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EXHIBIT 10.12
STOCK OPTION AGREEMENTS
CYBERGUARD CORPORATION
NON-STATUTORY STOCK OPTION AGREEMENT
This Stock Option Agreement ("Agreement") is entered into as of the
, 199 , between CyberGuard Corporation ("Corporation"), a Florida
corporation having its principal office in Ft. Lauderdale, Florida, and
, ("Employee") of the Corporation or one of its subsidiaries.
1. THE OPTION. Under and subject to the provisions of the Corporation's
Employee Stock Option Plan as in effect from time to time ("Plan"), the
Corporation hereby grants to Employee a non-statutory option to purchase an
aggregate of shares of Common Stock of the Corporation at the price of
U.S. $ per share ("Option"), subject to the following conditions:
(a) The Option shall not be exercisable to any extent until and unless
the Employee shall have remained continuously in the employ of the
Corporation for one year from the date of hire. Nothing herein shall limit
or restrict the Corporation's rights to terminate the Employee's
employment.
(b) During the lifetime of the Employee, the Option shall be
exercisable only by the Employee, and (except when Section 2 is applicable)
only while the Employee continues as an employee of the Corporation.
(c) Notwithstanding any other provision of this Agreement, the Option
shall expire no later than five years from the date hereof and shall not be
exercisable thereafter.
(d) The number of shares of Common Stock with respect to which the
Option may be exercised from time to time is limited to the following
percentages of the aggregate number of shares optioned hereby:
(i) After the end of one year and prior to the end of two years
from the date hereof, not more than thirty-three percent (33.333%);
(ii) After the end of two years and prior to the end of three
years from the date hereof, not more than sixty-six percent (66.666%);
(iii) After the end of three years from the date hereof,
one-hundred percent (100%).
2. TERMINATION OF EMPLOYMENT
(a) DEATH. In the event of the death of the Employee, the Option shall
be (i) exercisable only by the executor or administrator of the Employee's
estate or by the person or persons to whom the Employee's rights under the
Option shall pass by the Employee's will or the laws of descent and
distribution, (ii) exercisable if and to the extent that the
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Option was exercisable at the date of the Employee's death and (iii) shall
remain exercisable for the shorter of (a) one year following Employee's
death or (b) the remainder of the period of exercisability as stated in
Section 1(c).
(b) DISABILITY. In the event of termination of Employee's employment
due to disability of the Employee, the Option shall be exercisable by the
Employee only to the extent that the Option was exercisable at the date of
such cessation of employment, and no more, and shall remain exercisable for
the shorter of (i) one year following Employee's termination of employment
or (ii) the remainder of the period of exercisability as stated in Section
1(c).
(c) RETIREMENT. In the event of Retirement of the Employee, the Option
shall be exercisable by the Employee only to the extent that the Option was
exercisable at the date of such cessation of employment, and no more, and
shall remain exercisable for the shorter of (i) one year following
Employee's termination of employment or (ii) the remainder of the period of
exercisability as stated in Section 1(c). The term "Retirement" is
specially defined in the Plan; generally, a termination in service from the
Company will be covered by provisions regarding terminations for reasons
other than death, disability, or Retirement, and not this paragraph.
(d) TERMINATION OF EMPLOYMENT. In the event of termination of
Employee's employment for reasons other than death, disability or
Retirement, the Option shall be exercisable by the Employee only to the
extent that it was exercisable at the date of such cessation of employment,
and no more, and shall remain exercisable for the shorter of (i) three (3)
months following Employee's termination of employment or (ii) the remainder
of the period of exercisability as stated in Section 1(c).
(e) CHANGE OF CONTROL. If a "Change of Control" (as defined in the
Plan) shall occur and Employee's employment is thereafter terminated by the
Corporation, then the Options shall become 100% immediately exercisable in
full (to the extent that they otherwise have not expired) and shall remain
exercisable for the shorter of (i) one year following Employee's
termination of employment or (ii) the remainder of the period of
exercisability as stated in Section 1(c).
Notwithstanding the foregoing provisions of this section 2, in the event that:
(x) the Employee has entered into an Employment Agreement with the Corporation
(the "Employment Agreement"); and (y) if Employee's Employment Agreement is
terminated under circumstances that give Employee a longer period of exercise or
greater rights than those set forth in this Agreement, then the terms and
conditions governing exercisability and continuation of the Option after
termination of Employment contained in the Employment Agreement shall supersede
those set forth in this Agreement.
3. EXERCISE OF OPTION. The Option may be exercised by delivering to the
Corporation at the office of the Corporate Secretary (a) a written notice,
signed by the person entitled to exercise the Option, stating the number of
shares such person then elects to purchase hereunder, (b) payment in an amount
equal to the full purchase price of the shares then to be purchased, and (c) in
the event the Option is exercised by any person other than the Employee,
evidence satisfactory to the Corporation that such person has the right to
exercise the Option. If it is required (in the estimation of the Corporation),
the Corporation also may require
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the payment of any withholding or other applicable taxes at the time of exercise
of the Option. Payment shall be made (i) in cash, (ii) in previously acquired
shares of Common Stock of the Corporation, valued at their Fair Market Value on
the day preceding the exercise date of the Option, or (iii) in any combination
of cash and such shares. Shares tendered in payment of the purchase price which
have been acquired through an exercise of a stock option shall have been held at
least six (6) months prior to exercise of the Option. Upon the due exercise of
the Option, the Corporation shall issue in the name of the person exercising the
Option, and deliver to the Employee, one or more certificates for the shares in
respect of which the Option shall have been so exercised. The Employee
acknowledges that the Employee does not have any rights as a shareholder in
respect of any shares as to which the Option shall not have been duly exercised
and that no rights as a shareholder shall arise in respect of any such shares
until and except to the extent that a certificate or certificates for such
shares shall have been issued.
4. PROHIBITION AGAINST TRANSFER. The Option and rights granted by the
Corporation under this Agreement are not transferable except by will or the laws
of descent and distribution. Without limiting the generality of the foregoing,
the Option may not be assigned, transferred except as aforesaid, pledged or
hypothecated, shall not be assignable by operation of law, and shall not be
subject to execution, attachment or similar process. Any attempted assignment,
transfer, pledge, hypothecation or other disposition of the Option contrary to
the provisions hereof, or the levy of any execution, attachment or similar
process upon the Option, shall be null and void and without effect.
5. ADJUSTMENTS. In case there shall be a merger, reorganization,
consolidation, recapitalization, stock dividend, a change in corporate structure
such that shares of Common Stock are changed into or become exchangeable for a
larger or smaller number of shares, or an issuance of Common Stock by the
Corporation in exchange for which the Corporation (or its then current
shareholders, on a pro-rata basis) does not receive cash or other property, the
number of shares subject to outstanding Options shall be increased or decreased
in direct proportion to the increase or decrease in the number of shares of
Common Stock by reason of such change in corporate structure. The number of
shares shall always be a whole number, and the purchase price per share of any
outstanding Options shall, in the case of an increase in the number of shares,
be proportionately reduced, and in the case of a decrease in the number of
shares, shall be proportionately increased.
6. EMPLOYMENT BY PARENT, SUBSIDIARY OR SUCCESSOR. For the purpose of this
Agreement, employment by a parent or subsidiary of or a successor to the
Corporation shall be considered employment by the Corporation. "Parent" and
"subsidiary" as used herein shall have the meaning of "parent" and "subsidiary
corporation," respectively, as defined in Section 424 of the Internal Revenue
Code of 1986, as amended, or subsequent comparable statute.
7. COMMITTEE. The Corporation's Board of Directors and the Committee
administering the Plan shall have authority, subject to the express provisions
of the Plan as in effect from time to time, to construe this Agreement and the
Plan, to establish, amend and rescind rules and regulations relating to the
Plan, and to make all other determinations in the judgment of the Committee
necessary or desirable for the administration of the Plan. The Committee may
correct any defect or supply any omission or reconcile any inconsistency in this
Agreement in the manner and to the extent it shall deem expedient to carry the
Plan into effect, and it shall be the sole and final judge of such expediency.
8. INCORPORATION OF PLAN PROVISIONS. This Agreement is made pursuant to the
Plan, the terms and conditions of which are hereby incorporated by reference.
Capitalized terms not otherwise defined
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herein have the meanings set forth in the Plan. In the event of a conflict
between the terms of this Agreement and the Plan, the terms of the Plan shall
govern.
9. MISCELLANEOUS.
(i) Words such as "herein", "hereof" and "hereunder" when used in this
Agreement shall refer to this Agreement as a whole unless the context
requires otherwise.
(ii) This Agreement embodies the entire agreement between the parties
hereto with respect to the Option.
(iii) This Agreement shall be governed by and construed in accordance
with the laws of the State of Florida.
(iv) This Agreement may be amended or modified only in a written
document executed by both of the parties hereto.
(v) No waiver of any provision of this Agreement shall in any event be
effective unless the same shall be in writing and signed by the party
granting such waiver and then such waiver shall be effective only in the
specific instance and for the specific purpose for which given.
IN WITNESS WHEREOF, the parties hereto have executed this Stock Option
Agreement in duplicate as of the day and year first above written.
CYBERGUARD CORPORATION EMPLOYEE
By:
------------------------------------- --------------------------------
Xxxxx X. Xxxxxx, President and
Chief Operating Officer
CYBERGUARD CORPORATION
INCENTIVE STOCK OPTION AGREEMENT
This Stock Option Agreement ("Agreement") is entered into as of the
, 199 , between CyberGuard Corporation ("Corporation"), a Florida
corporation having its principal office in Ft. Lauderdale, Florida, and
, ("Employee") of the Corporation or one of its subsidiaries.
1. THE OPTION. Under and subject to the provisions of the Corporation's
Stock Incentive Plan as in effect from time to time ("Plan"), the Corporation
hereby grants to Employee an incentive stock option, that is intended to comply
with Section 422 of the Internal Revenue Code, to purchase an aggregate of
shares of Common Stock of the Corporation at the price of U.S. $ per share
("Option"), subject to the following conditions:
(a) The Option shall not be exercisable to any extent until and unless
the Employee shall have remained continuously in the employ of the
Corporation for one year from the date of hire. Nothing herein shall limit
or restrict the Corporation's rights to terminate the Employee's
employment.
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(b) During the lifetime of the Employee, the Option shall be
exercisable only by the Employee, and (except when Section 2 is applicable)
only while the Employee continues as an employee of the Corporation.
(c) Notwithstanding any other provision of this Agreement, the Option
shall expire no later than five years from the date hereof and shall not be
exercisable thereafter.
(d) The number of shares of Common Stock with respect to which the
Option may be exercised from time to time is limited to the following
percentages of the aggregate number of shares optioned hereby:
(iv) After the end of one year and prior to the end of two years
from the date hereof, not more than thirty-three percent (33.333%);
(v) After the end of two years and prior to the end of three
years from the date hereof, not more than sixty-six percent (66.666%);
(vi) After the end of three years from the date hereof,
one-hundred percent (100%).
2. TERMINATION OF EMPLOYMENT
(a) DEATH. In the event of the death of the Employee, the Option shall
be (i) exercisable only by the executor or administrator of the Employee's
estate or by the person or persons to whom the Employee's rights under the
Option shall pass by the Employee's will or the laws of descent and
distribution, (ii) exercisable if and to the extent that the Option was
exercisable at the date of the Employee's death and (iii) shall remain
exercisable for the shorter of (a) one year following Employee's death or
(b) the remainder of the period of exercisability as stated in Section
1(c).
(b) DISABILITY. In the event of termination of Employee's employment
due to disability of the Employee, the Option shall be exercisable by the
Employee only to the extent that the Option was exercisable at the date of
such cessation of employment, and no more, and shall remain exercisable for
the shorter of (i) one year following Employee's termination of employment
or (ii) the remainder of the period of exercisability as stated in Section
1(c).
(c) RETIREMENT. In the event of Retirement of the Employee, the Option
shall be exercisable by the Employee only to the extent that the Option was
exercisable at the date of such cessation of employment, and no more, and
shall remain exercisable for the shorter of (i) one year following
Employee's termination of employment or (ii) the remainder of the period of
exercisability as stated in Section 1(c). The term "Retirement" is
specially defined in the Plan; generally, a termination in service from the
Company will be covered by provisions regarding terminations for reasons
other than death, disability, or Retirement, and not this paragraph.
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(d) TERMINATION OF EMPLOYMENT. In the event of termination of
Employee's employment for reasons other than death, disability or
Retirement, the Option shall be exercisable by the Employee only to the
extent that it was exercisable at the date of such cessation of employment,
and no more, and shall remain exercisable for the shorter of (i) three (3)
months following Employee's termination of employment or (ii) the remainder
of the period of exercisability as stated in Section 1(c).
(e) CHANGE OF CONTROL. If a "Change of Control" (as defined in the
Plan) shall occur and Employee's employment is thereafter terminated by the
Corporation, then the Options shall become 100% immediately exercisable in
full (to the extent that they otherwise have not expired) and shall remain
exercisable for the shorter of (i) one year following Employee's
termination of employment or (ii) the remainder of the period of
exercisability as stated in Section 1(c).
Notwithstanding the foregoing provisions of this section 2, in the event that:
(x) the Employee has entered into an Employment Agreement with the Corporation
(the "Employment Agreement"); and (y) if Employee's Employment Agreement is
terminated under circumstances that give Employee a longer period of exercise or
greater rights than those set forth in this Agreement, then the terms and
conditions governing exercisability and continuation of the Option after
termination of Employment contained in the Employment Agreement shall supersede
those set forth in this Agreement.
3. EXERCISE OF OPTION. The Option may be exercised by delivering to the
Corporation at the office of the Corporate Secretary (a) a written notice,
signed by the person entitled to exercise the Option, stating the number of
shares such person then elects to purchase hereunder, (b) payment in an amount
equal to the full purchase price of the shares then to be purchased, and (c) in
the event the Option is exercised by any person other than the Employee,
evidence satisfactory to the Corporation that such person has the right to
exercise the Option. If it is required (in the estimation of the Corporation),
the Corporation also may require the payment of any withholding or other
applicable taxes at the time of exercise of the Option. Payment shall be made
(i) in cash, (ii) in previously acquired shares of Common Stock of the
Corporation, valued at their Fair Market Value on the day preceding the exercise
date of the Option, or (iii) in any combination of cash and such shares. Shares
tendered in payment of the purchase price which have been acquired through an
exercise of a stock option shall have been held at least six (6) months prior to
exercise of the Option. Upon the due exercise of the Option, the Corporation
shall issue in the name of the person exercising the Option, and deliver to the
Employee, one or more certificates for the shares in respect of which the Option
shall have been so exercised. The Employee acknowledges that the Employee does
not have any rights as a shareholder in respect of any shares as to which the
Option shall not have been duly exercised and that no rights as a shareholder
shall arise in respect of any such shares until and except to the extent that a
certificate or certificates for such shares shall have been issued.
4. PROHIBITION AGAINST TRANSFER. The Option and rights granted by the
Corporation under this Agreement are not transferable except by will or the laws
of descent and distribution. Without limiting the generality of the foregoing,
the Option may not be assigned, transferred except as aforesaid, pledged or
hypothecated, shall not be assignable by operation of law, and shall not be
subject to execution, attachment or similar process. Any attempted assignment,
transfer, pledge, hypothecation or other disposition of the Option contrary to
the provisions hereof, or the levy of any execution, attachment or similar
process upon the Option, shall be null and void and without effect.
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5. ADJUSTMENTS. In case there shall be a merger, reorganization,
consolidation, recapitalization, stock dividend, a change in corporate structure
such that shares of Common Stock are changed into or become exchangeable for a
larger or smaller number of shares, or an issuance of Common Stock by the
Corporation in exchange for which the Corporation (or its then current
shareholders, on a pro-rata basis) does not receive cash or other property, the
number of shares subject to outstanding Options shall be increased or decreased
in direct proportion to the increase or decrease in the number of shares of
Common Stock by reason of such change in corporate structure. The number of
shares shall always be a whole number, and the purchase price per share of any
outstanding Options shall, in the case of an increase in the number of shares,
be proportionately reduced, and in the case of a decrease in the number of
shares, shall be proportionately increased.
6. EMPLOYMENT BY PARENT, SUBSIDIARY OR SUCCESSOR. For the purpose of this
Agreement, employment by a parent or subsidiary of or a successor to the
Corporation shall be considered employment by the Corporation. "Parent" and
"subsidiary" as used herein shall have the meaning of "parent" and "subsidiary
corporation," respectively, as defined in Section 424 of the Internal Revenue
Code of 1986, as amended, or subsequent comparable statute.
7. COMMITTEE. The Corporation's Board of Directors and the Committee
administering the Plan shall have authority, subject to the express provisions
of the Plan as in effect from time to time, to construe this Agreement and the
Plan, to establish, amend and rescind rules and regulations relating to the
Plan, and to make all other determinations in the judgment of the Committee
necessary or desirable for the administration of the Plan. The Committee may
correct any defect or supply any omission or reconcile any inconsistency in this
Agreement in the manner and to the extent it shall deem expedient to carry the
Plan into effect, and it shall be the sole and final judge of such expediency.
8. INCORPORATION OF PLAN PROVISIONS. This Agreement is made pursuant to the
Plan, the terms and conditions of which are hereby incorporated by reference.
Capitalized terms not otherwise defined herein have the meanings set forth in
the Plan. In the event of a conflict between the terms of this Agreement and the
Plan, the terms of the Plan shall govern.
9. MISCELLANEOUS.
(iii) Words such as "herein", "hereof" and "hereunder" when used
in this Agreement shall refer to this Agreement as a whole unless the
context requires otherwise. (iv) This Agreement embodies the entire
agreement between the parties hereto with respect to the Option.
(iii) This Agreement shall be governed by and construed in
accordance with the laws of the State of Florida.
(iv) This Agreement may be amended or modified only in a written
document executed by both of the parties hereto.
(v) No waiver of any provision of this Agreement shall in any
event be effective unless the same shall be in writing and signed by
the party granting such waiver and then such waiver shall be effective
only in the specific instance and for the specific purpose for which
given.
IN WITNESS WHEREOF, the parties hereto have executed this Stock Option
Agreement in duplicate as of the day and year first above written.
CYBERGUARD CORPORATION EMPLOYEE
By:
----------------------------------- ----------------------------------
Xxxxx X. Xxxxxx, President and
Chief Operating Officer
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CYBERGUARD CORPORATION
NON-STATUTORY STOCK OPTION AGREEMENT
This Stock Option Agreement ("Agreement") is entered into as of the ,
199 , between CyberGuard Corporation (the "Corporation"), a Florida corporation
having its principal office in Ft. Lauderdale, Florida, and ,
("Employee") of the Corporation or one of its subsidiaries.
WHEREAS, the Corporation and the Employee have previously entered into one
or more stock option agreement(s) as more fully described below ("Old Options");
WHEREAS, in consideration of Employee's agreement to fully terminate all
the Old Options, the Corporation hereby agrees to grant to Employee a "New
Option" (as defined below) to completely replace the Old Options.
NOW THEREFORE, the Corporation and Employee hereby agree as follows:
1. NEW OPTION. Under and subject to the provisions of the Corporation's
Employee Stock Option Plan as in effect from time to time ("Plan"), the
Corporation hereby grants to Employee a non-statutory option to purchase an
aggregate of the number of shares of Common Stock of the Corporation as set
forth on Exhibit B attached hereto at the price of U.S. $ per share ("New
Option"), subject to the following conditions:
(a) The New Option shall not be exercisable to any extent until and
unless the Employee shall have remained continuously in the employ of the
Corporation until at least May 6, 1999; provided, however, that if the
Employee's employment is terminated for any of the reasons stated in
subsections 2(a), 2(b), 2(c) or 2(d) of this Agreement, then the
requirement that Employee remain continuously in the employ of the
Corporation until at least May 6, 1999 shall be waived by the Corporation
and the New Options shall become exercisable to the extent and for the time
period stated in the applicable subsections of Section 2. Nothing herein
shall limit or restrict the Corporation's rights to terminate the
Employee's employment.
(b) During the lifetime of the Employee, the New Option shall be
exercisable only by the Employee, and (except when Section 2 is applicable)
only while the Employee continues as an employee of the Corporation.
(c) Notwithstanding any other provision of this Agreement, the New
Option shall expire in accordance with the schedule set forth on Exhibit B
hereof, but in no event later than five years from the date hereof, and
shall not be exercisable thereafter.
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(d) The number of shares of Common Stock with respect to which the New
Option may be exercised from time to time is limited to the percentages of
the aggregate number of shares optioned hereby as set forth in Exhibit B
attached hereto.
(e) By executing this Agreement, Employee acknowledges and agrees that
all Old Options are hereby fully and finally terminated, are void and are
of no further force or effect. The New Option granted to Employee herein
replaces the Old Options in their entirety. As used herein, the term "Old
Option" shall mean all options, rights and option agreements dated on or
before September 3, 1998 between Corporation and Employee under which
Employee has the right to purchase shares of Corporation Common Stock from
the Corporation at a stated exercise price per share (collectively, the
"Old Options"). Without limiting the generality of the foregoing sentence,
attached hereto as Exhibit A is a description of the Old Options.
Notwithstanding the attachment of Exhibit A, it is the intention of the
parties hereto that this Agreement shall terminate all options, rights and
option agreements dated on or before September 3, 1998 between Corporation
and Employee under which Employee has the right to purchase shares of
Corporation Common Stock from the Corporation at a stated exercise price
per share, whether or not such options, warrants or agreements are listed
on Exhibit A.
(f) This Agreement is not intended to terminate employment agreements
(if any) between the Employee and the Corporation that provide generally
for the rights and duties of the Employee and the Corporation with respect
to Employee's employment with the Corporation, but if any such employment
agreements are dated on or before September 3, 1998 and contain provisions
that grant options to Employee to purchase Corporation stock, then the
options granted by such provisions are intended to be Old Options under
this Agreement and are hereby terminated.
2. TERMINATION OF EMPLOYMENT. If any of the events described in subsections
(a), (b), (c), or (d) below occur on or before May 6, 1999, then the New Options
shall become immediately exercisable to the extent that they are otherwise
exercisable in accordance with the vesting schedule set forth in Exhibit B, and
shall remain exercisable for the period of time as stated in the applicable
subsection below. If any of the events described in subsections (a), (b), (c),
or (d) below occur after May 6, 1999, then the New Options, to the extent that
they are then otherwise exercisable in accordance with the vesting schedule set
forth in Exhibit B, shall remain exercisable for the period of time as stated in
the applicable subsection below. If the event described in subsection (e) below
occurs on or before May 6, 1999, then the New Options shall terminate at the
time of termination of employment. If a "Change of Control" (as defined in the
Plan) shall occur and Employee's employment is thereafter terminated, then the
provisions of subsection (f) below shall control.
(a) DEATH. In the event of the death of the Employee, the New Option
shall be (i) exercisable only by the executor or administrator of the
Employee's estate or by the person or persons to whom the Employee's rights
under the New Option shall pass by the Employee's will or the laws of
descent and distribution, (ii) exercisable if and to the extent that the
New Option was exercisable at the date of the Employee's death and (iii)
shall remain exercisable for the shorter of (a) one year following
Employee's death or (b) with respect to each option, the remainder of the
period of exercisability as stated in Exhibit B attached hereto.
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(b) DISABILITY. In the event of termination of Employee's employment
due to disability of the Employee, the New Option shall be exercisable by
the Employee only to the extent that the New Option was exercisable at the
date of such cessation of employment, and no more, and shall remain
exercisable for the shorter of (a) one year following Employee's
termination of employment or (b) with respect to each option, the remainder
of the period of exercisability as stated in Exhibit B attached hereto.
(c) RETIREMENT. In the event of Retirement of the Employee, the New
Option shall be exercisable by the Employee only to the extent that the New
Option was exercisable at the date of such cessation of employment, and no
more, and shall remain exercisable for the shorter of (a) one year
following Employee's termination of employment or (b) with respect to each
option, the remainder of the period of exercisability as stated in Exhibit
B attached hereto. The term "Retirement" is specially defined in the Plan;
generally, a termination in service from the Corporation will be covered by
provisions regarding terminations for reasons other than death, disability,
or Retirement, and not this paragraph.
(d) TERMINATION OF EMPLOYMENT BY THE CORPORATION. In the event of
termination of Employee's employment by the Corporation, the New Option
shall be exercisable only to the extent that it was exercisable at the date
of such cessation of employment, and no more, and shall remain exercisable
for the shorter of (a) three months following Employee's termination of
employment or (b) with respect to each option, the remainder of the period
of exercisability as stated in Exhibit B attached hereto.
(e) TERMINATION OF EMPLOYMENT BY THE EMPLOYEE. In the event of
termination of employment by the Employee for reasons other than death,
disability or Retirement, the New Option shall be exercisable only to the
extent that it was exercisable at the date of such cessation of employment,
and no more, and shall remain exercisable for the shorter of (a) three
months following Employee's termination of employment or (b) with respect
to each option, the remainder of the period of exercisability as stated in
Exhibit B attached hereto.
(f) CHANGE OF CONTROL. If a "Change of Control" (as defined in the
Plan) shall occur and Employee's employment is thereafter terminated by the
Corporation, then the New Options shall become 100% immediately exercisable
in full (to the extent that they otherwise have not expired) and shall
remain exercisable for the shorter of (a) one year following Employee's
termination of employment or (b) with respect to each option, the remainder
of the period of exercisability as stated in Exhibit B attached hereto.
Notwithstanding the foregoing provisions of this section 2, in the event that:
(x) the Employee has entered into an Employment Agreement with the Corporation
(the "Employment Agreement"); and (y) if Employee's Employment Agreement is
terminated under circumstances that give Employee a longer period of exercise or
greater rights than those set forth in this Agreement, then the terms and
conditions governing exercisability and continuation of the New Option after
termination of Employment contained in the Employment Agreement shall supersede
those set forth in this Agreement.
3. EXERCISE OF NEW OPTION. The New Option may be exercised by delivering to
the Corporation at the office of the Corporate Secretary (i) a written notice,
signed by the person entitled to
11
exercise the New Option, stating the number of shares such person then elects to
purchase hereunder, (ii) payment in an amount equal to the full purchase price
of the shares then to be purchased, and (iii) in the event the New Option is
exercised by any person other than the Employee, evidence satisfactory to the
Corporation that such person has the right to exercise the New Option. If it is
required (in the estimation of the Corporation), the Corporation also may
require the payment of any withholding or other applicable taxes at the time of
exercise of the New Option. Payment shall be made (a) in cash, (b) in previously
acquired shares of Common Stock of the Corporation, valued at their Fair Market
Value on the day preceding the exercise date of the New Option, or (c) in any
combination of cash and such shares. Shares tendered in payment of the purchase
price which have been acquired through an exercise of a stock option shall have
been held at least six (6) months prior to exercise of the New Option. Upon the
due exercise of the New Option, the Corporation shall issue in the name of the
person exercising the New Option, and deliver to the Employee, one or more
certificates for the shares in respect of which the New Option shall have been
so exercised. The Employee acknowledges that the Employee does not have any
rights as a shareholder in respect of any shares as to which the New Option
shall not have been duly exercised and that no rights as a shareholder shall
arise in respect of any such shares until and except to the extent that a
certificate or certificates for such shares shall have been issued.
4. PROHIBITION AGAINST TRANSFER. The New Option and rights granted by the
Corporation under this Agreement are not transferable except by will or the laws
of descent and distribution. Without limiting the generality of the foregoing,
the New Option may not be assigned, transferred except as aforesaid, pledged or
hypothecated, shall not be assignable by operation of law, and shall not be
subject to execution, attachment or similar process. Any attempted assignment,
transfer, pledge, hypothecation or other disposition of the New Option contrary
to the provisions hereof, or the levy of any execution, attachment or similar
process upon the New Option, shall be null and void and without effect.
5. ADJUSTMENTS. In case there shall be a merger, reorganization,
consolidation, recapitalization, stock dividend, a change in corporate structure
such that shares of Common Stock are changed into or become exchangeable for a
larger or smaller number of shares, or an issuance of Common Stock by the
Corporation in exchange for which the Corporation (or its current shareholders,
on a pro-rata basis) does not receive cash or other property, the number of
shares subject to outstanding New Options shall be increased or decreased in
direct proportion to the increase or decrease in the number of shares of Common
Stock by reason of such change. The number of shares shall always be a whole
number, and the purchase price per share of any outstanding New Options shall,
in the case of an increase in the number of shares, be proportionately reduced,
and in the case of a decrease in the number of shares, shall be proportionately
increased.
6. EMPLOYMENT BY PARENT, SUBSIDIARY OR SUCCESSOR. For the purpose of this
Agreement, employment by a parent or subsidiary of or a successor to the
Corporation shall be considered employment by the Corporation. "Parent" and
"subsidiary" as used herein shall have the meaning of "parent" and "subsidiary
corporation," respectively, as defined in Section 424 of the Internal Revenue
Code of 1986, as amended, or subsequent comparable statute.
7. COMMITTEE. The Corporation's Board of Directors and the Committee
administering the Plan shall have authority, subject to the express provisions
of the Plan as in effect from time to time, to construe this Agreement and the
Plan, to establish, amend and rescind rules and regulations relating to the
Plan, and to make all other determinations in the judgment of the Committee
necessary or desirable for the administration of the Plan. The Committee may
correct any defect or supply any omission or reconcile any inconsistency in this
Agreement in the manner and to the extent it shall deem expedient to carry the
Plan into
12
effect, and it shall be the sole and final judge of such expediency.
8. INCORPORATION OF PLAN PROVISIONS. This Agreement is made pursuant to the
Plan, the terms and conditions of which are hereby incorporated by reference.
Capitalized terms not otherwise defined herein have the meanings set forth in
the Plan. In the event of a conflict between the terms of this Agreement and the
Plan, the terms of the Plan shall govern.
9. MISCELLANEOUS.
(i) Words such as "herein", "hereof" and "hereunder" when used in
this Agreement shall refer to this Agreement as a whole unless the
context requires otherwise.
(ii) This Agreement embodies the entire agreement and
understanding of the parties with respect to the Old Options and the
New Options.
(iii) This Agreement shall be governed by and construed in
accordance with the laws of the State of Florida.
(iv) This Agreement may be amended or modified only in a written
document executed by both of the parties hereto.
(v) No waiver of any provision of this Agreement shall in any
event be effective unless the same shall be in writing and signed by
the party granting such waiver and then such waiver shall be effective
only in the specific instance and for the specific purpose for which
given.
IN WITNESS WHEREOF, the parties hereto have executed this Stock Option
Agreement in duplicate as of the day and year first above written.
CYBERGUARD CORPORATION EMPLOYEE
By:
----------------------------------- ----------------------------------
Xxxxx X. Xxxxxx, President and
Chief Operating Officer
DIRECTORS NON-STATUTORY STOCK OPTION AGREEMENT
UNDER THE
CYBERGUARD CORPORATION STOCK INCENTIVE PLAN
This Stock Option Agreement ("Agreement") is entered into as of the day
of , 199 , between CyberGuard Corporation (the "Corporation"), a
Florida corporation having its principal office in Ft. Lauderdale, Florida, and
, (the "Director"), a director of the Corporation.
1. THE OPTION. Under and subject to the provisions of the Corporation's
Stock Incentive Plan as in effect on the date hereof (the "Plan"), the
Corporation hereby grants to the Director a Non-Statutory Stock Option
("Option"), to acquire shares of the Corporation's Common Stock at the
price of $ per share, that was the fair market value of the Common Stock
on the date of grant, as follows:
(a) The Option shall be exercisable immediately and shall remain
exercisable for ten years from the date hereof, except in the event of the
Director's death, in which case
13
it shall remain exercisable as described in the Plan.
(b) During the lifetime of the Director, the Option shall be
exercisable only by the Director; after the Director's death, the Option
shall be exercisable as described in the Plan.
(c) Notwithstanding any other provision of this Agreement, the Option
shall expire no later than ten years from the date of this Agreement, and
shall not be exercisable thereafter.
(d) Upon a Change in Control, any outstanding Option shall immediately
become exercisable.
2. EXERCISE OF OPTION. The Option may be exercised by delivering to the
Corporation at the office of the Corporate Secretary (i) a written notice,
signed by the person entitled to exercise the Option, stating the number of
shares such person then elects to purchase hereunder, (ii) payment in an amount
equal to the full purchase price of the shares then to be purchased, and (iii)
in the event the Option is exercised by any person other than the Director,
evidence satisfactory to the Corporation that such person has the right to
exercise the Option. Payment shall be made (a) in cash, (b) in previously
acquired shares of Common Stock of the Corporation, valued at their Fair Market
Value on the day preceding the exercise date of the Option, or (c) in any
combination of cash and such shares. Shares tendered in payment of the purchase
price which have been acquired through an exercise of a stock option shall have
been held at least six (6) months prior to exercise of the Option. Upon the due
exercise of the Option, the Corporation shall issue in the name of the person
exercising the Option, and deliver to the Director, one or more certificates for
the shares in respect of which the Option shall have been so exercised. The
Director acknowledges that the Director does not have any rights as a
shareholder in respect of any shares as to which the Option shall not have been
duly exercised and that no rights as a shareholder shall arise in respect of any
such shares until and except to the extent that a certificate or certificates
for such shares shall have been issued.
3. PROHIBITION AGAINST TRANSFER. The Option and rights granted by the
Corporation under this Agreement are not transferable except by will or the laws
of descent and distribution. Without limiting the generality of the foregoing,
the Option may not be assigned, transferred except as aforesaid, pledged or
hypothecated, shall not be assignable by operation of law, and shall not be
subject to execution, attachment or similar process. Any attempted assignment,
transfer, pledge, hypothecation or other disposition of the Option contrary to
the provisions hereof, or the levy of any execution, attachment or similar
process upon the Option, shall be null and void and without effect.
4. ADJUSTMENTS. In case there shall be a merger, reorganization,
consolidation, recapitalization, stock dividend or other change in corporate
structure such that shares of Common Stock are changed into or become
exchangeable for a larger or smaller number of shares, the number of shares
subject to outstanding Options shall be increased or decreased in direct
proportion to the increase or decrease in the number of shares of Common Stock
by reason of such change in corporate structure. The number of shares shall
always be a whole number, and the purchase price per share of any outstanding
Options shall, in the case of an increase in the number of shares, be
proportionately reduced, and in the case of a decrease in the number of shares,
shall be proportionately increased.
5. COMMITTEE. The Committee administering the Plan shall have authority,
subject to the express provisions of the Plan as in effect from time to time, to
construe this Agreement and the Plan, to
14
establish, amend and rescind rules and regulations relating to the Plan, and to
make all other determinations in the judgment of the Committee necessary or
desirable for the administration of the Plan. The Committee may correct any
defect or supply any omission or reconcile any inconsistency in this Agreement
in the manner and to the extent it shall deem expedient to carry the Plan into
effect, and it shall be the sole and final judge of such expediency.
6. INCORPORATION OF PLAN PROVISIONS. This Agreement is made pursuant to the
Plan, the terms and conditions of which are hereby incorporated by reference.
Capitalized terms not otherwise defined herein have the meanings set forth in
the Plan. In the event of a conflict between the terms of this Agreement and the
Plan, the terms of the Plan shall govern.
7. MISCELLANEOUS. Words such as "herein", "hereof" and "hereunder" when
used in this Agreement shall refer to this Agreement as a whole unless the
context otherwise requires. This Agreement, together with any written Employment
Agreement between Employee and Corporation, constitute the entire agreement and
supersede all prior agreements and understandings, both oral and written,
between the parties hereto with respect to the subject matter hereof, and,
except as expressly provided herein and therein, are not intended to confer upon
any person other than the parties hereto any rights or remedies. This Agreement
shall be governed by and construed in accordance with the laws of the State of
Florida. This Agreement may be amended or modified only in a written document
executed by both of the parties hereto.
IN WITNESS WHEREOF, the parties hereto have executed this Stock Option
Agreement in duplicate as of the day and year first above written.
CYBERGUARD CORPORATION
By:
--------------------------------
-----------------------------------
Director
