EXHIBIT 10.4
LEAP WIRELESS INTERNATIONAL, INC.
2004 STOCK OPTION, RESTRICTED STOCK AND DEFERRED STOCK UNIT PLAN
DEFERRED STOCK UNIT AWARD GRANT NOTICE AND DEFERRED STOCK UNIT AWARD AGREEMENT
Leap Wireless International, Inc. (the "COMPANY"), pursuant to its 2004
Stock Option, Restricted Stock and Deferred Stock Unit Plan (the "PLAN"), hereby
grants to the holder listed below ("HOLDER"), the number of Deferred Stock Units
set forth below (the "DEFERRED STOCK UNITS"). The Deferred Stock Units are
subject to all of the terms and conditions as set forth herein and in the
Deferred Stock Unit Award Agreement attached hereto as Exhibit A (the "DEFERRED
STOCK UNIT AGREEMENT") and the Plan, each of which are incorporated herein by
reference. Unless otherwise defined herein, the terms defined in the Plan shall
have the same defined meanings in this Grant Notice and the Deferred Stock Unit
Agreement.
HOLDER:
GRANT DATE: ______________________
PURCHASE PRICE PER DEFERRED STOCK UNIT: ______________________ per share
TOTAL NUMBER OF DEFERRED STOCK UNITS: ______________________
VESTING SCHEDULE: The Deferred Stock Units shall be immediately vested.
DISTRIBUTION SCHEDULE: The Deferred Stock Units shall be distributable in
accordance with Section 2.4 of the Deferred Stock
Unit Agreement.
By his or her signature and the Company's signature below, ▇▇▇▇▇▇
agrees to be bound by the terms and conditions of the Plan, the Deferred Stock
Unit Agreement and this Grant Notice. ▇▇▇▇▇▇ has reviewed the Deferred Stock
Unit Agreement, the Plan and this Grant Notice in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Grant Notice
and fully understands all provisions of this Grant Notice, the Deferred Stock
Unit Agreement and the Plan. Holder hereby agrees to accept as binding,
conclusive and final all decisions or interpretations of the Administrator of
the Plan upon any questions arising under the Plan, this Grant Notice or the
Deferred Stock Unit Agreement.
LEAP WIRELESS INTERNATIONAL, INC. HOLDER:
By:____________________________________ By:_________________________________
Print Name:____________________________ Print Name:
Title:_________________________________ Address:____________________________
Address: ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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EXHIBIT A
TO DEFERRED STOCK UNIT AWARD GRANT NOTICE
DEFERRED STOCK UNIT AWARD AGREEMENT
Pursuant to the Deferred Stock Unit Award Grant Notice ("GRANT NOTICE")
to which this Deferred Stock Unit Award Agreement (this "AGREEMENT") is
attached, Leap Wireless International, Inc. (the "COMPANY") has granted to
Holder the number of Deferred Stock Units under the Company's 2004 Stock Option,
Restricted Stock and Deferred Stock Unit Plan (the "PLAN") indicated in the
Grant Notice.
ARTICLE I
GENERAL
1.1 Defined Terms. Capitalized terms not specifically defined herein
shall have the meanings specified in the Plan and the Grant Notice.
1.2 Incorporation of Terms of Plan. The Deferred Stock Units and the
shares of Common Stock issuable with respect thereto are subject to the terms
and conditions of the Plan which are incorporated herein by reference.
ARTICLE II
GRANT, VESTING AND DISTRIBUTION OF DEFERRED STOCK UNITS
2.1 Grant of Deferred Stock Units. In consideration of ▇▇▇▇▇▇'s past
and/or continued employment with or service to the Company or its Subsidiaries
and for other good and valuable consideration, effective as of the Grant Date
set forth in the Grant Notice (the "GRANT DATE"), the Company irrevocably grants
to Holder an award of the number of Deferred Stock Units indicated in the Grant
Notice, subject to all of the terms and conditions in the Plan and this
Agreement. A Deferred Stock Unit shall represent the right to purchase a share
of Common Stock at the time the Deferred Stock Unit is available for
distribution on a deferred basis in accordance with the terms and conditions of
the Plan and this Agreement.
2.2 Purchase Price. The purchase price of the shares of Common Stock
issuable pursuant to the Deferred Stock Units shall be as set forth in the Grant
Notice, without commission or other charge.
2.3 Vesting of Deferred Stock Units. On the Grant Date, the Deferred
Stock Units will be fully vested and shall not be subject to forfeiture.
2.4 Distribution of Deferred Stock Units.
(a) Shares of Common Stock shall be available for purchase by
▇▇▇▇▇▇ (or in the event of ▇▇▇▇▇▇'s death, to his or her estate) with respect to
such ▇▇▇▇▇▇'s vested Deferred Stock Units granted to Holder pursuant to this
Agreement, subject to the terms and provisions of
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the Plan and this Agreement, for a period of thirty (30) days commencing
following the earliest to occur of the following events (each, a "DISTRIBUTION
EVENT"):
(i) the date Holder has a Termination of Employment,
Termination of Consultancy or Termination of Directorship, as
applicable;
(ii) the date immediately prior to a Change in
Control; or
(iii) August 15, 2005.
(b) Following a Distribution Event, Holder may purchase the
shares of Common Stock issuable with respect to his or her vested Deferred Stock
Units by delivery to the Secretary of the Company or the Secretary's office of
all of the following within thirty (30) days following the occurrence of the
Distribution Event.
(i) A Purchase Notice in writing signed by the Holder
or any other person then entitled to purchase the shares of Common
Stock issuable with respect to the vested Deferred Stock Units, stating
that such shares of Common Stock are being purchased, such notice
complying with all applicable rules established by the Administrator.
Such notice shall be substantially in the form attached as Exhibit B to
the Grant Notice (or such other form as is prescribed by the
Administrator); and
(ii) Full payment (in cash or by check) for the
shares of Common Stock to be purchased by ▇▇▇▇▇▇, including payment of
any applicable withholding tax, which in the discretion of the
Administrator may be in any form permitted by Section 10.4 of the Plan;
and
(iii) A bona fide written representation and
agreement, in such form as is prescribed by the Administrator, signed
by Holder or the other person then entitled to purchase the shares of
Common Stock issuable with respect to the vested Deferred Stock Units,
stating that the shares of Common Stock are being acquired for Holder's
own account, for investment and without any present intention of
distributing or reselling said shares or any of them except as may be
permitted under the Securities Act and then applicable rules and
regulations thereunder, and that Holder or the other person then
entitled to purchase the shares of Common Stock issuable with respect
to the vested Deferred Stock Units will indemnify the Company against
and hold it free and harmless from any loss, damage, expense or
liability resulting to the Company if any sale or distribution of the
shares by such person is contrary to the representation and agreement
referred to above. The Administrator may, in its absolute discretion,
take whatever additional actions it deems appropriate to ensure the
observance and performance of such representation and agreement and to
effect compliance with the Securities Act and any other federal or
state securities laws or regulations. Without limiting the generality
of the foregoing, the Administrator may require an opinion of counsel
acceptable to it to the effect that any subsequent transfer of shares
acquired by ▇▇▇▇▇▇ does not violate the Securities Act, and may issue
stop-transfer orders covering such shares. Share certificates
evidencing Common Stock issued pursuant to the Deferred Stock Units
shall bear an appropriate legend referring to the provisions of this
subsection (c) and the agreements
herein. The written representation and agreement referred to in the
first sentence of this subsection (c) shall, however, not be required
if the shares to be issued pursuant to such exercise have been
registered under the Securities Act, and such registration is then
effective in respect of such shares; and
(iv) In the event the shares of Common Stock issuable
with respect to the vested Deferred Stock Units shall be purchased
pursuant to this Section 2.4(b) by any person or persons other than
Holder, appropriate proof of the right of such person or persons to
purchase such shares of Common Stock.
(c) Subject to the conditions of Sections 2.4(b) and 2.6, the
Company shall distribute any shares of Common Stock purchased pursuant to this
Section 2.4(b) in a single lump sum distribution. If Holder does not purchase
the shares of Common Stock issuable with respect to any vested Deferred Stock
Units within thirty (30) days following the occurrence of a Distribution Event,
such Deferred Stock Units shall terminate.
(d) All distributions shall be made by the Company in the form
of whole shares of Common Stock (and cash in an amount equal to the value of any
fractional Deferred Stock Unit, determined based on the Fair Market Value as of
the distribution date).
(e) Neither the time nor form of distribution of the Deferred
Stock Units under this Agreement may be changed, except as may be provided by
the Plan.
(f) Notwithstanding the foregoing, shares of Common Stock
shall be issuable pursuant to a Deferred Stock Unit at such times and upon such
events as are specified in this Agreement only to the extent issuance under such
terms will not cause the Deferred Stock Units or the shares of Common Stock
issuable pursuant to the Deferred Stock Units to be includible in the gross
income of Holder under Section 409A of the Code prior to such times or the
occurrence of such events, as permitted by the Code and the regulations and
other guidance thereunder.
2.5 Restrictions on Transfer. Unless otherwise permitted by the
Administrator pursuant to the Plan, no Deferred Stock Units or shares of Common
Stock issuable with respect thereto or any interest or right therein or part
thereof shall be liable for the debts, contracts or engagements of Holder or his
or her successors in interest or shall be subject to disposition by transfer,
alienation, anticipation, pledge, encumbrance, assignment or any other means
whether such disposition be voluntary or involuntary or by operation of law by
judgment, levy, attachment, garnishment or any other legal or equitable
proceedings (including bankruptcy), and any attempted disposition thereof shall
be null and void and of no effect.
2.6 Conditions to Issuance of Stock Certificates. The shares of Common
Stock deliverable with respect to the Deferred Stock Units, or any portion
thereof, may be either previously authorized but unissued shares or issued
shares which have then been reacquired by the Company. Such shares shall be
fully paid and nonassessable. The Company shall not be required to issue or
deliver any shares of Common Stock with respect to the Deferred Stock Units
prior to fulfillment of all of the following conditions:
(a) The admission of such shares to listing on all stock
exchanges on which such Common Stock is then listed; and
(b) The completion of any registration or other qualification
of such shares under any state or federal law or under rulings or regulations of
the Securities and Exchange Commission or of any other governmental regulatory
body, which the Administrator shall, in its absolute discretion, deem necessary
or advisable; and
(c) The obtaining of any approval or other clearance from any
state or federal governmental agency which the Administrator shall, in its
absolute discretion, determine to be necessary or advisable; and
(d) The lapse of such reasonable period of time following the
applicable Distribution Event as the Administrator may from time to time
establish for reasons of administrative convenience; and
(e) The receipt by the Company of full payment for such
shares, including payment of all amounts which, under federal, state or local
tax law, the Company (or other employer corporation) is required to withhold
upon issuance of such shares in accordance with Section 10.4 of the Plan.
2.7 Rights as Stockholder. Except as otherwise provided herein, Holder
shall not be, nor have any of the rights or privileges of, a stockholder of the
Company in respect of any shares issuable pursuant to the Deferred Stock Units
unless and until such shares shall have been issued by the Company to Holder.
ARTICLE III
OTHER PROVISIONS
3.1 Adjustment for Stock Split. In the event of any stock dividend,
stock split, reverse stock split, recapitalization, combination,
reclassification, or similar change in the capital structure of the Company,
appropriate adjustments shall be made in the Deferred Stock Units and/or the
shares of Common Stock issuable with respect thereto, consistent with any
adjustment under Section 10.3 of the Plan. The provisions of this Agreement
shall apply, to the full extent set forth herein with respect to the Deferred
Stock Units and the shares of Common Stock issuable with respect thereto, to any
and all shares of capital stock or other securities which may be issued in
respect of, or in exchange for, in substitution of the Deferred Stock Units and
the shares of Common Stock issuable with respect thereto, and shall be
appropriately adjusted for any stock dividends, splits, reverse splits,
combinations, recapitalizations and the like occurring after the date hereof.
3.2 Taxes. Notwithstanding anything to the contrary in this Agreement,
the Company shall be entitled to require payment to the Company or any of its
Subsidiaries in cash or deduction from other compensation payable to Holder of
any sums required by federal, state or local tax law to be withheld with respect
to the issuance or distribution of the Deferred Stock Units or shares of Common
Stock issuable with respect thereto. The Company shall not be obligated to
deliver any new certificate representing shares of Common Stock issuable with
respect to the Deferred Stock Units to Holder or his legal representative unless
and until Holder or his legal representative shall have paid or otherwise
satisfied in full the amount of all federal,
state and local taxes applicable to the taxable income of Holder resulting from
the grant of the Deferred Stock Units or the distribution of the shares of
Common Stock issuable with respect thereto.
3.3 Limitations Applicable to Section 16 Persons. Notwithstanding any
other provision of the Plan or this Agreement, if Holder is subject to Section
16 of the Exchange Act, the Plan, the Deferred Stock Units and the shares of
Common stock issuable with respect thereto and this Agreement shall be subject
to any additional limitations set forth in any applicable exemptive rule under
Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the
Exchange Act) that are requirements for the application of such exemptive rule.
To the extent permitted by applicable law, this Agreement shall be deemed
amended to the extent necessary to conform to such applicable exemptive rule.
3.4 Administration. The Administrator shall have the power to interpret
the Plan and this Agreement and to adopt such rules for the administration,
interpretation and application of the Plan as are consistent therewith and to
interpret, amend or revoke any such rules. All actions taken and all
interpretations and determinations made by the Administrator in good faith shall
be final and binding upon Holder, the Company and all other interested persons.
No member of the Administrator shall be personally liable for any action,
determination or interpretation made in good faith with respect to the Plan,
this Agreement or the Deferred Stock Units. In its absolute discretion, the
Board may at any time and from time to time exercise any and all rights and
duties of the Administrator under the Plan and this Agreement.
3.5 Restrictive Legends and Stop-Transfer Orders.
(a) Any share certificate(s) evidencing the shares of Common
Stock issued hereunder shall be endorsed with any legend required by any
applicable federal and state securities laws.
(b) ▇▇▇▇▇▇ 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) The Company shall not be required: (i) to transfer on its
books any shares of Common Stock 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 of Common Stock 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.
3.6 Notices. Any notice to be given under the terms of this Agreement
to the Company shall be addressed to the Company in care of the Secretary of the
Company, and any notice to be given to Holder shall be addressed to Holder at
the address given beneath ▇▇▇▇▇▇'s signature on the Grant Notice. By a notice
given pursuant to this Section 3.6, either party may hereafter designate a
different address for notices to be given to that party. Any notice shall be
deemed duly given when sent via email or when sent by certified mail (return
receipt requested)
and deposited (with postage prepaid) in a post office or branch post office
regularly maintained by the United States Postal Service.
3.7 Titles. Titles are provided herein for convenience only and are not
to serve as a basis for interpretation or construction of this Agreement.
3.8 Governing Law; Severability. This Agreement shall be administered,
interpreted and enforced under the laws of the State of Delaware without regard
to conflicts of laws thereof. 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.
3.9 Conformity to Securities Laws. Holder acknowledges that the Plan is
intended to conform to the extent necessary with all provisions of the
Securities Act and the Exchange Act and any and all regulations and rules
promulgated by the Securities and Exchange Commission thereunder, and state
securities laws and regulations. Notwithstanding anything herein to the
contrary, the Plan shall be administered, and the Deferred Stock Units are
granted, only in such a manner as to conform to such laws, rules and
regulations. To the extent permitted by applicable law, the Plan and this
Agreement shall be deemed amended to the extent necessary to conform to such
laws, rules and regulations.
3.10 Amendments. This Agreement may not be modified, amended or
terminated except by an instrument in writing, signed by ▇▇▇▇▇▇ and by a duly
authorized representative of the Company.
3.11 No Employment Rights. If Holder is an Employee, nothing in the
Plan or this Agreement shall confer upon Holder any right to continue in the
employ of the Company or any Subsidiary or shall interfere with or restrict in
any way the rights of the Company and its Subsidiaries, which are expressly
reserved, to discharge Holder at any time for any reason whatsoever, with or
without cause, except to the extent expressly provided otherwise in a written
agreement between the Company and Holder.
3.12 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 ▇▇▇▇▇▇ and his or her heirs, executors, administrators, successors and
assigns.
3.13 Unfunded, Unsecured Obligations. The obligations of the Company
under the Plan and this Agreement shall be unfunded and unsecured, and nothing
contained herein shall be construed as providing for assets to be held in trust
or escrow or any other form of segregation of the assets of the Company for the
benefit of Holder or any other person. Holder shall have only the rights of a
general, unsecured creditor of the Company with respect to the Deferred Stock
Units, unless and until shares of Common Stock shall be distributed to Holder
under the terms and conditions of this Agreement.
EXHIBIT B
TO DEFERRED STOCK UNIT AWARD GRANT NOTICE
FORM OF PURCHASE NOTICE
Effective as of today, ____________, _______, the undersigned
("Holder") hereby elects to purchase shares of the Common Stock (the "SHARES")
of Leap Wireless International, Inc. (the "COMPANY") under and pursuant to the
Leap Wireless International, Inc. 2004 Stock Option, Restricted Stock and
Deferred Stock Unit Plan (the "PLAN") and the Deferred Stock Unit Award Grant
Notice and Deferred Stock Unit Award Agreement dated____________, _______, (the
"AWARD AGREEMENT"). Capitalized terms used herein without definition shall have
the meanings given in the Award Agreement.
GRANT DATE: ___________________________
NUMBER OF SHARES BEING PURCHASED: _____________________________________
PURCHASE PRICE PER SHARE: $____________
TOTAL PURCHASE PRICE: $____________
CERTIFICATE TO BE ISSUED IN NAME OF: _____________________________________
CASH PAYMENT DELIVERED HEREWITH: $______________ (Representing the full
Purchase Price for the Shares, as well as
any applicable withholding tax)
1. Representations of Holder. Holder acknowledges that ▇▇▇▇▇▇ has
received, read and understood the Plan and the Award Agreement. ▇▇▇▇▇▇ agrees to
abide by and be bound by their terms and conditions.
2. Rights as Stockholder. Until the Shares are issued (as evidenced by
the appropriate entry on the books of the Company or of a duly authorized
transfer agent of the Company), no right to vote or receive dividends or any
other rights as a stockholder shall exist with respect to Shares,
notwithstanding the delivery of this Purchase Notice. No adjustment will be made
for a dividend or other right for which the record date is prior to the date the
Shares are issued, except as provided in Section 10.3 of the Plan.
3. Tax Consultation. Holder understands that there are tax consequences
to Holder as a result of ▇▇▇▇▇▇'s purchase or disposition of the Shares. Holder
represents that ▇▇▇▇▇▇ has consulted with any tax consultants Holder deems
advisable in connection with the purchase or disposition of the Shares and that
Holder is not relying on the Company for any tax advice.
4. Entire Agreement. The Plan and Award Agreement are incorporated
herein by reference. This Purchase Notice, the Plan and the Award Agreement
constitute the entire agreement of the parties and supersede in their entirety
all prior undertakings and agreements of the Company and Holder with respect to
the subject matter hereof.
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ACCEPTED BY: SUBMITTED BY
LEAP WIRELESS INTERNATIONAL, INC. HOLDER:
By:__________________________________ By:___________________________________
Print Name:__________________________ Print Name:
Title:_______________________________ Address:______________________________