Exhibit 4.16
INCENTIVE STOCK OPTION
(Name)_, Optionee:
ClariNet Communications Corp. (the "Company"), pursuant to its 1996 Stock
Option Plan (the "Plan"), has granted to you, the optionee named above, an
option to purchase shares of the Company's common stock ("Common Stock").
This option is intended to qualify as an "incentive stock option" within the
meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code").
The grant hereunder is in connection with and in furtherance of the
Company's compensatory benefit plan for participation of the Company's
employees (including officers), directors or consultants and is intended to
comply with the provisions of (i) Rule 701 promulgated by the Securities and
Exchange Commission under the Securities Act of 1933, as amended (the
"Securities Act") and (ii) Section 25102(o) of the California Corporations
Code. Defined terms not explicitly defined in this agreement but defined in
the Plan shall have the same definitions as in the Plan.
The details of your option are as follows:
Total Number Of Shares Subject To This Option. The total number of
shares of Common Stock subject to this option is _(Total Shares)__.
Vesting. Subject to the limitations contained herein,(Vest Percent)% of
the option shares will vest (become exercisable) on (Vest Date), 19 (Vest
Year) with the remaining shares vesting in equal increments, each year, on
this date over the next _three_ ( 3) years thereafter until either (i) you
cease to provide services to the Company for any reason, or (ii) this option
becomes fully vested.
Exercise Price And Method Of Payment.
Exercise Price. The exercise price of this option is (Exercise Price) DOLLARS
($___) per share, being not less than the Fair Market Value of the Common
Stock on the date of grant of this option.
Method of Payment. Payment of the exercise price per share is due in full
upon exercise of all or any part of each installment which has accrued to you.
You may elect, to the extent permitted by applicable statutes and regulations,
to make payment of the exercise price under one of the following alternatives:
Payment of the exercise price per share in cash (including check) at the
time of exercise;
Payment pursuant to a program developed under Regulation T as promulgated
by the Federal Reserve Board which, prior to the issuance of Common Stock,
results in either the receipt of cash (or check) by the Company or the receipt
of irrevocable instructions to pay the aggregate exercise price to the Company
from the sales proceeds;
Provided that at the time of exercise the Company's Common Stock is
publicly traded and quoted regularly in the Wall Street Journal, payment by
delivery of already-owned shares of Common Stock, held for the period required
to avoid a charge to the Company's reported earnings, and owned free and clear
of any liens, claims, encumbrances or security interests, which Common Stock
shall be valued at its fair market value on the date of exercise; or
Payment by a combination of the methods of payment permitted by
subparagraphs 3(b)(i) through 3(b)(iii) above.
Whole Shares. This option may only be exercised for whole shares.
Securities Law Compliance. Notwithstanding anything to the contrary
contained herein, this option may not be exercised unless the shares issuable
upon exercise of this option are then registered under the Securities Act or,
if such shares are not then so registered, the Company has determined that
such exercise and issuance would be exempt from the registration requirements
of the Securities Act.
Term. The term of this option commences on (Grant Date), 19__, the date
of grant, and expires on (Expiration Date) (the "Expiration Date"), which date
shall be no more than ten (10) years from date this option is granted, unless
this option expires sooner as set forth below or in the Plan. In no event may
this option be exercised on or after the Expiration Date. This option shall
terminate prior to the Expiration Date as follows: thirty (30) days after the
termination of your Continuous Status as an Employee, Director or Consultant
with the Company or an Affiliate of the Company unless one of the following
circumstances exists:
Your termination of Continuous Status as an Employee is due to your
disability. This option will then expire on the earlier of the Expiration
Date set forth above or twelve (12) months following such termination of
Continuous Status as an Employee. You should be aware that if your disability
is not considered a permanent and total disability within the meaning of
Section 422(c)(6) of the Code, and you exercise this option more than three
(3) months following the date of your termination of employment, your exercise
will be treated for tax purposes as the exercise of a "nonstatutory stock
option" instead of an "incentive stock option" under the federal tax laws.
Your termination of Continuous Status as an Employee, Director or
Consultant is due to your death or your death occurs within thirty (30) days
following your termination of Continuous Status as an Employee, Director or
Consultant for any other reason. This option will then expire on the earlier
of the Expiration Date set forth above or twelve (12) months after your death.
If during any part of such thirty (30) day period you may not exercise
your option solely because of the condition set forth in paragraph 5 above,
then your option will not expire until the earlier of the Expiration Date set
forth above or until this option shall have been exercisable for an aggregate
period of thirty (30) days after your termination of Continuous Status as an
Employee, Director or Consultant.
If your exercise of the option within thirty (30) days after termination
of your Continuous Status as an Employee, Director or Consultant with the
Company or with an Affiliate of the Company would result in liability under
Section 16(b) of the Securities Exchange Act of 1934, as amended, then your
option will expire on the earlier of (i) the Expiration Date set forth above,
(ii) the tenth (10th) day after the last date upon which exercise would result
in such liability or (iii) six (6) months and ten (10) days after the
termination of your Continuous Status as an Employee, Director or Consultant
with the Company or an Affiliate of the Company.
However, this option may be exercised following termination of Continuous
Status as an Employee only as to that number of shares as to which it was
exercisable on the date of termination of Continuous Status as an Employee
under the provisions of paragraph 2 of this option.
In order to obtain the federal income tax advantages associated with an
"incentive stock option," the Code requires that at all times beginning on the
date of grant of the option and ending on the day three (3) before the date of
the option's exercise, you must be an employee of the Company or an Affiliate
of the Company, except in the event of your death or permanent and total
disability. The Company has provided for continued vesting or extended
exerciseability of your option under certain circumstances for your benefit,
but cannot guarantee that your option will necessarily be treated as an
"incentive stock option" if you provide services to the Company or an
Affiliate of the Company as a consultant or exercise your option more than
three (3) months after the date your employment with the Company and all
Affiliates of the Company terminates.
Exercise.
This option may be exercised, to the extent specified above, by
delivering a notice of exercise (in a form designated by the Company) together
with the exercise price to the Secretary of the Company, or to such other
person as the Company may designate, during regular business hours, together
with such additional documents as the Company may then require pursuant to
subsection 6(f) of the Plan.
By exercising this option you agree that:
as a precondition to the completion of any exercise of this option, the
Company may require you to enter an arrangement providing for the payment by
you to the Company of any tax withholding obligation of the Company arising by
reason of (1) the exercise of this option; (2) the lapse of any substantial
risk of forfeiture to which the shares are subject at the time of exercise; or
(3) the disposition of shares acquired upon such exercise;
you will notify the Company in writing within fifteen (15) days after the
date of any disposition of any of the shares of the Common Stock issued upon
exercise of this option that occurs within two (2) years after the date of
this option grant or within one (1) year after such shares of Common Stock are
transferred upon exercise of this option; and
the Company (or a representative of the underwriters) may, in connection
with the first underwritten registration of the offering of any securities of
the Company under the Securities Act, require that you not sell or otherwise
transfer or dispose of any shares of Common Stock or other securities of the
Company during such period (not to exceed one hundred eighty (180) days)
following the effective date (the "Effective Date") of the registration
statement of the Company filed under the Securities Act as may be requested by
the Company or the representative of the underwriters. You further agree that
the Company may impose stop-transfer instructions with respect to securities
subject to the foregoing restrictions until the end of such period.
Transferability. This option is not transferable, except by will or by
the laws of descent and distribution, and is exercisable during your life only
by you. Notwithstanding the foregoing, by delivering written notice to the
Company, in a form satisfactory to the Company, you may designate a third
party who, in the event of your death, shall thereafter be entitled to
exercise this option.
Option Not a Service Contract. This option is not an employment contract
and nothing in this option shall be deemed to create in any way whatsoever any
obligation on your part to continue in the employ of the Company, or of the
Company to continue your employment with the Company. In addition, nothing in
this option shall obligate the Company or any Affiliate of the Company, or
their respective stockholders, Board of Directors, officers or employees to
continue any relationship which you might have as a Director or Consultant for
the Company or Affiliate of the Company.
Notices. Any notices provided for in this option or the Plan shall be
given in writing and shall be deemed effectively given upon receipt or, in the
case of notices delivered by the Company to you, five (5) days after deposit
in the United States mail, postage prepaid, addressed to you at the address
specified below or at such other address as you hereafter designate by written
notice to the Company.
Governing Plan Document. This option is subject to all the provisions of
the Plan, a copy of which is attached hereto and its provisions are hereby
made a part of this option, including without limitation the provisions of
Section 6 of the Plan relating to option provisions, and is further subject to
all interpretations, amendments, rules and regulations which may from time to
time be promulgated and adopted pursuant to the Plan. In the event of any
conflict between the provisions of this option and those of the Plan, the
provisions of the Plan shall control.
Right of First Refusal. The shares acquired upon exercise of this option
shall be subject to the Right of First Refusal which the Company may exercise
upon any purported transfer of the shares. In the event you wish to transfer
some or all of your fully-vested option shares, you must first disclose in
writing all material terms of such transfer to the Company. The Company will
then have the right to purchase from you, within the thirty (30)-day period
following receipt of such written notice (or such longer period as may be
agreed to by the Company and you), all (or any part of the shares with your
consent) of the shares acquired upon exercise of this option on substantially
the same terms and conditions as stated in the written notice. The Right of
First Refusal shall terminate upon the date of the first registration of an
equity security of the Company under Section 12 of the Exchange Act.
Dated the___ day of ____, 19__.
Very truly yours,
ClariNet Communications Corp.
By
Duly authorized on behalf
of the Board of Directors
ATTACHMENTS:
1996 Stock Option Plan
Notice of Exercise
The undersigned acknowledges receipt of the foregoing option and the
attachments referenced therein and understands that all rights and liabilities
with respect to this option are set forth in the option and the Plan.
OPTIONEE
Address: