NEXTEL PARTNERS, INC.
STOCK OPTION AGREEMENT
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STOCK OPTION AGREEMENT, dated as of January 29, 1999, between Nextel
Partners, Inc., a Delaware corporation (the "Company"), and Xxxx X. Xxxxxxxx
("Employee").
WHEREAS, Employee and the Company have entered into an Employment
Agreement of even date herewith (the "Employment Agreement"), pursuant to which
the Company has agreed to issue to Employee options to purchase 35,000 shares
of its Class A Common Stock at a purchase price of $10.00 per share.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, receipt of which is hereby
acknowledged, the parties hereto do hereby agree as follows:
ARTICLE I
GRANT OF OPTION
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1.1 Grant of Option. In consideration of Employee's execution and
delivery of the Employment Agreement, and his service to date on behalf of the
Company and its Subsidiaries, and for other good and valuable consideration,
the Company hereby irrevocably grants to Employee the option (the "Option") to
purchase up to 35,000 shares of its Class A Common Stock ("Shares") upon the
terms and conditions set forth in this Agreement.
1.2 Purchase Price. The purchase price of each Share covered by the
Option shall be $10.00, without commission or other charge, subject to
adjustment as provided in Section 1.4.
1.3 No Right to Continued Employment. Nothing in this Agreement shall
confer upon Employee any right to continue in the employ of the Company or any
Subsidiary, or shall interfere with or restrict in any way the rights of the
Company and its Subsidiaries, which are hereby expressly reserved, to discharge
Employee at any time for any reason whatsoever, with or without cause.
1.4 Adjustments in Option and Purchase Price. In the event that the
Board of Directors of the Company (the "Board") determines that any dividend or
other distribution (whether in the form of cash, Shares, other securities or
other property), recapitalization, stock split, reverse stock split,
reorganization, reclassification, merger, consolidation, split-up, spin-off,
combination, repurchase, or exchange of Shares or other securities of the
Company, issuance of warrants or other rights to purchase Shares or other
securities of the Company, or other similar corporate transaction or event
affects the Shares such that an adjustment is determined by the Board to be
appropriate in order to prevent dilution or enlargement of the benefits or
potential benefits intended to be made available under this Agreement, then the
Board shall, in such manner as it may deem equitable, adjust any or all of (i)
the number of Shares or other securities of the Company (or number and kind of
other securities or
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property) subject to the Option, and (ii) the grant or exercise price with
respect to the Option, or, if deemed appropriate, make provision for a cash
payment to Employee.
ARTICLE II
PERIOD OF EXERCISABILITY
2.1 Exercisability. The Option is fully and immediately vested as of
the date of this Agreement. Notwithstanding anything contained in this
Agreement to the contrary, at any time after the fourth anniversary of the date
of this Agreement, if the time period(s) specified by Section 2.2 have not
expired, Employee may surrender, without payment of the purchase price, all or
any portion of the Option for payment in cash of $14.286 per Share subject to
the Option surrendered (subject to adjustment in accordance with Section 1.4),
e.g. $500,000 if the entire Option is surrendered. Upon such surrender, the
Company shall pay such amount to Employee in cash no later than ten days after
such surrender, provided that notwithstanding anything contained in this
Agreement to the contrary, such surrender shall not be effective, and the
Option so surrendered shall remain in full force and effect, until payment in
full as aforesaid has been made to Employee in consideration thereof.
2.2 Expiration of Option. The Option may not be exercised to any
extent by anyone after the expiration of ten years from the date of this
Agreement.
ARTICLE III
EXERCISE OF OPTION
3.1 Person Eligible to Exercise. During the lifetime of Employee,
only he (or permitted successors and assigns pursuant to Section 4.1) may
exercise the Option or any portion thereof. After the death of Employee, any
exercisable portion of the Option may, prior to the time when the Option
becomes unexercisable under Section 2.2, be exercised by his personal
representative or by any person empowered to do so under Employee's will or
under the then applicable laws of descent and distribution.
3.2 Partial Exercise. The Option may be exercised in whole or in
part at any time prior to the time when the Option becomes unexercisable under
Section 2.2; provided, however, that each partial exercise shall be for not
less than 100 shares and shall be for whole shares only.
3.3 Manner of Exercise. The Option, or any exercisable
portion thereof, may be exercised solely by delivery to the Secretary of the
Company of all of the following items prior to the time when the Option or such
portion becomes unexercisable under Section 2.2:
(a) Notice in writing signed by Employee or the other person then entitled to
exercise the Option or portion, stating that the Option or portion is thereby
exercised; and
(b) (i) Full payment (in cash or by check) for the shares with respect to which
the Option or portion is thereby exercised; or
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(ii) Full payment by delivery to the Company of shares of the Company's Class A
Common Stock owned by Employee duly endorsed for transfer to the Company by
Employee or other person then entitled to exercise the Option or portion, with
an aggregate fair market value as determined in the reasonable discretion of
the Board ("Fair Market Value") equal to the Option price of the shares with
respect to which the Option or portion is thereby exercised; or
(iii) With the consent of the Board, a full recourse promissory note bearing
interest (at the lowest rate as shall then preclude the imputation of interest
under the Internal Revenue Code or successor provision) and payable upon such
terms as may be prescribed by the Board. The Board may also prescribe the form
of such note and the security to be given for such note. The Option may not be
exercised, however, by delivery of a promissory note or by a loan from the
Company when or where such loan or other extension of credit is prohibited by
law; or
(iv) Subject to the Board's consent, any combination of the considerations
provided for in the foregoing subsections (i), (ii) and (iii); and
(c) On or prior to the date the same is required to be withheld:
(i) Full payment (in cash or by check) of any amount that must be withheld by
the Company for federal, state and/or local tax purposes; or
(ii) Full payment by delivery to the Company of shares of the Company's Class A
Common Stock owned by Employee duly endorsed for transfer to the Company by
Employee or other person then entitled to exercise the Option or portion with
an aggregate Fair Market Value equal to the amount that must be withheld by the
Company for federal, state and/or local tax purposes; or
(iii) Full payment by retention by the Company of shares of the Company's Class
A Common Stock to be issued pursuant to such Option exercise with an aggregate
Fair Market Value equal to the amount that must be withheld by the Company for
federal, state and/or local tax purposes; or
(iv) Any combination of payments provided for in the foregoing subsections (i),
(ii) or (iii), subject to any restrictions imposed by the U.S. securities laws
as a result of Employee being an officer or director or otherwise; and
(d) Such representations and documents as the Board, in its absolute
discretion, deems necessary or advisable to effect compliance with all
applicable provisions of the Securities Act and any other federal or state
securities laws or regulations. The Board may, in its absolute discretion, also
take whatever additional actions it deems appropriate to effect such compliance
including, without limitation, placing legends on share certificates and
issuing stop-transfer orders to transfer agents and registrars; and
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(e) In the event the Option or portion shall be exercised pursuant to Section
3.1 by any person or persons other than Employee, appropriate proof of the
right of such person or persons to exercise the Option.
3.4 Conditions to Issuance of Stock Certificates. The Shares
deliverable upon the exercise of the Option, or any portion thereof, may be
either previously authorized but unissued shares or issued shares which have
then been reacquired by the Company. When issued upon exercise of the Option as
provided herein, such Shares shall be fully paid and nonassessable. The Company
shall not be required to issue or deliver any certificate or certificates for
Shares purchased upon the exercise of the Option or portion thereof prior to
fulfillment of all of the following conditions, provided that the Company shall
be obligated to cause all such conditions to be satisfied at the time of
exercise (except as otherwise provided in paragraph (e)):
(a) The admission of such Shares to listing on all stock exchanges on which
such class of stock is then listed; and
(b) The completion of any registration or other qualification of such Shares
under any state or federal law or under rulings or regulations of the
Securities and Exchange Commission or of any other governmental regulatory
body, which the Board shall in its absolute discretion, deem necessary or
advisable; and
(c) The obtaining of any approval or other clearance from any state or federal
governmental agency which the Board shall, in its absolute discretion,
determine to be necessary or advisable; and
(d) The payment to the Company of all amounts which, under federal, state or
local law, it is required to withhold upon exercise of the Option; and
(e) The lapse of such reasonable period of time following the exercise of the
Option as the Board may from time to time establish for reasons of
administrative convenience, but not to exceed five business days.
3.5 Rights as Shareholder. The holder of the Option shall not be,
nor have any of the rights or privileges of, a shareholder of the Company in
respect of any Shares issuable upon the exercise of any part of the Option
unless and until certificates representing such Shares shall have been issued
by the Company to such holder.
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ARTICLE IV
OTHER PROVISIONS
4.1 Option Not Transferable. Neither the Option nor any interest or
right therein or part thereof shall be available to satisfy the debts,
contracts or engagements of Employee or his successors in interest or shall be
subject to disposition by transfer, alienation, anticipation, pledge,
encumbrance, assignment or any other means whether such disposition be
voluntary or involuntary or by operation of law by judgment, levy, attachment,
garnishment or any other legal or equitable proceedings (including bankruptcy)
and any attempted disposition thereof shall be null and void and of no effect;
provided, however, that this Section 4.1 shall not prevent transfers by will or
by the applicable laws of descent and distribution, or transfers of all or part
of the Option to "Permitted Transferees" of Employee as defined in the
Shareholders' Agreement of the Company dated as of the date hereof.
4.2 Shares to Be Reserved. The Company shall at all times during the
term of the Option reserve and keep available such number of shares of Class A
Common Stock as will be sufficient to satisfy the requirements of this
Agreement.
4.3 Notices. Any notice to be given under the terms of this
Agreement to the Company shall be addressed to the Company in care of its
Secretary, and any notice to be given to Employee shall be addressed to him at
the address given beneath his signature hereto. By a notice given pursuant to
this Section 4.3, either party may hereafter designate a different address for
notices to be given to him. Any notice which is required to be given to
Employee shall, if Employee is then deceased, be given to Employee's personal
representative if such representative has previously informed the Company of
his status and address by written notice under this Section 4.3. Any notice
shall be deemed duly given when enclosed in a properly sealed envelope or
wrapper addressed as aforesaid, deposited (with postage prepaid) in a post
office or branch post office regularly main tained by the United States Postal
Service.
4.4 Titles. Titles are provided herein for convenience only and are
not to serve as basis for interpretation or construction of this Agreement.
4.5 Construction. This Agreement shall be administered, interpreted
and enforced under the laws of the State of Delaware.
4.6 Entire Agreement. This Agreement embodies the entire agreement
and understanding of the parties hereto with respect to the subject matter
contained herein and supersedes all prior communications, representations and
negotiations in respect thereto. To the extent that the Option is in
substitution for any prior understandings between Employee and the Company, any
and all rights, entitlements or understandings are hereby extinguished and
Employee waives any claim to any and all such prior understandings.
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IN WITNESS WHEREOF, this Agreement has been executed and delivered by
the parties hereto as of the date first above written.
NEXTEL PARTNERS, INC.
By /s/ Xxxx Xxxxxxx
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Name: Xxxx Xxxxxxx
Title: President and Chief
Executive Officer
/s/ Xxxx X. Xxxxxxxx
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XXXX X. XXXXXXXX
Address: 0000 000xx Xxxxxx X.X.
Xxxxxxxx, XX 00000
SS #:____________________________
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