EXHIBIT 10.1
SOMERA COMMUNICATIONS, INC.
FORM OF STAND-ALONE STOCK OPTION AGREEMENT
I. NOTICE OF STOCK OPTION GRANT
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You have been granted a Nonstatutory Stock Option to purchase Common Stock
of the Company, subject to the terms and conditions of this Agreement, as
follows:
Date of Grant
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Vesting Commencement Date
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Exercise Price per Share $
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Total Number of Shares Granted
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Total Exercise Price $
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Term/Expiration Date:
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Vesting Schedule:
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This Option shall vest and may be exercised, in whole or in part, in
accordance with the following schedule:
25% of the Shares subject to the Option shall vest one year after the
Vesting Commencement Date, and 1/48th of the Shares subject to the Option shall
vest each month thereafter, so that the Option shall be fully vested four (4)
years from the Date of Grant, subject to the Optionee continuing to be a Service
Provider on such dates, provided, that such vesting shall be subject to
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acceleration in certain events pursuant to Section 5(e) of the Employment
Agreement between Optionee and the Company.
Termination Period
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This Option may be exercised for three (3) months after Optionee ceases to
be a Service Provider in accordance with Section 7 of this Agreement, provided,
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however, that in the event that Optionee's employment with the Company is
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"Constructively Terminated" or involuntarily
terminated other than for "Cause" (as such terms are defined in the Employment
Agreement between Optionee and the Company), then this Option may be exercised
for six (6) months after Optionee ceases to be a Service Provider. Upon the
death or Disability of the Optionee, this Option may be exercised for one year
after the Optionee ceases to be a Service Provider in accordance with Section 8
or 9 of this Agreement. In no event shall this Option be exercised later that
the Term/Expiration Date provided.
II. AGREEMENT
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1. Definitions. As used herein, the following definitions shall apply:
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(a) "Agreement" means this stock option agreement between the Company
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and Optionee evidencing the terms and conditions of this Option.
(b) "Applicable Laws" means the requirements relating to the
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administration of stock options under U.S. state corporate laws, U.S.
federal and state securities laws, the Code, any stock exchange or
quotation system on which the Common Stock is listed or quoted and the
applicable laws of any foreign country or jurisdiction that may apply to
this Option.
(c) "Board" means the Board of Directors of the Company or any
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committee of the Board that has been designated by the Board to administer
this Agreement.
(d) "Code" means the Internal Revenue Code of 1986, as amended.
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(e) "Common Stock" means the common stock of the Company.
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(f) "Company" means Somera Communications, Inc., a Delaware
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corporation.
(g) "Consultant" means any person, including an advisor, engaged by
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the Company or a Parent or Subsidiary to render services to such
entity.
(h) "Director" means a member of the Board.
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(i) "Disability" means total and permanent disability as defined in
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Section 22(e)(3) of the Code.
(j) "Employee" means any person, including Officers and Directors,
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employed by the Company or any Parent or Subsidiary of the Company. A
Service Provider shall not cease to be an Employee in the case of (i) any
leave of absence approved by the Company or (ii) transfers between
locations of the Company or between the Company, its Parent, any
Subsidiary, or any successor. Neither service as a Director nor payment of
a director's fee by the Company shall be sufficient to constitute
"employment" by the Company.
(k) "Exchange Act" means the Securities Exchange Act of 1934, as
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amended.
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(l) "Fair Market Value" means, as of any date, the value of Common
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Stock determined as follows:
(1) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the
Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq
Stock Market, its Fair Market Value shall be the closing sales price
for such stock (or the closing bid, if no sales were reported) as
quoted on such exchange or system for the last market trading day
prior to the time of determination, as reported in The Wall Street
Journal or such other source as the Board deems reliable;
(2) If the Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market
Value shall be the mean between the high bid and low asked prices for
the Common Stock on the last market trading day prior to the day of
determination; or
(3) In the absence of an established market for the Common Stock,
the Fair Market Value thereof shall be determined in good faith by the
Board.
(m) "Nonstatutory Stock Option" means an Option not intended to
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qualify as an incentive stock option within the meaning of Section 422 of
the Code and the regulations promulgated thereunder.
(n) "Notice of Grant" means a written notice, in Part I of this
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Agreement, evidencing certain of the terms and conditions of this Option
grant. The Notice of Grant is part of the Option Agreement.
(o) "Officer" means a person who is an officer of the Company within
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the meaning of Section 16 of the Exchange Act and the rules and
regulations promulgated thereunder.
(p) "Option" means this stock option.
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(q) "Optioned Stock" means the Common Stock subject to this Option.
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(r) "Optionee" means the person named in the Notice of Grant or such
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person's successor.
(s) "Parent" means a "parent corporation," whether now or hereafter
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existing, as defined in Section 424(e) of the Code.
(t) "Service Provider" means an Employee, Director or Consultant.
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(u) "Share" means a share of the Common Stock, as adjusted in
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accordance with Section 10 of this Agreement.
(v) "Subsidiary" means a "subsidiary corporation", whether now or
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hereafter existing, as defined in Section 424(f) of the Code.
2. Grant of Option. The Board hereby grants to the Optionee named in the
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Notice of Grant attached as Part I of this Agreement the Option to purchase the
number of Shares, as set forth in the Notice of Grant, at the exercise price per
share set forth in the Notice of Grant (the "Exercise Price"), subject to the
terms and conditions of this Agreement.
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3. Exercise of Option.
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(a) Right to Exercise. This Option is exercisable during its term in
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accordance with the Vesting Schedule set out in the Notice of Grant and the
applicable provisions of this Agreement.
(b) Method of Exercise. This Option is exercisable by delivery of an
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exercise notice, in the form attached as Exhibit A (the "Exercise Notice"),
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which shall state the election to exercise the Option, the number of Shares
in respect of which the Option is being exercised (the "Exercised Shares"),
and such other representations and agreements as may be required by the
Company. The Exercise Notice shall be completed by the Optionee and
delivered to Secretary of the Company. The Exercise Notice shall be
accompanied by payment of the aggregate Exercise Price as to all Exercised
Shares. This Option shall be deemed to be exercised upon receipt by the
Company of such fully executed Exercise Notice accompanied by such
aggregate Exercise Price.
(c) Legal Compliance. No Shares shall be issued pursuant to the
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exercise of this Option unless such issuance and exercise complies with
Applicable Laws. Assuming such compliance, for income tax purposes the
Exercised Shares shall be considered transferred to the Optionee on the
date the Option is exercised with respect to such Exercised Shares.
(d) Buyout Provisions. The Board may at any time offer to buy out for
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a payment in cash or Shares an Option previously granted based on such
terms and conditions as the Board shall establish and communicate to the
Optionee at the time that such offer is made.
4. Method of Payment. Payment of the aggregate Exercise Price shall be by
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any of the following, or a combination thereof, at the election of the Optionee:
(a) cash or check;
(b) consideration received by the Company under a cashless exercise
program implemented by the Company; or
(c) surrender of other Shares which (i) in the case of Shares acquired
upon exercise of an option, have been owned by the Optionee for more than
six (6) months on the date of surrender, and (ii) have a Fair Market Value
on the date of surrender equal to the aggregate Exercise Price of the
Exercised Shares.
5. Limited Transferability of Option. This Option may not be transferred in
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any manner other than (i) by will or by the laws of descent or distribution, or
(ii) with the Board's consent and pursuant to such procedures as the Board (in
its discretion) may specify, in a manner which would not prevent this Option
from being registered on Form S-8 in the reasonable judgment of the Company's
legal counsel. This Option may be exercised during the lifetime of Optionee only
by the Optionee or a valid transferee. The terms of this Option Agreement shall
be binding upon the executors, administrators, heirs, successors and assigns of
the Optionee and in order to effect a valid transfer, the transferee shall
execute an assignment agreeing to the terms of this Option Agreement.
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6. Term of Option. This Option may be exercised only within the term set
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out in the Notice of Grant, and may be exercised during such term only in
accordance with the terms of this Agreement.
7. Termination of Relationship as a Service Provider. If the Optionee
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ceases to be a Service Provider (other than for death or Disability), this
Option may be exercised for a period of three (3) months after the date of such
termination (but in no event later than the expiration date of this Option as
set forth in the Notice of Grant) to the extent that the Option is vested on the
date of such termination, provided, however, that in the event that Optionee's
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employment with the Company is "Constructively Terminated" or involuntarily
terminated other than for "Cause" (as such terms are defined in the Employment
Agreement between Optionee and the Company), then this Option may be exercised
for six (6) months after Optionee ceases to be a Service Provider (but in no
event later than the expiration date of this Option as set forth in the Notice
of Grant) to the extent that the Option is vested on the date of such
termination. To the extent that the Optionee does not exercise this Option
within the time specified herein, the Option shall terminate.
8. Disability of Optionee. If the Optionee ceases to be a Service Provider
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as a result of the Optionee's Disability, this Option may be exercised for a
period of twelve (12) months after the date of such termination (but in no event
later than the expiration date of this Option as set forth in the Notice of
Grant) to the extent that the Option is vested on the date of such termination.
To the extent that Optionee does not exercise this Option within the time
specified herein, the Option shall terminate.
9. Death of Optionee. If the Optionee dies while a Service Provider, the
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Option may be exercised at any time within twelve (12) months following the date
of death (but in no event later than the expiration date of this Option as set
forth in the Notice of Grant), by the Optionee's estate or by a person who
acquired the right to exercise the Option by bequest or inheritance, but only to
the extent that the Optionee was entitled to exercise the Option at the date of
death. If, after death, the Optionee's estate or a person who acquired the right
to exercise the Option by bequest or inheritance does not exercise the Option
within the time specified herein, the Option shall terminate.
10. Adjustments upon Changes in Capitalization, Dissolution, Merger or
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Asset Sale.
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(a) Changes in Capitalization. Subject to any required action by the
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stockholders of the Company, the number of shares of Common Stock covered
by this Option, as well as the price per share of Common Stock covered by
this Option, shall be proportionately adjusted for any increase or decrease
in the number of issued shares of Common Stock resulting from a stock
split, reverse stock split, stock dividend, combination or reclassification
of the Common Stock, or any other increase or decrease in the number of
issued shares of Common Stock effected without receipt of consideration by
the Company; provided, however, that conversion of any convertible
securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the
Board, whose determination in that respect shall be final, binding and
conclusive. Except as expressly provided herein, no issuance by the Company
of shares of stock of any class, or securities convertible into shares of
stock of any class, shall affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of shares of Common Stock
subject to this Option.
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(b) Dissolution or Liquidation. In the event of the proposed
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dissolution or liquidation of the Company, the Board shall notify Optionee
as soon as practicable prior to the effective date of such proposed
transaction. The Board in its discretion may provide for the Optionee to
have the right to exercise his or her Option until fifteen (15) days prior
to such transaction as to all of the Optioned Stock covered thereby,
including Shares as to which the Option would not otherwise be exercisable.
To the extent it has not been previously exercised, the Option will
terminate immediately prior to the consummation of such proposed
transaction.
(c) Merger or Asset Sale. In the event of a merger of the Company with
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or into another corporation, or the sale of substantially all of the assets
of the Company, the Option shall be assumed or an equivalent option
substituted by the successor corporation or a Parent or Subsidiary of the
successor corporation. In the event that the successor corporation refuses
to assume or substitute for the Option, the Optionee shall fully vest in
and have the right to exercise the Option as to all of the Optioned Stock,
including Shares as to which it would not otherwise be vested or
exercisable. If the Option becomes fully vested and exercisable in lieu of
assumption or substitution in the event of a merger or sale of assets, the
Board shall notify the Optionee in writing or electronically that the
Option shall be fully exercisable for a period of fifteen (15) days from
the date of such notice, and the Option shall terminate upon the expiration
of such period. For the purposes of this paragraph, the Option shall be
considered assumed if, following the merger or sale of assets, the option
confers the right to purchase or receive, for each Share of Optioned Stock
subject to the Option immediately prior to the merger or sale of assets,
the consideration (whether stock, cash, or other securities or property)
received in the merger or sale of assets by holders of Common Stock for
each Share held on the effective date of the transaction (and if holders
were offered a choice of consideration, the type of consideration chosen by
the holders of a majority of the outstanding Shares); provided, however,
that if such consideration received in the merger or sale of assets is not
solely common stock of the successor corporation or its Parent, the Board
may, with the consent of the successor corporation, provide for the
consideration to be received upon the exercise of the Option, for each
Share of Optioned Stock subject to the Option, to be solely common stock of
the successor corporation or its Parent equal in fair market value to the
per share consideration received by holders of Common Stock in the merger
or sale of assets.
11. Notices. Any notice to be given to the Company hereunder shall be in
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writing and shall be addressed to the Company. at its then current principal
executive office or to such other address as the Company may hereafter designate
to the Optionee by notice as provided in this Section. Any notice to be given to
the Optionee hereunder shall be addressed to the Optionee at the address set
forth beneath his signature hereto, or at such other address as the Optionee may
hereafter designate to the Company by notice as provided herein. All notices,
requests, demands and other communications called for hereunder shall be in
writing and shall be deemed given if (i) delivered personally or by facsimile,
(ii) one (1) day after being sent by Federal Express or a similar commercial
overnight service, or (iii) three (3) days after being mailed by registered or
certified mail, return receipt requested, prepaid and addressed to the parties
or their successors in interest.
12. Tax Consequences. Some of the federal tax consequences relating to this
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Option, as of the date of this Option, are set forth below. THIS SUMMARY IS
NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE.
THE OPTIONEE SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR
DISPOSING OF THE SHARES.
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(a) Exercising the Option. The Optionee may incur regular federal
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income tax liability upon exercise of a Nonstatutory Stock Option (an
"NSO"). The Optionee will be treated as having received compensation income
(taxable at ordinary income tax rates) equal to the excess, if any, of the
Fair Market Value of the Exercised Shares on the date of exercise over
their aggregate Exercise Price. If the Optionee is an Employee or a former
Employee, the Company will be required to withhold from his or her
compensation or collect from Optionee and pay to the applicable taxing
authorities an amount in cash equal to a percentage of this compensation
income at the time of exercise, and may refuse to honor the exercise and
refuse to deliver Shares if such withholding amounts are not delivered at
the time of exercise.
(b) Disposition of Shares. If the Optionee holds NSO Shares for at
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least one year, any gain realized on disposition of the Shares will be
treated as long-term capital gain for federal income tax purposes.
13. Entire Agreement; Governing Law. This Agreement constitutes the entire
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agreement of the parties with respect to the subject matter hereof and
supersedes in their entirety all prior undertakings and agreements of the
Company and Optionee with respect to the subject matter hereof, and may not be
modified adversely to the Optionee's interest except by means of a writing
signed by the Company and Optionee. This agreement is governed by the internal
substantive laws, but not the choice of law rules, of California.
14. NO GUARANTEE OF CONTINUED SERVICE. OPTIONEE ACKNOWLEDGES AND AGREES
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THAT THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED
ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (AND NOT
THROUGH THE ACT OF BEING HIRED, BEING GRANTED AN OPTION OR PURCHASING SHARES
HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE
TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO
NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A
SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL
NOT INTERFERE WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE
OPTIONEE'S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT
CAUSE.
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By your signature and the signature of the Company's representative below,
you and the Company agree that this Option is granted under and governed by the
terms and conditions of this Agreement. Optionee has reviewed this Agreement in
its entirety, has had an opportunity to obtain the advice of counsel prior to
executing this Agreement and fully understands all provisions of this Agreement.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Board upon any questions relating to this Agreement.
Optionee further agrees to notify the Company upon any change in the residence
address indicated below.
OPTIONEE SOMERA COMMUNICATIONS, INC.
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Signature By
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Print Name Title
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Residence Address
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CONSENT OF SPOUSE
The undersigned spouse of Optionee has read and hereby approves the terms
and conditions of this Agreement. In consideration of the Company's granting her
spouse the right to purchase Shares as set forth in this Agreement, the
undersigned hereby agrees to be irrevocably bound by the terms and conditions of
this Agreement and further agrees that any community property interest shall be
similarly bound. The undersigned hereby appoints the undersigned's spouse as
attorney-in-fact for the undersigned with respect to any amendment or exercise
of rights under this Agreement.
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Spouse of Optionee
EXHIBIT A
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SOMERA COMMUNICATIONS, INC.
EXERCISE NOTICE
Somera Communications, Inc.
5383 Hollister Avenue
Santa Barbara, CA 93111
Attention: Controller
1. Exercise of Option. Effective as of today, ________________, 200__, the
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undersigned ("Purchaser") hereby elects to purchase ______________ shares (the
"Shares") of the Common Stock of Somera Communications, Inc. (the "Company")
under and pursuant to the Stand-Alone Stock Option Agreement dated
______________ (the "Option Agreement"). The purchase price per share for the
Shares shall be [$_______], as required by the Option Agreement.
2. Delivery of Payment. Purchaser herewith delivers to the Company the full
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purchase price for the Shares.
3. Representations of Purchaser. Purchaser acknowledges that Purchaser has
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received, read and understood the Option Agreement and agrees to abide by and be
bound by its terms and conditions.
4. Rights as Shareholder. Until the issuance (as evidenced by the
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appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the Shares, no right to vote or receive dividends or
any other rights as a stockholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. The Shares so acquired shall
be issued to the Optionee as soon as practicable after exercise of the Option.
No adjustment will be made for a dividend or other right for which the record
date is prior to the date of issuance, except as provided in Section 10 of the
Option Agreement.
5. Tax Consultation. Purchaser understands that Purchaser may suffer
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adverse tax consequences as a result of Purchaser's purchase or disposition of
the Shares. Purchaser represents that Purchaser has consulted with any tax
consultants Purchaser deems advisable in connection with the purchase or
disposition of the Shares and that Purchaser is not relying on the Company for
any tax advice.
6. Successors and Assigns. The Company may assign any of its rights under
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this Exercise Notice to single or multiple assignees, and this Exercise Notice
shall inure to the benefit of the successors and assigns of the Company. Subject
to the restrictions on transfer herein set forth, this Exercise Notice shall be
binding upon Optionee and his or her heirs, executors, administrators,
successors and assigns.
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7. Interpretation. Any dispute regarding the interpretation of this
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Exercise Notice shall be submitted by Optionee or by the Company forthwith to
the Board which shall review such dispute at its next regular meeting. The
resolution of such a dispute by the Board shall be final and binding on all
parties.
8. Entire Agreement; Governing Law. The Option Agreement is incorporated
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herein by reference. This Exercise Notice and the Option Agreement constitute
the entire agreement of the parties with respect to the subject matter hereof
and supersede in their entirety all prior undertakings and agreements of the
Company and Purchaser with respect to the subject matter hereof, and may not be
modified adversely to the Purchaser's interest except by means of a writing
signed by the Company and Purchaser. This agreement is governed by the internal
substantive laws, but not the choice of law rules, of California.
Submitted by: Accepted by:
OPTIONEE SOMERA COMMUNICATIONS, INC.
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Signature
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Print Name Title
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Address
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Date Received:
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