ROCKETINFO, INC.
CONSULTING AGREEMENT
This CONSULTING AGREEMENT is made and entered into as of August 25,
2006, by and between Xxxxx Xxxxx, (?Consultant?), having a place of
business at 6 Hertford, Xxxxxxx Xxxxx, Xxxxxxxxxx 00000 and Rocketinfo,
Inc., a Delaware corporation (?Rocketinfo?), having a place of business
at 0 Xxxxxx Xxxxxx Xxxxx, Xxxxx 0000, Xxxxx Xxx, Xxxxxxxxxx 00000.
WHEREAS, Consultant is in the business of providing consulting
services; and
WHEREAS, Rocketinfo desires Consultant to provide its consulting
services to Rocketinfo, and Consultant desires to provide such services
to Rocketinfo.
NOW, THEREFORE, the parties hereto agree as follows:
1.0. DEFINITIONS.
1.1. ?Agreement? means this Consulting Agreement.
1.2. ?Confidential Information? means any information of
Rocketinfo, including, but not limited to that regarding Rocketinfo?s
business, customers, employees, marketing, operations, technology,
products and the like, which should reasonably be understood to be non-
public, proprietary and/or confidential in nature.
1.3. ?Consultant? means the individual or independent business
entity identified above and, individually and collectively, the agents,
employees, officers, partners and principals of such individual or
business entity.
1.4. ?Licensed Rights? means any preexisting intellectual property
rights owned and/or licensable by Consultant, its employees or any
third party that are required for Rocketinfo to exercise its rights in
the Work Product or benefit from Services.
1.5. ?Services? means the services to be performed by Consultant
hereunder, which shall be described on Exhibit A hereto.
1.6. ?Work Product? means any and all concepts, data, designs,
ideas, information, inventions, know-how, processes, techniques, and
works of authorship or the like developed or created by Consultant as
it pertains to performing Services, regardless of the form of
embodiment. Work Product shall (i) include all copyrights, patents,
trademarks, trade secrets or other intellectual property rights
associated therewith, and (ii) in the case of copyrights, be considered
(to the extent permitted by law) works made for hire within the meaning
of the Copyright Act (17 U.S.C. section 101 et seq.). Work Product does
not and is not intended to include off the shelf training materials or
training products developed by a trainer or training company for group
or individual learning, regardless of whether the materials or product
are modified for use at Rocketinfo.
1.7 Change of Control; shall mean the occurrence during the term of
this Agreement any of the following events:
(i) An acquisition (other than directly from Rocketinfo) of any
voting securities of Rocketinfo (the ?Voting Securities?) by any
?Person? (as the term person is used for purposes of Section
13(d) or 14(d) of the Securities Exchange Act of 1934 (the ?1934
Act?)) immediately after which such Person has ?Beneficial
Ownership? (within the meaning of Rule 13d-3 promulgated under
the 0000 Xxx) of 40% or more of the combined voting power of
Rocketinfo?s then outstanding Voting Securities; provided,
however, that in determining whether a Change in Control has
occurred, Voting Securities which are acquired in a ?Non-Control
Acquisition? (as hereinafter defined) shall not constitute an
acquisition which would cause a Change in Control. A ?Non-Control
Acquisition? shall mean an acquisition by (1) an employee benefit
plan (or a trust forming a part thereof) maintained by (x)
Rocketinfo or (y) any corporation or other Person of which a
majority of its voting power or its equity securities or equity
interest is owned directly or indirectly by Rocketinfo (a
?Subsidiary?), (2) Rocketinfo or any Subsidiary, or (3) any
Person in connection with a ?Non-Control Transaction? (as
hereinafter defined).
(ii) The individuals who, as of the date of this Agreement, are
members of the Board of Directors of Rocketinfo (the ?Incumbent
Board?) cease for any reason to constitute at least a majority of
the Board of Directors; provided, however, that if the election,
or nomination for election by Rocketinfo?s shareholders, of any
new director was approved by a vote of at least a majority of the
Incumbent Board, such new director shall, for purposes of this
Agreement, be considered as a member of the Incumbent Board;
provided, further, however, that no individual shall be
considered a member of the Incumbent Board if such individual
initially assumed office as a result of either an actual or
threatened ?Election Contest? (as described in Rule 14a-11
promulgated under the 0000 Xxx) or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person
other than the Board of Directors (a ?Proxy Contest?) including a
reason of any agreement intended to avoid or settle any Election
Contest or Proxy Contest; or
(iii) Approval by shareholders of Rocketinfo of:
i. A merger, consolidation or reorganization involving
Rocketinfo, unless
1. the shareholders of Rocketinfo, immediately
before such merger, consolidation or reorganization,
at least a majority of the combined voting power of
the outstanding voting securities of the corporation
resulting from such merger or consolidation or
reorganization (the ?Surviving Corporation?) in
substantially the same proportion as their ownership
of the Voting Securities immediately before such
merger, consolidation or reorganization, and
2. the individuals who were members of the Incumbent
Board immediately prior to the execution of the
agreement providing for such merger, consolidation or
reorganization constitute at least a majority of the
members of the board of directors of the Surviving
Corporation.
3. A liquidation or dissolution of Rocketinfo; or
4. An agreement for the sale or other disposition of
all or substantially all of the business or assets of
Rocketinfo to any Person (other than a transfer to a
Subsidiary); or
5. A change in the Chief Executive Officer of
Rocketinfo from the person in that position on the
date that this Agreement is executed.
(iv) Notwithstanding anything contained in this Agreement to the
contrary, if Messrs. Xxxxx or RBH Consulting?s respective
Consulting Agreement is terminated prior to a Change in Control
and Messrs. Xxxxx or RBH Consulting Inc., reasonably demonstrates
that such termination (1) was at the request of a third party who
has indicated an intention or taken steps reasonably calculated
to effect a Change in Control and who effectuates a Change in
Control (a ?Third Party?) or (2) otherwise occurred in connection
with, or in anticipation of, a Change in Control which actually
occurs, then for all purposes of this Agreement, the date of a
Change in Control shall mean the date immediately prior to the
date of such termination of the Messrs. Xxxxx or RBH Consulting?s
Consulting Agreement.
Counterparts: This Agreement may be executed in several counterparts,
each of which will be deemed to be an original and all of which will
together constitute one and the same instrument.
2.0. INDEPENDENT CONTRACTOR STATUS. The parties acknowledge and agree
that Consultant is an independent contractor and not an employee,
agent, joint venturer or partner of Rocketinfo. Consultant acknowledges
and agrees that, as an independent contractor, Consultant will not be
entitled to (i) make a claim for unemployment, worker?s compensation or
disability, or (ii) receive any vacation, health, retirement or other
benefits, pursuant to this Agreement or Consultant?s relationship with
Rocketinfo. Rocketinfo will not make state or federal unemployment
insurance contributions on behalf of Consultant, or withhold FICA
(Social Security) contributions or state and federal income taxes from
its payments to Consultant. Consultant agrees that it shall make such
contributions and withhold such taxes for any of its employees
performing Services. Consultant?s Federal taxpayer identification
number is ###-##-####.
3.0. PERFORMANCE OF SERVICES.
3.1. Services; Progress Reports. Consultant shall perform such
duties as a consultant as may be, from time to time, reasonably
delegated or assigned to him by the Board of Directors of Rocketinfo
consistent with the Consultant's abilities. Consultant agrees to
provide the Services to Rocketinfo, and to promptly deliver to
Rocketinfo any Work Product resulting from the performance of Services.
Consultant will report its progress on its performance of Services to
Rocketinfo at the time and in the manner reasonably requested by
Rocketinfo.
3.2. Devotion of Time. Consultant will determine the general
method, details and means of performing the Services, provided that
Consultant shall strictly observe any Rocketinfo policies or procedures
applicable to the workplace if using the premises and/or equipment of
Rocketinfo. During the Consulting Period, the Consultant shall expend
sufficient time during his working time to meet the corporate
objectives as assigned to him for Rocketinfo?s Board; shall devote his
best efforts, energy and skill to the services of Rocketinfo and the
promotion of its interests; and shall not take part in activities
detrimental to the best interests of Rocketinfo. Nothing in this
Agreement shall preclude the Consultant during the term of this
Agreement from engaging, directly or indirectly, in any business
activity which is not competitive with the then existing business of
Rocketinfo and Consultant shall be permitted to spend portions of his
working time and best efforts, energy and skill as is necessary to
fulfill his duties as an officer, director or employee of Rocketinfo.
4.0. COMPENSATION; EXPENSES; INVOICES AND PAYMENT.
4.1. Signing Bonus. Rocketinfo shall pay the Consultant, on or
prior to the Effective Date, a signing bonus of 1,600,000 share
purchase warrants (the ?Warrants?). Each whole Warrant is exercisable
for one share of common stock of Rocketinfo at an exercise price of US$
0.10 per share at any time from the date of issuance and to the second
anniversary date from the date of issuance. The warrants may be
exercised in whole or in part, subject to the terms and conditions as
set forth in the warrant agreement and attached warrant certificate
between Rocketinfo and the Consultant (the "Warrant Agreement"). The
Warrant Agreement, a copy of which is attached hereto as Exhibit "D"
and which is hereby incorporated herein in its entirety by this
reference, shall be executed contemporaneously with this Agreement
The Warrants and underlying shares of common stock will not have been
registered under the US Securities Act of 1933, as amended, or any
state securities law by reason of specific exemptions under the
provisions thereof which depend in part upon the representations and
warranties made by the Consultant to Rocketinfo. Consultant understands
that the Warrants and underlying shares of common stock of Rocketinfo
to be received by Consultant will be "restricted securities" under
applicable federal securities laws.
4.2. Monthly Fees. As compensation for services rendered by the
Consultant during the term of this Agreement, Rocketinfo shall,
commencing August 1, 2006, pay the Consultant a monthly fee of $10,000
per month. This amount will be adjusted to $20,000 per month when
Rocketinfo has raised US$250,000 in any form of funding (the ?$250,000
Funding?) and the initial $10,000 per month fee will be adjusted on a
per diem basis from the $250,000 Funding Date to the new rate of
$20,000 per month. The $250,000 Funding Date is expected to occur on
or before September 1, 2006.
4.3. Stock Options. As additional compensation for services
rendered by the Consultant under this Agreement, Rocketinfo shall grant
the Consultant the right and option to purchase 3,000,000 shares of
Common Stock of Rocketinfo at $0.20 per share, subject to the terms and
conditions Rocketinfo's Stock-Based Incentive Compensation Plan or such
other stock option plan as the Board of Directors of Rocketinfo may
designate, and as set forth in the Stock Option Agreement between
Rocketinfo and the Consultant (the "Option Agreement"). The Option
Agreement, a copy of which is attached hereto as Exhibit "E" and which
is hereby incorporated herein in its entirety by this reference, shall
be executed contemporaneously with this Agreement.
4.4. Expenses. Rocketinfo shall reimburse the Consultant for all
reasonable and necessary business expenses incurred by him in the
performance of his duties hereunder, in accordance with its policies,
and provided they are vouchered in a form satisfactory to the United
States Internal Revenue Service and consistent with Rocketinfo's policy
for the deduction of such expenses.
4.5. Invoices and Payment. Rocketinfo will pay Consultant for
Services on the 1st and 15th of each month as stated in section 4.2.
Consultant will be reimbursed his business expenses provided that
Consultant submits detailed information for Rocketinfo to verify all
invoice items. Rocketinfo will not be liable for and will not pay any
invoices for expenses that Consultant submits to Rocketinfo more than
ninety (90) days after Consultant incurred these expenses. Consultant
is hereby authorized to apply for a corporate credit card for
Rocketinfo.
5.0. CONFIDENTIAL INFORMATION.
5.1. Confidential Information. Consultant shall maintain in strict
confidence all Confidential Information that Consultant receives in the
course of providing Services or otherwise in connection with its
relationship with Rocketinfo, and shall use Confidential Information
only for the specific purposes of performing Consultant's obligations
hereunder, and to comply in all respects with federal securities and
other applicable laws with respect to Confidential Information.
5.2. Exclusions. The restrictions in Section 5.1 above shall not
apply to information that Consultant can clearly show (i) was already
lawfully known to Consultant; (ii) was independently developed by
Consultant; (iii) becomes rightfully known to Consultant from another
source, without restriction on subsequent disclosure or use; or (iv) is
or becomes part of the public domain through no wrongful act of
Consultant.
6.0. OWNERSHIP OF WORK PRODUCT; LICENSED AND RESIDUAL RIGHTS.
6.1. Ownership of Work Product. Consultant agrees that, in
consideration for Rocketinfo's payment to Consultant hereunder,
Consultant agrees to assign on an exclusive basis all of Consultant's
right, title and interest in and to the Work Product to Rocketinfo.
Accordingly, Consultant agrees that it shall (i) not use any Work
Product for the benefit of any party other than Rocketinfo, (ii)
execute an assignment agreement in the form attached hereto as Exhibit
B on completion of Services, and (iii) perform such other acts
(including, but not limited to, cooperating with and assisting
Rocketinfo in the protection and enforcement of Rocketinfo 's rights in
the Work Product, by adjudication or otherwise) and execute such other
documents and instruments as Rocketinfo may now or hereafter deem
reasonably necessary or desirable to evidence the transfer of sole
ownership of all Work Product to Rocketinfo. If, by operation of law,
Consultant is deemed to retain any rights in and to any intellectual
property created hereunder, Consultant, to the extent that any such
rights conflict with any assignment of rights made by Consultant to
Rocketinfo hereunder, hereby waives all such rights.
6.2. Licensed Rights. To the extent Licensed Rights are required
under this Agreement, Consultant grants or will cause to be granted to
Rocketinfo before the expiration of the term hereof a fully-paid,
irrevocable, worldwide, non-exclusive license and right to make, have
made, sell, possess, use, disclose, reproduce, prepare derivative works
based on, distribute, perform and display works, products or the like
that incorporate or are based on, in whole or in part, Licensed Rights,
Consultant represents that there shall be no Licensed Rights required
hereunder unless specifically noted and described on Exhibit ?D?.
6.3. Residual Rights of Consultant. Notwithstanding anything to the
contrary herein, Consultant shall be free to use its general skills,
know-how and expertise in the course of providing its services to
others, provided that Consultant shall not specifically disclose any
Confidential Information and/or provide Work Product to any third party
in so doing.
7.0. WARRANTIES.
7.1. Warranties. Consultant represents and warrants to Rocketinfo
that:
a. General. Consultant has all requisite right and authority to
enter into this Agreement, and the performance of its obligations
hereunder will not conflict with any of its agreements with or
obligations to any third party.
b. Independent Contractor. Consultant will establish and
maintain its status as an independent contractor by participating in
Rocketinfo 's independent contractor evaluation and scoring process
from time to time as specified by Rocketinfo.
c. Performance of Services. Consultant will perform all Services
in a good and workmanlike manner, in accordance with the best practices
of Consultant's industry, and the Services and Work Product will
conform to the applicable specification and/or statement of work set
forth herein.
d. Intellectual Property Rights. The Work Product, Licensed
Material and any associated deliverables shall not violate any patent,
copyright, trademark, trade secret or other intellectual property right
of any third party.
7.2. Warranty Exclusions. THE FOREGOING WARRANTIES ARE EXCLUSIVE,
AND CONSULTANT DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IPLIED,
INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE.
8.0. EMPLOYMENT AGREEMENT. Rocketinfo Inc. and Xxxxx Xxxxx agree that
this Agreement will be converted into an employment agreement when
Rocketinfo has raised US$2,500,000 in private placement funding. The
terms of the Agreement will be amended where required to conform to the
terms of employment outlined in this Exhibit ?B?.
9.0. INDEMNIFICATION.
9.1 Consultant?s Indemnification of Rocketinfo. Consultant shall
indemnify, defend and hold Rocketinfo harmless from and against any and
all third party claims, suits, proceedings, damages, costs, liabilities
and expenses (including, without limitation, reasonable attorneys'
fees) arising from the negligence or willful misconduct of Consultant
in connection with Consultant's performance of Services or relationship
with Rocketinfo hereunder. The foregoing indemnification shall also
apply to damage or loss to the property of Rocketinfo arising from the
actions or inactions of Consultant's employees or agents, whether in
the course of their employment or not, including but not limited to
acts of theft, vandalism or the like.
9.2 Rocketinfo?s Indemnification of Consultant. Rocketinfo hereby
agrees to indemnify and hold Consultant harmless from any and all
liabilities incurred by Consultant under the Securities Act of 1933, as
amended (the "Act"), the various state securities acts, or otherwise,
insofar as such liabilities arise out of or are based upon (i) any
material misstatement or omission contained in any offering documents
provided by Rocketinfo, or (ii) any intentional actions by Rocketinfo,
direct or indirect, in connection with any offering by Rocketinfo, in
violation of any applicable federal or state securities laws or
regulations. Furthermore, Rocketinfo agrees to reimburse Consultant for
any legal or other expenses incurred by Consultant in connection with
investigating or defending any action, proceeding, investigation, or
claim in connection herewith. The indemnity obligations of Rocketinfo
under this paragraph shall extend to the shareholders, directors,
officers, employees, agents, and control persons of Consultant.
9.3 Binding. The indemnity obligations of the parties under this
Article 9 shall be binding upon and inure to the benefit of any
successors, assigns, heirs, and personal representatives of the
Company, the Consultant, and any other such persons or entities
mentioned hereinabove.
10.0. TERM; TERMINATION.
10.1. Term. This Agreement will become effective August 1, 2006 and
will continue in effect through December 31, 2009, unless terminated
earlier in accordance with this Section 10. This Agreement may be
renewed or extended for any period as may be agreed by the parties.
10.2. Termination of Services and/or Agreement for Convenience by
Rocketinfo. Rocketinfo may terminate this Agreement by giving written
notice to Consultant. On receipt of such notice, Consultant shall
cease providing Services, advise Rocketinfo of the extent to which
Consultant has completed, and collect and deliver to Rocketinfo
whatever Work Product then exists, regardless of the form of
embodiment, in the manner requested by Rocketinfo. After Rocketinfo
receives and accepts Consultant?s detailed statement of any
termination-related expenses and costs incurred by Consultant,
Rocketinfo shall make a final settlement payment to Consultant for all
work performed through the date of such termination within thirty (30)
days.
10.3. Termination of Services and/or Agreement for Convenience by
Consultant. Consultant may terminate this Agreement by giving written
notice to Rocketinfo. On delivery of such notice, Consultant shall
cease providing Services, advise Rocketinfo of the extent to which
Consultant has completed, and collect and deliver to Rocketinfo
whatever Work Product then exists, regardless of the form of
embodiment, in the manner requested by Rocketinfo. After Rocketinfo
receives and accepts Consultant?s detailed statement of any
termination-related expenses and costs incurred by Consultant,
Rocketinfo shall make a final settlement payment to Consultant for all
work performed through the date of such termination within thirty (30)
days.
10.4. Termination of Agreement for Default. If a party fails to
cure any breach of its obligations hereunder within ten (10) days after
its receipt of written notice thereof from the other party, then the
other party may terminate this Agreement at any time thereafter by
providing the defaulting party with written notice of termination.
10.5. Delivery Of Materials Upon Termination. Consultant agrees,
covenants and promises that, in the event of termination or expiration
of this Agreement for any reason, Consultant will promptly and without
request surrender and deliver to Rocketinfo all materials containing,
embodying or otherwise evidencing any Confidential Information,
regardless of whether any such item or the information therein was
prepared, produced or authored by Consultant, except that Consultant
may retain a copy of this Agreement for its records.
10.6 Non-Competition. Consultant acknowledges that services to be
provided give him the opportunity to have special knowledge of
Rocketinfo and of its affiliates and subsidiaries (the "Company Group")
and their confidential information as set out in Article 5 of this
Agreement and the capabilities of the individuals employed by or
affiliated with Rocketinfo and that interference in these relationships
would cause irreparable injury to Rocketinfo. In consideration of this
Agreement, the Consultant covenants and agrees that for a period of one
(1) year from termination, the Consultant will not, without the express
written approval of the Board of Directors directly or indirectly, in
one or a series of transactions, or enter into any agreement to, own,
manage, operate, control, or otherwise engage or participate in,
whether as a proprietor, partner, lender, director, officer, employee,
joint venturer, lessor, agent, representative or other participant, in
any business which competes with Rocketinfo, provided, however, that
Consultant may in one or a series of transactions, own, invest or
acquire an interest in up to five percent (5%) of the capital stock of
another corporation whose capital stock is traded publicly. Consultant
acknowledges that the terms of this Section 10.5 are reasonable and
necessary for the protection of Rocketinfo, and that the scope and term
of this Section 10.5 would not preclude Consultant from earning a
living with an entity that does not compete with Rocketinfo.
10.7. Survival. Sections 5,6,7,10.5, 10.6, 11, 12.1,12.2 and 12.8
hereof shall survive the expiration of earlier termination of this
Agreement.
11.0. EXPORT CONTROL REGULATIONS AND DEEMED EXPORTS
11.1. Consultant will not directly or indirectly transmit, by way
of transshipment, export, re-export diversion or otherwise, any Work
Product or Confidential Information to any destination or location
outside the United States except as authorized by Rocketinfo and in
accordance with the U.S. export control laws and regulations.
11.2. Consultant acknowledges that the export control laws may
apply to the disclosure or release of certain technology and software
to a foreign national located in the United States, and that Consultant
will not release to any unprotected foreign national any Work Product
or Confidential Information except as authorized by Rocketinfo and in
accordance with U.S. export control laws and regulations.
11.3. In order to comply with U.S. export control laws and
regulations, Consultant agrees that it will not assign any unprotected
foreign national to work on Rocketinfo projects unless Consultant has:
(i) identified the unprotected foreign national to Rocketinfo; (ii)
provided Rocketinfo with all information necessary for Rocketinfo to
make an export licensing determination; and, (3) has received from
Rocketinfo permission to assign such unprotected foreign national to
Rocketinfo?s work. ?Unprotected foreign national? shall mean a person
who is not a protected individual under the immigration and
Naturalization Act ("INA") (8 U.S.C. sec. 1324b(a)(3)), Protected
individuals generally include U.S. citizens, U.S. nationals, lawful
permanent residents, lawful temporary residents, refugees and asylees.
Possession of a valid work visa does not necessarily confer protected
individual status on an individual.
12.0. GENERAL.
12.1. Resolution of Disputes. The parties agree that they will
make good faith efforts to settle any dispute, claim or controversy
arising out of or relating to this Agreement by discussion, negotiation
and/or mediation.
12.2. Governing Law; Venue, Waiver of Jury Trial. This Agreement
shall be governed by and interpreted in accordance with the laws of the
State of California, excluding its choice of law rules. Any
adjudicated dispute regarding the interpretation or validity of or
otherwise arising out of this Agreement, or relating to Services
provided under this Agreement, shall be subject to the exclusive
jurisdiction of the California state courts in and for Orange County,
California (or, if there is federal jurisdiction, the U.S. District
Court for the Southern District of California), and Rocketinfo and
Consultant agree to submit to the personal and exclusive jurisdiction
and venue of these courts. The parties hereto expressly waive any
right they have to a jury trial and agree that any court proceeding
under this Agreement shall be tried by a judge without a jury.
12.3. Non-exclusive Relationship. This Agreement is non-
exclusive. Consultant shall have the right to perform work for others
during the term of this Agreement. Rocketinfo may cause similar work
to be performed by its own personnel or other contractors or
consultants during the term of this Agreement.
12.4. Record Keeping. Consultant agrees to keep records regarding
its performance of Services and invoices to Rocketinfo for a period of
at least three (3) years after the expiration or termination of this
Agreement, and that it shall produce such records for inspection and
audit by Rocketinfo on Rocketinfo?s written request.
12.5. Representation by Counsel. Consultant herby certifies and
represents that it has been, or had the opportunity to be, represented
by counsel in the negotiation of this Agreement.
12.6. Assignment. No portion of this Agreement or any of
Consultant?s rights (including, without limitation, the right to
payment hereunder) duties or obligations hereunder may be assigned
and/or delegated by Consultant.
12.7. Modifications. Any modifications of this Agreement shall be
in writing and signed by both parties.
12.8. Complete Agreement. This Agreement, including all
attachments hereto, constitutes the complete and exclusive statement of
the agreement between Rocketinfo and Consultant, and it supersedes all
proposals, oral or written, and all other communications between
Rocketinfo and Consultant relating to the subject matter of this
Agreement.
..
13.0 Voluntary Pooling Agreement: Within 10 days from executing
this agreement the Consultant agrees to enter into a Voluntary Pooling
agreement with certain third parties.
ROCKETINFO, INC. CONSULTANT
By: By:
Xxxxx Xxxxx
NAME (PRINT OR TYPE) NAME (PRINT OR TYPE)
EXHIBIT ?A?
DESCRIPTION OF SERVICES
Description of Services and Work Product
During the term of this Agreement, the Consultant agrees to hold the
executive officer, non-employee position of President and Chief
Executive Officer of Rocketinfo and agrees to serve as a member of the
Board of Directors of Rocketinfo.
Specifically, but not exclusively, your duties and responsibilities
will be:
(a) to preside at all meetings of the Board and stockholders;
(b) to create such committees of the Board as you deem prudent and
advisable for the management of Rocketinfo, to designate the
membership of such Board committees and to designate the powers of
the Board that such committees shall have and may exercise in the
management of the affairs of Rocketinfo, in each case subject to the
approval of the full Board;
(c) to nominate, in consultation with the President & Chairman of
Rocketinfo, the two next successive qualified additional members:
(i) for election to the Board by the Board prior to the next
Annual Meeting of Stockholders, or
(ii) for nomination by the Board for election to the Board at
the next Annual Meeting of Stockholders, or
(iii) for election to the Board by the Board subsequent to
the next Annual Meeting of Stockholders but prior to the
Annual Meeting of Stockholders in May, 2007, such nominees to
be so elected or nominated by the Board unless the Board
reasonably determines that such nominees are not qualified to
serve as members of the Board;
(c) to provide strategic guidance and advice to the senior
management of Rocketinfo with respect to the management of the
operations of Rocketinfo; and
(d) to provide support and guidance to the senior management of
Rocketinfo in their efforts:
(i) to manage and direct the strategic development and
implementation of Rocketinfo's business plan, and
(ii) to assist in the securing, promote and maintain the
appropriate financing and capital structure of Rocketinfo.
You will report directly to and serve at the discretion of the Board.
EXHIBIT ?B?
EMPLOYMENT TERM, COMPENSATION AND BENEFITS
OF
XXXXX XXXXX, PRESIDENT AND CEO ROCKETINFO, INC.
Rocketinfo Inc. and Xxxxx Xxxxx will enter into an employment agreement
which will replace the consulting agreement to which this Exhibit ?B?
is annexed and incorporated (?Agreement?) when Rocketinfo has raised
US$2,500,000 in equity or debt funding. The terms of the Agreement
will be amended where required to conform to the terms of employment
outlined in this Exhibit ?B?.
1. Term.
The term of employment shall commence on completion of Rocketinfo
raising US$2,500,000 in equity or debt financing (the ?Financing Date?)
and shall terminate on December 31, 2009, unless renewed in accordance
with Section 2.1 of the Agreement or terminated prior thereto in
accordance with Section 10.2, 10.3 or 10.4 of the Agreement.
2. Compensation.
a. Base Salary. During the term of the Agreement you will be paid
an minimum annual Base Fee based as follows, or as my be determined
by the compensation committee of Rocketinfo:
PERIOD ANNUAL BASE SALARY
Financing Date through
December 31, 2006 $240,000
January 1, 2007 through
December 31, 2007 $240,000
January 1, 2008 through
December 31, 2008 $240,000
January 1, 2009 through
December 31, 2009 $240,000
b. On signing the Consulting Agreement, you will receive the right
to purchase at your discretion 1,600,000 warrants exercisable into
Common Stock of Rocketinfo at US$ 0.10 per share and 3,000,000
Director?s Stock Options exercisable at US$ 0.20 per share.
c. Performance Bonuses. You will have the opportunity to earn
performance bonuses during second, third and fourth fiscal years of
the Agreement, in an amount to be determined by the independent
members of the Board of Directors.
d. Payment of Base Salary. Base Salary and Bonuses shall be payable
in accordance with Rocketinfo's payroll policies.
3. Vacation.
You shall be paid for and be entitled to all legal and religious
holidays and three weeks paid vacation in the first year and four weeks
per annum, commencing the first year of the Agreement; provided,
however, you may not take more than two weeks of vacation at a time.
All vacation time shall be earned at each time of payroll. You shall
arrange for vacations in advance and at such time or times as shall be
mutually agreeable to you and Rocketinfo. You shall be entitled to
carry forward into the subsequent year up to one (1) week of unused
vacation time. You do not have the right to receive pay in lieu of
vacation.
4. Insurance and Benefits.
Rocketinfo, at its expense, shall provide you with the following
benefits in the same amounts and manner as provided to the members of
Rocketinfo's senior management:
a. health insurance; and
b. a cell phone and cell phone account.
5. Expenses.
Rocketinfo shall reimburse you promptly for all reasonable and ordinary
business and out-of-pocket expenses incurred by you in connection with
Rocketinfo's business and in the scope of your employment hereunder, as
approved by Rocketinfo, including, without limitation, reasonable and
necessary travel, lodging, entertainment and meals incurred by you
during the term of the Agreement, provided the expenses are incurred in
furtherance of Rocketinfo's business and at the request of Rocketinfo.
You agree to keep and maintain records of the aforesaid expenses as may
be requested by Rocketinfo and to account to Rocketinfo for the
expenses prior to reimbursement. Rocketinfo also agrees to apply for a
corporate credit card for use by executive employees. Rocketinfo will
not be liable for and will not pay any invoices for expenses that
Consultant submits to Rocketinfo more than ninety (90) days after
Consultant incurred these expenses. Consultant is hereby authorized to
apply for a corporate credit card for Rocketinfo.
6. Stock Option.
Pursuant to the terms of Rocketinfo's 2006 Equity Incentive Plan (the
"2006 Stock Option Plan"), upon the execution of the Agreement,
Rocketinfo shall grant to you a five year option (such option is a
"non-qualified stock option" as defined in Section 422 of the Internal
Revenue Code of 1986, as amended) to purchase up to three million
(3,000,000) shares of Rocketinfo's common stock at an exercise price
equal to $0.20 per share, which option shall vest immediately.
The complete terms and conditions of this award shall be set forth in
the Option Agreement delivered to you simultaneous herewith. Any
conflict between the terms of the Option Agreement and the Agreement
shall be governed by the Option Agreement.
In the event of the termination of your employment caused by your
resignation, your dismissal with or without Cause (as defined herein),
your disability or your death, or in the event of a change in control
as defined in Rocketinfo?s 2006 Stock Option Plan, your rights in the
options shall be as set forth in Rocketinfo?s 2006 Stock Option Plan.
7. Compensation Upon Termination of Employment.
a. With Cause. If your employment hereunder is terminated by
Rocketinfo for cause or with good reason, the Company's sole
obligation hereunder shall be you the following amounts earned
hereunderbut not paid as of the termination date (collectively,
"Accrued Compensation"):
(i) Base Salary through the termination date;
(ii) any other compensation which has been earned, accrued or
is owing, under the terms of the applicable plan, program or
practice, to the you as of the termination date but not paid,
including, without limitation, any incentive awards under any
bonus plans adopted by Rocketinfo;
(iii) any amounts which you had previously deferred (including
any interest earned or credited thereon);
(iv) reimbursement of any and all reasonable expenses incurred
in connection with your duties and responsibilities under this
Agreement in accordance with policies established by the Board
of Directors of Rocketinfo from time to time and upon receipt
of appropriate documentation; and
(v) other or additional benefits and entitlements in
accordance with any applicable plans, programs and
arrangements of Rocketinfo.
No severance will be paid by to you by Rocketinfo.
a. Without Cause or for Good Reason. If your employment hereunder
is terminated by Rocketinfo without Cause or Good Reason,
Rocketinfo's sole obligation hereunder shall be as follows:
(i) Rocketinfo shall pay your all Accrued Compensation;
(ii) Rocketinfo shall pay you within 30 calendar days in a
lump sum, your Base Salary for a period six months if
terminated in the first year of this Agreement and your Base
Salary for one year following the termination date if
terminated anytime after the after the first year of this
Agreement;
b. Release. In exchange for the payment by Rocketinfo of the
amounts contemplated by Subsections 7(a) or 7(b) of this Agreement,
you agree to execute such form of release as is mutually acceptable
to Rocketinfo and you.
8. Directors and Officers Insurance.
Rocketinfo will use its best efforts to obtain directors and officers
insurance within three months of signing the Agreement.
INITIALS:
Xxxxx Xxxxx: __________
Rocketinfo, Inc.: ________
EXHIBIT ?C?
ASSIGNMENT OF INTELLECTUAL PROPERTY RIGHTS
This ASSIGNMENT OF INTELLECTUAL PROPERTY RIGHTS ("Assignment") is made
and entered into this 25th day of August 2006, by and between Xx. Xxxxx
Xxxxx ("Consultant") and Rocketinfo, Inc. ("Rocketinfo").
Consultant and Rocketinfo have entered into a Consulting Agreement (the
"Agreement") of even date herewith pursuant to which Consultant has
agreed to provide Services and/or create certain Work Product for
Rocketinfo. Unless otherwise defined herein, the defined terms used in
this Assignment shall have the same meanings as set forth in the
Agreement.
1.0. DESCRIPTION OF WORK PRODUCT. Work Product consists of and is as
outlined in Agreement.
2.0. ASSIGNMENT AND TRANSFER OF INTELLECTUAL PROPERTY RIGHTS. In
consideration of Rocketinfo's obligation to pay Consultant the
compensation described in the Agreement, Consultant hereby grants,
assigns, conveys and transfers, and agrees to grant, assign, convey and
transfer from time to time, on an exclusive basis, to Rocketinfo all of
Consultant's right, title and interest in and to all Work Product now
or hereafter created or developed by Consultant as it pertains to
performing the Services, without the necessity of further
consideration. This Assignment shall be operative with respect to all
intellectual property rights in and to all Work Product, including,
without limitation, (i) all copyrights worldwide, including all rights
of registration and publication, rights to create derivative works, and
all other rights incident to copyright ownership, for the residue now
unexpired of the present term of any and all such copyrights and any
term thereafter during which the Work Product shall be entitled to
copyright, and (ii) all trade secrets, inventions, know-how, ideas and
confidential information embodied or reflected in Work Product, for the
longest period of protection accorded to such interests under
applicable law. This Assignment shall be binding upon and inure to the
benefit of the parties hereto and their respective successors, assigns
and legal representatives.
Consultant (by/date)
Rocketinfo (by/date)
EXHIBIT ?D?
WARRANT AGREEMENT
WARRANT AGREEMENT
between
ROCKETINFO, INC.
and
COMPUTERSHARE TRUST COMPANY, INC.
Dated as of August 25th, 2006
THIS AGREEMENT, dated as of August 25, 2006, is between Rocketinfo,
Inc., a Delaware corporation, having a principal place of business
located at 0 Xxxxxx Xxxxxx Xxxxx, Xxxxx 0000, Xxxxx Xxx, Xxxxxxxxxx
00000 ?Rocketinfo? or the ?Company?, and Computershare Trust Company,
Inc., a transfer company registered by the Securities and Exchange
Commission having a principal place of business located at
Computershare Trust Company, Inc., 000 Xxxxxxx Xxxxxx, Xxxxx 000,
Xxxxxx, Xxxxxxxx 00000 (the ?Warrant Agent?, and collectively with
Rocketinfo referred to as the "Parties").
The Company, has or will enter into two individual consulting
agreements which together require the Company to issue up to 3,200,000
share purchase warrants which will be subject to this Agreement
(?Warrants?). Each Warrant is exercisable to purchase one share of
Common Stock for US$ 0.10 per share from the date of issuance of the
warrant certificate to the second year anniversary date of the
individual warrant certificate, on the terms and conditions and subject
to adjustment in certain circumstances, all as set forth in this
Agreement. All sums are in US currency.
The Company wishes to hire the Warrant Agent to act on behalf of the
Company, and the Warrant Agent is willing to act, in connection with
the issuance, transfer, exchange and replacement of the certificates
evidencing the Warrants to be issued under this Agreement (the "Warrant
Certificates") and the exercise of the Warrants;
The Company and the Warrant Agent wish to enter into this Agreement to
establish the terms and conditions of the Warrants and the rights of
the holders ("Warrant Holders") and to establish the respective rights
and obligations of the Company and the Warrant Agent. Each Warrant
Holder is an intended beneficiary of this Agreement.
NOW, in consideration of the premises and the mutual agreements set
forth, the parties agree as follows:
SECTION 1. APPOINTMENT OF WARRANT AGENT
The Company appoints the Warrant Agent to act as agent for the Company
under the instructions contained in this Agreement and the Warrant
Agent accepts this appointment.
SECTION 2. DATE, DENOMINATION AND EXECUTION OF WARRANT CERTIFICATES
The Warrant Certificates (and the Form of Election to Purchase and the
Form of Assignment) will be in registered form only and be similar to
Exhibit A, and may have letters, numbers or other marks of
identification or designation and legends, summaries or endorsements
printed, lithographed or engraved as the Company may consider
appropriate and as are not inconsistent with the provisions of this
Agreement, or as may be required to comply with any law, or with any
rule or regulation, or with any rule or regulation of any stock
exchange on which the Common Stock or the Warrants may be listed or any
automated quotation system, or to conform to usage. Each Warrant
Certificate will entitle the registered holder, subject to the
provisions of this Agreement and of the Warrant Certificate, to
purchase, on or before the close of business on August 26, 2009 (the
"Expiration Date"), one fully paid and non-assessable share of Common
Stock for each Warrant evidenced by the Warrant Certificate, subject to
adjustments as provided in Sections 6, for US$ 0.10 per share anytime
on or before the closing to the third year anniversary date of issuance
of the applicable Warrant Certificate. Each Warrant Certificate issued
as a part of the incentive for two individuals to enter into consulting
agreements with the Company as described in the recitals, above, will
be dated August 25, 2006; each other Warrant Certificate will be dated
the date on which the Warrant Agent receives valid issuance
instructions from the Company or a transferring holder of a Warrant
Certificate or, if the instructions specify another date.
For purposes of this Agreement, the term "close of business" on any
given date will mean 5:00 p.m., Pacific Standard Time; provided,
however, that if the date is not a business day, it will mean 5:00
p.m., Pacific Standard Time, on the next succeeding business day. For
purposes of this Agreement, the term "business day" will mean any day
other than a Saturday, Sunday, or a day on which banking institutions
in the State of Colorado are authorized or obligated by law to be
closed.
Each Warrant Certificate will be executed on behalf of the Company by
two officers of the Company. Each Warrant Certificate will be manually
countersigned by the Warrant Agent and will not be valid for any
purpose unless it has been countersigned by the Warrant Agent.
SECTION 3. SUBSEQUENT ISSUE OF WARRANT CERTIFICATES
Subsequent to their original issuance, no Warrant Certificates will be
reissued except:
(A) Warrant Certificates issued on transfer thereof under Section 4,
(B) Warrant Certificates issued on any combination, split-up or
exchange of Warrant Certificates under Section 4,
(C) Warrant Certificates issued in replacement of mutilated,
destroyed, lost or stolen Warrant Certificates under Section 5,
(D) Warrant Certificates issued on the partial exercise of Warrant
Certificates under Section 7, and
(E) Warrant Certificates issued to reflect any adjustment or change in
the Relevant Exercise Price or the number or kind of shares
purchasable thereunder under Section 22. The Warrant Agent is
irrevocably authorized to countersign and deliver, under the
provisions of Sections 4, 5, 7 and 22, the new Warrant
Certificates required for purposes thereof, and the Company,
whenever required by the Warrant Agent, will supply the Warrant
Agent with Warrant Certificates duly executed on behalf of the
Company for this purpose.
SECTION 4. TRANSFERS AND EXCHANGES OF WARRANT CERTIFICATES
The Warrant Agent will keep or cause to be kept books for registration
of ownership and transfer of the Warrant Certificates issued hereunder.
The registers will show the names and addresses of the respective
holders of the Warrant Certificates and the number of Warrants
evidenced by each Warrant Certificate.
The Warrant Agent will, from time to time, register the transfer of any
outstanding Warrants on the books to be maintained by the Warrant Agent
for that purpose, on surrender of the Warrant Certificate evidencing
the Warrants, with the Form of Assignment duly filled in and executed
with the signature guaranteed by a banking institution or NASD member
and the supporting documentation as the Warrant Agent or the Company
may reasonably require, to the Warrant Agent at its stock transfer
office in Golden, Colorado at any time on or before the Expiration
Date, and on payment to the Warrant Agent for the account of the
Company of an amount equal to any applicable transfer tax. Payment of
the amount of the tax may be made in cash, or by certified or official
bank check, payable in lawful money of the United States of America to
the order of the Company.
On receipt of a Warrant Certificate, with the Form of Assignment duly
filled in and executed, accompanied by payment of an amount equal to
any applicable transfer tax, the Warrant Agent will promptly cancel the
surrendered Warrant Certificate and countersign and deliver to the
transferee a new Warrant Certificate for the number of full Warrants
transferred to the transferee; provided, however, that in case the
registered holder of any Warrant Certificate will elect to transfer
fewer than all of the Warrants evidenced by the Warrant Certificate,
the Warrant Agent in addition will promptly countersign and deliver to
the registered holder a new Warrant Certificate or Certificates for the
number of full Warrants not so transferred.
Any Warrant Certificate or Certificates may be exchanged at the option
of the holder thereof for another Warrant Certificate or Certificates
of different denominations, of like tenor and representing in the
aggregate the number of Warrants, on surrender of the Warrant
Certificate or Certificates, with the Form of Assignment duly filled in
and executed, to the Warrant Agent, at any time or from time to time
after the close of business on the date of the Warrant Certificate and
prior to the close of business on the Expiration Date. The Warrant
Agent will promptly cancel the surrendered Warrant Certificate and
deliver the new Warrant Certificate under this Section.
SECTION 5. MUTILATED, DESTROYED, LOST OR STOLEN WARRANT CERTIFICATES
The Warrant Agent will deliver a new Warrant Certificate for the number
of Warrants to a Warrant Holder who provides the Company and the
Warrant Agent evidence of the loss, theft, destruction or mutilation of
any Warrant Certificate. The Warrant Holder will be required to
provide the Company and Warrant Agent with standard indemnity or
security and reimburse them of all reasonable expenses associated with
the replacement of any Warrant Certificate which has been lost, stolen
or destroyed. The Warrant Holder must surrender and agree to the
cancellation of any Warrant Certificate which is being replaced because
of mutilation.
SECTION 6. ADJUSTMENTS OF NUMBER AND KIND OF SHARES PURCHASABLE AND
EXERCISE PRICE
The number and kind of securities or other property purchasable on
exercise of a Warrant will be subject to adjustment from time to time
on the occurrence, after the date, of any of the following events:
A. In case the Company (1) pays a dividend in, or make a distribution
of, shares of capital stock on its outstanding Common Stock, (2)
subdivides its outstanding shares of Common Stock into a greater number
of the shares or (3) combines its outstanding shares of Common Stock
into a smaller number of the shares, the total number of shares of
Common Stock purchasable on the exercise of each Warrant outstanding
immediately prior will be adjusted so that the holder of any Warrant
Certificate surrendered for exercise will be entitled to receive at the
aggregate Relevant Exercise Price the number of shares of capital stock
(of one or more classes) which the holder would have owned or have been
entitled to receive immediately following the happening of any of the
events described above had the Warrant been exercised in full
immediately prior to the record date of this event. Any adjustment made
under this Subsection will, in the case of a stock dividend or
distribution, become effective as of the record date therefor and, in
the case of a subdivision or combination, be made as of the effective
date thereof. If, as a result of an adjustment made under this
Subsection, the holder of any Warrant Certificate thereafter
surrendered for exercise will become entitled to receive shares of two
or more classes of capital stock of the Company, the Board of Directors
of the Company (whose determination will be conclusive and will be
evidenced by a Board resolution filed with the Warrant Agent) will
determine the allocation of the adjusted Relevant Exercise Price
between or among shares of the classes of capital stock.
B. On a capital reorganization or a reclassification of the Common
Stock (except as provided in Subsection A. above or Subsection E.
below), any Warrant Holder, on exercise of Warrants, will be entitled
to receive, in substitution for the Common Stock to which he would have
become entitled on exercise immediately prior to the reorganization or
reclassification, the shares (of any class or classes) or other
securities or property of the Company (or cash) that he would have been
entitled to receive at the aggregate Relevant Exercise Price on the
reorganization or reclassification if the Warrants had been exercised
immediately prior to the record date of this event; and in any case,
appropriate provision (as determined by the Board of Directors of the
Company, whose determination will be conclusive and will be evidenced
by a certified Board resolution filed with the Warrant Agent) will be
made for the application of this Section 6 and the interests of the
Warrant Holders (including but not limited to the allocation of the
Relevant Exercise Price between or among shares of classes of capital
stock), to the end that this Section 6 (including the adjustments of
the number of shares of Common Stock or other securities purchasable
and the Relevant Exercise Price thereof) will thereafter be reflected,
as nearly as reasonably practicable, in all subsequent exercises of the
Warrants for any shares or securities or other property (or cash)
thereafter deliverable on the exercise of the Warrants.
C. Whenever the number of shares of Common Stock or other securities
purchasable on exercise of a Warrant is adjusted as provided in this
Section 6, the Company will promptly file with the Warrant Agent a
certificate signed by a Chairman or co-Chairman of the Board or the
President or a Vice President of the Company and by the Treasurer or an
Assistant Treasurer or the Secretary or an Assistant Secretary of the
Company setting forth the number and kind of securities or other
property purchasable on exercise of a Warrant, as so adjusted, stating
that the adjustments in the number or kind of shares or other
securities or property conform to the requirements of this Section 6,
and setting forth a brief statement of the facts accounting for the
adjustments. Promptly after receipt of the certificate, the Company, or
the Warrant Agent at the Company's request, will deliver, by first-
class, postage prepaid mail, a brief summary thereof (to be supplied by
the Company) to the registered holders of the outstanding Warrant
Certificates; provided, however, that failure to file or to give any
notice required under this Subsection, or any defect therein, will not
affect the legality or validity of any the adjustments under this
Section 6; and provided, further, that, if appropriate, the notice may
be given in advance and included as part of the notice required to be
given under Section 12.
D. In case of any consolidation of the Company with, or merger of the
Company into, another corporation (other than a consolidation or merger
which does not result in any reclassification or change of the
outstanding Common Stock), or in case of any sale or conveyance to
another corporation of the property of the Company as an entirety or
substantially as an entirety, the corporation formed by the
consolidation or merger or the corporation which will have acquired the
assets, as the case may be, will execute and deliver to the Warrant
Agent a supplemental warrant agreement providing that the holder of
each Warrant then outstanding will have the right thereafter (until the
expiration of the Warrant) to receive, on exercise of the Warrant,
solely the kind and amount of shares of stock and other securities and
property (or cash) receivable on the consolidation, merger, sale or
transfer by a holder of the number of shares of Common Stock of the
Company for which the Warrant might have been exercised immediately
prior to the consolidation, merger, sale or transfer. The supplemental
warrant agreement will provide for adjustments which will be as nearly
equivalent as may be practicable to the adjustments provided in this
Section. The above provision of this Subsection will similarly apply to
successive consolidations, mergers, sales or transfers.
The Warrant Agent will not be under any responsibility to determine the
correctness of any provision contained in any supplemental warrant
agreement relating to either the kind or amount of shares of stock or
securities or property (or cash) purchasable by holders of Warrant
Certificates on the exercise of their Warrants after any consolidation,
merger, sale or transfer or of any adjustment to be made, but subject
to the provisions of Section 20, may accept as conclusive evidence of
the correctness of any the provisions, and will be protected in relying
on, a certificate of a firm of independent certified public accountants
(who may be the accountants regularly employed by the Company).
E. Irrespective of any adjustments in the number or kind of shares
issuable on exercise of Warrants, Warrant Certificates issued may
continue to express the price and number and kind of shares as are
stated in the similar Warrant Certificates initially issuable under
this Warrant Agreement.
F. The Company may hire a firm of independent public accountants of
recognized standing, which may be the firm regularly hired by the
Company, selected by the Board of Directors of the Company or the
Executive Committee of the Board, and not disapproved by the Warrant
Agent, to make any computation required under this Section, and a
certificate signed by the firm will, in the absence of fraud or gross
negligence, be conclusive evidence of the correctness of any
computation made under this Section.
G. For the purpose of this Section, the term "Common Stock" will
mean (i) the Common Stock or (ii) any other class of stock resulting
from successive changes or reclassifications of the Common Stock
consisting solely of changes in par value, or from par value to no par
value, or from no par value to par value. In the event that at any time
as a result of an adjustment made under this Section, the holder of any
Warrant thereafter surrendered for exercise will become entitled to
receive any shares of capital stock of the Company other than shares of
Common Stock, thereafter the number of the other shares so receivable
on exercise of any Warrant will be subject to adjustment from time to
time in a manner and on terms as nearly equivalent as practicable to
the provisions concerning to the Common Stock contained in this
Section, and all other provisions of this Agreement, about the Common
Stock, will apply on like terms to any other shares.
H. The Company may, from time to time and to the extent permitted by
law, reduce the relevant Exercise Price of the Warrants by any amount
for a period of not less than 20 days. If the Company so reduces the
relevant Exercise Price of the Warrants, it will give not less than 15
days' notice of the decrease, which notice may be in the form of a
press release, and will take all other steps as may be required under
applicable law in connection with any offers or sales of securities at
the reduced price.
SECTION 7. EXERCISE OF WARRANTS
Unless the Warrants have been redeemed as provided in this Section 7,
the registered holder of any Warrant Certificate may exercise the
Warrants evidenced thereby, in whole at any time or in part from time
to time at or prior to the close of business, on the Expiration Date,
subject to the provisions of Section 9, at which time the Warrant
Certificates will be and become wholly void and of no value. Warrants
may be exercised by their holders or redeemed by the Company as
follows:
A. Exercise of Warrants will be accomplished on surrender of the
Warrant Certificate evidencing the Warrants, with the Form of Election
to Purchase on the reverse side thereof duly filled in and executed, to
the Warrant Agent at its stock transfer office in Golden, Colorado,
together with payment to the Company of the Relevant Exercise Price (as
of the date of the surrender) of the Warrants then being exercised and
an amount equal to any applicable transfer tax and, if requested by the
Company, any other taxes or governmental charges which the Company may
be required by law to collect in respect of the exercise. Payment of
the Relevant Exercise Price and other amounts may be made by wire
transfer of good funds, or by certified or bank cashier's check,
payable in lawful money of the United States of America to the order of
the Company. No adjustment will be made for any cash dividends, whether
paid or declared, on any securities issuable on exercise of a Warrant.
B. On receipt of a Warrant Certificate, with the Form of Election to
Purchase duly filled in and executed, accompanied by payment of the
Relevant Exercise Price of the Warrants being exercised (and of an
amount equal to any applicable taxes or government charges), the
Warrant Agent will promptly request from the Transfer Agent the
securities to be issued and deliver to or on the order of the
registered holder of the Warrant Certificate, in the name or names as
the registered holder may designate, a certificate or certificates for
the number of full shares of the securities to be purchased, together
with cash made available by the Company under Section 8 in respect of
any fraction of a share of the securities otherwise issuable on the
exercise. If the Warrant is then exercisable to purchase property other
than securities, the Warrant Agent will take appropriate steps to cause
the property to be delivered to or on the order of the registered
holder of the Warrant Certificate. In addition, if it is required by
law and on instruction by the Company, the Warrant Agent will deliver
to each Warrant Holder a prospectus which complies with the provisions
of Section 9 of the Securities Act of 1933 and the Company agrees to
supply Warrant Agent with enough prospectuses to carry out that
purpose.
C. In case the registered holder of any Warrant Certificate will
exercise fewer than all of the Warrants evidenced by the Warrant
Certificate, the Warrant Agent will promptly countersign and deliver to
the registered holder of the Warrant Certificate, or to registered
holder=s duly authorized assigns, a new Warrant Certificate or
Certificates evidencing the number of Warrants that were not so
exercised.
D. Each person in whose name any certificate for securities is issued
on the exercise of Warrants will for all purposes be considered to have
become the holder of record of the securities represented thereby as
of, and the certificate will be dated, the date on which the Warrant
Certificate was duly surrendered in proper form and payment of the
Relevant Exercise Price (and of any applicable taxes or other
governmental charges) was made; provided, however, that if the date of
the surrender and payment is a date on which the stock transfer books
of the Company are closed, the person will be considered to have become
the record holder of the shares as of, and the certificate for the
shares will be dated, the next succeeding business day on which the
stock transfer books of the Company are open (whether before, on or
after the Expiration Date) and the Warrant Agent will be under no duty
to deliver the certificate for the shares until the date. The Company
covenants and agrees that it will not cause its stock transfer books to
be closed for a period of more than 20 consecutive business days except
on consolidation, merger, sale of all or substantially all of its
assets, dissolution or liquidation or as otherwise provided by law.
SECTION 8. FRACTIONAL INTERESTS
The Company will not be required to issue any Warrant Certificate
evidencing a fraction of a Warrant or to issue fractions of shares of
securities on the exercise of the Warrants. If any fraction (calculated
to the nearest one-hundredth) of a Warrant or a share of securities
would, except for the provisions of this Section, be issuable on the
exercise of any Warrant, the Company will, at its option, either
purchase the fraction for an amount in cash equal to the current value
of the fraction computed on the basis of the closing market price (as
quoted on NASDAQ) on the trading day immediately preceding the day on
which the Warrant Certificate was surrendered for exercise under
Section 7 or issue the required fractional Warrant or share. By
accepting a Warrant Certificate, the holder thereof expressly waives
any right to receive a Warrant Certificate evidencing any fraction of a
Warrant or to receive any fractional share of securities on exercise of
a Warrant, except as expressly provided in this Section 8.
SECTION 9. RESERVATION OF EQUITY SECURITIES
The Company covenants that it will at all times reserve and keep
available, free from any pre-emptive rights, out of its authorized and
unissued equity securities, solely for the purpose of issue on exercise
of the Warrants, the number of shares of equity securities of the
Company as will then be issuable on the exercise of all outstanding
Warrants ("Equity Securities"). The Company covenants that all Equity
Securities which will be so issuable will, on the issue, be duly
authorized, validly issued, fully paid and non-assessable.
SECTION 10. REDUCTION OF CONVERSION PRICE BELOW PAR VALUE
Before taking any action that would cause an adjustment under Section 6
reducing the portion of the Relevant Exercise Price required to
purchase one share of capital stock below the then par value (if any)
of a share of the capital stock, the Company will use its best efforts
to take any corporate action which, in the opinion of its counsel, may
be necessary in order that the Company may validly and legally issue
fully paid and non-assessable shares of the capital stock.
SECTION 11. PAYMENT OF TAXES
The Company covenants and agrees that it will pay when due and payable
all federal and state documentary stamp and other original issue taxes
which may be payable in respect of the original issuance of the Warrant
Certificates, or any shares of Common Stock or other securities on the
exercise of Warrants. The Company will not, however, be required (i) to
pay any tax which may be payable in respect of any transfer involved in
the transfer and delivery of Warrant Certificates or the issuance or
delivery of certificates for Common Stock or other securities in a name
other than that of the registered holder of the Warrant Certificate
surrendered for purchase or (ii) to issue or deliver any certificate
for shares of Common Stock or other securities on the exercise of any
Warrant Certificate until any tax will have been paid, all tax being
payable by the holder of the Warrant Certificate at the time of
surrender.
SECTION 12. NOTICE OF CERTAIN CORPORATE ACTION
In case the Company after the date will propose (i) to offer to the
holders of Common Stock, generally, rights to subscribe to or purchase
any additional shares of any class of its capital stock, any evidences
of its indebtedness or assets, or any other rights or options or (ii)
to effect any reclassification of Common Stock (other than a
reclassification involving merely the subdivision or combination of
outstanding shares of Common Stock) or any capital reorganization, or
any consolidation or merger to which the Company is a party and for
which approval of any stockholders of the Company is required, or any
sale, transfer or other disposition of its property and assets taken
for the offer of rights or options, or the date on which the
reclassification, reorganization, consolidation, merger, sale,
transfer, other disposition, liquidation, voluntary or involuntary
dissolution or winding-up will take place or begin, as the case may be,
and which will also specify any record date for determination of
holders of Common Stock entitled to vote thereon or participate therein
and will set forth as may be reasonably necessary to indicate any
adjustments in the Relevant Exercise Price and the number or kind of
shares or other securities purchasable on exercise of Warrants which
will be required as a result of the action. The notice will be filed
and mailed in the case of any action covered by clause (i) above, not
less than ten days prior to the record date for determining holders of
the Common Stock for purposes of the action or, if a record is not to
be taken, the date as of which the holders of shares of Common Stock of
record are to be entitled to the offering; and, in the case of any
action covered by clause (ii) above, not less than 20 days prior to the
earlier of the date on which the reclassification, reorganization,
consolidation, merger, sale, transfer, other disposition, liquidation,
voluntary or involuntary dissolution or winding-up is expected to
become effective and the date on which it is expected that holders of
shares of Common Stock of record on the date will be entitled to
exchange their shares for securities or other property deliverable on
the reclassification, reorganization, consolidation, merger, sale,
transfer, other disposition, liquidation, voluntary or involuntary
dissolution or winding-up.
Failure to give any notice or any defect therein will not affect the
legality or validity of any transaction listed in this Section 12.
SECTION 13. DISPOSITION OF PROCEEDS ON EXERCISE OF WARRANT
CERTIFICATES, ETC.
The Warrant Agent will account promptly to the Company all Warrants
exercised and concurrently pay to the Company all moneys received by
the Warrant Agent for the purchase of securities or other property
through the exercise of the Warrants.
The Warrant Agent will keep a copy of this Agreement available for
inspection by Warrant Holders during normal business hours at its
office. Copies of this Agreement may also be obtained on written
request addressed to the Warrant Agent.
SECTION 14. WARRANT HOLDER NOT CONSIDERED A STOCKHOLDER
No Warrant Holder, will be entitled to vote, receive dividends or be
considered the holder of Common Stock or any other securities of the
Company which may at any time be issuable on the exercise of the
Warrants represented thereby for any purpose whatever, nor will
anything contained or in any Warrant Certificate be construed to confer
on any Warrant Holder, any of the rights of a stockholder of the
Company or any right to vote for the election of directors or on any
matter submitted to stockholders at any meeting thereof, or to give or
withhold consent to any corporate action (whether on any
recapitalization, issuance of stock, reclassification of stock, change
of par value or change of stock to no par value, consolidation, merger,
conveyance or otherwise), or to receive notice of meetings or other
actions affecting stockholders (except as provided in Section 12), or
to receive dividend or subscription rights, or otherwise, until the
Warrant Certificate will have been exercised under the provisions and
the receipt of the Relevant Exercise Price and any other amounts
payable on the exercise by the Warrant Agent.
SECTION 15. RIGHT OF ACTION
All rights of action in respect to this Agreement are vested in the
respective registered holders of the Warrant Certificates; and any
registered holder of any Warrant Certificate, without the consent of
the Warrant Agent or of any other holder of a Warrant Certificate, may,
in his own behalf for his own benefit, enforce, and may institute and
maintain any suit, action or proceeding against the Company suitable to
enforce, or otherwise in respect of, his right to exercise the Warrants
evidenced by the Warrant Certificate, for the purchase of shares of the
Common Stock in the manner provided in the Warrant Certificate and in
this Agreement.
SECTION 16. AGREEMENT OF HOLDERS OF WARRANT CERTIFICATES
Every holder of a Warrant Certificate by accepting the consents and
agrees with the Company, the Warrant Agent and with every other holder
of a Warrant Certificate that:
A. the Warrant Certificates are transferable on the registry books
of the Warrant Agent only on the terms and conditions set forth
in this Agreement; and
B. the Company and the Warrant Agent may consider and treat the
person in whose name the Warrant Certificate is registered as the
absolute owner of the Warrant (notwithstanding any notation of
ownership or other writing thereon made by anyone other than the
Company or the Warrant Agent) for all purposes whatever and
neither the Company nor the Warrant Agent will be affected by any
notice to the contrary.
SECTION 17. CANCELLATION OF WARRANT CERTIFICATES
In the event that the Company will purchase or otherwise acquire any
Warrant Certificate or Certificates after the issuance thereof, the
Warrant Certificate or Certificates will thereon be delivered to the
Warrant Agent and be canceled by it and retired. The Warrant Agent will
also cancel any Warrant Certificate delivered to it for exercise, in
whole or in part, or delivered to it for transfer, split-up,
combination or exchange. Warrant Certificates so canceled will be
delivered by the Warrant Agent to the Company from time to time, or
disposed of under the instructions of the Company.
SECTION 18. ABOUT THE WARRANT AGENT
The Company agrees to pay to the Warrant Agent from time to time, on
demand of the Warrant Agent, reasonable compensation for all services
rendered by it hereunder and also its reasonable expenses, including
counsel fees, and other disbursements incurred in the administration
and execution of this Agreement and the exercise and performance of its
duties hereunder. The Company also agrees to indemnify the Warrant
Agent for, and to hold it harmless against, any loss, liability or
expense, incurred without gross negligence, bad faith or willful
misconduct on the part of the Warrant Agent, arising out of or in
connection with the acceptance and administration of this Agreement.
SECTION 19. MERGER OR CONSOLIDATION OR CHANGE OF NAME OF WARRANT AGENT
Any corporation into which the Warrant Agent may be merged or with
which it may be consolidated, or any corporation resulting from any
merger or consolidation to which the Warrant Agent will be a party, or
any corporation succeeding to the corporate trust business of the
Warrant Agent, will be the successor to the Warrant Agent without the
execution or filing of any paper or any further act on the part of any
of the parties , if the corporation would be eligible for appointment
as a successor warrant agent under Section 21 of this Agreement. In
case at the time the successor to the Warrant Agent will succeed to the
agency created by this Agreement, any of the Warrant Certificates will
have been countersigned but not delivered, any successor to the Warrant
Agent may adopt the countersignature of the original Warrant Agent and
deliver the Warrant Certificates so countersigned; and in case at that
time any of the Warrant Certificates will not have been countersigned,
any successor to the Warrant Agent may countersign the Warrant
Certificates either in the name of the predecessor Warrant Agent or in
the name of the successor Warrant Agent; and in all the cases the
Warrant Certificates will have the full force provided in the Warrant
Certificates and in this Agreement.
In case at any time the name of the Warrant Agent will be changed and
when any of the Warrant Certificates will have been countersigned but
not delivered, the Warrant Agent may adopt the countersignature under
its prior name and deliver Warrant Certificates so countersigned; and
in case at that time any of the Warrant Certificates will not have been
countersigned, the Warrant Agent may countersign the Warrant
Certificates either in its prior name or in its changed name; and in
all cases the Warrant Certificates will have the full force provided in
the Warrant Certificates and in this Agreement.
SECTION 20. DUTIES OF WARRANT AGENT
The Warrant Agent undertakes the duties and obligations imposed by this
Agreement on the following terms and conditions, by all of which the
Company and the holders of Warrant Certificates, by their acceptance
thereof, will be bound:
A. The Warrant Agent may consult with counsel satisfactory to it (who
may be counsel for the Company or the Warrant Agent's in-house
counsel), and the opinion of counsel will be complete authorization and
protection to the Warrant Agent as to any action taken, suffered or
omitted by it in good faith and under the opinion; provided, however,
that the Warrant Agent will have exercised reasonable care in the
selection of counsel. Fees and expenses of counsel, to the extent
reasonable, will be paid by the Company.
B. Whenever in the performance of its duties under this Agreement,
the Warrant Agent will consider it necessary or desirable that any fact
or matter be proved or established by the Company prior to taking or
suffering any action hereunder, the fact or matter (unless other
evidence in respect thereof be specifically prescribed) may be
considered to be conclusively proved and established by a certificate
signed by a Chairman or co-Chairman of the Board or the President or a
Vice President or the Secretary of the Company and delivered to the
Warrant Agent; and the certificate will be full authorization to the
Warrant Agent for any action taken or suffered in good faith by it
under this Agreement in reliance on the certificate.
C. The Warrant Agent will be liable hereunder only for its own gross
negligence, bad faith or willful misconduct.
D. The Warrant Agent will not be liable for or by reason of any of
the statements of fact or recitals contained in this Agreement or in
the Warrant Certificates (except its countersignature on the Warrant
Certificates and the statements or recitals as describe the Warrant
Agent or action taken or to be taken by it) or be required to verify,
but all statements and recitals are and will be considered to have been
made by the Company only.
E. The Warrant Agent will not be under any responsibility in respect
of the validity of this Agreement or the execution and delivery (except
the due execution by the Warrant Agent) or in respect of the validity
or execution of any Warrant Certificate (except its countersignature
thereof); nor will it be responsible for any breach by the Company of
any covenant or condition contained in this Agreement or in any Warrant
Certificate; nor will it be responsible for the making of any change in
the number of shares of Common Stock for which a Warrant is exercisable
required under Section 6 or responsible for the manner, method or
amount of any change or the determining of the existence of facts that
would require any adjustment or change (except for the exercise of
Warrant Certificates after actual notice of any adjustment of the
Relevant Exercise Price); nor will it by any act hereunder be
considered to make any representation or warranty as to the
authorization or reservation of any shares of Common Stock to be issued
under this Agreement or any Warrant Certificate or as to whether any
shares of Common Stock will, when issued, be validly issued, fully paid
and non-assessable.
F. The Warrant Agent will be under no obligation to institute any
action, suit or legal proceeding or take any other action likely to
involve expense unless the Company or one or more registered holders of
Warrant Certificates will give the Warrant Agent with reasonable
security and indemnity for any costs and expenses which may be
incurred. All rights of action under this Agreement or under any of the
Warrants may be enforced by the Warrant Agent without the possession of
any of the Warrants or the production thereof at any trial or other
proceeding relative, and any action, suit or proceeding instituted by
the Warrant Agent will be brought in its name as Warrant Agent, and any
recovery of judgment will be for the ratable benefit of the registered
holders of the Warrant Certificates, as their respective rights or
interests may appear.
G. The Warrant Agent and any stockholder, director, officer or
employee of the Warrant Agent may buy, sell or deal in any of the
Warrants or other securities of the Company or become pecuniarily
interested in any transaction in which the Company may be interested,
or contract with or lend money to or otherwise act as fully and freely
as though it were not Warrant Agent under this Agreement. Nothing will
preclude the Warrant Agent from acting in any other capacity for the
Company or for any other legal entity.
H. The Warrant Agent is authorized and directed to accept
instructions regarding the performance of its duties from a Chairman or
co-Chairman of the Board or President or a Vice President or the
Secretary or the Controller of the Company, and to apply to the
officers for advice or instructions in connection with the Warrant
Agent's duties, and it will not be liable for any action taken or
suffered or omitted by it in good faith under instructions of any
officer.
I. The Warrant Agent will not be responsible for any failure of the
Company to comply with any of the covenants contained in this Agreement
or in the Warrant Certificates to be complied with by the Company.
J. The Warrant Agent may execute and exercise any of the rights or
powers vested in it or perform any duty hereunder either itself or by
or through its attorneys, agents or employees and the Warrant Agent
will not be answerable or accountable for any act, default, neglect or
misconduct of any attorneys, agents or employees or for any loss to the
Company resulting from neglect or misconduct; provided, however, that
reasonable care will have been exercised in the selection and continued
employment of the attorneys, agents and employees.
K. The Warrant Agent will not incur any liability or responsibility
to the Company or to any holder of any Warrant Certificate for any
action taken, or any failure to take action, in reliance on any notice,
resolution, waiver, consent, order, certificate, or other paper,
document or instrument reasonably believed by the Warrant Agent to be
genuine and to have been signed, sent or presented by the proper party
or parties.
L. The Warrant Agent will act hereunder solely as agent of the
Company in a ministerial capacity, and its duties will be determined
solely by the provisions. The Warrant Agent will not be liable for
anything which it may do or refrain from doing in connection with this
Agreement except for its own negligence, bad faith or willful conduct.
SECTION 21. CHANGE OF WARRANT AGENT
The Warrant Agent may resign and be discharged from its duties under
this Agreement on 30 days' prior notice in writing mailed, by
registered or certified mail, to the Company. The Company may remove
the Warrant Agent or any successor warrant agent on 30 days' prior
notice in writing, mailed to the Warrant Agent or successor warrant
agent, as the case may be, by registered or certified mail. If the
Warrant Agent will resign or be removed or will otherwise become
incapable of acting, the Company will appoint a successor to the
Warrant Agent and will, within 15 days following the appointment, give
notice thereof in writing to each registered holder of the Warrant
Certificates. If the Company will fail to make the appointment within a
period of 15 days after giving notice of the removal or after it has
been notified in writing of the resignation or incapacity by the
resigning or incapacitated Warrant Agent, then the Company agrees to
perform the duties of the Warrant Agent hereunder until a successor
Warrant Agent is appointed. After appointment and execution of a copy
of this Agreement in effect at that time, the successor Warrant Agent
will be vested with the powers, rights, duties and responsibilities as
if it had been originally named as Warrant Agent without further act or
deed; but the former Warrant Agent will deliver and transfer to the
successor Warrant Agent, within a reasonable time, any property at the
time held by it hereunder, and execute and deliver any further
assurance, conveyance, act or deed necessary for the purpose. Failure
to give any notice provided for in this Section, however, or any defect
therein will not affect the legality or validity of the resignation or
removal of the Warrant Agent or the appointment of the successor
warrant agent, as the case may be.
SECTION 22. ISSUANCE OF NEW WARRANT CERTIFICATES
Notwithstanding any of the provisions of this Agreement or the several
Warrant Certificates to the contrary, the Company may, at its option,
issue new Warrant Certificates in the form as may be approved by its
Board of Directors to reflect any adjustment or change in the Relevant
Exercise Price or the number or kind of shares purchasable under the
several Warrant Certificates made under the provisions of this
Agreement.
SECTION 23. NOTICES
Notice or demand under this Agreement to be given or made on the
Company by the Warrant Agent or by the registered holder of any Warrant
Certificate will be sufficiently given or made if sent by first-class
or registered mail, postage prepaid, addressed (until another address
is filed in writing by the Company with the Warrant Agent) as follows:
Rocketinfo, Inc.
0 Xxxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxx Xxx, Xxxxxxxxxx 00000
Subject to the provisions of Section 21, any notice under this
Agreement to be given or made by the Company or by the holder of any
Warrant Certificate to or on the Warrant Agent will be sufficiently
given or made if sent by first-class or registered mail, postage
prepaid, addressed (until another address is filed in writing by the
Warrant Agent with the Company) as follows:
Computershare Trust Company, Inc.
000 Xxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Any notice or demand authorized to be given or made to the registered
holder of any Warrant Certificate under this Agreement will be
sufficiently given or made if sent by first-class or registered mail,
postage prepaid, to the last address of the holder as it will appear on
the registers maintained by the Warrant Agent.
SECTION 24. MODIFICATION OF AGREEMENT
The Warrant Agent may, without the consent or concurrence of the
Warrant Holders, by supplemental agreement or otherwise, concur with
the Company in making any changes or corrections in this Agreement that
the Warrant Agent will have been advised by counsel (who may be counsel
for the Company) are necessary or desirable to cure any ambiguity or to
correct any defective or inconsistent provision or clerical omission or
mistake or manifest error, or to make any other provisions in regard to
matters or questions arising and which will not be inconsistent with
the provisions of the Warrant Certificates and which will not adversely
affect the interests of the Warrant Holders. As of the date, this
Agreement contains the entire and only agreement, understanding,
representation, condition, warranty or covenant between the parties
about this Agreement, supersedes all other agreements between the
parties relating to the matters, and may be modified or amended only by
a written agreement signed by both parties under the authority granted
by the first sentence of this Section.
SECTION 25. SUCCESSORS
All the covenants and provisions of this Agreement by or for the
benefit of the Company or the Warrant Agent will bind and inure to the
benefit of their respective successors and assigns hereunder.
SECTION 26. COLORADO CONTRACT
This Agreement and each Warrant Certificate issued hereunder will be
considered to be a contract made under the laws of the State of
Colorado and for all purposes will be construed under the laws of the
State.
SECTION 27. TERMINATION
This Agreement will end as of the close of business on the Expiration
Date, or the earlier date on which all Warrants will have been
exercised or redeemed, except that the Warrant Agent will account to
the Company as to all Warrants outstanding and all cash held by it as
of the close of business on the Expiration Date.
SECTION 28. BENEFITS OF THIS AGREEMENT
Nothing in this Agreement or in the Warrant Certificates will be
construed to give to any person or corporation other than the Company,
the Warrant Agent, and their respective successors and assigns
hereunder and the registered holders of the Warrant Certificates any
legal or equitable right, remedy or claim under this Agreement; but
this Agreement will be for the sole and exclusive benefit of the
Company, the Warrant Agent, their respective successors and assigns
hereunder and the registered holders of the Warrant Certificates.
SECTION 29. DESCRIPTIVE HEADINGS
The descriptive headings of the several Sections of this Agreement are
inserted for convenience only and will not control or affect the
meaning or construction of any of the provisions.
SECTION 30. COUNTERPARTS
This Agreement may be executed in any number of counterparts, each of
which will be an original, but the counterparts will together
constitute one and the same instrument.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed, all as of the day and year first above written.
ROCKETINFO, INC.
By: _______________________________
Title:
COMPUTERSHARE TRUST COMPANY, INC.
By: _______________________________
Title:
EXHIBIT ?A? TO WARRANT AGREEMENT
THIS WARRANT AND THE SECURITIES ISSUABLE UPON THE EXERCISE HEREOF HAVE
NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"). THIS WARRANT AND UNDERLYING SECURITIES MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) PURSUANT TO
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR (B) PURSUANT TO A
TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS UNDER THE ACT AND
ANY APPLICABLE STATE SECURITIES LAWS. IN CONNECTION WITH ANY TRANSFER
PURSUANT TO THE FOREGOING CLAUSE (B) THERE MUST BE FURNISHED TO THE
COMPANY A WRITTEN OPINION OF COUNSEL REASONABLY ACCEPTABLE TO THE
COMPANY TO THE EFFECT THAT SUCH TRANSFER IS EXEMPT FROM THE REGULATION
REQUIREMENTS OF ALL APPLICABLE UNITED STATES FEDERAL AND STATE
SECURITIES LAWS. DELIVERY OF THIS CERTIFICATE MAY NOT CONSTITUTE "GOOD
DELIVERY" IN SETTLEMENT OF TRANSACTIONS ON STOCK EXCHANGES IN CANADA.
ROCKETINFO, INC.
COMMON STOCK PURCHASE WARRANT
Warrant Certificate No. Series One W 2006-00-SAMPLE
Holder:
Number of Warrants: 1,600,000
Address:
Expiration Date: August ___, 2009
Exercise Price Per Share: US$ 0.10
For identification only. The governing terms of this Warrant are set
forth below.
Rocketinfo, Inc., a Delaware corporation (the ?Company? or
?Rocketinfo?), hereby certifies that, for value received, RBH Family
Trust (the "Holder"), is entitled, subject to the terms set forth
below, to purchase from the Company at any time or from time to time
after the date hereof and prior to August 26th, 2009 (the "Exercise
Period"), at the Purchase Price hereinafter set forth, one million six
hundred thousand (1,600,000) shares. For every full Warrant the Holder
will be entitled to acquire one share of Common Stock of Rocketinfo at
an exercise price of US$ 0.10 per share anytime on or before the expiry
date. The Warrants have an expiry date of August 26th, 2009.
Capitalized terms used herein not otherwise defined shall have
the meanings ascribed thereto in a warrant agreement entered into
between Rocketinfo and the Computershare Transfer Company, Inc. (the
"Warrant Agreement"). By execution of this Warrant, the Holder hereof
agrees to be bound by and to benefit from the provisions of the Warrant
Agreement set forth herein. As used herein the following terms, unless
the context otherwise requires, have the following respective meanings:
(a) The term "Common Stock" includes:
(i) Rocketinfo's common stock, par value $0.01 per share;
(ii) any other capital stock of any class or classes (however
designated) of Rocketinfo, authorized on or after the date
hereof, the Holders of which shall have the right, without
limitation as to amount, either to all or to a share of the
balance of current dividends and liquidating dividends
after the payment of dividends and distributions on any
shares entitled to preference, and the Holders of which
shall ordinarily, in the absence of contingencies, be
entitled to vote for the election of a majority of
directors of Rocketinfo (even though the right so to vote
has been suspended by the happening of such a contingency);
and
(iii) any other securities into which or for which any of the
securities described in (a) or (b) may be converted or
exchanged pursuant to a plan of recapitalization,
reorganization, merger, sale of assets or otherwise.
(b) The term "Other Securities" refers to any stock (other than Common
Stock) and other securities of Rocketinfo or any other person
(corporate or otherwise) that the Holder of this Warrant at any
time shall be entitled to receive, or shall have received, on the
exercise of this Warrant, in lieu of or in addition to Common
Stock, or that at any time shall be issuable or shall have been
issued in exchange for or in replacement of Common Stock or Other
Securities pursuant to Section 4 or otherwise.
(c) The term "Rocketinfo" shall include Rocketinfo, Inc. and any
corporation that shall succeed or assume the obligations of such
corporation hereunder.
1. Exercise of Warrant.
1.1 Method of Exercise.
(a) This Warrant may be exercised in whole or in part (but not as to a
fractional share of Common Stock), at any time and from time to time
during the Exercise Period by the Holder hereof by delivery of a notice
of exercise (a "Notice of Exercise") substantially in the form attached
hereto as Annex ?A? via facsimile to Rocketinfo. Prior to sending the
Notice of Exercise via facsimile, the Holder shall give Computershare
Trust Company, Inc. notice of its intent to submit a Notice of Exercise
by telephone. Promptly thereafter the Holder shall surrender this
Warrant (if the entire amount of the Warrant is subject to the Notice
of Exercise) to Rocketinfo at its principal office via overnight
delivery service, accompanied by payment of the Purchase Price
multiplied by the number of shares of Common Stock for which this
Warrant is being exercised (the "Exercise Price").
(b) Payment may be made either (i) in cash or by certified or official
bank check payable to the order of the Company equal to the applicable
aggregate Exercise Price, (ii) by delivery of this Warrant, or shares
of Common Stock and/or Common Stock receivable upon exercise of this
Warrant in accordance with the formula set forth in subsection (b)
below, or (iii) by a combination of any of the foregoing methods, for
the number of Common Shares specified in such Exercise Notice (as such
exercise number shall be adjusted to reflect any adjustment in the
total number of shares of Common Stock issuable to the Holder per the
terms of this Warrant) and the Holder shall thereupon be entitled to
receive the number of duly authorized, validly issued, fully-paid and
non-assessable shares of Common Stock (or Other securities) determined
as provided herein.
(c) Notwithstanding any provisions herein to the contrary, if the Fair
Market Value of one share of Common Stock is greater than the Exercise
Price (at the date of calculation as set forth below), in lieu of
exercising this Warrant for cash, the Holder may elect to receive
shares equal to the value (as determined below) of this Warrant (or the
portion thereof being exercised) by surrender of this Warrant at the
principal office of the Company together with the properly endorsed
Exercise Notice in which event the Company shall issue to the Holder a
number of shares of Common Stock computed using the following formula:
X = Y(A-B)
------
A
Where X = the number of shares of Common Stock to be issued to the
Holder
Y = the number of shares of Common Stock purchasable under this
Warrant or, if only a portion of this Warrant is being exercised, the
portion of this Warrant being exercised (at the date of such
calculation)
A = the Fair Market Value of one share of the Company?s Common Stock
(at the date of such calculation)
B = the Exercise Price per share (as adjusted to the date of such
calculation)
(d) The Holder will, to the extent this Warrant is not previously
exercised, and if the last trade price of the shares of the Company's
Common Stock reaches US$ 2.00 per share, this Warrant shall be deemed
automatically exercised (even if not surrendered) immediately before
its expiration. To the extent this Warrant or any portion thereof is
deemed automatically exercised pursuant to this Section 1(d), the
Company agrees to promptly notify the holder hereof of the number of
shares of Common Stock of the Company, if any, the holder hereof is to
receive by reason of such automatic exercise.
(e) On exercise of a portion of this Warrant in accordance with the
terms hereof, records showing the amount so exercised and the date of
exercise shall be maintained on a ledger substantially in the form of
Annex B attached hereto (an originally signed and executed copy of
which shall be delivered to Rocketinfo with each Notice of Exercise).
Rocketinfo shall maintain the originally signed and executed ledger and
the Holder shall maintain a copy thereof. On execution of the exercise
of the Warrants contemplated by the Notice of Exercise, Rocketinfo
shall deliver to the Holder a copy of Annex B signed and executed by
Rocketinfo, and the Holder shall deliver to Rocketinfo a copy of Annex
B signed by the Holder. It is specifically contemplated that Rocketinfo
shall act as the calculation agent for all exercises of this Warrant.
The Holder and any assignee, by acceptance of this Warrant,
acknowledges and agrees that, by reason of the provisions of this
paragraph, following an exercise of a portion of this Warrant, the
number of shares of Common Stock represented by this Warrant will be
the amount indicated on Annex B attached hereto (which may be less than
the amount stated on the face hereof).
(f) In the event there is a dispute as to the number of shares of
Common Stock the Holder is entitled to receive on exercise of this
Warrant, Rocketinfo shall issue to the Holder the number of shares not
in dispute and Rocketinfo and the Holder will use their best efforts to
resolve such dispute within one Business Day following the receipt of a
Notice of Exercise. If such dispute cannot be resolved within such one-
day period, Rocketinfo and the Holder shall submit the dispute to an
independent accountant mutually agreed on by Rocketinfo and the Holder
to make a final and binding determination of the number of shares owed
to the Holder. Rocketinfo shall issue shares of Common Stock owed to
Holder as a result of the resolution of the dispute within two Business
Days following the receipt of the accountant's independent
determination.
1.3 Company Acknowledgment. Rocketinfo will, at the time of the
exercise of this Warrant, on request of the Holder hereof, acknowledge
in writing its continuing obligation to afford to such Holder the
piggyback registration rights to which such Holder shall continue to be
entitled after such exercise in accordance with the provisions of
Section 12(a) of this Warrant Certificate.
1.4 Limitation on Exercise. Notwithstanding the rights of the
Holder to exercise all or a portion of this Warrant as described
herein, such exercise rights shall be limited, solely to the extent set
forth in the Warrant Agreement as if such provisions were specifically
set forth herein. In addition, the number of shares of Common Stock
issuable on exercise of this Warrant is subject to reduction as
specified in Section 6 of the Warrant Agreement.
2. Delivery of Stock Certificates, Etc., on Exercise. As soon as
practicable after the exercise of this Warrant, and in any event within
five (5) Business Days thereafter, Rocketinfo at its expense (including
the payment by it of any applicable issue, stamp or transfer taxes)
will cause to be issued in the name of and delivered to the Holder
thereof, or, to the extent permissible hereunder, to such other person
as such Holder may direct, a certificate or certificates for the number
of fully paid and non-assessable shares of Common Stock (or Other
Securities) to which such Holder shall be entitled on such exercise,
plus, in lieu of any fractional share to which such Holder would
otherwise be entitled, cash equal to such fraction multiplied by the
then applicable Purchase Price, together with any other stock or other
securities and property (including cash, where applicable) to which
such Holder is entitled on such exercise pursuant to Section 1 or
otherwise.
3. Adjustment for Extraordinary Events. The Purchase Price to be
paid by the Holder on exercise of this Warrant, and the consideration
to be received on exercise of this Warrant, shall be adjusted in case
at any time or from time to time pursuant to Section 6 of the Warrant
Agreement as if such provisions were specifically set forth herein.
4. No Impairment. Rocketinfo will not, by amendment of its
Certificate of Incorporation or through any reorganization, transfer of
assets, consolidation, merger, dissolution, issue or sale of securities
or any other voluntary action, avoid or seek to avoid the observance or
performance of any of the terms of this Warrant, but will at all times
in good faith assist in the carrying out of all such terms and in the
taking of all such action as may be necessary or appropriate in order
to protect the rights of the Holder of this Warrant against impairment.
Without limiting the generality of the foregoing, Rocketinfo:
(a) will not increase the par value of any shares of Common
Stock receivable on the exercise of this Warrant above the
amount payable therefor on such exercise;
(b) will take all such action as may be necessary or
appropriate in order that Rocketinfo may validly and
legally issue fully paid and unassessable shares of Common
Stock on the exercise of this Warrant; and
(c) will not transfer all or substantially all of its
properties and assets to any other person (corporate or
otherwise), or consolidate with or merge into any other
person or permit any such person to consolidate with or
merge into Rocketinfo (if Rocketinfo is not the surviving
person), unless such other person shall expressly assume in
writing and will be bound by all the terms of this Warrant.
5. Certificate as to Adjustments. In each case of any adjustment
or readjustment in the shares of Common Stock (or Other Securities)
issuable on the exercise of this Warrant, Rocketinfo will promptly
cause its principal financial officer to compute such adjustment or
readjustment in accordance with the terms of this Warrant and prepare a
certificate setting forth such adjustment or readjustment and showing
in detail the facts on which such adjustment or readjustment is based,
including a statement of:
(a) the consideration received or receivable by Rocketinfo for
any additional shares of Common Stock (or Other Securities)
issued or sold or deemed to have been issued or sold;
(b) the number of shares of Common Stock (or Other Securities)
outstanding or deemed to be outstanding; and
(c) the Purchase Price and the number of shares of Common Stock
to be received on exercise of this Warrant, in effect
immediately prior to such issue or sale and as adjusted and
readjusted as provided in this Warrant.
Rocketinfo will forthwith mail a copy of each such certificate to the
Holder of this Warrant, and will, on the written request at any time of
the Holder of this Warrant, furnish to such Holder a like certificate
setting forth the Purchase Price at the time in effect and showing how
it was calculated.
6. Notices of Record Date, Etc. In the event of:
(a) any taking by Rocketinfo of a record of the Holders of any
class of securities for the purpose of determining the
Holders thereof who are entitled to receive any dividend or
other distribution, or any right to subscribe for, purchase
or otherwise acquire any shares of stock of any class or
any other securities or property, or to receive any other
right; or
(b) any capital reorganization of Rocketinfo, any
reclassification or recapitalization of the capital stock
of Rocketinfo or any transfer of all or substantially all
the assets of Rocketinfo to or consolidation or merger of
Rocketinfo with or into any other Person; or
(c) any voluntary or involuntary dissolution, liquidation or
winding-up of Rocketinfo,
then and in each such event Rocketinfo will mail or cause to be mailed
to the Holder of this Warrant a notice specifying (i) the date on which
any such record is to be taken for the purpose of such dividend,
distribution or right, and stating the amount and character of such
dividend, distribution or right, and (ii) the date on which any such
reorganization, reclassification, recapitalization, transfer,
consolidation, merger, dissolution, liquidation or winding-up is to
take place, and the time, if any, as of which the Holders of record of
Common Stock (or Other Securities) shall be entitled to exchange their
shares of Common Stock (or Other Securities) for securities or other
property deliverable on such reorganization, reclassification,
recapitalization, transfer, consolidation, merger, dissolution,
liquidation or winding-up. Such notice shall be mailed at least 20 days
prior to the date specified in such notice on which any action is to be
taken.
7. Reservation of Stock, Etc. Issuable on Exercise of Warrant.
Rocketinfo will at all times reserve and keep available, solely for
issuance and delivery on the exercise of this Warrant, all shares of
Common Stock (or Other Securities) from time to time issuable on the
exercise of this Warrant.
8. Exchange of Warrant. On surrender for exchange of this
Warrant, properly endorsed and in compliance with the restrictions on
transfer set forth in the legend on the face of this Warrant, to
Rocketinfo, Rocketinfo at its expense will issue and deliver to or on
the order of the Holder thereof a new Warrant of like tenor, in the
name of such Holder or as such Holder (on payment by such Holder of any
applicable transfer taxes) may direct, calling in the aggregate on the
face or faces thereof for the number of shares of Common Stock called
for on the face of the Warrant so surrendered or for such lesser number
of shares of Common Stock as may be reflected on the Warrant Exercise
Ledger attached as Annex B.
9. Replacement of Warrant. On receipt of evidence reasonably
satisfactory to Rocketinfo of the loss, theft, destruction or
mutilation of this Warrant and, in the case of any such loss, theft or
destruction of this Warrant, on delivery of an indemnity agreement or
security reasonably satisfactory in form and amount to Rocketinfo or,
in the case of any such mutilation, on surrender and cancellation of
this Warrant, Rocketinfo at its expense will execute and deliver, in
lieu thereof, a new Warrant of like tenor.
10. Remedies. Rocketinfo stipulates that the remedies at law of
the Holder of this Warrant in the event of any default or threatened
default by Rocketinfo in the performance of or compliance with any of
the terms of this Warrant are not and will not be adequate, and that
such terms may be specifically enforced by a decree for the specific
performance of any agreement contained herein or by an injunction
against a violation of any of the terms hereof or otherwise.
11. Negotiability, Etc. This Warrant is issued on the following
terms, to all of which each Holder or owner hereof by the taking hereof
consents and agrees:
(a) until this Warrant is transferred on the books of
Rocketinfo, Rocketinfo may treat the registered Holder
hereof as the absolute owner hereof for all purposes,
notwithstanding any notice to the contrary; and
(b) this Warrant may not be sold, transferred or assigned
except pursuant to an effective registration statement
under the Securities Act or pursuant to an applicable
exemption therefrom.
12. Piggyback Registration Rights. If Rocketinfo proposes to
register any of its Common Stock either for its own account or the
account of a security holder or holders exercising their respective
demand registration rights (other than pursuant to a Form S-8):
(a) Rocketinfo shall use its best efforts to include in such
registration (and any related qualification under blue sky
laws or other compliance) all the underlying shares of
Common Stock to be issued pursuant to this warrant
agreement.
(b) All registration expenses incurred in connection with any
registration, qualification or compliance pursuant to
Sections 12(a) hereof, shall be borne by Rocketinfo.
(c) Notwithstanding the foregoing, if the managing underwriter
of any such offering determines that the number of shares
proposed to be sold by Rocketinfo, by other shareholders
having piggy-back rights, and/or by the Purchaser is
greater than the number of shares which the underwriter
believes feasible to sell at the time, at the price and
upon the terms approved by Rocketinfo, then the number of
shares which the underwriter believes may be sold shall be
allocated for inclusion in the registration statement in
the following order of priority: (i) shares being offered
by Rocketinfo; and (ii) pro rata among the other
shareholders and the Purchaser, based on the number of
shares of Common Stock each shareholder requested to be
registered. Rocketinfo shall have the right to designate
the managing underwriter in respect of a public offering
pursuant to this Section 12.
13. Pooling Agreement. The Holder will enter into a pooling
agreement concerning this Warrant, and the shares of Common Stock to be
issued upon exercise this Warrant, substantially in the form of Annex
?D? (the "Pooling Agreement"). The term of the applicable pooling
period shall three years subject to the Pooling Agreement. Rocketinfo
may impose stop-transfer instructions with respect to the Common Stock
(or securities) subject to the foregoing restriction until the end of
said three year period.
14. Compliance with Securities Act; Disposition of Warrant or
Shares of Common Stock.
(a) Compliance with Securities Act. The holder of this
Warrant, by acceptance hereof, agrees that this Warrant,
the shares of Common Stock to be issued upon exercise
hereof are being acquired for investment and that such
holder will not offer, sell or otherwise dispose of this
Warrant or any shares of Common Stock to be issued upon
exercise hereof except under circumstances which will not
result in a violation of the Securities Act. This Warrant
and all Shares issued upon exercise of this Warrant (unless
registered under the Act) shall be stamped or imprinted
with a legend in substantially the following form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED. NO SALE OR DISPOSITION MAY BE
EFFECTED WITHOUT (i) AN EFFECTIVE REGISTRATION STATEMENT
RELATED THERETO, (ii) AN OPINION OF COUNSEL FOR THE HOLDER
THAT SUCH REGISTRATION IS NOT REQUIRED OR (iii) RECEIPT OF
A NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE
COMMISSION TO THE EFFECT THAT REGISTRATION UNDER THE ACT IS
NOT REQUIRED.
(b) Disposition of Warrant and Shares. With respect to any
offer, sale or other disposition of this Warrant or any
shares of Common Stock acquired pursuant to the exercise of
this prior to registration thereof, the holder hereof and
each subsequent holder of this Warrant agrees to give
written notice to the Company prior thereto, describing
briefly the manner thereof, together with a written opinion
of such holder's counsel, if reasonably requested by the
Company, to the effect that such offer, sale or other
disposition may be effected without registration or
qualification (under the Act as then in effect or any
federal or state law then in effect) of this Warrant or
such shares of Common Stock and indicating whether or not
under the Act certificates for this Warrant or such shares
of Common Stock to be sold or otherwise disposed of require
any restrictive legend as to applicable restrictions on
transferability in order to insure compliance with the Act.
Each certificate representing this Warrant or the shares of
Common Stock thus transferred (except a transfer pursuant
to Rule 144) shall bear a legend as to the applicable
restrictions on transferability in order to insure
compliance with the Act unless, in the aforesaid opinion of
counsel for the holder, such legend is not required in
order to insure compliance with the Act. Nothing herein
shall restrict the transfer of this Warrant or any portion
hereof by the initial holder hereof to any partnership
affiliated with the initial holder, or to any partner of
any such partnership provided such transfer may be made in
compliance with applicable federal and state securities
laws. The Company may issue stop transfer instructions to
its transfer agent in connection with the foregoing
restrictions.
15. Notices, Etc. All notices and other communications from
Rocketinfo to the Holder of this Warrant shall be mailed by first class
registered or certified mail, postage prepaid, at such address as may
have been furnished to Rocketinfo in writing by such Holder or, until
any such Holder furnishes to Rocketinfo any address, then to, and at
the address of, the last Holder of this Warrant who has so furnished an
address to Rocketinfo.
16. Miscellaneous. This Warrant and any term hereof may be
changed, waived, discharged or terminated only by an instrument in
writing signed by the party against which enforcement of such change,
waiver, discharge or termination is sought. This Warrant shall be
construed and enforced in accordance with and governed by the internal
laws of the State of Colorado. The headings in this Warrant are for the
purposes of reference only, and shall not limit or otherwise affect any
of the terms hereof. The invalidity or unenforceability of any
provision hereof shall in no way affect the validity or enforceability
of any other provision.
DATED for reference as of August ____, 2006.
ROCKETINFO, INC.
____________________________
By: __________
Title: President and Chief Executive Officer
___________________________________
By: ____________
Title: Chief Financial Officer
Countersigned by:
COMPUTERSHARE TRUST COMPANY, INC.
Warrant Registrar and Transfer Agent
_________________________________
Per: Authorized Signatory
ANNEX ?A?
FORM OF NOTICE EXERCISE - WARRANT
(To be executed only on exercise of the Warrant in whole or in part)
To: Rocketinfo, Inc.
0 Xxxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxx Xxx, Xxxxxxxxxx 00000
The undersigned registered Holder of the accompanying Warrant, hereby
exercises such Warrant or portion thereof for, and purchases
thereunder, __________(1) shares of Common Stock (as defined in such
Warrant) and herewith makes payment therefor in the amount and manner
set forth below, as of the date written below. The undersigned requests
that the certificates for such shares of Common Stock be issued in the
name of, and delivered to,________________________ whose address
is___________________________________________________ .
The Exercise Price is paid as follows:
Certified Bank draft payable to Rocketinfo in the amount of
$____________.
election to exercise its net issuance rights pursuant to
Section 1.1(c) of the attached Warrant with respect to __________
shares of Common Stock.
Wire transfer to the account of Rocketinfo in the amount of
$___________.
On exercise pursuant to this Notice of Exercise, the Holder will be in
compliance with the Limitation on Exercise (as defined in the
Securities Warrant Agreement pursuant to which this Warrant was
issued). The Holder of the shares of Common Stock received on exercise
of the Warrant (the "Common Shares"), covenants and agrees that the
Common Shares are being acquired as an investment and not with a view
to the distribution thereof in violation of the Securities Act and that
the Common Shares may not be transferred, sold, assigned, hypothecated
or otherwise disposed of, in whole or in part except as provided in the
legend on the first page of this Warrant and provided that the Holder
shall have furnished Rocketinfo an opinion of counsel in form and
substance reasonably acceptable to Rocketinfo to the effect that such
transfer is exempt from the registration requirements of the Securities
Act and any applicable state securities laws.*
The undersigned represents that:
[PLEASE CHECK ONE BOX]
It is not a U.S. person (as defined in Regulation S under the
U.S. Securities Act of 1933, as amended), is acquiring the
shares for its own account and not for the account or benefit of
a U.S. person and has executed and delivered this Election
outside the United States.
Accompanying this Election is a Representation Letter in the form
attached as Annex ?C? to the Warrant Certificate.
This Election has been executed and delivered in _____________.
Date:
(Name must conform to name of Holder as specified on the face of the
Warrant)
By:
Name:
Title:
Date of Exercise: Address of Holder:
* If shares of common Stock are to be issued to anyone other than the
Holder, this covenant and representation must be made by such other
Person.
___________________________________
1. Insert the number of shares of Common Stock as to which the
accompanying Warrant is being exercised. In the case of partial
exercise, a new Warrant or Warrant will be issued and delivered,
representing the unexercised portion of the accompanying Warrant, to
the Holder surrendering the same.
ANNEX ?B?
WARRANT EXERCISE LEDGER
Original Exercise New
Date Number of Warrants Price Balance of Holder?s Issuer?s
Warrants Exercised Paid Warrants Initials Initials
--------------------------------------------------------------------------------------
ROCKETINFO, INC. Holder:
_____________________________ ___________________________
By: ____________ By: ______________
Title: Chairman & Director _______________________
Address: Rocketinfo, Inc. Address:___________________
0 Xxxxxx Xxxxxx Xxxxx, ___________________
Suite 1200, ___________________
Xxxxx Xxx, Xxxxxxxxxx 00000 ___________________
Tel: (___) ________ Tel: (___) _________
Fax.: (___) ________ Fax: (___) _________
ANNEX ?C?
REPRESENTATION LETTER
Rocketinfo, Inc.
0000 Xxxxx Xxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000-0000
Ladies and Gentlemen:
In connection with the purchase by the undersigned on this date of
common shares (the "Securities") of Rocketinfo, Inc. (the "Company"),
the undersigned hereby confirms to you that:
1. The undersigned:
a. is an "accredited investor" as defined in Rule 501(a)(1) of
Regulation D under the United States Securities Act of 1933, as
amended (the "Act") because it is a broker-dealer registered
pursuant to Section 15 of the United States Securities Exchange
Act of 1934, as amended; and
b. is purchasing the Securities for its own account and not with
a view to resale, distribution or other disposition in a manner
that would violate the registration requirements of the Act.
2. It acknowledges that neither the Securities nor any interest
therein has been or will be registered under the Act or the securities
laws of any State or other political subdivision of the United States.
3. It further acknowledges and agrees that, because the Securities
have not been registered under the Act and are being deemed to offered
and sold in a private offering under the exemption afforded by Section
4(2)of the Act, the Shares are "restricted securities" within the
meaning of Rule 144(a)(3) under the Act and cannot be reoffered or
resold unless they are subsequently registered under the Securities Act
or an exemption from registration thereunder is available, and that it
will continue to bear the economic risk of its investment in the Shares
for an indefinite period of time.
4. It agrees that it will not re-offer, resell, pledge, hypothecate or
otherwise transfer or dispose of the Securities (or securities that may
be received in replacement thereof or in exchange therefore) except:
a. pursuant to an effective registration statement under the
Securities Act;
b. in a transaction outside the United States meeting the
requirements of Rule 904 of Regulation S under the Act; or
c. in a transaction exempt from registration under the
Securities Act and, in each case in compliance with any
applicable state securities ("Blue Sky") laws.
It agrees that in connection with any transaction pursuant to the
foregoing clause (c), it will furnish to the Company a written
opinion of counsel acceptable to the Company to the effect that
such offer, sale, pledge, hypothecation, transfer or disposition
is in compliance with the registration requirements of all
applicable United States federal and state securities laws. It
acknowledges and agrees that each certificate for the Securities
(and any certificate issued in replacement therefore) shall bear
a restrictive legend in substantially the following form and that
an appropriate stop transfer order implementing the same shall be
lodged with the transfer agent:
"The securities represented hereby have not been and will
not be registered under the United States Securities Act of
1933, as amended (the "Act"). These securities may be
offered, sold, pledged or otherwise transferred only (a) to
the corporation, (b) in a transaction outside the United
States in compliance with Rule 904 of Regulation S under
the Act, or (c) in a transaction exempt from the
registration requirements under the Act and any applicable
state securities laws. In connection with any transfer
pursuant to the foregoing clause (c), there must be
furnished to the corporation a written opinion of counsel
reasonably acceptable to the corporation to the effect that
such transfer is exempt from the regulation requirements of
all applicable United States federal and state securities
laws."
5. The undersigned has such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of
an investment in the Securities. It acknowledges that it has had access
to such information concerning the Company as it has deemed necessary
to make an informed decision to purchase Securities, and has been
afforded the opportunity to ask questions and receive satisfactory
answers from representatives of the Company regarding the Company and
the terms and conditions relating to investment in the Company, and all
such questions have been answered to its full satisfaction.
Very truly yours,
EXHIBIT ?E?
OPTION AGREEMENT
INDIVIDUAL STOCK OPTION AGREEMENT
PURSUANT TO ROCKETINFO, INC.?S 2006 STOCK OPTION PLAN
THIS AGREEMENT is entered into as of 25th day of August, 2006 (the "Date
of Grant")
BETWEEN:
ROCKETINFO, INC., a corporation incorporated pursuant to the laws
of State of Delaware, having a business office at 0 Xxxxxx Xxxxxx
Xxxxx, Xxxxx 0000, Xxxxx Xxx, Xxxxxxxxxx 00000;
(the "Company")
AND:
XXXXX XXXXX, of 6 Hertford, Xxxxxxx Xxxxx, Xxxxxxxxxx 00000.
(the "Optionee")
WHEREAS:
A. The Board of Directors of the Company (the "Board") has
approved and adopted the 2006 Stock Option Plan (the "Plan"),
pursuant to which the Board is authorized to grant to employees and
other selected persons stock options to purchase common stock,
without par value, of the Company (the "Common Stock");
B. The Plan provides for the granting of stock options that either
(i) are intended to qualify as "Incentive Stock Options" within the
meaning of Section 422 of the Internal Revenue Code of 1986, as
amended (the "Code"), or (ii) do not qualify under Section 422 of
the Code ("Non-Qualified Stock Options"); and
C. The Board has authorized the grant to Optionee of options to
purchase a total of two million (2,000,000) shares of Common Stock
(the "Options"), which Options are intended to be (select one):
___ Incentive Stock Options; or
_X_ Non-Qualified Stock Options;
NOW THEREFORE, the Company agrees to offer to the Optionee the option
to purchase, upon the terms and conditions set forth herein and in the
Plan, two million (2,000,000) shares of Common Stock. Capitalized terms
not otherwise defined herein shall have the meanings ascribed thereto
in the Plan.
1. Exercise Price and Duration. The Options shall be exercisable
until 4:00 p.m. (Pacific Standard Time) on that day (the "Expiration
Date") that is three years following the Date of Grant, at an
exercise price of US$0.20 per share; provided that in accordance
with Section 5.1(d) of the Plan:
a. the Expiration Date of any Incentive Stock Option granted
to a greater than ten percent (> 10%) shareholder of the
Company shall not be later than three (3) years from the Date
of Grant);
b. so long as the Company's Common Stock is traded on a
Designated Exchange (as defined in the Plan), all Options
granted pursuant to the Plan shall expire not later than three
(3) years from the Date of Grant; and
c. if the Common Shares are not traded on a Designated
Exchange and in the absence of action to the contrary by the
Plan Administrator (as defined in the Plan) in connection with
the grant of a particular Option, and except in the case of
Incentive Stock Options as described above, all Options
granted under the Plan shall expire not later than ten (10)
years from the Date of Grant.
2. Limitation on the Number of Shares. If the Options granted
hereby are Incentive Stock Options, the number of shares which may
be acquired upon exercise thereof is subject to the limitations set
forth in Section 5.1(a) of the Plan.
3. Vesting Schedule. The Options to granted hereunder vest
immediately and are therefore Non-Qualified Stock Options.
a. If the Options granted hereby are Non-Qualified Stock
Options, they shall vest as of the Date of Grant.
b. If the Options granted hereby are Incentive Stock Options,
they shall vest as follows: Not Applicable ? Vests
Immediately.
Total Incentive Stock Option Vested Date
1,000,000 December 31, 2006
1,000,000 December 31, 2007
1,000,000 December 31, 2008
4. Options not Transferable. The Options may not be transferred,
assigned, pledged or hypothecated in any manner (whether by
operation of law or otherwise) other than by will or by applicable
laws of descent and distribution, and shall not be subject to
execution, attachment or similar process. In the event of an
Optionee's death, any Option held by the Optionee shall be
exercisable only by the person or persons to whom such Optionee's
rights under such Option shall pass by the Optionee's will or by the
laws of descent and distribution. Upon any attempt to transfer,
pledge, hypothecate or otherwise dispose of any Option or of any
right or privilege conferred by the Plan contrary to the provisions
thereof, or upon the sale, levy or attachment or similar process
upon the rights and privileges conferred by the Plan, such Option
shall thereupon terminate and become null and void.
5. Investment Intent. By accepting the Options, the Optionee
represents and agrees that none of the shares of Common Stock
purchased upon exercise of the Options will be distributed in
violation of applicable federal and state laws and regulations. In
addition, the Company may require, as a condition of exercising the
Options, that the Optionee execute an undertaking, in such a form as
the Company shall reasonably specify, that the Stock is being
purchased only for investment and without any then-present intention
to sell or distribute such shares.
6. Termination of Options. Vested Options shall terminate, to the
extent not previously exercised, upon the occurrence of the first of
the following events:
a. Expiration. December 31, 2009.
b. Termination for Cause. The date of an Optionee's
termination of employment or contractual relationship with the
Company or any Related Corporation (as defined in the Plan)
for cause (as determined in the sole discretion of the Plan
Administrator, acting reasonably).
c. Termination Due to Death or Disability. The expiration of
one (1) year from the date of the death of the Optionee, or
the expiration of six (6) months from termination of an
Optionee's employment or contractual relationship by reason of
Disability (as defined in Section 5(g) of the Plan).
d. Termination for Any Other Reason. The expiration of thirty
(30) days from the date of an Optionee's termination of
employment or contractual relationship with the Company or any
Related Corporation for any reason whatsoever other than
cause, death or Disability.
e. Number of Shares Exercisable. Notwithstanding all Options
having been vested, the number of Options exercisable by the
Optionee under subsection 6(d) shall be adjusted in accordance
to the number of years the Optionee has been with the Company.
The Optionee shall be entitled to exercise 100% of the vested
Options if the employment or contractual relationship with the
Company was terminated after three years. The Optionee shall
otherwise only be entitled to exercise 25% of the vested
Options on a pro rata basis for each year the Optionee is
employed or in a contractual relationship with the Company
starting at the beginning of each year.
7. Termination of Options Granted in the Optionee's Capacity as a
Director. Notwithstanding Section 6, any Options that have vested
and which have been granted to the Optionee in the Optionee's
capacity as a director of the Company or a Related Corporation shall
terminate upon the occurrence of the first of the following events:
a. Expiration. December 31, 2009.
b. Termination for Cause. The date the Optionee is removed as
a director for cause (as determined in the sole discretion of
the Plan Administrator, acting reasonably).
c. Termination Due to Death or Disability. The expiration of
one (1) year from the date of the death of the Optionee, or
the expiration of six (6) months from cessation of the
Optionee's service as a director of the Company or Related
Corporation, as the case may be, by reason of Disability.
d. Termination Due to Cessation of Service as a Director. The
expiration of thirty (30) days from the date the Optionee
ceases to serve as a director of the Company or Related
Corporation, as the case may be, unless the Optionee continues
to be engaged by the Corporation as an Employee (as defined in
the Plan), officer or consultant in which event the terms of
the Option shall be governed by the provisions of Section 6.
8. Termination of Unvested Incentive Stock Options. Each unvested
Incentive Stock Option granted pursuant hereto shall terminate
immediately upon termination of the Optionee's employment or
contractual relationship with the Company for any reason whatsoever,
including death or Disability, unless vesting is accelerated in
accordance with the Plan.
9. Stock. In the case of any stock split, stock dividend or like
change in the nature of shares of Stock covered by this Agreement,
the number of shares and exercise price shall be proportionately
adjusted as set forth in Section 5(m) of the Plan.
10. Exercise of Option. Options shall be exercisable, in full or in
part, at any time after vesting, until termination; provided,
however, that any Optionee who is subject to the reporting and
liability provisions of Section 16 of the Securities Exchange Act of
1934 with respect to the Common Stock shall be precluded from
selling or transferring any Common Stock or other security
underlying an Option during the six (6) months immediately following
the grant of that Option. If less than all of the shares included in
the vested portion of any Option are purchased, the remainder may be
purchased at any subsequent time prior to the expiration or
termination of the Option. Only whole shares may be issued pursuant
to an Option, and to the extent that an Option covers less than one
(1) share, it is unexercisable.
Each exercise of the Options shall be by means of delivery of a
notice of election to exercise (which may be in the form attached
hereto as Exhibit A) to the Chief Financial Officer of the
Company at its principal executive office, specifying the number
of shares of Common Stock to be purchased and accompanied by
payment in cash by certified check or cashier's check in the
amount of the full exercise price for the Common Stock to be
purchased.
11. Holding Period for Incentive Stock Options. In order to obtain
the tax treatment provided for Incentive Stock Options by Section
422 of the Code, the shares of Common Stock received upon exercising
any Incentive Stock Options received pursuant to this Agreement must
be sold, if at all, after a date which is later of two (2) years
from the date of this agreement is entered into or one (1) year from
the date upon which the Options are exercised. The Optionee agrees
to report sales of shares prior to the above determined date to the
Company within one (1) business day after such sale is concluded.
The Optionee also agrees to pay to the Company, within five (5)
business days after such sale is concluded, the amount necessary for
the Company to satisfy its withholding requirement required by the
Code in the manner specified in Section 5.1(1)(iii) of the Plan.
Nothing in this Section is intended as a representation that Common
Stock may be sold without registration under state and federal
securities laws or an exemption therefrom or that such registration
or exemption will be available at any specified time.
12. Subject to 2006 Stock Option Plan. The terms of the Options are
subject to the provisions of the Plan, as the same may from time to
time be amended, and any inconsistencies between this Agreement and
the Plan, as the same may be from time to time amended, shall be
governed by the provisions of the Plan, a copy of which has been
delivered to the Optionee, and which is available for inspection at
the principal offices of the Company.
13. Professional Advice. The acceptance of the Options and the sale
of Common Stock issued pursuant to the exercise of Options may have
consequences under federal and state tax and securities laws which
may vary depending upon the individual circumstances of the
Optionee. Accordingly, the Optionee acknowledges that he or she has
been advised to consult his or her personal legal and tax advisor in
connection with this Agreement and his or her dealings with respect
to Options for the Common Stock. Without limiting other matters to
be considered, the Optionee should consider whether upon the
exercise of Options, the Optionee will file an election with the
Internal Revenue Service pursuant to Section 83(b) of the Code.
14. No Employment Relationship. Whether or not any Options are to
be granted under this Plan shall be exclusively within the
discretion of the Plan Administrator, and nothing contained in this
Plan shall be construed as giving any person any right to
participate under this Plan. The grant of an Option shall in no way
constitute any form of agreement or understanding binding on the
Company or any Related Corporation, express or implied, that the
Company or any Related Corporation will employ or contract with an
Optionee for any length of time, nor shall it interfere in any way
with the Company's or, where applicable, a Related Corporation's
right to terminate Optionee's employment at any time, which right is
hereby reserved.
15. Entire Agreement. This Agreement is the only agreement between
the Optionee and the Company with respect to the Options, and this
Agreement and the Plan supersede all prior and contemporaneous oral
and written statements and representations and contain the entire
agreement between the parties with respect to the Options.
16. Proper Law. This Agreement will be governed by and construed in
accordance with the laws of the State of California.
17. Notices. Any notice required or permitted to be made or given
hereunder shall be mailed or delivered personally to the addresses
set forth below, or as changed from time to time by written notice
to the other:
The Company:
Rocketinfo, Inc.
0 Xxxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxx Xxx, Xxxxxxxxxx 00000
Attention: Chief Financial Officer
The Optionee:
RBH Consulting Inc.
000-0000 Xxx Xxx Xxx.,
Xxxxxxxx, XX Xxxxxx
18. Counterparts. This Agreement may be executed in several
counterparts, each of which will be deemed to be an original and all
of which will together constitute one and the same instrument.
19. Electronic Means. Delivery of an executed copy of this
Agreement by electronic facsimile transmission or other means of
electronic communication capable of producing a printed copy will be
deemed to be execution and delivery of this Agreement as of the Date
of Grant.
IN WITNESS WHEREOF the parties have executed and delivered this
Agreement as of the date first above written.
ROCKETINFO, INC.
Per:
Authorized Signatory
SIGNED, SEALED and DELIVERED by OPTIONEE:
RBH FAMILY TRUST in the presence of:
_________________________________ RBH FAMILY TRUST
Signature
__________________________________
Print Name
__________________________________
Address
__________________________________ ___________________________
Occupation Authorized Signatory
THERE MAY NOT BE PRESENTLY AVAILABLE EXEMPTIONS FROM THE REGISTRATION
REQUIREMENTS OF APPLICABLE FEDERAL AND STATE SECURITIES LAWS FOR THE
ISSUANCE OF SHARES OF STOCK UPON EXERCISE OF THESE OPTIONS.
ACCORDINGLY, THESE OPTIONS CANNOT BE EXERCISED UNLESS THESE OPTIONS AND
THE SHARES OF STOCK TO BE ISSUED UPON EXERCISE OF THESE OPTIONS ARE
REGISTERED OR AN EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS IS
AVAILABLE.
THE SHARES OF STOCK ISSUED PURSUANT TO THE EXERCISE OF OPTIONS WILL BE
"RESTRICTED SECURITIES" AS DEFINED IN RULE 144 UNDER THE SECURITIES ACT
OF 1933 AND WILL BEAR A LEGEND RESTRICTING RESALE UNLESS THEY ARE
REGISTERED UNDER STATE AND FEDERAL SECURITIES LAWS OR AN EXEMPTION FROM
REGISTRATION IS AVAILABLE. THE COMPANY IS NOT OBLIGATED TO REGISTER THE
SHARES OF STOCK OR TO MAKE AVAILABLE ANY EXEMPTION FROM REGISTRATION.
WHEREAS:
The Company:
Rocketinfo, Inc.
0 Xxxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxx Xxx, Xxxxxxxxxx 00000
Attention: Chief Financial Officer
The Optionee:
Xxxxx Xxxxx
6 Hertford, Xxxxxxx Xxxxx
Xxxxxxxxxx 00000
Counterparts. This Agreement may be executed in several
counterparts, each of which will be deemed to be an original and all
of which will together constitute one and the same instrument.
Electronic Means. Delivery of an executed copy of this Agreement by
electronic facsimile transmission or other means of electronic
communication capable of producing a printed copy will be deemed to
be execution and delivery of this Agreement as of the Date of Grant.
IN WITNESS WHEREOF the parties have executed and delivered this
Agreement as of the date first above written.
ROCKETINFO, INC.
Per:
Authorized Signatory
SIGNED, SEALED and DELIVERED by Xxxxx Xxxxx in the presence of:
__________________________________
Signature
__________________________________
Print Name
__________________________________
Address
__________________________________
Occupation
________________________________
XXXXX XXXXX, OPTIONEE
THERE MAY NOT BE PRESENTLY AVAILABLE EXEMPTIONS FROM THE REGISTRATION
REQUIREMENTS OF APPLICABLE FEDERAL AND STATE SECURITIES LAWS FOR THE
ISSUANCE OF SHARES OF STOCK UPON EXERCISE OF THESE OPTIONS.
ACCORDINGLY, THESE OPTIONS CANNOT BE EXERCISED UNLESS THESE OPTIONS AND
THE SHARES OF STOCK TO BE ISSUED UPON EXERCISE OF THESE OPTIONS ARE
REGISTERED OR AN EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS IS
AVAILABLE. THE SHARES OF STOCK ISSUED PURSUANT TO THE EXERCISE OF
OPTIONS WILL BE "RESTRICTED SECURITIES" AS DEFINED IN RULE 144 UNDER
THE SECURITIES ACT OF 1933 AND WILL BEAR A LEGEND RESTRICTING RESALE
UNLESS THEY ARE REGISTERED UNDER STATE AND FEDERAL SECURITIES LAWS OR
AN EXEMPTION FROM REGISTRATION IS AVAILABLE. THE COMPANY IS NOT
OBLIGATED TO REGISTER THE SHARES OF STOCK OR TO MAKE AVAILABLE ANY
EXEMPTION FROM REGISTRATION.
EXHIBIT A
Notice of Election to Exercise
To: Rocketinfo, Inc.
Attention: The Chief Financial Officer
This Notice of Election to Exercise shall constitute proper notice
pursuant to the 2006 Stock Option Plan (the "Plan") of Rocketinfo, Inc.
(the "Company") and Section 10 of that certain Stock Option Agreement
(the "Agreement") dated as of the _____ day of August 2006, between the
Company and the undersigned.
The undersigned hereby elects to exercise Optionee's option to purchase
shares of the common stock of the Company at a price of US$ _______ per
share, for aggregate consideration of US$ __________, on the terms and
conditions set forth in the Agreement and the Plan. Such aggregate
consideration, in the form specified in Section 10 of the Agreement,
accompanies this notice.
The undersigned has executed this Notice this _______ day of
____________, _______.
Signature
Name (typed or printed)
Rocketinfo, Inc.
2006 Stock Plan
1. Establishment, Purpose and Term of Plan.
1.1 Establishment. The Rocketinfo, Inc. 2006 Stock Plan (the
?Plan?) is hereby adopted March 6, subject to approval by the
stockholders of the Company (the date of such approval, the ?Effective
Date?).
1.2 Purpose. The purpose of the Plan is to advance the interests
of the Participating Company Group and its stockholders by providing an
incentive to attract and retain the best qualified personnel to perform
services for the Participating Company Group, by motivating such
persons to contribute to the growth and profitability of the
Participating Company Group, by aligning their interests with interests
of the Company?s stockholders, and by rewarding such persons for their
services by tying a significant portion of their total compensation
package to the success of the Company. The Plan seeks to achieve this
purpose by providing for Awards in the form of Options, Stock
Appreciation Rights, Restricted Stock Awards, Performance Shares,
Performance Units, Restricted Stock Units, Deferred Compensation Awards
and other Stock-Based Awards as described below.
1.3 Term of Plan. The Plan shall continue in effect until the
earlier of its termination by the Board or the date on which all of the
shares of Stock available for issuance under the Plan have been issued
and all restrictions on such shares under the terms of the Plan and the
agreements evidencing Awards granted under the Plan have lapsed.
However, Awards shall not be granted later than ten (10) years from the
Effective Date. The Company intends that the Plan comply with Section
409A of the Code (including any amendments to or replacements of such
section), and the Plan shall be so construed.
2. Definitions and Construction.
2.1 Definitions. Whenever used herein, the following terms shall
have their respective meanings set forth below:
(a) ?Affiliate? means (i) an entity, other than a Parent
Corporation, that directly, or indirectly through one or more
intermediary entities, controls the Company or (ii) an entity, other
than a Subsidiary Corporation, that is controlled by the Company
directly, or indirectly through one or more intermediary entities. For
this purpose, the term ?control? (including the term ?controlled by?)
means the possession, direct or indirect, of the power to direct or
cause the direction of the management and policies of the relevant
entity, whether through the ownership of voting securities, by contract
or otherwise; or shall have such other meaning assigned such term for
the purposes of registration on Form S-8 under the Securities Act.
(b) ?Award? means any Option, SAR, Restricted Stock Award,
Performance Share, Performance Unit, Restricted Stock Unit or Deferred
Compensation Award or other Stock-Based Award granted under the Plan.
(c) ?Award Agreement? means a written agreement between the Company
and a Participant setting forth the terms, conditions and restrictions
of the Award granted to the Participant.
(d) ?Board? means the Board of Directors of the Company.
(e) ?Change in Control? means, unless such term or an equivalent
term is otherwise defined with respect to an Award by the Participant?s
Award Agreement or written contract of employment or service, the
occurrence of any of the following:
(i) an Ownership Change Event or a series of related Ownership
Change Events (collectively, a ?Transaction?) in which the stockholders
of the Company immediately before the Transaction do not retain
immediately after the Transaction, in substantially the same
proportions as their ownership of shares of the Company?s voting stock
immediately before the Transaction, direct or indirect beneficial
ownership of more than fifty percent (50%) of the total combined voting
power of the outstanding voting securities of the Company or, in the
case of an Ownership Change Event described in Section 2.1(y)(iii), the
entity to which the assets of the Company were transferred (the
?Transferee?), as the case may be; or
(ii) the liquidation or dissolution of the Company.
For purposes of the preceding sentence, indirect beneficial ownership
shall include, without limitation, an interest resulting from ownership
of the voting securities of one or more corporations or other business
entities which own the Company or the Transferee, as the case may be,
either directly or through one or more subsidiary corporations or other
business entities. The Board shall have the right to determine whether
multiple sales or exchanges of the voting securities of the Company or
multiple Ownership Change Events are related, and its determination
shall be final, binding and conclusive.
(f) ?Code? means the Internal Revenue Code of 1986, as amended, and
any applicable regulations promulgated thereunder.
(g) ?Committee? means the Compensation Committee or other committee
of the Board duly appointed to administer the Plan and having such
powers as shall be specified by the Board. If no committee of the Board
has been appointed to administer the Plan, the Board shall exercise all
of the powers of the Committee granted herein, and, in any event, the
Board may in its discretion exercise any or all of such powers. The
Committee shall have the exclusive authority to administer the Plan and
shall have all of the powers granted herein, including, without
limitation, the power to amend or terminate the Plan at any time,
subject to the terms of the Plan and any applicable limitations imposed
by law.
(h) ?Company? means Rocketinfo, Inc., a Minnesota corporation, or
any Successor.
(i) ?Consultant? means a person engaged to provide consulting
or advisory services (other than as an Employee or a member of the
Board) to a Participating Company.
(j) ?Deferred Compensation Award? means an award of Stock Units
granted to a Participant pursuant to Section 11 of the Plan.
(k ?Director? means a member of the Board or of the board of
directors of any Participating Company.
(l) ?Disability? means the permanent and total disability of the
Participant, within the meaning of Section 22(e)(3) of the Code.
(m) ?Dividend Equivalent? means a credit, made at the discretion of
the Committee or as otherwise provided by the Plan, to the account of a
Participant in an amount equal to the cash dividends paid on one share
of Stock for each share of Stock represented by an Award held by such
Participant.
(n) ?Employee? means any person treated as an employee (including
an Officer or a member of the Board who is also treated as an employee)
in the records of a Participating Company and, with respect to any
Incentive Stock Option granted to such person, who is an employee for
purposes of Section 422 of the Code; provided, however, that neither
service as a member of the Board nor payment of a director?s fee shall
be sufficient to constitute employment for purposes of the Plan. The
Company shall determine in good faith and in the exercise of its
discretion whether an individual has become or has ceased to be an
Employee and the effective date of such individual?s employment or
termination of employment, as the case may be. For purposes of an
individual?s rights, if any, under the Plan as of the time of the
Company?s determination, all such determinations by the Company shall
be final, binding and conclusive, notwithstanding that the Company or
any court of law or governmental agency subsequently makes a contrary
determination.
(o) ?Exchange Act? means the Securities Exchange Act of 1934, as
amended.
(p) ?Fair Market Value? means, as of any date, the value of a
share of Stock or other property as determined by the Committee, in its
discretion, or by the Company, in its discretion, if such determination
is expressly allocated to the Company herein, subject to the following:
(i) Except as otherwise determined by the Committee, if, on
such date, the Stock is listed on a national or regional securities
exchange or market system, the Fair Market Value of a share of Stock
shall be the closing price of a share of Stock as quoted on such
national or regional securities exchange or market system constituting
the primary market for the Stock on the last trading day prior to the
day of determination, as reported in The Wall Street Journal or such
other source as the Company deems reliable.
(ii) Notwithstanding the foregoing, the Committee may, in its
discretion, determine the Fair Market Value on the basis of the
closing, high, low or average sale price of a share of Stock or the
actual sale price of a share of Stock received by a Participant, on
such date, the preceding trading day, the next succeeding trading day
or an average determined over a period of trading days. The Committee
may vary its method of determination of the Fair Market Value as
provided in this Section for different purposes under the Plan.
(iii) If, on such date, the Stock is not listed on a national
or regional securities exchange or market system, the Fair Market Value
of a share of Stock shall be as determined by the Committee in good
faith without regard to any restriction other than a restriction which,
by its terms, will never lapse.
(q) ?Incentive Stock Option? means an Option intended to be (as set
forth in the Award Agreement) and which qualifies as an incentive stock
option within the meaning of Section 422(b) of the Code.
(r) ?Insider? means an Officer, a Director or any other person
whose transactions in Stock are subject to Section 16 of the Exchange
Act.
(s) ?Non-Control Affiliate? means any entity in which any
Participating Company has an ownership interest and which the Committee
shall designate as a Non-Control Affiliate.
(t) ? Nonemployee Director ? means a Director who is not an
Employee.
(u) ?Nonstatutory Stock Option? means an Option not intended to be
(as set forth in the Award Agreement) an incentive stock option within
the meaning of Section 422(b) of the Code.
(v) ?Officer? means any person designated by the Board as an
officer of the Company.
(w) ?Option? means the right to purchase Stock at a stated price
for a specified period of time granted to a Participant pursuant to
Section 6 of the Plan. An Option may be either an Incentive Stock
Option or a Nonstatutory Stock Option.
(x) ?Option Expiration Date? means the date of expiration of the
Option?s term as set forth in the Award Agreement.
(y) An ?Ownership Change Event? shall be deemed to have occurred if
any of the following occurs with respect to the Company: (i) the direct
or indirect sale or exchange in a single or series of related
transactions by the stockholders of the Company of more than fifty
percent (50%) of the voting stock of the Company; (ii) a merger or
consolidation in which the Company is a party; or (iii) the sale,
exchange, or transfer of all or substantially all, as determined by the
Board in its discretion, of the assets of the Company.
(z) ?Parent Corporation? means any present or future ?parent
corporation? of the Company, as defined in Section 424(e) of the Code.
(aa) ?Participant? means any eligible person who has been
granted one or more Awards.
(bb) ?Participating Company? means the Company or any Parent
Corporation, Subsidiary Corporation or Affiliate.
(cc) ?Participating Company Group? means, at any point in time,
all entities collectively which are then Participating Companies.
(dd) ?Performance Award? means an Award of Performance Shares
or Performance Units.
(ee) ?Performance Award Formula? means, for any Performance
Award, a formula or table established by the Committee pursuant to
Section 9.3 of the Plan which provides the basis for computing the
value of a Performance Award at one or more threshold levels of
attainment of the applicable Performance Goal(s) measured as of the end
of the applicable Performance Period.
(ff) ?Performance Goal? means a performance goal established by
the Committee pursuant to Section 9.3 of the Plan.
(gg) ?Performance Period? means a period established by the
Committee pursuant to Section 9.3 of the Plan at the end of which one
or more Performance Goals are to be measured.
(hh) ?Performance Share? means a bookkeeping entry representing
a right granted to a Participant pursuant to Section 9 of the Plan to
receive a payment equal to the value of a Performance Share, as
determined by the Committee, based on performance.
(ii) ?Performance Unit? means a bookkeeping entry representing
a right granted to a Participant pursuant to Section 9 of the Plan to
receive a payment equal to the value of a Performance Unit, as
determined by the Committee, based upon performance.
(jj) ?Restricted Stock Award? means an Award of Restricted
Stock.
(kk) ?Restricted Stock Unit? or ?Stock Unit? means a
bookkeeping entry representing a right granted to a Participant
pursuant to Section 10 or Section 11 of the Plan, respectively, to
receive a share of Stock on a date determined in accordance with the
provisions of Section 10 or Section 11, as applicable, and the
Participant?s Award Agreement.
(ll) ?Restriction Period? means the period established in
accordance with Section 8.4 of the Plan during which shares subject to
a Restricted Stock Award are subject to Vesting Conditions.
(mm) ?Rule 16b-3? means Rule 16b-3 under the Exchange Act, as
amended from time to time, or any successor rule or regulation.
(nn) ?SAR? or ?Stock Appreciation Right? means a bookkeeping
entry representing, for each share of Stock subject to such SAR, a
right granted to a Participant pursuant to Section 7 of the Plan to
receive payment in any combination of shares of Stock or cash of an
amount equal to the excess, if any, of the Fair Market Value of a share
of Stock on the date of exercise of the SAR over the exercise price.
(oo) ?Section 162(m)? means Section 162(m) of the Code.
(pp) ?Securities Act? means the Securities Act of 1933, as
amended.
(qq) ?Service? means a Participant?s employment or service with
the Participating Company Group, whether in the capacity of an
Employee, a Director or a Consultant. Unless otherwise provided by the
Committee, a Participant?s Service shall not be deemed to have
terminated merely because of a change in the capacity in which the
Participant renders such Service or a change in the Participating
Company for which the Participant renders such Service, provided that
there is no interruption or termination of the Participant?s Service.
Furthermore, a Participant?s Service shall not be deemed to have
terminated if the Participant takes any military leave, sick leave, or
other bona fide leave of absence approved by the Company. However, if
any such leave taken by a Participant exceeds ninety (90) days, then on
the ninety-first (91st) day following the commencement of such leave
the Participant?s Service shall be deemed to have terminated, unless
the Participant?s right to return to Service is guaranteed by statute
or contract. Notwithstanding the foregoing, unless otherwise designated
by the Company or required by law, a leave of absence shall not be
treated as Service for purposes of determining vesting under the
Participant?s Award Agreement. A Participant?s Service shall be deemed
to have terminated either upon an actual termination of Service or upon
the entity for which the Participant performs Service ceasing to be a
Participating Company. Subject to the foregoing, the Company, in its
discretion, shall determine whether the Participant?s Service has
terminated and the effective date of such termination.
(rr) ?Stock? means the common stock of the Company, as adjusted
from time to time in accordance with Section 4.2 of the Plan.
(ss) ?Stock-Based Awards? means any award that is valued in
whole or in part by reference to, or is otherwise based on, the Stock,
including dividends on the Stock, but not limited to those Awards
described in Sections 6 through 11 of the Plan.
(tt) ?Subsidiary Corporation? means any present or future
?subsidiary corporation? of the Company, as defined in Section 424(f)
of the Code.
(uu) ?Successor? means a corporation into or with which the
Company is merged or consolidated or which acquires all or
substantially all of the assets of the Company and which is designated
by the Board as a Successor for purposes of the Plan.
(vv) ?Ten Percent Owner? means a Participant who, at the time
an Option is granted to the Participant, owns stock possessing more
than ten percent (10%) of the total combined voting power of all
classes of stock of a Participating Company (other than an Affiliate)
within the meaning of Section 422(b)(6) of the Code.
(ww) ?Vesting Conditions? means those conditions established in
accordance with Section 8.4 or Section 10.2 of the Plan prior to the
satisfaction of which shares subject to a Restricted Stock Award or
Restricted Stock Unit Award, respectively, remain subject to forfeiture
or a repurchase option in favor of the Company upon the Participant?s
termination of Service.
2.2 Construction. Captions and titles contained herein are for
convenience only and shall not affect the meaning or interpretation of
any provision of the Plan. Except when otherwise indicated by the
context, the singular shall include the plural and the plural shall
include the singular. Use of the term ?or? is not intended to be
exclusive, unless the context clearly requires otherwise.
3. Administration.
3.1 Administration by the Committee. The Plan shall be administered
by the Committee. All questions of interpretation of the Plan or of any
Award shall be determined by the Committee, and such determinations
shall be final and binding upon all persons having an interest in the
Plan or such Award.
3.2 Authority of Officers. Any Officer shall have the authority to
act on behalf of the Company with respect to any matter, right,
obligation, determination or election which is the responsibility of or
which is allocated to the Company herein, provided the Officer has
apparent authority with respect to such matter, right, obligation,
determination or election.
3.3 Administration with Respect to Insiders. With respect to
participation by Insiders in the Plan, at any time that any class of
equity security of the Company is registered pursuant to Section 12 of
the Exchange Act, the Plan shall be administered in compliance with the
requirements, if any, of Rule 16b-3.
3.4 Committee Complying with Section 162(m). While the Company is a
?publicly held corporation? within the meaning of Section 162(m), the
Board may establish a Committee of ?outside directors? within the
meaning of Section 162(m) to approve the grant of any Award which might
reasonably be anticipated to result in the payment of employee
remuneration that would otherwise exceed the limit on employee
remuneration deductible for income tax purposes pursuant to Section
162(m).
3.5 Powers of the Committee. In addition to any other powers set
forth in the Plan and subject to the provisions of the Plan, the
Committee shall have the full and final power and authority, in its
discretion:
(a) to determine the persons to whom, and the time or times at
which, Awards shall be granted and the number of shares of Stock or
units to be subject to each Award;
(b) to determine the type of Award granted and to designate
Options as Incentive Stock Options or Nonstatutory Stock Options;
(c) to determine the Fair Market Value of shares of Stock or
other property;
(d) to determine the terms, conditions and restrictions
applicable to each Award (which need not be identical) and any shares
acquired pursuant thereto, including, without limitation, (i) the
exercise or purchase price of shares purchased pursuant to any Award,
(ii) the method of payment for shares purchased pursuant to any Award,
(iii) the method for satisfaction of any tax withholding obligation
arising in connection with Award, including by the withholding or
delivery of shares of Stock, (iv) the timing, terms and conditions of
the exercisability or vesting of any Award or any shares acquired
pursuant thereto, (v) the Performance Award Formula and Performance
Goals applicable to any Award and the extent to which such Performance
Goals have been attained, (vi) the time of the expiration of any Award,
(vii) the effect of the Participant?s termination of Service on any of
the foregoing, and (viii) all other terms, conditions and restrictions
applicable to any Award or shares acquired pursuant thereto not
inconsistent with the terms of the Plan;
(e) to determine whether an Award will be settled in shares of
Stock, cash, or in any combination thereof;
(f) to approve one or more forms of Award Agreement;
(g) to amend, modify, extend, cancel or renew any Award or to
waive any restrictions or conditions applicable to any Award or any
shares acquired pursuant thereto;
(h) to accelerate, continue, extend or defer the
exercisability or vesting of any Award or any shares acquired pursuant
thereto, including with respect to the period following a Participant?s
termination of Service;
(i) without the consent of the affected Participant and
notwithstanding the provisions of any Award Agreement to the contrary,
to unilaterally substitute at any time a Stock Appreciation Right
providing for settlement solely in shares of Stock in place of any
outstanding Option, provided that such Stock Appreciation Right covers
the same number of shares of Stock and provides for the same exercise
price (subject in each case to adjustment in accordance with Section
4.2) as the replaced Option and otherwise provides substantially
equivalent terms and conditions as the replaced Option, as determined
by the Committee;
(j) to prescribe, amend or rescind rules, guidelines and
policies relating to the Plan, or to adopt sub-plans or supplements to,
or alternative versions of, the Plan, including, without limitation, as
the Committee deems necessary or desirable to comply with the laws or
regulations of or to accommodate the tax policy, accounting principles
or custom of, foreign jurisdictions whose citizens may be granted
Awards;
(k) to correct any defect, supply any omission or reconcile
any inconsistency in the Plan or any Award Agreement and to make all
other determinations and take such other actions with respect to the
Plan or any Award as the Committee may deem advisable to the extent not
inconsistent with the provisions of the Plan or applicable law; and
(l) to delegate to any proper Officer the authority to grant
one or more Awards, without further approval of the Committee, to any
person eligible pursuant to Section 5, other than a person who, at the
time of such grant, is an Insider; provided, however, that (i) the
exercise price per share of each such Option shall be equal to the Fair
Market Value per share of the Stock on the effective date of grant, and
(ii) each such Award shall be subject to the terms and conditions of
the appropriate standard form of Award Agreement approved by the
Committee and shall conform to the provisions of the Plan and such
other guidelines as shall be established from time to time by the
Committee.
3.6 Indemnification. In addition to such other rights of
indemnification as they may have as members of the Board or the
Committee or as officers or employees of the Participating Company
Group, members of the Board or the Committee and any officers or
employees of the Participating Company Group to whom authority to act
for the Board, the Committee or the Company is delegated shall be
indemnified by the Company against all reasonable expenses, including
attorneys? fees, actually and necessarily incurred in connection with
the defense of any action, suit or proceeding, or in connection with
any appeal therein, to which they or any of them may be a party by
reason of any action taken or failure to act under or in connection
with the Plan, or any right granted hereunder, and against all amounts
paid by them in settlement thereof (provided such settlement is
approved by independent legal counsel selected by the Company) or paid
by them in satisfaction of a judgment in any such action, suit or
proceeding, except in relation to matters as to which it shall be
adjudged in such action, suit or proceeding that such person is liable
for gross negligence, bad faith or intentional misconduct in duties;
provided, however, that within sixty (60) days after the institution of
such action, suit or proceeding, such person shall offer to the
Company, in writing, the opportunity at its own expense to handle and
defend the same.
3.7 Arbitration. Any dispute or claim concerning any Awards granted
(or not granted) pursuant to this Plan and any other disputes or claims
relating to or arising out of the Plan shall be fully, finally and
exclusively resolved by binding arbitration conducted pursuant to the
Commercial Arbitration Rules of the American Arbitration Association.
By accepting an Award, Participants and the Company waive their
respective rights to have any such disputes or claims tried by a judge
or jury.
3.8 Repricing Prohibited. Without the affirmative vote of holders
of a majority of the shares of Stock cast in person or by proxy at a
meeting of the stockholders of the Company at which a quorum
representing a majority of all outstanding shares of Stock is present
or represented by proxy, the Committee shall not approve a program
providing for either (a) the cancellation of outstanding Options or
SARs and the grant in substitution therefore of new Options or SARs
having a lower exercise price or (b) the amendment of outstanding
Options or SARs to reduce the exercise price thereof. This paragraph
shall not be construed to apply to the issuance or assumption of an
Award in a transaction to which Code section 424(a) applies, within the
meaning of Section 424 of the Code.
4. Shares Subject to Plan.
4.1 Maximum Number of Shares Issuable. Subject to adjustment as
provided in Section 4.2, the maximum aggregate number of shares of
Stock that may be issued under the Plan shall be twelve million
(12,000,000) and shall consist of authorized but unissued or reacquired
shares of Stock or any combination thereof. If an outstanding Award for
any reason expires or is terminated or canceled without having been
exercised or settled in full, or if shares of Stock acquired pursuant
to an Award subject to forfeiture or repurchase are forfeited or
repurchased by the Company, the shares of Stock allocable to the
terminated portion of such Award or such forfeited or repurchased
shares of Stock shall again be available for issuance under the Plan.
Shares of Stock shall not be deemed to have been issued pursuant to the
Plan (a) with respect to any portion of an Award that is settled in
cash or (b) to the extent such shares are withheld or reacquired by the
Company in satisfaction of tax withholding obligations pursuant to
Section 15.2. Upon payment in shares of Stock pursuant to the exercise
of an SAR, the number of shares available for issuance under the Plan
shall be reduced only by the number of shares actually issued in such
payment. If the exercise price of an Option is paid by tender to the
Company, or attestation to the ownership, of shares of Stock owned by
the Participant, or by means of a Net-Exercise, the number of shares
available for issuance under the Plan shall be reduced only by the net
number of shares for which the Option is exercised.
4.2 Adjustments for Changes in Capital Structure. Subject to any
required action by the stockholders of the Company, in the event of any
change in the Stock effected without receipt of consideration by the
Company, whether through merger, consolidation, reorganization,
reincorporation, recapitalization, reclassification, stock dividend,
stock split, reverse stock split, split-up, split-off, spin-off,
combination of shares, exchange of shares, or similar change in the
capital structure of the Company, or in the event of payment of a
dividend or distribution to the stockholders of the Company in a form
other than Stock (excepting normal cash dividends) that has a material
effect on the Fair Market Value of shares of Stock, appropriate
adjustments shall be made in the number and kind of shares subject to
the Plan and to any outstanding Awards, in the Award limits set forth
in Section 5.4, and in the exercise or purchase price per share under
any outstanding Award in order to prevent dilution or enlargement of
Participants? rights under the Plan. For purposes of the foregoing,
conversion of any convertible securities of the Company shall not be
treated as ?effected without receipt of consideration by the Company.?
If a majority of the shares which are of the same class as the shares
that are subject to outstanding Awards are exchanged for, converted
into, or otherwise become (whether or not pursuant to an Ownership
Change Event) shares of another corporation (the ?New Shares?), the
Committee may unilaterally amend the outstanding Options to provide
that such Options are exercisable for New Shares. In the event of any
such amendment, the number of shares subject to, and the exercise price
per share of, the outstanding Awards shall be adjusted in a fair and
equitable manner as determined by the Board, in its discretion. Any
fractional share resulting from an adjustment pursuant to this Section
4.2 shall be rounded down to the nearest whole number. The Committee in
its sole discretion, may also make such adjustments in the terms of any
Award to reflect, or related to, such changes in the capital structure
of the Company or distributions as it deems appropriate, including
modification of Performance Goals, Performance Award Formulas and
Performance Periods. The adjustments determined by the Committee
pursuant to this Section 4.2 shall be final, binding and conclusive.
5. Eligibility and Award Limitations.
5.1 Persons Eligible for Awards. Awards may be granted only to
Employees, Consultants and Directors. For purposes of the foregoing
sentence, ?Employees,? ?Consultants? and ?Directors? shall include
prospective Employees, prospective Consultants and prospective
Directors to whom Awards are offered to be granted in connection with
written offers of an employment or other service relationship with the
Participating Company Group; provided, however, that no Stock subject
to any such Award shall vest, become exercisable or be issued prior to
the date on which such person commences Service.
5.2 Participation. Awards other than Nonemployee Director Awards
are granted solely at the discretion of the Committee. Eligible persons
may be granted more than one Award. However, eligibility in accordance
with this Section shall not entitle any person to be granted an Award,
or, having been granted an Award, to be granted an additional Award.
5.3 Incentive Stock Option Limitations.
(a) Persons Eligible. An Incentive Stock Option may be granted
only to a person who, on the effective date of grant, is an Employee of
the Company, a Parent Corporation or a Subsidiary Corporation (each
being an ?ISO-Qualifying Corporation?). Any person who is not an
Employee of an ISO-Qualifying Corporation on the effective date of the
grant of an Option to such person may be granted only a Nonstatutory
Stock Option. An Incentive Stock Option granted to a prospective
Employee upon the condition that such person become an Employee of an
ISO-Qualifying Corporation shall be deemed granted effective on the
date such person commences Service with an ISO-Qualifying Corporation,
with an exercise price determined as of such date in accordance with
Section 6.1.
(b) Fair Market Value Limitation. To the extent that options
designated as Incentive Stock Options (granted under all stock option
plans of the Participating Company Group, including the Plan) become
exercisable by a Participant for the first time during any calendar
year for stock having a Fair Market Value greater than One Hundred
Thousand Dollars ($100,000), the portion of such options which exceeds
such amount shall be treated as Nonstatutory Stock Options. For
purposes of this Section, options designated as Incentive Stock Options
shall be taken into account in the order in which they were granted,
and the Fair Market Value of stock shall be determined as of the time
the option with respect to such stock is granted. If the Code is
amended to provide for a limitation different from that set forth in
this Section, such different limitation shall be deemed incorporated
herein effective as of the date and with respect to such Options as
required or permitted by such amendment to the Code. If an Option is
treated as an Incentive Stock Option in part and as a Nonstatutory
Stock Option in part by reason of the limitation set forth in this
Section, the Participant may designate which portion of such Option the
Participant is exercising. In the absence of such designation, the
Participant shall be deemed to have exercised the Incentive Stock
Option portion of the Option first. Upon exercise, shares issued
pursuant to each such portion shall be separately identified.
5.4 Award Limits.
(a) Maximum Number of Shares Issuable Pursuant to Incentive
Stock Options. Subject to adjustment as provided in Section 4.2, the
maximum aggregate number of shares of Stock that may be issued under
the Plan pursuant to the exercise of Incentive Stock Options shall not
exceed twelve million (12,000,000) shares. The maximum aggregate number
of shares of Stock that may be issued under the Plan pursuant to all
Awards other than Incentive Stock Options shall be the number of shares
determined in accordance with Section 4.1, subject to adjustment as
provided in Section 4.2 and further subject to the limitation set forth
in Section 5.4(b) below.
(b) Aggregate Limit on Full Value Awards. Subject to adjustment
as provided in Section 4.2, in no event shall more than three million
six hundred thousand (3,600,000) shares in the aggregate be issued
under the Plan pursuant to the exercise or settlement of Restricted
Stock Awards, Restricted Stock Unit Awards and Performance Awards
(?Full Value Awards?). Except with respect to a maximum of one million
two hundred thousand (1,200,000) shares, any Full Value Awards which
vest on the basis of the Participant?s continued Service shall not
provide for vesting which is any more rapid than annual pro rata
vesting over a three (3) year period and any Full Value Awards which
vest upon the attainment of Performance Goals shall provide for a
Performance Period of at least twelve (12) months.
(c) Section 162(m) Award Limits. The following limits shall
apply to the grant of any Award if, at the time of grant, the Company
is a ?publicly held corporation? within the meaning of Section 162(m).
(i) Options and SARs. Subject to adjustment as provided in
Section 4.2, no Employee shall be granted within any fiscal year of the
Company one or more Options or Freestanding SARs which in the aggregate
are for more than three million (3,000,000) shares of Stock reserved
for issuance under the Plan.
(ii) Restricted Stock and Restricted Stock Unit Awards.
Subject to adjustment as provided in Section 4.2, no Employee shall be
granted within any fiscal year of the Company one or more Restricted
Stock Awards or Restricted Stock Unit Awards, subject to Vesting
Conditions based on the attainment of Performance Goals, for more than
one million (1,000,000) shares of Stock reserved for issuance under the
Plan.
(iii) Performance Awards. Subject to adjustment as
provided in Section 4.2, no Employee shall be granted (1) Performance
Shares which could result in such Employee receiving more than one
million (1,000,000) shares of Stock reserved for issuance under the
Plan for each full fiscal year of the Company contained in the
Performance Period for such Award, or (2) Performance Units which could
result in such Employee receiving more than one million dollars
($1,000,000) for each full fiscal year of the Company contained in the
Performance Period for such Award. No Participant may be granted more
than one Performance Award for the same Performance Period.
6. Terms and Conditions of Options.
Options shall be evidenced by Award Agreements specifying the number of
shares of Stock covered thereby, in such form as the Committee shall
from time to time establish. No Option or purported Option shall be a
valid and binding obligation of the Company unless evidenced by a fully
executed Award Agreement. Award Agreements evidencing Options may
incorporate all or any of the terms of the Plan by reference and shall
comply with and be subject to the following terms and conditions:
6.1 Exercise Price. The exercise price for each Option shall be
established in the discretion of the Committee; provided, however, that
(a) the exercise price per share shall be not less than the Fair Market
Value of a share of Stock on the effective date of grant of the Option
and (b) no Incentive Stock Option granted to a Ten Percent Owner shall
have an exercise price per share less than one hundred ten percent
(110%) of the Fair Market Value of a share of Stock on the effective
date of grant of the Option. Notwithstanding the foregoing, an Option
(whether an Incentive Stock Option or a Nonstatutory Stock Option) may
be granted with an exercise price lower than the minimum exercise price
set forth above if such Option is granted pursuant to an assumption or
substitution for another option in a manner qualifying under the
provisions of Section 424(a) of the Code.
6.2 Exercisability and Term of Options.
(a) Option Vesting and Exercisability. Options shall be
exercisable at such time or times, or upon such event or events, and
subject to such terms, conditions, performance criteria and
restrictions as shall be determined by the Committee and set forth in
the Award Agreement evidencing such Option; provided, however, that (a)
no Option shall be exercisable after the expiration of ten (10) years
after the effective date of grant of such Option, (b) no Incentive
Stock Option granted to a Ten Percent Owner shall be exercisable after
the expiration of five (5) years after the effective date of grant of
such Option, and (c) no Option offered or granted to a prospective
Employee, prospective Consultant or prospective Director may become
exercisable prior to the date on which such person commences Service.
Subject to the foregoing, unless otherwise specified by the Committee
in the grant of an Option, any Option granted hereunder shall terminate
ten (10) years after the effective date of grant of the Option, unless
earlier terminated in accordance with its provisions, or the terms of
the Plan.
(b) Participant Responsibility for Exercise of Option. Each
Participant is responsible for taking any and all actions as may be
required to exercise any Option in a timely manner, and for properly
executing any documents as may be required for the exercise of an
Option in accordance with such rules and procedures as may be
established from time to time. By signing an Option Agreement each
Participant acknowledges that information regarding the procedures and
requirements for the exercise of any Option is available upon such
Participant?s request. The Company shall have no duty or obligation to
notify any Participant of the expiration date of any Option.
6.3 Payment of Exercise Price.
(a) Forms of Consideration Authorized. Except as otherwise
provided below, payment of the exercise price for the number of shares
of Stock being purchased pursuant to any Option shall be made (i) in
cash, by check or in cash equivalent, (ii) by tender to the Company, or
attestation to the ownership, of shares of Stock owned by the
Participant having a Fair Market Value not less than the exercise
price, (iii) provided that the Participant is an Employee, and not an
Officer or Director (unless otherwise not prohibited by law, including,
without limitation, any regulation promulgated by the Board of
Governors of the Federal Reserve System) and in the Company?s sole and
absolute discretion at the time the Option is exercised, by delivery of
the Participant?s promissory note in a form approved by the Company for
the aggregate exercise price, provided that, if the Company is
incorporated in the State of Delaware, the Participant shall pay in
cash that portion of the aggregate exercise price not less than the par
value of the shares being acquired, (iv) by such other consideration as
may be approved by the Committee from time to time to the extent
permitted by applicable law, or (v) by any combination thereof. The
Committee may at any time or from time to time grant Options which do
not permit all of the foregoing forms of consideration to be used in
payment of the exercise price or which otherwise restrict one or more
forms of consideration.
(b) Limitations on Forms of Consideration.
(i) Tender of Stock. Notwithstanding the foregoing, an
Option may not be exercised by tender to the Company, or attestation to
the ownership, of shares of Stock to the extent such tender or
attestation would constitute a violation of the provisions of any law,
regulation or agreement restricting the redemption of the Company?s
stock.
(ii) Payment by Promissory Note. No promissory note shall
be permitted if the exercise of an Option using a promissory note would
be a violation of any law. Any permitted promissory note shall be on
such terms as the Committee shall determine. The Committee shall have
the authority to permit or require the Participant to secure any
promissory note used to exercise an Option with the shares of Stock
acquired upon the exercise of the Option or with other collateral
acceptable to the Company. Unless otherwise provided by the Committee,
if the Company at any time is subject to the regulations promulgated by
the Board of Governors of the Federal Reserve System or any other
governmental entity affecting the extension of credit in connection
with the Company?s securities, any promissory note shall comply with
such applicable regulations, and the Participant shall pay the unpaid
principal and accrued interest, if any, to the extent necessary to
comply with such applicable regulations.
6.4 Effect of Termination of Service.
(a) Option Exercisability. Subject to earlier termination of
the Option as otherwise provided herein and unless otherwise provided
by the Committee, an Option shall be exercisable after a Participant?s
termination of Service only during the applicable time periods provided
in the Award Agreement.
(b) Extension if Exercise Prevented by Law. Notwithstanding the
foregoing, unless the Committee provides otherwise in the Award
Agreement, if the exercise of an Option within the applicable time
periods is prevented by the provisions of Section 14 below, the Option
shall remain exercisable until three (3) months (or such longer period
of time as determined by the Committee, in its discretion) after the
date the Participant is notified by the Company that the Option is
exercisable, but in any event no later than the Option Expiration Date.
(c) Extension if Participant Subject to Section 16(b).
Notwithstanding the foregoing, if a sale within the applicable time
periods of shares acquired upon the exercise of the Option would
subject the Participant to suit under Section 16(b) of the Exchange
Act, the Option shall remain exercisable until the earliest to occur of
(i) the tenth (10th) day following the date on which a sale of such
shares by the Participant would no longer be subject to such suit,
(ii) the one hundred and ninetieth (190th) day after the Participant?s
termination of Service, or (iii) the Option Expiration Date.
6.5 Transferability of Options. During the lifetime of the
Participant, an Option shall be exercisable only by the Participant or
the Participant?s guardian or legal representative. Prior to the
issuance of shares of Stock upon the exercise of an Option, the Option
shall not be subject in any manner to anticipation, alienation, sale,
exchange, transfer, assignment, pledge, encumbrance, or garnishment by
creditors of the Participant or the Participant?s beneficiary, except
transfer by will or by the laws of descent and distribution.
Notwithstanding the foregoing, to the extent permitted by the
Committee, in its discretion, and set forth in the Award Agreement
evidencing such Option, a Nonstatutory Stock Option shall be assignable
or transferable subject to the applicable limitations, if any,
described in the General Instructions to Form S-8 Registration
Statement under the Securities Act.
7. Terms and Conditions of Stock Appreciation Rights.
Stock Appreciation Rights shall be evidenced by Award Agreements
specifying the number of shares of Stock subject to the Award, in such
form as the Committee shall from time to time establish. No SAR or
purported SAR shall be a valid and binding obligation of the Company
unless evidenced by a fully executed Award Agreement. Award Agreements
evidencing SARs may incorporate all or any of the terms of the Plan by
reference and shall comply with and be subject to the following terms
and conditions:
7.1 Types of SARs Authorized. SARs may be granted in tandem with
all or any portion of a related Option (a ?Tandem SAR?) or may be
granted independently of any Option (a ?Freestanding SAR?). A Tandem
SAR may be granted either concurrently with the grant of the related
Option or at any time thereafter prior to the complete exercise,
termination, expiration or cancellation of such related Option.
7.2 Exercise Price. The exercise price for each SAR shall be
established in the discretion of the Committee; provided, however, that
(a) the exercise price per share subject to a Tandem SAR shall be the
exercise price per share under the related Option and (b) the exercise
price per share subject to a Freestanding SAR shall be not less than
the Fair Market Value of a share of Stock on the effective date of
grant of the SAR.
7.3 Exercisability and Term of SARs.
(a) Tandem SARs. Tandem SARs shall be exercisable only at the
time and to the extent, and only to the extent, that the related Option
is exercisable, subject to such provisions as the Committee may specify
where the Tandem SAR is granted with respect to less than the full
number of shares of Stock subject to the related Option.
(b) Freestanding SARs. Freestanding SARs shall be exercisable
at such time or times, or upon such event or events, and subject to
such terms, conditions, performance criteria and restrictions as shall
be determined by the Committee and set forth in the Award Agreement
evidencing such SAR; provided, however, that no Freestanding SAR shall
be exercisable after the expiration of ten (10) years after the
effective date of grant of such SAR.
7.4 Deemed Exercise of SARs. If, on the date on which an SAR would
otherwise terminate or expire, the SAR by its terms remains exercisable
immediately prior to such termination or expiration and, if so
exercised, would result in a payment to the holder of such SAR, then
any portion of such SAR which has not previously been exercised shall
automatically be deemed to be exercised as of such date with respect to
such portion.
7.5 Effect of Termination of Service. Subject to earlier
termination of the SAR as otherwise provided herein and unless
otherwise provided by the Committee in the grant of an SAR and set
forth in the Award Agreement, an SAR shall be exercisable after a
Participant?s termination of Service only as provided in the Award
Agreement.
7.6 Nontransferability of SARs. During the lifetime of the
Participant, an SAR shall be exercisable only by the Participant or the
Participant?s guardian or legal representative. Prior to the exercise
of an SAR, the SAR shall not be subject in any manner to anticipation,
alienation, sale, exchange, transfer, assignment, pledge, encumbrance,
or garnishment by creditors of the Participant or the Participant?s
beneficiary, except transfer by will or by the laws of descent and
distribution.
8. Terms and Conditions of Restricted Stock Awards.
Restricted Stock Awards shall be evidenced by Award Agreements
specifying the number of shares of Stock subject to the Award, in such
form as the Committee shall from time to time establish. No Restricted
Stock Award or purported Restricted Stock Award shall be a valid and
binding obligation of the Company unless evidenced by a fully executed
Award Agreement. Award Agreements evidencing Restricted Stock Awards
may incorporate all or any of the terms of the Plan by reference and
shall comply with and be subject to the following terms and conditions:
8.1 Types of Restricted Stock Awards Authorized. Restricted Stock
Awards may or may not require the payment of cash compensation for the
stock. Restricted Stock Awards may be granted upon such conditions as
the Committee shall determine, including, without limitation, upon the
attainment of one or more Performance Goals described in Section 9.4.
If either the grant of a Restricted Stock Award or the lapsing of the
Restriction Period is to be contingent upon the attainment of one or
more Performance Goals, the Committee shall follow procedures
substantially equivalent to those set forth in Sections 9.3 through
9.5(a).
8.2 Purchase Price. The purchase price, if any, for shares of Stock
issuable under each Restricted Stock Award and the means of payment
shall be established by the Committee in its discretion.
8.3 Purchase Period. A Restricted Stock Award requiring the payment
of cash consideration shall be exercisable within a period established
by the Committee; provided, however, that no Restricted Stock Award
granted to a prospective Employee, prospective Consultant or
prospective Director may become exercisable prior to the date on which
such person commences Service.
8.4 Vesting and Restrictions on Transfer. Shares issued pursuant to
any Restricted Stock Award may or may not be made subject to Vesting
Conditions based upon the satisfaction of such Service requirements,
conditions, restrictions or performance criteria, including, without
limitation, Performance Goals as described in Section 9.4, as shall be
established by the Committee and set forth in the Award Agreement
evidencing such Award. During any Restriction Period in which shares
acquired pursuant to a Restricted Stock Award remain subject to Vesting
Conditions, such shares may not be sold, exchanged, transferred,
pledged, assigned or otherwise disposed of other than as provided in
the Award Agreement or as provided in Section 8.7. Upon request by the
Company, each Participant shall execute any agreement evidencing such
transfer restrictions prior to the receipt of shares of Stock
hereunder.
8.5 Voting Rights; Dividends and Distributions. Except as provided
in this Section, Section 8.4 and any Award Agreement, during the
Restriction Period applicable to shares subject to a Restricted Stock
Award, the Participant shall have all of the rights of a stockholder of
the Company holding shares of Stock, including the right to vote such
shares and to receive all dividends and other distributions paid with
respect to such shares. However, in the event of a dividend or
distribution paid in shares of Stock or any other adjustment made upon
a change in the capital structure of the Company as described in
Section 4.2, any and all new, substituted or additional securities or
other property (other than normal cash dividends) to which the
Participant is entitled by reason of the Participant?s Restricted Stock
Award shall be immediately subject to the same Vesting Conditions as
the shares subject to the Restricted Stock Award with respect to which
such dividends or distributions were paid or adjustments were made.
8.6 Effect of Termination of Service. Unless otherwise provided by
the Committee in the grant of a Restricted Stock Award and set forth in
the Award Agreement, if a Participant?s Service terminates for any
reason, whether voluntary or involuntary (including the Participant?s
death or disability), then the Participant shall forfeit to the Company
any shares acquired by the Participant pursuant to a Restricted Stock
Award which remain subject to Vesting Conditions as of the date of the
Participant?s termination of Service in exchange for the payment of the
purchase price, if any, paid by the Participant. The Company shall have
the right to assign at any time any repurchase right it may have,
whether or not such right is then exercisable, to one or more persons
as may be selected by the Company.
8.7 Nontransferability of Restricted Stock Award Rights. Prior to
the issuance of shares of Stock pursuant to a Restricted Stock Award,
rights to acquire such shares shall not be subject in any manner to
anticipation, alienation, sale, exchange, transfer, assignment, pledge,
encumbrance or garnishment by creditors of the Participant or the
Participant?s beneficiary, except transfer by will or the laws of
descent and distribution. All rights with respect to a Restricted Stock
Award granted to a Participant hereunder shall be exercisable during
his or her lifetime only by such Participant or the Participant?s
guardian or legal representative.
9. Terms and Conditions of Performance Awards.
Performance Awards shall be evidenced by Award Agreements in such form
as the Committee shall from time to time establish. No Performance
Award or purported Performance Award shall be a valid and binding
obligation of the Company unless evidenced by a fully executed Award
Agreement. Award Agreements evidencing Performance Awards may
incorporate all or any of the terms of the Plan by reference and shall
comply with and be subject to the following terms and conditions:
9.1 Types of Performance Awards Authorized. Performance Awards may
be in the form of either Performance Shares or Performance Units. Each
Award Agreement evidencing a Performance Award shall specify the number
of Performance Shares or Performance Units subject thereto, the
Performance Award Formula, the Performance Goal(s) and Performance
Period applicable to the Award, and the other terms, conditions and
restrictions of the Award.
9.2 Initial Value of Performance Shares and Performance Units.
Unless otherwise provided by the Committee in granting a Performance
Award, each Performance Share shall have an initial value equal to the
Fair Market Value of one (1) share of Stock, subject to adjustment as
provided in Section 4.2, on the effective date of grant of the
Performance Share. Each Performance Unit shall have an initial value
determined by the Committee. The final value payable to the Participant
in settlement of a Performance Award determined on the basis of the
applicable Performance Award Formula will depend on the extent to which
Performance Goals established by the Committee are attained within the
applicable Performance Period established by the Committee.
9.3 Establishment of Performance Period, Performance Goals and
Performance Award Formula. In granting each Performance Award, the
Committee shall establish in writing the applicable Performance Period,
Performance Award Formula and one or more Performance Goals which, when
measured at the end of the Performance Period, shall determine on the
basis of the Performance Award Formula the final value of the
Performance Award to be paid to the Participant. To the extent
compliance with the requirements under Section 162(m) with respect to
?performance-based compensation? is desired, the Committee shall
establish the Performance Goal(s) and Performance Award Formula
applicable to each Performance Award no later than the earlier of (a)
the date ninety (90) days after the commencement of the applicable
Performance Period or (b) the date on which 25% of the Performance
Period has elapsed, and, in any event, at a time when the outcome of
the Performance Goals remains substantially uncertain. Once
established, the Performance Goals and Performance Award Formula shall
not be changed during the Performance Period. The Company shall notify
each Participant granted a Performance Award of the terms of such
Award, including the Performance Period, Performance Goal(s) and
Performance Award Formula.
9.4 Measurement of Performance Goals. Performance Goals shall be
established by the Committee on the basis of targets to be attained
(?Performance Targets?) with respect to one or more measures of
business or financial performance (each, a ?Performance Measure?),
subject to the following:
(a) Performance Measures. Performance Measures shall have the
same meanings as used in the Company?s financial statements, or, if
such terms are not used in the Company?s financial statements, they
shall have the meaning applied pursuant to generally accepted
accounting principles, or as used generally in the Company?s industry.
Performance Measures shall be calculated with respect to the Company
and each Subsidiary Corporation consolidated therewith for financial
reporting purposes or such division or other business unit as may be
selected by the Committee. For purposes of the Plan, the Performance
Measures applicable to a Performance Award shall be calculated in
accordance with generally accepted accounting principles, but prior to
the accrual or payment of any Performance Award for the same
Performance Period and excluding the effect (whether positive or
negative) of any change in accounting standards or any extraordinary,
unusual or nonrecurring item, as determined by the Committee, occurring
after the establishment of the Performance Goals applicable to the
Performance Award. Each such adjustment, if any, shall be made solely
for the purpose of providing a consistent basis from period to period
for the calculation of Performance Measures in order to prevent the
dilution or enlargement of the Participant?s rights with respect to a
Performance Award. Performance Measures may be one or more of the
following, as determined by the Committee: (i) sales revenue; (ii)
gross margin; (iii) operating margin; (iv) operating income; (v) pre-
tax profit; (vi) earnings before stock-based compensation expense,
interest, taxes and depreciation and amortization; (vii) earnings
before interest, taxes and depreciation and amortization; (viii)
earnings before interest and taxes; (ix) net income; (x) expenses; (xi)
the market price of the Stock; (xii) stock price; (xiii) earnings per
share; (xiv) return on stockholder equity; (xv) return on capital;
(xvi) return on net assets; (xvii) economic value added; (xviii) market
share; (xix) customer service; (xx) customer satisfaction; (xxi)
safety; (xxii) total stockholder return; (xxiii) free cash flow; (xxiv)
net operating income; (xxv) operating cash flow; (xxvi) return on
investment; (xxvii) employee satisfaction; (xxviii) employee retention;
(xxix) balance of cash, cash equivalents and marketable securities;
(xxx) product development; (xxxi) research and development expenses;
(xxxii) completion of an identified special project; (xxxiii)
completion of a joint venture or other corporate transaction; or
(xxxiv) such other measures as determined by the Committee consistent
with this Section 9.4(a).
(b) Performance Targets. Performance Targets may include a
minimum, maximum, target level and intermediate levels of performance,
with the final value of a Performance Award determined under the
applicable Performance Award Formula by the level attained during the
applicable Performance Period. A Performance Target may be stated as an
absolute value or as a value determined relative to a standard selected
by the Committee.
9.5 Settlement of Performance Awards.
(a) Determination of Final Value. As soon as practicable
following the completion of the Performance Period applicable to a
Performance Award, the Committee shall certify in writing the extent to
which the applicable Performance Goals have been attained and the
resulting final value of the Award earned by the Participant and to be
paid upon its settlement in accordance with the applicable Performance
Award Formula.
(b) Discretionary Adjustment of Award Formula. In its
discretion, the Committee may, either at the time it grants a
Performance Award or at any time thereafter, provide for the positive
or negative adjustment of the Performance Award Formula applicable to a
Performance Award that is not intended to constitute ?qualified
performance based compensation? to a ?covered employee? within the
meaning of Section 162(m) (a ?Covered Employee?) to reflect such
Participant?s individual performance in his or her position with the
Company or such other factors as the Committee may determine. With
respect to a Performance Award intended to constitute qualified
performance-based compensation to a Covered Employee, the Committee
shall have the discretion to reduce some or all of the value of the
Performance Award that would otherwise be paid to the Covered Employee
upon its settlement notwithstanding the attainment of any Performance
Goal and the resulting value of the Performance Award determined in
accordance with the Performance Award Formula.
(c) Payment in Settlement of Performance Awards. As soon as
practicable following the Committee?s determination and certification
in accordance with Sections 9.5(a) and (b), payment shall be made to
each eligible Participant (or such Participant?s legal representative
or other person who acquired the right to receive such payment by
reason of the Participant?s death) of the final value of the
Participant?s Performance Award. Payment of such amount shall be made
in cash in a lump sum or in installments, shares of Stock (either fully
vested or subject to vesting), or a combination thereof, as determined
by the Committee.
9.6 Voting Rights; Dividend Equivalent Rights and Distributions.
Participants shall have no voting rights with respect to shares of
Stock represented by Performance Share Awards until the date of the
issuance of such shares, if any (as evidenced by the appropriate entry
on the books of the Company or of a duly authorized transfer agent of
the Company). However, the Committee, in its discretion, may provide in
the Award Agreement evidencing any Performance Share Award that the
Participant shall be entitled to receive Dividend Equivalents with
respect to the payment of cash dividends on Stock having a record date
prior to the date on which the Performance Shares are settled or
forfeited. Such Dividend Equivalents, if any, shall be credited to the
Participant in the form of additional whole Performance Shares as of
the date of payment of such cash dividends on Stock. The number of
additional Performance Shares (rounded to the nearest whole number) to
be so credited shall be determined by dividing (a) the amount of cash
dividends paid on such date with respect to the number of shares of
Stock represented by the Performance Shares previously credited to the
Participant by (b) the Fair Market Value per share of Stock on such
date. Dividend Equivalents may be paid currently or may be accumulated
and paid to the extent that Performance Shares become nonforfeitable,
as determined by the Committee. Settlement of Dividend Equivalents may
be made in cash, shares of Stock, or a combination thereof as
determined by the Committee, and may be paid on the same basis as
settlement of the related Performance Share as provided in Section 9.5.
Dividend Equivalents shall not be paid with respect to Performance
Units. In the event of a dividend or distribution paid in shares of
Stock or any other adjustment made upon a change in the capital
structure of the Company as described in Section 4.2, appropriate
adjustments shall be made in the Participant?s Performance Share Award
so that it represents the right to receive upon settlement any and all
new, substituted or additional securities or other property (other than
normal cash dividends) to which the Participant would entitled by
reason of the shares of Stock issuable upon settlement of the
Performance Share Award, and all such new, substituted or additional
securities or other property shall be immediately subject to the same
Performance Goals as are applicable to the Award.
9.7 Effect of Termination of Service. Unless otherwise provided by
the Committee in the grant of a Performance Award and set forth in the
Award Agreement, the effect of a Participant?s termination of Service
on the Performance Award shall be as follows:
(a) Death or Disability. If the Participant?s Service
terminates because of the death or Disability of the Participant before
the completion of the Performance Period applicable to the Performance
Award, the final value of the Participant?s Performance Award shall be
determined by the extent to which the applicable Performance Goals have
been attained with respect to the entire Performance Period and shall
be prorated based on the number of months of the Participant?s Service
during the Performance Period. Payment shall be made following the end
of the Performance Period in any manner permitted by Section 9.5.
(b) Other Termination of Service. If the Participant?s Service
terminates for any reason except death or Disability before the
completion of the Performance Period applicable to the Performance
Award, such Award shall be forfeited in its entirety; provided,
however, that in the event of an involuntary termination of the
Participant?s Service, the Committee, in its sole discretion, may waive
the automatic forfeiture of all or any portion of any such Award.
9.8 Nontransferability of Performance Awards. Prior to settlement
in accordance with the provisions of the Plan, no Performance Award
shall be subject in any manner to anticipation, alienation, sale,
exchange, transfer, assignment, pledge, encumbrance, or garnishment by
creditors of the Participant or the Participant?s beneficiary, except
transfer by will or by the laws of descent and distribution. All rights
with respect to a Performance Award granted to a Participant hereunder
shall be exercisable during his or her lifetime only by such
Participant or the Participant?s guardian or legal representative.
10. Terms and Conditions of Restricted Stock Unit Awards.
Restricted Stock Unit Awards shall be evidenced by Award Agreements
specifying the number of Restricted Stock Units subject to the Award,
in such form as the Committee shall from time to time establish. No
Restricted Stock Unit Award or purported Restricted Stock Unit Award
shall be a valid and binding obligation of the Company unless evidenced
by a fully executed Award Agreement. Award Agreements evidencing
Restricted Stock Units may incorporate all or any of the terms of the
Plan by reference and shall comply with and be subject to the following
terms and conditions:
10.1 Grant of Restricted Stock Unit Awards. Restricted Stock Unit
Awards may be granted upon such conditions as the Committee shall
determine, including, without limitation, upon the attainment of one or
more Performance Goals described in Section 9.4. If either the grant of
a Restricted Stock Unit Award or the Vesting Conditions with respect to
such Award is to be contingent upon the attainment of one or more
Performance Goals, the Committee shall follow procedures substantially
equivalent to those set forth in Sections 9.3 through 9.5(a).
10.2 Vesting. Restricted Stock Units may or may not be made
subject to Vesting Conditions based upon the satisfaction of such
Service requirements, conditions, restrictions or performance criteria,
including, without limitation, Performance Goals as described in
Section 9.4, as shall be established by the Committee and set forth in
the Award Agreement evidencing such Award.
10.3 Voting Rights, Dividend Equivalent Rights and Distributions.
Participants shall have no voting rights with respect to shares of
Stock represented by Restricted Stock Units until the date of the
issuance of such shares (as evidenced by the appropriate entry on the
books of the Company or of a duly authorized transfer agent of the
Company). However, the Committee, in its discretion, may provide in the
Award Agreement evidencing any Restricted Stock Unit Award that the
Participant shall be entitled to receive Dividend Equivalents with
respect to the payment of cash dividends on Stock having a record date
prior to the date on which Restricted Stock Units held by such
Participant are settled. Such Dividend Equivalents, if any, shall be
paid by crediting the Participant with additional whole Restricted
Stock Units as of the date of payment of such cash dividends on Stock.
The number of additional Restricted Stock Units (rounded to the nearest
whole number) to be so credited shall be determined by dividing (a) the
amount of cash dividends paid on such date with respect to the number
of shares of Stock represented by the Restricted Stock Units previously
credited to the Participant by (b) the Fair Market Value per share of
Stock on such date. Such additional Restricted Stock Units shall be
subject to the same terms and conditions and shall be settled in the
same manner and at the same time (or as soon thereafter as practicable)
as the Restricted Stock Units originally subject to the Restricted
Stock Unit Award. In the event of a dividend or distribution paid in
shares of Stock or any other adjustment made upon a change in the
capital structure of the Company as described in Section 4.2,
appropriate adjustments shall be made in the Participant?s Restricted
Stock Unit Award so that it represents the right to receive upon
settlement any and all new, substituted or additional securities or
other property (other than normal cash dividends) to which the
Participant would entitled by reason of the shares of Stock issuable
upon settlement of the Award, and all such new, substituted or
additional securities or other property shall be immediately subject to
the same Vesting Conditions as are applicable to the Award.
10.4 Effect of Termination of Service. Unless otherwise provided by
the Committee in the grant of a Restricted Stock Unit Award and set
forth in the Award Agreement, if a Participant?s Service terminates for
any reason, whether voluntary or involuntary (including the
Participant?s death or disability), then the Participant shall forfeit
to the Company any Restricted Stock Units pursuant to the Award which
remain subject to Vesting Conditions as of the date of the
Participant?s termination of Service.
10.5 Settlement of Restricted Stock Unit Awards. The Company shall
issue to a Participant on the date on which Restricted Stock Units
subject to the Participant?s Restricted Stock Unit Award vest or on
such other date determined by the Committee, in its discretion, and set
forth in the Award Agreement one (1) share of Stock (and/or any other
new, substituted or additional securities or other property pursuant to
an adjustment described in Section 10.3) for each Restricted Stock Unit
then becoming vested or otherwise to be settled on such date, subject
to the withholding of applicable taxes. Notwithstanding the foregoing,
if permitted by the Committee and set forth in the Award Agreement, the
Participant may elect in accordance with terms specified in the Award
Agreement to defer receipt of all or any portion of the shares of Stock
or other property otherwise issuable to the Participant pursuant to
this Section.
10.6 Nontransferability of Restricted Stock Unit Awards. Prior to
the issuance of shares of Stock in settlement of a Restricted Stock
Unit Award, the Award shall not be subject in any manner to
anticipation, alienation, sale, exchange, transfer, assignment, pledge,
encumbrance, or garnishment by creditors of the Participant or the
Participant?s beneficiary, except transfer by will or by the laws of
descent and distribution. All rights with respect to a Restricted Stock
Unit Award granted to a Participant hereunder shall be exercisable
during his or her lifetime only by such Participant or the
Participant?s guardian or legal representative.
11.Deferred Compensation Awards.
11.1 Establishment of Deferred Compensation Award Programs. This
Section 11 shall not be effective unless and until the Committee
determines to establish a program pursuant to this Section. The
Committee, in its discretion and upon such terms and conditions as it
may determine, may establish one or more programs pursuant to the Plan
under which:
(a) Participants designated by the Committee who are Insiders
or otherwise among a select group of highly compensated Employees may
irrevocably elect, prior to a date specified by the Committee, to
reduce such Participant?s compensation otherwise payable in cash
(subject to any minimum or maximum reductions imposed by the Committee)
and to be granted automatically at such time or times as specified by
the Committee one or more Awards of Stock Units with respect to such
numbers of shares of Stock as determined in accordance with the rules
of the program established by the Committee and having such other terms
and conditions as established by the Committee.
(b) Participants designated by the Committee who are Insiders
or otherwise among a select group of highly compensated Employees may
irrevocably elect, prior to a date specified by the Committee, to be
granted automatically an Award of Stock Units with respect to such
number of shares of Stock and upon such other terms and conditions as
established by the Committee in lieu of:
(i) shares of Stock otherwise issuable to such Participant
upon the exercise of an Option;
(ii) cash or shares of Stock otherwise issuable to such
Participant upon the exercise of an SAR; or
(iii) cash or shares of Stock otherwise issuable to such
Participant upon the settlement of a Performance Award or Performance
Unit.
11.2 Terms and Conditions of Deferred Compensation Awards. Deferred
Compensation Awards granted pursuant to this Section 11 shall be
evidenced by Award Agreements in such form as the Committee shall from
time to time establish. No such Deferred Compensation Award or
purported Deferred Compensation Award shall be a valid and binding
obligation of the Company unless evidenced by a fully executed Award
Agreement. Award Agreements evidencing Deferred Compensation Awards may
incorporate all or any of the terms of the Plan by reference and shall
comply with and be subject to the following terms and conditions:
(a) Vesting Conditions. Deferred Compensation Awards shall not
be subject to any vesting conditions.
(b)Terms and Conditions of Stock Units.
(i) Voting Rights; Dividend Equivalent Rights and
Distributions. Participants shall have no voting rights with respect to
shares of Stock represented by Stock Units until the date of the
issuance of such shares (as evidenced by the appropriate entry on the
books of the Company or of a duly authorized transfer agent of the
Company). However, a Participant shall be entitled to receive Dividend
Equivalents with respect to the payment of cash dividends on Stock
having a record date prior to date on which Stock Units held by such
Participant are settled. Such Dividend Equivalents shall be paid by
crediting the Participant with additional whole and/or fractional Stock
Units as of the date of payment of such cash dividends on Stock. The
method of determining the number of additional Stock Units to be so
credited shall be specified by the Committee and set forth in the Award
Agreement. Such additional Stock Units shall be subject to the same
terms and conditions and shall be settled in the same manner and at the
same time (or as soon thereafter as practicable) as the Stock Units
originally subject to the Stock Unit Award. In the event of a dividend
or distribution paid in shares of Stock or any other adjustment made
upon a change in the capital structure of the Company as described in
Section 4.2, appropriate adjustments shall be made in the Participant?s
Stock Unit Award so that it represent the right to receive upon
settlement any and all new, substituted or additional securities or
other property (other than normal cash dividends) to which the
Participant would be entitled by reason of the shares of Stock issuable
upon settlement of the Award.
(ii) Settlement of Stock Unit Awards. A Participant
electing to receive an Award of Stock Units pursuant to this Section 11
shall specify at the time of such election a settlement date with
respect to such Award. The Company shall issue to the Participant as
soon as practicable following the earlier of the settlement date
elected by the Participant or the date of termination of the
Participant?s Service, a number of whole shares of Stock equal to the
number of whole Stock Units subject to the Stock Unit Award. Such
shares of Stock shall be fully vested, and the Participant shall not be
required to pay any additional consideration (other than applicable tax
withholding) to acquire such shares. Any fractional Stock Unit subject
to the Stock Unit Award shall be settled by the Company by payment in
cash of an amount equal to the Fair Market Value as of the payment date
of such fractional share.
(iii) Nontransferability of Stock Unit Awards. Prior to
their settlement in accordance with the provision of the Plan, no Stock
Unit Award shall be subject in any manner to anticipation, alienation,
sale, exchange, transfer, assignment, pledge, encumbrance, or
garnishment by creditors of the Participant or the Participant?s
beneficiary, except transfer by will or by the laws of descent and
distribution. All rights with respect to a Stock Unit Award granted to
a Participant hereunder shall be exercisable during his or her lifetime
only by such Participant or the Participant?s guardian or legal
representative.
12. Other Stock-Based Awards.
In addition to the Awards set forth in Sections 6 through 11 above, the
Committee, in its sole discretion, may carry out the purpose of this
Plan by awarding Stock-Based Awards as it determines to be in the best
interests of the Company and subject to such other terms and conditions
as it deems necessary and appropriate.
13. Effect of Change in Control on Options and SARs.
13.1 Accelerated Vesting. The Committee, in its sole discretion,
may provide in any Award Agreement or, in the event of a Change in
Control, may take such actions as it deems appropriate to provide for
the acceleration of the exercisability and vesting in connection with
such Change in Control of any or all outstanding Options and SARs and
shares acquired upon the exercise of such Options and SARs upon such
conditions and to such extent as the Committee shall determine.
13.2 Assumption or Substitution. In the event of a Change in
Control, the surviving, continuing, successor, or purchasing
corporation or other business entity or parent thereof, as the case may
be (the ?Acquiring Corporation?), may, without the consent of the
Participant, either assume the Company?s rights and obligations under
outstanding Options and SARs or substitute for outstanding Options and
SARs substantially equivalent options or stock appreciation rights for
the Acquiring Corporation?s stock. Any Options or SARs which are
neither assumed or substituted for by the Acquiring Corporation in
connection with the Change in Control nor exercised as of the date of
the Change in Control shall terminate and cease to be outstanding
effective as of the date of the Change in Control. Notwithstanding the
foregoing, shares acquired upon exercise of an Option or SAR prior to
the Change in Control and any consideration received pursuant to the
Change in Control with respect to such shares shall continue to be
subject to all applicable provisions of the Award Agreement evidencing
such Award except as otherwise provided in such Award Agreement.
Furthermore, notwithstanding the foregoing, if the corporation the
stock of which is subject to the outstanding Options or SARs
immediately prior to an Ownership Change Event described in Section
2.1(y)(i) constituting a Change in Control is the surviving or
continuing corporation and immediately after such Ownership Change
Event less than fifty percent (50%) of the total combined voting power
of its voting stock is held by another corporation or by other
corporations that are members of an affiliated group within the meaning
of Section 1504(a) of the Code without regard to the provisions of
Section 1504(b) of the Code, the outstanding Options and SARs shall not
terminate unless the Board otherwise provides in its discretion.
13.3 Effect of Change in Control on Restricted Stock and Other Type
of Awards. The Committee may, in its discretion, provide in any Award
Agreement evidencing a Restricted Stock or Other Type of Award that, in
the event of a Change in Control, the lapsing of any applicable Vesting
Condition, Restriction Period or Performance Goal applicable to the
shares subject to such Award held by a Participant whose Service has
not terminated prior to the Change in Control shall be accelerated
and/or waived effective immediately prior to the consummation of the
Change in Control to such extent as specified in such Award Agreement.
Any acceleration, waiver or the lapsing of any restriction that was
permissible solely by reason of this Section 13.3 and the provisions of
such Award Agreement shall be conditioned upon the consummation of the
Change in Control.
14. Compliance with Securities Law.
The grant of Awards and the issuance of shares of Stock pursuant to any
Award shall be subject to compliance with all applicable requirements
of federal, state and foreign law with respect to such securities and
the requirements of any stock exchange or market system upon which the
Stock may then be listed. In addition, no Award may be exercised or
shares issued pursuant to an Award unless (a) a registration statement
under the Securities Act shall at the time of such exercise or issuance
be in effect with respect to the shares issuable pursuant to the Award
or (b) in the opinion of legal counsel to the Company, the shares
issuable pursuant to the Award may be issued in accordance with the
terms of an applicable exemption from the registration requirements of
the Securities Act. The inability of the Company to obtain from any
regulatory body having jurisdiction the authority, if any, deemed by
the Company?s legal counsel to be necessary to the lawful issuance and
sale of any shares hereunder shall relieve the Company of any liability
in respect of the failure to issue or sell such shares as to which such
requisite authority shall not have been obtained. As a condition to
issuance of any Stock, the Company may require the Participant to
satisfy any qualifications that may be necessary or appropriate, to
evidence compliance with any applicable law or regulation and to make
any representation or warranty with respect thereto as may be requested
by the Company.
15. Tax Withholding.
15.1 Tax Withholding in General. The Company shall have the right
to deduct from any and all payments made under the Plan, or to require
the Participant, through payroll withholding, cash payment or
otherwise, including by means of a Cashless Exercise or Net Exercise of
an Option, to make adequate provision for, the federal, state, local
and foreign taxes, if any, required by law to be withheld by the
Participating Company Group with respect to an Award or the shares
acquired pursuant thereto. The Company shall have no obligation to
deliver shares of Stock, to release shares of Stock from an escrow
established pursuant to an Award Agreement, or to make any payment in
cash under the Plan until the Participating Company Group?s tax
withholding obligations have been satisfied by the Participant.
15.2 Withholding in Shares. The Company shall have the right, but
not the obligation, to deduct from the shares of Stock issuable to a
Participant upon the exercise or settlement of an Award, or to accept
from the Participant the tender of, a number of whole shares of Stock
having a Fair Market Value, as determined by the Company, equal to all
or any part of the tax withholding obligations of the Participating
Company Group. The Fair Market Value of any shares of Stock withheld or
tendered to satisfy any such tax withholding obligations shall not
exceed the amount determined by the applicable minimum statutory
withholding rates.
16. Amendment or Termination of Plan.
The Board or the Committee may amend, suspend or terminate the Plan at
any time. However, without the approval of the Company?s stockholders,
there shall be (a) no increase in the maximum aggregate number of
shares of Stock that may be issued under the Plan (except by operation
of the provisions of Section 4.2), (b) no change in the class of
persons eligible to receive Incentive Stock Options, and (c) no other
amendment of the Plan that would require approval of the Company?s
stockholders under any applicable law, regulation or rule. No
amendment, suspension or termination of the Plan shall affect any then
outstanding Award unless expressly provided by the Board or the
Committee. In any event, no amendment, suspension or termination of
the Plan may adversely affect any then outstanding Award without the
consent of the Participant unless necessary to comply with any
applicable law, regulation or rule.
17. Miscellaneous Provisions.
17.1 Repurchase Rights. Shares issued under the Plan may be subject
to one or more repurchase options, or other conditions and restrictions
as determined by the Committee in its discretion at the time the Award
is granted. The Company shall have the right to assign at any time any
repurchase right it may have, whether or not such right is then
exercisable, to one or more persons as may be selected by the Company.
Upon request by the Company, each Participant shall execute any
agreement evidencing such transfer restrictions prior to the receipt of
shares of Stock hereunder and shall promptly present to the Company any
and all certificates representing shares of Stock acquired hereunder
for the placement on such certificates of appropriate legends
evidencing any such transfer restrictions.
17.2 Provision of Information. Each Participant shall be given
access to information concerning the Company equivalent to that
information generally made available to the Company?s common
stockholders.
17.3 Rights as Employee, Consultant or Director. No person, even
though eligible pursuant to Section 5, shall have a right to be
selected as a Participant, or, having been so selected, to be selected
again as a Participant. Nothing in the Plan or any Award granted under
the Plan shall confer on any Participant a right to remain an Employee,
Consultant or Director or interfere with or limit in any way any right
of a Participating Company to terminate the Participant?s Service at
any time. To the extent that an Employee of a Participating Company
other than the Company receives an Award under the Plan, that Award
shall in no event be understood or interpreted to mean that the Company
is the Employee?s employer or that the Employee has an employment
relationship with the Company.
17.4 Rights as a Stockholder. A Participant shall have no rights as
a stockholder with respect to any shares covered by an Award until the
date of the issuance of such shares (as evidenced by the appropriate
entry on the books of the Company or of a duly authorized transfer
agent of the Company). No adjustment shall be made for dividends,
distributions or other rights for which the record date is prior to the
date such shares are issued, except as provided in Section 4.2 or
another provision of the Plan.
17.5 Fractional Shares. The Company shall not be required to issue
fractional shares upon the exercise or settlement of any Award.
17.6 Severability. If any one or more of the provisions (or any
part thereof) of this Plan shall be held invalid, illegal or
unenforceable in any respect, such provision shall be modified so as to
make it valid, legal and enforceable, and the validity, legality and
enforceability of the remaining provisions (or any part thereof) of the
Plan shall not in any way be affected or impaired thereby.
17.7 Beneficiary Designation. Subject to local laws and procedures,
each Participant may file with the Company a written designation of a
beneficiary who is to receive any benefit under the Plan to which the
Participant is entitled in the event of such Participant?s death before
he or she receives any or all of such benefit. Each designation will
revoke all prior designations by the same Participant, shall be in a
form prescribed by the Company, and will be effective only when filed
by the Participant in writing with the Company during the Participant?s
lifetime. If a married Participant designates a beneficiary other than
the Participant?s spouse, the effectiveness of such designation may be
subject to the consent of the Participant?s spouse. If a Participant
dies without an effective designation of a beneficiary who is living at
the time of the Participant?s death, the Company will pay any remaining
unpaid benefits to the Participant?s legal representative.
17.8 Unfunded Obligation. Participants shall have the status of
general unsecured creditors of the Company. Any amounts payable to
Participants pursuant to the Plan shall be unfunded and unsecured
obligations for all purposes, including, without limitation, Title I of
the Employee Retirement Income Security Act of 1974. No Participating
Company shall be required to segregate any monies from its general
funds, or to create any trusts, or establish any special accounts with
respect to such obligations. The Company shall retain at all times
beneficial ownership of any investments, including trust investments,
which the Company may make to fulfill its payment obligations
hereunder. Any investments or the creation or maintenance of any trust
or any Participant account shall not create or constitute a trust or
fiduciary relationship between the Committee or any Participating
Company and a Participant, or otherwise create any vested or beneficial
interest in any Participant or the Participant?s creditors in any
assets of any Participating Company. The Participants shall have no
claim against any Participating Company for any changes in the value of
any assets which may be invested or reinvested by the Company with
respect to the Plan. Each Participating Company shall be responsible
for making benefit payments pursuant to the Plan on behalf of its
Participants or for reimbursing the Company for the cost of such
payments, as determined by the Company in its sole discretion. In the
event the respective Participating Company fails to make such payment
or reimbursement, a Participant?s (or other individual?s) sole recourse
shall be against the respective Participating Company, and not against
the Company. A Participant?s acceptance of an Award pursuant to the
Plan shall constitute agreement with this provision.
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