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EXHIBIT 10.12
FORM
OF
NON-EMPLOYEE DIRECTOR
NON-QUALIFIED STOCK OPTION AGREEMENT
THIS AGREEMENT is made and entered into effective as of the ____ day of
____, 1998 (the "Grant Date") by and between XXXXXXXXXX.XXX, INC. (the
"Company"), a Georgia corporation, and ________________("Grantee").
BACKGROUND
A. The Company maintains the 1998 Long-Term Incentive Plan (the
"Plan"), which permits the Company to grant incentive awards consisting of
Options, Stock Appreciation Rights, Restricted Stock Awards, Performance Share
Awards, Dividend Equivalent Awards and other Stock-Based Awards ("Awards") to
certain officers, employee-directors and other employees of the Company.
However, until such time, if any, as the Common Stock of the Company shall be
traded on a national securities exchange or on the Nasdaq National Market,
non-employee directors of the Company are not eligible to receive Awards under
the Plan.
B. Grantee is a non-employee director and is not at the present
time eligible to receive an Award under the Plan. Although granted outside of
the Plan, the option represented by this Agreement is intended to be generally
consistent with the terms and conditions of the Plan. Therefore, for purposes of
reference only, and not to imply that the option granted hereby is governed by
or issued under the Plan, capitalized terms used herein and not defined in
context are defined in Section 6.11 hereof or in the Plan.
C. The Company and Grantee wish to confirm herein the terms,
conditions, and restrictions of the option.
D. For and in consideration of the premises, the mutual covenants
contained herein, and other good and valuable consideration, the parties hereto
agree:
ARTICLE 1
GRANT AND EXERCISE OF OPTION
1.1 Grant of Option. Subject to the terms, restrictions,
limitations, and conditions stated herein, the Company hereby grants to Grantee
a non-qualified option (the "Option") to purchase all or any part of Ten
Thousand (10,000) shares of the Company's Common Stock (the "Option Shares").
This Option is intended to be a non-qualified stock option.
1.2 Exercise of Option. The Option may be exercised during the
Option Period (as defined in Section 1.4) only to the extent of the number of
Option Shares that are then vested ("Vested Shares") as determined pursuant to
the vesting schedule attached hereto as Schedule I. The Option shall be
exercised by written notice directed to the
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Secretary of the Company at the principal executive offices of the Company, in
substantially the form attached hereto as Exhibit A, or such other form as the
Committee may approve. Such written notice shall be accompanied by full payment
in cash, shares of Stock previously acquired by the Grantee, or any combination
thereof, for the number of shares specified in such written notice; provided,
however, that if shares of Stock are used to pay the exercise price, such shares
must have been held by the Grantee for at least six months. The Fair Market
Value of the surrendered Stock as of the date of the exercise shall be
determined in valuing Stock used in payment of the exercise price. To the extent
permitted under Regulation T of the Federal Reserve Board, and subject to
applicable securities laws, the Option may be exercised through a broker in a
so-called "cashless exercise" whereby the broker sells the Option shares and
delivers cash sales proceeds to the Company in payment of the exercise price.
Subject to the terms of this Option Agreement, the Option may be
exercised at any time and without regard to any other option held by the Grantee
to purchase stock of the Company.
1.3 Option Exercise Price. The price for each share of Stock for
which the Option is exercised is ___________________ ($_____) (the "Option
Exercise Price").
1.4 Term and Termination of Option. Except as otherwise provided
herein, the period in which the Option may be exercised as to any Vested Shares
(the "Option Period") shall commence on the date such shares become Vested
Shares and terminate at 5:00 p.m. Eastern Time on the date of the first to occur
of the following events:
(a) the 10th anniversary of the Grant Date;
(b) if Grantee ceases to be a director of the Company for
any reason other than as provided in paragraph (c) or (d) below, the
Option shall lapse, unless it is previously exercised, ninety (90) days
after Grantee's Termination of Directorship (as defined in Section
6.11); provided, however, that if Grantee's directorship is terminated
by the Company for Cause or by Grantee without the consent of the
Company, the Option shall (to the extent not previously exercised)
lapse immediately;
(c) if Grantee ceases to be a director of the Company by
reason of his Disability, the Option shall lapse, unless it is
previously exercised, one year after Grantee's Termination of
Directorship; or
(d) if Grantee dies while serving as a director, or
during the 90-day period described in paragraph (b) or during the
one-year period described in paragraph (c) and before the Option
otherwise lapses, the Option shall lapse one year after the date of the
Grantee's death. Upon Grantee's death, any exercisable Options may be
exercised by Grantee's legal representative or representatives, by
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the person or persons entitled to do so under Grantee's last will and
testament, or, if Grantee shall fail to make testamentary disposition
of such Option or shall die intestate, by the person or persons
entitled to receive such Option under the applicable laws of descent
and distribution.
1.5 No Rights as Shareholder. Grantee, or, if applicable, any
transferee of Grantee, shall have no rights as a shareholder of the Company with
respect to any Option Shares until the issuance of a stock certificate for such
shares.
1.6 Changes in Capitalization. In the event a stock dividend is
declared upon the Stock, the number of shares of Stock subject to the Option
shall be increased proportionately without any change in the aggregate purchase
price therefor. In the event the Stock shall be changed into or exchanged for a
different number or class of shares of stock or securities of the Company or of
another corporation, whether through reorganization, recapitalization,
reclassification, stock split-up, combination of shares, merger or
consolidation, there shall be substituted for each such share of Stock then
subject to the Option the number and class of shares into which each outstanding
share of Stock shall be so exchanged, all without any change in the aggregate
purchase price for the shares then subject to the Option. In the event the Stock
shall be changed into or exchanged for cash or other property not consisting of
shares of stock or securities of the Company or of another corporation, whether
through reorganization, recapitalization, merger or consolidation, the Committee
may, in its sole discretion, provide (i) that the Option will expire after a
designated period of time to the extent not then exercised, (ii) that the Option
will be settled in cash rather than Stock, (iii) that the Option will be assumed
by another party to the transaction or otherwise be equitably converted in
connection with such transaction, or (iv) any combination of the foregoing.
1.7 Accelerated Vesting.
(a) Upon the occurrence of a Change of Control (as
defined in Section 6.11), the Option shall become fully exercisable and
all restrictions on the Option shall lapse; provided, however, that
such acceleration will not occur if, in the opinion of the Company's
accountants, such acceleration would preclude the use of "pooling of
interest" accounting treatment for a Change of Control transaction that
(i) would otherwise qualify for such accounting treatment, and (ii) is
contingent upon qualifying for such accounting treatment.
(b) Other Events. In the event of the occurrence of any
circumstance, transaction or event not constituting a Change of Control
but which the Board of Directors of the Company deems to be, or to be
reasonably likely to lead to, an effective change in control of the
Company of a nature that would be required to be reported in response
to Item 6(e) of Schedule 14A of the 1934 Act, the Committee may in its
sole discretion declare the Option to be fully exercisable, and/or all
restrictions on the Option to have lapsed, in each case, as of such
date as
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the Committee may, in its sole discretion, declare, which may be on or
before the consummation of such transaction or event. Additionally,
regardless of whether an event has occurred as described in this
Section 1.7, the Committee may in its sole discretion at any time
determine that all or a portion of the Option shall become fully or
partially exercisable, and/or that all or a part of the restrictions on
all or a portion of the Option shall lapse, in each case, as of such
date as the Committee may, in its sole discretion, declare.
(c) Acceleration upon Death or Disability.
Notwithstanding any other provision in this Agreement to the contrary,
upon Grantee's death or Disability during his service as a director,
the Option shall become fully exercisable and all restrictions on the
Option shall lapse. The Option shall thereafter continue or lapse in
accordance with the other provisions of this Agreement.
(d) Effect of Acceleration. If the Option is accelerated
pursuant to Section 1.7 of this Agreement, the Committee may, in its
sole discretion, provide (i) that the Option will expire after a
designated period of time after such acceleration to the extent not
then exercised, (ii) that the Option will be settled in cash rather
than Stock, (iii) that the Option will be assumed by another party to
the transaction giving rise to the acceleration or otherwise be
equitably converted in connection with such transaction, or (iv) any
combination of the foregoing.
ARTICLE 2
LIMITS ON OPTION
2.1 Limits on Transfer. No right or interest of Grantee in the
Option may be pledged, encumbered, or hypothecated to or in favor of any party
other than the Company or a Parent or Subsidiary, or shall be subject to any
lien, obligation, or liability of Grantee to any other party other than the
Company or a Parent or Subsidiary. The Option shall not be assignable or
transferable by Grantee other than by will or the laws of descent and
distribution; provided, however, that the Committee may (but need not) permit
other transfers where the Committee concludes that such transferability (i) does
not result in accelerated taxation, (ii) is otherwise appropriate and desirable,
taking into account any factors deemed relevant, including without limitation,
applicable state or federal tax or securities laws.
2.2 Beneficiaries. Notwithstanding Section 2.1, Grantee may, in
the manner determined by the Committee, designate a beneficiary to exercise the
rights of the Grantee and to receive any distribution with respect to the Option
upon Grantee's death. A beneficiary, legal guardian, legal representative, or
other person claiming any rights under this Agreement is subject to all terms
and conditions of this Agreement applicable to the Grantee, except to the extent
this Agreement otherwise provides, and any additional restrictions deemed
necessary or appropriate by the Committee. If no
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beneficiary has been designated or survives the Grantee, payment shall be made
to the Grantee's estate. Subject to the foregoing, a beneficiary designation may
be changed or revoked by Grantee at any time provided the change or revocation
is filed with the Committee.
ARTICLE 3
REPURCHASE
3.1 Repurchase. The provisions of this Article 3 shall apply only
until such time, if any, as the Stock shall be traded on a national securities
exchange or on the Nasdaq National Market. At any time subsequent to Grantee's
Termination of Directorship, the Company may repurchase, and the Grantee (and
any transferee of Option Shares acquired pursuant to the Option granted
hereunder) shall be obligated to sell, all shares of Option Shares acquired
pursuant to the exercise the Option hereunder for a price equal to the Fair
Market Value of the Option Shares on the date of such repurchase. To exercise
its right to repurchase Option Shares hereunder, the Company shall give written
notice to the Grantee of (i) its election to repurchase the Option Shares, (ii)
the Fair Market Value of the Option Shares to be repurchased, and (iii) the
closing date for the repurchase, which shall be not later than 60 days after the
date of the notice required hereunder. In the case of any repurchase by the
Company of Option Shares under this Article 3, at the option of the Company, the
Company may pay the purchase price to the Grantee (or transferee of the Option
Shares) in four or fewer equal annual installments. Interest shall be credited
on the installments at the applicable federal rate (as determined for purposes
of Section 1274 of the Code) in effect on the date on which the purchase is
made. The Company shall pay at least one-fourth of the total purchase price each
year, plus interest on the unpaid balance, with the first installment being made
on the closing date of the purchase.
3.2 Delivery of Certificate for Option Shares. At any closing of a
purchase by the Company of Option Shares pursuant to this Article 3, a
certificate representing the Option Shares purchased by the Company, duly
endorsed for transfer to the Company, shall be delivered by Grantee (or
transferee of the Option Shares) to the Company at the closing, and upon receipt
of the certificate, the Company shall pay the consideration for the Option
Shares in accordance with Section 3.1.
ARTICLE 4
LEGENDS
4.1 Legends. Each certificate representing the Option Shares
purchased upon exercise of this Option shall be endorsed with the following
legend and Grantee shall not make any transfer of the Option Shares without
first complying with the restrictions on transfer described in such legend:
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TRANSFER IS RESTRICTED
THE SECURITIES EVIDENCED BY THIS CERTIFICATE ARE SUBJECT TO A RIGHT OF
REPURCHASE AND OTHER RESTRICTIONS ON TRANSFER SET FORTH IN A NON-QUALIFIED STOCK
OPTION AGREEMENT DATED JULY 15, 1998, A COPY OF WHICH IS AVAILABLE FROM THE
COMPANY.
THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED,
OR HYPOTHECATED UNLESS (1) THERE IS AN EFFECTIVE REGISTRATION UNDER SUCH ACT
COVERING SUCH SECURITIES, (2) THE TRANSFER IS MADE IN COMPLIANCE WITH RULE 144
PROMULGATED UNDER SUCH ACT, OR (3) THE ISSUER RECEIVES AN OPINION OF COUNSEL,
REASONABLY SATISFACTORY TO THE COMPANY, STATING THAT SUCH SALE, TRANSFER,
ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF SUCH
ACT.
THE SECURITIES HAVE BEEN ISSUED OR SOLD IN RELIANCE ON ONE OR MORE EXEMPTIONS
FROM REGISTRATION UNDER APPLICABLE STATE SECURITIES LAWS, AND MAY NOT BE SOLD OR
TRANSFERRED EXCEPT IN A TRANSACTION WHICH IS EXEMPT UNDER SUCH LAWS OR PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH LAWS.
Grantee agrees that the Company may also endorse any other legends
required by applicable federal or state securities laws.
The Company shall not be required (a) to transfer on its books any
Option Shares that have been sold or transferred in violation of the provisions
of this Agreement (including the foregoing legends), or (b) to treat the owner
of the Option Shares, or otherwise to accord voting or dividend rights to, any
transferee to whom the Option Shares have been transferred in contravention of
this Agreement (or such legends).
ARTICLE 5
WITHHOLDING
5.1 Withholding. The Company, Parent or any Subsidiary shall have the
authority and the right to deduct or withhold, or require Grantee the remit to
the Company, an amount sufficient to satisfy federal, state, and local taxes
(including the Grantee's FICA obligation) required by law to be withheld with
respect to any taxable event arising as a result of the Option. With respect to
withholding required upon any taxable event under the Option, the Committee may,
at the time the Option is granted or thereafter, require that any such
withholding requirement be satisfied, in whole or in part, by withholding Option
Shares having a Fair Market Value on the date of withholding equal to the amount
to be withheld for tax purposes, all in accordance with such procedures as the
Committee establishes.
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ARTICLE 6
GENERAL PROVISIONS
6.1 Governing Laws; Regulations. To the extent not governed by
federal law, this Agreement shall be construed in accordance with and governed
by the laws of the State of Georgia. The obligation of the Company to perform
under this Agreement shall be subject to all applicable laws, rules and
regulations, and to such approvals by government agencies as may be required.
The Company shall be under no obligation to register under the 1933 Act, or any
state securities act, any of the Option Shares. The Option Shares may in certain
circumstances be exempt from registration under the 1933 Act, and the Company
may restrict the transfer of such shares in such manner as it deems advisable to
ensure the availability of any such exemption.
6.2 Successors. This Agreement shall be binding upon and inure to
the benefit of the heirs, legal representatives, successors, and permitted
assigns of the parties.
6.3 Notice. Notices and communications under this Agreement must
be in writing and either personally delivered or sent by registered or certified
United States mail, return receipt requested, postage prepaid. Notice to the
Company must be addressed to:
XxxxXxxxxx.XXX, Inc.
0000 Xxxxxxxx Xxxx.
Xxxxx 000
Xxxxxxxx, Xxxxxxx 00000
Attn: Xx. Xxx Xxxxxx
or any other address designated by the Company in a written notice to Grantee.
Notices to Grantee will be directed to the address of Grantee then currently on
file with the Company, or at any other address given by Grantee in a written
notice to the Company.
6.4 Severability. In the event that any one or more of the
provisions or portion thereof contained in this Agreement shall for any reason
be held to be invalid, illegal, or unenforceable in any respect, the same shall
not invalidate or otherwise affect any other provisions of this Agreement, and
this Agreement shall be construed as if the invalid, illegal or unenforceable
provision or portion thereof had never been contained herein.
6.5 Entire Agreement. This Agreement expresses the entire
understanding and agreement of the parties with respect to the subject matter
hereof. This Agreement may
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be executed in two or more counterparts, each of which shall be deemed an
original but all of which shall constitute one and the same instrument.
6.6 Violation. Except as provided herein, any transfer, pledge,
sale, assignment, or hypothecation of the Option or any portion thereof or of
any Option Shares issued upon exercise hereof shall be a violation of the terms
of this Agreement and shall be void and without effect.
6.7 Headings. Paragraph headings used herein are for convenience
of reference only and shall not be considered in construing this Agreement.
6.8 Specific Performance. In the event of any actual or threatened
default in, or breach of, any of the terms, conditions and provisions of this
Agreement, the party or parties who are thereby aggrieved shall have the right
to specific performance and injunction in addition to any and all other rights
and remedies at law or in equity, and all such rights and remedies shall be
cumulative.
6.9 No Rights to Continued Directorship. The grant of the Option
hereunder shall not be construed as giving Grantee the right to continue to
serve as a director of the Company.
6.10 Fractional Shares. No fractional shares of Stock shall be
issued and the Committee shall determine, in its sole discretion, whether cash
shall be given in lieu of fractional shares or whether such fractional shares
shall be eliminated by rounding up.
6.11 Certain Definitions. The capitalized terms listed below are
used herein with the meaning thereafter ascribed:
(a) "Change of Control" means and includes each of the
following:
(i) The acquisition by any individual, entity or
group (within the meaning of Section 13(d)(3) or 14(d)(2) of
the Exchange Act) (a "Person") of beneficial ownership (within
the meaning of Rule 13d-3 promulgated under the 0000 Xxx) of
25% or more of the combined voting power of the then
outstanding voting securities of the Company entitled to vote
generally in the election of directors (the "Outstanding
Company Voting Securities"); provided, however, that for
purposes of this subsection (i), the following acquisitions
shall not constitute a Change of Control: (A) any acquisition
by a Person who is on the Grant Date the beneficial owner of
25% or more of the Outstanding Company Voting Securities, (B)
any acquisition directly from the Company, including without
limitation a public offering of securities, (C) any
acquisition by the Company, (D) any acquisition by any
employee benefit plan (or related trust) sponsored or
maintained by the Company or any corporation
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controlled by the Company, or (E) any acquisition by any
corporation pursuant to a transaction which complies with
clauses (A), (B) and (C) of subsection (iii) of this
definition; or
(ii) Individuals who, as of (and including) the
Grant Date, constitute the Board (the "Incumbent Board") cease
for any reason to constitute at least a majority of the Board;
provided, however, that any individual becoming a director
subsequent to the Grant Date whose election, or nomination for
election by the Company's shareholders, was approved by a vote
of at least a majority of the directors then comprising the
Incumbent Board shall be considered as though such individual
were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election
contest with respect to the election or removal of directors
or other actual or threatened solicitation of proxies or
consents by or on behalf of a Person other than the Board of
Directors of the Company; or
(iii) Consummation of a reorganization, merger or
consolidation to which the Company is a party or sale or other
disposition of all or substantially all of the assets of the
Company (a "Business Combination"), in each case, unless,
following such Business Combination, (A) all or substantially
all of the individuals and entities who were the beneficial
owners of the Outstanding Company Voting Securities
immediately prior to such Business Combination beneficially
own, directly or indirectly, more than 50% of the combined
voting power of the then outstanding voting securities
entitled to vote generally in the election of directors of the
corporation resulting from such Business Combination
(including, without limitation, a corporation which as a
result of such transaction owns the Company or all or
substantially all of the Company's assets either directly or
through one or more subsidiaries) in substantially the same
proportions as their ownership, immediately prior to such
Business Combination of the Outstanding Company Voting
Securities, and (B) no Person (excluding any corporation
resulting from such Business Combination or any employee
benefit plan (or related trust) of the Company or such
corporation resulting from such Business Combination)
beneficially owns, directly or indirectly, 25% or more of the
combined voting power of the then outstanding voting
securities of such corporation resulting from such Business
Combination except to the extent that such ownership existed
prior to the Business Combination, and (C) at least a majority
of the members of the board of directors of the corporation
resulting from such Business Combination were members of the
Incumbent Board (including persons deemed to be members of the
Incumbent Board by reason of the proviso to subsection (ii) of
this
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definition) at the time of the execution of the initial
agreement, or of the action of the Board of Directors of the
Company, providing for such Business Combination.
(b) "Committee" means the Committee designated by the
Board of Directors of the Company to administer the Plan. The Committee
shall also administer the Option granted hereby and, in such
connection, shall have all the authority granted to the Committee under
the Plan as if the Option had been granted thereunder. Notwithstanding
anything to the contrary contained herein: (i) until the Board of
Directors shall appoint the members of the Committee, the Option shall
be administered by the Board of Directors, and (ii) the Board of
Directors may, in its sole discretion, at any time and from time to
time, resolve to administer the Option. In either of the foregoing
events, unless otherwise provided herein, the term Committee as used
herein shall be deemed to mean the Board of Directors.
(c) "Disability" means any illness or other physical or
mental condition of Grantee that renders Grantee incapable of
performing his customary and usual duties for the Company, or any
medically determinable illness or other physical or mental condition
resulting from a bodily injury, disease or mental disorder which, in
the judgment of the Committee, is permanent and continuous in nature.
The Committee may require such medical or other evidence as it deems
necessary to judge the nature and permanency of Grantee's condition.
(d) "Fair Market Value," on any given date, means (i) if
the Stock is not listed on a securities exchange or traded over the
Nasdaq National Market or otherwise publicly quoted or traded, Fair
Market Value will be determined by such method as the Committee
determines in good faith to be reasonable; (ii) if the Stock is listed
on a securities exchange or is traded over the Nasdaq National Market,
the closing sales price on such exchange or the last reported sale
price over such system on such date or, in the absence of reported
sales on such date, the closing sales price or last sale price, as
applicable on the immediately preceding date on which sales were
reported; or (iii) if the Stock is not listed on a securities exchange
or traded over the Nasdaq National Market, the mean between the bid and
offered prices as quoted by Nasdaq or, if not quoted on Nasdaq, other
recognized quotations service selected by the Committee in good faith
for such date, provided that if it is determined that the Fair Market
Value is not properly reflected by such Nasdaq quotations, Fair Market
Value will be determined by such other method as the Committee
determines in good faith to be reasonable.
(e) "Parent" means a corporation which owns or
beneficially owns a majority of the outstanding voting stock or voting
power of the Company.
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(f) "Stock" means the $.01 par value Common Stock of the
Company and such other securities of the Company as may be substituted
for Stock pursuant to Section 1.6.
(g) "Subsidiary" means any corporation, limited liability
company, partnership or other entity of which a majority of the
outstanding voting stock or voting power is beneficially owned directly
or indirectly by the Company.
(h) "Termination of Directorship" means the termination
of Grantee's service as a director of the Company, regardless of the
fact that severance or similar payments are made to Grantee, for any
reason, including, but not by way of limitation, a termination by
resignation, discharge, death, Disability, or retirement. The Committee
shall, in its absolute discretion, determine the effect of all matters
and questions relating to Termination of Directorship, including, but
not by way of limitation, the question of whether a leave of absence
constitutes a Termination of Directorship, or whether a Termination of
Directorship is for Cause.
(i) "1933 Act" means the Securities Act of 1933, as
amended from time to time.
(j) "1934 Act" means the Securities Exchange Act of 1934,
as amended from time to time.
(signatures on following page)
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IN WITNESS WHEREOF, the parties have executed and sealed this Agreement
on the day and year first set forth above.
XXXXXXXXXX.XXX, INC.
By:
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Title:
GRANTEE:
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EXHIBIT A
TO
XXXXXXXXXX.XXX, INC.
NON-QUALIFIED STOCK OPTION AGREEMENT
Notice of Exercise
Name
--------------------------------------
Address
-----------------------------------
-------------------------------------------
Date
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XxxxXxxxxx.XXX, Inc.
0000 Xxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxx, Xxxxxxx 00000
Re: Exercise of Stock Option
Gentlemen:
I hereby give notice of my election to exercise options granted to me
to purchase ________ shares of common stock (the "Common Stock") of
XxxxXxxxxx.XXX, Inc. (the "Company") under that certain Non-Qualified Stock
Option Agreement dated July 15, 1998 (the "Agreement"). The purchase shall take
place as of ___________ (the "Exercise Date").
On or before the Exercise Date, I will present you with a certified
check (or bank cashier's check) for $__________ for the full purchase price
payable to the order of __________________________.
I hereby represent, warrant, covenant, and agree with the Company as
follows:
The shares of the Common Stock being acquired by me will be
acquired for my own account without the participation of any other
person, with the intent of holding the Common Stock for investment and
without the intent of participating, directly or indirectly, in a
distribution of the Common Stock and not with a view to, or for resale
in connection with, any distribution of the Common Stock, nor am I
aware of the existence of any distribution of the Common Stock;
I am not acquiring the Common Stock based upon any
representation, oral or written, by any person with respect to the
future value of, or income from, the Common Stock but rather upon an
independent examination and judgment as to the prospects of the
Company;
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The Common Stock was not offered to me by means of publicly
disseminated advertisements or sales literature, nor am I aware of any
offers made to other persons by such means;
I am able to bear the economic risks of the investment in the
Common Stock including the risk of a complete loss of my investment
therein;
I understand and agree that the Common Stock will be issued
and sold to me without registration under any state law relating to the
registration of securities for sale, and will be issued and sold in
reliance on the exemptions from registration under the Securities Act
of 1933 (the "1933 Act"), provided by Sections 3(b) and/or 4(2) thereof
and the rules and regulations promulgated thereunder;
The Common Stock cannot be offered for sale, sold or
transferred by me other than pursuant to: (A) an effective registration
under the 1933 Act or in a transaction, otherwise in compliance with
the 1933 Act; and (B) evidence satisfactory to the Company of
compliance with the applicable securities laws of other jurisdictions.
The Company shall be entitled to rely upon an opinion of counsel
satisfactory to it with respect to compliance with the above laws;
The Company will be under no obligation to register the Common
Stock or comply with any exemption available for sale of the Common
Stock without registration or filing, and the information or conditions
necessary to permit routine sale of securities of the Company under
Rule 144 of the 1933 Act are not now available and no assurance has
been given that it or they will become available. The Company is under
no obligation to act in any manner so as to make Rule 144 available
with respect to the Common Stock;
I have and have had complete access to and the opportunity to
review and make copies of all material documents related to the
business of the Company, including, but not limited to, contracts,
financial statements, tax returns, leases, deeds and other books and
records. I have examined such of these documents as I wished and am
familiar with the business and affairs of the Company. I realize that
purchase of the Common Stock is a speculative investment and that any
possible profit therefrom is uncertain;
I have had the opportunity to ask questions of and receive
answers from the Company and any person acting on its behalf and to
obtain all material informal reasonably available with respect to the
Company and its affairs. I have received all information and data with
respect to the Company which I have requested and which I have deemed
relevant in connection with the evaluation of the merits and risks of
investment in the Company;
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I have such knowledge and experience in financial and business
matters that I am capable of evaluating the merits and risks of the
purchase of the Common Stock hereunder and I am able to bear the
economic risk of such purchase; and
The agreements, representations, warranties, and covenants
made by me herein extend to and apply to all of the Common Stock of the
Company issued to me pursuant to this Option. Acceptance by me of the
certificate representing such Common Stock shall constitute a
confirmation by me that all such agreements, representations,
warranties, and covenants made herein shall be true and correct at that
time.
I understand that the certificates representing the shares being
purchased by me in accordance with this notice shall bear a legend referring to
the foregoing covenants, representations and warranties and restrictions on
transfer, and I agree that a legend to that effect may be placed on any
certificate which may be issued to me as a substitute for the certificates being
acquired by me in accordance with this notice.
Very truly yours,
---------------------------------
AGREED TO AND ACCEPTED:
XXXXXXXXXX.XXX, INC.
By:
----------------------------
Title:
-------------------------
Number of Shares
Exercised:
--------------------
Number of Shares
Remaining: Date:
--------------------- ----------------------------
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