NextG Networks, Inc. STOCK OPTION AWARD AGREEMENT
Exhibit 10.5.a
NextG Networks, Inc.
2008 EQUITY INCENTIVE PLAN
Unless otherwise defined in this Stock Option Award Agreement (this “Agreement”), the
defined terms that are contained in the NextG Networks, Inc. 2008 Equity Incentive Plan (the
“Plan”) also apply to this Agreement.
Stock Option Grant Notice
| Participant Name: | ||||||
| Address: | ||||||
You have been granted an Option to purchase NextG Common Stock, subject to the terms and
conditions of the Plan and this Agreement. Your Option includes the following terms:
| Grant Number: | ||||||
| Grant Date: | ||||||
| Vesting Commencement Date: | ||||||
| Per-Share Exercise Price: | $ | |||||
| Total Shares Granted: | ||||||
| Total Exercise Price: | $ | |||||
| Option Type: | Incentive Stock Option | |||||
| Nonstatutory Stock Option | ||||||
| Term/Expiration Date: |
Vesting Schedule:
Subject to any acceleration provisions that may be contained in the Plan or that may be
described below, your Option may be exercised, in whole or in part, according to the following
schedule:
[Of the total granted Option shares that are specified above, 25% of such total granted option
shares will vest on the first anniversary of the vesting commencement date that is specified above,
and 1/48th of such total granted option shares will vest on the last calendar day of
each full calendar month after such first anniversary date, in all cases subject to the requirement
that you continuously retain your Service Provider status throughout such time period on each such
vesting date.]
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Termination Period:
This Option will be exercisable for [30 days] after the date on which your Service Provider
status terminates. However, if your Service Provider status terminates because of death or
Disability, then this Option will be exercisable for [180 days] after the date on which your
Service Provider status terminates. Notwithstanding those exercisability time periods, this Option
cannot, under any circumstances, be exercised after the Term/Expiration Date specified above, and
this Option may be subject to earlier termination as provided in Plan
Section 14(c).
By mutually signing below, you and NextG agree that this Option is granted under, and governed
by, the terms and conditions of the Plan and this Agreement, including the Stock Option Grant Terms
and Conditions, which are attached as Exhibit A, and all of which are part of this
document. By signing below, you also expressly acknowledge and agree that (1) you have reviewed
the Plan and this Agreement in their entirety; (2) you have had a full and fair opportunity to seek
and receive legal advice and other professional advice before signing this Agreement; and (3) you
fully understand all provisions of the Plan and this Agreement. Additionally, by signing this
Agreement and accepting this Option, you also expressly acknowledge and agree to accept as binding,
conclusive, and final all Administrator decisions or interpretations about any questions relating
to the Plan and this Agreement. Finally, you agree to notify NextG upon any change in your
residence from the residence address that you specified below.
PARTICIPANT
|
NEXTG NETWORKS, INC. | |||
Residence Address: |
||||
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EXHIBIT A
NextG Networks, Inc.
STOCK OPTION GRANT TERMS AND CONDITIONS
1. Option Grant and Option Type.
(a) Option Grant. NextG grants to the person named above in the attached Stock Option
Grant Notice (the “Participant”) an option (the “Option”) to purchase the number of
Shares that are specified in the Stock Option Grant Notice, at the per-share exercise price that is
specified in the Stock Option Grant Notice (the “Exercise Price”). This Option grant is
subject to all of the terms and conditions contained in this Agreement and the Plan, which is fully
incorporated into this Agreement by reference. If any conflict arises between this Agreement and
the Plan, then the Plan will control the conflict, unless this Agreement specifically states that
this Agreement controls any such conflict with the Plan in a particular instance. As used
elsewhere in this Agreement, the term “Notice” refers to the Stock Option Grant Notice
attached above.
(b) Option Type. If the Notice specifies that this Option is as an Incentive Stock
Option (“ISO”), then this Option is intended to qualify as an ISO under Section 422 of the
Internal Revenue Code of 1986, as amended (the “Code”). However, even if this Option is
intended to be an ISO, this Option will be treated as a Non-Statutory Stock Option (“NSO”)
to the extent that this Option exceeds the $100,000 rule of Code Section 422(d) or to the extent
that any applicable law prohibits ISO treatment.
2. Vesting Schedule. Except as provided in Section 3, the Option will vest according
to the vesting provisions specified in the Notice. Shares that are scheduled to vest on a certain
date or on the date that a certain condition occurs will not vest under this Agreement, unless the
Participant will have been continuously a Service Provider from the original grant date through and
until such applicable vesting date.
3. Administrator Discretion. In the Administrator’s sole discretion, and at any time,
the Administrator may accelerate vesting for the entire then-remaining balance, or for any lesser
portion of the entire then-remaining balance, of the unvested Option, subject to the Plan’s terms.
If so accelerated, then the Option will be considered as having vested as of the date specified by
the Administrator.
4. Option Exercise.
(a) Exercise Right. This Option may be exercised only during the Option’s term (as
specified in the Notice), and, during such term, this Option may be exercised only on the terms and
conditions contained in the Plan and in this Agreement.
(b) Exercise Method. To validly exercise this Option, (i) the Participant must
complete and deliver to NextG a signed exercise notice in the form attached as Exhibit B or
in a manner and under procedures that the Administrator may determine (the “Exercise
Notice”), which Exercise Notice will specify (A) that the Participant elects to exercise the
Option, (B) the number of
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Shares for which the Option is being exercised (the “Exercised Shares”), and (C) such
other representations and agreements that NextG or the Administrator may require under the Plan’s
terms, and (ii) the Participant must deliver to NextG the entire aggregate Exercise Price payment
for all Exercised Shares together with any applicable tax withholding. This Option will be validly
exercised only when NextG receives the fully completed and signed Exercise Notice accompanied by
such aggregate Exercise Price payment.
5. Payment Method. The Participant may pay the aggregate Exercise Price payment by
any one or more of the following payment methods: (a) by paying cash; (b) by check with a check;
(c) by paying consideration under a formal cashless exercise program that NextG adopts under the
Plan; or (d) by surrendering other Shares that have a Fair Market Value on the surrender date equal
to the aggregate Exercise Price for all Exercised Shares, but only if NextG’s acceptance of such
Shares will not result in any adverse NextG accounting consequences, as determined in the
Administrator’s sole discretion.
6. Tax Obligations.
(a) Tax Withholding. Notwithstanding any contrary Agreement provision, NextG will not
issue to the Participant any certificate representing the Shares, unless and until the Participant
has made satisfactory arrangements (as the Administrator determines) for paying any applicable
income, employment, and other taxes that NextG determines must be withheld with respect to such
Shares. To the extent that NextG determines appropriate in NextG’s sole discretion, NextG will
have the right (but not the obligation) to satisfy any tax withholding obligations by reducing the
number of Shares otherwise deliverable to the Participant. If the Participant fails to make
satisfactory arrangements for paying any such required tax withholding obligations when the
Participant exercises the Option, then the Participant acknowledges and agrees that NextG may
refuse to honor the Option exercise and refuse to deliver any Shares for which such withholding
amounts are not delivered to NextG upon the Option’s exercise.
(b) Disqualifying ISO Disposition Notice. If the Option is an ISO, and if the
Participant sells or otherwise disposes of any of the Shares acquired under the ISO on or before
the later of (i) the second anniversary of the grant date specified in the Notice, or (ii) the date
that is one year after the exercise date, then the Participant will immediately notify NextG in
writing of such sale or other disposition. The Participant expressly acknowledges and agrees that
the Participant may be subject to income tax withholding or other tax withholding by NextG on the
compensation income that the Participant recognizes.
(c) Code Section 409A. Under Code Section 409A, any stock option that vests after
December 31, 2004 and that was granted with a per-share exercise price that the Internal Revenue
Service (the “IRS”) determines to be less than the per-share Fair Market Value on the grant
date (a “Discount Option”) may be considered “deferred compensation.” A Discount Option
may result in (i) income recognition by the Participant before the option’s exercise, (ii) an
additional 20% federal income tax, and (iii) potential penalty and interest charges. The Discount
Option may also result in additional state income tax, penalties, and interest charges to the
Participant. The Participant expressly acknowledges and agrees that NextG does not guarantee,
cannot guarantee, and has not guaranteed that, in any later IRS investigation, the IRS will agree
that this Option’s per-Share exercise price equals or exceeds the per-Share Fair Market Value on
the grant date. The
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Participant agrees that, if the IRS determines that the Option was granted with a per-Share
exercise price that was less than the per-Share Fair Market Value on the grant date, the
Participant will be solely responsible for the Participant’s costs related to any such
determination. By signing this Agreement and accepting the Option, the Participant expressly
agrees that the Participant will also be fully responsible for any and all other tax, accounting,
financial, legal, and other consequences relating to the Option grant, any Option exercise, any
Share sale or disposition, or to any other aspect of the Option or the Shares.
7. Stockholder Rights. Neither the Participant nor any person claiming under or
through the Participant will have any of the rights or privileges of a NextG stockholder with
respect to any Shares deliverable under this Agreement, unless and until one or more certificates
representing such Shares will have been (a) issued, (b) recorded on the records of NextG or NextG’s
transfer agents or registrars, and (c) delivered to the Participant. After such issuance,
recordation, and delivery, the Participant will have all the rights and privileges of a NextG
stockholder with respect to voting such Shares and receiving dividends and distributions on such
Shares.
8. No Continued Service Guarantee. THE PARTICIPANT EXPRESSLY ACKNOWLEDGES AND AGREES
THAT SHARE VESTING UNDER THIS AGREEMENT’S VESTING SCHEDULE IS EARNED ONLY BY CONTINUING AS A
SERVICE PROVIDER AT NEXTG’S WILL (OR AT THE WILL OF THE NEXTG PARENT OR SUBSIDIARY EMPLOYING OR
RETAINING THE PARTICIPANT) AND NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THE OPTION, OR
ACQUIRING SHARES UNDER THIS AGREEMENT. THE PARTICIPANT FURTHER EXPRESSLY ACKNOWLEDGES AND AGREES
THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, AND THIS AGREEMENT’S VESTING
SCHEDULE DO NOT CONSTITUTE ANY EXPRESS OR IMPLIED PROMISE OF CONTINUED EMPLOYMENT OR ENGAGEMENT AS
A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND WILL NOT INTERFERE IN ANY
WAY WITH THE PARTICIPANT’S RIGHT OR NEXTG’S RIGHT (OR THE RIGHT OF THE NEXTG PARENT OR SUBSIDIARY
EMPLOYING OR RETAINING THE PARTICIPANT) TO TERMINATE THE PARTICIPANT’S RELATIONSHIP AS A SERVICE
PROVIDER AT ANY TIME, WITH OR WITHOUT NOTICE, WITH OR WITHOUT CAUSE, AND FOR ANY REASON OR NO
REASON.
9. Notice Addresses. Any notice given to NextG under this Agreement’s terms will be
addressed to NextG, in care of NextG’s [Chief Financial Officer] at NextG Networks, Inc., 0000
X’Xxxxx Xxxxxx, Xxx Xxxx, Xxxxxxxxxx, 00000, or at such other address as NextG may otherwise
designate in writing.
10. Option Not Transferable. This Option may not be transferred in any manner other
than by will or by the laws of descent or distribution, and, during the Participant’s lifetime,
only the Participant may exercise this Option.
11. Binding Agreement. Subject to the Option transferability limitations contained in
this Agreement, this Agreement will be binding upon and inure to the benefit of the parties’
respective heirs, legatees, legal representatives, successors, and assigns.
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12. Additional Stock Issuance Conditions. If NextG determines at any time, and in
NextG’s sole discretion, that listing, registering, or qualifying the Shares on any securities
exchange or under any state or federal law, or that the consent or approval of any governmental
regulatory authority is necessary or desirable as a condition to issuing the Shares to the
Participant (or to the Participant’s estate), then such issuance will not occur, unless and until
such listing, registration, qualification, consent, or approval has been completed and received
free of any conditions that are not acceptable to NextG. NextG will make all reasonable efforts to
satisfy the requirements of any such state or federal law or securities exchange and to complete
and receive any such consent or approval from any such governmental authority. Assuming such
compliance, and for income tax purposes, the Exercised Shares will be considered to be transferred
to the Participant on the date that the Option is exercised with respect to the Exercised Shares.
13. Plan Governs. This Agreement is subject to all of the Plan’s terms and
provisions. If one or more Agreement provisions conflict with one or more Plan provisions, then
the Plan provisions will govern such conflict. Capitalized terms that are used, but that are not
defined, in this Agreement have the same meanings as defined for such terms in the Plan.
14. Administrator Authority. The Administrator will have the power to interpret the
Plan and this Agreement and to adopt such rules for administering, interpreting, and applying the
Plan as are consistent with the Plan, and the Administrator will have the power to interpret or
revoke any such rules (including determining whether or not any Shares subject to the Option have
vested). All Administrator actions, interpretations, and determinations made in good faith will be
final and binding on the Participant, NextG, and all other interested persons. Neither the
Administrator nor any Administrator member will be personally liable for any action, determination,
or interpretation made in good faith with respect to the Plan or this Agreement.
15. Electronic Delivery. In NextG’s sole discretion, NextG may decide to deliver any
documents related to the Option or future Options that may be awarded under the Plan by electronic
means or request the Participant’s consent to participate in the Plan by electronic means. By
signing and delivering this Agreement, the Participant consents to receive all such documents by
electronic delivery and agrees to participate in the Plan through any on-line or electronic system
established and maintained by NextG or another third-party designated by NextG.
16. Captions. All captions, section headings, and section sub-headings that are used
in this Agreement are for convenience only and will not serve as a basis for interpreting or
construing this Agreement.
17. Agreement Severable. If any Agreement provision is held or becomes invalid or
unenforceable, then that provision will be severed from this Agreement’s remaining provisions, and
such invalidity or unenforceability will not affect this Agreement’s remaining provisions.
18. Agreement Modifications. This Agreement constitutes the parties’ entire
understanding on the subjects covered by this Agreement. The Participant expressly represents and
warrants that the Participant is not accepting this Agreement in reliance on any promises,
representations, or inducements other than those specifically contained in this Agreement. Plan
modifications and Agreement modifications can be made only in an express written contract that is
signed by a validly authorized NextG officer. Notwithstanding anything to the contrary in the Plan
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or in this Agreement, NextG reserves the right to revise this Agreement as NextG determines
necessary or advisable, in NextG’s sole discretion and without the Participant’s consent, to comply
with Code Section 409A, to otherwise avoid imposition of any additional tax or income recognition
under Code Section 409A in connection with the Option, or to otherwise avoid violating any
applicable law, rule, or regulation.
19. Plan Amendment, Suspension, or Termination. By accepting the Option, the
Participant expressly represents and warrants that the Participant has received an Option under the
Plan, and has received, read, and understood a Plan description. The Participant expressly
acknowledges and agrees that the Plan is discretionary in nature and that NextG may amend, suspend,
or terminate the Plan at any time.
20. Governing Law. This Agreement will be governed by California state laws, without
giving effect to any California or other conflict-of-law principles. For purposes of litigating
any dispute that arises under the Option, this Agreement, or the Plan, the parties expressly and
irrevocably submit to and consent to California state court personal jurisdiction, and the parties
expressly and irrevocably agree that any such litigation will be initiated in, conducted in,
maintained by, and resolved by Santa Xxxxx County, California superior courts, or the Northern
District of California federal courts, and no other courts. The parties expressly acknowledge and
agree that the Option is granted, is made, and will be performed exclusively in Santa Xxxxx County,
California.
* * * * *
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EXHIBIT B
NextG Networks, Inc.
2008 EQUITY INCENTIVE PLAN
EXERCISE NOTICE
NextG Networks, Inc.
0000 X’Xxxxx Xxxxxx
Xxx Xxxx, Xxxxxxxxxx, 00000
0000 X’Xxxxx Xxxxxx
Xxx Xxxx, Xxxxxxxxxx, 00000
Attention: [Chief Financial Officer]
Option
Exercise. Effective as of today, , ___, the undersigned
purchaser (the “Purchaser”) elects to
purchase shares (the “Shares”)
of NextG Networks, Inc. Common Stock under NextG’s 2008 Equity Incentive Plan (the “Plan”)
and under the Stock Option Award Agreement dated
(the “Agreement”). The purchase
price for the Shares will be
$ ,
as required by the Agreement.
Payment Delivery. With this exercise notice, the Purchaser is delivering to NextG the
full purchase price for the Shares and any required tax withholding that is required to be paid in
connection with the Option exercise.
Purchaser Representations. The Purchaser expressly acknowledges and agrees that the
Purchaser has received, read, and understood the Plan and the Agreement and agrees to comply with
and be bound by the Plan and Agreement terms and conditions.
Stockholder Rights. Until the Shares are actually issued (as demonstrated by the
appropriate entry on the books of NextG or of a duly authorized NextG transfer agent), no right to
vote or receive dividends and no other rights as a stockholder will exist with respect to the
Shares subject to the Option, notwithstanding the Option exercise. The Shares so acquired will be
issued to the Participant as soon as practicable after the Option exercise. No adjustment will be
made for a dividend or other right for which the record date is before the issuance date, except as
may be specifically provided in Plan Section 14
Professional Advice. The Purchaser expressly acknowledges and agrees that the
Purchaser may suffer adverse tax, accounting, financial, legal, and other consequences as a result
of the Option grant, any Option exercise, the Purchaser’s purchase or disposition of the Shares, or
any other aspect of the Option or the Shares. The Purchaser represents that the Purchaser has
consulted with any tax consultants, legal counsel, and other professional advisors that the
Purchaser deems advisable in connection with the purchase or disposition of the Shares and that
Purchaser is not relying on NextG for any tax advice, legal advice, or other professional advice.
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Entire Agreement and Governing Law. The Plan and Agreement are fully incorporated by
reference into this Exercise Notice. This Exercise Notice, the Plan, and the Agreement constitute
the parties’ entire agreement with respect to the subject matter of this Exercise Notice, the Plan,
and the Agreement, and supersede in their entirety all prior undertakings and agreements of NextG
and the Purchaser with respect to such subject matter, and may not be modified adversely to the
Purchaser’s interest, except by a writing signed by NextG and the Purchaser. This Exercise Notice,
the Agreement, and the Plan are governed by internal substantive California laws, but not any
California or other choice-of-law rules.
Submitted by:
|
Accepted by: | |||
PURCHASER
|
NEXTG NETWORKS, INC | |||
Address:
|
||||
| Date Exercise Notice Received | ||||
| Date Exercise Share Payment Received | ||||
(if applicable and if required) |
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