Option No. ________ Option to Purchase
______ shares
STOCK OPTION AGREEMENT
THIS AGREEMENT made as of the ________ day of
______________________, 199_____, between Ion Laser Technology, Inc., a
Utah corporation (the "Company") and _____________________________ (the
"Employee"),
W I T N E S S E T H:
WHEREAS, the Board of Directors of the Company has approved the
issuance of stock options to employees for the purpose of encouraging
employees to improve the Company's productivity and financial strength,
thereby increasing the value of the Company; and
WHEREAS, the Board of Directors of the Company has determined to
grant to the Employee the Option herein provided for;
NOW, THEREFORE, in consideration of the mutual promises contained
herein:
1. Grant of the Option. The Company hereby grants to Employee,
and Employee hereby accepts from the Company, the right and option to
purchase _____ shares (the "Optioned Shares") of its Common Stock
($0.001 par value) (the "Stock") at a price of $___________ per share,
being an amount not less than the fair market value of the Stock on the
date hereof, in accordance with the terms and conditions contained
herein.
2. Option Term. The term of the Option hereby granted shall be
for a period of ten years and 1 month from the date of this Agreement,
or ___________ months from the date the Option becomes exercisable,
whichever time period shall terminate first, subject to earlier
termination as herein provided.
3. Exercise of Option.
a. Vesting Schedule. Employee's right to exercise the
options granted hereunder shall be subject to the following vesting
schedule:
Options to purchase__________ shares of the total number
granted shall be exercisable beginning April 26, 1996;
Options to purchase___________shares of the total number
granted shall be exercisable beginning April 26, 1997;
Options to purchase___________shares of the total number
granted shall be exercisable beginning April 26, 1998;
Options to purchase___________shares of the total number
granted shall be exercisable beginning April 26, 1999;
Options to purchase___________shares of the total number
granted shall be exercisable beginning April 26, 2000.
To the extent Employee does not in any year purchase all or any portion
of the shares Employee is entitled to purchase, Employee has the
cumulative right thereafter to purchase any shares not so purchased, and
such right shall continue until the Option terminates. When the Option
terminates for any reason, no additional shares may be purchased under
this Option.
b. Notice of Exercise and Payment. The Employee, from
time to time during the option period, may purchase shares of Stock to
the extent the Option hereby granted is then exercisable, in whole or in
part, by (i) delivering to the Company a written notice duly signed by
the Employee stating the number of shares that the Employee has elected
to purchase at that time, and (ii) paying or causing to be paid the full
purchase price of the shares then to be purchased in the form of cash,
check, previously acquired shares of Stock of the Company (providing
such use does not violate federal or state securities laws), or any
combination thereof. Shares of Stock tendered as full or partial
payment upon the exercise of an Option shall be accepted in lieu of cash
or check in an amount equivalent to the full fair market value of such
shares on the date of such exercise. No shares shall be issued until
full payment therefore has been made and the Employee shall have none of
the rights of a shareholder in respect of such shares until they are
issued to him.
c. Partial Exercise. If the Employee shall not, at any
particular time of exercise, purchase all of the shares which he is
entitled to purchase at such time, the right to purchase any shares not
then purchased shall continue until the expiration or sooner termination
of the Option granted hereby. This Option shall be exercisable only in
respect of whole shares, and fractional share interests shall be
disregarded except that they may be carried forward in accordance with
the next preceding sentence and accumulated with other fractional
interests. Not less than $250 worth of shares may be purchased at one
time unless a lesser amount is the total amount at the time available
for purchase under the Option, in which case the total Option may be
purchased.
4. Continuation of Employment. In the event that the Employee
is terminated following the grant of this Option and such termination is
for cause on the part of the Employee, this Option, to the extent not
theretofore exercised, shall forthwith terminate. For purposes of the
preceding sentence, the term "cause" shall mean proven or admitted
theft, embezzlement, misappropriation of moneys, or similar dishonesty
which constitutes a violation of the criminal statutes of the State of
Utah, the United States, or any other jurisdiction in which such acts of
dishonesty may occur. Nothing contained in this Agreement shall confer
upon the Employee any right to continue in the employ of the Company or
of any parent or subsidiary corporation of the Company, or interfere in
any way with the right of the Company or any parent or subsidiary
corporation of the Company to establish his rate of compensation at any
time, but nothing contained herein shall affect any other contractual
rights existing between the Employee and the Company.
5. Nontransferability. The Option hereby granted shall not be
transferable by the Employee other than by will or the laws of descent
and distribution, and shall be exercisable during the Employee's
lifetime only by him.
6. Termination of Employment. If the Employee ceases to be
employed by the Company or any parent or subsidiary of the Company for
any reason other than his death, this Option shall, subject to earlier
lapse, expiration, or termination pursuant to Sections 2 or 4 of this
Agreement, expire three months thereafter, and during such period after
Employee ceases to be an employee, this Option shall be exercisable only
as to those shares as to which the Option was exercisable as of the date
of such cessation of employment. Employee specifically agrees to hold
the Company harmless of any damages perceived to have occurred to
Employee by virtue of the provisions of this paragraph, regardless of
the circumstances whatsoever surrounding the termination of Employee's
employment. In the event that the Employee's termination is the result
of a disability as defined in Section 105(d)(4) of the Internal Revenue
Code of 1954, as amended, the three-month period of the foregoing
sentence shall be one year.
7. Death of Employee. If the Employee dies while he is
employed by the Company or any parent or subsidiary of the Company, or
during the three-month or one-year (as the case may be) period referred
to in Section 6 of this Agreement, the Option granted hereby shall,
subject to the earlier lapse, expiration, or termination pursuant to
Sections 2 or 4 of this Agreement, expire one year after the date of
such death, in which case the Option may be exercised pursuant to the
provisions herein by the person or persons to whom the Employee's rights
under the Options shall pass by his will or by the applicable laws of
descent and distribution.
8. Adjustments Upon Changes in Capitalization. If the
outstanding shares of stock of the Company are increased, decreased, or
changed into, or exchanged for, a different number or kind of shares or
securities of the Company through reorganization, merger,
recapitalization, reclassification, stock splitup, stock dividend, stock
consolidation, or other similar event, an appropriate and proportionate
adjustment shall be made in the number and kind of shares or securities
as to which the Option granted hereby, or portion thereof remaining
unexercised, may be exercised. Any such adjustment, however, shall be
made without changing the total price applicable to the unexercised
portion of the Option but by adjusting the price for each share or
security covered by the Option.
Upon the dissolution and liquidation of the Company or upon a
reorganization, merger, or consolidation and/or acquisition of the
Company or any other form of business combination requiring shareholder
approval involving the Company with one or more corporations as a result
of which the Company is not the surviving corporation, or upon a sale of
substantially all of the assets of the Company to another corporation,
the Option granted hereby shall terminate, except if the Option is then
exercisable, it shall remain exercisable pursuant to the terms hereof.
Adjustments under this Section shall be made by the Board of
Directors of the Company or the Committee, whose determination shall be
final, binding, and conclusive. No fractional shares of stock shall be
issued on account of any such adjustment.
9. Purchase for Investment. As a condition to the exercise in
whole or in part of the Option hereby granted, each written notice of
election shall include a representation and warranty in writing to the
Company that the Stock purchased is being acquired for investment and
not with a view to the distribution or resale thereof, unless, at the
time the Option is exercised, in whole or in part, there is in effect
under the Securities Act of 1933 a Registration Statement relating to
the stock issuable upon exercise of this Option and available for
delivery to the Employee a prospectus meeting the requirements of
Section 10(a)(3) of said Act. No Stock shall be purchased upon the
exercise of the Option granted hereby unless and until any then
applicable requirements of the United States Securities and Exchange
Commission, the state(s) having jurisdiction, (and other regulatory
agencies having jurisdiction) and of any exchanges upon which stock of
the Company may be listed or regulatory bodies governing trading
over the counter shall have been fully complied with.
10. Transfer Taxes. The Company shall at all times during the
term of the Option hereby granted reserve and keep available such number
of shares of Stock as will be sufficient to satisfy the requirements of
this Agreement, and shall pay all original issue and transfer taxes with
respect to the issue and transfer of shares pursuant hereto and all
other fees and expenses necessarily incurred by the Company in
connection therewith.
11. Notices. Any notice to be given by the Employee hereunder
shall be sent to the Company at its offices at 0000 Xxxxx Xxxx, Xxxx
Xxxx Xxxx, Xxxx 00000. Any notice from the Company to the Employee
shall be sent to the Employee at_____________________________________
______________________, or his then current place of employment within
the Company. Either party may change the address to which notices are
to be sent by notice in writing given to the other in accordance with
the terms hereof.
12. Fair Market Value of Stock. For purposes of this Agreement,
the fair market value of Stock on any particular date shall be (i) the
closing bid price for the Stock as quoted on the NASDAQ quotation
service of the National Association of Securities Dealers, Inc., or (ii)
the closing sales price for the Stock as quoted on any national
securities exchange, for the immediately preceding day for which such
quotations were made, or if price information for the Stock is not
quoted on the NASDAQ quotation service or on a national securities
exchange, the fair market value of the Stock shall be as determined in
good faith in accordance with regulations of the United States Secretary
of the Treasury relating to the valuation of stock subject to incentive
stock options.
IN WITNESS WHEREOF, the parties have executed this Agreement
effective as of the day and year first above written.
ION LASER TECHNOLOGY, INC. EMPLOYEE
By:___________________________ _____________________________________
Title: ______________________________ Printed Name:________________________
