EXHIBIT 10.8
Warrant Agreement
Warrant Agreement, dated as of ____________ __, 1997 (the "Date of
Grant"), between CGA Group, Ltd. (the "Company"), and _______________ (the
"Optionee"), an employee of the Company. This Warrant Agreement is pursuant to
the terms of the Company's Stock Warrant Plan (the "Plan"). The applicable terms
of the Plan are incorporated herein by reference, including the definition of
terms contained in the Plan.
Section 1. Warrant Award. The Company grants to the Optionee, on the
terms and conditions hereinafter set forth, a Warrant with respect to
________________ shares of the Company's Common Stock (the "Warrant Shares").
The Warrant is intended to qualify as an incentive stock option under Section
422 of the Code.
Section 2. Exercise Price. The exercise price per share of the Warrant
Shares shall be US $5.00 per share.
Section 3. Vesting of Warrant. Subject to Section 6 hereof, the
Warrant Shares shall become vested and exercisable in four equal annual
installments based on the Optionee's continued employment with the Company and
the passage of time according to the following vesting schedule:
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Vesting Date Number of Shares
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1. June __, 1998
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2. June __, 1999
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3. June __, 2000
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4. June __, 2001
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Notwithstanding the foregoing, but subject to Section 6 hereof, all Warrant
Shares shall become (i) fully and immediately vested and exercisable to the
extent provided under Article IX of the Plan upon a "change in control" of the
Company or (ii) vest as provided in Section 8.2 of the Plan, upon the disability
of the Optionee.
Section 4. Limitations of Section 422 of the Code. Pursuant to Section
7.2 of the Plan and Section 422(d) of the Code, to the extent the aggregate fair
market value of stock with respect to which the Warrant (together with any other
incentive stock options of the Company and its subsidiaries) is exercisable, for
the first time by the Optionee during any
calendar year, exceeds $100,000, the portion of the Warrant representing such
excess shall not be treated as an incentive stock option and shall instead be
treated as a nonqualified option.
Section 5. Warrant Term. Warrant Shares that become exercisable
pursuant to Section 3 hereof may be purchased at any time during the Warrant
Term. For purposes hereof, the "Warrant Term" shall commence on the Date of
Grant and shall expire on the day before the tenth anniversary thereof, unless
earlier terminated upon the Optionee's termination from service as an employee
as provided in Section 6 hereof. Upon the expiration of the Warrant Term, any
unexercised Warrant Shares shall be cancelled and shall be of no further force
or effect.
Section 6. Termination of Service. If Optionee's service as an
employee of the Company is terminated for any reason prior to the occurrence of
any otherwise applicable vesting date or event provided in Section 3 hereof, the
Optionee shall (i) forfeit his interest in any Warrant Shares that have not yet
become vested, which shall be cancelled and be of no further force or effect,
and (ii) retain the right to exercise any Warrant Shares that have previously
become vested until the expiration of 30 days after the effective date of such
termination of service or, in the event such termination of service is as a
result of disability or death (as provided in Article VIII of the Plan), until
the expiration of one year after the date of termination; provided, however,
that in the event of termination of service for "cause" (as defined in Section
8.3 of the Plan), the Optionee's right to exercise any unexercised portion of
his Warrant shall immediately terminate and all rights thereunder shall cease.
Section 7. Procedure for Exercise. The Warrant may be exercised, in
whole or part (for the purchase of whole shares only), by delivery of a written
notice (the "Notice") from the Optionee to the Secretary of the Company at the
Company's principal office, which Notice shall: (i) state the number of Warrant
Shares being exercised; (ii) state the method of payment for the Warrant Shares
and tax withholding pursuant to Section 8 hereof; (iii) include any
representation of the Optionee required pursuant to Section 9 hereof; (iv) in
the event that the Warrant shall be exercised by any person other than the
Optionee pursuant to Section 13 hereof, include appropriate proof of the right
of such person to exercise the Warrant; and (v) comply with such further
requirements consistent with the Plan as the Committee may from time to time
prescribe.
Section 8. Payment of Exercise Price and Tax Withholding. Payment of
the Exercise Price for the Warrant Shares shall be made (i) in cash or by
personal or certified
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check or other cash equivalent, (ii) by delivery of stock certificates (in
negotiable form) representing shares of Common Stock having a Fair Market Value
equal to the aggregate Exercise Price of the Warrant Shares or (iii) a
combination of the methods set forth in the foregoing clauses (i) and (ii). If
shares of previously owned Common Stock are used as the medium of payment, the
Fair Market Value of such shares of Common Stock shall be determined as of the
date on which the payment is made. Alternatively, payment of the Exercise Price
shall be deemed satisfied by having the Company withhold a number of shares of
Common Stock otherwise issuable to the Optionee upon exercise of the Warrant,
the Fair Market Value of which equals the Exercise Price; provided, however,
that the shares so withheld shall be considered issued for purposes of Section
5.1 of the Plan. For purposes hereof, the Fair Market Value of the shares of
Common Stock delivered and withheld shall be determined as of the date on which
the Warrant is exercised. In addition and at the time of exercise, as a
condition of delivery of the Warrant Shares, the Optionee shall remit to the
Company all required federal, state and local withholding tax amounts in any
manner permitted for the payment of the exercise price as provided above.
Section 9. Investment Representation. Upon the exercise of the Warrant
at a time when there is not in effect a registration statement under the
Securities Act of 1933 relating to the Warrant Shares, the Optionee hereby
represents and warrants, and by virtue of such exercise shall be deemed to
represent and warrant, to the Company that the Warrant Shares shall be acquired
for investment and not with a view to the distribution thereof, and not with any
present intention of distributing the same, and the Optionee shall provide the
Company with such further representations and warranties as the Company may
require in order to ensure compliance with applicable federal and state
securities, blue sky and other laws. No Warrant Shares shall be purchased upon
the exercise of the Warrant unless and until the Company and/or the Optionee
shall have complied with all applicable federal or state registration, listing
and/or qualification requirements and all other requirements of law or of any
regulatory agencies having jurisdiction, unless the Committee has received
evidence satisfactory to it that a prospective Optionee may acquire such shares
pursuant to an exemption from registration under the applicable securities laws.
Any determination in this connection by the Committee shall be final, binding
and conclusive. The Company reserves the right to legend any certificate for
shares of Common Stock, conditioning sales of such shares upon compliance with
applicable federal and state securities laws and regulations.
Section 10. Shareholders Agreement. Each Optionee that wishes to
exercise a Warrant shall be required, at the
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time of the exercise of the Warrant and prior to receiving certificates
representing the Common Stock with respect to such exercise, unless such
Optionee is already a party thereto, to execute a counterpart signature page,
and thereby become a party, to the Shareholders Agreement among the Company and
the investors named therein dated as of June __, 1997, as the same may be
amended, supplemented or otherwise modified from time to time.
Section 11. No Rights as Stockholder or Employee.
(a) The Optionee shall not have any privileges of a stockholder of the
Company with respect to any Warrant Shares subject to (but not acquired upon
valid exercise of) the Warrant, nor shall the Company have any obligation to
issue any dividends or otherwise afford any rights to which shares of Common
Stock are entitled with respect to any such Warrant Shares, until the date of
the issuance to the Optionee of a stock certificate evidencing such shares.
(b) Nothing in this Warrant Agreement or the Warrant shall confer upon
the Optionee any right to continue as an employee of the Company or to interfere
in any way with the right of the Company to terminate the Optionee's employment
at any time.
Section 12. Adjustments. If at any time while the Warrant is
outstanding, the number of outstanding shares of Common Stock of the Company is
changed by reason of a reorganization, recapitalization, stock split or any of
the other events described in Section 5.2 of the Plan, the number and kind of
Warrant Shares and/or the exercise price of such Warrant Shares shall be
adjusted in accordance with the provisions of Section 5.2 of the Plan.
Section 13. Restriction on Transfer of Warrant. The Warrant may not be
transferred, pledged, assigned, hypothecated or otherwise disposed of in any way
by the Optionee, except by will or by the laws of descent and distribution. In
the event an Optionee becomes legally incapacitated, his Warrant shall be
exercisable by his legal guardian, committee or legal representative. If the
Optionee dies, the Warrant shall thereafter be exercisable by the Optionee's
executors or administrators. The Warrant shall not be subject to execution,
attachment or similar process. Any attempted assignment, transfer, pledge,
hypothecation or other disposition of the Warrant contrary to the provisions
hereof, and the levy of any execution, attachment or similar process upon the
Warrant, shall be null and void and without effect.
Section 14. Notices. Any notice hereunder by the Optionee shall be
given to the Company in writing and such notice shall be deemed duly given only
upon receipt thereof at
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the Company's office at Xxxxxxxxx Xxxxx, Xxxxxx Xxxxxx, Xxxxxxxx XX00 Xxxxxxx,
Attention: The Company's Secretary, or at such other address as the Company may
designate by notice to the Optionee. Any notice hereunder by the Company shall
be given to the Optionee in writing and such notice shall be deemed duly given
only upon receipt thereof at such address as the Optionee may have on file with
the Company.
Section 15. Construction. The construction of this Warrant Agreement
is vested in the Committee, and the Committee's construction shall be final and
conclusive.
Section 16. Governing Law. This Warrant Agreement shall be construed
and enforced in accordance with the laws of the State of New York, without
giving effect to the choice of law principles thereof.
CGA GROUP, LTD.
By: ________________________________
Name:
Title:
OPTIONEE
____________________________________
Name:
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