Exhibit 5.3
VERTEL CORPORATION
STOCK OPTION AGREEMENT
(2001 Nonqualified Stock Option Plan)
1. Grant of Option.
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Vertel Corporation, a California corporation (the "Company"), hereby grants
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to the Optionee named in the Notice of Stock Option Grant attached to this
Agreement ("Optionee"), a nonqualified stock option (the "Option") to purchase
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the total number of shares of Common Stock (the "Shares") set forth in the
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Notice of Stock Option Grant, at the exercise price per share set forth in the
Notice of Stock Option Grant (the "Exercise Price") subject to the terms,
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definitions and provisions of the 2001 Nonqualified Stock Option Plan (the
"Plan") adopted by the Company, which is incorporated in this Agreement by
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reference. In the event of a conflict between the terms of the Plan and the
terms of this Agreement, the terms of the Plan shall govern. Unless otherwise
defined in this Agreement, the terms used in this Agreement shall have the
meanings defined in the Plan.
2. Exercise of Option.
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This Option shall be exercisable during its term in accordance with the
Vesting Schedule set out in the Notice of Stock Option Grant and with the
provisions of Sections 8 and 9 of the Plan as follows:
(a) Right to Exercise.
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(i) This Option may not be exercised for a fraction of a share.
(ii) In the event of Optionee's death, disability or other
termination of employment or services, the exercisability of the Option is
governed by Sections 6, 7 and 8 below, subject to the limitations contained in
paragraph (iii) below.
(iii) In no event may this Option be exercised after the date of
expiration of the term of this Option as set forth in the Notice of Stock Option
Grant.
(b) Method of Exercise.
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(i) This Option shall be exercisable by delivering to the Company a
written notice of exercise (in the form attached as Exhibit A) which shall state
the election to exercise the Option, the number of Shares in respect of which
the Option is being exercised, and such other representations and agreements as
to the holder's investment intent with respect to such Shares of Common Stock as
may be required by the Company pursuant to the provisions of the Plan. Such
written notice shall be signed by Optionee and shall be delivered in person or
by certified mail to the Secretary of the Company. The written notice shall be
accompanied by payment of the Exercise Price. This Option shall be deemed to be
exercised upon receipt by the Company of such written notice accompanied by the
Exercise Price.
(ii) As a condition to the exercise of this Option, Optionee agrees
to make adequate provision for federal, state or other tax withholding
obligations, if any, which arise upon the exercise of the Option or disposition
of Shares, whether by withholding, direct payment to the Company, or otherwise.
(iii) No Shares will be issued pursuant to the exercise of an Option
unless such issuance and such exercise shall comply with all relevant provisions
of law and the requirements of any stock exchange upon which the Shares may then
be listed. Assuming such compliance, for income tax purposes the Shares shall
be considered transferred to Optionee on the date on which the Option is
exercised with respect to such Shares.
3. Optionee's Representations.
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In the event the Shares purchasable pursuant to the exercise of this Option
have not been registered under the Securities Act of 1933, as amended (the
"Securities Act"), at the time this Option is exercised, Optionee shall, if
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required by the Company, concurrently with the exercise of all or any portion of
this Option, deliver to the Company an investment representation statement in
customary form, a copy of which is available for Optionee's review from the
Company upon request.
4. Method of Payment.
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Payment of the Exercise Price shall be by any of the following, or a
combination of the following, at the election of Optionee: (a) cash; (b) check;
(c) surrender of other Shares of Common Stock of the Company that (i) either
have been owned by Optionee for more than six (6) months on the date of
surrender or were not acquired, directly or indirectly, from the Company, and
(ii) have a Fair Market Value on the date of surrender equal to the aggregate
exercise price of the Shares as to which said Option shall be exercised; or (d)
if there is a public market for the Shares and they are registered under the
Securities Act, delivery of a properly executed exercise notice together with
irrevocable instructions to a broker to deliver promptly to the Company the
amount of sale or loan proceeds required to pay the exercise price.
5. Restrictions on Exercise.
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This Option may not be exercised if the issuance of such Shares upon such
exercise or the method of payment of consideration for such shares would
constitute a violation of any applicable federal or state securities or other
law or regulation, including any rule under Part 207 of Title 12 of the Code of
Federal Regulations ("Regulation G") as promulgated by the Federal Reserve
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Board. As a condition to the exercise of this Option, the Company may require
Optionee to make any representation and warranty to the Company as may be
required by any applicable law or regulation.
6. Termination of Relationship.
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In the event of termination of Optionee's Continuous Status as an Employee
or Consultant, Optionee may, to the extent otherwise so entitled at the date of
such termination (the
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"Termination Date"), exercise this Option during the Termination Period set out
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in the Notice of Stock Option Grant. To the extent that Optionee was not
entitled to exercise this Option at the date of such termination, or if Optionee
does not exercise this Option within the time specified in the Notice of Stock
Option Grant, the Option shall terminate.
7. Disability of Optionee.
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Notwithstanding the provisions of Section 6 above, in the event of
termination of Optionee's Continuous Status as an Employee or Consultant as a
result of total and permanent disability (as defined in Section 22(e)(3) of the
Code), Optionee may, but only within six (6) months from the date of termination
of employment (but in no event later than the date of expiration of the term of
this Option as set forth in Section 10 below), exercise the Option to the extent
otherwise so entitled at the date of such termination. To the extent that
Optionee was not entitled to exercise the Option at the date of termination, or
if Optionee does not exercise such Option (to the extent otherwise so entitled)
within the time specified in this Agreement, the Option shall terminate.
8. Death of Optionee.
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In the event of the death of Optionee:
(a) during the term of this Option and while an Employee or Consultant and
having been in Continuous Status as an Employee or Consultant since the date of
grant of the Option, the Option may be exercised, at any time within six (6)
months following the date of death (but in no event later than the date of
expiration of the term of this Option as set forth in Section 10 below), by
Optionee's estate or by a person who acquired the right to exercise the Option
by bequest or inheritance, but only to the extent of the right to exercise that
would have accrued had Optionee continued living and remained in Continuous
Status as an Employee or Consultant three (3) months after the date of death; or
(b) within thirty (30) days after the termination of Optionee's Continuous
Status as an Employee or Consultant, the Option may be exercised, at any time
within six (6) months following the date of death (but in no event later than
the date of expiration of the term of this Option as set forth in Section 10
below), by Optionee's estate or by a person who acquired the right to exercise
the Option by bequest or inheritance, but only to the extent of the right to
exercise that had accrued at the date of termination.
9. Non-Transferability of Option.
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Unless the administrator of the Plan determines otherwise, this Option may
not be transferred in any manner otherwise than by will or by the laws of
descent or distribution. The designation of a beneficiary does not constitute a
transfer. An Option may be exercised during the lifetime of Optionee only by
Optionee or a transferee permitted by this section. The terms of this Option
shall be binding upon the executors, administrators, heirs, successors and
assigns of Optionee.
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10. Term of Option.
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This Option may be exercised only within the term set out in the Notice of
Stock Option Grant, and may be exercised during such term only in accordance
with the Plan and the terms of this Option.
11. No Additional Employment Rights.
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Optionee understands and agrees that the vesting of Shares pursuant to the
Vesting Schedule is earned only by continuing as an Employee or Consultant at
the will of the Company (not through the act of being hired, being granted this
Option or acquiring Shares under this Agreement). Optionee further acknowledges
and agrees that nothing in this Agreement, nor in the Plan which is incorporated
in this Agreement by reference, shall confer upon Optionee any right with
respect to continuation as an Employee or Consultant with the Company, nor shall
it interfere in any way with his or her right or the Company's right to
terminate his or her employment or consulting relationship at any time, with or
without cause.
12. Tax Consequences.
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Optionee acknowledges that he or she has read the brief summary set
forth below of certain federal tax consequences of exercise of this Option and
disposition of the Shares under the law in effect as of the date of grant.
OPTIONEE UNDERSTANDS THAT THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX
LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. OPTIONEE SHOULD CONSULT HIS OR HER
OWN TAX ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.
12.1 Exercise of Nonqualified Stock Option.
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Optionee may incur regular federal income tax liability upon the
exercise of the Option. Optionee will be treated as having received
compensation income (taxable at ordinary income tax rates) equal to the excess,
if any, of the fair market value of the Shares on the date of exercise over the
Exercise Price. In addition, if Optionee is an employee of the Company, the
Company will be required to withhold from Optionee's compensation or collect
from Optionee and pay to the applicable taxing authorities an amount equal to a
percentage of this compensation income at the time of exercise.
12.2 Disposition of Shares.
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Any gain realized on the disposition of Shares will be treated as
long-term or short-term capital gain depending on whether or not the disposition
occurs more than one year after the exercise date. Currently, the maximum
marginal tax rate is 20% for long-term capital gains (for sales of shares held
more than one year from the date of exercise of the Option) and 39.6% for short-
term capital gains (for sales of shares held one year or less from the date of
exercise).
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13. Signature.
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This Stock Option Agreement shall be deemed executed by the Company and
Optionee upon execution by such parties of the Notice of Stock Option Grant
attached to this Stock Option Agreement.
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