Exhibit 4.10
FORM OF
NON-QUALIFIED STOCK OPTION AGREEMENT
This Non-Qualified Stock Option Agreement (this "Agreement") is made
and entered into by and between netGuru, Inc., a Delaware corporation
("Company"), and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇("Optionee"), as of February 18, 2005
("Date of Grant"). If the Optionee is presently or subsequently becomes employed
by a subsidiary of the Company, the term "Company" shall be deemed to refer
collectively to netGuru, Inc. and the subsidiary or subsidiaries that employs
the Optionee.
RECITALS
The Board of Directors ("Board") has approved the granting of an option
to the Optionee for consulting services to be provided by the optionee.
AGREEMENT
In consideration of the mutual covenants and conditions hereinafter set
forth and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Company and the Optionee agree as follows:
1. Grant of Option. The Company hereby grants to the Optionee the right and
option ("Option") to purchase up to an aggregate of two thousand five hundred
(2,500) shares (such number being subject to adjustment as provided in paragraph
10 below) of the Common Stock of netGuru, Inc. ("Stock") on the terms and
conditions herein set forth. This Option may be exercised in whole or in part
and from time to time as hereinafter provided. The Option granted under this
Agreement is not intended to be an "incentive stock option" as set forth in
Section 422 of the Internal Revenue Code of 1986, as amended ("Code").
2. Vesting of Option. Subject to paragraph 8 below, the Option shall vest and
become exercisable in accordance with the schedule below:
On February 18, 2006, eight hundred and thirty four (834) shares
subject to the Option shall become vested and exercisable. On February 18, 2007,
an additional eight hundred and thirty three (833)shares subject to the Option
shall become vested and exercisable. On February 18, 2008, the remaining eight
hundred and thirty three (833) shares subject to the Option shall become vested
and exercisable, at which time 100% of the Stock subject to the Option shall
have vested and become exercisable.
3. Purchase Price. The price at which the Optionee shall be entitled to purchase
the Stock covered by the Option shall be $1.12 per share, which price is 100% of
the Fair Market Value of the Stock (herein after defined) on the Date of Grant.
For purposes of this Agreement, the "Fair Market Value" of a share of the
Company's Common Stock as of a given date shall be: (i) the closing price of a
share of the Company's Common Stock on the principal exchange on which shares of
the Company's Common Stock are then trading, if any, on the day immediately
preceding that date, or, if shares were not traded on that date, then on the
next preceding trading day during which a sale occurred; or (ii) if the
Company's Common Stock is not traded on an exchange but is quoted on The Nasdaq
National Market, The Nasdaq SmallCap Market, the Over-The-Counter Bulletin Board
("OTCBB") or a successor quotation system, the last sale price for the Common
Stock on the day immediately preceding that date as reported by Nasdaq, the
OTCBB or the successor quotation system or, if shares were not traded on that
date, then on the next preceding trading day during which a sale occurred; or
(iii) if the Company's Common Stock is not publicly traded on an exchange and
not quoted on Nasdaq or a successor quotation system, the closing representative
bid price for the Common Stock on that date as determined in good faith by the
Board; or (iv) if the Company's Common Stock is not publicly traded, the fair
market value established by the Board acting in good faith.
4. Term of Option. The Option granted under this Agreement shall expire, unless
otherwise exercised, five years from the Date of Grant, through and including
the normal close of business of the Company on February 18, 2010 ("Expiration
Date"), subject to earlier termination as provided in paragraph 8 below.
5. Exercise of Option. The Option may be exercised by the Optionee as to all or
any part of the Stock then vested by delivery to the Company of written notice
of exercise and payment of the purchase price as provided in paragraphs 6 and 7
below.
6. Method of Exercising Option. Subject to the terms and conditions of this
Agreement, the Option may be exercised by timely delivery to the Company of
written notice, which notice shall be effective on the date received by the
Company ("Effective Date"). The notice shall state the Optionee's election to
exercise the Option, the number of shares in respect of which an election to
exercise has been made, the method of payment elected (see paragraph 7 below),
the exact name or names in which the shares will be registered and the taxpayer
identification number of the Optionee. The notice shall be signed by the
Optionee and shall be accompanied by payment of the purchase price of such
shares. If the Option is exercised by a person or persons other than Optionee
pursuant to paragraph 8 below, the notice shall be signed by the other person or
persons and shall be accompanied by proof acceptable to the Company of the legal
right of the person or persons to exercise the Option. All shares delivered by
the Company upon exercise of the Option shall be fully paid and nonassessable
upon delivery.
7. Method of Payment for Options. Payment for shares purchased upon the exercise
of the Option shall be made by the Optionee in cash or such other method
permitted by the Board and communicated to the Optionee in writing prior to the
date the Optionee exercises all or any portion of the Option.
8. Termination of Service.
8.1 General. If the Optionee's service as a consultant to the Company terminates
for any other reason than for cause (as that term is defined below, referred to
herein as "cause") or voluntary resignation in violation of any agreement to
remain in the service of the Company, then the Optionee may at any time within
three months after the effective date of termination of service exercise the
Option to the extent that the Optionee was entitled to exercise the Option at
the date of termination of service, provided that in no event shall the Option
be exercisable after the Expiration Date. If the Optionee's service as a
consultant to the Company terminates for cause or voluntary resignation in
violation of any agreement to remain in the service of the Company, then the
Option shall terminate immediately upon termination of service, and the Option
shall be deemed to have been forfeited by the Optionee. For purposes of this
Agreement, "cause" may include, without limitation, any illegal or improper
conduct that (1) injures or impairs the reputation, goodwill, or business of the
Company; or (2) involves the misappropriation of funds of the Company, or the
misuse of data, information or documents acquired in connection with employment
by the Company that results in material harm to the Company. A termination for
"cause" may also include any resignation in anticipation of discharge for
"cause" or resignation accepted by the Company in lieu of a formal discharge for
"cause."
8.2 Death or Disability of Optionee. In the event of the death or the disability
(as that term is defined in the Agreement, referred to herein as "Disability")
of the Optionee within a period during which the Option, or any part thereof,
could have been exercised by the Optionee ("Option Period"), the Option shall
lapse unless it is exercised within the Option Period, and in no event later
than twelve months after the date of the Optionee's death or Disability, by the
Optionee or the Optionee's legal representative or representatives in the case
of a Disability or, in the case of death, by the person or persons entitled to
do so under the Optionee's last will and testament or if the Optionee fails to
make a testamentary disposition of the Option or shall die intestate, by the
person or persons entitled to receive the Option under the applicable laws of
descent and distribution. An Option may be exercised following the death or
Disability of the Optionee only if the Option was exercisable by the Optionee
immediately prior to his death or Disability. In no event shall the Option be
exercisable after the Expiration Date. The Committee shall have the right to
require evidence satisfactory to it of the rights of any person or persons
seeking to exercise the Option under this paragraph 8 to exercise the Option.
9. Nontransferability. The Option granted by this Agreement shall be exercisable
only during the term of the Option provided in paragraph 4 above and, except as
provided in paragraph 8 above, only by the Optionee during his lifetime and
while an Optionee of the Company. This Option shall not be transferable by the
Optionee or any other person claiming through the Optionee, either voluntarily
or involuntarily, except by will or the laws of descent and distribution.
10. Adjustments in Number of Shares and Option Price. In the event of a stock
dividend, or if the Stock is changed into or exchanged for a different number or
class of shares of stock of the Company or of another corporation, whether
through reorganization, recapitalization, stock split-up, combination of shares,
merger or consolidation, there shall be substituted for each remaining share of
Stock then subject to this Option the number and class of shares of stock into
which each outstanding share of Stock is to be so exchanged, all without any
change in the aggregate purchase price for the shares then subject to the
Option.
11. Delivery of Shares. No shares of Stock shall be delivered upon exercise of
the Option until (i) the purchase price has been paid in full in the manner
herein provided; (ii) applicable taxes required to be withheld have been paid or
withheld in full; (iii) approval of any governmental authority required in
connection with the Option, or the issuance of shares thereunder, has been
received by the Company; and (iv) if required by the Board, the Optionee has
delivered to the Board an Investment Letter in form and content satisfactory to
the Company as provided in paragraph 12 below.
12. Securities Act. The Company shall not be required to deliver any shares of
Stock pursuant to the exercise of all or any part of the Option if, in the
opinion of counsel for the Company, the issuance would violate the Securities
Act of 1933, as amended ("Securities Act"), or any other applicable federal or
state securities laws or regulations. The Board may require that the Optionee,
prior to the issuance of any shares pursuant to exercise of the Option, sign and
deliver to the Company a written statement ("Investment Letter") stating (i)
that the Optionee is purchasing the shares for investment and not with a view to
the sale or distribution thereof; (ii) that the Optionee will not sell any
shares received upon exercise of the Option or any other shares of the Company
that the Optionee may then own or thereafter acquire except either (a) through a
broker on a national securities exchange or (b) with the prior written approval
of the Company; and (iii) containing such other terms and conditions as counsel
for the Company may reasonably require to assure compliance with the Securities
Act or other applicable federal or state securities laws and regulations. The
Investment Letter shall be in form and content acceptable to the Board in its
sole discretion.
13. Federal and State Taxes. Upon exercise of the Option, or any part thereof,
the Optionee may incur certain liabilities for federal, state or local taxes,
and the Company may be required by law to withhold taxes for payment to taxing
authorities. Upon determination by the Company of the amount of taxes required
to be withheld, if any, with respect to the shares to be issued pursuant to the
exercise of the Option, the Optionee shall pay all federal, state and local tax
withholding requirements to the Company.
14. Administration. This Agreement shall be administered by the Board in
its sole and complete discretion, and decisions of the majority of the Board
with respect thereto and to this Agreement shall be final and binding upon the
Optionee and the Company.
15. Continuation of Services. This Agreement shall not be construed to confer
upon the Optionee any right to continue as a consultant to the Company and shall
not limit the right of the Company, in its sole discretion, to terminate the
services of the Optionee at any time.
16. Obligation to Exercise. The Optionee shall have no obligation to exercise
the Option evidenced by this Agreement.
17. Governing Law. The corporate laws of the State of Delaware shall govern all
issues concerning the relative rights of the Company and the Optionee under the
Option. All other questions and obligations under the Option shall be construed
and enforced in accordance with the internal laws of the State of California,
without giving effect to any choice of law or conflict of law provision or rule
(whether of the State of California or any other jurisdiction) that would cause
the application of the laws of any jurisdiction other than the State of
California. The Company and the Optionee hereby consent, in any dispute, action,
litigation or other proceeding concerning the Option (including arbitration) to
the jurisdiction of the courts of the State of California, with the County of
Orange being the sole venue for the bringing of the action or proceeding.
18. Amendments. This Agreement may be amended only by a written agreement
executed by the Company and the Optionee. The Company and the Optionee
acknowledge that changes in federal tax laws enacted subsequent to the Date of
Grant, and applicable to stock options, may provide for tax benefits to the
Company or the Optionee. In that event, the Company and the Optionee agree that
this Agreement may be amended as necessary to secure for the Company and the
Optionee any benefits that may result from that legislation. Any amendment shall
be made only upon the mutual consent of the parties, which consent (of either
party) may be withheld for any reason.
IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed by
its officer thereunto duly authorized, and the Optionee has hereunto set his or
her hand as of the date first written above.
NETGURU, INC. OPTIONEE
By: _______________________ _______________
Chief Executive Officer [Optionee Name]