Exhibit 10.2B
Form of Option Award Agreement for Directors
NON-QUALIFIED STOCK OPTION AWARD
PURSUANT TO THE VERILINK CORPORATION
2002 STOCK INCENTIVE PLAN
THIS AWARD is made as of the Grant Date by VERILINK CORPORATION (the
"Company") to ____________________________________ (the "Optionee").
Upon and subject to the Terms and Conditions attached hereto and
incorporated herein by reference, the Company hereby awards as of the Grant Date
to Optionee an option (the "Option"), as described below, to purchase the Option
Shares.
A. Grant Date: _______________________.
B. Type of Option: Non-Qualified Stock Option issued under the
Verilink Corporation 2002 Stock Incentive Plan (the "Plan").
C. Plan under which granted: Verilink Corporation 2002 Stock
Incentive Plan.
D. Option Shares: All or any part of __________ shares of the
Company's common stock, $.01 par value per share (the
"Stock"), subject to adjustment as provided in the attached
Terms and Conditions.
E. Exercise Price: $_______ per share, subject to adjustment as
provided in the attached Terms and Conditions.
F. Option Period: The Option may be exercised only during the
Option Period which commences on the Grant Date and ends on
the earlier of (a) the tenth (10th) anniversary of the Grant
Date; (b) the later of the date (i) three (3) months following
the date the Optionee ceases to be a director of the Company
for any reason other than due to death, Disability or a Change
in Control; or (ii) twelve (12) months following the date the
Optionee ceases to be a director of the Company due to death,
Disability or a Change in Control; provided that the Option
may be exercised as to no more than the vested Option Shares,
determined pursuant to the Vesting Schedule. Note that other
limitations to exercising the Option, as described in the
attached Terms and Conditions, may apply.
G. Vesting Schedule (Schedule 1): The Option Shares shall become
vested in accordance with the attached Vesting Schedule. All
or a portion of the Option Shares may become vested on an
earlier date as provided in the attached Terms and Conditions.
IN WITNESS WHEREOF, the Company has executed and sealed this Award as
of the Grant Date set forth above.
VERILINK CORPORATION
By: ______________________________________
Title: ___________________________________
TERMS AND CONDITIONS
TO THE
NON-QUALIFIED STOCK OPTION AWARD
PURSUANT TO THE VERILINK CORPORATION
2002 STOCK INCENTIVE PLAN
1. Exercise of Option. Subject to the provisions of the Plan and the
Award which is made pursuant to the Verilink Corporation 2002 Stock Incentive
Plan and subject also to these Terms and Conditions, which are incorporated in
and made a part of the attached Award:
(a) the Option may be exercised with respect to all or any
portion of the Vested Option Shares at any time during the Option
Period by the delivery to the Company, at its principal place of
business, of a written notice of exercise in substantially the form
attached hereto as Exhibit 1; and
(b) payment to the Company of the Exercise Price multiplied by
the number of Vested Option Shares being purchased (the "Purchase
Price") as provided in Section 2.
Upon acceptance of such notice and receipt of payment in full of the Purchase
Price, the Company shall cause to be issued a certificate representing the
Vested Option Shares purchased.
2. Purchase Price. Payment of the Purchase Price for all Vested Option
Shares purchased pursuant to the exercise of an Option shall be made
(a) in cash or certified check;
(b) by delivery to the Company of a number of shares of Stock
which have been owned by the Optionee for at least six (6) months prior
to the date of the Option's exercise having a fair market value, as
determined under the Plan, on the date of exercise either equal to the
Purchase Price or in combination with cash or a certified check to equal
the Purchase Price;
(c) by receipt of the Purchase Price in cash from a broker,
dealer or other "creditor" as defined by Regulation T issued by the
Board of Governors of the Federal Reserve System following delivery by
the Optionee to the Committee of instructions in a form acceptable to
the Committee regarding delivery to such broker, dealer or other
creditor of that number of Option Shares with respect to which the
Option is exercised; provided, however, that any such cashless exercise
must be effected in a manner consistent with the restrictions of Section
13(k) of the Securities Exchange Act of 1934 (Section 402 of the
Sarbanes-Oxley Act of 2002); or
(d) or any combination of the foregoing.
3. Vested Option Shares. The Option Shares shall become vested in the
manner provided in the Vesting Schedule attached hereto. In the event of a
Change in Control, including a Change in Control approved by the Board of
Directors, the Option Shares shall become fully vested immediately prior to the
effective date of the Change in Control.
1
4. Rights as Shareholder. Until the stock certificates reflecting the
Option Shares accruing to the Optionee upon exercise of the Option are issued to
the Optionee, the Optionee shall have no rights as a shareholder with respect to
such Option Shares. The Company shall make no adjustment for any dividends or
distributions or other rights on or with respect to Option Shares for which the
record date is prior to the issuance of that stock certificate, except as the
Plan or the attached Award otherwise provides.
5. Restriction on Transfer of Option and of Option Shares. Except as
otherwise expressly permitted by the Committee in writing, the Option evidenced
hereby is nontransferable other than by will or the laws of descent and
distribution and shall be exercisable during the lifetime of the Optionee only
by the Optionee (or in the event of his/her disability, by his/her personal
representative) and after his/her death, only by his/her legatee or the executor
of his/her estate.
6. Changes in Capitalization.
(a) Except as provided in Subsection (b) below, if the number
of shares of Stock shall be increased or decreased by reason of a
subdivision or combination of shares of Stock, the payment of an
ordinary stock dividend in shares of Stock or any other increase or
decrease in the number of shares of Stock outstanding effected without
receipt of consideration by the Company, an appropriate adjustment
shall be made by the Committee, in a manner determined in its sole
discretion, in the number and kind of Option Shares and in the Exercise
Price.
(b) In the event of a merger, consolidation, reorganization,
extraordinary dividend or other change in the corporate structure of
the Company, including a Change in Control, or tender offer for shares
of Stock, the Company shall provide for an appropriate adjustment to
the Option or provide for the substitution of a new option which
adjustment or substitution shall be consistent with the event requiring
the adjustment or substitution; provided, however, in the event the
Company will not be the surviving entity as a result of the event and
the surviving entity does not agree to the adjustment or substitution,
the Committee may elect to terminate the Option Period as of the date
of the Change in Control in consideration of the payment to the
Optionee of the sum of the difference between the then Fair Market
Value of the Stock and the Exercise Price for each Option Share as to
which the Option has not been exercised as of the date of the Change in
Control.
(c) The existence of the Plan and the Option granted pursuant
to this Agreement shall not affect in any way the right or power of the
Company to make or authorize any adjustment, reclassification,
reorganization or other change in its capital or business structure,
any merger or consolidation of the Company, any issue of debt or equity
securities having preferences or priorities as to the Stock or the
rights thereof, the dissolution or liquidation of the Company, any sale
or transfer of all or any part of its business or assets, or any other
corporate act or proceeding. Any adjustment pursuant to this Section
may provide, in the Committee's discretion, for the elimination without
payment therefor of any fractional shares that might otherwise become
subject to any Option.
7. Special Limitation on Exercise. No purported exercise of the Option
shall be effective without the approval of the Committee, which may be withheld
to the extent that the exercise, either individually or in the aggregate
together with the exercise of other previously exercised stock options and/or
offers and sales pursuant to any prior or contemplated offering of
2
securities, would, in the sole and absolute judgment of the Committee, require
the filing of a registration statement with the United States Securities and
Exchange Commission or with the securities commission of any state. If a
registration statement is not in effect under the Securities Act of 1933, or any
applicable state securities law with respect to shares of Stock purchasable or
otherwise deliverable under the Option, the Optionee (a) shall deliver to the
Company, prior to the exercise of the Option or as a condition to the delivery
of Stock pursuant to the exercise of an Option exercise, such information,
representations and warranties as the Company may reasonably request in order
for the Company to be able to satisfy itself that the Option Shares are being
acquired in accordance with the terms of an applicable exemption from the
securities registration requirements of applicable federal and state securities
laws and (b) shall agree that the shares of Stock so acquired will not be
disposed of except pursuant to an effective registration statement, unless the
Company shall have received an opinion of counsel that such disposition is
exempt from such requirement under the Securities Act of 1933 and any applicable
state securities law.
8. Legend on Stock Certificates. Certificates evidencing the Option
Shares, to the extent appropriate at the time, shall have noted conspicuously on
the certificates a legend intended to give all persons full notice of the
existence of the conditions, restrictions, rights and obligations set forth
herein and in the Plan.
9. Governing Laws. This Award and the Terms and Conditions shall be
construed, administered and enforced according to the laws of the State of
Delaware; provided, however, the Option may not be exercised except in
compliance with exemptions available under applicable state securities laws of
the state in which the Optionee resides and/or any other applicable securities
laws.
10. Successors. This Award and the Terms and Conditions shall be
binding upon and inure to the benefit of the heirs, legal representatives,
successors and permitted assigns of the Optionee and the Company.
11. Notice. Except as otherwise specified herein, all notices and other
communications under this Award shall be in writing and shall be deemed to have
been given if personally delivered or if sent by registered or certified United
States mail, return receipt requested, postage prepaid, addressed to the
proposed recipient at the last known address of the recipient. Any party may
designate any other address to which notices shall be sent by giving notice of
the address to the other parties in the same manner as provided herein.
12. Severability. In the event that any one or more of the provisions
or portion thereof contained in the Award and these Terms and Conditions shall
for any reason be held to be invalid, illegal or unenforceable in any respect,
the same shall not invalidate or otherwise affect any other provisions of the
Award and these Terms and Conditions, and the Award and these Terms and
Conditions shall be construed as if the invalid, illegal or unenforceable
provision or portion thereof had never been contained herein.
13. Entire Agreement. Subject to the terms and conditions of the Plan,
the Award and the Terms and Conditions express the entire understanding of the
parties with respect to the Option.
14. Violation. Any transfer, pledge, sale, assignment, or hypothecation
of the Option or any portion thereof shall be a violation of the terms of the
Award or these Terms and Conditions and shall be void and without effect.
3
15. Headings and Capitalized Terms. Section headings used herein are
for convenience of reference only and shall not be considered in construing the
Award or these Terms and Conditions. Capitalized terms used, but not defined, in
either the Award or the Terms and Conditions shall be given the meaning ascribed
to them in the Plan.
16. Specific Performance. In the event of any actual or threatened
default in, or breach of, any of the terms, conditions and provisions of the
Award and these Terms and Conditions, the party or parties who are thereby
aggrieved shall have the right to specific performance and injunction in
addition to any and all other rights and remedies at law or in equity, and all
such rights and remedies shall be cumulative.
17. No Right to Continued Service. Neither the establishment of the
Plan nor the award of Option Shares hereunder shall be construed as giving the
Optionee the right to continued service as a director of the Company or in any
other capacity.
4
SCHEDULE 1
VERILINK CORPORATION
NON-QUALIFIED STOCK OPTION AWARD
Vesting Schedule
"Vested Option Shares" means only that percentage of the number of
shares of Stock subject to the Option as to which the Option becomes exercisable
after the Vesting Commencement Date following completion of a continuous period
of service indicated in the schedule below.
The Option will vest as to thirty-three and one-third percent (331/3%)
of the Option Shares on the first anniversary of the Vesting
Commencement Date and then an additional 1/36th of the Option Shares
shall become Vested Option Shares per month thereafter until the third
anniversary of the Vesting Commencement Date at which point all Option
Shares will be Vested Option Shares; provided, however, that the
vesting of Option Shares shall continue only if the Optionee remains at
all times in the continuous service of the Company as a director from
and after the Vesting Commencement Date.
For purposes of this Vesting Schedule, the Vesting Commencement Date is
_______________.
1. Construction.
The right of Optionee to vest in Option Shares shall cease upon the
termination of his or her service as a director of the Company, whether by
reason of death, Disability or otherwise and, thereafter, no further shares
shall become Vested Option Shares; and the Option shall be exercisable, only as
to Vested Option Shares determined as of the date of the termination of service,
during the remaining Option Period, as specified in the Award.
Schedule 1 - Page 1
EXHIBIT 1
NOTICE OF EXERCISE OF
STOCK OPTION TO PURCHASE
COMMON STOCK OF
VERILINK CORPORATION
Name ________________________
Address _____________________
_____________________________
Date ________________________
Verilink Corporation
127 Jetplex Circle
Madison, Alabama 35758-8989
Attn: Corporate Secretary
Re: Exercise of Non-Qualified Stock Option
Gentlemen:
Subject to acceptance hereof by Verilink Corporation (the "Company")
pursuant to the provisions of the Verilink Corporation 2002 Stock Incentive Plan
(the "Plan") I hereby give notice of my election to exercise options granted to
me to purchase ______________ shares of common stock $.01 par value ("Common
Stock"), of the Company under the Non-Qualified Stock Option Award (the "Award")
dated as of ____________. The purchase shall take place as of __________, 200__
(the "Exercise Date").
On or before the Exercise Date, I will pay the applicable purchase
price as follows:
[ ] by delivery of cash or a certified check for $___________
for the full purchase price payable to the order of Verilink
Corporation.
[ ] by delivery of cash or a certified check for $___________
representing a portion of the purchase price with the balance to
consist of shares of Common Stock that I have owned for at least
six months and that are represented by a stock certificate I
will surrender to the Company with my endorsement. If the number
of shares of Common Stock represented by such stock certificate
exceeds the number to be applied against the purchase price, I
understand that a new stock certificate will be issued to me
reflecting the excess number of shares.
[ ] by delivery of a stock certificate representing shares of
Common Stock that I have owned for at least six months which I
will surrender to the Company with my endorsement as payment of
the purchase price. If the number of shares of Common Stock
represented by such certificate exceeds the number to be applied
against the purchase price, I understand that a new certificate
will be issued to me reflecting the excess number of shares.
Exhibit 1 - Page 1
[ ] by delivery of the purchase price by
_________________________, a broker, dealer or other "creditor"
as defined by Regulation T issued by the Board of Governors of
the Federal Reserve System. I hereby authorize the Company to
issue a stock certificate for the number of shares indicated
above in the name of said broker, dealer or other creditor or
its nominee pursuant to instructions received by the Company and
to deliver said stock certificate directly to that broker,
dealer or other creditor (or to such other party specified in
the instructions received by the Company from the broker, dealer
or other creditor) upon receipt of the purchase price.
As soon as the stock certificate is registered in my name, please
deliver it to me at the above address.
If the Common Stock being acquired is not registered for issuance to
the Optionee pursuant to an effective registration statement on Form S-8 (or
successor form) filed under the Securities Act of 1933, as amended (the "1933
Act"), I understand and agree that I may be required to make such additional
representations, warranties, covenants, and agreements with the Company as the
Company may reasonably request.
I understand that the certificates representing the shares being
purchased by me in accordance with this notice shall bear a legend referring to
the foregoing covenants, representations and warranties and restrictions on
transfer, and I agree that a legend to that effect may be placed on any
certificate which may be issued to me as a substitute for the certificates being
acquired by me in accordance with this notice.
Very truly yours,
_________________________________
AGREED TO AND ACCEPTED:
VERILINK CORPORATION
By: __________________________________
Title: _______________________________
Number of Shares
Exercised: ___________________________
Number of Shares
Remaining: ___________________________ Date: _________________
Exhibit 1 - Page 2