Exhibit (d)(B)
BAYCORP HOLDINGS, LTD.
NON-STATUTORY STOCK OPTION AGREEMENT
1. Grant of Option. BayCorp Holdings, Ltd., a Delaware corporation (the
"Company"), hereby grants to ______________________ (the "Optionee") an option,
pursuant to the Company's 1996 Stock Option Plan (the "Plan"), to purchase an
aggregate of ___________ shares of Common Stock ("Common Stock") of the Company
at a price of $______ per share, purchasable as set forth in and subject to the
terms and conditions of this option and the Plan. Except where the context
otherwise requires, the term "Company" shall include the parent and all present
and future subsidiaries of the Company as defined in Sections 424(e) and 424(f)
of the Internal Revenue Code of 1986, as amended or replaced from time to time
(the "Code").
2. Non-Statutory Stock Option. This option is not intended to qualify
as an incentive stock option within the meaning of Section 422 of the Code.
3. Exercise of Option and Provisions for Termination.
(a) Vesting Schedule. Except as otherwise provided in this
Agreement, this option may be exercised prior to the seventh anniversary of the
date of grant (hereinafter the "Expiration Date") in installments as to not more
than the number of shares set forth in the table below during the respective
installment periods set forth in the table below.
Number of
Shares as to which
Exercise Period Option is Exercisable
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Prior to ________________, 19__ -0-
On or after _____________, 19__ _____
but prior to _____________, 19__
On or after _____________, 19__ _____
but prior to _____________, 19__
On or after _____________, 19__ _____
but prior to _____________, 19__
On or after _____________, 19__ _____
The right of exercise shall be cumulative so that if the option is not exercised
to the maximum extent permissible during any exercise period, it shall be
exercisable, in whole or in part, with
respect to all shares not so purchased at any time prior to the Expiration Date
or the earlier termination of this option. This option may not be exercised at
any time on or after the Expiration Date, except as otherwise provided in
Section 3(e) below.
(b) Exercise Procedure. Subject to the conditions set forth in
this Agreement, this option shall be exercised by the Optionee's delivery of
written notice of exercise to the Treasurer of the Company, specifying the
number of shares to be purchased and the purchase price to be paid therefor and
accompanied by payment in full in accordance with Section 4. Such exercise shall
be effective upon receipt by the Treasurer of the Company of such written notice
together with the required payment. The Optionee may purchase less than the
number of shares covered hereby, provided that no partial exercise of this
option may be for any fractional share or for fewer than ten whole shares.
(c) Continuous Relationship with the Company Required. Except
as otherwise provided in this Section 3, this option may not be exercised unless
the Optionee, at the time he or she exercises this option, is, and has been at
all times since the date of grant of this option, an employee, officer or
director of, or consultant or advisor to, the Company (an "Eligible Optionee").
(d) Termination of Relationship with the Company. If the
Optionee ceases to be an Eligible Optionee for any reason, then, except as
provided in paragraphs (e) and (f) below, the right to exercise this option
shall terminate _____ months after such cessation (but in no event after the
Expiration Date), provided that this option shall be exercisable only to the
extent that the Optionee was entitled to exercise this option on the date of
such cessation. Notwithstanding the foregoing, if the Optionee, prior to the
Expiration Date, materially violates the non-competition or confidentiality
provisions of any employment contract, confidentiality and nondisclosure
agreement or other agreement between the Optionee and the Company, the right to
exercise this option shall terminate immediately upon written notice to the
Optionee from the Company describing] such violation.
(e) Exercise Period Upon Death or Disability. If the Optionee
dies or becomes disabled (within the meaning of Section 22(e)(3) of the Code)
prior to the Expiration Date while he or she is an Eligible Optionee, or if the
Optionee dies within three months after the Optionee ceases to be an Eligible
Optionee (other than as the result of a termination of such relationship by the
Company for "cause" as specified in paragraph (f) below), this option shall be
exercisable, within the period of ____ following the date of death or disability
of the Optionee (whether or not such exercise occurs before the Expiration
Date), by the Optionee or by the person to whom this option is transferred by
will or the laws of descent and distribution, provided that this option shall be
exercisable only to the extent that this option was exercisable by the Optionee
on the date of his or her death or disability. Except as otherwise indicated by
the context, the term "Optionee", as used in this option, shall be deemed to
include the estate of the Optionee or any person who acquires the right to
exercise this option by bequest or inheritance or otherwise by reason of the
death of the Optionee.
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(f) Discharge for Cause. If the Optionee, prior to the
Expiration Date, is discharged by the Company for "cause" (as defined below),
the right to exercise this option shall terminate immediately upon such
cessation of employment. "Cause" shall mean willful misconduct by the Optionee
or willful failure to perform his or her responsibilities in the best interests
of the Company (including, without limitation, breach by the Optionee of any
provision of any employment, consulting, advisory, nondisclosure,
non-competition or other similar agreement between the Optionee and the
Company), as determined by the Company, which determination shall be conclusive.
The Optionee shall be considered to have been discharged "for cause" if the
Company determines, within 30 days after the Optionee's resignation, that
discharge for cause was warranted.
4. Payment of Purchase Price.
(a) Method of Payment. Payment of the purchase price for
shares purchased upon exercise of this option shall be made (i) by delivery to
the Company of cash or a check to the order of the Company in an amount equal to
the purchase price of such shares, (ii) subject to the consent of the Company,
by delivery to the Company of shares of Common Stock of the Company then owned
by the Optionee having a fair market value equal in amount to the purchase price
of such shares, (iii) by any other means which the Board of Directors determines
are consistent with the purpose of the Plan and with applicable laws and
regulations (including, without limitation, the provisions of Rule 16b-3 under
the Securities Exchange Act of 1934 and Regulation T promulgated by the Federal
Reserve Board), or (iv) by any combination of such methods of payment.
(b) Valuation of Shares or Other Non-Cash Consideration
Tendered in Payment of Purchase Price. For the purposes hereof, the fair market
value of any share of the Company's Common Stock or other non-cash consideration
which may be delivered to the Company in exercise of this option shall be
determined in good faith by the Board of Directors of the Company.
(c) Delivery of Shares Tendered in Payment of Purchase Price.
If the Optionee exercises this option by delivery of shares of Common Stock of
the Company, the certificate or certificates representing the shares of Common
Stock of the Company to be delivered shall be duly executed in blank by the
Optionee or shall be accompanied by a stock power duly executed in blank
suitable for purposes of transferring such shares to the Company. Fractional
shares of Common Stock of the Company will not be accepted in payment of the
purchase price of shares acquired upon exercise of this option.
(d) Restrictions on Use of Option Stock. Notwithstanding the
foregoing, no shares of Common Stock of the Company may be tendered in payment
of the purchase price of shares purchased upon exercise of this option if the
shares to be so tendered were acquired within twelve (12) months before the date
of such tender, through the exercise of an option granted
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under the Plan or any other stock option or restricted stock plan of the
Company.
5. Delivery of Shares; Compliance With Securities Laws, Etc.
(a) General. The Company shall, upon payment of the option
price for the number of shares purchased and paid for, make prompt delivery of
such shares to the Optionee, provided that if any law or regulation requires the
Company to take any action with respect to such shares before the issuance
thereof, then the date of delivery of such shares shall be extended for the
period necessary to complete such action.
(b) Listing, Qualification, Etc. This option shall be subject
to the requirement that if, at any time, counsel to the Company shall determine
that the listing, registration or qualification of the shares subject hereto
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 shares
hereunder, this option may not be exercised, in whole or in part, unless such
listing, registration, qualification, consent or approval, disclosure or
satisfaction of such other condition shall have been effected or obtained on
terms acceptable to the Board of Directors. Nothing herein shall be deemed to
require the Company to apply for, effect or obtain such listing, registration,
qualification or disclosure, or to satisfy such other condition.
6. Nontransferability of Option. This option is personal and no rights
granted hereunder may be transferred, assigned, pledged or hypothecated in any
way (whether by operation of law or otherwise) nor shall any such rights be
subject to execution, attachment or similar process, except that this option may
be transferred (i) by will or the laws of descent and distribution or (ii)
pursuant to a qualified domestic relations order as defined in Section 414(p) of
the Code. Upon any attempt to transfer, assign, pledge, hypothecate or otherwise
dispose of this option or of such rights contrary to the provisions hereof, or
upon the levy of any attachment or similar process upon this option or such
rights, this option and such rights shall, at the election of the Company,
become null and void.
7. No Special Employment or Similar Rights. Nothing contained in the
Plan or this option shall be construed or deemed by any person under any
circumstances to bind the Company to continue the employment or other
relationship of the Optionee with the Company for the period within which this
option may be exercised.
8. Rights as a Shareholder. The Optionee shall have no rights as a
shareholder with respect to any shares which may be purchased by exercise of
this option (including, without limitation, any rights to receive dividends or
non-cash distributions with respect to such shares) unless and until a
certificate representing such shares is duly issued and delivered to the
Optionee. 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.
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9. Adjustment Provisions.
(a) General. If, through or as a result of any merger,
consolidation, sale of all or substantially all of the assets of the Company,
reorganization, recapitalization, reclassification, stock dividend, stock split,
reverse stock split or other similar transaction, (i) the outstanding shares of
Common Stock are increased or decreased or are exchanged for a different number
or kind of shares or other securities of the Company, or (ii) additional shares
or new or different shares or other securities of the Company or other non-cash
assets are distributed with respect to such shares of Common Stock or other
securities, the Optionee shall, with respect to this option or any unexercised
portion hereof, be entitled to the rights and benefits, and be subject to the
limitations, set forth in Section 15(a) of the Plan.
(b) Board Authority to Make Adjustments. Any adjustments under
this Section 9 will be made by the Board of Directors, whose determination as to
what adjustments, if any, will be made and the extent thereof will be final,
binding and conclusive. No fractional shares will be issued pursuant to this
option on account of any such adjustments.
10. Mergers, Consolidation, Distributions, Liquidations, Etc. In the
event of a merger or consolidation or sale of all or substantially all of the
assets of the Company in which outstanding shares of Common Stock are exchanged
for securities, cash or other property of any other corporation or business
entity, or in the event of a liquidation of the Company, prior to the Expiration
Date or termination of this option, the Optionee shall, with respect to this
option or any unexercised portion hereof, be entitled to the rights and
benefits, and be subject to the limitations, set forth in Section 16(a) of the
Plan.
11. Withholding Taxes. The Company's obligation to deliver shares upon
the exercise of this option shall be subject to the Optionee's satisfaction of
all applicable federal, state and local income and employment tax withholding
requirements.
12. Investment Representations; Legends.
(a) Representations. The Optionee represents, warrants and
covenants that:
(i) Any shares purchased upon exercise of this option
shall be acquired for the Optionee's account for investment
only, and not with a view to, or for sale in connection with,
any distribution of the shares in violation of the Securities
Act of 1933 (the "Securities Act"), or any rule or regulation
under the Securities Act.
(ii) The Optionee has had such opportunity as he or
she has deemed adequate to obtain from representatives of the
Company such information as is necessary to permit the
Optionee to evaluate the merits and risks of his or her
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investment in the Company.
(iii) The Optionee is able to bear the economic risk
of holding such shares acquired pursuant to the exercise of
this option for an indefinite period.
(iv) The Optionee understands that (A) the shares
acquired pursuant to the exercise of this option will not be
registered under the Securities Act and are "restricted
securities" within the meaning of Rule 144 under the
Securities Act; (B) such shares cannot be sold, transferred or
otherwise disposed of unless they are subsequently registered
under the Securities Act or an exemption from registration is
then available; (C) in any event, an exemption from
registration under Rule 144 or otherwise under the Securities
Act not be available for at least two years and even then will
not be available unless a public market then exists for the
Common Stock, adequate information concerning the Company is
then available to the public, and other terms and conditions
of Rule 144 are complied with; and (D) there is now no
registration statement on file with the Securities and
Exchange Commission with respect to any stock of the Company
and the Company has no obligation or current intention to
register any shares acquired pursuant to the exercise of this
option under the Securities Act.
(v) The Optionee agrees that, if the Company offers
any of its Common Stock for sale pursuant to a registration
statement under the Securities Act, the Optionee will not,
without the prior written consent of the Company, offer, sell,
contract to sell or otherwise dispose of, directly or
indirectly (a "Disposition"), any shares purchased upon
exercise of this option for a period of 90 days after the
effective date of such registration statement.
By making payment upon exercise of this option, the Optionee shall be deemed to
have reaffirmed, as of the date of such payment, the representations made in
this Section 12.
(b) Legends on Stock Certificate. All stock certificates
representing shares of Common Stock issued to the Optionee upon exercise of this
option shall have affixed thereto legends substantially in the following forms,
in addition to any other legends required by applicable state law:
"The shares of stock represented by this certificate have not
been registered under the Securities Act of 1933 and may not
be transferred, sold or otherwise disposed of in the absence
of an effective registration statement with respect to the
shares evidenced by this certificate, filed and made effective
under the Securities Act of 1933, or an opinion of counsel
satisfactory to the Company to the effect that registration
under such Act is not required."
"The shares of stock represented by this certificate are
subject to certain
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restrictions on transfer contained in an Option Agreement, a
copy of which will be furnished upon request by the issuer."
13. Miscellaneous.
(a) Except as provided herein, this option may not be amended
or otherwise modified unless evidenced in writing and signed by the Company and
the Optionee.
(b) All notices under this option shall be mailed or delivered
by hand to the parties at their respective addresses set forth beneath their
names below or at such other address as may be designated in writing by either
of the parties to one another.
(c) This option shall be governed by and construed in
accordance with the laws of the State of Delaware.
Date of Grant: BAYCORP HOLDINGS, LTD.
, 2000
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By:
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Name:
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Title:
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OPTIONEE'S ACCEPTANCE
The undersigned hereby accepts the foregoing option and agrees to the
terms and conditions thereof. The undersigned hereby acknowledges receipt of a
copy of the Company's 1996 Stock Option Plan.
OPTIONEE
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Name:
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Address:
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