Exhibit 4.2.1
Employee No.___________
Buy-Sell Agreement
This Agreement is entered into as of _____________, between DiCon
Fiberoptics, Inc. ("Company") and the undersigned person ("Shareholder"), with
respect to all of the shares in the Company now or hereafter owned by
Shareholder ("Shares").
1. Restrictions on Transfers
1.1 No Transfer without Adhering to Agreement. None of the Shares or any
right or interest in the Shares shall be sold, pledged, hypothecated,
encumbered, transferred or disposed of in any way, whether voluntarily or
involuntarily or by operation of law, except under the terms of this Agreement.
1.2 Legend on Share Certificates. Each certificate for Shares shall have
conspicuously endorsed on it the following words:
"Sale, pledge, hypothecation, encumbrance, transfer or disposition of
the shares represented by this certificate is restricted by the
provisions of a Buy-Sell Agreement between Shareholder and DiCon
Fiberoptics, Inc. All provisions of the Buy-Sell Agreement are
incorporated by reference in this certificate. A copy of the Buy-Sell
Agreement may be inspected at the principal office of DiCon Fiberoptics,
Inc."
2. Restrictions on Voluntary Transfers
2.1 No Transfer without Adhering to Article 2. Shareholder shall
not sell, pledge, hypothecate, encumber, transfer or dispose of in any way
("Transfer") any of the Shares or any right or interest in the Shares, except in
compliance with the requirements of this Article 2.
2.2 Option to Purchase. If Shareholder desires to Transfer any
or all of the Shares to any third party, Shareholder shall first have delivered
written notice to the Company expressing Shareholder's desire to Transfer the
Shares. The notice shall specify the number of Shares proposed to be
Transferred, and the name and address of Shareholder's proposed transferee.
During the 60 day period following receipt of notice by the Company from
Shareholder, the Company or its designee shall have the option to purchase any
or all of the Shares proposed to be transferred at the price determined as
provided in Article 5. If the
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Company or its designee exercises its option, the Company or its designee shall
give written notice of that fact to Shareholder.
2.3 Transfer to Proposed Transferee. Any Shares not purchased by
the Company or its designee as prescribed under this Article 2 may be
Transferred to the proposed transferee at any time within 60 days after
expiration of the 60 day period specified in Paragraph 2.2, but only at the
price specified in Article 5. No Transfer shall be made after the end of the 60
day period specified in this Paragraph 2.3, nor shall any change in the terms of
Transfer be permitted without a new notice of intention to Transfer and
compliance with the requirements of this Article 2. Any Transfer by Shareholder
in violation of this Agreement shall be null and void and of no effect.
3. Obligations of Transferees
Each transferee and each subsequent transferee of any Shares or any
right or interest in any Shares shall hold the Shares or right or interest in
the Shares subject to all the provisions of this Agreement and shall make no
further Transfers except as provided in this Agreement. Transfer of the Shares
shall not be entered on the books of the Company until a copy of this Agreement
has been executed by the prospective transferee. Failure or refusal to sign a
copy of this Agreement shall not relieve any transferee from any obligations
under this Agreement.
4. Company Option to Purchase on Triggering Events
4.1 Option to Purchase. Upon the occurrence of any of the following
events ("Triggering Events") with respect to Shareholder or any Shares or any
right or interest in any Shares, the Company or its designee shall have the
option to purchase any or all of the Shares in accordance with the procedures
set forth in Paragraph 4.2:
(a) Filing of a petition in bankruptcy by Shareholder or by any
person against Shareholder.
(b) Assignment of Shareholder's assets for the benefit of
creditors or an appointment of a receiver to take possession of any Shares.
(c) Pledging, hypothecating or otherwise encumbering any Shares
as security for any debt.
(d) Any marital property settlement purporting to give the
spouse of Shareholder any legal or beneficial interest in any Shares.
(e) The entry of any final order, decree or judgment of court in
a marital dissolution or any other proceeding purporting to give the spouse of
Shareholder any legal or beneficial
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interest in any Shares.
(f) The death of Shareholder.
(g) Any attempted Transfer of any Shares not specifically
permitted by other provisions of this Agreement.
(h) The termination for any reason of Shareholder's employment
with the Company.
4.2 Purchase Procedures. During the 60 day period following the date of
actual notice to the Company of a Triggering Event, the Company or its designee
shall have the option to purchase any or all of the Shares at the price
determined as provided in Article 5. If the Company or its designee exercises
its option, the Company or its designee shall give written notice of that fact
to Shareholder.
5. Valuation
5.1 Regular Valuations. The Board of Directors of the Company values the
shares of the Company two times per year at approximately six month intervals;
the first valuation is conducted after the completion of accounting for the
Company's last fiscal year, and the second valuation is conducted after the
completion of accounting for Company operations for the six month period
following the last fiscal year (the first valuation and the second valuation
hereinafter referred to generally as "Regular Valuations").
5.2 Calculation of Current Value of the Shares. The purchase price of
Shares pursuant to Articles 2 and 4 shall be the current value of the shares of
the Company as of the applicable valuation dates specified in subparagraphs (a)
and (b) below ("the Current Value").
(a) Valuation Date for Proposed Voluntary Transfers. The
valuation date in determining the Current Value of Shares pursuant to Article 2
shall be the day Shareholder has delivered written notice to the Company
expressing Shareholder's desire to Transfer Shares as specified in Paragraph
2.2.
(b) Valuation Date for Affected Stock. The valuation date in
determining the Current Value of Shares pursuant to Article 4 shall be the day
of the occurrence of any Triggering Event.
5.3 Valuation Methodology; Valuations in Addition to Regular Valuations.
Regular Valuations shall be done in accordance with a method approved from time
to time by the Board of Directors of the Company within its sole discretion, and
detailed in a document entitled "Evaluating DiCon Common, Methodology", and made
available to Shareholder. However, Shareholder acknowledges that valuation of
the Company's shares is not an exact
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science and therefore, notwithstanding anything herein to the contrary,
Shareholder agrees that the Board of Directors may in its sole discretion amend
Evaluating DiCon Common, Methodology as it deems appropriate, including without
limitation, changing or deleting valuation methods, formulas, rates or
variables, or attaching more or less emphasis to some methods or factors over
others to reflect changing economic conditions and circumstances. In addition to
the Regular Valuations, the Board of Directors may value the shares at such
other times as it determines within its sole discretion, or may devise and apply
such other means to calculate or interpolate the value of the shares at any
particular time between Regular Valuations.
6. Appointment of Company Secretary to Hold Certificates and as Attorney-in-Fact
For convenience in implementing the terms of this Agreement, Shareholder
hereby appoints the Secretary of the Company (i) as custodian to hold the Share
certificates; and (ii) as Shareholder's attorney-in-fact on Shareholder's behalf
for purposes of effectuating the provisions of this Agreement. Immediately upon
receipt, Shareholder shall deposit with the Secretary all certificates
representing the Shares, endorsed in blank.
7. Term of Agreement
The restrictions on Transfer of the Shares set forth in this Agreement
shall terminate upon any of the following:
7.1 Determination of Board. The determination of the Board of Directors
of the Company that this Agreement shall be terminated.
7.2 Public Offering. The consummation of a public offering for any of
the common stock of the Company registered under the Securities Act of 1933, as
amended, on XXX Xxxx X-0 or any successor form.
8. General Provisions
8.1 Notices. Any communications between the parties hereto to be given
in writing shall be given by mailing the same, postage prepaid, or by telex,
cable, facsimile or personal delivery addressed, in the case of the Company, to
the principal office of the Company, and in the case of Shareholder, to
Shareholder's latest address on record with the Company.
8.2 Successors. This Agreement shall inure to the benefit of the
successors, assigns and designees of the Company, and is binding upon the heirs,
successors, assigns, administrators, executors and other legal representatives
of Shareholder.
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8.3 Governing Law. This Agreement shall be governed by and construed
under the laws of the State of the California without regard to California
conflict of law principles.
DiCon Fiberoptics, Inc.
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(Signature of Shareholder)
By
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Ho-Xxxxx Xxx (Print name of Shareholder)
Title: President
By
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Xxxxxxx X. Xxxxxx
Title: Secretary
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Spouses Consent
I am the spouse of _____________________ who has signed the foregoing
Buy-Sell Agreement. I have read the Buy-Sell Agreement and consent to all
provisions of the Buy-Sell Agreement. I agree to take no action to delay or
hinder any transfer of the Shares in accordance with the Buy-Sell Agreement. I
agree that any community property rights and any other right or interest I may
have in the Shares shall be subject and subordinate to the requirements of the
Buy-Sell Agreement and that the Company need not seek any further consent from
me and may deal solely with my spouse in connection with all matters under the
Buy-Sell Agreement.
Dated:
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(Signature of spouse)
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(Print name of spouse)
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