FORM OF ACACIA RESEARCH CORPORATION
EXHIBIT
10.3
FORM
OF
ACACIA
RESEARCH CORPORATION
2002
ACACIA TECHNOLOGIES STOCK INCENTIVE PLAN
THIS
AGREEMENT is made this _____ day of ______________, by and between
Acacia Research Corporation, a Delaware corporation, and
_________________________, a Participant in the Corporation’s 2002 Acacia
Technologies Stock Incentive Plan (the
“Plan”).
All
capitalized terms in this Agreement shall have the meaning assigned to them
in
this Agreement, in the attached Appendix or, if such term is not defined in
this
Agreement or the Appendix, such term shall have the meaning assigned to it
under
the Plan.
X. XXXXX
OF SHARES
1. Grant. Participant
is hereby granted _____________ shares of Common Stock (the
“Shares”) pursuant to the provisions of the Stock
Issuance Program.
2. Consideration. With
respect to the par value of the Shares, such Shares are granted in consideration
for past services provided by the Participant to the Corporation. The
consideration for the remaining value of the Shares is provided and
for the services Participant shall provide to the Corporation over the vesting
period provided in Paragraph C.2.
3. Other
Documents. Participant shall deliver a duly
executed blank Assignment Separate from Certificate (in the form attached hereto
as Exhibit I) with respect to the Shares.
4. Stockholder
Rights. Until such time as the Unvested Shares are
forfeited pursuant to Paragraph C.1., Participant (or any successor in interest)
shall have all the rights of a stockholder (including voting, dividend and
liquidation rights) with respect to the Shares, subject, however, to the
transfer restrictions of this Agreement.
5. Escrow. The
Corporation shall have the right to hold the Shares in escrow until those shares
have vested in accordance with Paragraph C.2.
6. Compliance
with Law. Under no circumstances shall
shares of Common Stock or other assets be issued or delivered to Participant
pursuant to the provisions of this Agreement unless, in the opinion of
counsel for the Corporation or its successors, there shall have been
compliance with all applicable requirements of applicable securities laws,
all
applicable listing requirements of any stock exchange (or the Nasdaq National
Market, if applicable) on which the Common Stock is at the time listed for
trading and all other requirements of law or of any regulatory bodies having
jurisdiction over such issuance and delivery.
B. TRANSFER
RESTRICTIONS
1. Restriction
on Transfer. Except for any Permitted Transfer,
Participant shall not transfer, assign, encumber or otherwise dispose of any
of
the Shares which are Unvested Shares.
2. Restrictive
Legend. The stock certificate for the
Shares shall be endorsed with the following restrictive legend:
“THE
SHARES REPRESENTED BY THIS CERTIFICATE ARE UNVESTED AND SUBJECT TO FORFEITURE
TO
THE CORPORATION IN CERTAIN CIRCUMSTANCES AND ACCORDINGLY MAY NOT BE SOLD,
ASSIGNED, TRANSFERRED, ENCUMBERED, OR IN ANY MANNER DISPOSED OF EXCEPT IN
CONFORMITY WITH THE TERMS OF A WRITTEN AGREEMENT BETWEEN THE CORPORATION AND
THE
REGISTERED HOLDER OF THE SHARES (OR THE PREDECESSOR IN INTEREST TO THE
SHARES). A COPY OF SUCH AGREEMENT IS MAINTAINED AT THE CORPORATION’S
PRINCIPAL CORPORATE OFFICES.”
3. Transferee
Obligations. Each person (other than the Corporation) to
whom the Shares are transferred by means of a Permitted Transfer must, as a
condition precedent to the validity of such transfer, acknowledge in writing
to
the Corporation that such person is bound by the provisions of this Agreement
and that the transferred shares are subject to the forfeiture provisions to
the
same extent such shares would be so subject if retained by
Participant.
C. FORFEITURE
OF SHARES.
1. Forfeiture
of Shares. On the date Participant ceases for any reason
to remain in Service, all of the Shares in which Participant is not, at the
time
of his or her termination of Service, vested in accordance with Paragraph C.2.
of this Agreement (such shares to be hereinafter referred to as the
“Unvested Shares”) shall be forfeited, shall become the
property of the Corporation and the Participant shall no longer have any right
to or ownership of such Shares. The certificates representing
the forfeited Unvested Shares shall be delivered to the Corporation
as soon as possible after the termination of Service.
2. Termination
of Forfeiture. The forfeiture provided for in this
Paragraph C shall terminate with respect to all Shares and the Unvested Shares
shall be fully vested on _________
3. Recapitalization. Any
new, substituted or additional securities or other property (including cash
paid
other than as a regular cash dividend) which is by reason of any
Recapitalization distributed with respect to the Shares shall be immediately
subject to forfeiture pursuant to this Paragraph C and any escrow requirements
hereunder, but only to the extent the Shares are at the time covered by such
forfeiture or escrow requirements. Appropriate adjustments to reflect
such distribution shall be made to the number, kind, type and/or class of
securities subject to this Agreement in order to reflect the effect of any
such
Recapitalization upon the Corporation’s capital structure.
4. Change
in Control./Hostile Take-Over. All of the Shares shall become fully
vested and any Forfeiture Provision shall terminate in full, immediately prior
to and contingent upon a Change in Control or Hostile Take-Over.
D. TAX
PROVISIONS.
1. Tax
Consequences. Participant has reviewed with
Participant’s own tax advisors the federal, state, local and foreign tax
consequences of this investment and the transactions contemplated by this
Agreement. Participant is relying solely on such advisors and not on
any statements or representations of the Corporation or any of its
agents. Participant understands that Participant (and not the
Corporation) shall be responsible for any tax liability that may arise as a
result of the transactions contemplated by this
Agreement. Participant understands that Section 83 of the Code,
taxes as ordinary income the difference between the purchase price for the
Shares and the Fair Market Value of the Shares as of the date any restrictions
on the Shares lapse. In this context, “restriction” includes
forfeiture provision pursuant to Paragraph C.1. with respect to the Unvested
Shares. Participant understands that Participant may elect to be
taxed at the time the Shares are granted rather than when and as the forfeiture
provision lapses by filing an election under Section 83(b) of the Code with
the IRS within thirty (30) days from the date of grant. Participant
acknowledges that it is Participant’s sole responsibility, and not the
Corporation’s, to file a timely election under code section 83(b), even if
Participant requests the Corporation or its representatives to make this filing
on his or her behalf.
2. Withholding
Obligations. At the time the Shares subject to this
Agreement are granted, or at any time thereafter as requested by the
Corporation, Participant hereby authorizes withholding from payroll and any
other amounts payable to Participant, including these Shares, and otherwise
agrees to make adequate provision for, any sums required to satisfy the federal,
state, local and foreign tax withholding obligations of the Corporation or
any
Parent or Subsidiary, if any, which arise in connection with the grant of the
Shares.
The
Corporation, in its sole discretion, and in compliance with any applicable
legal
conditions or restrictions, may withhold from fully vested Shares otherwise
deliverable to Participant upon the vesting of the Unvested Shares a number
of
whole Shares having a Fair Market Value, as determined by the Corporation as
of
the date of vesting, not in excess of the amount of tax required to be withheld
by law (or such lower amount as may be necessary to avoid adverse financial
accounting treatment). Any adverse consequences to Participant
arising in connection with such share withholding procedure shall be the
Participant’s sole responsibility.
Unless
the tax withholding obligations of the Corporation or any Parent or Subsidiary
are satisfied, the Corporation shall have no obligation to issue a certificate
for such Shares or release such Shares from any escrow provided for
herein.
E. GENERAL
PROVISIONS
1. Assignment. The
Corporation may assign its rights under this Agreement, including, but not
limited to the forfeiture provision of Paragraph C.1., to any person or entity
selected by the Board, including (without limitation) one or more stockholders
of the Corporation.
2. Employment
At Will . Nothing in this Agreement or in the Plan shall
confer upon Participant 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
Participant) or of Participant, which rights are hereby expressly reserved
by
each, to terminate Participant’s Service at any time for any reason, with or
without cause.
3. Notices. Any
notice required to be given under this Agreement shall be in writing and shall
be deemed effective upon personal delivery or upon deposit in the U.S. mail,
registered or certified, postage prepaid and properly addressed to the party
entitled to such notice at the address indicated below such party’s signature
line on this Agreement or at such other address as such party may designate
by
ten (10) days advance written notice under this paragraph to all other parties
to this Agreement.
4. No
Waiver. The failure of the Corporation in any instance
to enforce the forfeiture provision or any other term of this Agreement shall
not constitute a waiver of any other forfeiture provision or other term that
may
subsequently arise under the provisions of this Agreement or any other agreement
between the Corporation and Participant. No waiver of any breach or
condition of this Agreement shall be deemed to be a waiver of any other or
subsequent breach or condition, whether of like or different
nature.
5. Cancellation
of Shares. If the Shares subject to this Agreement are
forfeited, then from and after such time, the person from whom such Shares
are
forfeited shall no longer have any rights as a holder of such
Shares. Such shares shall be deemed forfeited in accordance with the
applicable provisions hereof, and the Corporation shall be deemed the owner
and
holder of such shares, whether or not the certificates therefor have been
delivered as required by this Agreement.
6. Participant
Undertaking. Participant hereby agrees to take whatever
additional action and execute whatever additional documents the Corporation
may
deem necessary or advisable in order to carry out or effect one or more of
the
obligations or restrictions imposed on either Participant or the Shares pursuant
to the provisions of this Agreement.
7. Agreement
is Entire Contract. This Agreement constitutes the
entire contract between the parties hereto with regard to the subject matter
hereof. This Agreement is made pursuant to the provisions of the Plan
and shall in all respects be construed in conformity with the terms of the
Plan. In the event of a conflict between the Plan and this Agreement,
the terms of the Plan shall govern.
8. Governing
Law. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of California without
regard to the conflict-of-laws rules thereof or of any
other jurisdiction.
9. Counterparts. This
Agreement may be executed in counterparts, each of which shall be deemed to
be
an original, but all of which together shall constitute one and the same
instrument.
10. Successors
and Assigns. The provisions of this Agreement shall
inure to the benefit of, and be binding upon, the Corporation and its successors
and assigns and upon Participant, Participant’s assigns and the legal
representatives, heirs and legatees of Participant’s estate, whether or not any
such person shall have become a party to this Agreement and have agreed in
writing to join herein and be bound by the terms hereof.
11. Representations.
Participant
agrees upon request to execute any further documents or instruments necessary
or
desirable in the sole determination of the Corporation to carry out the purposes
or intent of this Agreement.
Participant
acknowledges and agrees that Participant has reviewed the Agreement in its
entirety, has had an opportunity to obtain the advice of counsel prior to
executing and accepting the award and fully understands all provisions of the
Agreement.
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of page is intentionally blank]
IN
WITNESS WHEREOF, the parties have executed this Agreement on the day
and year first indicated above.
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ACACIA
RESEARCH CORPORATION
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By:_____________________________________
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Title:____________________________________
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Address:_________________________________
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________________________________________
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PARTICIPANT
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________________________________________
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Signature
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Address:_________________________________
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________________________________________
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SPOUSAL
ACKNOWLEDGMENT
The
undersigned spouse of the Participant has read and hereby approves the foregoing
Stock Issuance Agreement. In consideration of the Corporation’s
granting the Participant the right to acquire the Shares in accordance with
the
terms of such Agreement, the undersigned hereby agrees to be irrevocably bound
by all the terms of such Agreement, including (without limitation) the
forfeiture to the Corporation (or its assigns) any Shares in which the
Participant is not vested at the time of his or her termination of
Service.
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________________________________________
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PARTICIPANT’S
SPOUSE
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Address:_________________________________
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________________________________________
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EXHIBIT
I
ASSIGNMENT
SEPARATE FROM CERTIFICATE
FOR
VALUE
RECEIVED _______________________ hereby sell(s), assign(s) and transfer(s)
unto
Acacia Research Corporation (the “Corporation”),
_____________________ (________) shares of the Common Stock of the Corporation
standing in his or her name on the books of the Corporation represented by
Certificate No. ______________ herewith and do(es) hereby irrevocably constitute
and appoint ______________________________ Attorney to transfer the said stock
on the books of the Corporation with full power of substitution in the
premises.
Dated: _________________,
_____.
| Signature ____________________________ |
Instruction: Please
do not fill in any blanks other than the signature line. Please sign
exactly as you would like your name to appear on the issued stock
certificate. The purpose of this assignment is to enable the
Corporation to enforce the forfeiture provision without requiring additional
signatures on the part of Participant.
APPENDIX
The
following definitions shall be in effect under the Agreement:
A. Agreement
shall mean this Stock Issuance Agreement.
B. Owner
shall mean Participant and all subsequent holders of the Shares who derive
their
chain of ownership through a Permitted Transfer from Participant.
C. Participant
shall mean the person to whom the Shares are issued under the Stock Issuance
Program.
D. Permitted
Transfer shall mean (i) a gratuitous transfer of the Shares,
provided and only if Participant obtains the Corporation’s prior written
consent to such transfer, (ii) a transfer of title to the Shares effected
pursuant to Participant’s will or the laws of inheritance following
Participant’s death or (iii) a transfer to the Corporation in pledge as security
for any purchase-money indebtedness incurred by Participant in connection with
the acquisition of the Shares.
E. Plan
shall mean the Corporation’s 2002 Acacia Technologies Stock Incentive
Plan.
F. Shares
shall have the meaning assigned to such term in Paragraph A.1.
G. Recapitalization
shall mean any stock split, stock dividend, recapitalization, combination of
shares, exchange of shares or other change affecting the Corporation’s
outstanding Common Stock as a class without the Corporation’s receipt of
consideration.
H. Service
shall mean the Participant’s performance of services for the Corporation (or any
Parent or Subsidiary) in the capacity of an employee, 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, a non-employee member of the board of
directors or an independent consultant. Service shall not be deemed to cease
during a period of military leave, sick leave or other personal leave approved
by the Corporation; provided, however, that except to the extent
otherwise required by law, no Service credit shall be given for purposes of
the
vesting of the Unvested Shares hereunder for any period the Participant is
on a
leave of absence.
I. Stock
Issuance Program shall mean the Stock Issuance Program under the
Plan.
J. Unvested
Shares shall have the meaning assigned to such term in
Paragraph C.1.
A-1
