1
EXHIBIT 10.16
SIMPLEX SOLUTIONS, INC.
1995 STOCK PLAN
RESTRICTED STOCK PURCHASE AGREEMENT
This Restricted Stock Purchase Agreement (the "Agreement") is made as of
March 30, 1999 by and between Simplex Solutions, Inc., a Delaware corporation
(the "Company") and ▇▇▇ ▇▇▇▇▇▇▇▇ ("Purchaser") pursuant to the Company's 1995
Stock Plan. To the extent any capitalized terms used in this Agreement are not
defined, they shall have the meaning ascribed to them in the 1995 Stock Plan.
1. SALE OF STOCK. Subject to the terms and conditions of this Agreement,
on the Purchase Date (as defined below) the Company will issue and sell to
Purchaser, and Purchaser agrees to purchase from the Company, 141,667 shares of
the Company's Common Stock (the "Shares") at a purchase price of $2.00 per Share
for a total purchase price of $283,334. The per share purchase price of the
Shares shall be not less than 85% of the fair market value of the Shares as of
the date of the offer of such Shares to Purchaser, or, in the case of any person
owning stock representing more than 10% of the total combined voting power of
all classes of stock of the Company (or any affiliated company), the per share
purchase price shall be not less than 100% of the fair market value of the
Shares as of such date. The term "Shares" refers to the purchased Shares and all
securities received in replacement of or in connection with the Shares pursuant
to stock dividends or splits, all securities received in replacement of the
Shares in a recapitalization, merger, reorganization, exchange or the like, and
all new, substituted or additional securities or other properties to which
Purchaser is entitled by reason of Purchaser's ownership of the Shares.
2. PURCHASE AND SALE OF THE SHARES. The purchase and sale of the Shares
under this Agreement shall occur at the principal office of the Company
simultaneously with the execution of this Agreement by the parties, or on such
other date as the Company and Purchaser shall agree (the "Purchase Date"). On
the Purchase Date, the Company will deliver to Purchaser a certificate
representing the Shares to be purchased by Purchaser (which shall be issued in
Purchaser's name) against payment of the purchase price therefor by Purchaser by
(a) check made payable to the Company, (b) cancellation of indebtedness of the
Company to Purchaser, (c) note made payable to the Company or (d) by a
combination of the foregoing.
3. LIMITATIONS ON TRANSFER. In addition to any other limitation on
transfer created by applicable securities laws, Purchaser shall not assign,
encumber or dispose of any interest in the Shares while the Shares are subject
to the Company's Repurchase Option (as defined below). After any Shares have
been released from such Repurchase Option, Purchaser shall not assign, encumber
or dispose of any interest in such Shares except in compliance with the
provisions below and applicable securities laws.
2
(a) REPURCHASE OPTION.
(i) In the event of the voluntary or involuntary termination of
Purchaser's employment or consulting relationship with the Company for any
reason with or without cause, the Company shall have an irrevocable, exclusive
option (the "Repurchase Option") for a period of 60 days from the effective date
of such termination (the "Termination Date") to repurchase all or any portion of
the Shares held by Purchaser as of the Termination Date which have not yet been
released from the Company's Repurchase Option at the original purchase price per
Share specified in Section 1 (adjusted for any stock splits, stock dividends and
the like).
(ii) The Repurchase Option shall be exercised by the Company by
written notice to the Purchaser or Purchaser's executor and, at the Company's
option, (A) by delivery to Purchaser or Purchaser's executor with such notice of
a check in the amount of the purchase price for the Shares being purchased, or
(B) in the event Purchaser is indebted to the Company, by cancellation by the
Company of an amount of such indebtedness equal to the purchase price for the
Shares being repurchased, or (C) by a combination of (A) and (B) so that the
combined payment and cancellation of indebtedness equals such purchase price.
Upon delivery of such notice and payment of the purchase price in any of the
ways described above, the Company shall become the legal and beneficial owner of
the Shares being repurchased and all rights and interest therein or related
thereto, and the Company shall have the right to transfer to its own name the
number of Shares being repurchased by the Company, without further action by the
Purchaser.
(iii) 100% of the Shares shall initially be subject to the
Repurchase Option. Thereafter, the Shares held by Purchaser shall he released
from the Company's repurchase option under this Section 3(a) as follows
(provided in each case that Purchaser's employment has not been terminated prior
to the date of any such release): twenty-five (25%) percent of the total number
of Shares shall be released from the repurchase option on January 20, 2000 and
one forty-eighth (1148th) of the Shares shall be released from the repurchase
option at the end of each month thereafter until all Shares are released from
the repurchase option. Fractional shares shall be rounded to the nearest whole
share.
(b) RIGHT OF FIRST REFUSAL. Before any Shares held by Purchaser or
any transferee of Purchaser (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 3(b) (the "Right of First Refusal").
(i) NOTICE OF PROPOSED TRANSFER. The Holder of the Shares shall
deliver to the Company a written notice (the "Notice") stating: (A) the Holder's
bona fide intention to sell or otherwise transfer such Shares; (B) the name of
each proposed purchaser or other transferee ("Proposed Transferee"); (C) the
number of Shares to be transferred to each Proposed Transferee; and (D) the
terms and conditions of each proposed sale or transfer. The Holder shall offer
the Shares at the same price (the "Offered Price") and upon the same terms (or
terms as similar as reasonably possible) to the Company or its assignee(s).
-2-
3
(ii) EXERCISE OF RIGHT OF FIRST REFUSAL. At any time within 30
days after receipt of the Notice, 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
(iii) below.
(iii) PURCHASE PRICE. The purchase price ("Purchase Price") for
the Shares purchased by the Company or its assignee(s) under this Section 3(b)
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.
(iv) PAYMENT. Payment of the Purchase Price shall be made, at
the option of the Company or its assignee(s), in cash (by check or wire
transfer), 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 30 days after receipt of the
Notice or in the manner and at the times set forth in the Notice.
(v) HOLDER'S RIGHT TO TRANSFER. Notwithstanding anything
contained herein to the contrary, it is hereby acknowledged and agreed that
Holder shall have no right to transfer to any third party other than the Company
as provided herein any of the Shares that remain subject to the Repurchase
Option. 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) as
provided in this Section 3(b), 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 60 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 3
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, or if the Holder proposes to change the price or
other terms to make them more favorable to the Proposed Transferee, 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.
(vi) EXCEPTION FOR CERTAIN FAMILY TRANSFERS. Anything to the
contrary contained in this Section 3(b) notwithstanding, the transfer of any or
all of the Shares during Purchaser's lifetime or on Purchaser's death by will or
intestacy to Purchaser's Immediate Family (as defined below) or a trust for the
benefit of Purchaser's Immediate Family shall be exempt from the provisions of
this Section 3(b). "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 3.
-3-
4
(c) INVOLUNTARY TRANSFER.
(i) COMPANY'S RIGHT TO PURCHASE UPON INVOLUNTARY TRANSFER. In
the event, at any time after the date of this Agreement, of transfer operation
of law or other involuntary transfer (including divorce or death, but excluding,
in the event of death, a transfer to Immediate Family as set forth in Section
3(b)(vi) above) of all or a portion of the Shares by the record holder thereof,
the Company shall have the right to purchase all of the Shares transferred at
the greater of the purchase price paid by Purchaser pursuant to this Agreement
or the fair market value of the Shares on the date of transfer as determined in
good faith by the Board of Directors in accordance with paragraph 3(c)(ii)
below. Upon such a transfer, the person acquiring the Shares shall promptly
notify the Secretary of the Company of such transfer. The right to purchase such
Shares shall be provided to the Company for a period of 30 days following
receipt by the Company of written notice by the person acquiring the Shares.
(ii) PRICE FOR INVOLUNTARY TRANSFER. With respect to any stock
to be transferred pursuant to Section 3(c)(i), the fair market value per Share
shall be a price set by the Board of Directors of the Company that will reflect
the current value of the stock in terms of present earnings of the Company,
future prospects of the Company and other factors deeded relevant by the Board
of Directors. The Company shall notify Purchaser or his or her executor of the
price so determined within 30 days after receipt by it of written notice of the
transfer or proposed transfer of Shares. However, if Purchaser does not agree
with the valuation as determined by the Board of Directors of the Company,
Purchaser shall be entitled to have the valuation determined by an independent
appraiser to be mutually agreed upon by the Company and Purchaser and whose fees
shall be borne equally by the Company and Purchaser.
(d) ASSIGNMENT. The right of the Company to purchase any part of the
Shares may be assigned in whole or in part to any stockholder or stockholders of
the Company or other persons or organizations; provided, however, that an
assignee, other than a corporation that is the Parent or a 100% owned Subsidiary
of the Company, must pay the Company, upon assignment of such right, cash equal
to the difference between the original purchase price and fair market value, if
the original purchase price is less than the fair market value of the Shares
subject to the assignment.
(e) RESTRICTIONS BINDING ON TRANSFEREES. All transferees of Shares
or any interest therein will receive and hold such Shares or interest subject to
the provisions of this Agreement, including, insofar as applicable, the
Repurchase Option. Any sale or transfer of the Shares shall be void unless the
provisions of this Agreement are satisfied.
(f) TERMINATION OF RIGHTS. The Right of First Refusal and the
Company's right to repurchase the Shares in the event of an involuntary transfer
pursuant to Section 3(c) above shall terminate upon the first sale of Common
Stock of the Company to the general public pursuant to a registration statement
filed with and declared effective by the Securities and Exchange Commission
under the Securities Act of 1933, as amended (the "Securities Act"). Upon
termination of the Right of First Refusal and the expiration or exercise of the
Repurchase Option, a new certificate or
-4-
5
certificates representing the Shares not repurchased shall be issued, on
request, without the legend referred to in Section 6(a)(ii) below and delivered
to Purchaser.
4. ESCROW OF UNVESTED SHARES. For purposes of facilitating the
enforcement of the provisions of Section 3 above, Purchaser agrees, immediately
upon receipt of the certificate(s) for the Shares subject to the Repurchase
Option, to deliver such certificate(s), together with an Assignment Separate
from Certificate in the form attached to this Agreement as executed by Purchaser
and by Purchaser's spouse (if required for transfer), in blank, to the Secretary
of the Company, or the Secretary's designee, to hold such certificate(s) and
Assignment Separate from Certificate in escrow and to take all such actions and
to effectuate all such transfers and/or releases as are in accordance with the
terms of this Agreement. Purchaser hereby acknowledges that the Secretary of the
Company, or the Secretary's designee, is so appointed as the escrow holder with
the foregoing authorities as a material inducement to make this Agreement and
that said appointment is coupled with an interest and is accordingly
irrevocable. Purchaser agrees that said escrow holder shall not be liable to any
party hereof (or to any other party). The escrow holder may rely upon any
letter, notice or other document executed by any signature purported to be
genuine and may resign at any time. Purchaser agrees that if the Secretary of
the Company, or the Secretary's designee, resigns as escrow holder for any or no
reason, the Board of Directors of the Company shall have the power to appoint a
successor to serve as escrow holder pursuant to the terms of this Agreement.
5. INVESTMENT AND TAXATION REPRESENTATIONS. In connection with the
purchase of the Shares, Purchaser represents to the Company the following:
(a) Purchaser 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 Shares. Purchaser is
purchasing the Shares for investment for his or her 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.
(b) Purchaser understands that the Shares have not been registered
under the Securities Act by reason of a specific exemption therefrom, which
exemption depends upon, among other things, the bona fide nature of Purchaser's
investment intent as expressed herein.
(c) Purchaser understands that the Shares are "restricted
securities" under applicable U.S. federal and state securities laws and that,
pursuant to these laws, Purchaser must hold the Shares indefinitely unless they
are registered with the Securities and Exchange Commission and qualified by
state authorities, or an exemption from such registration and qualification
requirements is available. Purchaser acknowledges that the Company has no
obligation to register or qualify the Shares for resale. Purchaser further
acknowledges that if an exemption from registration or qualification is
available, it may be conditioned on various requirements including, but not
limited to, the time and manner of sale, the holding period for the Shares, and
requirements relating to the Company which are outside of Purchaser's control,
and which the Company is under no obligation and may not be able to satisfy.
-5-
6
(d) Purchaser understands that Purchaser may suffer adverse tax
consequences as a result of Purchaser's purchase or disposition of the Shares.
Purchaser represents that Purchaser has consulted any tax consultants Purchaser
deems advisable in connection the purchase or disposition of the Shares and that
Purchaser is not relying on the Company for any tax advice.
6. RESTRICTIVE LEGENDS AND STOP-TRANSFER ORDERS.
(a) LEGENDS. The certificate or certificates representing the Shares
shall bear legends required by applicable state and federal corporate and
securities laws including:
(i) THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE NOT BEEN
ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION
WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR
DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN A FORM
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED UNDER THE SECURITIES ACT OF 1933.
(ii) THE SHARES REPRESENTED BY THIS CERTIFICATE MAY BE TRANSFERRED
ONLY IN ACCORDANCE WITH THE TERMS OF AN AGREEMENT BETWEEN THE
COMPANY AND THE STOCKHOLDER, A COPY OF WHICH IS ON FILE WITH THE
SECRETARY OF THE COMPANY.
(b) STOP-TRANSFER NOTICES. Purchaser 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.
7. NO EMPLOYMENT RIGHTS. Nothing in this Agreement shall affect in any
manner whatsoever the right or power of the Company, or a Parent or Subsidiary
of the Company, to terminate Purchaser's employment or consulting relationship,
for any reason, with or without cause.
8. SECTION 83(b) Election. Purchaser understands that Section 83(a) of
the Internal Revenue Code of 1986, as amended (the "Code"), taxes as ordinary
income the difference between the amount paid for the Shares and the fair market
value of the Shares as of the date any restrictions
-6-
7
on the Shares lapse. In this context, "restriction" means the right of the
Company to buy back the Shares pursuant to the Repurchase Option set forth in
Section 3(a) of this Agreement. Purchaser understands that Purchaser may elect
to be taxed at the time the Shares are purchased, rather than when and as the
Repurchase Option expires, by filing an election under Section 83(b) (an "83(b)
Election") of the Code with the Internal Revenue Service within 30 days from the
date of purchase. Even if the fair market value of the Shares at the time of the
execution of this Agreement equals the amount paid for the Shares, the election
must be made to avoid income under Section 83(a) in the future. Purchaser
understands that failure to file such an election in a timely manner may result
in adverse tax consequences for Purchaser. Purchaser further understands that an
additional copy of such election form should be filed with his or her federal
income tax return for the calendar year in which the date of this Agreement
falls. Purchaser acknowledges that the foregoing is only a summary of the effect
of United States federal income taxation with respect to purchase of the Shares
hereunder, and does not purport to be complete. Purchaser further acknowledges
that the Company has directed Purchaser to seek independent advice regarding the
applicable provisions of the Code, the income tax laws of any municipality,
state or foreign country in which Purchaser may reside, and the tax consequences
of Purchaser's death.
Purchaser agrees that he will execute and deliver to the Company
with this executed Agreement a copy of the Acknowledgment and Statement of
Decision Regarding Section 83(b) Election (the "Acknowledgment"), attached
hereto as Exhibit B. Purchaser further agrees that Purchaser will execute and
submit with the Acknowledgment a copy of the 83(b) Election, attached hereto as
Exhibit C, if Purchaser has indicated in the Acknowledgment his or her decision
to make such an election.
9. MARKET STANDOFF AGREEMENT. In connection with the initial public
offering of the Company's securities and upon request of the Company or the
underwriters managing such underwritten offering of the Company's securities,
Purchaser agrees not to sell, make any short sale of, loan, grant any option for
the purchase of, or otherwise dispose of any Shares (other than those included
in the registration) without the prior written consent of the Company or such
underwriters, as the case may be, for such period of time (not to exceed 180
days) from the effective date of such registration as may be requested by the
Company or such managing underwriters and to execute an agreement reflecting the
foregoing as may be requested by the underwriters at the time of the Company's
initial public offering.
10. MISCELLANEOUS.
(a) GOVERNING LAW. This Agreement and all acts and transactions
pursuant hereto and the rights and obligations of the parties hereto shall be
governed, construed and interpreted in accordance with the laws of the State of
California, without giving effect to principles of conflicts of law.
(b) ENTIRE AGREEMENT; ENFORCEMENT OF RIGHTS. This Agreement sets
forth the entire agreement and understanding of the parties relating to the
subject matter herein and merges all prior discussions between them. No
modification of or amendment to this Agreement, nor any
-7-
8
waiver of any rights under this Agreement, shall be effective unless in writing
signed by the parties to this Agreement. The failure by either party to enforce
any rights under this Agreement shall not be construed as a waiver of any rights
of such party.
(c) SEVERABILITY. If one or more provisions of this Agreement are
held to be unenforceable under applicable law, the parties agree to renegotiate
such provision in good faith. In the event that the patties cannot reach a
mutually agreeable and enforceable replacement for such provision, then (i) such
provision shall be excluded from this Agreement, (ii) the balance of the
Agreement shall be interpreted as if such provision were so excluded and (iii)
the balance of the Agreement shall be enforceable in accordance with its terms.
(d) CONSTRUCTION. This Agreement is the result of negotiations
between and has been reviewed by each of the parties hereto and their respective
counsel, if any; accordingly, this Agreement shall be deemed to be the product
of all of the parties hereto, and no ambiguity shall be construed in favor of or
against any one of the parties hereto.
(c) NOTICES. Any notice required or permitted by this Agreement
shall be in writing and shall be deemed sufficient when delivered personally or
sent by telegram or fax or 48 hours after being deposited in the U.S. mail, as
certified or registered mail, with postage prepaid, and addressed to the party
to be notified at such party's address as set forth below or as subsequently
modified by written notice.
(f) COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.
(g) SUCCESSORS AND ASSIGNS, The rights and benefits of this
Agreement shall inure to the benefit of, and be enforceable by the Company's
successors and assigns. The rights and obligations of Purchase under this
Agreement may only be assigned with the prior written consent of the Company.
(h) CALIFORNIA CORPORATE SECURITIES LAW. THE SALE OF THE SECURITIES
WHICH ARE THE SUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE
COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA AND THE ISSUANCE OF THE
SECURITIES OR THE PAYMENT OR RECEIPT OF ANY PART OF THE CONSIDERATION THEREFOR
PRIOR TO THE QUALIFICATION IS UNLAWFUL, UNLESS THE SALE OF SECURITIES IS EXEMPT
FROM QUALIFICATION BY SECTION 25100, 25102 OR 25105 OF THE CALIFORNIA
CORPORATIONS CODE. THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE EXPRESSLY
CONDITIONED UPON THE QUALIFICATION BEING OBTAINED, UNLESS THE SALE IS SO EXEMPT.
[Signature Page Follows]
-8-
9
The parties have executed this Agreement as of the date first set forth
above.
SIMPLEX SOLUTIONS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
Title: CFO
--------------------------------------
Address:
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
PURCHASER:
▇▇▇ ▇▇▇▇▇▇▇▇
/s/ ▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------------------
(Signature)
Address:
▇▇▇▇▇ ▇▇▇▇▇ ▇▇
--------------------------------------------
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
--------------------------------------------
I, _________________ spouse of ▇▇▇ ▇▇▇▇▇▇▇▇, have read and hereby approve the
foregoing Agreement. In consideration of the Company's granting my spouse the
right to purchase the Shares as set forth in the Agreement, I hereby agree to be
irrevocably bound by the Agreement and further agree that any community property
or similar interest that I may have in the Shares shall be similarly bound by
the Agreement. I hereby appoint my spouse as my attorney-in-fact with respect to
any amendment or exercise of any rights under the Agreement.
--------------------------------------------
Spouse of ▇▇▇ ▇▇▇▇▇▇▇▇
10
EXHIBIT A
ASSIGNMENT SEPARATE FROM CERTIFICATE
FOR VALUE RECEIVED and pursuant to that certain Restricted, Stock
Purchase Agreement between the undersigned ("Purchaser") and Simplex Solutions,
Inc. (the "Company") dated March 30, 1999 (the "Agreement"), Purchaser hereby
sells, assigns and transfers unto the Company______ (_____) shares of the Common
Stock of the Company, standing in Purchaser's name on the books of the Company
and represented by Certificate No. __, and does hereby irrevocably constitute
and appoint __________ to transfer said stock on the books of the Company with
full power of substitution in the premises. THIS ASSIGNMENT MAY ONLY BE USED AS
AUTHORIZED BY THE AGREEMENT AND THE EXHIBITS THERETO.
Dated:
------------------------------
Signature:
/s/ ▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
Spouse of ▇▇▇ ▇▇▇▇▇▇▇▇ (if applicable)
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 repurchase
option set forth in the Agreement without requiring additional signatures on the
part of Purchaser.
11
RECEIPT
Simplex Solutions, Inc. hereby acknowledges receipt of a promissory note
in the amount of $283,334.00 given by ▇▇▇ ▇▇▇▇▇▇▇▇ as consideration for
Certificate No. _______________ for 141,667 shares of Common Stock of Simplex
Solutions, Inc.
Dated:
-----------------------------
Simplex Solutions, Inc.
By: [Signature Illegible]
-------------------------------------
Title: CFO
----------------------------------
12
RECEIPT AND CONSENT
The undersigned hereby acknowledges receipt of a photocopy of
Certificate No. _______ for 141,667 shares of Common Stock of Simplex Solutions,
Inc. (the "Company").
The undersigned further acknowledges that the Secretary of the Company,
or his or her designee, is acting as escrow holder pursuant to the Restricted
Stock Purchase Agreement Purchaser has previously entered into with the Company.
As escrow holder, the Secretary of the Company, or his or her designee, holds
the original of the aforementioned certificate issued in the undersigned's name.
Dated:
---------------------------------
/s/ ▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
▇▇▇ ▇▇▇▇▇▇▇▇
13
PROMISSORY NOTE
$283,334.00 Sunnyvale, California
March 30, 1999
FOR VALUE RECEIVED, ▇▇▇ ▇▇▇▇▇▇▇▇ PROMISES TO PAY TO SIMPLEX SOLUTIONS,
INC., a Delaware corporation (the "Company"), the principal sum of TWO HUNDRED
EIGHTY THREE THOUSAND THREE HUNDRED THIRTY-FOUR ($283,334.00), together with
interest on the unpaid principal hereof from the date hereof at the rate of four
and eighty-three one hundredths percent (4.83%) per annum, compounded annually.
Principal and interest shall be due and payable no later than March 30,
2004. Payment of principal and interest shall be made in lawful money of the
United States of America.
The undersigned may at any time prepay all or any portion of the
principal or interest owing hereunder.
This Note is secured by a pledge of the Company's Common Stock under the
terms of the Security Agreement attached hereto as Exhibit A and is subject to
all the provisions thereof.
The holder of this Note shall have full recourse against the
undersigned, and shall not be required to proceed against the collateral
securing this Note in the event of default.
In the event the undersigned shall cease to be an employee, director or
consultant of the Company for any reason, this Note shall, at the option of the
Company, be accelerated, and the whole unpaid balance on this Note of principal
and accrued interest shall be immediately due and payable.
Should any action be instituted for the collection of this Note, the
reasonable costs and attorneys' fees therein of the holder shall be paid by the
undersigned.
▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
Signature
14
EXHIBIT A
SECURITY AGREEMENT
This Security Agreement is made as of March 30, 1999 between Simplex
Solutions, Inc., a Delaware corporation ("Pledgee"), and ▇▇▇ ▇▇▇▇▇▇▇▇
("Pledgor").
Recitals
Pursuant to Pledgor's election to purchase Shares under the Restricted
Stock Purchase Agreement dated March 30, 1999 (the "RSPA"), between Pledgor and
Pledgee under Pledgee's 1995 Stock Plan, and Pledgor's election to pay for such
shares with his promissory note (the "Note"), Pledgor has purchased 141,667
shares of Pledgee's Common Stock (the "Shares") at a price of $2.00 per share,
for a total purchase price of $283,334.00.
NOW, THEREFORE, it is agreed as follows:
1. Creation and Description of Security Interest. In consideration of
the transfer of the Shares to Pledgor pursuant to the terms of the RSP, Pledgor,
pursuant to the California Uniform Commercial Code, hereby pledges all of such
Shares (herein sometimes referred to as the "Collateral") represented by
certificate number __, duly endorsed in blank or with executed stock powers, and
herewith delivers said certificate to the Secretary of Pledgee ("Pledgeholder"),
who shall hold said certificate subject to the terms and conditions of this
Security Agreement.
The pledged stock (together with an executed blank stock assignment for
use in transferring all or a portion of the Shares to Pledgee if, as and when
required pursuant to this Security Agreement) shall be held by the Pledgeholder
as security for the repayment of the Note, and any extensions or renewals
thereof, and the Pledgeholder shall not encumber or dispose of such Shares
except in accordance with the provisions of this Security Agreement.
2. Pledgor's Representations and Covenants. To induce Pledgee to enter
into this Security Agreement, Pledgor represents and covenants to Pledgee, its
successors and assigns, as follows:
(a) Payment of Indebtedness. Pledgor will pay the principal sum of
the Note secured hereby, together with interest thereon, at the time and in the
manner provided in the Note.
(b) Encumbrances. The Shares are free of all other encumbrances,
defenses and liens, and Pledgor will not further encumber the Shares without the
prior written consent of Pledgee.
-1-
15
(c) Margin Regulations. In the event that Pledgee's Common Stock is
now or later becomes margin-listed by the Federal Reserve Board and Pledgee is
classified as a "lender" within the meaning of the regulations under Part 207 of
Title 12 of the Code of Federal Regulations ("Regulation G"), Pledgor agrees to
cooperate with Pledgee in making any amendments to the Note or providing any
additional collateral as may be necessary to comply with such regulations.
3. Voting Rights. During the term of this pledge and so long as all
payments of principal and interest are made as they become due under the terms
of the Note, Pledgor shall have the right to vote all of the Shares pledged
hereunder.
4. Stock Adjustments. In the event that during the term of the pledge
any stock dividend, reclassification, readjustment or other changes are declared
or made in the capital structure of Pledgee, all new, substituted and additional
shares or other securities issued by reason of any such change shall be
delivered to and held by the Pledgee under the terms of this Security Agreement
in the same manner as the Shares originally pledged hereunder. In the event of
substitution of such securities, Pledgor, Pledgee and Pledgeholder shall
cooperate and execute such documents as are reasonable so as to provide for the
substitution of such Collateral and, upon such substitution, references to
"Shares" in this Security Agreement shall include the substituted shares of
capital stock of Pledgor as a result thereof.
5. Options and Rights. In the event that, during the term of this
pledge, subscription options or other rights or options shall be issued in
connection with the pledged Shares, such rights, subscription options and
options shall be the property of Pledgor and, if exercised by Pledgor, all new
stock or other securities so acquired by Pledgor as it relates to the pledged
Shares then held by Pledgeholder shall be immediately delivered to Pledgeholder,
to be held under the terms of this Security Agreement in the same manner as the
Shares pledged.
6. Default. Pledgor shall be deemed to be in default of the Note and of
this Security Agreement in the event:
(a) Payment of principal or interest on the Note shall be delinquent
for a period of ten (10) days or more; or
(b) Pledgor fails to perform any of the covenants set forth in the
RSPA or contained in this Security Agreement for a period of ten (10) days after
written notice thereof from Pledgee.
In the case of an event of default, as set forth above, Pledgee shall
have the right to accelerate payment of the Note upon notice to Pledgor, and
Pledgee shall thereafter be entitled to pursue its remedies under the California
Uniform Commercial Code.
7. Release of Collateral. Subject to any applicable contrary rules under
Regulation G, there shall be released from this pledge a portion of the pledged
Shares held by Pledgeholder hereunder upon payments of the principal of the
Note. The number of the pledged Shares which
-2-
16
shall be released shall be that number of full Shares which bears the same
proportion to the initial number of Shares pledged hereunder as the payment of
principal bears to the initial full principal amount of the Note.
8. Withdrawal or Substitution of Collateral. Pledgor shall not sell,
withdraw, pledge, substitute or otherwise dispose of all or any part of the
Collateral without the prior written consent of Pledgee.
9. Term. The pledge of Shares as set forth herein shall continue until
the payment of all indebtedness secured hereby, at which time the remaining
pledged stock shall be promptly delivered to Pledgor, subject to the provisions
for prior release of a portion of the Collateral as provided in Section 7 above.
10. Insolvency. Pledgor agrees that if a bankruptcy or insolvency
proceeding is instituted by or against it, or if a receiver is appointed for the
property of Pledgor, or if Pledgor makes an assignment for the benefit of
creditors, the entire amount unpaid on the Note shall become immediately due and
payable, and Pledgee may proceed as provided in the case of default.
11. Pledgeholder Liability. In the absence of willful or gross
negligence, Pledgeholder shall not be liable to any party for any of his acts,
or omissions to act, as Pledgeholder.
12. Invalidity of Particular Provisions. Pledgor and Pledgee agree that
the enforceability or invalidity of any provision or provisions of this Security
Agreement shall not render any other provision or provisions herein contained
unenforceable or invalid.
13. Successors or Assigns. Pledgor and Pledgee agree that all of the
terms of this Security Agreement shall be binding on their respective successors
and assigns, and that the term "Pledgor" and the term "Pledgee" as used herein
shall be deemed to include, for all purposes, the respective designees,
successors, assigns, heirs, executors and administrators.
14. Entire Agreement; Governing Law. The Note is incorporated herein by
reference. The Note (including any and all documents referenced therein) and
this Security Agreement (including any and all documents referenced herein)
constitute the entire agreement of the parties with respect to the subject
matter hereof and supersede in their entirety all prior undertakings and
agreements of the parties with respect to the subject matter hereof. This
agreement is governed by the laws of the State of California.
-3-
17
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
"PLEDGOR"
/s/ ▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
Signature
▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
Print Name
Address: ▇▇▇▇▇ ▇▇▇▇▇ ▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
----------------------------------------
"PLEDGEE" Simplex Solutions, Inc.
a Delaware corporation
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Signature
▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------------
Print Name
CFO
----------------------------------------
Title
"PLEDGEHOLDER"
----------------------------------------
Secretary of
Simplex Solutions, Inc.
a Delaware corporation
-4-
18
RECEIPT AND CONSENT
The undersigned hereby acknowledges receipt of a photocopy of
Certificate No. ____ for 750,000 shares of Common Stock of Simplex Solutions,
Inc. (the "Company").
The undersigned further acknowledges that the Secretary of the Company,
or his or her designee, is acting as escrow holder pursuant to the Restricted
Stock Purchase Agreement Purchaser has previously entered into with the Company.
As escrow holder, the Secretary of the Company, or his or her designee, holds
the original of the aforementioned certificate issued in the undersigned's name.
Dated:
---------------------------------
-----------------------------------
▇▇▇ ▇▇▇▇▇▇▇▇