Authoriszor Inc.
1999 STOCK PLAN
STOCK OPTION AGREEMENT
Unless otherwise defined herein, the terms defined in the Plan shall have the
same defined meanings in this Option Agreement.
I. NOTICE OF STOCK OPTION GRANT ("Notice of Grant")
Name
The undersigned Optionee has been granted an Option to purchase Common Stock of
the Company, subject to the terms and conditions of the Plan and this Option
Agreement, as follows:
Date of Grant:
Vesting Commencement Date:
Exercise Price per Share: $____ ("Exercise Price")
Total Number of Shares Granted:
Type of Option: ___ Incentive Stock Option
Non-statutory Stock Option
Term/Expiration Date:
Vesting Schedule:
This Option shall be exercisable, in whole or in part, according to the
following vesting schedule:
Up to a maximum of 25% of the total number of shares granted in each of the four
years commencing on the Vesting Commencement Date.
Notwithstanding the foregoing, the Administrator in its sole discretion, may
(but is not obligated to) accelerate the date on which all or any portion of an
otherwise unexercisable Option may be exercised.
Termination Period:
The vested portion of this Option shall be exercisable for three months after
Optionee ceases to be a Service Provider; except that upon Optionee's death or
Disability, this Option may be exercised for one year after Optionee ceases to
be a Service Provider. In no event may Optionee exercise this Option after the
Term/Expiration Date as provided above.
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II. AGREEMENT
1. Grant Of Option.
---------------
The Administrator of the Plan hereby grants to the Optionee named in the Notice
of Grant (the "Optionee"), an option (the "Option") to purchase the number of
Shares set forth in the Notice of Grant, at the Exercise Price and subject to
the terms and conditions of the Plan, which is incorporated herein by reference.
Subject to Section 13(c) of the Plan, in the event of a conflict between the
terms and conditions of the Plan and this Option Agreement, the terms and
conditions of the Plan shall prevail.
If designated in the Notice of Grant as an Incentive Stock Option ("ISO"), this
Option is intended to qualify as an Incentive Stock Option as defined in Section
422 of the Code. Nevertheless, to the extent that it exceeds the $100,000 rule
of Code Section 422(d), this Option shall be treated as a Non-statutory Stock
Option ("NSO").
2. Exercise of Option
------------------
(a) Right to Exercise. This Option shall be exercisable during its term in
accordance with the Vesting Schedule set out in the Notice of Grant and
with the applicable provisions of the Plan and this Option Agreement.
(b) Method of Exercise. This Option shall be exercisable by delivery of an
exercise notice in the form attached as Exhibit A (the "Exercise
Notice"), which shall state the election to exercise the Option, the
number of Shares with respect to which the Option is being exercised,
and such other representations and agreements as may be required by the
Company. The Exercise Notice shall be accompanied by payment of the
aggregate Exercise Price as to all Exercised Shares. This Option shall
be deemed to be exercised upon receipt by the Company of such fully
executed Exercise Notice accompanied by the aggregate Exercise Price.
No Shares shall be issued pursuant to the exercise of an Option unless
such issuance and such exercise complies with Applicable Laws. Assuming
such compliance, for income tax purposes the Shares shall be considered
issued to the Optionee on the date on which the Option is exercised
with respect to such Shares.
(c) The Optionee may satisfy his withholding tax obligations by electing to
have the Company withhold from the Shares to be issued upon exercise of
the Options that number of Shares having a Fair Market Value equal to
the amount required to be withheld. The Fair Market Value of the Shares
to be withheld for this purpose shall be made on such forms and under
such conditions as the Administrator may deem necessary or advisable.
3. Optionee's Representations.
--------------------------
In the event the Shares have not been registered under the Securities Act of
1933, as amended (the "Securities Act") , at the time this Option is exercised,
the Optionee shall, if required by the Company, concurrently with the exercise
of all or any portion of this Option, deliver to the Company his or her
Investment Representation Statement in the form attached hereto as Exhibit B.
4. Market Stand Off Period.
-----------------------
Optionee hereby agrees that, if so requested by the Company or any
representative of the underwriters in connection with any registration of the
offering (the "Offering") of any securities of the Company under the Securities
Act, Optionee shall not sell or otherwise transfer any Shares or other
securities of the Company during the 180-day period (or such other period as may
be requested in writing by the Managing Underwriter
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with respect to the Offering and agreed to in writing by the Company) (the
"Market Standoff Period") following the effective date of a registration
statement of the Company filed under the Securities Act. Such restriction shall
apply only to the first registration statement of the Company to become
effective under the Securities Act after the effective date of the Plan that
includes securities to be sold on behalf of the Company to the public in an
underwritten public offering under the Securities Act. The Company may impose
stop-transfer instructions with respect to securities subject to the foregoing
restrictions until the end of such Market Standoff Period.
5. Method of Payment.
-----------------
Payment of the aggregate Exercise Price shall be by any of the following, or a
combination thereof, at the election of the Optionee:
(a) cash or check; or
(b) consideration received by the Company under a formal cashless
exercise program adopted by the Company in connection with the
Plan;
(c) shares including Shares acquired upon exercise of the Option
that have a Fair Market Value on the date of surrender equal
to the aggregate Exercise Price of the Shares as to which such
Option shall be exercised; or
(d) any combination of the foregoing methods of payment.
6. Restrictions on Exercise.
------------------------
This Option may not be exercised if the issuance of such Shares upon such
exercise or the method of payment of consideration for such shares would
constitute a violation of any Applicable Law.
7. Non-Transferability of Option.
-----------------------------
This Option may not be transferred in any manner otherwise than by will or by
the laws of descent or distribution and may be exercised during the lifetime of
Optionee only by Optionee. The terms of the Plan and this Option Agreement shall
be binding upon the executors, administrators, heirs, successors and assigns of
the Optionee.
8. Term of Option.
--------------
This Option may be exercised only within the term set out in the Notice of
Grant, and may be exercised during such term only in accordance with the Plan
and the terms of this Option, subject to the right of the Administrator to amend
or waive certain terms and conditions of the Option and to accelerate the date
on which all or any portion of an otherwise unexerciable Option may be
exercised.
9. Tax Consequences.
----------------
Optionee understands that Optionee may suffer adverse tax consequences as a
result of Optionee's purchase or disposition of the Shares. OPTIONEE REPRESENTS
THAT OPTIONEE HAS CONSULTED WITH ANY TAX CONSULTANTS OPTIONEE DEEMS ADVISABLE IN
CONNECTION WITH THE
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PURCHASE OR DISPOSITION OF THE SHARES AND THAT OPTIONEE IS NOT RELYING ON THE
COMPANY FOR ANY TAX ADVICE.
10. Entire Agreement. Governing Law.
-------------------------------
The Plan is incorporated herein by reference. The Plan and this Option Agreement
constitute the entire agreement of the parties with respect to the subject
matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and Optionee with respect to the subject matter
hereof. This Option Agreement is governed by the internal substantive laws, but
not the choice of law rules, of Delaware.
11. No Guarantee of Continued Service.
---------------------------------
OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE
VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER OR
EMPLOYEE AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING GRANTED THIS
OPTION OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES
THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING
SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF
CONTINUED ENGAGEMENT AS A SERVICE PROVIDER OR EMPLOYEE FOR THE VESTING PERIOD,
FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE IN ANY WAY WITH OPTIONEE'S
RIGHT OR THE COMPANY'S RIGHT TO TERMINATE OPTIONEE'S RELATIONSHIP AS A SERVICE
PROVIDER OR EMPLOYEE AT ANY TIME, WITH OR WITHOUT CAUSE, SUBJECT TO ANY OTHER
CONTRACTUAL TERMS AND CONDITIONS OF ENGAGEMENT.
12. Interpretation.
--------------
(a) If any provision of this Option Agreement is held invalid for any
reason, such holding shall not affect the remaining provisions hereof,
but instead the Option Agreement shall be construed and enforced as if
such provision had never been included in the Option Agreement.
(b) Headings contained in this Option Agreement are for convenience only
and shall in no manner be construed as part of this Option Agreement.
(c) Any reference to the masculine, feminine, or neuter gender shall be
reference to such other gender as is appropriate.
Optionee acknowledges receipt of a copy of the Plan and represents that he or
she is familiar with the terms and provisions thereof, and hereby accepts this
Option subject to all of the terms and provisions thereof. Optionee has reviewed
the Plan and this Option in their entirety, has had an opportunity to obtain the
advice of counsel prior to executing this Option and fully understands all
provisions of the Option. Optionee hereby agrees to accept as binding,
conclusive and final all decisions or interpretations of the Administrator upon
any questions arising under the Plan or this Option. Optionee further agrees to
notify the Company upon any change in the residence address indicated below.
OPTIONEE Authoriszor Inc.
By:
Signature Name:
Title:
Print Name
Residence Address:
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EXHIBIT A
1999 STOCK PLAN
EXERCISE NOTICE
Authoriszor Inc.
[
]
Attention: Secretary
1. Exercise of option. Effective as of today, [ ] the undersigned ("Optionee")
hereby elects to exercise Optionee's option to purchase [ ] shares of the Common
Stock (the "Shares") of Authoriszor Inc. (the "Company") under and pursuant to
the Authoriszor Inc. 1999 Stock Plan (the "Plan") and the Stock Option Agreement
dated [ ] (the "Option Agreement").
2. Delivery of Payment. Purchaser herewith delivers to the Company the Aggregate
Exercise Price of the Shares, as set forth in the Option Agreement, by the
following means [fill in method of payment].
3. Representations of Optionee. Optionee acknowledges that Optionee has
received, read and understood the Plan and the Option Agreement and agrees to
abide by and be bound by their terms and conditions.
4. Rights as Shareholder. Until the issuance of the Shares (as evidenced by the
appropriate entry on the books of the Company or of a duly authorised transfer
agent of the Company), no right to vote or receive dividends or any other rights
as a stockholder shall exist with respect to the Optioned Stock, notwithstanding
the exercise of the Option. The Shares shall be issued to the Optionee
reasonably promptly after the Option is exercised. No adjustment shall be made
for a dividend or other right for which the record date is prior to the date of
issuance.
5. Tax Consultation. Optionee understands that Optionee may suffer adverse tax
consequences as a result of Optionee's purchase or disposition of the Shares.
Optionee represents that Optionee has consulted with any tax consultants
Optionee deems advisable in connection with the purchase or disposition of the
Shares and that Optionee is not relying on the Company for any tax advice.
6. Restrictive Legends and Stop-Transfer Orders
(a) Legends. Optionee understands and agrees that the Company may cause the
legends set forth below or legends substantially equivalent thereto, to be
placed upon any certificate(s) evidencing ownership of the Shares together with
any other legends that may be required by the Company or by state or federal
securities laws:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 AS AMENDED (THE "ACT"), AND MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL
REGISTERED UNDER THE ACT OR, IN THE OPINION OF COMPANY COUNSEL
SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR
TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION
THEREUNDER.
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(b) Stop-Transfer Notices. Optionee agrees that, in order to ensure compliance
with the restrictions referred to herein, the Company may issue appropriate
"stop transfer" instructions to its transfer agent, if any, and that, if the
Company transfers its own securities, it may make appropriate notations to the
same effect in its own records.
(c) Refusal to Transfer. The Company shall not be required (i) to transfer on
its books any Shares that have been sold or otherwise transferred in violation
of any of the provisions of this Agreement or (ii) to treat as owner of such
Shares or to accord the right to vote or pay dividends to any purchaser or other
transferee to whom such Shares shall have been so transferred.
7. Successors and Assigns. The Company may assign any of its rights under this
Agreement to single or multiple assignees, and this Agreement shall inure to the
benefit of the successors and assigns of the Company. Subject to the
restrictions on transfer herein set forth, this Agreement shall be binding upon
Optionee and his or her heirs, executors, administrators, successors and
assigns.
8. Interpretation. Any dispute regarding the interpretation of this Agreement
shall be submitted by Optionee or by the Company forthwith to the Administrator
which shall review such dispute at its next regular meeting. The resolution of
such a dispute by the Administrator shall be final and binding on all parties.
9. Governing Law; Severability. This Agreement is governed by the internal
substantive laws but not the choice of law rules, of Delaware.
10. Entire Agreement. The Plan and Option Agreement are incorporated herein by
reference. This Agreement, the Plan, the Option Agreement and the Investment
Representation Statement constitute the entire agreement of the parties with
respect to the subject matter hereof and supersede in their entirety all prior
undertakings and agreements of the Company and Optionee with respect to the
subject matter hereof, and may not be modified adversely to the Optionee's
interest except by means of a writing signed by the Company and Optionee.
Submitted By: Accepted By:
OPTIONEE Authoriszor Inc.
By:
Signature Name:
Title:
Print Name
Residence Address:
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INVESTMENT REPRESENTATION STATEMENT
OPTIONEE:
COMPANY: Authoriszor Inc.
SECURITY: COMMON STOCK
NUMBER OF SHARES:
DATE:
In connection with the purchase of the above-listed Securities, the undersigned
Optionee represents to the Company the following:
(a) Optionee is aware of the Company's business affairs and financial condition
and has acquired sufficient information about the Company to reach an informed
and knowledgeable decision to acquire the Securities. Optionee is acquiring
these Securities for investment for Optionee's own account only and not with a
view to, or for resale in connection with any "distribution" thereof within the
meaning of the Securities Act of 1933, as amended (the "Securities Act").
(b) Optionee acknowledges and understands that the Securities constitute
"restricted securities" under the Securities Act and have not been registered
under the Securities Act in reliance upon a specific exemption therefrom, which
exemption depends upon, among other things, the bona fide nature of Optionee's
investment intent as expressed herein. In this connection, Optionee understands
that, in the view of the Securities and Exchange Commission, the statutory basis
for such exemption may be unavailable if Optionee's representation was
predicated solely upon a present intention to hold these Securities for the
minimum capital gains period specified under tax statutes, for a deferred sale,
for or until an increase or decrease in the market price of the Securities, or
for a period of one year or any other fixed period in the future. Optionee
further understands that the Securities must be held indefinitely unless they
are subsequently registered under the Securities Act or an exemption from such
registration is available. Optionee further acknowledges and understands that
the Company is under no obligation to register the Securities. Optionee
understands that the certificate evidencing the Securities will be imprinted
with a legend that prohibits the transfer of the Securities unless they are
registered under the Securities Act or such registration is not required under
the Securities Act in the opinion of counsel satisfactory to the Company, and
any other legend required under applicable state or foreign securities laws.
(c) Optionee is familiar with the provisions of Rule 144 promulgated under the
Securities Act, which, in substance, permit limited public resale of "restricted
securities" acquired, directly or indirectly from the issuer thereof, in a
non-public offering subject to the satisfaction of certain conditions.
(d) Optionee further understands that in the event all of the applicable
requirements of Rule 144 are not satisfied, registration under the Securities
Act, compliance with Regulation A, or some other registration exemption will be
required; and that, notwithstanding the fact that Rule 144 is not exclusive, the
Staff of the Securities and Exchange Commission has expressed its opinion that
persons proposing to sell private placement securities other than in a
registered offering and otherwise than pursuant to Rule 144 will have a
substantial burden of proof in establishing that an exemption from registration
is available for such offers or sales, and that such persons and their
respective brokers who participate in such transactions do so at their own risk.
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Optionee understands that no assurances can be given that any such other
registration exemption will be available in such event. Signature of Optionee:
Date:
SCHEDULE OF STOCK OPTION AGREEMENTS
No. of Option Vesting Vesting
Name Options Exercise Date Start Date End Vesting Conditions
Price
------------------- ----------- ------------ ------------- -------------- -----------------------------------------
Xxxxxx 25,000 $2.50 1/1/2001 1/1/2008 Up to a maximum of 6,250 per year starting
Xxxxxxxxx on the vesting date.
Xxxxxx Xxxxxxx 25,000 $6.75 1/1/2001 12/31/2008 Up to a maximum of 6,250 per year starting
on the vesting date.
Xxxxxx Xxxxxxx 75,000 $6.75 4/1/2001 4/1/2008 Options vest subject to certain performance
conditions up to a maximum of 18,750 per
year.
Xxxxxx Xxxx 25,000 $7.10 2/1/2001 2/1/2008 Up to a maximum of 6,250 per year starting
on the vesting date.
Xxxxx Xxxxx 25,000 $10.31 2/1/2001 2/1/2000 Up to a maximum of 6,250 per year starting
on the vesting date.
Xxx Xxxxxxxxxxx 40,000 $10.31 2/1/2001 2/1/2000 Up to a maximum of 10,000 per year
starting on the vesting date.
Xxx Xxxxx 2,000 $10.31 2/1/2001 2/1/2000 Up to a maximum of 500 per year starting
on the vesting date.
Xxxxx Xxxxxxx 1,500 $10.31 2/1/2001 2/1/2008 Up to a maximum of 375 per year starting
on the vesting date.
Xxxx Xxxxxxxxx 2,500 $10.31 2/1/2001 2/1/2008 Up to a maximum of 625 per year starting
on the vesting date.
Xxxx Xxxxx 2,500 $10.31 2/1/2001 2/1/2008 Up to a maximum of 625 per year starting
on the vesting date.
Xxx Xxxx 25,000 $20.00 3/20/2000 4/1/2008 Up to a maximum of 25% per year starting
on the vesting date.
Xxxxx Xxxx 2,500 $20.00 3/20/2000 4/1/2008 Up to a maximum of 25% per year starting
on the vesting date.
Xxxx Xxxxxxx 2,500 $20.00 3/20/2000 4/1/2008 Up to a maximum of 25% per year starting
on the vesting date.
Xxxxxxx Xxxxxxxx 10,000 $20.00 3/20/2000 4/1/2008 Up to a maximum of 25% per year starting
on the vesting date.
============== ============= ============= ============= =============== =====================================
*An employee, director or officer of the Company. +Advisor or consultant to the
Company.
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