CRYOPORT SYSTEMS, INC. STOCK OPTION AGREEMENT (INCENTIVE STOCK OPTION)
CRYOPORT
SYSTEMS, INC.
(INCENTIVE
STOCK OPTION)
This
Stock Option Agreement (the “Agreement”) is made and entered into effective as
of the date set forth on the Signature Page attached hereto by and between
Cryoport Systems, Inc., a California corporation (the “Company”), and that
person identified on the Signature Page attached hereto (the “Optionee”). This
option is intended to qualify as an “incentive stock option” within the meaning
of Section 422 of the Internal Revenue Code, as amended (the
“Code”).
The
grant
hereunder is in connection with and in furtherance of the Company’s compensatory
benefit plan for participation by the Company’s employees (including officers),
directors or consultants. Defined terms not explicitly defined in this agreement
but defined in the Cryoport Systems, Inc. 2002 Stock Incentive Plan (the “Plan”)
shall have the same definitions as in the Plan.
1. Grant
of Option.
Subject
to the vesting provisions of Sections 3 and 4, the Company hereby grants to
Optionee, as of the date hereof the right and option to purchase, on the terms
and conditions hereinafter set forth, all or any part of the aggregate number
of
shares of Common Shares set forth on the Signature Page attached hereto (the
“Option”), subject to adjustment in accordance with the provisions of Section 18
below. The Plan provides for the issuance of Incentive Stock Options (“ISO”).
Subject to Section 25, it is understood and acknowledged that (a) if the
Optionee complies with the terms of this Agreement, (b) the Option was
designated as an ISO at the time of grant and (c) the Optionee is an employee
of
the Company at all times from the date of this Agreement through the date which
is three (3) months prior to the exercise of the Option, the Option is intended
to be an Incentive Stock Option which will qualify under Section 422(b) of
the
Code.
2. Purchase
Price.
The
Purchase Price is 100% of the fair market value of the Common Shares at the
time
that the Option is granted (110% of such fair market value if the Option is
granted to a 10% shareholder).
3. Right
to Exercise.
The
right to exercise the Option shall vest in accordance with the schedule set
forth on the Signature Page. Notwithstanding the foregoing, the Option shall
automatically fully vest (i.e., become exercisable) as to all of the Common
Shares subject to the Option in the event that a Change in Control (as defined
in Section 14.4 of the Plan) occurs with respect to the Company, subject to
the
limitations set forth in Section 14.4 of the Plan.
4. Securities
Law Requirements.
No part
of the Option shall be exercised if counsel to the Company determines that
any
applicable registration requirement under the Securities Act of 1933, as
amended, or any other applicable requirement of Federal or state law has not
been met.
5. Term
of Option.
The
Option shall terminate in any event on the earliest of (a) the date set forth
on
the Signature Page, (b) the expiration of the period described in Section 6
below, (c) the expiration of the period described in Section 7 below, (d) the
expiration of the period described in Section 8 below; (e) the expiration of
the
period described in Section 9 below; or (f) the expiration of ten (10) years
(five (5) years in the case of an Option granted to a 10% shareholder) from
the
date the Option was granted.
6. Exercise
Following Termination of Employment, Except By Death, Disability or
Retirement.
If the
Optionee’s service with the Company terminates for any reason other than death,
disability or retirement, the Option (to the extent it has not previously been
exercised and is then exercisable) may be exercised within the period of thirty
(30) consecutive days commencing immediately following the date of such
termination (but not later than the termination date set forth in Section 5(a)
above). The foregoing notwithstanding, the Option shall cease to be exercisable
on the date of such termination if the termination is for cause. For this
purpose, “cause” shall mean conviction of a felony, misappropriation of assets
of the Company or any subsidiary, continued or repeated insobriety, continued
or
repeated absence from service during the usual working hours of the Optionee’s
position for reason other than disability or sickness, or refusal to carry
out
the reasonable directions of the Company’s Board of Directors or senior
executive officers.
7. Exercise
Following Death.
If the
Optionee’s service with the Company terminates by reason of the Optionee’s
death, or if the Optionee dies after termination of service but while the Option
would have been exercisable hereunder, the Option (to the extent it has not
previously been exercised and is then exercisable) may be exercised within
six
(6) months after the date of Optionee’s death (but not later than the
termination date set forth in Section 5(a) above). The exercise may be made
by
Optionee’s representative or by the person entitled thereto under Optionee’s
will or the laws of descent and distribution; provided that such representative
or such person consents in writing to abide by and be subject to the terms
of
this Agreement and such writing is delivered to the President of the
Company.
8. Exercise
Following Disability.
If the
Optionee’s service with the Company terminates by reason of the Optionee’s
disability, the Option (to the extent not previously exercised and is then
exercisable) may be exercised for a period of thirty (30) days after the date
of
termination for reason of disability (but not later than the termination date
set forth in Section 5(a) above).
9. Exercise
Following Retirement.
If the
Optionee’s service with the Company terminates by reason of retirement, pursuant
to the Company’s formal retirement policy, the Option (to the extent it has not
previously been exercised and is then exercisable) may be exercised within
thirty (30) consecutive days after the date of the Optionee’s retirement (but
not later than the termination date set forth in Section 5(a)
above).
10. Time
of Termination of Service.
For the
purposes of this Agreement, Optionee’s service shall be deemed to have
terminated on the earlier of (a) the date when Optionee’s service in fact
terminated or (b) the date when the Optionee gave or received written notice
that his or her service is to terminate.
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11. Nontransferability.
Unless
the Company otherwise consents in writing, the Option and all rights and
privileges granted hereunder shall be non-assignable and non-transferable by
the
Optionee, either voluntarily or by operation of law, except by will or by
operation of the laws of descent and distribution, shall not be pledged or
hypothecated in any way, and shall be exercisable during lifetime only by the
Optionee. Except as otherwise provided herein, any attempted alienation,
assignment, pledge, hypothecation, attachment, execution or similar process,
whether voluntary or involuntary, with respect to all or any part of the Option
or any right thereunder, shall be null and void and, at the Company’s option,
shall cause all of Optionee’s rights under this Agreement to
terminate.
12. Effect
of Exercise.
Upon
exercise of all or any part of the Option, the number of shares of Common Shares
subject to the Option under this Agreement shall be reduced by the number of
shares with respect to which such exercise is made.
13. Partial
Exercise.
Any
exercisable portion of the Option or the entire Option, if then wholly
exercisable, may be exercised in whole or in part at any time prior to the
time
when the Option or portion thereof becomes unexercisable under Section 5;
provided, however, that each partial exercise shall be for not less than one
hundred (100) shares and shall be for whole shares only.
14. Method
of Exercise.
Each
exercise of the Option shall be by means of a written notice of exercise in
substantially the form of attached Exhibit A delivered to the Secretary of
the
Company at its principal office and accompanied by payment in full of the option
price for each share of Common Shares purchased under the Option. Such notice
shall specify the number of shares of Common Shares with respect to which the
Option is exercised and shall be signed by the person exercising the Option.
If
the Option is exercised by a person other than the Optionee, such notice shall
be accompanied by proof, reasonably satisfactory to the Company, of such
person’s right to exercise the Option.
The
Purchase Price specified in Section 2 above shall be paid in full upon the
exercise of the Option (i) by cash or check, in United States dollars or (ii)
in
any other form determined by the Board of Directors and that is consistent
with
applicable laws, rules and regulations.
15. Withholding
Taxes.
If the
Optionee is an employee or former employee of the Company when all or part
of
the Option is exercised, unless the Option qualifies as an ISO under Section
422
of the Code, the Company may require the Optionee to deliver payment of any
withholding taxes (in addition to the Option exercise price) in cash with
respect to the difference between the Option exercise price and the Fair Market
Value of the Common Shares acquired upon exercise. Alternatively, the Company
may accept shares having a Fair Market Value equal to the amount of the
withholding taxes.
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16. Issuance
of Shares.
Subject
to the foregoing conditions, the Company, as soon as reasonably practicable
after receipt of a proper notice of exercise and without transfer or issue
tax
or other incidental expense to the person exercising the Option, shall deliver
to such person at the principal office of the Company, or such other location
as
may be acceptable to the Company and such person, one or more certificates
for
the shares of Common Shares with respect to which the Option has been exercised.
Such shares shall be fully paid and non-assessable and shall be issued in the
name of such person. However, at the request of the Optionee, such shares may
be
issued in the names of the Optionee and his or her spouse (a) as joint tenants
with right of survivorship, (b) as community property or (c) as tenants in
common without right of survivorship.
17. Limitation
of Optionee’s Rights.
Neither
Optionee nor any person entitled to exercise the Option shall be or have any
of
the rights of a shareholder of the Company in respect of any share issuable
upon
the exercise of the Option unless and until a certificate or certificates
representing shares of Common Shares shall have been issued and delivered upon
exercise of the Option in full or in part. No adjustment shall be made for
dividends or other rights for which the record date is prior to the date such
stock certificates are issued. This Option is not an employment contract and
nothing in this Option shall be deemed to create in any way whatsoever any
obligation on Optionee’s part to continue in the employ of the Company, or of
the Company to continue Optionee’s employment with the Company. In addition,
nothing in this Option shall obligate the Company or any Affiliate of the
Company, or their respective shareholders, Board of Directors, officers or
employees to continue any relationship which Optionee might have as an Outside
Director or Consultant for the Company or Affiliate of the Company.
18.
Consent
Required to Transfer.
In
connection with any underwritten public offering by the Company of its equity
securities pursuant to an effective registration statement filed under the
Securities Act of 1933, as amended, including the Company’s initial public
offering, Optionee shall not sell, make any short sale of, loan, hypothecate,
pledge, grant any option for the purchase of, or otherwise dispose or transfer
for value or otherwise agree to engage in any of the foregoing transactions
with
respect to, any shares of Common Shares purchased under the Option without
the
prior written consent of the Company or its underwriters. Such limitations
shall
be in effect for such period of time from and after the effective date of such
registration statement as may be requested by the Company or such
underwriters.
19. Recapitalizations.
Subject
to the provisions of the Plan, if the outstanding shares of the class then
subject to this Option are adjusted for any increase or decrease in the number
of issued shares of Common Shares resulting from a subdivision or consolidation
of Common Shares or the payment of a stock dividend (but only of Common Shares)
or any other increase or decrease in the number of issued shares of Common
Shares effected without receipt of consideration by the Company, appropriate
adjustments shall be made in the number and/or kind of shares or securities
for
which the unexercised portions of this Option may thereafter be exercised,
all
without any change in the aggregated exercise price applicable to the
unexercised portions of this Option, but with a corresponding adjustment in
the
exercise price per share or other unit. Subject to the provisions of the Plan,
if the Company is the surviving corporation in any merger or consolidation,
this
Option shall pertain and apply to the securities to which a holder of the number
of Common Shares subject to the Option would have been entitled. In the event
of
a merger or consolidation in which the Company is not the surviving corporation,
the date of exercisability of this Option shall be accelerated to a date prior
to such merger or consolidation, unless the agreement of merger or consolidation
provides for the assumption of the Option by the successor to the Company.
To
the extent that the foregoing adjustments relate to securities of the Company,
such adjustments shall be made by the Board, whose determination shall be
conclusive and binding on all persons. Except as expressly provided in this
Section 19, the Optionee shall have no rights by reason of subdivision or
consolidation of shares of any class, the payment of any Common Share dividend
or any other increase or decrease in the number of shares of any class or by
reason of any dissolution, liquidation, merger or consolidation or spin-off
of
assets or shares of another corporation, and any issue by the Company of shares
of any class, or securities convertible into shares of any class, shall not
affect, and no adjustment by reason thereof shall be made with respect to,
the
number or Purchase Price of Common Shares subject to this Option.
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20. Restricted
Stock Provisions.
In
addition to certain Federal and state securities laws restrictions, until such
time as the Company shall have consummated an initial public offering of its
Common Shares, the shares of Common Shares issued on exercise of this Option
shall upon issuance be subject to the following restrictions (and, as used
herein, “restricted stock” means shares issued on exercise of this Option which
are still subject to the restrictions imposed under this Section that have
not
yet expired or terminated):
(a) Such
shares of restricted stock may not be sold or otherwise transferred or
hypothecated;
(b) If
the
employment of the Optionee with the Company or a subsidiary of the Company
is
terminated for any reason, other than his or her death, normal or early
retirement in accordance with his or her employer’s established retirement
policies and practices, or total disability, the Company (or any subsidiary
designated by it) shall have the option for sixty (60) days after such
termination of employment to purchase for cash all or any part of his or her
restricted stock at the Fair Market Value of the restricted stock on the date
of
such termination of employment (for which purpose Fair Market Value shall have
the same meaning as set forth in the Plan);
(c) The
restrictions imposed under Section 20 shall apply as well to all shares or
other
securities issued in respect of restricted stock in connection with any stock
split, reverse stock split, stock dividend, recapitalization, reclassification,
spin-off, split-off merger, consolidation or reorganization, but such
restrictions imposed under Section 20 shall expire or terminate on the earliest
to occur of the following:
(i) The
ninetieth (90th)
day
after the date on which shares of the same class of Common Shares as such
restricted stock first become publicly traded;
(ii) The
fifth
(5th)
anniversary of the date of grant hereof;
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(iii) As
to any
shares for which the Company’s (or a subsidiary’s) sixty (60) day option to
purchase upon termination of employment shall have become exercisable but shall
expire without having been exercised, on the first business day of the calendar
month next following the expiration of such sixty (60) day option period;
or
(iv) The
occurrence of any event or transaction upon which this Option terminated by
reason of the provisions of Section 19 hereof.
(d) All
certificates representing shares of Common Shares purchased upon the exercise
of
the Option shall bear the following legends:
“THE
SALE OF THE SECURITIES REPRESENTED HEREBY HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). ANY TRANSFER OF SUCH SECURITIES
WILL BE INVALID UNLESS A REGISTRATION STATEMENT UNDER THE ACT IS IN EFFECT
AS TO
SUCH TRANSFER OR IN THE OPINION OF COUNSEL FOR THE ISSUER SUCH REGISTRATION
IS
UNNECESSARY IN ORDER FOR SUCH TRANSFER TO COMPLY WITH THE
ACT.”
21. Stock
Incentive Plan.
This
Agreement is subject to, and the Company and the Optionee agree to be bound
by,
all of the terms and conditions of the Company’s 200_ Stock Incentive Plan under
which this Option was granted, as the same shall have been amended from time
to
time in accordance with the terms thereof, provided that no such amendment
shall
deprive the Optionee, without his or her consent, of this Option or any of
his
or her rights hereunder. Pursuant to said Plan, the Board of Directors of the
Company or its Committee established for such purposes is vested with final
authority to interpret and construe the Plan and this Option, and is authorized
to adopt rules and regulations for carrying out the Plan. A copy of the Plan
in
its present form is available for inspection during business hours by the
Optionee or other persons entitled to exercise this Option at the Company’s
principal office.
22. Notices.
Any
notice to the Company contemplated by this Agreement shall be addressed to
it in
care of its President; any notice to the Optionee shall be addressed to him
or
her at the address on file with the Company on the date hereof or at such other
address as Optionee may hereafter designate in a writing delivered to the
Company as provided herein.
23. Interpretation.
The
interpretation, construction, performance and enforcement of this Agreement
shall lie within the sole discretion of the Board, and the Board’s
determinations shall be conclusive and binding on all interested
persons.
24. Governing
Law.
This
Agreement has been made, executed and delivered in, and the interpretation,
performance and enforcement hereof shall be governed by and construed under
the
laws of the State of California.
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25. Effect
of Early Disposition.
If the
Optionee exercises an Option granted as an ISO within two (2) years of the
date
on which the Option was granted, or disposes of the stock obtained by the
exercise of the Option within one (1) year from the date of such exercise,
whichever is later, the Option will be a Nonqualified Stock Option, and the
gain, if any, on exercise will be treated as compensation rather than as capital
gain. The Optionee agrees to notify the Company of such early exercise of the
Option or disposition of the stock acquired within thirty (30) days thereof.
Optionee shall not be required to hold the Common Shares for any period of
time
following exercise, unless legal counsel to the Company shall reasonably
determine that such a sale would violate federal or state securities laws.
********************
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SIGNATURE
PAGE
INCENTIVE
STOCK OPTION AGREEMENT
PURSUANT
TO
CRYOPORT
SYSTEMS, INC.
2002
STOCK INCENTIVE PLAN
| Date of Grant: | ______________________________ |
| Exercise Price: | ______________________________ |
| Number of Shares: | ______________________________ |
| Vesting Schedule: | ______________________________ |
| ______________________________ | |
| ______________________________ | |
| ______________________________ | |
| ______________________________ |
Notwithstanding
the foregoing, the Option shall automatically fully vest upon a Change in
Control (as defined in Section 14.4 of the Plan), subject to the limitations
set
forth in Section 14.4 of the Plan.
Expiration
Date:
I
have
read the Incentive Stock Option Agreement indicated above which was adopted
for
use in connection with the 2002 Stock Incentive Plan. I have also received
and
reviewed a copy of the 2002 Stock Incentive Plan. As Optionee, I hereby
acknowledge that as of the date of grant of this option, it sets forth the
entire understanding between the undersigned Optionee and the Company and its
Affiliates regarding the acquisition of stock in the Company and supersedes
all
prior oral and written agreements on that subject with the exception of (i)
the
options and any other stock awards previously granted and delivered to the
undersigned under stock award plans of the Company, and (ii) the following
agreements only:
NONE
_________
(Initial)
OTHER
___________________________________________________________________
8
IN
WITNESS WHEREOF, this Incentive Stock Option Agreement has been delivered by
the
parties hereto.
| Date: ______________________ |
"Optionee"
|
| _________________________________ | |
| Name _________________________________ | |
| Address _______________________________ | |
| ______________________________________ | |
| _________________________________ | |
| Social Security Number _________________ |
The
Company hereby agrees to
all
the
terms of the Agreement.
Cryoport
Systems, Inc.
By:
___________________________________
Name:
_________________________________
Title:
__________________________________
9
EXHIBIT
A
OPTION
EXERCISE FORM
(To
be
executed only upon exercise of Option)
The
undersigned holder of the Option hereby irrevocably exercises the Option for
the
purchase of that number of shares of the Common Shares, no par value, of
CRYOPORT SYSTEMS, INC. set forth below, up to a maximum of __________ shares
(or
such other number of shares as may be issuable upon the exercise of the Option
pursuant to the adjustment provisions of the Agreement), and hereby makes
payment of the aggregate Purchase Price therefore which is also set forth below,
all on the terms and subject to the conditions specified in this
Agreement.
| Number of Shares: | __________________ |
| x | |
| Exercise Price: | $_________________ |
| Aggregate Exercise Price Paid: | $_________________ |
Dated: _________________________
| HOLDER: | |
| ___________________________ | |
| (Signature) | |
| ___________________________ | |
| (Please print) |
ACCEPTED:
CRYOPORT
SYSTEMS, INC.
By:
___________________________________
Name:
_________________________________
Title:
__________________________________