EXHIBIT 10.34
Option No.____
STM WIRELESS, INC.
STOCK OPTION AGREEMENT
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Type of Option (check one): [_] Incentive [_] Nonqualified
This Stock Option Agreement (the "Agreement") is entered into as of ___,
200__, by and between STM Wireless, Inc., a Delaware corporation (the
"Company"), and ____________________________________ (the "Optionee") pursuant
to the Company's 2002 Stock Incentive Plan (the "Plan"). Any capitalized term
not defined herein shall have the same meaning ascribed to it in the Plan.
1. Grant of Option. The Company hereby grants to Optionee an option (the
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"Option") to purchase all or any portion of a total of ________________________
(____) shares (the "Shares") of the Common Stock of the Company at a purchase
price of _____________________ ($_______) per share (the "Exercise Price"),
subject to the terms and conditions set forth herein and the provisions of the
Plan. If the box marked "Incentive" above is checked, then this Option is
intended to qualify as an "incentive stock option" as defined in Section 422 of
the Internal Revenue Code of l986, as amended (the "Code"). If this Option fails
in whole or in part to qualify as an incentive stock option, or if the box
marked "Nonqualified" is checked, then this Option shall to that extent
constitute a nonqualified stock option.
2. Vesting of Option. The right to exercise this Option shall vest in
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installments, and this Option shall be exercisable from time to time in whole or
in part as to any vested installment ("Vested Shares"). Twenty-five percent
(25%) of the Shares shall become Vested Shares on the first anniversary of the
date of this Agreement, and thereafter, the balance of the Shares shall become
Vested Shares in a series of thirty-six (36) successive equal monthly
installments for each full month of Continuous Service provided by the Optionee,
such that 100% of the Shares shall become Vested Shares on the fourth
anniversary of the date of this Agreement.
No additional Shares shall vest after the date of termination of Optionee's
"Continuous Service" (as defined in Section 3 below), but this Option shall
continue to be exercisable in accordance with Section 3 hereof with respect to
that number of shares that have vested as of the date of termination of
Optionee's Continuous Service.
3. Term of Option.
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3.1 Expiration, Disability, Death or Other Employment Termination. The
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right of the Optionee to exercise this Option shall terminate upon the first to
occur of the following:
(a) the expiration of ten (10) years from the date of this
Agreement;
(b) the expiration of one (1) year from the date of termination of
Optionee's Continuous Service if such termination is due to permanent disability
of the Optionee (as defined in Section 22(e)(3) of the Code);
(c) the expiration of one (1) year from the date of termination of
Optionee's Continuous Service if such termination is due to Optionee's death or
if death occurs during the three-month period following termination of
Optionee's Continuous Service pursuant to Section 3(d) below, as the case may
be;
(d) the expiration of three (3) months from the date of termination
of Optionee's Continuous Service if such termination occurs for any reason other
than permanent disability or death; or
(e) upon the consummation of a "Change in Control" (as defined in
Section 2.4 of the Plan), unless such Option is otherwise assumed or replaced
with a new option of comparable value or other New Incentives pursuant to
Section 8 below.
As used herein, the term "Continuous Service" means (i) employment by
either the Company or any parent or subsidiary corporation of the Company, or by
a corporation or a parent or subsidiary of a corporation issuing or assuming a
stock option in a transaction to which Section 424(a) of the Code applies, which
is uninterrupted except for vacations, illness (except for permanent disability,
as defined in Section 22(e)(3) of the Code), or leaves of absence which are
approved in writing by the Company or any of such other employer corporations,
if applicable, (ii) service as a member of the Board of Directors of the Company
until Optionee resigns, is removed from office, or Optionee's term of office
expires and he or she is not reelected, or (iii) so long as Optionee is engaged
as a consultant or Service Provider to the Company or other corporation referred
to in clause (i) above.
4. Exercise of Option. On or after the vesting of any portion of this
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Option in accordance with Sections 2 or 8 hereof, and until termination of the
right to exercise this Option in accordance with Section 3 above, the portion of
this Option which has vested may be exercised in whole or in part by the
Optionee (or, after his or her death, by the person designated in Section 5
below) upon delivery of the following to the Company at its principal executive
offices:
(a) a written notice of exercise which identifies this Agreement
(including the Grant Number listed on the first page of this Agreement) and
states the number of Shares then being purchased (but no fractional Shares may
be purchased);
(b) a check or cash in the amount of the Exercise Price (or payment of
the Exercise Price in such other form of lawful consideration as the
Administrator may approve from time to time under the provisions of Section 5.3
of the Plan);
(c) a check or cash in the amount reasonably requested by the Company to
satisfy the Company's withholding obligations under federal, state or other
applicable tax laws with respect to the taxable income, if any, recognized by
the Optionee in connection with the exercise of this Option (unless the Company
and Optionee shall have made other arrangements for deductions or withholding
from Optionee's wages, bonus or other compensation payable to Optionee, or by
the withholding of Shares issuable upon exercise of this Option or the delivery
of Shares owned by the Optionee in accordance with Section 10.1 of the Plan,
provided such arrangements satisfy the requirements of applicable tax laws); and
(d) a letter, if requested by the Company, in such form and substance as
the Company may require, setting forth the investment intent of the Optionee, or
person designated in Section 5 below, as the case may be.
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5. Death of Optionee; No Assignment. The rights of the Optionee under this
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Agreement may not be assigned or transferred except by will or by the laws of
descent and distribution, and may be exercised during the lifetime of the
Optionee only by such Optionee. Any attempt to sell, pledge, assign,
hypothecate, transfer or dispose of this Option in contravention of this
Agreement or the Plan shall be void and shall have no effect. If the Optionee's
Continuous Service terminates as a result of his or her death, and provided
Optionee's rights hereunder shall have vested pursuant to Section 2 hereof,
Optionee's legal representative, his or her legatee, or the person who acquired
the right to exercise this Option by reason of the death of the Optionee
(individually, a "Successor") shall succeed to the Optionee's rights and
obligations under this Agreement. After the death of the Optionee, only a
Successor may exercise this Option.
6. Representation of Optionee. Optionee acknowledges receipt of a copy of
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the Plan and understands that all rights and obligations connected with this
Option are set forth in this Agreement and the Plan.
7. Adjustments Upon Changes in Capital Structure. In the event that the
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outstanding shares of Common Stock of the Company are hereafter increased or
decreased or changed into or exchanged for a different number or kind of shares
or other securities of the Company by reason of a recapitalization, stock split,
combination of shares, reclassification, stock dividend or other change in the
capital structure of the Company, then appropriate adjustment shall be made by
the Administrator to the number of Shares subject to the unexercised portion of
this Option and to the Exercise Price per share, in order to preserve, as nearly
as practical, but not to increase, the benefits of the Optionee under this
Option, in accordance with the provisions of Section 4.2 of the Plan.
8. Change in Control. In the event of a Change in Control (as defined in
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Section 2.4 of the Plan):
(a) The right to exercise this Option shall accelerate automatically and
vest in full (notwithstanding the provisions of Section 2 above) effective as of
immediately prior to the consummation of the Change in Control unless this
Option is to be assumed by the acquiring or successor entity (or parent thereof)
or a new option or New Incentives are to be issued in exchange therefor, as
provided in subsection (b) below. If vesting of this Option will accelerate
pursuant to the preceding sentence, the Administrator in its discretion may
provide, in connection with the Change in Control transaction, for the purchase
or exchange of this Option for an amount of cash or other property having a
value equal to the difference (or "spread") between: (x) the value of the cash
or other property that the Optionee would have received pursuant to the Change
in Control transaction in exchange for the Shares issuable upon exercise of this
Option had this Option been exercised immediately prior to the Change in
Control, and (y) the aggregate Exercise Price for such Shares. If the vesting of
this Option will accelerate pursuant to this subsection (a), then the
Administrator shall cause written notice of the Change in Control transaction to
be given to the Optionee not less than fifteen (15) days prior to the
anticipated effective date of the proposed transaction.
(b) The vesting of this Option shall not accelerate if and to the
extent that: (i) this Option (including the unvested portion thereof) is to be
assumed by the acquiring or successor entity (or parent thereof) or a new option
of comparable value is to be issued in exchange therefor pursuant to the terms
of the Change in Control transaction, or (ii) in the event the consideration to
be received by the stockholders of the Company in connection with the Change in
Control does not consist of securities, this Option (including the unvested
portion thereof) is to be replaced by the acquiring or successor entity (or
parent thereof) with other incentives of comparable value under a new incentive
program ("New Incentives") containing such terms and provisions as the
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Administrator in its discretion may consider equitable. If this Option is
assumed, or if a new option of comparable value is issued in exchange therefor,
then this Option or the new option shall be appropriately adjusted, concurrently
with the Change in Control, to apply to the number and class of securities or
other property that the Optionee would have received pursuant to the Change in
Control transaction in exchange for the Shares issuable upon exercise of this
Option had this Option been exercised immediately prior to the Change in
Control, and appropriate adjustment also shall be made to the Exercise Price
such that the aggregate Exercise Price of this Option or the new option shall
remain the same as nearly as practicable.
(i) If the provisions of subsection (b) above apply, then this
Option, the new option or the New Incentives shall continue to vest in
accordance with the provisions of Section 2 hereof and shall continue in effect
for the remainder of the term of this Option in accordance with the provisions
of Section 3 hereof.
9. No Employment Contract Created. Neither the granting of this Option nor
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the exercise hereof shall be construed as granting to the Optionee any right
with respect to continuance of employment by the Company or any of its
subsidiaries. The right of the Company or any of its subsidiaries to terminate
at will the Optionee's employment at any time (whether by dismissal, discharge
or otherwise), with or without cause, is specifically reserved.
10. Rights as Stockholder. The Optionee (or transferee of this option by
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will or by the laws of descent and distribution) shall have no rights as a
stockholder with respect to any Shares covered by this Option until such person
has duly exercised this Option, paid the Exercise Price and become a holder of
record of the Shares purchased.
11. "Market Stand-Off" Agreement. Optionee agrees that, if requested by the
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Company or the managing underwriter of any proposed public offering of the
Company's securities, Optionee will not sell or otherwise transfer or dispose of
any Shares held by Optionee without the prior written consent of the Company or
such underwriter, as the case may be, during such period of time, not to exceed
180 days following the effective date of the registration statement filed by the
Company with respect to such offering, as the Company or the underwriter may
specify.
12. Interpretation. This Option is granted pursuant to the terms of the
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Plan, and shall in all respects be interpreted in accordance therewith. The
Administrator shall interpret and construe this Option and the Plan, and any
action, decision, interpretation or determination made in good faith by the
Administrator shall be final and binding on the Company and the Optionee. As
used in this Agreement, the term "Administrator" shall refer to the committee of
the Board of Directors of the Company appointed to administer the Plan, and if
no such committee has been appointed, the term Administrator shall mean the
Board of Directors.
13. Limitation of Liability for Nonissuance. During the term of the Plan,
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the Company agrees at all times to reserve and keep available, and to use its
reasonable best efforts to obtain from any regulatory body having jurisdiction
any requisite authority in order to issue and sell, such number of shares of its
Common Stock as shall be sufficient to satisfy its obligations hereunder and the
requirements of the Plan. Inability of the Company to obtain, from any
regulatory body having jurisdiction, authority deemed by the Company's counsel
to be necessary for the lawful issuance and sale of any shares of its Common
Stock hereunder and under the Plan shall relieve the Company of any liability in
respect of the nonissuance or sale of such shares as to which such requisite
authority shall not have been obtained.
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14. Notices. Any notice, demand or request required or permitted to be
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given under this Agreement shall be in writing and shall be deemed given when
delivered personally or three (3) days after being deposited in the United
States mail, as certified or registered mail, with postage prepaid, (or by such
other method as the Administrator may from time to time deem appropriate), and
addressed, if to the Company, at its principal place of business, Attention: the
Chief Financial Officer, and if to the Optionee, at his or her most recent
address as shown in the employment or stock records of the Company.
15. Governing Law. The validity, construction, interpretation, and effect
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of this Option shall be governed by and determined in accordance with the laws
of the State of California.
16. Severability. Should any provision or portion of this Agreement be held
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to be unenforceable or invalid for any reason, the remaining provisions and
portions of this Agreement shall be unaffected by such holding.
17. Attorneys' Fees. If any party shall bring an action in law or equity
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against another to enforce or interpret any of the terms, covenants and
provisions of this Agreement, the prevailing party in such action shall be
entitled to recover from the other party reasonable attorneys' fees and any
expert witness fees.
18. Counterparts. This Agreement may be executed in two or more
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counterparts, each of which shall be deemed an original and all of which
together shall be deemed one instrument.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
STM WIRELESS, INC. "OPTIONEE"
a Delaware Corporation
By:
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(Signature)
Its:
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(Type or print name)
Address:
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