Exhibit (d)(12)
XXXXXXXX.XXX, INC.
STOCK OPTION AGREEMENT
RECITALS
A. The Board has adopted the Plan for the purpose of retaining the services
of selected Employees, non-employee members of the Board or of the board of
directors of any Parent or Subsidiary and consultants and other independent
advisors who provide services to the Corporation (or any Parent or
Subsidiary).
B. Optionee is to render valuable services to the Corporation (or a Parent
or Subsidiary), and this Agreement is executed pursuant to, and is intended to
carry out the purposes of, the Plan in connection with the Corporation's grant
of an option to Optionee.
C. All capitalized terms in this Agreement shall have the meaning assigned
to them in the attached Appendix.
NOW, THEREFORE, it is hereby agreed as follows:
1. Grant of Option. The Corporation hereby grants to Optionee, as of the
Grant Date, an option to purchase up to the number of Option Shares
specified in the Grant Notice. The option shares shall be purchasable from
time to time during the option term specified in Paragraph 2 at the Exercise
Price.
2. Option Term. This option shall have a maximum term of ten (10) years
measured from the Grant Date and shall accordingly expire at the close of
business on the day immediately preceding the Expiration Date, unless sooner
terminated in accordance with Paragraph 5 or 6.
3. Limited Transferability. This option shall be neither transferable
nor assignable by Optionee other than to a Beneficiary following Optionee's
death and may be exercised, during Optionee's lifetime, only by Optionee.
However, if this option is designated a Non-Qualified Option in the Grant
Notice, then this option may be assigned in whole or in part during
Optionee's lifetime either as (i) a gift to one or more family members of
Optionee's Immediate Family, to a trust in which Optionee and/or one or more
such family members hold more than fifty percent (50%) of the beneficial
interest or an entity in which more than fifty percent (50%) of the voting
interests are owned by Optionee and/or one or more such family members, or
(ii) pursuant to a domestic relations order. The assigned portion shall be
exercisable only by the person or persons who acquire a proprietary interest
in the option pursuant to such assignment. The terms applicable to the
assigned portion shall be the same as those in effect for this option
immediately prior to such assignment and shall be set forth in such
documents issued to the assignee as the Plan Administrator may deem
appropriate.
4. Vesting and Exercisability. This option shall vest and become
exercisable for the Option Shares in one or more installments as specified
in the Grant Notice. As the option becomes exercisable for such
installments, those installments shall accumulate, and the option shall
remain exercisable for the accumulated installments until the Expiration
Date or sooner termination of the option term under Paragraph 5 or 6.
5. Cessation of Service. The option term specified in Paragraph 2 shall
terminate (and this option shall cease to be outstanding) prior to the
Expiration Date should any of the following provisions become applicable:
(i) Should Optionee cease to remain in Service for any reason (other
than death, Permanent Disability or Misconduct) while this option is
outstanding, then this option shall remain exercisable until the earlier
of (i) the expiration of the three (3)-month period measured from the
date of such cessation of Service or (ii) the Expiration Date.
(ii) Should Optionee die while holding this option, then Optionee's
Beneficiary shall have the right to exercise this option until the
earlier of (A) the expiration of the twelve (12)-month period measured
from the date of Optionee's death or (B) the Expiration Date.
(iii) Should Optionee cease Service by reason of Permanent Disability
while this option is outstanding, then this option shall remain
exercisable until the earlier of (i) the expiration of the twelve (12)-
month period measured from the date of such cessation of Service or (ii)
the Expiration Date.
(iv) During the applicable post-Service exercise period, this option
may not be exercised in the aggregate for more than the number of vested
Option Shares for which the option is exercisable on the date of
Optionee's cessation of Service. Upon the expiration of the applicable
exercise period or (if earlier) upon the Expiration Date, this option
shall terminate and cease to be outstanding for any vested Option Shares
for which the option has not been exercised. However, this option shall,
immediately upon Optionee's cessation of Service for any reason,
terminate and cease to be outstanding to the extent this option is not
otherwise at that time exercisable for vested shares.
(v) Should Optionee's Service be terminated for Cause or for
Misconduct or should Optionee engage in Misconduct while this option is
outstanding, then this option shall terminate immediately and cease to be
outstanding.
6. Special Acceleration of Option.
(a) In the event of a Change in Control, this option, to the extent
outstanding at that time but not otherwise fully exercisable, shall
automatically accelerate so that this option shall, immediately prior to the
effective date of the Change in Control, become exercisable for all of the
Option Shares at the time subject to this option and may be exercised for
any or all of those Option Shares as fully-vested shares of Common Stock. No
such acceleration of this option, however, shall occur if and to the extent:
(i) this option is, in connection with the Change in Control, assumed or
otherwise continued in full force and effect by the successor corporation
(or parent thereof) pursuant to the terms of the Change in Control or (ii)
this option is replaced with a cash incentive program of the successor
corporation which preserves the spread existing at the time of the Change in
Control on the Option Shares for which this option is not otherwise at that
time exercisable (the excess of the Fair Market Value of those Option Shares
over the aggregate Exercise Price payable for such shares) and provides for
subsequent pay-out in accordance with the same option exercise schedule set
forth in the Grant Notice.
(b) Immediately following the consummation of the Change in Control, this
option shall terminate and cease to be outstanding, except to the extent
assumed by the successor corporation (or parent thereof) or otherwise
expressly continued in full force and effect pursuant to the terms of the
Change in Control.
(c) If this option is assumed in connection with a Change in Control,
then this option shall be appropriately adjusted, immediately after such
Change in Control, to apply to the number and class of securities which
would have been issuable to Optionee in consummation of such Change in
Control had the option been exercised immediately prior to such Change in
Control, and appropriate adjustments shall also be made to the Exercise
Price, provided the aggregate Exercise Price shall remain the same. To the
extent the holders of Common Stock receive cash consideration for their
Common Stock in consummation of the Change in Control, the successor
corporation may, in connection with the assumption of this option,
substitute one or more shares of its own common stock with a fair market
value equivalent to the cash consideration paid per share of Common Stock in
such Change in Control.
(d) This Agreement shall not in any way affect the right of the
Corporation to adjust, reclassify, reorganize or otherwise change its
capital or business structure or to merge, consolidate, dissolve, liquidate
or sell or transfer all or any part of its business or assets.
7. Adjustment in Option Shares. Should any change be made to the Common
Stock by reason of any stock split, stock dividend, recapitalization,
combination of shares, exchange of shares or other change affecting the
outstanding Common Stock as a class without the Corporation's receipt of
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consideration, appropriate adjustments shall be made to (i) the total number
and/or class of securities subject to this option and (ii) the Exercise
Price in order to reflect such change and thereby preclude a dilution or
enlargement of benefits hereunder.
8. Stockholder Rights. The holder of this option shall not have any
stockholder rights with respect to the Option Shares until such person shall
have exercised the option, paid the Exercise Price and become a holder of
record of the purchased shares.
9. Manner of Exercising Option. In order to exercise this option with
respect to all or any part of the Option Shares for which this option is at
the time exercisable, Optionee (or any other person or persons exercising
the option) must take the following actions:
(i) Execute and deliver to the Corporation a Notice of Exercise for
the Option Shares for which the option is exercised.
(ii) Pay the aggregate Exercise Price for the purchased shares in one
or more of the following forms:
(A) cash or check made payable to the Corporation;
(B) a promissory note payable to the Corporation, but only to the
extent authorized by the Plan Administrator in accordance with
Paragraph 13;
(C) shares of Common Stock held by Optionee (or any other person or
persons exercising the option) for the requisite period necessary to
avoid a charge to the Corporation's earnings for financial reporting
purposes and valued at Fair Market Value on the Exercise Date; or
(D) through a special sale and remittance procedure pursuant to
which Optionee (or any other person or persons exercising the option)
shall concurrently provide irrevocable instructions (I) to a
Corporation-approved brokerage firm to effect the immediate sale of
the purchased shares and remit to the Corporation, out of the sale
proceeds available on the settlement date, sufficient funds to cover
the aggregate Exercise Price payable for the purchased shares plus all
applicable income and employment taxes required to be withheld by the
Corporation by reason of such exercise and (II) to the Corporation to
deliver the certificates for the purchased shares directly to such
brokerage firm in order to complete the sale.
Except to the extent the sale and remittance procedure is utilized
in connection with the option exercise, payment of the Exercise Price
must accompany the Notice of Exercise delivered to the Corporation in
connection with the option exercise.
(iii) Furnish to the Corporation appropriate documentation that the
person or persons exercising the option (if other than Optionee) have the
right to exercise this option.
(iv) Make appropriate arrangements with the Corporation (or Parent or
Subsidiary employing or retaining Optionee) for the satisfaction of all
income and employment tax withholding requirements applicable to the
option exercise.
(b) As soon as practical after the Exercise Date, the Corporation shall
issue to or on behalf of Optionee (or any other person or persons exercising
this option) a certificate for the purchased Option Shares, with the
appropriate legends affixed thereto.
(c) In no event may this option be exercised for any fractional shares.
10. Compliance with Laws and Regulations.
(a) The exercise of this option and the issuance of the Option Shares
upon such exercise shall be subject to compliance by the Corporation and
Optionee with all applicable requirements of law relating thereto and with
all applicable regulations of any stock exchange (or the Nasdaq National
Market, if applicable) on which the Common Stock may be listed for trading
at the time of such exercise and issuance.
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(b) The inability of the Corporation to obtain approval from any
regulatory body having authority deemed by the Corporation to be necessary
to the lawful issuance and sale of any Common Stock pursuant to this option
shall relieve the Corporation of any liability with respect to the non-
issuance or sale of the Common Stock as to which such approval shall not
have been obtained. The Corporation, however, shall use its best efforts to
obtain all such approvals.
11. Successors and Assigns. Except to the extent otherwise provided in
Paragraphs 3 and 6, the provisions of this Agreement shall inure to the
benefit of, and be binding upon, the Corporation and its successors and
assigns and Optionee and Optionee's assigns and Beneficiaries.
12. Notices. Any notice required to be given or delivered to the
Corporation under the terms of this Agreement shall be in writing and
addressed to the Corporation at its principal corporate offices. Any notice
required to be given or delivered to Optionee shall be in writing and
addressed to Optionee at the address indicated below Optionee's signature
line on the Grant Notice. All notices shall be deemed effective upon
personal delivery or upon deposit in the U.S. mail, postage prepaid and
properly addressed to the party to be notified.
13. Financing. The Plan Administrator may, in its absolute discretion
and without any obligation to do so, permit Optionee to pay the Exercise
Price for the purchased Option Shares by delivering a full-recourse
promissory note payable to the Corporation. The terms of any such promissory
note (including the interest rate, the requirements for collateral and the
terms of repayment) shall be established by the Plan Administrator in its
sole discretion.
14. Construction. This Agreement and the option evidenced hereby are
made and granted pursuant to the Plan and are in all respects limited by and
subject to the terms of the Plan. All decisions of the Plan Administrator
with respect to any question or issue arising under the Plan or this
Agreement shall be conclusive and binding on all persons having an interest
in this option.
15. Governing Law. The interpretation, performance and enforcement of
this Agreement shall be governed by the laws of the State of New York
without resort to that State's conflict-of-laws rules.
16. Excess Shares. If the Option Shares covered by this Agreement
exceed, as of the Grant Date, the number of shares of Common Stock which may
without stockholder approval be issued under the Plan, then this option
shall be void with respect to those excess shares, unless stockholder
approval of an amendment sufficiently increasing the number of shares of
Common Stock issuable under the Plan is obtained in accordance with the
provisions of the Plan.
17. Additional Terms Applicable to an Incentive Stock Option. In the
event this option is designated an Incentive Stock Option in the Grant
Notice, the following terms and conditions shall also apply to the grant:
(i) This option shall cease to qualify for favorable tax treatment as
an Incentive Stock Option if (and to the extent) this option is exercised
for one or more Option Shares: (A) more than three (3) months after the
date Optionee ceases to be an Employee for any reason other than death or
Permanent Disability or (B) more than twelve (12) months after the date
Optionee ceases to be an Employee by reason of Permanent Disability.
(ii) No installment under this option shall qualify for favorable tax
treatment as an Incentive Stock Option if (and to the extent) the
aggregate Fair Market Value (determined at the Grant Date) of the Common
Stock for which such installment first becomes exercisable hereunder
would, when added to the aggregate value (determined as of the respective
date or dates of grant) of the Common Stock or other securities for which
this option or any other Incentive Stock Options granted to Optionee
prior to the Grant Date (whether under the Plan or any other option plan
of the Corporation or any Parent or Subsidiary) first become exercisable
during the same calendar year, exceed One Hundred Thousand Dollars
($100,000) in the aggregate. Should such One Hundred Thousand Dollar
($100,000) limitation be exceeded in any calendar year, this option shall
nevertheless become exercisable for the excess shares in such calendar
year as a Non-Qualified Option.
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(iii) Should the exercisability of this option be accelerated upon a
Change in Control, then this option shall qualify for favorable tax
treatment as an Incentive Stock Option only to the extent the aggregate
Fair Market Value (determined at the Grant Date) of the Common Stock for
which this option first becomes exercisable in the calendar year in which
the Change in Control occurs does not, when added to the aggregate value
(determined as of the respective date or dates of grant) of the Common
Stock or other securities for which this option or one or more other
Incentive Stock Options granted to Optionee prior to the Grant Date
(whether under the Plan or any other option plan of the Corporation or
any Parent or Subsidiary) first become exercisable during the same
calendar year, exceed One Hundred Thousand Dollars ($100,000) in the
aggregate. Should the applicable One Hundred Thousand Dollar ($100,000)
limitation be exceeded in the calendar year of such Change in Control,
the option may nevertheless be exercised for the excess shares in such
calendar year as a Non-Qualified Option.
(iv) Should Optionee hold, in addition to this option, one or more
other options to purchase Common Stock which become exercisable for the
first time in the same calendar year as this option, then the foregoing
limitations on the exercisability of such options as Incentive Stock
Options shall be applied on the basis of the order in which such options
are granted.
18. Leave of Absence. The following provisions shall apply upon the
Optionee's commencement of an authorized leave of absence:
(i) The exercise schedule in effect under the Grant Notice shall be
frozen as of the first day of the authorized leave, and this option shall
not become exercisable for any additional installments of the Option
Shares during the period Optionee remains on such leave.
(ii) Should Optionee resume active Employee status within sixty (60)
days after the start date of the authorized leave, Optionee shall, for
purposes of the exercise schedule set forth in the Grant Notice, receive
Service credit for the entire period of such leave. If Optionee does not
resume active Employee status within such sixty (60)-day period, then no
Service credit shall be given for the period of such leave.
(iii) If this option is designated as an Incentive Stock Option in the
Grant Notice, then the following additional provision shall apply:
(A) If the leave of absence continues for more than ninety (90)
days, then this option shall automatically convert to a Non-Qualified
Option at the end of the three (3)-month period measured from the
ninety-first (91st) day of such leave, unless Optionee's reemployment
rights are guaranteed by statute or by written agreement. Following
any such conversion of this option, all subsequent exercises of this
option, whether effected before or after Optionee's return to active
Employee status, shall result in an immediate taxable event, and the
Corporation shall be required to collect from Optionee the income and
employment withholding taxes applicable to such exercise.
(iv) In no event shall this option become exercisable for any
additional Option Shares or otherwise remain outstanding if Optionee does
not resume Employee status prior to the Expiration Date of the option
term.
19. No Right to Employment. Nothing in this Agreement or the Plan shall
confer upon Optionee any right to continue in Service for any period of
specific duration or interfere with or otherwise restrict in any way the
rights of the Corporation (or any Parent or Subsidiary employing or
retaining Optionee) or of Optionee, which rights are hereby expressly
reserved by each, to terminate Optionee's Service at any time for any
reason, with or without cause.
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EXHIBIT I
NOTICE OF EXERCISE
I hereby notify Xxxxxxxx.xxx, Inc. (the "Corporation") that I elect to
purchase _________ shares of the Corporation's Common Stock (the "Purchased
Shares") at the option exercise price of $__________ per share (the "Exercise
Price") pursuant to that certain option (the "Option") granted to me under the
Corporation's 2000 Stock Incentive Plan on __________________.
Concurrently with the delivery of this Exercise Notice to the Corporation, I
shall hereby pay to the Corporation the Exercise Price for the Purchased
Shares in accordance with the provisions of my agreement with the Corporation
(or other documents) evidencing the Option and shall deliver whatever
additional documents may be required by such agreement as a condition for
exercise. Alternatively, I may utilize the special broker-dealer sale and
remittance procedure specified in my agreement to effect payment of the
Exercise Price.
-----------------------------------
Date
------------------------------------------
Optionee
Address:
----------------------------------
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Print name in exact manner it is to
appear on the stock certificate: ------------------------------------------
Address to which certificate is to ------------------------------------------
if different from address above:
Social Security Number: ------------------------------------------
Employee Number ------------------------------------------
APPENDIX
The following definitions shall be in effect under the Agreement:
A. Agreement or Option Agreement shall mean this Stock Option Agreement.
B. Beneficiary shall mean, in the event the Plan Administrator implements a
beneficiary designation procedure, the person designated by Optionee, pursuant
to such procedure, to succeed to Optionee's rights under the option evidenced
by this Agreement to the extent the option is held by Optionee at the time of
death. In the absence of such designation or procedure, the Beneficiary shall
be the personal representative of the estate of Optionee or the person or
persons to whom the option is transferred by will or the laws of descent and
distribution.
C. Board shall mean the Corporation's Board of Directors.
D. Cause shall have the meaning set forth in Section 5(a) of the Employment
Agreement.
E. Change in Control shall mean a change in ownership or control of the
Corporation effected through any of the following transactions:
(a) a merger, consolidation or reorganization approved by the
Corporation's stockholders, unless securities representing more than fifty
percent (50%) of the total combined voting power of the voting securities of
the successor corporation are immediately thereafter beneficially owned,
directly or indirectly and in substantially the same proportion, by the
persons who beneficially owned the Corporation's outstanding voting
securities immediately prior to such transaction.
(b) any stockholder-approved transfer or other disposition of all or
substantially all of the Corporation's assets, or
(c) the acquisition, directly or indirectly by any person or related
group of persons (other than the Corporation or a person that directly or
indirectly controls, is controlled by, or is under common control with, the
Corporation), of beneficial ownership (within the meaning of Rule 13d-3 of
the 0000 Xxx) of securities possessing more than fifty percent (50%) of the
total combined voting power of the Corporation's outstanding securities
pursuant to a tender or exchange offer made directly to the Corporation's
stockholders which the Board recommends such stockholders to accept.
F. Code shall mean the Internal Revenue Code of 1986, as amended.
G. Common Stock shall mean the Corporation's common stock.
H. Corporation or Company shall mean Xxxxxxxx.xxx, Inc., a Delaware
corporation.
I. Employee shall mean an individual who is in the employ of the Corporation
(or any Parent or Subsidiary), subject to the control and direction of the
employer entity as to both the work to be performed and the manner and method
of performance.
J. Employment Agreement shall mean the Employment Agreement dated
November 25, 2002 between the Corporation and Xxxxxxxx Xxxxx.
K. Exercise Date shall mean the date on which the option shall have been
exercised in accordance with Paragraph 9 of the Agreement.
L. Exercise Price shall mean the exercise price per share as specified in
the Grant Notice.
M. Expiration Date shall mean the date on which the option expires as
specified in the Grant Notice.
N. Fair Market Value per share of Common Stock on any relevant date shall be
determined in accordance with the following provisions:
(i) If the Common Stock is at the time traded on the Nasdaq National
Market, then the Fair Market Value shall be the closing selling price per
share of Common Stock on the date in question, as the price is reported by
the National Association of Securities Dealers on the Nasdaq National Market
or any successor system. If there is no closing selling price for the Common
Stock on the date in question, then
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the Fair Market Value shall be the closing selling price on the last
preceding date for which such quotation exists.
(ii) If the Common Stock is at the time listed on any Stock Exchange,
then the Fair Market Value shall be the closing selling price per share of
Common Stock on the date in question on the Stock Exchange determined by the
Plan Administrator to be the primary market for the Common Stock, as such
price is officially quoted in the composite tape of transactions on such
exchange. If there is no closing selling price for the Common Stock on the
date in question, then the Fair Market Value shall be the closing selling
price on the last preceding date for which such quotation exists. X. Xxxxx
Date shall mean the effective date of grant of the option as specified in
the Grant Notice.
X. Xxxxx Notice shall mean the Notice of Grant of Stock Options accompanying
the Agreement, pursuant to which Optionee has been informed of the basic terms
of the option evidenced hereby.
Q. Immediate Family of Optionee shall mean Optionee's child, stepchild,
grandchild, parent, stepparent, grandparent, spouse, former spouse, sibling,
niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law,
brother-in-law or sister-in-law, including adoptive relationships.
R. Incentive Option or Incentive Stock Option shall mean an option which
satisfies the requirements of Code Section 422.
S. Misconduct shall mean the commission of any act of fraud, embezzlement or
dishonesty by Optionee, any unauthorized use or disclosure by Optionee of
confidential information or trade secrets of the Corporation (or any Parent or
Subsidiary), or any intentional wrongdoing by Optionee, whether by omission or
commission, which adversely affects the business or affairs of the Corporation
(or any Parent or Subsidiary) in a material manner. The foregoing definition
shall not limit the grounds for the dismissal or discharge of Optionee or any
other individual in the Service of the Corporation (or any Parent or
Subsidiary).
T. Non-Qualified Option or Non-Statutory Option shall mean an option not
intended to satisfy the requirements of Code Section 422.
U. Notice of Exercise shall mean the notice of exercise in the form attached
hereto as Exhibit I.
V. Option Shares shall mean the number of shares of Common Stock subject to
the option as specified in the Grant Notice.
W. Optionee shall mean the person to whom the option is granted as specified
in the Grant Notice.
X. Parent shall mean any corporation (other than the Corporation) in an
unbroken chain of corporations ending with the Corporation, provided each
corporation in the unbroken chain (other than the Corporation) owns, at the
time of the determination, stock possessing fifty percent (50%) or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain.
Y. Permanent Disability shall mean the inability of Optionee to engage in
any substantial gainful activity by reason of any medically determinable
physical or mental impairment which is expected to result in death or has
lasted or can be expected to last for a continuous period of twelve (12)
months or more.
Z. Plan or Stock Option Plan shall mean the Corporation's 2000 Stock
Incentive Plan.
AA. Plan Administrator shall mean either the Board or a committee of the
Board acting in its administrative capacity under the Plan.
BB. Service shall mean Optionee's performance of services for the
Corporation (or any Parent or Subsidiary) in the capacity of an Employee, a
non-employee member of the board of directors or a consultant or independent
advisor.
CC. Stock Exchange shall mean the American Stock Exchange or the New York
Stock Exchange.
DD. Subsidiary shall mean any corporation (other than the Corporation) in an
unbroken chain of corporations beginning with the Corporation, provided each
corporation (other than the last corporation) in the unbroken chain owns, at
the time of the determination, stock possessing fifty percent (50%) or more of
the total combined voting power of all classes of stock in one of the other
corporations in such chain.
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ADDENDUM
TO
STOCK OPTION AGREEMENT
The following provisions are hereby incorporated into, and are hereby made a
part of, that certain Stock Option Agreement (the "Option Agreement") by and
between Xxxxxxxx.xxx, Inc. (the "Corporation") and Xxxxxxxx Xxxxx ("Optionee")
evidencing the stock option (the "Option") granted on November 25, 2002 to
Optionee under the terms of the Corporation's 2000 Stock Incentive Plan, and
such provisions shall be effective immediately. All capitalized terms in this
Addendum, to the extent not otherwise defined herein, shall have the meanings
assigned to them in the Option Agreement.
ACCELERATION UPON DEATH, PERMANENT DISABILITY, CHANGE IN
CONTROL OR FAILURE TO ELECT OPTIONEE TO THE BOARD OF DIRECTORS
OF THE CORPORATION
1. Should Optionee die while serving as a member of the Board and while
holding the Option, then the Option, to the extent outstanding at that time
but not otherwise fully exercisable, shall automatically accelerate so that
the Option shall become exercisable for all of the Option Shares at the time
subject to the Option and may be exercised for any or all of those Option
Shares as fully-vested shares of Common Stock.
2. Should Optionee cease serving as a member of the Board by reason of
Permanent Disability while the Option is outstanding, then the Option, to the
extent outstanding at that time but not otherwise fully exercisable, shall
automatically accelerate so that the Option shall become exercisable for all
of the Option Shares at the time subject to the Option and may be exercised
for any or all of those Option Shares as fully-vested shares of Common Stock.
3. In the event of a Change in Control while Optionee is serving as a member
of the Board, the Option, to the extent outstanding at that time but not
otherwise fully exercisable, shall automatically accelerate so that the Option
shall become exercisable for all of the Option Shares at the time subject to
the Option and may be exercised for any or all of those Option Shares as
fully-vested shares of Common Stock.
4. In the event of a failure by the shareholders to reelect the Optionee to
the Board, then the Option shall become exercisable for those additional
Option Shares that were scheduled to vest during the 12 month period from the
date the Optionee leaves the Board and may be exercised for any or all of
those Option Shares as fully-vested shares of Common Stock.
5. The provisions of Paragraphs 1, 2, 3 and 4 above shall supersede any
provisions to the contrary in Paragraphs 5 and 6 of the Option Agreement.
