EUGENE SCIENCE, INC. STOCK OPTION AGREEMENT UNDER
EXHIBIT
10.2
XXXXXX
SCIENCE, INC.
UNDER
2006
STOCK INCENTIVE PLAN
Type
of Option (check one): o
Incentive o
Nonqualified
This
Stock Option Agreement (the “Agreement”)
is
entered into as of __________, _____, by and between XXXXXX SCIENCE, INC.,
a
Delaware corporation (the “Company”),
and
_______________ (“Optionee”)
pursuant to the Company’s 2006 Stock Incentive Plan (the “Plan”). Any
capitalized term not defined herein shall have the meaning ascribed to it in
the
Plan.
1. Grant
of Option.
The
Company hereby grants to Optionee an option (the “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 be immediately vested as to 100% of the
Shares.
3. Term
of Option.
Optionee’s right to exercise this Option shall terminate upon the expiration of
ten (10) years from the date of this Agreement.
4. Exercise
of Option.
On or
after the vesting of any portion of this Option in accordance with Sections
2 or
9 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 and states the number of
Shares then being purchased (but no fractional Shares may be purchased) unless
the Company has established other procedures;
(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 14.5 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.
5. Death
of Optionee; No Assignment.
The
rights of the Optionee under this 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. Representations
and Warranties of Optionee.
Optionee acknowledges receipt of a copy of the Plan and understands that all
rights and obligations connected with this Option are set forth in this
Agreement and in the Plan.
7. Limitation
on Company’s Liability for Nonissuance.
The
Company agrees to use its reasonable best efforts to obtain from any applicable
regulatory agency such authority or approval as may be required in order to
issue and sell the Shares to the Optionee pursuant to this Option. Inability
of
the Company to obtain, from any such regulatory agency, authority or approval
deemed by the Company’s counsel to be necessary for the lawful issuance and sale
of the Shares 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 or approval shall not have been obtained.
8. Adjustments
Upon Changes in Capital Structure.
In the
event that the 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 4.3 of the Plan.
9. Change
in Control.
In the
event of a Change in Control of the Company (as defined in 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.
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(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) 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 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.
(c) 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. However,
in
the event of an Involuntary Termination (as defined below) of Optionee’s
Continuous Service within twelve (12) months following such Change in Control,
then vesting of this Option, the new option or the New Incentives shall
accelerate in full automatically effective upon such Involuntary
Termination.
(d) For
purposes of this Section 11, the following terms shall have the meanings set
forth below:
(i) “Involuntary
Termination”
shall
mean the termination of Optionee’s Continuous Service by reason of:
(A) Optionee’s
involuntary dismissal or discharge by the Company, or by the acquiring or
successor entity (or parent or any subsidiary thereof employing the Optionee)
for reasons other than Cause (as defined below), or
(B) Optionee’s
voluntary resignation following (x) a change in Optionee’s position with the
Company, the acquiring or successor entity (or parent or any subsidiary thereof)
which materially reduces Optionee’s duties and responsibilities or the level of
management to which Optionee reports, (y) a reduction in Optionee’s level of
compensation (including base salary, fringe benefits and target bonus under
any
performance based bonus or incentive programs) by more than ten percent (10%),
or (z) a relocation of Optionee’s principal place of employment by more than
thirty (30) miles, provided and only if such change, reduction or relocation
is
effected without Optionee’s written consent.
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(ii) “Cause”
shall
mean (A) the commission of any act of fraud, embezzlement or dishonesty by
Optionee which materially and adversely affects the business of the Company,
the
acquiring or successor entity (or parent or any subsidiary thereof), (B) any
unauthorized use or disclosure by Optionee of confidential information or trade
secrets of the Company, the acquiring or successor entity (or parent or any
subsidiary thereof), (C) the continued refusal or omission by the Optionee
to
perform any material duties required of him if such duties are consistent with
duties customary for the position held with the Company, the acquiring or
successor entity (or parent or any subsidiary thereof), (D) any material act
or
omission by the Optionee involving malfeasance or gross negligence in the
performance of Optionee’s duties to, or material deviation from any of the
policies or directives of, the Company or the acquiring or successor entity
(or
parent or any subsidiary thereof), (E) conduct on the part of Optionee which
constitutes the breach of any statutory or common law duty of loyalty to the
Company, the acquiring or successor entity (or parent or any subsidiary
thereof), (F) the maintenance of any proceeding initiated by or against Optionee
under any bankruptcy or debtors’ relief laws of the United States or of any
other jurisdiction, which proceeding is not terminated within ninety (90) days
after its commencement, or (G) any illegal act by Optionee which materially
and
adversely affects the business of the Company, the acquiring or successor entity
(or parent or any subsidiary thereof), or any felony committed by Optionee,
as
evidenced by conviction thereof. The provisions of this Section shall not limit
the grounds for the dismissal or discharge of Optionee or any other individual
in the service of the Company, the acquiring or successor entity (or parent
or
any subsidiary thereof).
10. No
Employment Contract Created.
Neither
the granting of this Option nor the exercise hereof shall be construed as
granting to the Optionee any right with respect to continuance of employment
by,
or other service provider relationship with, 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.
11. Rights
as Shareholder.
The
Optionee (or transferee of this option by will or by the laws of descent and
distribution) shall have no rights as a shareholder with respect to any Shares
covered by this Option until the date of the issuance of a stock certificate
or
certificates to him or her for such Shares, notwithstanding the exercise of
this
Option.
12. “Market
Stand-Off” Agreement.
Optionee agrees that, if requested by the Company or the managing underwriter
of
any proposed public offering of the Company’s securities (including any
acquisition transaction where Company securities will be used as all or part
of
the purchase price), 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.
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13. Interpretation.
This
Option is granted pursuant to the terms of the 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.
14. Notices.
Any
notice, demand or request required or permitted to be 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, 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. Applicable
Law.
This
Agreement shall be construed in accordance with the laws of the State of
California without reference to choice of law principles, as to all matters,
including, but not limited to, matters of validity, construction, effect or
performance.
16. Severability.
Should
any provision or portion of this Agreement be held to be unenforceable or
invalid for any reason, the remaining provisions and portions of this Agreement
shall be unaffected by such holding.
17. Counterparts.
This
Agreement may be executed in two or more counterparts, each of which shall
be
deemed an original and all of which together shall be deemed one
instrument.
[Signature
Page Follows]
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IN
WITNESS WHEREOF, the parties have executed this Agreement as of the date first
above written.
|
XXXXXX
SCIENCE, INC.
|
“OPTIONEE”
|
|
By:
_______________________________________
|
_______________________________________
(Signature)
|
|
Its:
_______________________________________
|
_______________________________________
(Type
or Print Name)
|
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