the
-------------------
meanings set forth below:
1.1 Technology. The term "Technology" means the invention, design,
----------
development, prototype, expression or idea creation of (1) an on screen (client)
viewbar (browser) that communicates with a predetermined server supplying
instructions for display of content and a referral payment system to compensate
and encourage existing users to refer potential new users; and (2) all related
business plans, white papers and design documents, and all technology, trade
secrets and know-how related thereto.
1.2 Derivative. The term "Derivative" means: (i) any derivative work
----------
of the Technology (as defined in Section 101 of the U.S. Copyright Act); (ii)
all improvements, modifications, alterations, adaptations, enhancements and new
versions of the Technology (the "Technology Derivatives"); and (iii) all
technology, inventions, products or other items that, directly or indirectly,
incorporate, or are derived from, any part of the Technology or any Technology
Derivative.
1.3 Intellectual Property Rights. The term "Intellectual Property
----------------------------
Rights" means, collectively, all worldwide patents, patent applications, patent
rights, copyrights, copyright registrations, moral rights, trade names,
trademarks, service marks, domain names and registrations and/or applications
for all of the foregoing, trade secrets, know-how, mask work rights, rights in
trade dress and packaging, goodwill and all other intellectual property rights
and proprietary rights relating in any way to the Technology, any Derivative or
any Embodiment, whether arising under the laws of the United States of America
or the laws of any other state, country or jurisdiction.
1
1.4 Embodiment. The term "Embodiment" means all documentation,
----------
drafts, papers, designs, schematics, diagrams, models, prototypes, source and
object code (in any form or format and for all hardware platforms), computer-
stored data, diskettes, manuscripts and other items describing all or any part
of the Technology, any Derivative, any Intellectual Property Rights or any
information related thereto or in which all of any part of the Technology, any
Derivative, any Intellectual Property Right or such information is set forth,
embodied, recorded or stored.
1.5 Assigned Assets. The term "Assigned Assets" refers to the
---------------
Technology, all Derivatives, all Intellectual Property Rights and all
Embodiments, collectively.
2. Assignment. In partial consideration of the issuance by the Company
----------
to Assignor of the Shares, receipt of which is hereby acknowledged, Assignor
hereby forever sells, assigns, transfers, releases and conveys to the Company,
and its successors and assigns, Assignor's entire right, title and interest in
and to each and all of the Assigned Assets.
3. Delivery. Assignor agrees to deliver all Embodiments of all Assigned
--------
Assets to the Company at a location designated by the Company no later than
April 26, 1999.
4. Assignor Representations and Warranties. Assignor represents and
---------------------------------------
warrants to the Company that Assignor is an owner, inventor and/or author of,
and that Assignor can transfer all of his right, title and interest in and to,
each of the Assigned Assets and that none of the Assigned Assets are subject to
any dispute, claim, prior license or other agreement, assignment, lien or rights
of any third party, or any other rights that might interfere with the Company's
use, or exercise of ownership of, any Assigned Assets. Assignor further
represents and warrants to the Company that the Assigned Assets are free of any
claim of any prior employer or third party client of Assignor or any school,
university or other institution Assignor attended, and that Assignor is not
aware of any claims by any third party to any rights of any kind in or to any of
the Assigned Assets. Assignor agrees to immediately notify the Company upon
becoming aware of any such claims.
5. Further Assurances. The parties agree to execute such further
------------------
documents and instruments and to take such further actions as may be reasonably
necessary to carry out the purposes and intent of this Agreement. Assignor
further agrees, promptly upon request of the Company, or any of its successors
or assigns, to execute and deliver, without further compensation of any kind,
any power of attorney, assignment, application for copyright, patent or other
intellectual property right protection, or any other papers which may be
necessary or desirable to fully secure to the Company, its successors and
assigns, all right, title and interest in and to each of the Assigned Assets,
and to cooperate and assist in the prosecution of any opposition proceedings
involving said rights and any adjudication of the same. Further, Assignor
agrees never to assert any claims, rights or moral rights in or to any of the
Assigned Assets.
6. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which when so executed and delivered will be deemed an
original, and all of which together shall constitute one and the same agreement.
7. Governing Law. This Agreement will be governed by and construed in
-------------
accordance with the laws of the State of California, without giving effect to
that body of laws pertaining to conflict of laws.
2
8. Entire Agreement. This Agreement and the documents referred to
----------------
herein, including but not limited to the Stock Purchase Agreement, constitute
the entire agreement and understanding of the parties with respect to the
subject matter of this Agreement, and supersede all prior understandings and
agreements, whether oral or written, between or among the parties hereto with
respect to the specific subject matter hereof.
9. Successors and Assigns; Assignment. Except as otherwise provided in
----------------------------------
this Agreement, this Agreement, and the rights and obligations of the parties
hereunder, will be binding upon an inure to the benefit of their respective
successors, assigns, heirs, executors, administrators and legal representatives.
The Company may assign any of its rights and obligations under this Agreement.
No other party to this Agreement may assign, whether voluntarily or by operation
of law, any of its rights and obligations under this Agreement, except with the
prior written consent of the Company. An assignment by operation of law
includes, without limitation, (i) a merger, reorganization, consolidation or
other transaction in which the shareholders of such party before such merger,
reorganization, consolidation or other transaction own less than fifty percent
(50%) of the outstanding voting equity securities of the surviving corporation,
(ii) a sale or other transfer of all or substantially all of the assets of such
party, or (iii) a transfer of more than fifty percent (50%) of the outstanding
voting equity securities of such party in one transaction or a series of related
transactions.
10. Notices. Any and all notices required or permitted to be given to a
-------
party pursuant to the provisions of this Agreement will be in writing and will
be effective and deemed to provide such party sufficient notice under this
Agreement on the earliest of the following: (i) at the time of personal
delivery, if delivery is in person; (ii) at the time of transmission by
facsimile or telecopier, addressed to the other party at its facsimile number or
telecopier address specified herein (or hereafter modified by subsequent notice
to the parties hereto), with confirmation of receipt made by both telephone and
printed confirmation sheet verifying successful transmission of the facsimile;
(iii) one (1) business day after deposit with an express overnight courier for
United States deliveries, or two (2) business days after such deposit for
deliveries outside of the United States, with proof of delivery from the courier
requested; or (iv) three (3) business days after deposit in the United States
mail by registered or certified mail (return receipt requested) for United
States deliveries.
All notices for delivery outside the United States will be sent by
facsimile or by express courier. All notices not delivered personally or by
facsimile will be sent with postage and/or other charges prepaid and properly
addressed to the party to be notified at the address set forth below, or at such
other address as such other party may designate by ten (10) days advance written
notice to the other parties hereto. Notices to the Company will be marked
"Attention: President."
To: XxxXxxxxxxxx.xxx To:
000 Xxxxx Xxxxxx, #000
Xxx Xxxxx, XX 00000 Facsimile:
Attention to: President
Facsimile: (000) 000-0000
3
11. Titles and Headings. The titles, captions and headings of this
-------------------
Agreement are included for ease of reference only and will be disregarded in
interpreting or construing this Agreement. Unless otherwise specifically
stated, all references herein to "sections" and "exhibits" will mean "sections"
and "exhibits" to this Agreement.
12. Severability. If any provision of this Agreement is determined by any
------------
court or arbitrator of competent jurisdiction to be invalid, illegal or
unenforceable in any respect, such provision will be enforced to the maximum
extent possible given the intent of the parties hereto. If such clause or
provision cannot be so enforced, such provision shall be stricken from this
Agreement and the remainder of this Agreement shall be enforced as if such
invalid, illegal or unenforceable clause or provision had (to the extent not
enforceable) never been contained in this Agreement. Notwithstanding the
forgoing, if the value of this Agreement based upon the substantial benefit of
the bargain for any party is materially impaired, which determination as made by
the presiding court or arbitrator of competent jurisdiction shall be binding,
then this Agreement will not be enforceable against such affected party and both
parties agree to renegotiate such provision(s) in good faith.
13. Amendment and Waivers. This Agreement may be amended only by a
---------------------
written agreement executed by each of the parties hereto. No amendment of or
waiver of, or modification of any obligation under this Agreement will be
enforceable unless set forth in a writing signed by the party against which
enforcement is sought. Any amendment effected in accordance with this section
will be binding upon all parties hereto and each of their respective successors
and assigns. No delay or failure to require performance of any provision of
this Agreement shall constitute a waiver of that provision as to that or any
other instance. No waiver granted under this Agreement as to any one provision
herein shall constitute a subsequent waiver of such provision or of any other
provision herein, nor shall it constitute the waiver of any performance other
than the actual performance specifically waived.
14. Facsimile Signatures. This Agreement may be executed and delivered by
--------------------
facsimile and upon such delivery the facsimile signature will be deemed to have
the same effect as if the original signature had been delivered to the other
party.
[remainder of page intentionally left blank]
4
IN WITNESS WHEREOF, the undersigned have executed this Agreement
effective as of the date and year first above written.
COMPANY: ASSIGNOR:
XXXXXXXXXXXX.XXX
By:_______________________________ By:_________________________________
Name:_____________________________ Address: 000 Xxxxx Xxxxxx, #000
Xxxxx:____________________________ Xxx Xxxxx, XX 00000
Address: 000 Xxxxx Xxxxxx, #000
Xxx Xxxxx, XX 00000 Fax: (000) 000-0000
Fax: (000) 000-0000 Phone: (000) 000-0000
Phone: (000) 000-0000
Signature Page To Assignment of Technology Agreement
5
EXHIBIT 3
---------
ELECTION UNDER SECTION 83(b) OF THE
INTERNAL REVENUE CODE
ELECTION UNDER SECTION 83(b) OF THE
INTERNAL REVENUE CODE
The undersigned Taxpayer hereby elects, pursuant to Section 83(b) of the
Internal Revenue Code, as amended, to include in gross income for the Taxpayer's
current taxable year the excess, if any, of the fair market value of the
property described below at the time of transfer over the amount paid for such
property, as compensation for services.
1. TAXPAYER'S NAME:
TAXPAYER'S ADDRESS: 000 Xxxxx Xxxxxx, 000
Xxx Xxxxx, XX 00000
SOCIAL SECURITY NUMBER:
2. The property with respect to which the election is made is described as
follows: _________ shares of Common Stock of XxxXxxxxxxxx.xxx, a California
corporation (the "Company"), which is Taxpayer's employer or the corporation
for whom the Taxpayer performs services.
3. The date on which the shares were transferred was April 26, 1999 and this
election is made for calendar year 1999.
4. The shares are subject to the following restrictions: The Company may
repurchase all or a portion of the shares at the Taxpayer's original
purchase price under certain conditions at the time of Taxpayer's
termination of employment or services.
5. The fair market value of the shares (without regard to restrictions other
than restrictions which by their terms will never lapse) was $0.004167 per
share at the time of transfer.
6. The amount paid for such shares was $0.004167 per share.
7. The Taxpayer has submitted a copy of this statement to the Company.
THIS ELECTION MUST BE FILED WITH THE INTERNAL REVENUE SERVICE ("IRS"), AT THE
OFFICE WHERE THE TAXPAYER FILES ANNUAL INCOME TAX RETURNS, WITHIN 30 DAYS AFTER
--------------
THE DATE OF TRANSFER OF THE PROPERTY, AND MUST ALSO BE FILED WITH THE TAXPAYER'S
INCOME TAX RETURNS FOR THE CALENDAR YEAR. THE ELECTION CANNOT BE REVOKED
WITHOUT THE CONSENT OF THE IRS.
Dated: ___________________________ ______________________________________
Taxpayer's Signature
