EXHIBIT 10.2
ARC WIRELESS SOLUTIONS, INC.
2007 STOCK INCENTIVE PLAN
FORM OF STOCK OPTION AGREEMENT
ARC Wireless Solutions, Inc. (the "Company"), pursuant to its 2007 Stock
Incentive Plan (the "Plan"), hereby grants to Optionee listed below
("Optionee"), an option to purchase the number of shares of the Company's Common
Stock set forth below, subject to the terms and conditions of the Plan and this
Stock Option Agreement. Unless otherwise defined herein, the terms defined in
the Plan shall have the same defined meanings in this Stock Option Agreement.
1. NOTICE OF STOCK OPTION GRANT
Optionee: ___________________________________
Date of Stock Option Agreement: ___________________________________
Date of Grant: ___________________________________
Vesting Commencement Date: ___________________________________
Exercise Price per Share: ___________________________________
Total Number of Option Shares Granted: ___________________________________
Term/Expiration Date: ___________________________________
Type of Option: [ ] Incentive Stock Option or [ ] Non-Incentive Stock Option
Vesting Schedule: The Option Shares subject to this Option shall vest
according to the following schedule:
__________________________________________________________
__________________________________________________________
Termination Period: This Option may be exercised, to the extent vested, for one
month after Optionee ceases to be an Eligible Person, or
such longer period as may be applicable upon the death or
disability of Optionee as provided herein, but in no event
later than the Term/Expiration Date as provided above.
2. AGREEMENT
2.1 Grant of Option. The Company hereby grants to Optionee an Option
to purchase the number of shares of Common Stock (the "Option Shares") set forth
in the Notice of Grant, at the exercise price per share set forth in the Notice
of Grant (the "Exercise Price"). Notwithstanding anything to the contrary
anywhere else in this Option Agreement, this grant of an Option is subject to
the terms, definitions, and provisions of the Plan adopted by the Company, which
is incorporated herein by reference.
If designated in the Notice of Grant as an Incentive Stock Option,
this Option is intended to qualify as an Incentive Stock Option as defined in
Section 422 of the Code; provided, however, that to the extent that the
aggregate Fair Market Value of stock with respect to which Incentive Stock
Options (within the meaning of Code Section 422, but without regard to Code
Section 422(d)), including the Option, are exercisable for the first time by
Optionee during any calendar year (under the Plan and all other incentive stock
option plans of the Company, if any) exceeds $100,000, such options shall be
treated as not qualifying under Code Section 422, but rather shall be treated as
Non-Incentive Stock Options to the extent required by Code Section 422. The rule
set forth in the preceding sentence shall be applied by taking options into
account in the order in which they were granted. For purposes of these rules,
the Fair Market Value of stock shall be determined as of the time the option
with respect to such stock is granted.
2.2 Exercise of Option. This Option is exercisable as follows:
(a) Right to Exercise.
i. This Option shall be exercisable cumulatively
according to the vesting schedule set out in the Notice of
Grant. For purposes of this Stock Option Agreement, Option
Shares subject to this Option shall vest based on Optionee's
Continuous Status as an Eligible Person.
ii. This Option may not be exercised for a
fraction of a Share.
iii. In the event of Optionee's death, disability
or other termination of Optionee's status as an Eligible
Person, the exercisability of the Option is governed by
Sections 7, 8 and 9 below.
iv. In no event may this Option be exercised after
the date of expiration of the term of this Option as set
forth in the Notice of Grant.
(b) Method of Exercise. This Option shall be exercisable by written
Notice (in the form attached as Exhibit A). The Notice must state the number of
Option Shares for which the Option is being exercised, and such other
representations and agreements with respect to such Option Shares as may be
required by the Company pursuant to the provisions of the Plan. The Notice must
be signed by Optionee and shall be delivered in person or by certified mail to
the Secretary of the Company. The Notice must be accompanied by payment of the
Exercise Price plus payment of any applicable withholding tax. This Option shall
be deemed to be exercised upon receipt by the Company of such written Notice
accompanied by the Exercise Price and payment of any applicable withholding tax.
No Option Shares shall be issued pursuant to the exercise of an Option
unless such issuance and such exercise comply with all relevant provisions of
law and the requirements of any stock exchange upon which the Option Shares may
then be listed. Assuming such compliance, for income tax purposes the Option
Shares shall be considered transferred to Optionee on the date on which the
Option is exercised with respect to such Option Shares.
2.3 Optionee's Representations. If the Option Shares purchasable
pursuant to the exercise of this Option have not been registered under the
Securities Act of 1933, as amended (the "Securities Act"), at the time this
Option is exercised, Optionee shall, if required by the Company, concurrently
with the exercise of all or any portion of this Option, deliver to the Company
his or her Investment Representation Statement in the form attached hereto as
Exhibit B.
2.4 Lock-Up Period. Optionee hereby agrees that if so requested by the
Company or any representative of the underwriters (the "Managing Underwriter")
in connection with any registration of the offering of any securities of the
Company under the Securities Act, Optionee shall not sell or otherwise transfer
any Option Shares or other securities of the Company during the 180-day period
(or such period as may be requested in writing by the Managing Underwriter and
agreed to in writing by the Company) (the "Market Standoff Period") following
the effective date of a registration statement of the Company filed under the
Securities Act. The Company may impose stop-transfer instructions with respect
to securities subject to the foregoing restrictions until the end of such Market
Standoff Period and these restrictions shall be binding on any transferee of
such Option Shares.
2.5 Method of Payment. Payment of the Exercise Price shall be by any
of the following, or a combination thereof:
(a) cash;
(b) check; or
(c) with the consent of the Option Committee, any method of payment,
or combination thereof that is permitted in the Plan.
2.6 Restrictions on Exercise. If the issuance of Option Shares upon
such exercise or if the method of payment for such shares would constitute a
violation of any applicable federal or state securities or other law or
regulation, then the Option may also not be exercised. The Company may require
Optionee to make any representation and warranty to the Company as may be
required by any applicable law or regulation before allowing the Option to be
exercised.
2.7 Termination of Relationship. If Optionee ceases to be an Eligible
Person (other than by reason of Optionee's death or the total and permanent
disability of Optionee as defined in Code Section 22(e)(3)), Optionee may
exercise this Option, to the extent the Option was vested at the date on which
Optionee ceases to be an Eligible Person, but only within one month from such
date (and in no event later than the expiration date of the term of this Option
set forth in the Notice of Grant). To the extent that the Option is not vested
at the date on which Optionee ceases to be an Eligible Person, or if Optionee
does not exercise this Option within the time specified herein, the Option shall
terminate.
2.8 Disability of Optionee. If Optionee ceases to be an Eligible
Person as a result of his or her total and permanent disability as defined in
Code Section 22(e)(3), Optionee may exercise the Option to the extent the Option
was vested at the date on which Optionee ceases to be an Eligible Person, but
only within three months from such date (and in no event later than the
expiration date of the term of this Option as set forth in the Notice of Grant).
To the extent that the Option is not vested at the date on which Optionee ceases
to be an Eligible Person, or if Optionee does not exercise such Option within
the time specified herein, the Option shall terminate.
2.9 Death of Optionee. If Optionee ceases to be an Eligible Person as
a result of the death of Optionee, the vested portion of the Option may be
exercised at any time within three months following the date of death (and in no
event later than the expiration date of the term of this Option as set forth in
the Notice of Grant) by Optionee's estate or by a person who acquires the right
to exercise the Option by bequest or inheritance. To the extent that the Option
is not vested at the date of death, or if the Option is not exercised within the
time specified herein, the Option shall terminate.
2.10 Non-Transferability of Option. This Option may not be transferred
in any manner except by will or by the laws of descent or distribution. It may
be exercised during the lifetime of Optionee only by Optionee. The terms of this
Option shall be binding upon the executors, administrators, heirs, successors,
and assigns of Optionee.
2.11 Term of Option. This Option may be exercised only within the term
set out in the Notice of Grant.
2.12 Restrictions on Option Shares. Optionee hereby agrees that Option
Shares purchased upon the exercise of the Option shall be subject to such terms
and conditions as the Option Committee shall determine in its sole discretion.
Such terms and conditions may, in the Option Committee's sole discretion, be
contained in the Exercise Notice with respect to the Option or in such other
agreement as the Option Committee shall determine and which the Optionee hereby
agrees to enter into at the request of the Company.
(Signature Page Follows)
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original and all of which shall constitute one
document.
ARC WIRELESS SOLUTIONS, INC.
By:________________________________
Name:______________________________
Title:_____________________________
OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF OPTION SHARES
PURSUANT TO THE OPTION HEREOF IS EARNED ONLY BY CONTINUING CONSULTANCY
OR EMPLOYMENT AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING
HIRED, BEING GRANTED THIS OPTION OR ACQUIRING SHARES HEREUNDER).
OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT NOTHING IN THIS
AGREEMENT, NOR IN THE COMPANY'S 2007 STOCK INCENTIVE PLAN, WHICH IS
INCORPORATED HEREIN BY REFERENCE, SHALL CONFER UPON OPTIONEE ANY RIGHT
WITH RESPECT TO CONTINUATION OF EMPLOYMENT OR CONSULTANCY BY THE
COMPANY, NOR SHALL IT INTERFERE IN ANY WAY WITH OPTIONEE'S RIGHT OR
THE COMPANY'S RIGHT TO TERMINATE OPTIONEE'S EMPLOYMENT OR CONSULTANCY
AT ANY TIME, WITH OR WITHOUT CAUSE AND WITH OR WITHOUT PRIOR NOTICE,
UNLESS THE COMPANY AND THE OPTIONEE HAVE AGREED OTHERWISE IN WRITING.
Optionee acknowledges receipt of a copy of the Plan and represents
that he or she is familiar with the terms and provisions thereof. Optionee
hereby accepts this Option subject to all of the terms and provisions hereof.
Optionee has reviewed the Plan and this Option in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Option, and
fully understands all provisions of the Option. Optionee hereby agrees to accept
as binding, conclusive, and final all decisions or interpretations of the Option
Committee upon any questions arising under the Plan or this Option. Optionee
further agrees to notify the Company upon any change in the residence address
indicated below.
Dated: __________________ ____________________________________
Name: ______________________________
Address: ___________________________
Address: ___________________________
EXHIBIT A
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ARC WIRELESS SOLUTIONS, INC.
2007 STOCK INCENTIVE PLAN
EXERCISE NOTICE
ARC Wireless Solutions, Inc.
Attention: Stock Administration
2.13 Exercise of Option. Effective as of today, ___________, _____,
the undersigned ("Optionee") hereby elects to exercise Optionee's option to
purchase _________ shares of the Common Stock (the "Option Shares") of ARC
Wireless Solutions, Inc. (the "Company") under and pursuant to the Company's
2007 Stock Incentive Plan (the "Plan") and the Stock Option Agreement dated
_____________________ (the "Option Agreement"). Capitalized terms used herein
without definition shall have the meanings given in the Option Agreement.
Date of Grant: ______________________________
Number of Option Shares as to which
Option is Exercised: ______________________________
Exercise Price per Share: $____________
Total Exercise Price: $____________
Certificate to be Issued in Name of: ______________________________
Cash Payment Delivered Herewith: [ ] $____________
Type of Option: [ ] Incentive Stock Option [ ] Non-Qualified Stock Option
2.14 Representations of Optionee. Optionee acknowledges that Optionee
has received, read, and understood the Plan and the Option Agreement. Optionee
agrees to abide by and be bound by their terms and conditions.
2.15 Rights as Shareholder. Until the stock certificate evidencing
such Option Shares is issued (as evidenced by the appropriate entry on the books
of the Company or of a duly authorized transfer agent of the Company), no right
to vote or receive dividends or any other rights as a stockholder shall exist
with respect to Option Shares subject to the Option, notwithstanding the
exercise of the Option. The Company shall issue (or cause to be issued) such
stock certificate promptly after the Option is exercised. No adjustment will be
made for a dividend or other right for which the record date is prior to the
date the stock certificate is issued. Optionee shall enjoy rights as a
shareholder until such time as Optionee disposes of the Option Shares or the
Company. Upon such exercise, Optionee shall have no further rights as a holder
of the Option Shares.
2.16 Tax Consultation. Optionee understands that Optionee may suffer
adverse tax consequences as a result of Optionee's purchase of the Option
Shares. Optionee represents that Optionee has consulted with any tax consultants
Optionee deems advisable in connection with the purchase of the Option Shares
and that Optionee is not relying on the Company for any tax advice.
2.17 Restrictive Legends and Stop-Transfer Orders.
(a) Legends. Optionee understands and agrees that the Company shall
cause the legends set forth below or legends substantially equivalent thereto,
to be placed upon any certificate(s) evidencing ownership of the Option Shares
together with any other legends that may be required by state or federal
securities laws:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED, PLEDGED, OR HYPOTHECATED UNLESS AND UNTIL
REGISTERED UNDER THE ACT OR, IN THE OPINION OF COUNSEL IN FORM AND
SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER,
SALE, TRANSFER, PLEDGE, OR HYPOTHECATION IS IN COMPLIANCE THEREWITH.
(b) Stop-Transfer Notices. Optionee agrees that, in order to ensure
compliance with the restrictions referred to herein, the Company may issue
appropriate "stop transfer" instructions to its transfer agent, if any, and
that, if the Company transfers its own securities, it may make appropriate
notations to the same effect in its own records.
(c) Refusal to Transfer. The Company shall not be required (i) to
transfer on its books any Option Shares that have been sold or otherwise
transferred in violation of any of the provisions of this Agreement or (ii) to
treat as owner of such Option Shares or to accord the right to vote or pay
dividends to any purchaser or other transferee to whom such Option Shares shall
have been so transferred.
2.18 Successors and Assigns. The Company may assign any of its rights
under this Agreement to single or multiple assignees, and this Agreement shall
inure to the benefit of the successors and assigns of the Company. Subject to
the restrictions on transfer herein set forth, this Agreement shall be binding
upon Optionee and his or her heirs, executors, representatives, administrators,
successors, and assigns.
2.19 Interpretation. Any dispute regarding the interpretation of this
Agreement shall be submitted by Optionee or by the Company forthwith to the
Company's Board of Directors or committee thereof that is responsible for the
administration of the Plan (the "Option Committee"), which shall review such
dispute at its next regular meeting. The resolution of such a dispute by the
Option Committee shall be final and binding on the Company and on Optionee.
2.20 Governing Law; Severability. This Agreement shall be governed by
and construed in accordance with the laws of the State of Utah excluding that
body of law pertaining to conflicts of law. Should any provision of this
Agreement be determined by a court of law to be illegal or unenforceable, the
other provisions shall nevertheless remain effective and shall remain
enforceable.
2.21 Notices. Any notice required or permitted hereunder shall be
given in writing and shall be deemed effectively given upon personal delivery or
upon deposit in the United States mail by certified mail, with postage and fees
prepaid, addressed to the other party at its address as shown below beneath its
signature, or to such other address as such party may designate in writing from
time to time to the other party.
2.22 Further Instruments. The parties agree to execute such further
instruments and to take such further action as may be reasonably necessary to
carry out the purposes and intent of this Agreement.
2.23 Delivery of Payment. Optionee herewith delivers to the Company
the full Exercise Price for the Option Shares as set forth above in Section 1,
as well as any applicable withholding tax.
2.24 Entire Agreement. The Plan and Option Agreement are incorporated
herein by reference. This Agreement, the Plan, the Option Agreement, and the
Investment Representation Statement constitute the entire agreement of the
parties and supersede in their entirety all prior undertakings and agreements of
the Company and Optionee with respect to the subject matter hereof.
Accepted by: Submitted by:
ARC WIRELESS SOLUTIONS, INC. OPTIONEE
By:________________________________ ______________________________________
Name:______________________________ Name:_________________________________
Its:_______________________________ Address:______________________________
EXHIBIT B
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INVESTMENT REPRESENTATION STATEMENT
OPTIONEE :
COMPANY : ARC Wireless Solutions, Inc.
SECURITY : Common Stock
AMOUNT :
DATE :
In connection with the purchase of the above-listed shares of Common Stock
(the "Securities") of ARC Wireless Solutions, Inc. (the "Company"), the
undersigned (the "Optionee") represents to the Company the following:
(a) Optionee is aware of the Company's business affairs and financial
condition and has acquired sufficient information about the Company to reach an
informed and knowledgeable decision to acquire the Securities. Optionee is
acquiring these Securities for investment for Optionee's own account only and
not with a view to, or for resale in connection with, any "distribution" thereof
within the meaning of the Securities Act of 1933, as amended (the "Securities
Act").
(b) Optionee acknowledges and understands that the Securities
constitute "restricted securities" under the Securities Act and have not been
registered under the Securities Act in reliance upon a specific exemption
therefrom, which exemption depends upon, among other things, the bona fide
nature of Optionee's investment intent as expressed herein. Optionee understands
that the Securities must be held indefinitely unless they are subsequently
registered under the Securities Act or an exemption from such registration is
available. Optionee further acknowledges and understands that the Company is
under no obligation to register the Securities. Optionee understands that the
certificate evidencing the Securities will be imprinted with a legend that
prohibits the transfer of the Securities unless they are registered or such
registration is not required in the opinion of counsel satisfactory to the
Company and any other legend required under applicable state securities laws.
(c) Optionee is familiar with the provisions of Rule 144 promulgated
under the Securities Act, which, in substance, permits limited public resale of
"restricted securities" acquired, directly or indirectly from the issuer
thereof, in a non-public offering subject to the satisfaction of certain
conditions.
Under Rule 144, the Securities may be resold in certain limited
circumstances subject to the provisions of Rule 144, which requires the resale
to occur not less than one year after the later of the date the Securities were
sold by the Company or the date the Securities were sold by an affiliate of the
Company, within the meaning of Rule 144; and, in the case of acquisition of the
Securities by an affiliate, or by a non-affiliate who subsequently holds the
Securities less than two (2) years, the satisfaction of the following
conditions: (1) the resale being made through a broker in an unsolicited
"broker's transaction" or in transactions directly with a market maker (as said
term is defined under the Securities Exchange Act of 1934); and, in the case of
an affiliate; (2) the availability of certain public information about the
Company; (3) the amount of Securities being sold during any three (3)-month
period not exceeding the limitations specified in Rule 144(e); and (4) the
timely filing of a Form 144, if applicable.
(d) Optionee further understands that in the event all of the
applicable requirements of Rule 144 are not satisfied, registration under the
Securities Act, compliance with Regulation A, or some other registration
exemption will be required; and that, notwithstanding the fact that Rule 144 is
not exclusive, the Staff of the Securities and Exchange Commission has expressed
its opinion that persons proposing to sell private placement securities other
than in a registered offering and otherwise than pursuant to Rules 144 will have
a substantial burden of proof in establishing that an exemption from
registration is available for such offers or sales, and that such persons and
their respective brokers who participate in such transactions do so at their own
risk. Optionee understands that no assurances can be given that any such other
registration exemption will be available in such event.
Signature of Optionee:
Optionee
Date: _______________________, ____