EXHIBIT 4.3
AQUA DYNE, INC.
STOCK OPTION AGREEMENT
AQUA DYNE, INC. (the "Company"), desiring to afford an opportunity to
the Grantee named below to purchase certain shares of the Company's Common
Stock, hereby grants to the Grantee, and the Grantee hereby accepts, an option
to purchase the number of such shares specified below, during a term ending at
midnight (prevailing local time at the Company's principal offices) on the
Expiration Date of this Option specified below, at the Option Exercise Price Per
Share specified below, subject to and upon the following terms and conditions:
1. IDENTIFYING PROVISIONS. As used in this Option, the following terms
shall have the following respective meanings:
(a) Grantee:
(b) Date of Grant:
(c) Number of Shares of Common Stock Optioned:
(d) Option Exercise Price Per Share
(e) Expiration Date:
2. NATURE OF THE OPTION. This Option is intended to be a non-statutory
stock option and is not intended to be an incentive stock option within the
meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code"), or to otherwise qualify for any special tax benefits to the Grantee.
3. RESTRICTIONS ON TRANSFERABILITY OF OPTION. This Option may not be
transferred by the Grantee other than by will or the laws of descent and
distribution and may be exercised during the Grantee's lifetime only by the
Grantee or the Grantee's guardian or legal representative. However, it may
during the Grantee's lifetime also be transferred to and may thereafter be
exercised by members of the Grantee's immediate family, or a partnership whose
members include only the Grantee and/or members of the Grantee's immediate
family, or a trust for the benefit of only the Grantee and/or members of the
Grantee's immediate family. As used herein, the Grantee's immediate family
includes only the Grantee's spouse, parents or other ancestors, and children and
other direct descendants of the Grantee or of the Grantee's spouse (including
such ancestors and descendants by adoption).
4. ADJUSTMENTS AND CORPORATE REORGANIZATIONS. If the outstanding shares
of stock of the class then subject to this Option are increased or decreased, or
are changed into or exchanged for a different number or kind of shares or
securities or other forms of property (including cash) or rights, as a result of
one or more reorganizations, recapitalization, spin-offs, stock splits, reverse
stock splits, stock dividends or the like, appropriate adjustments shall be made
in the number and/or kind of shares or securities or other forms of property
(including cash) or rights for which this Option may thereafter be exercised,
all without any change in the aggregate exercise price applicable to the
unexercised portions of this Option, but with a corresponding adjustment in the
exercise price per share or other unit. No fractional share of stock shall be
issued under this Option or in connection with any such adjustment. Such
adjustments shall be
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made by or under authority of the Company's board of directors whose
determinations as to what adjustments shall be made, and the extent thereof,
shall be final, binding and conclusive. In the event the Company is a party to
an agreement by which all outstanding shares of the Company's stock of the class
then subject to this Option are exchanged for shares of stock of another
corporation, the Company shall provide in such agreement that the Grantee shall
receive the options and/or other rights provided for by this Stock Option
Agreement.
Upon the dissolution or liquidation of the Company, this Option shall
terminate, unless provision be made in writing in connection with such
transaction for the assumption of this Option, or the substitution for this
Option of an option covering the stock of a successor corporation, or a parent
or a subsidiary thereof, with appropriate adjustments in accordance with the
provisions hereinabove in this Section entitled "Adjustments and Corporate
Reorganizations" as to the number and kind of shares optioned and their exercise
prices, in which event this Option shall continue in the manner and under the
terms so provided.
If this Option shall terminate pursuant to the next preceding
paragraph, the Grantee or other person then entitled to exercise this Option
shall have the right, at such time prior to the consummation of the transaction
causing such termination as the Company shall designate, to exercise the
unexercised portions of this Option, including the portions thereof which would,
but for this Section entitled "Adjustments and Corporate Reorganizations," not
yet be exercisable.
5. EXERCISE, PAYMENT FOR AND DELIVERY OF STOCK. This Option may be
exercised by the Grantee or other person then entitled to exercise it by giving
four business days' written notice of exercise to the Company specifying the
number of shares to be purchased and the total purchase price, accompanied by a
check to the order of the Company in payment of such total purchase price and
the presentation and surrender of this Option Agreement. If the Company is
required to withhold on account of any federal, state or local tax imposed as a
result of such exercise, the notice of exercise shall also be accompanied by
check to the order of the Company in payment of the amount thus required to be
withheld.
6. NON-CASH EXERCISE. Grantee may at its option elect to pay the
purchase price either with cash as described above or by receiving that number
of shares of common stock (as determined below) that is equal to the value (as
determined below) of this Option, in which event the Company shall issue to the
Grantee the number of shares of common stock determined by using the following
formula:
X = Y (A-B)
-------
A
where X = the number of shares of common stock (or Option Shares) to be issued
to Grantee; Y = the number of Option Shares subject to this Option; A = the Fair
Market Value of one (1) Option Share; B = the Exercise Price per Option Share.
For purposes of the above provision, "Fair Market Value" means
the average of the daily closing prices for fifteen (15) consecutive trading
days commencing immediately before the date of such computation. The closing
price for each day shall be the last reported sales price regular way or in case
no such reported sale takes place on such day, the average of the closing bid
and asked prices regular way for such day, in either case on the principal
national securities
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exchange on which the shares are listed or admitted to trading, of if they are
not listed or admitted to trading on any national securities exchange, but are
traded in the over-the-counter market, the closing sale price of the Common
Stock or, in case no sale is publicly reported, the average of the
representative closing bid and asked quotations for the Common Stock on the
National Association of Securities Dealers Automated Quotation ("NASDAQ") system
or any comparable system, or if the Common Stock is not listed on the NASDAQ
system or any comparable system, the closing price of the Common Stock or, in
case no sale is publicly reported, the average of the closing bid and asked
prices as furnished by two members of the National Association of Securities
Dealers selected from time to time by the Company for that purpose, or if there
are no closing bid and asked prices available, "Fair Market Value" shall be
determined by the Board of Directors appointing a valuation or investment
banking firm of national standing, acceptable to Grantee, who at the Company's
expense shall give their opinion as to what constitutes "Fair Market Value," in
each case as adjusted upon the application of Section 4 hereof.
7. RIGHTS IN STOCK BEFORE ISSUANCE AND DELIVER. No person shall be
entitled to the privileges of stock ownership with respect to any shares
issuable upon exercise of this Option, unless and until such shares have been
issued to such person as fully paid shares.
8. REQUIREMENTS OF LAW. By accepting this Option, the Grantee
represents and agrees for himself or herself and his or her transferees by will
or the laws of descent and distribution that, unless a registration statement
under the Securities Act of 1933 (the "Act") is in effect as to shares purchased
upon any exercise of this Option, (a) any and all shares so purchased shall be
acquired for his or her personal account and not with a view to or for sale in
connection with any distribution, and (b) each notice of the exercise of any
portion of this Option shall be accompanied by a representation and warranty in
writing, signed by the person entitled to exercise the same, that the shares are
being so acquired in good faith for his or her personal account, not with a view
to or for sale in connection with any distribution, and that such person will
not sell or otherwise transfer the shares without delivering to the Company such
documentation requested by the Company, in its sole and absolute discretion
including, but not limited to an opinion of counsel acceptable to the Company,
that shall reasonably satisfy the Company that such transaction will comply with
the registration and requirements of the Act and the registration or
qualification requirements of applicable state securities laws. Grantee agrees
that any certificate for shares of stock issued upon Exercise of this Option may
bear a legend indicating the restriction on transfer set forth herein.
No certificate or certificates for shares of stock purchased
upon exercise of this Option shall be issued and delivered unless and until, in
the opinion of legal counsel for the Company, such securities may be issued and
delivered without causing the Company to be in violation of or incur any
liability under any federal, state or other securities law or any other
requirement of law or of any regulatory body having jurisdiction over the
Company.
9. LOCK-UP AGREEMENT. In the event that the Company contemplates a
secondary or follow-on public offering of its shares and the underwriter
requests that shareholders or option holders including the holder of this Option
or shares issued or issuable in connection with this Option to sign a lock-up
agreement containing restrictions on the sale of such shares, the Grantee agrees
to execute such lock-up agreement on the same terms as other shareholders. The
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Grantee agrees and consents to the entry of stock transfer instructions with the
Company's transfer agent and registrar and a legend placed on certificates for
the shares issued by the Company pursuant to this Option which prohibit the
transfer of the securities held by the Grantee except in compliance with the
terms of this Section 9. For purposes of this Section 9 the term "Grantee"
includes entities to whom Grantee has transferred this Option or the shares
issuable pursuant to the Exercise of this Option.
10. NOTICES. Any notice to be given to the Company shall be addressed
to the Company in care of its Secretary at its principal office, and any notice
to be given to the Grantee shall be addressed to the Grantee at the address set
forth beneath the Grantee's signature hereto or at such other address as the
Grantee may hereafter designate in writing to the Company. Any such notice shall
be deemed duly given when enclosed in a properly sealed envelope or wrapper
addressed as aforesaid, registered or certified, and deposited, postage and
registry or certification fees prepaid, in a post office or branch post office
regularly maintained by the United States Postal Service.
11. RULES OF CONSTRUCTION. This Agreement has been executed and
delivered by the Company in California and shall be construed and enforced in
accordance with the laws of this State, other than any choice of law rules
calling for the application of laws of another jurisdiction
IN WITNESS WHEREOF, the Company has granted this Option on the date of
grant specified above.
AQUA DYNE, INC.
By:
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Its:
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GRANTEE
Address:
Print Name
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CONSENT
The undersigned spouse of Optionee acknowledges that he/she has read
the foregoing Agreement and agrees that his or her interest, if any, in the
Shares subject to the foregoing Agreement shall be irrevocably bound by this
Agreement and further understands and agrees that any community property
interest, if any, shall be similarly bound by this agreement.
Date:
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Spouse of Optionee
Spouse's Name:
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