BEACON ENERGY HOLDINGS, INC. FORM OF NONQUALIFIED STOCK OPTION AGREEMENT
2008
EQUITY INCENTIVE PLAN
This
NONQUALIFIED STOCK OPTION AGREEMENT (the “Option Agreement”), dated as of the
____ day of ___ 20__ (the “Grant Date”), is between Beacon Energy Holdings,
Inc., a Delaware corporation (the “Company”), and _____________ (the
“Optionee”), a director, officer or employees of, or consultant or advisor to,
the Company or a Subsidiary of the Company (a “Related Corporation”), pursuant
to the Beacon Energy Holdings, Inc. 2008 Equity Incentive Plan (the
“Plan”).
WHEREAS,
the Company desires to give the Optionee the opportunity to purchase shares
of
common stock of the Company, par value $0.001 (“Common Shares”) in accordance
with the provisions of the Plan, a copy of which is attached
hereto;
NOW,
THEREFORE, in consideration of the mutual covenants hereinafter set forth and
for other good and valuable consideration, the parties hereto, intending to
be
legally bound hereby, agree as follows:
1. Grant
of Option.
The
Company hereby grants to the Optionee the right and option (the “Option”) to
purchase all or any part of an aggregate of ___________________ (______) Common
Shares. The Option is in all respects limited and conditioned as hereinafter
provided, and is subject in all respects to the terms and conditions of the
Plan
now in effect and as it may be amended from time to time (but only to the extent
that such amendments apply to outstanding options). Such terms and conditions
are incorporated herein by reference, made a part hereof, and shall control
in
the event of any conflict with any other terms of this Option Agreement. The
Option granted hereunder is intended to be a nonqualified stock option (“NQSO”)
and not
an
incentive stock option (“ISO”) as such term is defined in section 422 of the
Internal Revenue Code of 1986, as amended (the “Code”).
2. Exercise
Price.
The
exercise price of the Common Shares covered by this Option shall be $_________
per share. It is the determination of the committee administering the Plan
(the
“Committee”) that on the Grant Date the exercise price was not less than the
greater of (i) 100% of the “Fair Market Value” (as defined in the Plan) of a
Common Share, or (ii) the par value of a Common Share.
3. Term.
Unless
earlier terminated pursuant to any provision of the Plan or of this Option
Agreement, this Option shall expire on ___________ ___, 20__ (the “Expiration
Date”), which date is not more than 10 years from the Grant Date. This Option
shall not be exercisable on or after the Expiration Date.
4. Exercise
of Option.
The
Option shall vest according to the following schedule, provided that Optionee
remains continuously engaged as a director, officer or employees of, or
consultant or advisor to, the Company or a Related Corporation from the date
hereof through the applicable vesting date:
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Date
Installment Becomes Exercisable
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Number
of Shares
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______
Shares
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an
additional ______ Shares
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an
additional ______ Shares
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an
additional ______ Shares
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The
Committee may accelerate any vesting date of the Option, in its discretion,
if
it deems such acceleration to be desirable. Once the Option becomes exercisable,
it will remain exercisable until it is exercised or until it
terminates.
5. Method
of Exercising Option.
Subject
to the terms and conditions of this Option Agreement and the Plan, the Option
may be exercised by written notice to the Company at its principal office.
The
form of such notice is attached hereto and shall state the election to exercise
the Option and the number of whole shares with respect to which it is being
exercised; shall be signed by the person or persons so exercising the Option;
and shall be accompanied by payment of the full exercise price of such shares.
Only full shares will be issued.
The
exercise price shall be paid to the Company:
(a) in
cash,
or by certified check, bank draft, or postal or express money
order;
(b) through
the delivery of Common Shares previously acquired by the Optionee;
(c) by
delivering a properly executed notice of exercise of the Option to the Company
and a broker, with irrevocable instructions to the broker promptly to deliver
to
the Company the amount necessary to pay the exercise price of the
Option;
(d) in
Common
Shares newly acquired by the Optionee upon exercise of the Option;
or
(e) in
any
combination of (a), (b), (c) or (d) above.
In
the
event the exercise price is paid, in whole or in part, with Common Shares,
the
portion of the exercise price so paid shall be equal to the Fair Market Value
of
the Common Shares surrendered on the date of exercise.
Upon
receipt of notice of exercise and payment, the Company shall deliver a
certificate or certificates representing the Common Shares with respect to
which
the Option is so exercised. The Optionee shall obtain the rights of a
shareholder upon receipt of a certificate(s) representing such Common
Shares.
Such
certificate(s) shall be registered in the name of the person so exercising
the
Option (or, if the Option is exercised by the Optionee and if the Optionee
so
requests in the notice exercising the Option, shall be registered in the name
of
the Optionee and the Optionee’s spouse, jointly, with right of survivorship),
and shall be delivered as provided above to, or upon the written order of,
the
person exercising the Option. In the event the Option is exercised by any person
after the death or disability (as determined in accordance with Section 22(e)(3)
of the Code) of the Optionee, the notice shall be accompanied by appropriate
proof of the right of such person to exercise the Option. All Common Shares
that
are purchased upon exercise of the Option as provided herein shall be fully
paid
and non-assessable.
Upon
exercise of the Option, Optionee shall be responsible for all employment and
income taxes then or thereafter due (whether Federal, State or local), and
if
the Optionee does not remit to the Company sufficient cash (or, with the consent
of the Committee, Common Shares) to satisfy all applicable withholding
requirements, the Company shall be entitled to satisfy any withholding
requirements for any such tax by disposing of Common Shares at exercise,
withholding cash from Optionee’s salary or other compensation or such other
means as the Committee considers appropriate to the fullest extent permitted
by
applicable law. Nothing in the preceding sentence shall impair or limit the
Company’s rights with respect to satisfying withholding obligations under
Section 10 of the Plan.
6. Non-Transferability
of Option.
This
Option is not assignable or transferable, in whole or in part, by the Optionee
other than by will or by the laws of descent and distribution. During the
lifetime of the Optionee, the Option shall be exercisable only by the Optionee
or, in the event of his or her disability, by his or her guardian or legal
representative.
7. Termination
of Services.
If the
Optionee’s services with the Company and all Related Corporations are terminated
for any reason (other than death or disability) prior to the Expiration Date,
then this Option may be exercised by Optionee, to the extent of the number
of
Common Shares with respect to which the Optionee could have exercised it on
the
date of such termination of services, at any time prior to the earlier of (i)
the Expiration Date, or (ii) three months after such termination of services.
Any part of the Option that was not exercisable immediately before the
termination of Optionee’s services shall terminate at that
time.
8. Disability.
If the
Optionee becomes disabled (as determined in accordance with section 22(e)(3)
of
the Code) during the period of his or her service and, prior to the Expiration
Date, the Optionee’s services are terminated as a consequence of such
disability, then this Option may be exercised by the Optionee or by the
Optionee’s legal representative, to the extent of the number of Common Shares
with respect to which the Optionee could have exercised it on the date of such
termination of services, at any time prior to the earlier of (i) the Expiration
Date or (ii) one year after such termination of services. Any part of the Option
that was not exercisable immediately before the Optionee’s termination of
services shall terminate at that time.
9. Death.
If the
Optionee dies during the period of his or her services and prior to the
Expiration Date, or if the Optionee’s services are terminated for any reason (as
described in Paragraphs 7 and 8) and the Optionee dies following his or her
termination of services but prior to the earliest of (i) the Expiration Date,
or
(ii) the expiration of the period determined under Paragraph 7 or 8 (as
applicable to the Optionee), then this Option may be exercised by the Optionee’s
estate, personal representative or beneficiary who acquired the right to
exercise this Option by bequest or inheritance or by reason of the Optionee’s
death, to the extent of the number of Common Shares with respect to which the
Optionee could have exercised it on the date of his or her death, at any time
prior to the earlier of (i) the Expiration Date or (ii) one year after the
date
of the Optionee’s death. Any part of the Option that was not exercisable
immediately before the Optionee’s death shall terminate at that
time.
10. Securities
Matters.
(a) If,
at any time, counsel to the Company shall determine that the listing,
registration or qualification of the Common Shares subject to the Option upon
any securities exchange or under any state or federal law, or the consent or
approval of any governmental or regulatory body, or that the disclosure of
non-public information or the satisfaction of any other condition is necessary
as a condition of, or in connection with, the issuance or purchase of Common
Shares hereunder, such Option may not be exercised, in whole or in part, unless
such listing, registration, qualification, consent or approval, or satisfaction
of such condition shall have been effected or obtained on conditions acceptable
to the Board of Directors. The Company shall be under no obligation to apply
for
or to obtain such listing, registration or qualification, or to satisfy such
condition. The Committee shall inform the Optionee in writing of any decision
to
defer or prohibit the exercise of an Option. During the period that the
effectiveness of the exercise of an Option has been deferred or prohibited,
the
Optionee may, by written notice, withdraw the Optionee’s decision to exercise
and obtain a refund of any amount paid with respect thereto.
(b) The
Company may require: (i) the Optionee (or any other person exercising the Option
in the case of the Optionee’s death or Disability) as a condition of exercising
the Option, to give written assurances, in substance and form satisfactory
to
the Company, to the effect that such person is acquiring the Common Shares
subject to the Option for his or her own account for investment and not with
any
present intention of selling or otherwise distributing the same, and to make
such other representations or covenants; and (ii) that any certificates for
Common Shares delivered in connection with the exercise of the Option bear
such
legends, in each case as the Company deems necessary or appropriate, in order
to
comply with federal and applicable state securities laws, to comply with
covenants or representations made by the Company in connection with any public
offering of its Common Shares or otherwise. The Optionee specifically
understands and agrees that the Common Shares, if and when issued upon exercise
of the Option, may be “restricted securities,” as that term is defined in Rule
144 under the Securities Act of 1933 and, accordingly, the Optionee may be
required to hold the shares indefinitely unless they are registered under such
Securities Act of 1933, as amended, or an exemption from such registration
is
available.
(c) The
Optionee shall have no rights as a shareholder with respect to any Common Shares
covered by the Option (including, without limitation, any rights to receive
dividends or non-cash distributions with respect to such shares) until the
date
of issue of a stock certificate to the Optionee for such Common Shares. No
adjustment shall be made for dividends or other rights for which the record
date
is prior to the date such stock certificate is issued.
11. Governing
Law.
This
Option Agreement shall be governed by the applicable Code provisions to the
maximum extent possible. Otherwise, the laws of the State of Delaware (without
reference to the principles of conflict of laws) shall govern the operation
of,
and the rights of the Optionee under, the Plan and Options granted
thereunder.
[SIGNATURE
PAGE FOLLOWS]
IN
WITNESS WHEREOF, the Company has caused this Nonqualified Stock Option Agreement
to be duly executed by its duly authorized officer, and the Optionee has
hereunto set his or her hand and seal, all as of the ____ day of ___,
20__.
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By:
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Name:
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Title:
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Optionee
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2008
EQUITY INCENTIVE PLAN
Notice
of
Exercise of Nonqualified Stock Option
I
hereby
exercise the nonqualified stock option granted to me pursuant to the
Nonqualified Stock Option Agreement dated as of ______________ __, 20__, by
Beacon Energy Holdings, Inc. (the “Company”), with respect to the following
number of shares of the Company’s common stock (“Shares”), par value $0.001 per
Share, covered by said option:
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Number
of Shares to be purchased:
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_______
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Purchase
price per Share:
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$
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_______
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Total
purchase price:
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$
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_______
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___
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A.
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Enclosed
is cash or my certified check, bank draft, or postal or express money
order in the amount of $__________ in full/partial [circle
one]
payment for such Shares;
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and/or
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___
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B.
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Enclosed
is/are
Share(s) with a total fair market value of $
on
the date hereof in full/partial [circle
one]
payment for such Shares;
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and/or
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___
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C.
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I
have provided notice to
[insert
name of broker],
a
broker, who will render full/partial [circle
one]
payment for such Shares.
[Optionee should attach to the notice of exercise provided to such
broker
a copy of this Notice of Exercise and irrevocable instructions to
pay to
the Company the full exercise
price.]
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and/or
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I
elect to satisfy the payment for Shares purchased hereunder by having
the
Company withhold newly acquired Shares pursuant to the exercise of
the
Option.
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Please
have the certificate or certificates representing the purchased Shares
registered in the following name or names*:
;
and
sent to .
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DATED:
________ ___, 20__
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Optionee’s
Signature
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*Certificates
may be registered in the name of the Optionee alone or in the joint names (with
right of survivorship) of the Optionee and his or her spouse.
