Exhibit 10.40
[CEO]
COLOR KINETICS INCORPORATED
Non-Statutory Stock Option Agreement
Color Kinetics Incorporated, a
Delaware corporation (the “Company”), hereby grants as
of the date below (the “Grant Date”) to the person
named below (the “Employee”) and the Employee hereby
accepts, an option to purchase the number of shares (the
“Option Shares”) listed below of the Company’s
Common Stock $.001 par value per share (“Common
Stock”), at the price per share and with a vesting start date
(the “Vesting Start Date”) listed below, such option to
be subject to the terms and conditions specified herein and in the
attached Exhibit A .
Employee Name:
Grant Date:
Total Number of Shares:
Exercise Price Per Share:
Expiration Date of Option:
Vesting Schedule : This Option shall become
exercisable for 25% of the Total Number of Option Shares on
, and for an additional 6.25% of the Total Number of Option Shares
at the end of every three month period thereafter.
Acceleration of Vesting Upon
Change-in Control: Upon a Change in Control, then, provided
you sign the Release Agreement previously provided to you as
Exhibit A to your agreement dated May 1, 2007, the
vesting of your Option Shares shall be fully accelerated on the
date of such Change in Control (after giving effect to any
applicable revocation periods in the Release Agreement). For
purposes of clarity, in the case of a Change in Control in which
the consideration received by holders of the Company’s common
stock consists entirely of cash, options vesting at or post the
Change in Control are cash settlement instruments, payable at the
difference between the Change in Control purchase price and the
exercise price.
For purposes of this Agreement, a
“Change of Control” with respect to a party means
(a) the direct or indirect acquisition, whether in one or a
series of transactions, by any person or related person
constituting a group, of (i) beneficial ownership of issued
and outstanding shares of stock of such party, the result of which
is that such person or such group possesses in excess of fifty
percent (50%) of the combined voting power of all then-issued and
outstanding stock of such party, or (ii) the power to elect,
appoint, or cause the election or appointment of at least a
majority of the members of the board of directors (or equivalent
governing body) of such party; (b) a merger or consolidation of a
party with a person, or a reorganization or recapitalization of a
party, provided that the result of such transaction, whether in one
or a series of related transactions, is that the holders of the
outstanding voting stock of such party immediately prior to such
consummation do not possess in excess of fifty percent (50%) of the
combined voting power of all of the then-issued and outstanding
stock of such party or surviving person of such party, whether
directly or indirectly, immediately after the consummation of such
transaction; or (c) the sale or disposition, whether directly
or indirectly, in one or a series of related transactions, of
substantially all of the assets of a party. For purposes of the
preceding sentence, the terms “person,”
“group” and “beneficial ownership” shall
have the meanings given to such terms under the Securities Exchange
Act of 1934, as amended.
Lock-Up Agreement; Other Terms and Conditions: All
shares purchased upon exercise of this Option are subject to the
lock-up agreement set forth in Section 9 of the attached Terms
and Conditions and to the other terms of the Option and Plan.
IN WITNESS WHEREOF, the Company and
the Employee have caused this instrument to be executed as of the
Grant Date set forth above.
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COLOR KINETICS
INCORPORATED |
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(Employee Signature
and Date)
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10 Milk Street,
Suite 1100 |
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Boston, MA 02108 |
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(Street
Address)
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By: |
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David K. Johnson |
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(City/State/Zip
Code)
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Sr. Vice President and CFO |
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EXHIBIT A
Non-Statutory Stock Option Agreement
Terms and Conditions
Color Kinetics Incorporated 2004
Stock Incentive Plan
This Option is granted pursuant to
and governed by the Company’s 2004 Stock Incentive Plan (the
“Plan”) and, unless the context otherwise requires,
terms used herein shall have the same meaning as in the Plan.
Determinations made in connection with this Option pursuant to the
Plan shall be governed by the Plan as it exists on the Grant
Date.
Section 1. Grant of
Option. Subject to the terms and conditions hereinafter set
forth, the Holder is hereby given the right and option to purchase
from the Company shares of the Company’s Common Stock, $.001
par value per share (the “Common Stock”). The
Non-Statutory Stock Option Agreement to which these Terms and
Conditions are attached sets forth (i) the expiration date of
the Option, (ii) its exercise price per share, (iii) the
maximum number of shares that the Holder may purchase upon exercise
hereof, (iv) the vesting schedule and (v) certain other
terms and conditions applicable to this Option and incorporated
herein. The right to purchase shares hereunder shall be
cumulative.
This Option is and shall be subject
in every respect to the provisions of the Company’s 2004
Stock Incentive Plan, as amended from time to time, which is
incorporated herein by reference and made a part hereof. The Holder
hereby accepts this Option subject to all the terms and provisions
of the Plan and agrees that (i) in the event of any conflict
between the terms hereof and those of the Plan, the latter shall
prevail, and (ii) all decisions under and interpretations of
the Plan by the Board of Directors of the Company (the
“Board”) or the Committee shall be final, binding and
conclusive upon the Holder and his heirs and legal representatives.
References herein to the “Committee” shall mean the
Committee as defined in the Plan.
Section 2.
Exercise of Option. This Option may be exercised only to the
extent such Option has vested pursuant to the terms of
Section 1. Purchase of any shares hereunder shall be made by
delivery to the Company of a written notice of exercise (the
“Notice”) setting forth the number of shares with
respect to which the Option is being exercised and the address to
which the certificate for such shares is to be mailed, accompanied
by:
(i) cash, certified or bank check or
postal money order payable to the order of the Company for an
amount equal to the Option price of such shares;
(ii) with the consent of the
Committee, shares of Common Stock of the Company which
(a) either have been purchased by the Holder on the open
market, or (b) have been beneficially owned by the Holder for
a period of at least six months and are not then subject to
restriction under any Company plan (“mature shares”);
such surrendered shares shall have a fair market value equal to or
less than the Option price of such shares and shall be accompanied
by cash or a certified or bank check or postal money order in an
amount equal to the difference, if any, between the Option price of
such shares and the fair market value of such shares;
(iii) with the consent of the
Committee, a personal recourse note issued by the Holder to the
Company in a principal amount equal to such aggregate exercise
price and with such other terms, including interest rate and
maturity, as the Company may determine in its discretion, provided
that the interest rate borne by such note shall not be less than
the lowest applicable federal rate, as defined in Section 1274(d)
of the Internal Revenue Code of 1986, as amended.
(iv) with the consent of the
Committee, if the class of Common Stock is registered under the
Securities Exchange Act of 1934 at that time, subject to rules as
may be established by the Committee, irrevocable instructions to a
broker to promptly deliver to the Company cash or a check payable
and acceptable to the Company for the purchase price;
(v) with the consent of the
Committee, instructions to reduce the number of shares otherwise
issuable to the Holder upon the exercise of the Option by a number
of shares of Common Stock having a fair market equal to the
aggregate exercise price; provided, however, that the Holder
otherwise owns an equal number of mature shares; or
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(vi) with the consent of the
Committee, a combination of (i), (ii), (iii), (iv) and/or
(v).
For the purpose of the foregoing, the
fair market value per share of the Common Stock so delivered to the
Company shall be the closing price per share on the date of
delivery as reported by such registered national securities
exchange on which the Common Stock is listed, or, if the Common
Stock is not listed on such an exchange, as quoted on NASDAQ;
provided, that, if there is no trading on such date, the fair
market value shall be deemed to be the closing price per share on
the last preceding date on which the Common Stock was traded. If
the Common Stock is not listed on any national registered
securities exchange or quoted on NASDAQ, the fair market value of
the Common Stock shall be determined in good faith by the
Committee.
Section 3. Conditions and
Limitations. The Company, in its discretion, may file a
registration statement on Form S-8 under the Securities Act of 1933
to register shares of Common Stock reserved for issuance under the
Plan. At any time at which such a registration statement is not in
effect, it shall be an additional condition precedent to any
exercise of this Option that the Holder shall deliver to the
Company a customary “investment letter” satisfactory to
the Company and its counsel in which, among other things, the
Holder shall
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