Exhibit 10.6
XXXXXXXXXXXXXXX.XXX, INC.
1999 EQUITY INCENTIVE PLAN
AWARD AGREEMENT FOR NONSTATUTORY STOCK OPTION
THIS AWARD AGREEMENT (the "Agreement") is made and entered into
effective as of the ____ day of __________________ _____, by and between
xxxxxxxxxxxxxxx.xxx, inc., a Delaware corporation (the "Company"), and
_________________, an Employee, Director or Consultant of the Company or of an
Affiliate (the "Optionholder"), pursuant to the xxxxxxxxxxxxxxx.xxx, inc. 1999
Equity Incentive Plan, as it may be amended and restated from time to time (the
"Plan"). Capitalized terms used but not defined herein shall have the meanings
set forth in the Plan.
W I T N E S S E T H:
WHEREAS, the Optionholder is an Employee, Director or Consultant of the
Company or an Affiliate; and
WHEREAS, the Company has granted, subject to the execution of this
Agreement, and the Optionholder desires to receive, an Award pursuant to the
Plan.
NOW, THEREFORE, for and in consideration of the premises, the mutual
promises and covenants herein contained, and other good and valuable
consideration, the receipt, adequacy and sufficiency of which are hereby
acknowledged, the parties hereto do hereby agree as follows:
1. GRANT OF AWARD. Subject to the execution of this Agreement, the
Company has granted to the Optionholder an Award in the form of the right and
option (the "Option") to purchase from the Company such number of whole
shares of Common Stock of the Company as is set forth on Exhibit A hereto
from the authorized and unissued Common Stock of the Company, or from the
treasury stock of the Company, at and for the Exercise Price set forth on
Exhibit A attached hereto. This Option is intended to be an Nonstatutory
Stock Option under the Plan.
2. HOW OPTIONS MAY BE EXERCISED. The Option shall be exercised by
delivery to the Company at its principal office of written notice of the
Optionholder's intent to exercise the Option with respect to the number of
shares of Common Stock then being purchased, accompanied by payment in full
to the Company of the amount of the Exercise Price for the number of shares
of Common Stock then being purchased. The Exercise Price upon exercise of the
Option shall be payable to the Company (a) in cash or its equivalent, or (b)
if the Board, in its discretion, has approved such consideration prior to the
exercise of the Option, (i) by delivery to the Company of other Common Stock
of the Company, (ii) according to a deferred payment or other arrangement
acceptable to the Board, (iii) pursuant to a Cashless Exercise, (iv) in any
other form of legal consideration that may be acceptable to the Board, or
(v) by a combination of the foregoing forms of consideration; PROVIDED, HOWEVER,
that at any time the Company is incorporated in Delaware, payment of the Common
Stock's par value shall not be made by deferred payment.
3. CONDITIONS FOR EXERCISE OF OPTIONS. The Option may be exercised and
Common Stock may be purchased by the Optionholder as the result of such exercise
only during the term or terms set forth on Exhibit A attached hereto; provided,
however, that in no event shall the total number of shares of Common Stock
purchased hereunder pursuant to the exercise of the Option exceed the number set
forth on Exhibit A attached hereto, as the same may be adjusted in accordance
with the Plan, and in no event shall the period for exercising the Option exceed
ten (10) years from the date of the grant of the Option. Exercise of the Option
is subject to the following additional terms and conditions:
(a) If the Optionholder is not a party to the Stockholders
Agreement then the Optionholder may not, prior to the Effective Date, exercise
the Option unless the Optionholder contemporaneously with the giving of such
notice becomes a party to the Stockholders Agreement.
(b) In the event the Continuous Service of the Optionholder
shall be terminated for any reason other than for death or Disability, the
Option may be exercised at any time after such termination and before the
earlier of (i) three (3) months following the termination of the Optionholder's
Continuous Service and (ii) the expiration date of the Option; PROVIDED,
HOWEVER, that if the Board determines that the exercise of the Option following
the termination of the Optionholder's Continuous Service would be prohibited at
any time solely because the issuance of shares of Common Stock would violate the
registration requirements under the Securities Act, then the Option shall
terminate on the earlier of (i) the expiration date of the Option or (ii) the
passage of an aggregate of one hundred twenty (120) days after the termination
of the Optionholder's Continuous Service during which the exercise of the Option
would not be in violation of such registration requirements.
(c) If the Continuous Service of the Optionholder shall be
terminated by reason of Disability, the Option may be exercised at any time
after such termination and before the earlier of (i) twelve (12) months and (ii)
the expiration date of the Option.
(d) If the Continuous Service of the Optionholder shall be
terminated by reason of the death of the Optionholder, or the Optionholder dies
within the periods specified in subsections 3(b) or (c) above relating to
exercise of the Option following termination of the Optionholder's Continuous
Service for reasons other than death, then the executor or administrator of the
estate of the Optionholder, or other allowable transferee, shall have the right
to exercise the Option at any time after such termination and before the earlier
of (i) eighteen (18) months and (ii) the expiration date of the Option.
(e) Notwithstanding any other provision hereof, in no event
may the Option be exercised at any time after termination of Continuous Service
with respect to any number of shares of Common Stock in excess of the number of
shares of Common Stock as to which the Option was exercisable at the time of
termination of Continuous Service.
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4. ISSUANCE OF CERTIFICATE. In case of any exercise of the Option, this
Agreement, accompanied by payment of the full purchase price for the shares of
Common Stock then being purchased as provided in Paragraph 2 above, shall be
surrendered to the Company. The Company will thereupon cause to be issued and
delivered to the Optionholder as soon as reasonably may be done in accordance
with the terms of the Plan, a certificate or certificates representing the
shares of Common Stock so purchased and fully paid for. In the event of a
partial exercise, the Company will endorse on Exhibit B hereto the fact that the
Option has been partially exercised on such date, setting forth the extent of
such exercise, and return this Agreement to the Optionholder. To the extent the
Option is not exercised, the shares of Common Stock covered hereby shall be
considered released to the Company.
5. RESTRICTIONS ON TRANSFER. The Option may not be transferred either
in whole or in part except as permitted by this Paragraph 5. Any purported
transfer of the Option or any portion thereof in violation of this Paragraph
shall be void and ineffective and shall not operate to transfer any interest in
or title to the Option to the purported transferee and the Company shall not
record any such purported transfer in its transfer records.
(a) Permitted Transfers. Subject to the provisions of this
Paragraph 5, the Optionholder may transfer the Option in whole or in part, but
only to the extent that the Option is exercisable at the time of such transfer.
Prior to the Effective Date, the Option or a portion thereof may be transferred
only (i) by the laws of descent and distribution or (ii) by inter vivos transfer
or by will to one or more of Optionholder's lineal descendants or a trustee of a
trust, custodian or guardian for the exclusive benefit of one or more such
lineal descendants or to the spouse of the Optionholder. After the Effective
Date, the Option or a portion hereof may be transferred to any person.
(b) Method of Transfer. Prior to the transfer of the Option or
any portion thereof, the Optionholder or the representative of the
Optionholder's estate shall deliver to the Company at its principal office this
Agreement and written notice of the Optionholder's desire to transfer the Option
or a portion thereof, which notice shall specify the name and address of each
proposed transferee, the number of shares of Common Stock with respect to which
the Optionholder desires to transfer the right to purchase and the exercise
price with respect to such shares, and, if the Optionholder desires the transfer
to occur prior to the Effective Date, the relationship between the Optionholder
and each proposed transferee. The Optionholder's transfer of the Option or a
portion thereof to a proposed transferee shall become effective upon the
Company's receipt of the proposed transferee's agreement in writing, in form and
substance satisfactory to the Company, that the proposed transferee and the
Option or portion thereof transferred to him shall be bound by the provisions of
the Plan and this Agreement. If less that the whole Option is transferred, the
Company shall, within a reasonable time after the receipt of the last such
agreement from each of the proposed transferees, endorse on Exhibit B hereto the
fact that the Option has been partially transferred and return this Agreement to
the Optionholder.
(c) Securities Law Compliance. Notwithstanding any other
provision of this Paragraph 5, the Option may not be transferred, in whole or in
part, if the Company determines that such transfer would be in violation of
applicable securities laws.
6. SUBJECT TO THE TERMS OF THE PLAN. The Option is in all respects
subject to, and shall be governed and determined by, the provisions of the Plan
(all of the terms of which are incorporated
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herein by reference) and to any rules which might be adopted by the Board or the
Committee with respect thereto to the same extent and with the same effect as if
set forth fully herein.
7. TERMINATION OF OPTION. This Agreement shall terminate no later than
ten (10) years from the date of grant of the Option.
8. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware, applied without giving effect
to any conflict-of-law principles. The invalidity or unenforceability of any
particular provision of this Agreement shall not affect the other provisions
hereof, and this Agreement shall be construed in all respects as if such invalid
or unenforceable provisions were omitted.
9. BINDING EFFECT. This Agreement shall be binding upon and shall inure
to the benefit of each of the parties hereto and their respective executors,
administrators, personal representatives, legal representatives, heirs, and
successors in interest.
10. COUNTERPARTS. This Agreement may be executed in counterparts, each
of which shall be considered an original, and such counterparts shall, together,
constitute and be one and the same instrument.
11. INVESTMENT PURPOSES. Upon request by the Company, the Optionholder
agrees to deliver to the Company at the time of any complete or partial exercise
of this Option a written representation that the shares of Common Stock being
acquired upon such exercise are being acquired for investment and not for resale
or with a view to the distribution thereof. Upon such request, delivery of such
written representation prior to the expiration of the Option period shall be a
condition precedent to the right of the Optionholder or any other persons to
purchase Common Stock hereunder and the Company's obligation to issue Common
Stock hereunder.
12. WITHHOLDING. The Company shall have the power and the right to
deduct or withhold, or require the Optionholder to remit to the Company, an
amount sufficient to satisfy federal, state and local taxes (including the
Optionholder's FICA obligation) required by law to be withheld with respect to
any taxable event arising as a result of the grant or exercise of the Option.
With respect to withholding required upon the exercise of the Option, the
Optionholder may elect, subject to the approval of the Board, to satisfy the
withholding requirement, in whole or in part, (i) by having the Company withhold
shares of Common Stock having a Fair Market Value on the date as of which the
tax is to be determined equal to the minimum statutory total tax which could be
imposed on the transaction, or (ii) delivering to the Company owned and
unencumbered shares of Common Stock having such value. All such elections shall
be irrevocable, made in writing, signed by the Optionholder, and subject to any
restrictions or limitations that the Board, in its sole discretion, deems
appropriate.
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13. NO EFFECT ON EMPLOYMENT. This Agreement shall not be deemed to
confer upon Optionholder any right to continue Optionholder's service to the
Company or its Affiliate, whether as an Employee, Director or Consultant, and
the Company may terminate such service at any time for any reason, subject to
the provisions of any applicable agreement.
IN WITNESS WHEREOF, the Company and the Optionholder have executed and
delivered this Agreement as of the day and year first written above.
XXXXXXXXXXXXXXX.XXX, INC.
By:
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Xxxxxx X. Xxxxx, Xx.
President
OPTIONHOLDER:
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Name:
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EXHIBIT A
TO
AWARD AGREEMENT
Optionholder: __________________________________
Grant Date: __________________________________
Exercise Price: $_________________________________
Can Only Be Must Be
Shares of Common Stock Subject to Option Exercised After Exercised Before
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EXHIBIT B
TO
AWARD AGREEMENT
Pursuant to Paragraphs 4 and 5 hereof, record partial exercise or
transfer below:
PARTIAL EXERCISE
No. of Shares Date of No. of Signature of
Exercised or Transferred Exercise or Transfer Shares Remaining Endorsing Officer
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