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EXHIBIT 4.5
GAMEFX, INC.
1997 STOCK OPTION PLAN
AMENDED AND RESTATED
NOTICE OF STOCK OPTION GRANT
__________________
__________________
__________________
You have been granted an option, consisting of the Stock Option
Agreement attached hereto as EXHIBIT A and this Notice of Stock Option Grant
(together, the "Option") to purchase Common Stock of GameFx, Inc., (the
"Company") as follows:
Date of Grant _________________________________
Vesting Commencement Date _________________________________
Option Price Per Share _________________________________
Total Number of Shares Granted _________________________________
Total Price of Shares Granted _________________________________
Type of Option ___ Incentive Stock Option
___ Nonqualified Stock Option
Term/Expiration Date _________________________________
Exercise Schedule:
This option may be exercised in whole or in part, in accordance with the
Vesting Schedule set out below.
Vesting Schedule
This option shall vest and become exercisable over a four year period with
25% (________) of the total number of Shares vesting on the first annual
anniversary of the Vesting Commencement Date.
Thereafter, monthly on the last day of each month, 1/36 (_______) of the
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remaining number of Shares shall vest and become exercisable until fully
vested. In the event of fractional Shares, the monthly number of Shares
shall be adjusted accordingly to the nearest whole Share.
Termination Period:
This option may be exercised for 90 days after termination of employment or
consulting relationship except as set out in Sections 7 and 8 of the Stock
Option Agreement (but in no event later than the Expiration Date).
Exercise of this Option requires the execution and delivery by Optionee of the
Exercise Notice for Vested Shares attached hereto as Exhibit B and each of the
other documents referred to therein.
OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO
THIS OPTION 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 1997 STOCK OPTION 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 HIS RIGHT OR THE COMPANY'S RIGHT TO TERMINATE HIS
EMPLOYMENT OR CONSULTANCY AT ANY TIME, WITH OR WITHOUT CAUSE.
Optionee acknowledges receipt of a copy of the Company's 1997 Stock Option
Plan (the "Plan"), each of Exhibits A, B, C and D hereto and the GameFx
Information Statement Describing the Transactions with Electronic Arts Inc.
dated October 1, 1997 (the "Description of Transactions with EA"), and
represents that he or she is familiar with the terms and provisions of the
Plan, this Option, and such Exhibits. Optionee accepts this Option subject to
all such terms and provisions. Optionee has reviewed the Plan, this Option and
the Description of Transactions with EA 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.
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 the Plan and the Stock Option Agreement, and the other
Exhibits hereto, all of which are attached and made a part of this document.
OPTIONEE: GAMEFX, INC.,
a Delaware corporation
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--------------------------------- By
Signature ---------------------------------
--------------------------------- Title
Print Name ------------------------------
CONSENT OF SPOUSE
The undersigned spouse of _________________ has read and hereby approves
the terms and conditions of the Plan and this Option. In consideration of the
Company's granting his or her spouse the right to purchase Shares as set forth
in the Plan and this Option, the undersigned hereby agrees to be irrevocably
bound by the terms and conditions of the Plan and this Option 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 the Plan or this
Option.
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Spouse of Optionee
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EXHIBIT A TO NOTICE OF ▇▇▇▇▇
STOCK OPTION AGREEMENT
1. Grant of Option. GameFx, Inc., a Delaware corporation (the
"Company"), hereby grants to the person (the "Optionee") named in the Notice of
Grant, an option (the "Option") to purchase a 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, conditions and definitions
of the 1997 Stock Option Plan (the "Plan") adopted by the Company, which is
incorporated herein by reference. In the event of a conflict between the terms
and conditions of the Plan and the terms and conditions of this Option
Agreement, the terms and conditions of the Plan shall prevail. Unless otherwise
defined herein, the terms defined in the Plan shall have the same defined
meanings in this Options Agreement.
If designated in the Notice of Grant as an Incentive Stock Option,
this Option is intended to qualify as an Incentive Stock Option under Section
422 of the Code.
2. Exercise of Option.
(a) Right to Exercise. This Option is exercisable during its
term in accordance with the Vesting Schedule set out in the Notice of Grant and
the applicable provisions of the Plan and this Option Agreement. In the event
of Optionee's death, disability or other termination of Optionee's employment
or consulting relationship, the exercisability of the Option is governed by the
applicable provisions of the Plan and this Option Agreement.
(b) Method of Exercise. This Option is exercisable only upon
execution and delivery by Optionee of (i) an exercise notice, in the form
attached to the Notice of Grant as Exhibit B (the "Exercise Notice"), which
shall state the election to exercise the Option and the number of Shares in
respect of which the Option is being exercised (the "Exercised Shares"), (ii)
such other representations and agreements as to the holder's investment intent
with respect to the Exercised Shares as may be required by the Company pursuant
to the provisions of the Plan, including the Investment Representation
Statement in the form attached to the Notice of Grant as EXHIBIT C and (iii)
each of the Stockholders Agreement in the form attached to the Notice of Grant
as EXHIBIT D and the Proxy in the form attached thereto. The Exercise Notice
shall be signed by the Optionee and, if the Optionee is married, by the
Optionee's spouse, and shall be delivered in person or by certified mail to the
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 only upon receipt by the Company of fully executed
originals of each of the documents referred to in clauses (i), (ii) and (iii)
above accompanied by such aggregate Exercise Price.
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No Shares shall be issued pursuant to the exercise of this
Option unless such issuance and exercise complies with all relevant provisions
of law and the requirements of any stock exchange upon which the Shares are then
listed. 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.
3. Method of Payment. Payment of the aggregate Exercise Price
shall be by any of the following, or a combination thereof, at the election of
the Optionee:
(a) cash; or
(b) check; or
(c) such other consideration as is indicated on the Notice
of Grant.
4. Optionee's Representations. In the event the Shares
purchasable pursuant to the exercise of this Option have not been registered
under the Securities Act of 1933, as amended, 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
Investment Representation Statement in the form attached to the Notice of Grant
as EXHIBIT C.
5. Restrictions on Exercise. This Option may not be exercised
until such time as the Plan has been approved by the Stockholders of the
Company, or if the issuance of such Shares upon such exercise or the method of
payment of consideration for such shares would constitute a violation of any
applicable federal or state securities or other law or regulation, including any
rule under Part 207 of Title 12 of the Code of Federal Regulations ("Regulation
G") as promulgated by the Federal Reserve Board. As a condition to the exercise
of this Option, the Company may require Optionee to make any representation and
warranty to the Company as may be required by any applicable law or regulation.
Termination of Relationship. In the event of termination
of Optionee's consulting relationship or Continuous Status as an Employee,
Optionee may, to the extent otherwise so entitled at the date of such
termination (the "Termination Date"), exercise this Option during the
Termination Period set out in the Notice of Grant. To the extent that Optionee
was not entitled to exercise this Option at the date of such termination, or if
Optionee does not exercise this Option within the time specified herein, the
Option shall terminate.
7. Disability of Optionee. Notwithstanding the provisions of
Section 6 above, in the event of termination of Optionee's Continuous Status as
an Employee as a result of disability (as determined by the Board in accordance
with the policies of the Company), Optionee may, but only within six (6) months
from the date of termination of employment (but in no event later than the date
of expiration of the term of this Option as set forth in Section 10 below),
exercise the Option to the extent otherwise so entitled at the date of such
termination. To the extent that Optionee was not entitled to exercise the Option
at the
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date of termination, or if Optionee does not exercise such Option (to
the extent otherwise so entitled) within the time specified herein, the
Option shall terminate.
8. Death of Optionee. In the event of the death of
Optionee, the Option may be exercised at any time within twelve (12)
months following the date of death (but in no event later than the date
of expiration of the term of this Option as set forth in Section 10
below), by Optionee's estate or by a person who acquired the right to
exercise the Option by bequest or inheritance, but only to the extent
the Optionee could exercise the Option at the date of death.
9. Non-Transferability of Option. This Option may not be
transferred in any manner otherwise than by will or by the laws of
descent or distribution and may be exercised during the lifetime of
Optionee only by him. The terms of this Option shall be binding upon the
executors, administrators, heirs, successors and assigns of the
Optionee.
10. Term of Option. This Option may be exercised only
within the term set out in the Notice of Grant, and may be exercised
during such term only in accordance with the Plan and the terms of this
Option. The limitations set out in Section 7 of the Plan regarding
Option terms and Options granted to more than ten percent (10%)
stockholders shall apply to this Option.
11. Governing Law Severability. This Agreement shall be
governed by and construed in accordance with the laws of the State of
California 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.
12. Tax Consequences. Some of the federal and California
tax consequences relating to this 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.
(a) Exercising the Option.
(i) Nonqualified Stock Option ("NSO"). If
this Option does not qualify as an ISO, the Optionee may incur regular federal
income tax and California income tax liability upon exercise. 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, 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 equal to a percentage of this compensation income at the
time of exercise.
(ii) Incentive Stock Option ("ISO"). If this
Option qualifies as an ISO, the Optionee will have no regular federal income tax
or California income tax liability upon its exercise, although the excess, if
any, of the fair market value of the Exercised Shares
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on the date of exercise over their aggregate Exercise Price will be treated as
an adjustment to the alternative minimum tax for federal tax purposes and may
subject the Optionee to alternative minimum tax in the year of exercise.
(b) Disposition of Shares.
(i) NSO. If the Optionee holds NSO Shares for
at least one year, any gain realized on disposition of the Shares will be
treated as long-term capital gain for federal income tax purposes.
(ii) ISO. If the Optionee holds ISO Shares
for at least one year after exercise and two years after the grant date, any
gain realized on disposition of the Shares will be treated as long-term capital
gain for federal income tax purposes. If the Optionee disposes of ISO Shares
within one year after exercise or two years after the grant date, any gain
realized on such disposition will be treated as compensation income (taxable at
ordinary income rates) to the extent of-the excess, if any, of the lesser of the
difference between the fair market value of the Shares acquired on the date of
exercise and the aggregate Exercise Price, or the difference between the sale
price of such Shares and the aggregate Exercise Price.
(c) Notice of Disqualifying Disposition of ISO Shares. If
the Optionee sells or otherwise disposes of any of the Shares acquired pursuant
to an ISO on or before the later of the date two years after the grant date, or
the date one year after the exercise date, the Optionee shall immediately notify
the Company in writing of such disposition. The Optionee agrees that he or she
may be subject to income tax withholding by the Company on the compensation
income recognized from such early disposition of ISO Shares by payment in cash
or out of the current earnings paid to the Optionee.
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EXHIBIT B TO NOTICE OF ▇▇▇▇▇
EXERCISE NOTICE FOR VESTED SHARES
GameFx, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Secretary
1. Exercise of Option. Effective as of today, _________________,
19__, the undersigned ("Optionee") hereby elects to exercise Optionee's option
to purchase _______________ shares of the Common Stock (the "Shares") of GameFx,
Inc. (the "Company") under and pursuant to the Company's 1997 Stock Option Plan,
as amended (the "Plan"), and the Notice of Grant, and the [ ]Incentive[ ]
Nonqualified Stock Option Agreement dated _____________ (together, the
"Option").
2. Representations of Optionee. Optionee acknowledges that
Optionee has received, read and understood the Plan and the Option Agreement and
agrees to abide by and be bound by their terms and conditions. Optionee
represents that Optionee is purchasing the Shares for Optionee's own account for
investment and not with a view to, or for sale in connection with, a
distribution of any of such Shares and Optionee has read, understood and
executed the Investment Representation Statement attached as Exhibit C to the
Notice of Grant.
3. Compliance with Securities Laws; Federal Restrictions on
Transfer. Optionee has read and executed the Investment Representation Statement
attached as Exhibit C to the Notice of Grant. Optionee represents that he or she
understands the matters set forth in the Investment Representation Statement and
that he or she is purchasing the Shares subject to the restrictions and
limitations set forth in that document.
4. Buyout Option of Electronic Arts Inc.: Execution of
Stockholders Agreement. Optionee acknowledges that Optionee has received, read
and understood the Description of the Transactions with Electronic Arts Inc.
("EA") and the Stockholders Agreement in the form attached as Exhibit D to the
Notice of ▇▇▇▇▇ and agrees to abide by and be bound by the terms and conditions
of the Stockholders Agreement. Optionee understands that Optionee is agreeing to
sell the shares being purchased hereby to EA upon the exercise by EA, if ever,
of its option to acquire all of the outstanding shares of the Company's stock
and that the aggregate consideration received by all securityholders of the
Company for such purchase of all of the Company's outstanding shares and the
assumption by EA, or cancellation, of all options outstanding under the Plan
shall be not less than an aggregate of $6,000,000 and not more than an aggregate
of $12,000,000 as more fully described in the Description of the Transactions
with EA. Optionee delivers herewith an
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executed counterpart signature page to the Stockholders Agreement attached as
Exhibit D to the Notice of Grant and an executed Proxy in favor of EA in the
form attached thereto.
5. Right of First Refusal. Before any Shares held by Optionee or
any transferee (either being sometimes referred to herein as the "Holder") may
be sold or otherwise transferred (including transfer by gift or operation of
law), the Company or its assignee(s) shall have a right of first refusal to
purchase the Shares on the terms and conditions set forth in this Section (the
"Right of First Refusal").
(a) Notice of Proposed Transfer. The Holder of the Shares
shall deliver to the Company a written notice (the "Sale Notice") stating: (i)
the Holder's bona fide intention to sell or otherwise transfer such Shares; (ii)
the name of each proposed purchaser or other transferee ("Proposed Transferee");
(iii) the number of Shares to be transferred to each Proposed Transferee; and
(iv) the bona fide cash price or other consideration for which the Holder
proposes to transfer the Shares (the "Offered Price"), and the Holder shall
offer the Shares at the Offered Price to the Company or its assignee(s).
(b) Bona Fide Transfer. Within ten (10) days after receipt
of the Sale Notice, the Company shall determine the bona fide nature of the
proposed voluntary transfer and give the Optionee written notice of the
Company's determination. If the proposed transfer is deemed not to be bona fide,
the Optionee shall be responsible for providing additional information to the
Company to show the bona fide nature of the proposed transfer. The Company shall
have the right to demand further assurances from the Optionee and the Proposed
Transferee (in a form satisfactory to the Company) that the Sale Notice fully
and accurately sets forth all of the terms and conditions of the proposed
transfer, including, without limitation, assurance that the Sale Notice fully
and accurately sets forth the consideration actually to be paid for the Shares
and all transactions, directly or indirectly, between the parties which may have
affected the price the Proposed Transferee was willing to pay for the Shares.
(c) Exercise of Right of First Refusal by Company. In the
event that the proposed transfer is deemed to be bona fide, the Company and/or
its assignee(s) may, by giving written notice to the Holder, elect to purchase
all, but not less than all, of the Shares proposed to be transferred to any one
or more of the Proposed Transferees, at the purchase price determined in
accordance with subsection (c) below. Such written notice may be given within
thirty (30) days after receipt of the Sale Notice.
(d) Purchase Price. The purchase price ("Purchase Price")
for the Shares purchased by the Company or its assignee(s) under this Section
shall be the Offered Price. If the Offered Price includes consideration other
than cash, the cash equivalent value of the non-cash consideration shall be
determined by the Board of Directors of the Company in good faith.
(e) Payment. Payment of the Purchase Price shall be made,
at the option of the Company or its assignee(s), by cancellation of all or a
portion of any outstanding indebtedness of the Holder to the Company (or, in the
case of repurchase by an assignee, to the assignee), or by any combination
thereof within sixty (60) days after receipt of the Sale
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Notice, in the manner and at the times set forth in such notice.
(f) ▇▇▇▇▇▇'s Right to Transfer. If all of the Shares
proposed in the Notice to be transferred to a given Proposed Transferee are not
purchased by the Company and/or its assignee(s), then the Holder may sell or
otherwise transfer such Shares to that Proposed Transferee at the Offered Price
or at a higher price, provided that such sale or other transfer is consummated
within one hundred twenty (120) days after the date of the Notice and provided
further that any such sale or other transfer is effected in accordance with any
applicable securities laws and the Proposed Transferee agrees in writing that
the provisions of this Section shall continue to apply to the Shares in the
hands of such Proposed Transferee. If the Shares described in the Notice are not
transferred to the Proposed Transferee within such period, a new Notice shall be
given to the Company, and the Company and/or its assignees shall again be
offered the Right of First Refusal before any Shares held by the Holder may be
sold or otherwise transferred.
(g) Exception for Certain Family Transfers. Anything to
the contrary contained in this Section notwithstanding, the transfer of any or
all of the Shares during the Optionee's lifetime or on the Optionee's death by
will or intestacy to the Optionee's immediate family or a trust for the benefit
of the Optionee's immediate family shall be exempt from the provisions of this
Section. "Immediate Family" as used herein shall mean spouse, lineal descendant
or antecedent, father, mother, brother or sister. In such case, the transferee
or other recipient shall receive and hold the Shares so transferred subject to
the provisions of this Section, and there shall be no further transfer of such
Shares except in accordance with the terms of this Section.
(h) Transfers Not Subject to the Right of First Refusal.
The Right of First Refusal shall not apply to any transfer or exchange of the
shares acquired pursuant to the exercise of the Option if such transfer is in
connection with a Change in Capitalization, as described in Section 13 of the
Plan. If the consideration received pursuant to such transfer or exchange
consists of stock of a Parent or Subsidiary, such consideration shall remain
subject to the Right of First Refusal unless the provisions of paragraph 4(j)
result in a termination of the Right of First Refusal.
(i) Assignment of the Right of First Refusal. The Company
shall have the right to assign the Right of First Refusal at any time, whether
or not the Optionee has attempted a transfer, to one or more persons as may be
selected by the Company,
(j) Early Termination of the Right of Refusal. The other
provisions of this paragraph 4 notwithstanding, the Right of First Refusal shall
terminate, and be or no further force and effect upon (i) a merger of the
Company or transaction in which over 80% of the voting power of the Company is
transferred and following which the stockholders of the Company have less then
20% of the voting power or the resulting or combined entity and shall not apply
with respect to shares sold in such offering or acquisition, or (ii) the
existence of a public market for the class of shares subject to the Right of
First Refusal. A "public market" shall be deemed to exist if (x) such stock is
listed on a national securities exchange (as that term is used in the Exchange
Act) or (y) such stock is traded on the over-the-counter market and prices
therefor are published daily on business days in a recognized financial journal.
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6. Rights as Stockholder. Subject to the terms and conditions of
this Agreement, Optionee shall have all of the rights of a stockholder of the
Company with respect to the Shares from and after the date that Optionee
delivers full payment of the Exercise Price until such time as Optionee disposes
of the Shares or the Company and/or its assignee(s) exercises the Right of First
Refusal hereunder. Upon such exercise, Optionee shall have no further rights as
a holder of the Shares so purchased except the right to receive payment for the
Shares so purchased in accordance with the provisions of this Agreement, and
Optionee shall forthwith cause the certificate(s) evidencing the Shares so
purchased to be surrendered to the Company for transfer or cancellation.
7. Tax Consultation. Optionee understands that Optionee may
suffer adverse tax consequences as a result of Optionee's purchase or
disposition of the Shares. Optionee represents that Optionee has consulted with
any tax consultants Optionee deems advisable in connection with the purchase or
disposition of the Shares and that Optionee is not relying on the Company for
any tax advice.
8. 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 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 OR TRANSFER, PLEDGE OR HYPOTHECATION IS IN COMPLIANCE
THEREWITH.
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO
CERTAIN RESTRICTIONS ON TRANSFER AND RIGHT OF FIRST REFUSAL
OPTIONS HELD BY THE ISSUER OR ITS ASSIGNEE(S) AS SET FORTH
IN THE EXERCISE NOTICE BETWEEN THE ISSUER AND THE ORIGINAL
HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT
THE PRINCIPAL OFFICE OF THE ISSUER. SUCH TRANSFER
RESTRICTIONS AND RIGHT OF FIRST REFUSAL ARE BINDING ON
TRANSFEREES OF THESE SHARES.
IT IS UNLAWFUL TO CONSUMMATE A SALE OR TRANSFER OF THIS
SECURITY, OR ANY INTEREST THEREIN, OR TO RECEIVE ANY
CONSIDERATION THEREFOR, WITHOUT THE PRIOR
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WRITTEN CONSENT OF THE COMMISSIONER OF CORPORATIONS OF THE
STATE OF CALIFORNIA, EXCEPT AS PERMITTED IN THE
COMMISSIONER'S RULES.
THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE
SOLD, EXCHANGED OR OTHERWISE TRANSFERRED OR DISPOSED OF
EXCEPT IN COMPLIANCE WITH THE TERMS AND CONDITIONS OF THE
STOCKHOLDERS AGREEMENT DATED AS OF October ___, 1997, AS
IT MAY BE AMENDED, AMONG ELECTRONIC ARTS INC., THE
REGISTERED HOLDER OF THIS CERTIFICATE, AND THE OTHER
STOCKHOLDERS OF THE ISSUER, A COPY OF WHICH IS ON FILE AT
THE PRINCIPAL EXECUTIVE OFFICES OF THE ISSUER.
Optionee understands that transfer of the Shares may be
restricted by Section 260.141.11 of the Rules of the California Corporations
Commissioner, a copy of which is attached to the Investment Representation
Statement (Exhibit C to the Notice of Grant).
(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 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 Shares or to accord the right to vote or pay dividends to
any purchaser or other transferee to whom such Shares shall have been so
transferred.
(d) Market Standoff Agreement. Optionee agrees, in
connection with the Company's initial underwritten public offering of the
Company's securities, (1) not to sell, make short sale of, loan, grant any
options for the purchase of, or otherwise dispose of any shares of Common Stock
of the Company held by Optionee (other than those shares included in the
registration) without the prior written consent of the Company or the
underwriters managing such initial underwritten public offering of the Company's
securities for one hundred eighty (180) days from the effective date of such
registration, and (2) further agrees to execute any agreement reflecting (1)
above as may be requested by the underwriters at the time of the public
offering; provided however that the officers and directors of the Company who
own the stock of the Company also agree to such restrictions.
9. 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, administrators,
successors and assigns.
10. Interpretation. Any dispute regarding the interpretation of
this
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Agreement shall be submitted by Optionee or by the Company forthwith to the
Company's Board of Directors or the committee thereof that administers the Plan,
which shall review such dispute at its next regular meeting. The resolution of
such a dispute by the Board or committee shall be final and binding on the
Company and on Optionee.
11. Governing Law; Severability. This Agreement shall be governed by
and construed in accordance with the laws of the State of Delaware 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.
12. 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.
13. 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.
14. Delivery of Payment. Optionee herewith delivers to the Company the
full Exercise Price for the Shares.
15. Third Party Beneficiary. EA is an intended third party beneficiary
of this Agreement. Optionee and the Company agree that the terms of this
Agreement may be enforced by EA.
16. Entire Agreement. The Plan, the Notice of Grant, and each of the
exhibits thereto, including the Option Agreement, are incorporated herein by
reference. This Agreement, the Plan and the Notice of Grant, and each of the
exhibits thereto, including the Option Agreement, 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, and is governed by Delaware law except for that body of law pertaining
to conflict of laws.
Submitted by: Accepted by:
PURCHASER: GAMEFX, INC.
a Delaware corporation
By
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(Signature) Its
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Address Address
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_________________________________ Arlington, MA 02174
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EXHIBIT C TO NOTICE OF GRANT
INVESTMENT REPRESENTATION STATEMENT
OPTIONEE: _____________________________________
COMPANY: GameFx, Inc., a Delaware Corporation
SECURITY: COMMON STOCK
AMOUNT: ______________________________________
DATE: ______________________________________
In connection with the purchase of the above-listed Securities, the undersigned
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. In this connection,
Optionee understands that, in the view of the Securities and Exchange
Commission, the statutory basis for such exemption may be unavailable if
Optionee's representation was predicated solely upon a present intention to hold
these Securities for the minimum capital gains period specified under tax
statutes, for a deferred sale, for or until an increase or decrease in the
market price of the Securities, or for a period of one year or any other fixed
period in the future. Optionee further 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 which 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, a legend prohibiting their
transfer without the consent of the Commissioner of Corporations of the State of
California and any other legend required under applicable state securities laws.
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(c) Optionee is familiar with the provisions of Rule 701 and Rule 144,
each promulgated under the Securities Act, which, in substance, permit 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. Rule 701 provides that if the issuer qualifies under Rule
701 at the time of exercise of the Option by the Optionee, such exercise will be
exempt from registration under the Securities Act. In the event the Company
later becomes subject to the reporting requirements of Section 13 or 15(d) of
the Securities Exchange Act of 1934, ninety (90) days thereafter the securities
exempt under Rule 701 may be resold, subject to the satisfaction of certain of
the conditions specified by Rule 144, including among other things: (1) the sale
being made through a broker in an unsolicited "brokers 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, and the amount of
securities being sold during any three month period not exceeding the
limitations specified in Rule 144(e), if applicable.
In the event that the Company does not qualify under Rule 701 at the
time of exercise of the Option, then the securities may be resold in certain
limited circumstances subject to the provisions of Rule 144, which requires
among other things: (1) the resale occurring not less than one year after the
party has purchased, and made full payment for, within the meaning of Rule 144,
the securities to be sold; and, in the case of an affiliate, or of a
non-affiliate who has held the securities less than two years, (2) the
availability of certain public information about the Company, (3) the sale 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 (4) the amount of securities being sold
during any three month period not exceeding the specified limitations stated
therein, if applicable.
(d) Optionee agrees, in connection with the Company's initial
underwritten public offering of the Company's securities, (1) not to sell, make
short sale of, loan, grant any options for the purchase of, or otherwise dispose
of any shares of Common Stock of the Company held by Optionee (other than those
shares included in the registration) without the prior written consent of the
Company or the underwriters managing such initial underwritten public offering
of the Company's securities for one hundred eighty (180) days from the effective
date of such registration, and (2) further agrees to execute any agreement
reflecting (1) above as may be requested by the underwriters at the time of the
public offering; provided however that the officers and directors of the Company
who own the stock of the Company also agree to such restrictions.
(e) Optionee further understands that in the event all of the
applicable requirements of Rule 701 or 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 Rules 144
and 701 are 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
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144 or 701 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:
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Date:_______________, 19__
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EXHIBIT D TO NOTICE OF GRANT
STOCKHOLDERS AGREEMENT
SEE EXHIBIT C TO INFORMATION STATEMENT
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