EXHIBIT 10.42.1
BIGSTRING CORPORATION
2006 EQUITY INCENTIVE PLAN
Incentive Option Agreement
(Employees)
THIS AGREEMENT (together with Schedule A, attached hereto, this
"Agreement"), effective as of the date specified as the "Grant Date" on Schedule
A attached hereto, between BIGSTRING CORPORATION, a Delaware corporation (the
"Corporation"), and the individual identified on Schedule A attached hereto, an
Employee of the Corporation or an Affiliate (the "Participant").
R E C I T A L S :
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In furtherance of the purposes of the BigString Corporation 2006 Equity
Incentive Plan, as it may be hereafter amended (the "Plan"), the Corporation and
the Participant hereby agree as follows:
1. Incorporation of Plan. The rights and duties of the Corporation and the
Participant under this Agreement shall in all respects be subject to and
governed by this Agreement and the provisions of the Plan, the terms of which
are incorporated herein by reference. In the event of any conflict between the
provisions in this Agreement and those of the Plan, the provisions of this
Agreement shall govern. Unless otherwise defined herein, capitalized terms in
this Agreement shall have the same definitions as set forth in the Plan. A copy
of the Plan has been delivered to the Participant with this Agreement.
2. Grant of Incentive Option; Term of Incentive Option. The Corporation
hereby grants to the Participant pursuant to the Plan, an Incentive Option (the
"Incentive Option") to purchase ________ shares (the "Shares") of the
Corporation's common stock, par value $.0001 per share ("Common Stock"), at the
purchase price (the "Option Price") specified on Schedule A attached hereto, and
subject to such other terms and conditions as may be stated herein, in the Plan
or on Schedule A. The Participant expressly acknowledges that the terms of
Schedule A shall be incorporated herein by reference and shall constitute part
of this Agreement. The Corporation and the Participant further acknowledge and
agree that the signatures of the Corporation and the Participant on the Grant
Notice contained in Schedule A shall constitute their acceptance of all of the
terms of this Agreement and their agreement to be bound by the terms of the
Plan. To the extent that the Incentive Option or any portion thereof does not
qualify as an Incentive Option under applicable law or the Plan, the Incentive
Option or portion thereof, as the case may be, shall be treated as a
Nonqualified Option. Except as otherwise provided in the Plan or this Agreement,
the Incentive Option will expire if not exercised in full by the Expiration Date
specified on Schedule A.
3. Exercise of Option. Subject to the terms of the Plan and this
Agreement, the Incentive Option shall become exercisable on the date or dates,
and subject to such conditions, as are set forth on Schedule A attached hereto.
To the extent that a portion of the Incentive Option is or becomes exercisable
and is not exercised, such portion shall accumulate and be exercisable by the
Participant in whole or in part at any time prior to expiration of the Incentive
Option, subject to the terms of the Plan and this Agreement. The Participant
expressly acknowledges
that the Incentive Option may vest and be exercisable only upon such terms and
conditions as are provided in this Agreement and the Plan.
To exercise all or any portion of the Incentive Option, the Participant
must provide to the Corporation (a) written notice of such exercise, which is to
include the number of shares of the Corporation's Common Stock to be purchased
upon such exercise (the "Exercise Notice"), and (b) payment of the Option Price
as provided below. The Exercise Notice is to be delivered to the Corporation, at
the following address:
BigString Corporation
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Attn: _______________
_______________
Upon the exercise of the Incentive Option in whole or in part and payment
of the Option Price in accordance with the provisions of the Plan and this
Agreement, the Corporation shall, as soon thereafter as practicable, deliver to
the Participant a certificate or certificates for the Shares purchased. Payment
of the Option Price may be made in cash or by cash equivalent. However, where
permitted by applicable law and approved by the Administrator, payment may also
be made (i) by delivery (by either actual delivery or attestation) of shares of
Common Stock owned by the Participant at the time of exercise; (ii) by shares of
Common Stock withheld upon exercise; (iii) by such other payment methods as may
be approved by the Administrator and which are acceptable under applicable law;
or (iv) by any combination of the foregoing methods. Shares delivered or
withheld in payment of the Option Price shall be valued at their Fair Market
Value on the date of exercise, as determined by the Administrator by applying
the provisions of the Plan.
4. No Right of Employment or Service; Forfeiture of Incentive Option.
Neither the Plan, this Agreement nor any other action related to the Plan shall
confer upon the Participant any right to continue in the employment or service
of the Corporation or an Affiliate or interfere with the right of the
Corporation or an Affiliate to terminate the Participant's employment or service
at any time. Except as otherwise expressly provided in the Plan or this
Agreement or as determined by the Administrator, all rights of the Participant
with respect to the Incentive Option shall terminate upon termination of the
employment of the Participant with the Corporation or an Affiliate.
5. Termination of Employment. Unless the Administrator determines
otherwise, the Incentive Option shall not be exercised unless the Participant
is, at the time of exercise, an Employee and has been an Employee continuously
since the date the Incentive Option was granted, subject to the following:
(a) The employment relationship of the Participant shall be treated
as continuing intact for any period that the Participant is on military or
sick leave or other bona fide leave of absence, provided that the period
of such leave does not exceed 90 days, or, if longer, as long as the
Participant's right to reemployment is guaranteed either by statute or by
contract. The employment relationship of the Participant shall also be
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treated as continuing intact while the Participant is not in active
service because of Disability. The Administrator shall have sole authority
to determine whether the Participant is disabled and, if applicable, the
Participant's Termination Date.
(b) Unless the Administrator determines otherwise, if the employment
of the Participant is terminated because of Disability or death, the
Incentive Option may be exercised only to the extent vested and
exercisable on the Participant's Termination Date. The Incentive Option
must be exercised, if at all, prior to the first to occur of the
following, whichever shall be applicable (X) the close of the period of 12
months next succeeding the Termination Date; or (Y) the close of the
Option Period. In the event of the Participant's death, the Incentive
Option shall be exercisable by such person or persons as shall have
acquired the right to exercise the Incentive Option by will or by the laws
of intestate succession.
(c) Unless the Administrator determines otherwise, if the employment
of the Participant is terminated for any reason, including Retirement,
other than Disability, death or for Cause, the Incentive Option may be
exercised to the extent vested and exercisable on his or her Termination
Date. The Incentive Option must be exercised, if at all, prior to the
first to occur of the following, whichever shall be applicable: (X) the
close of the period of three months next succeeding the Termination Date;
or (Y) the close of the Option Period. If the Participant dies following
such termination of employment and prior to the date specified in (X) of
this subparagraph (c), the Participant shall be treated as having died
while employed under subparagraph (b) immediately preceding (treating for
this purpose the Participant's date of termination of employment as the
Termination Date). In the event of the Participant's death, the Incentive
Option shall be exercisable by such person or persons as shall have
acquired the right to exercise the Incentive Option by will or by the laws
of intestate succession.
(d) Unless the Administrator determines otherwise, if the employment
of the Participant is terminated for Cause, the Incentive Option shall
lapse and no longer be exercisable as of his or her Termination Date, as
determined by the Administrator.
6. Notice of Disposition. If Shares of Common Stock acquired upon exercise
of the Incentive Option are disposed of within two years following the date of
grant or one year following the transfer of such Shares to the Participant upon
exercise, the Participant shall, promptly following such disposition, notify the
Corporation in writing of the date and terms of such disposition and provide
such other information regarding the disposition as the Administrator may
reasonably require.
7. Limitation on Incentive Options. In no event shall there first become
exercisable by the Participant in any one calendar year Incentive Options
granted by the Corporation or any Parent or Subsidiary with respect to shares of
Common Stock having an aggregate Fair Market Value (determined at the time an
Incentive Option is granted) greater than $100,000. To the extent that any
Incentive Options are first exercisable by the Participant in excess of such
limitation, the excess shall be considered a Nonqualified Option.
8. Nontransferability of Incentive Option. The Incentive Option shall not
be transferable (including by sale, assignment, pledge or hypothecation) other
than by will or the
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laws or intestate succession, or, in the Administrator's discretion, as may
otherwise be permitted in accordance with Section 422 of the Code and related
regulations. To the extent that this Incentive Option is treated as a
Nonqualified Option, the Incentive Option shall not be transferable (including
by sale, assignment, pledge or hypothecation) other than by will or the laws of
intestate succession, except as may be permitted by the Administrator. Except as
may be permitted by the preceding sentences, the Incentive Option shall be
exercisable during the Participant's lifetime only by him or her or by his or
her guardian or legal representative. The designation of a beneficiary in
accordance with the Plan does not constitute a transfer.
9. Superseding Agreement; Binding Effect. This Agreement, together with
the Plan, supersede any statements, representations or agreements of the
Corporation with respect to the grant of the Incentive Option or any related
rights, and the Participant hereby waives any rights or claims related to any
such statements, representations or agreements. This Agreement does not
supersede or amend any existing confidentiality agreement, nonsolicitation
agreement, noncompetition agreement, employment agreement or any other similar
agreement between the Participant and the Corporation, including, but not
limited to, any restrictive covenants contained in such agreements. This
Agreement shall be binding upon and shall inure to the benefit of the parties
hereto and their respective executors, administrators, heirs, successors and
assigns.
10. Governing Law. Except as otherwise provided in the Plan or herein,
this Agreement shall be construed and enforced according to the laws of the
State of New Jersey, without regard to the conflict of laws provisions of any
state, and in accordance with applicable federal laws of the United States.
11. Amendment and Termination; Waiver. Subject to the terms of the Plan,
this Agreement may be modified or amended only by the written agreement of the
parties hereto. The waiver by the Corporation of a breach of any provision of
this Agreement by the Participant shall not operate or be construed as a waiver
of any subsequent breach by the Participant. Notwithstanding the foregoing, the
Administrator shall have unilateral authority to amend the Plan and this
Agreement (without the Participant's consent) to the extent necessary to comply
with applicable law or changes to applicable law (including but in no way
limited to Code Section 409A and related regulations or other guidance and
federal securities laws).
12. No Rights as Stockholder. The Participant and his or her legal
representatives, legatees and distributes shall not be deemed to be the holder
of any Shares subject to the Incentive Option and shall not have any rights of a
stockholder unless and until the Incentive Option is properly exercised and
certificates for the Shares purchased upon such exercise have been issued and
delivered to him or her or them.
13. Withholding; Tax Matters.
(a) The Participant acknowledges that the Corporation shall require
the Participant to pay the Corporation in cash the amount of any tax or
other amount required by any governmental authority to be withheld and
paid over by the Corporation to such authority for the account of the
Participant, and the Participant agrees, as a condition to the grant of
the Incentive Option and delivery of the Shares or any other benefit, to
satisfy such obligations.
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(b) The Participant acknowledges that there may be adverse tax
consequences upon acquisition or disposition of the Shares subject to the
Incentive Option and that the Participant should consult a tax advisor
prior to such exercise or disposition. The Participant acknowledges that
he or she has been advised that he or she should consult with his or her
own attorney, accountant, and/or tax advisor regarding the decision to
enter into this Agreement and the consequences thereof. The Participant
also acknowledges that the Corporation has no responsibility to take or
refrain from taking any actions in order to achieve a certain tax result
for the Participant.
14. Administration. The authority to construe and interpret this Agreement
and the Plan, and to administer all aspects of the Plan, shall be vested in the
Administrator, and the Administrator shall have all powers with respect to this
Agreement as are provided in the Plan. Any interpretation of this Agreement by
the Administrator and any decision made by it with respect to this Agreement is
final and binding.
15. Notices. Any notices or other communications provided for in this
Agreement or the Plan shall be in writing and shall be deemed to have been
delivered or given (a) when hand delivered, (b) one (1) business day after being
sent by overnight courier, and (c) five (5) days after being mailed by
registered or certified mail, postage prepaid, return receipt requested, to the
party such notice or other communication was delivered or given. Notices shall
be directed, if to the Participant, at the Participant's address indicated on
Schedule A (or such other address as may be designated by the Participant in a
manner acceptable to the Administrator), or, if to the Corporation, at the
Corporation's principal office set forth in Section 3 hereof, attention
President and Chief Executive Officer. Notice may also be provided by electronic
submission, if and to the extent permitted by the Administrator.
16. Severability. The provisions of this Agreement are severable and if
any one or more provisions may be determined to be illegal or otherwise
unenforceable, in whole or in part, the remaining provisions shall nevertheless
be binding and enforceable.
17. Restrictions on Option and Shares. The Corporation may impose such
restrictions on the Incentive Option and the Shares or other benefits underlying
the Incentive Option as it may deem advisable, including, without limitation,
restrictions under the federal securities laws, the requirements of any stock
exchange or similar organization and any blue sky, state or foreign securities
laws applicable to the Incentive Option or the Shares. Notwithstanding any other
provision in the Plan or this Agreement to the contrary, the Corporation shall
not be obligated to issue, deliver or transfer the Shares, to make any other
distribution of benefits, or to take any other action, unless such delivery,
distribution or action is in compliance with all applicable laws, rules and
regulations (including, but not limited to, the requirements of the federal
securities laws). The Corporation may cause a restrictive legend to be placed on
any certificate for the Shares issued pursuant to the exercise of the Incentive
Option in such form as may be prescribed from time to time by applicable laws
and regulations or as may be advised by legal counsel.
18. Cash Settlement. Notwithstanding any other provision of the Plan or
this Agreement to the contrary, the Administrator may (subject to any
requirements imposed under Code Section 409A, related regulations or other
guidance) cause the Incentive Option or portion
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thereof to be cancelled in consideration of an alternative option or cash
payment of an equivalent cash value, as determined by the Administrator in its
sole discretion, made to the Participant.
19. Effect of Changes in Status. Unless the Administrator, in its sole
discretion, determines otherwise, the Incentive Option shall not be affected by
any change in the terms, conditions or status of the Participant's employment,
provided that the Participant continues to be in the employ of the Corporation
or an Affiliate. Without limiting the foregoing, the Administrator has sole
discretion to determine, at the time of grant of the Incentive Option or at any
time thereafter, the effect, if any, on the Incentive Option if the
Participant's status as an Employee changes, including but not limited to a
change from full-time to part-time, or vice versa, or if other similar changes
in the nature or scope of the Participant's employment occur.
20. Right of Offset. Notwithstanding any other provision of the Plan or
this Agreement, the Corporation may reduce the amount of any payment otherwise
payable to or on behalf of the Participant by the amount of any obligation of
the Participant to the Corporation that is then due and payable and the
Participant shall be deemed to have consented to such reduction.
21. Counterparts; Further Instruments. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
22. Further Assurances. The parties hereto agree to execute such
additional instruments and to take such further action as may be reasonably
necessary to carry out the purposes and intent of this Agreement.
[Signatures of the Corporation and the Participant follow
on Schedule A/Grant Notice.]
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Schedule A
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BIGSTRING CORPORATION
2006 EQUITY INCENTIVE PLAN
Incentive Option Agreement
(Employees)
Grant Notice
1. Pursuant to the terms and conditions of the BigString Corporation 2006
Equity Incentive Plan (the "Plan"), you (the "Participant") have been granted an
Incentive Option to purchase _______ shares (the "Shares") of our Common Stock
as outlined below.
Name of Participant: ____________________________
Address: ____________________________
____________________________
____________________________
Grant Date: ____________________________
Number of Shares Subject to Option ____________________________
Option Price: ____________________________
Type of Option: ____________________________
Expiration Date (Last day of Option Period): ____________________________
Vesting Schedule/Conditions:
2. By my signature below, I, the Participant, hereby acknowledge receipt
of (a) this Grant Notice, (b) the Incentive Option Agreement (the "Agreement"),
effective __________, 20__, between the Participant and BigString Corporation
(the "Corporation"), which is attached to this Grant Notice, and (c) a copy of
the Plan. I understand that the provisions of this Grant Notice are incorporated
by reference into the Agreement and constitute a part of the Agreement. By my
signature below, I further agree to be bound by the terms of the Plan and the
Agreement, including, but not limited to, the terms of this Grant Notice. The
Corporation reserves the right to treat the Incentive Option and the Agreement
as cancelled, void and of no effect if the Participant fails to return a signed
copy of this Grant Notice by __________, 20__.
BIGSTRING CORPORATION
By: ___________________________________
Name:
Title:
PARTICIPANT
___________________________________
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