EXHIBIT 10.41
WHITE ELECTRONIC DESIGNS CORPORATION
NON-QUALIFIED STOCK OPTION AGREEMENT
This Option Agreement is entered into between White Electronic
Design Corporation ("Company") and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ("Optionee"), as of the 3rd
day of December, 1998 ("Date of Grant").
RECITALS
A. The Board has approved the option grant to the Optionee to provide
an incentive to the Optionee to focus on the long-term growth of the Company.
In consideration of the mutual covenants and conditions in this
Agreement, the Company and the Optionee agree as follows:
1. GRANT OF OPTION. The Company grants to the Optionee the option
("Option") to purchase 102,000 shares of the Common Stock of White Electronic
Designs Corporation (the "Stock") on the terms and conditions in this Agreement.
This Option may be exercised in whole or in part and from time to time as
provided in this Agreement. 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 (the "Code").
2. VESTING OF OPTION. The Option shall vest and become exercisable in
accordance with the schedule below:
(a) One-Third of the shares set forth above will vest on the first
anniversary of the Date of Grant.
(b) Two-Thirds of the shares set forth above will vest in 24 equal
monthly installments beginning one month after the first anniversary of the date
of the grant.
3. PURCHASE PRICE. The price at which the Optionee is entitled to
purchase the Stock covered by the Option shall be $1.125 per share.
4. TERM OF OPTION. The Option granted under this Agreement will expire,
unless otherwise exercised, 10 years from the Date of Grant, through and
including the normal close of business of the Company on December 2, 2008
("Expiration Date"), subject to earlier termination as provided in paragraph 8
hereof.
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 hereof.
6. METHOD OF EXERCISING OPTION. Subject to the terms and conditions of
this Option 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 hereof), the exact name or names, address(es) and Social Security Number(s) of
the individual(s) in which the shares will be registered and the Social Security
number of the Optionee. Such notice shall be signed by the Optionee and shall be
accompanied by payment of the purchase price of such shares. In the event the
Option shall be exercised by a person or persons other than Optionee pursuant to
paragraph 8 hereof, such notice shall be signed by such other person or persons
and shall be accompanied by proof acceptable to the Company of the legal right
of such 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,
previously-acquired Stock held for more than six months (through actual tender
or by attestation), broker-assisted cashless exercise arrangement, 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. If the Optionee terminates service with the
Company for any reason, the Optionee (or the Optionee's designated beneficiary
in the event of death) may at any time within 12 months after the effective date
of termination of service with the Company exercise the Option to the extent
that the Optionee was entitled to exercise the Option at the date of
termination. In no event shall the Option be exercisable after the Expiration
Date.
9. NONTRANSFERABILITY. The Option shall be exercisable only during the
term of the Option provided in paragraph 4 and, except as provided in paragraph
8 above, only by the Optionee during his or her lifetime. Unless otherwise
provided in writing by the Board, the 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. Any
attempted sale, pledge, assignment, hypothecation, transfer or other disposition
of the Option contrary to the provisions of this Agreement shall be null and
void and without effect and, upon the happening of any such event, the Board, in
its sole discretion, may terminate the Option.
10. MARKET STAND-OFF AGREEMENT. The Optionee, if requested by the
Company and an underwriter of Stock (or other securities) of the Company, agrees
not to sell or otherwise transfer or dispose of any Stock (or other securities)
of the Company held by the Optionee during the period not to exceed one hundred
eighty (180) days as requested by the managing underwriter following the
effective date of a registration statement of the Company filed under the
Securities Act. Such agreement shall be in writing in a form satisfactory to the
Company and such underwriter. The Company may impose stop transfer instructions
with respect to the Stock (or other securities) subject to the foregoing
restriction until the end of such project.
11. ADJUSTMENTS IN NUMBER OF SHARES AND OPTION PRICE. In the event of a
stock dividend or in the event the Stock shall be 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,
spin-off, spin-out, combination or exchange of shares, merger or consolidation,
there shall be substituted for each such remaining share of Stock then subject
to this Option the number and class of shares of stock into which each
outstanding share of Stock shall be so exchanged, all without any change in the
aggregate purchase price for the shares then subject to the Option, all as
determined by the Board of Directors.
Neither the issuance of shares for a consideration, the issuance of
rights or options to acquire shares, nor the issuance of shares on the
conversion of a debenture of capital stock, shall be considered a change in the
Company's capital structure for these purposes. However, the Board may make or
provide for such adjustments in the number and/or kind of shares as the Board in
its sole discretion may determine is appropriate to reflect any event of the
type described in the preceding sentence.
No fractional shares shall be issued upon any exercise of the Option
following an adjustment made pursuant to this paragraph, and the purchase price
to be paid shall be appropriately adjusted on account of any fractional share
not issued upon such an exercise.
12. DELIVERY OF SHARES. No shares of Stock shall be delivered upon
exercise of the Option until (i) the purchase price shall have 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 14 hereof.
13. NO PRIVILEGE OF STOCK OWNERSHIP. The Optionee shall not have any
rights of a stockholder with respect to the shares covered under this Agreement
until such Optionee shall have exercised the option, paid the purchase price,
and received a stock certificate for the purchased shares of Stock.
14. 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, such issuance would violate the
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 such 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
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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. Such
Investment Letter shall be in form and content acceptable to the Board in its
sole discretion.
15. 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 such 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.
16. ADMINISTRATION. This Option Agreement shall be administered by the
Board. The Board shall have the sole and complete discretion with respect to all
matters and decisions of the majority of the Board with respect to this Option
Agreement shall be final and binding upon the Optionee and the Company.
17. CONTINUATION OF SERVICES. This Option Agreement shall not be
construed to confer upon the Optionee any right to continue in the service of
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.
18. OBLIGATION TO EXERCISE. The Optionee shall have no obligation to
exercise any option granted by this Agreement.
19. GOVERNING LAW. This Option Agreement shall be interpreted and
administered under the laws of the State of Arizona.
20. AMENDMENTS. This Option 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 any such event, the Company and the Optionee agree
that this Option Agreement may be amended as necessary to secure for the Company
and the Optionee any benefits that may result from such legislation. Any such
amendment shall be made only upon the mutual consent of the parties, which
consent (of either party) may be withheld for any reason.
21. NOTICES. Each notice relating to this Agreement shall be in writing
and delivered in person or by certified mail to the proper address. Each notice
shall be deemed to have been given on the date it is received. Each notice to
the Company shall be addressed to ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
▇▇▇▇▇, to the attention of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇. Each notice to the Optionee, or
other person or persons then entitled to exercise the Option, shall be addressed
to the Optionee, or such other person or persons, at the Optionee's address
specified below. Anyone to whom a notice may be given under this Agreement may
designate a new address by notice to that effect.
IN WITNESS WHEREOF, the Company has caused this Option Agreement to be
signed by its duly authorized representative and the Optionee has signed this
Option Agreement as of the date first written above.
WHITE ELECTRONIC DESIGNS CORPORATION
By:
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Its: President & CEO
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(Optionee)
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