Exhibit 99.05
ONESECURE, INC.
RESTRICTED COMMON STOCK PURCHASE AGREEMENT
TABLE OF CONTENTS
Page
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I. PURCHASE OF SHARES ................................................... 1
1.1 Purchase ........................................................ 1
1.2 Payment ......................................................... 1
1.3 Delivery of Certificates ........................................ 1
1.4 Shareholder Rights .............................................. 1
II. SECURITIES LAW COMPLIANCE ............................................ 1
2.1 Restricted Securities ........................................... 1
2.2 Disposition of Shares ........................................... 2
2.3 Restrictive Legends ............................................. 2
III. SPECIAL TAX PROVISIONS ............................................... 3
3.1 Section 83(b) Election .......................................... 3
3.2 Section 83(b) Election Acknowledgement .......................... 3
3.3 Valuation of Common Stock ....................................... 3
IV. TRANSFER RESTRICTIONS ................................................ 4
4.1 Restriction on Transfer ......................................... 4
4.2 Transferee Obligations .......................................... 4
4.3 Definition of Owner ............................................. 4
4.4 Market Stand-Off Provisions ..................................... 4
V. REPURCHASE RIGHT ..................................................... 5
5.1 Grant ........................................................... 5
5.2 Exercise of the Repurchase Right ................................ 5
5.3 Termination of the Repurchase Right ............................. 6
5.4 Fractional Shares ............................................... 6
5.5 Additional Shares or Substituted Securities ..................... 6
5.6 Corporate Transactions .......................................... 6
VI. RIGHT OF FIRST REFUSAL ............................................... 7
6.1 Grant ........................................................... 7
6.2 Notice of Intended Disposition .................................. 7
6.3 Exercise of Right ............................................... 7
6.4 Non-Exercise of Right ........................................... 7
6.5 Partial Exercise of Right ....................................... 8
6.6 Recapitalization ................................................ 8
6.7 Lapse ........................................................... 8
VII. ESCROW ............................................................... 8
7.1 Deposit ......................................................... 8
7.2 Recapitalization ................................................ 9
7.3 Release/Surrender ............................................... 9
VIII. MARITAL DISSOLUTION OR LEGAL SEPARATION .............................. 10
8.1 Grant ........................................................... 10
8.2 Notice of Decree or Agreement ................................... 10
8.3 Exercise of the Special Purchase Agreement ...................... 10
8.4 Lapse ........................................................... 11
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TABLE OF CONTENTS (continued)
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IX. GENERAL PROVISIONS ................................................. 11
9.1 Assignment ................................................... 11
9.2 Definitions .................................................. 11
9.3 No Employment or Service Contract ............................ 12
9.4 Notices....................................................... 12
9.5 No Waiver .................................................... 12
9.6 Cancellation of Shares ....................................... 12
X. MISCELLANEOUS PROVISIONS ........................................... 12
10.1 Purchaser Undertaking ........................................ 12
10.2 Agreement is Entire Contract ................................. 13
10.3 Governing Law ................................................ 13
10.4 Counterparts ................................................. 13
10.5 Successors and Assigns ....................................... 13
10.6 Amendment and Waiver ......................................... 13
10.7 Arbitration .................................................. 13
EXHIBIT A - ASSIGNMENT SEPARATE FROM CERTIFICATE
EXHIBIT B - SECTION 83(b) TAX ELECTION
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RESTRICTED COMMON STOCK PURCHASE AGREEMENT
AGREEMENT made as of this 18/th/ day of February, 2000, by and between
OneSecure, Inc., a Delaware corporation (the "Company"), and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
("Purchaser").
I. PURCHASE OF SHARES
1.1 Purchase. The Purchaser hereby purchases, and the Company hereby
sells to Purchaser, 5,000,000 shares of the Company's Common Stock (the
"Shares") at a purchase price of $0.0001 per share, or $500.00 in the aggregate
(the "Purchase Price").
1.2 Payment. Concurrently with the execution of this Agreement, the
Purchaser shall deliver to the Corporate Secretary of the Company (i) the
aggregate Purchase Price payable for the Shares in cash, cancellation of
indebtedness or transfer of property and (ii) a duly executed blank Assignment
Separate from Certificate (in the form attached hereto as Exhibit A).
1.3 Delivery of Certificates. The certificates representing the Shares
hereunder shall be held in escrow by the Company as provided in Article VII
hereof.
1.4 Shareholder Rights. Until such time as the Company actually
exercises its repurchase rights or right of first refusal under this Agreement,
Purchaser (or any successor in interest) shall have all the rights of a
shareholder (including voting and dividend rights) with respect to the Shares,
including the Shares held in escrow under Article VII, subject, however, to the
transfer restrictions of Article IV.
II. SECURITIES LAW COMPLIANCE
2.1 Restricted Securities.
(a) Purchaser hereby confirms that Purchaser has been informed
that the Shares are restricted securities under the Securities Act of 1933, as
amended ("1933 Act"), and may not be resold or transferred unless the Shares are
first registered under the federal securities laws or unless an exemption from
such registration is available. Accordingly, Purchaser hereby acknowledges that
Purchaser is prepared to hold the Shares for an indefinite period and that
Purchaser is aware that Rule 144 of the Securities and Exchange Commission
("SEC") issued under the 1933 Act is not presently available to exempt the sale
of the Shares from the registration requirements of the 1933 Act.
(b) Upon the expiration of the ninety (90)-day period immediately
following the date on which the Company first becomes subject to the reporting
requirements of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), the Shares, to the extent vested under Article V, may be sold (without
registration) pursuant to the applicable requirements of Rule 144. If Purchaser
is at the time of such sale an affiliate of the Company for purposes of Rule 144
or was such an affiliate during the preceding three (3) months, then the sale
must comply with all the requirements of Rule 144 (including the volume
limitation on the number of shares sold, the broker/market-maker sale
requirement and the requisite notice to the
SEC); however, the one-year holding period requirement of the Rule will not be
applicable. If Purchaser is not at the time of the sale an affiliate of the
Company nor was such an affiliate during the preceding three (3) months, then
none of the requirements of Rule 144 (other than the broker/market-maker sale
requirement for Shares held for fewer than two (2) years following payment in
cash of the Purchase Price therefor) will be applicable to the sale. The
requirements of Rule 144 are subject to change at any time.
(c) Should the Company not become subject to the reporting
requirements of the Exchange Act, then Purchaser may, provided he is not at the
time an affiliate of the Company (nor was such an affiliate during the preceding
three (3) months), sell the Shares (without registration) pursuant to paragraph
(k) of Rule 144 after the Shares have been held for a period of two (2) years
following the payment in cash of the Purchase Price for such shares.
2.2 Disposition of Shares. Subject to the terms of this Agreement,
Purchaser hereby agrees that Purchaser shall make no disposition of the Shares
(other than a permitted transfer under paragraph 4.1) unless and until there is
compliance with all of the following requirements:
(a) Purchaser shall have notified the Company of the proposed
disposition and provided a written summary of the terms and conditions of the
proposed disposition;
(b) Purchaser shall have complied with all requirements of this
Agreement applicable to the disposition of the Shares,
(c) Purchaser shall have provided the Company with written
assurances, in form and substance satisfactory to the Company, that (i) the
proposed disposition does not require registration of the Shares under the 1933
Act or (ii) all appropriate action necessary for compliance with the
registration requirements of the 1933 Act or of any exemption from registration
available under the 1933 Act (including Rule 144) has been taken; and
(d) Purchaser shall have provided the Company with written
assurances, in form and substance satisfactory to the Company, that the proposed
disposition wil1 not result in the contravention of any transfer restrictions
applicable to the Shares.
The Company shall not be required (i) to transfer on its books any
Shares which have been sold or transferred in violation of the provisions of
this Article II nor (ii) to treat as the owner of the Shares, or otherwise to
accord voting or dividend rights to, any transferee to whom the Shares have been
transferred in contravention of this Agreement.
2.3 Restrictive Legends. In order to reflect the restrictions on
disposition of the Shares, the stock certificates for the Shares will be
endorsed with restrictive legends, including one or more of the following
legends:
(a) "The shares represented by this certificate have not been
registered under the Securities Act of 1933, as amended. The shares may not be
sold or offered for sale in the absence of (1) an effective registration
statement for the shares under such Act, (2) a 'no action' letter of the SEC
with respect to such sale or offer, or (3) satisfactory assurances to the
Company that registration under such Act is not required with respect to such
sale or offer."
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(b) "All of the shares represented by this certificate are
unvested and accordingly may not be sold, assigned, transferred, encumbered, or
in any manner disposed of except in conformity with the terms of a written
agreement between the Company and the registered holder of the shares (or the
predecessor in interest to the shares). Such agreement grants certain repurchase
rights and rights of first refusal to the Company (or its assignees) upon the
sale, assignment, transfer, encumbrance or other disposition of the Company's
shares or upon termination of service with the Company. The Company will upon
written request furnish a copy of such agreement to the holder hereof without
charge."
III. SPECIAL TAX PROVISIONS
3.1 Section 83(b) Election. The Purchaser understands that under
Section 83 of the Internal Revenue Code of 1986, as amended (the "Code"), the
excess of the fair market value of the Shares on the date any forfeiture
restrictions applicable to such shares lapse over the Purchase Price for such
Shares will be reportable as ordinary income on such lapse date. For this
purpose, the term "forfeiture restrictions" includes the right of the Company to
repurchase the Shares pursuant to the Repurchase Rights (as defined) provided
under this Agreement. Purchaser understands that he may elect under Section
83(b) of the Code to be taxed at the time the Shares are acquired hereunder,
rather than when and as such Shares cease to be subject to such forfeiture
restrictions. Such election must be filed with the Internal Revenue Service
within thirty (30) days after the date of this Agreement. Even if the fair
market value of the Shares on the date of this Agreement equals the Purchase
Price paid (and thus no tax is payable), the election must be made to avoid
adverse tax consequences in the future. The form for making this election is
attached as Exhibit B hereto. Purchaser understands that failure to make this
filing within the thirty (30) day period will result in the recognition of
ordinary income by the Purchaser as and each time the forfeiture restrictions
lapse.
3.2 Section 83(b) Election Acknowledgement. PURCHASER ACKNOWLEDGES
THAT IT IS PURCHASER'S SOLE RESPONSIBILITY, AND NOT THE COMPANY'S, TO FILE A
TIMELY ELECTION UNDER SECTION 83(b), EVEN IF PURCHASER REQUESTS THE COMPANY OR
ITS REPRESENTATIVES TO MAKE THIS FILING ON HIS BEHALF. This filing should be
made by registered or certified mail, return receipt requested, and Purchaser
must retain two (2) copies of the completed form for filing with his State and
Federal tax returns for the current tax year and an additional copy for his
personal records.
3.3 Valuation of Common Stock. Purchaser understands that the Shares
have been valued by the Board of Directors and that the Company believes this
valuation represents a fair attempt at reaching an accurate appraisal of their
worth; Purchaser understands, however, that the Company can give no assurances
that such price is in fact the fair market value of the Shares and that it is
possible that, with the benefit of hindsight, the Internal Revenue Service would
successfully assert that the value of the Shares on the date of purchase is
substantially greater than so determined.
If the Internal Revenue Service were to succeed in a tax
determination that the Shares received had value greater than that upon which
the transaction was based, the additional value would constitute ordinary income
as of the date of its receipt. The additional taxes (and interest) due would be
payable by Purchaser, and there is no provision for the Company to
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reimburse him for that tax liability, and Purchaser assumes all responsibility
for such potential tax liability. In the event that such additional value would
represent more than 25 percent of Purchaser's gross income for the year in which
the value of the Shares was taxable, the Internal Revenue Service would have six
years from the due date for filing the return (or the actual filing date of the
return if filed thereafter) within which to assess Purchaser the additional tax
and interest which would then be due.
The Company would have to benefit, in any such transaction, if a
determination was made prior to the three year statute of limitations period
affecting the Company, of an increase in its deduction for compensation paid,
which would offset its operating profits, or, if not profitable, would create
net operating loss carry forward arising from operations in that year.
IV. TRANSFER RESTRICTIONS
4.1 Restriction on Transfer. Purchaser shall not transfer, assign,
encumber or otherwise dispose of any of the Shares which are subject to the
Company's Repurchase Rights in this Agreement. In addition, Shares which are
released from the Repurchase Rights shall not be transferred, assigned,
encumbered or otherwise made the subject of disposition in contravention of the
Company's First Refusal Right under Article VI or as otherwise limited herein.
Such restrictions on transfer, however, shall not be applicable to (i) a
gratuitous transfer of the Shares made to the Purchaser's spouse or issue,
including adopted children, or to a trust for the exclusive benefit of the
Purchaser or the Purchaser's spouse or issue, provided and only if the Purchaser
obtains the Company's prior written consent to such transfer and such transferee
agrees to be bound by the terms of this Agreement, (ii) a transfer of title to
the Shares effected pursuant to the Purchaser's will or the laws of intestate
succession or (iii) a transfer to the Company in pledge as security for any
purchase money indebtedness incurred by the Purchaser in connection with the
acquisition of the Shares.
4.2 Transferee Obligations. Each person (other than the Company) to whom
the Shares are transferred by means of one of the permitted transfers specified
in paragraph 4.1 must, as a condition precedent to the validity of such
transfer, acknowledge in writing to the Company that such person is bound by the
provisions of this Agreement and that the transferred shares are subject to (i)
both the Company's Repurchase Rights and the Company's First Refusal Right
granted hereunder and (ii) the market stand-off provisions of paragraph 4.4, to
the same extent such Shares would be so subject if retained by the Purchaser.
4.3 Definition of Owner. For purposes of this Agreement, the term "Owner"
shall include the Purchaser and all subsequent holders of the Shares who derive
their chain of ownership through a permitted transfer from the Purchaser in
accordance with paragraph 4.1.
4.4 Market Stand-Off Provisions.
(a) In connection with the first underwritten public offering by the
Company of its equity securities pursuant to an effective registration statement
filed under the 1933 Act, Owner shall not sell, make any short sale of, loan,
hypothecate, pledge, grant any option for the purchase of, or otherwise dispose
or transfer for value or otherwise agree to engage in any of the foregoing
transactions with respect to, any Shares without the prior written consent of
the
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Company or its underwriters. Such limitations shall be in effect for such period
of time from and after the effective date of such registration statement as may
be requested by the Company or such underwriters; provided, however, that in no
event shall such period exceed one hundred-eighty (180) days.
(b) Owner shall be subject to the market stand-off provisions
of this paragraph 4.4 provided and only if the executive officers and directors
of the Company are also subject to similar arrangements.
(c) In the event of any stock dividend, stock split,
recapitalization or other change affecting the Company's outstanding Common
Stock effected without receipt of consideration, then any new, substituted or
additional securities distributed with respect to the Shares shall be
immediately subject to the provisions of this paragraph 4.4, so the same extent
the Shares are at such time covered by such provisions.
(d) In order to enforce the limitations of this paragraph 4.4,
the Company may impose stop-transfer instructions with respect to the Shares
until the end of the applicable stand-off period.
V. REPURCHASE RIGHT
5.1 Grant. The Company (or its assignees) is hereby granted the
right (the "Repurchase Right"), exercisable at any time during the sixty
(60)-day period following the date the Purchaser ceases for any reason to remain
in Service or (if later) during the sixty (60)-day period following the
execution date of this Agreement to repurchase at the Purchase Price all or (at
the discretion of the Company) any portion of the Shares in which the Purchaser
has not acquired a vested interest in accordance with the vesting provisions of
this Article V (such shares to be hereinafter called the "Unvested Shares"). For
purposes of this Agreement, the Purchaser shall be deemed to remain in Service
for so long as the Purchaser continues to actually and physically render
services on a full time basis to the Company or any parent or subsidiary
corporation, whether as an employee, a non-employee member of the board of
directors, or an independent contractor or consultant, solely as determined by
and in accordance with the directives of the Board of Directors of the Company.
By executing this Agreement, Purchaser agrees to abide by such Board
determination.
5.2 Exercise of the Repurchase Right. The Repurchase Right shall be
exercisable by written notice delivered to the Owner of the Unvested Shares
prior to the expiration of the applicable sixty (60)-day period specified in
paragraph 5.1. The notice shall indicate the number of Unvested Shares to be
repurchased and the date on which the repurchase is to be effected, such date to
be not more than thirty (30) days after the date of notice. To the extent one or
more certificates representing Unvested Shares may have been previously
delivered out of escrow to the Owner, then Owner shall, prior to the close of
business on the date specified for the repurchase, deliver to the Secretary of
the Company the certificates representing the Unvested Shares to be repurchased,
each certificate to be properly endorsed for transfer. The Company shall,
concurrently with the receipt of such stock certificates (either from escrow in
accordance or from Owner as herein provided), pay to Owner in cash or cash
equivalents (including the
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cancellation of any purchase-money indebtedness), an amount equal to the per
Share Purchase Price previously paid for the Unvested Shares which are to be
repurchased.
5.3 Termination of the Repurchase Right. The Repurchase Right shall
terminate with respect to any Unvested Shares for which it is not timely
exercised under paragraph 5.2. In addition, the Repurchase Right as to certain
Unvested Shares shall terminate, and cease to be exercisable, solely to the
extent set forth below, on the earliest to occur of (i) upon the occurrence of
either of the Corporate Transactions defined in Section 5.6 hereof, or (ii) with
respect to any and all Shares in which the Purchaser vests in accordance with
the schedule set forth in this Section 5.3. Accordingly, as, and provided that,
the Purchaser continues in continuous Service, as defined above, or upon the
occurrence of any Corporate Transaction, the Purchaser shall acquire a vested
interest in, and the Repurchase Right as to certain Unvested Shares, solely to
the extent set forth below, shall lapse with respect to, the Shares as follows:
the Purchaser shall acquire a vested interest in, and the Repurchase Right shall
lapse with respect to, fifty percent (50%) of the Shares upon the first issuance
by the Company of its Series A Preferred Stock (the "First Closing"), and with
respect to the remainder of the Shares in thirty-six equal and continuous
monthly installments for each monthly period of continuous service from the date
hereof for the thirty-six months following the date hereof, such that, if the
First Closing shall have occurred, the Purchaser shall be fully vested in all
Shares after three full years of continuous service completed by the Purchaser
following the date hereof. All Shares as to which the Repurchase Right lapses
shall, however, continue to be subject to the First Refusal Right until the
lapse of such First Refusal Right, the market stand-off provisions of paragraph
4.4 and the Special Purchase Rights set forth under Article VIII.
5.4 Fractional Shares. No fractional shares shall be repurchased by the
Company. Accordingly, should the Repurchase Right extend to a fractional share
(in accordance with the vesting computation provisions of paragraph 5.3 and 5.6)
at the time the Purchaser ceases Service or pursuant hereto, then such
fractional share shall be added to any fractional share in which the Purchaser
is at such time vested in order to make one whole vested share no longer subject
to the Repurchase Right.
5.5 Additional Shares or Substituted Securities. In the event of any stock
dividend, stock split, recapitalization or other change affecting the Company's
outstanding Common Stock as a class effected without receipt of consideration,
then any new, substituted or additional securities or other property (including
money paid other than as a regular cash dividend) which is by reason of any such
transaction distributed with respect to the Shares shall be immediately subject
to the Repurchase Right, but only to the extent the Shares are at the time
covered by such right. Appropriate adjustments to reflect the distribution of
such securities or property shall be made to the number of Shares at the time
subject to the Repurchase Right hereunder and to the price per share to be paid
upon the exercise of the Repurchase Right in order to reflect the effect of any
such transaction under the Company's capital structure; provided, however, that
the aggregate Purchase Price shall remain the same.
5.6 Corporate Transaction. If, after the consummation of either of the
following transaction (each a "Corporate Transaction"):
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(a) a merger or consolidation of the Company, in which the
shareholders of the Company do not control a majority of the total voting power
of the surviving entity (other than a reincorporation merger); or
(b) the sale, transfer or other disposition of all or substantially
all of the Company's assets in liquidation or dissolution of the Company,
the Purchaser is terminated without Cause by the Company or leaves the Company
for Good Reason, then the Repurchase Rights of the Company shall lapse with
respect to all of the Unvested Shares and Purchaser shall acquire a vested
interest in all of the Shares as of the date on which Purchaser's employment
with the Company ends.
VI. RIGHT OF FIRST REFUSAL
6.1 Grant. The Company is hereby granted the right of first refusal (the
"First Refusal Right"), exercisable in connection with any proposed transfer of
the Shares. For purposes of this Article VI, the term "transfer" shall include
any sale, assignment, pledge, encumbrance or other disposition for value of the
Shares intended to be made by the Owner, but shall exclude any of the permitted
transfers under paragraph 4.1.
6.2 Notice of Intended Disposition. In the event the Owner desires to
accept a bona fide third-party offer for any or all of the Shares (the shares
subject to such offer to be hereinafter called the "Target Shares"), Owner shall
promptly (i) deliver to the Corporate Secretary of the Company written notice
(the "Disposition Notice") of the terms and conditions of the offer, including
the purchase price and the identity of the third-party offeror and (ii) provide
satisfactory proof that the disposition of the Target Shares to such third-party
offeror would not be in contravention of the provisions set forth in Articles II
and IV of this Agreement.
6.3 Exercise of Right. The Company (or its assignees) shall, for a period
of twenty-five (25) days following receipt of the Disposition Notice, have the
right to repurchase any or all of the Target Shares specified in the Disposition
Notice upon substantially the same terms and conditions specified therein. Such
right shall be exercisable by delivery of written notice (the "Exercise Notice")
to Owner prior to the expiration of the twenty-five (25) day exercise period. If
such right is exercised with respect to all the Target Shares specified in the
Disposition Notice, then the Company (or its assignees) shall effect the
repurchase of the Target Shares, including payment of the purchase price, not
more than five (5) business days after delivery of the Exercise Notice; and at
such time Owner shall deliver to the Company the certificates representing the
Target Shares to be repurchased, each certificate to be properly endorsed for
transfer. To the extent any of the Target Shares are at the time held in escrow
under Article VII, the certificates for such shares shall automatically be
released from escrow and delivered to the Company for purchase.
6.4 Non-Exercise of Right. In the event the Exercise Notice is not given
to Owner within twenty-five (25) days following the date of the Company's
receipt of the Disposition Notice, Owner shall have a period of thirty (30) days
thereafter in which to sell or otherwise dispose of the Target Shares to the
third-party offeror identified in the Disposition Notice upon terms and
conditions (including the purchase price) no more favorable to such third-party
offeror
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than those specified in the Disposition Notice; provided, however, that any such
sale or disposition must not be effected in contravention of the provisions of
Article II of this Agreement. To the extent any of the Target Shares are at the
time held in escrow under Article VII, the certificates for such shares shall
automatically be released from escrow and surrendered to the Owner. The
third-party offeror shall acquire the Target Shares free and clear of the
Company's Repurchase Right under Article V, but the acquired shares shall remain
subject to (i) the securities law restrictions of paragraph 2.2(a), (ii) the
market stand-off provisions of paragraph 4.4, (iii) the Company's First Refusal
Rights hereunder and (iv) Article VIII.
6.5 Partial Exercise of Right. In the event the Company (or its assignees)
makes a timely exercise of the First Refusal Right with respect to a portion,
but not all, of the Target Shares specified in the Disposition Notice, Owner
shall have the option, exercisable by written notice to the Company delivered
within thirty (30) days after the date of the Disposition Notice, to effect the
sale of the Target Shares pursuant to one of the following alternatives:
(a) sale or other disposition of all the Target Shares to the
third-party offeror identified in the Disposition Notice, but in full compliance
with the requirements of paragraph 6.4, as if the Company did not exercise the
First Refusal Right hereunder; or
(b) sale to the Company (or its assignees) of the portion of the
Target Shares which the Company (or its assignees) has elected to purchase, such
sale to be effected in substantial conformity with the provisions of paragraph
6.3.
Failure of Owner to deliver timely notification to the Company under
this paragraph 6.5 shall be deemed to be an election by Owner to sell the Target
Shares pursuant to alternative (a) above.
6.6 Recapitalization. In the event of any stock dividend, stock split,
recapitalization or other transaction affecting the Company's outstanding Common
Stock as a class effected without receipt of consideration, then any new,
substituted or additional securities or other property which is by reason of
such transaction distributed with respect to the Shares shall be immediately
subject to the Company's First Refusal Right hereunder, but only to the extent
the Shares are at the time covered by such right.
6.7 Lapse. The First Refusal Right under this Article VI shall remain in
effect under all circumstances but shall lapse and cease to have effect upon the
earliest to occur of (i) the first date on which shares of the Company's Common
Stock are held of record by more than five hundred (500) persons, (ii) a
determination is made by the Company's Board of Directors that a public market
exists for the outstanding shares of the Company's Common Stock or (iii) an
underwritten public offering pursuant to an effective registration statement
under the 1933 Act. However, the market stand-off provisions of paragraph 4.4
shall continue to remain in full force and effect following the lapse of the
First Refusal Right hereunder.
VII. ESCROW
7.1 Deposit. Upon issuance, the certificates for any Unvested Shares
purchased hereunder shall be deposited in escrow with the Company to be held in
accordance with the provisions of this Article VII. Each deposited certificate
shall be accompanied by a duly
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executed Assignment Separate from Certificate in the form of Exhibit A. The
deposited certificates, together with any other assets or securities from time
to time deposited with the Company pursuant to the requirements of this
Agreement, shall remain in escrow until such time or times as the certificates
(or other assets and securities) are to be released or otherwise surrendered for
cancellation in accordance with paragraph 7.3. Upon delivery of the certificates
(or other assets and securities) to the Company, the Owner shall be issued an
instrument of deposit acknowledging the number of Unvested Shares (or other
assets and securities) delivered in escrow to the Company.
7.2 Recapitalization. All regular cash dividends on the Unvested Shares
(or other securities at the time held in escrow) shall be paid directly to the
Owner and shall not be held in escrow. However, in the event of any stock
dividend, stock split, recapitalization or other change affecting the Company's
outstanding Common Stock as a class effected without receipt of consideration or
in the event of a Corporate Transaction, any new, substituted or additional
securities or other property which is by reason of such transaction distributed
with respect to the Unvested Shares shall be immediately delivered to the
Company to be held in escrow under this Article VII, but only to the extent the
Unvested Shares are at the time subject to the escrow requirements of paragraph
7.1.
7.3 Release/Surrender. The Unvested Shares, together with any other assets
or securities held in escrow hereunder, shall be subject to the following terms
and conditions relating to their release from escrow of their surrender to the
Company for repurchase and cancellation:
(a) Should the Company (or its assignees) elect to exercise the
Repurchase Right under Article V with respect to any Unvested Shares, then the
escrowed certificates for such Unvested Shares (together with any other assets
or securities issued with respect thereto) shall be delivered to the Company,
concurrently with the payment to the Owner, in cash or cash equivalent
(including the cancellation of any purchase-money indebtedness), of an amount
equal to the aggregate Purchase Price for such Unvested Shares, and the Owner
shall cease to have any further rights or claims with respect to such Unvested
Shares (or other assets or securities attributable to such Unvested Shares).
(b) Should the Company (or its assignees) elect to exercise its First
Refusal Right under Article VI with respect to any vested Target Shares held at
the time in escrow hereunder, then the escrowed certificates for such Target
Shares (together with any other assets or securities attributable thereto)
shall, concurrently with the payment of the paragraph 6.3 purchase price for
such Target Shares to the Owner, be surrendered to the Company, and the Owner
shall cease to have any further rights or claims with respect to such Target
Shares (or other assets or securities).
(c) Should the Company (or its assignees) elect not to exercise its
First Refusal Right under Article VI with respect to any Target Shares held at
the time in escrow hereunder, then the escrowed certificates for such Target
Shares (together with any other assets or securities attributable thereto) shall
be surrendered to the Owner for disposition in accordance with the provisions of
paragraph 6.4.
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(d) As the interest of the Owner in the Unvested Shares
(or any other assets or securities attributable thereto) vests in
accordance with the provisions of Article V, the certificates for such
vested shares (as well as all other vested assets and securities) shall
be released from escrow and delivered to the Owner in accordance with the
following schedule:
(1) Upon the Purchaser's cessation of Service,
any escrowed Shares (or other assets or securities) in which the
Purchaser is at the time vested shall be promptly released from escrow.
(2) Upon any earlier termination of the Company's
Repurchase Right in accordance with the applicable provisions of Article
V, the Shares (or other assets or securities) at the time held in escrow
hereunder shall promptly be released to the Owner as fully-vested shares
or other property.
(3) All Shares (or other assets or securities)
released from escrow in accordance with the provisions of subparagraph
(2) above shall nevertheless remain subject to (i) the Company's First
Refusal Right under Article VI until such right lapses pursuant to
paragraph 6.7 and Article III and (ii) the market stand-off provisions of
paragraph 4.4. until such provisions terminate in accordance therewith.
VIII. MARITAL DISSOLUTION OR LEGAL SEPARATION
8.1 Grant. Notwithstanding anything in this Agreement to the
contrary, in connection with the dissolution of Owner's marriage or the
legal separation of Owner and Owner's spouse, the Company shall have the
right (the "Special Purchase Right") to purchase from Optionee's spouse,
in accordance with the provisions of this Article VIII, all or any
portion of the Shares which would otherwise be awarded to such spouse in
settlement of any community property or other marital property rights
such spouse may have in such shares.
8.2 Notice of Decree or Agreement. Owner shall promptly provide
the Company with written notice (the "Dissolution Notice") of (i) the
entry of any judicial decree or order resolving the property rights of
Owner and Owner's spouse in connection with their marital dissolution or
legal separation or (ii) the execution of any contract or agreement
relating to the distribution or division of such property rights. The
Dissolution Notice shall be accompanied by a copy of the actual decree or
order of dissolution or contract or agreement between Owner and Owner's
spouse which provides for the award to the spouse of one or more Shares
in settlement of any community property or other marital property rights
such spouse may have in such shares.
8.3 Exercise of the Special Purchase Right. The Special
Purchase Right shall be exercisable by delivery of written notice (the
"Purchase Notice") to Owner and Owner's spouse within forty-five (45)
days after the Company's receipt of the Dissolution Notice. The Purchase
Notice shall indicate the number of Shares to be purchased by the
Company, the date such purchase is to be effected (such date to be not
less than five (5) business days, nor more than fifteen (15) business
days, after the date of the Purchase Notice) and the fair market value to
be paid for such Shares. Owner (or Owner's spouse, to the extent such
spouse has physical possession of the Shares) shall, prior to the close
of business on the date specified for the purchase, deliver to the
Company the certificates representing the shares to be purchased. The
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Company shall, concurrently with the receipt of the stock certificates,
pay to Owner's spouse (in cash or cash equivalents) an amount equal to
the fair market value specified for such shares in the Purchase Notice.
If Owner's spouse does not agree with the fair market value
specified for the Shares in the Purchase Notice, then the spouse shall
promptly notify the Company in writing of such disagreement and the fair
market value of such Shares shall thereupon be determined by an appraiser
of recognized standing selected by the Company and the spouse. If they
cannot agree on an appraiser within fifteen (15) days after the date of
the Purchase Notice, each shall select an appraiser of recognized
standing, and the two (2) appraisers shall designate a third appraiser of
recognized standing whose appraisal shall be determinative of such value.
The cost of the appraisal shall be shared equally by the Company and
Owner's spouse. The closing shall then be held on the fifteenth (15th)
business day following the completion of such appraisal; provided,
however, that if the appraised value is more than twenty-five percent
(25%) greater than the fair market value specified for the Shares in the
Purchase Notice, the Company shall have the right, exercisable prior to
the expiration of such fifteen (15) business-day period, to rescind the
exercise of the Special Purchase Right and thereby revoke its election to
purchase the Shares awarded to the spouse.
8.4 Lapse. The Special Purchase Right shall lapse upon the
earlier to occur of (i) the lapse of the First Refusal Right or (ii) the
expiration of the exercise period specified in this Article VIII, to the
extent the Special Purchase Right is not timely exercised in accordance
with such paragraph.
IX. GENERAL PROVISIONS
9.1 Assignment. The Company may assign its Repurchase Right
Under Article V and/or its First Refusal Right under Article VI and/or
its Special Purchase Rights under Article VIII to any person or entity
selected by the Company's Board of Directors, including (without
limitation) one or more shareholders of the Company.
If the assignee is other than a parent or subsidiary
corporation of the Company, then such assignee must make a cash payment
to the Company, upon the assignment of the Repurchase Right, in an amount
equal to the excess (if any) of (i) the fair market value of the Unvested
Shares at the time subject to the assigned Repurchase Right over (ii) the
aggregate repurchase price payable for Unvested Shares thereunder.
9.2 Definitions. For purposes of this Agreement, the following
provisions shall be applicable in determining the parent and subsidiary
corporations of the Company:
(a) Any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company shall be
considered to be a parent corporation of the Company, provided each such
corporation in the unbroken chain (other than the Company) owns, at the
time of the determination, stock possessing fifty percent (50%) or more
of the total combined voting power of all classes of stock in one of the
other corporations in such chain.
(b) Each corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company shall be
considered to be a subsidiary of the
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Company, provided each such corporation (other than the last corporation)
in the unbroken chain owns, at the time of the determination, stock
possessing fifty percent (50%) or more of the total combined voting power
of all classes of stock in one of the other corporations in such chain.
9.3 No Employment or Service Contract. Subject to the terms of
the Employment Agreement, nothing in this Agreement shall confer upon the
Purchaser any right to continue in the Service of the Company (or any
parent or subsidiary corporation employing or retaining Purchaser) for
any period of specific duration or interfere with or otherwise restrict
in any way the rights of the Company (or any parent or subsidiary
corporation employing or retaining Purchaser) or the Purchaser, which
rights are hereby expressly reserved by each, to terminate the
Purchaser's Service at any time for any reason whatsoever, with or
without cause.
9.4 Notices. Any notice required in connection with (i) the
Repurchase Rights or the First Refusal Right or (ii) the disposition of
any Shares covered thereby shall be given in writing and shall be deemed
effective upon personal delivery or upon deposit in the United States
mail, registered or certified, postage prepaid and addressed to the party
entitled to such notice at the address indicated below such party's
signature line on this Agreement or at such other address as such party
may designate by ten (10) days advance written notice under this
paragraph 9.4 to all other parties to this Agreement.
9.5 No Waiver. The failure of the Company (or its assignees) in
any instance to exercise the Repurchase Right granted under Article V or
VIII or the failure of the Company (or its assignees) in any instance to
exercise the First Refusal Right granted under Article VI shall not
constitute a waiver of any other repurchase right and/or right of first
refusal that may subsequently arise under the provisions of this
Agreement or any other agreement between the Company and the Purchaser or
the Purchaser's spouse. No waiver of any breach or condition of this
Agreement shall be deemed to be a waiver of any other or subsequent
breach or condition, whether of like or different nature.
9.6 Cancellation of Shares. If the Company (or its assignees)
shall make available, at the time and place and in the amount and form
provided in this Agreement, the consideration for the Shares to be
repurchased in accordance with the provisions of this Agreement, then
from and after such time, the person from whom such shares are to be
repurchased shall no longer have any rights as a holder of such shares
(other than the right to receive payment of such consideration in
accordance with this Agreement), and such shares shall be deemed
purchased in accordance with the applicable provisions hereof and the
Company (or its assignees) shall be deemed the owner and holder of such
shares, whether or not the certificates therefor have been delivered as
required by this Agreement.
X. MISCELLANEOUS PROVISIONS
10.1 Purchaser Undertaking. Purchaser hereby agrees to take
whatever additional action and execute whatever additional documents the
Company may in its judgment deem necessary or advisable in order to carry
out or effect one or more of the obligations or restrictions imposed on
either the Purchaser or the Shares pursuant to the express provisions of
this Agreement.
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10.2 Agreement is Entire Contract. This Agreement constitutes
the entire contract between the parties hereto with regard to the subject
matter hereof.
10.3 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of California, as
such laws are applied to contracts entered into and performed in such
State without resort to that State's conflict-of-laws rules.
10.4 Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original, but all of
which together shall constitute one and the same instrument.
10.5 Successors and Assigns. The provisions of this Agreement
shall inure to the benefit of, and be binding upon, the Company and its
successors and assigns and the Purchaser and the Purchaser's legal
representatives, heirs, legatees, distributees, assigns and transferees
by operation of law, whether or not any such person shall have become a
party to this Agreement and have agreed in writing to join herein and be
bound by the terms and conditions hereof.
10.6 Amendment and Waiver. This Agreement shall not be amended
nor any Section hereof waived by the Company in the absence of approval
of such amendment or waiver by a majority of the Company's Board of
Directors.
10.7 Arbitration. Any controversy between the parties hereto
involving any claim arising out of or relating to this Agreement shall be
finally settled by arbitration in San Francisco, California, in
accordance with the then current Commercial Arbitration Rules of the
American Arbitration Association, and judgment upon the award rendered by
the arbitrators may be entered in any court having jurisdiction thereof.
The parties acknowledge that ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP represents
the Company in the review of this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the day
and year first indicated above.
THE COMPANY:
OneSecure, Inc.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
Adress:
PURCHASER:
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Adress:
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CONSENT OF SPOUSE
I acknowledge that I have read the foregoing Restricted Common Stock
Purchase Agreement and that I know its contents. I hereby agree that those
shares and my interest in them, if any, are subject to the provisions of the
Restricted Common Stock Purchase Agreement and that I will take no action at any
time to hinder operations of or violate the Restricted Common Stock Purchase
Agreement.
___________________________________
(Signature of Shareholder's Spouse)
EXHIBIT A
ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED, _____________ hereby sell(s), assign(s) and
transfer(s) unto OneSecure, Inc. (the "Company") ______________ (_____________)
shares of the Common Stock of the Company standing in ____________ name on the
books of the Company represented by Certificate No. _______ herewith and do
hereby irrevocably constitute and appoint ________________ Attorney to transfer
the said stock on the books of the Company with full power of substitution in
the premises.
Dated: _____________________
Signature /s/ [ILLEGIBLE]
-----------------------
Instruction: Please do not fill in any blanks other than the signature line. The
purpose of this assignment is to enable the Company to exercise its rights as
set forth in the Agreement without requiring additional signatures on the part
of the Purchaser.