Exhibit
10.5
CHINA TRANSINFO TECHNOLOGY
CORP.
NOTICE OF STOCK OPTION
GRANT
|
Name:
Brandon Ho-Ping Lin
|
Address:
|
|
18F Tower
C
|
|
|
|
|
Central
International Trade Center
|
|
|
|
|
6A
Jianguomenwai Avenue
|
|
|
|
|
Chaoyang
District
|
|
|
|
|
Beijing, China
100022
|
You have been
granted an option (the “ Option ”) to
purchase common stock (“ Shares ”) of
China TransInfo Technology Corp (the “
Company ”), subject to the terms and
conditions of the attached Stock Option Agreement, as
follows:
|
|
|
|
|
|
Vesting
Commencement Date:
|
|
|
|
|
Exercise Price
per Share:
|
|
|
|
|
Total Number of
Shares Granted:
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-Qualified
Stock Option
|
|
|
|
|
|
|
The Option
vests in equal installments on a quarterly basis over a three-year
period. Notwithstanding the foregoing, the Option will become fully
vested and exercisable upon a Change in Control.
To the extent
vested, this Option will be exercisable for three (3) months after
the Termination Date, unless (i) termination is due to
Optionee’s death or Disability, in which case this Option
will be exercisable for twelve (12) months after the Termination
Date or (ii) the Optionee is Terminated for Cause, in which case
this Option will terminate on the Termination Date. In no event may
this Option be exercised later than the Expiration Date provided
above.
CHINA TRANSINFO TECHNOLOGY
CORP.
STOCK OPTION
AGREEMENT
This
STOCK OPTION AGREEMENT (“
Agreement ”), dated as of the 28
th day of September, 2008 is made by and between China
TransInfo Technology Corp., a Nevada corporation (the “
Company ”), and Brandon Ho-Ping Lin (the
“ Optionee ”).
BACKGROUND
The Company,
acting through its Board of Directors (the “
Board ”), approved the grant to the
Optionee, effective as of the date set forth above, of a stock
option (“ Option ”) to purchase shares
of the common stock, par value $.001 per share (the “
Shares ”), of the Company at the price (the
“ Exercise Price ”) set forth in the
attached Notice of Stock Option Grant (which is expressly
incorporated herein and made a part hereof, the “
Notice of Grant ”), upon the terms and
conditions hereinafter set forth.
NOW,
THEREFORE , in
consideration of the mutual promises and undertakings hereinafter
set forth, the parties hereto agree as follows:
1.
Grant of Option
. On behalf of the Company, the
Board hereby grants to the Optionee an Option to purchase, subject
to the terms and conditions of this Agreement, that number of
Shares of the Company set forth in the Notice of Grant (the “
Optioned Shares ”), at an exercise price per
share equal to the Exercise Price set forth in the Notice of Grant,
subject to the terms and conditions of this Agreement. The Option
is intended to be a Non-Qualified Stock Option, meaning that it is
not qualified as an “Incentive Stock Option” as
described in Section 422 of the Internal Revenue Code of 1986
(“Code”), as amended.
2.
Term . The term of the Option
commences on the date of this Agreement and expires on the
Expiration Date set forth in the Notice of Grant unless otherwise
terminated in accordance with the terms of the Notice of Grant or
this Agreement.
3.
Time of Exercise
. Except as
otherwise provided in this section or unless accelerated in the
discretion of the Board, the Option will become exercisable during
its term in accordance with the Vesting Schedule set forth in the
Notice of Grant. Shares as to which the Option becomes exercisable
may be purchased at any time prior to the expiration or termination
of the Option.
(a) This Option will become fully vested and
exercisable upon a Change in Control. Prior to the closing of a
transaction that would result in a Change in Control, the Company
will notify the Optionee in writing or electronically that the
Option will be exercisable (subject, however, to the requirement
that the Change in Control actually occur) for a period of time
determined by the Company in its sole discretion, and the Option
will terminate upon the expiration of such period for no
consideration, unless otherwise determined by the
Company.
4.
Termination of Option
.
(a) If the Optionee is Terminated for any reason
except death or Disability, then the Optionee may exercise the
Option (i) only to the extent that the Option would have been
exercisable on the Termination Date and (ii) no later than three
months after the Termination Date, but in any event, no later than
the Expiration Date.
(b) If the Optionee is Terminated because of the
Optionee’s death or Disability (or the Optionee dies within
three months after a Termination other than for Cause or because of
Optionee’s Disability), then the Option (i) may be exercised
only to the extent that such Option would have been exercisable by
the Optionee on the Termination Date and (ii) must be exercised by
the Optionee (or the Optionee’s legal representative or
authorized assignee) no later than twelve months after the
Termination Date, but in any event no later than the Expiration
Date.
(c) Notwithstanding the provisions in paragraphs
4(b) and 4(c), if the Optionee is Terminated for Cause, neither the
Optionee, the Optionee’s estate nor such other person who may
then hold the Option will be entitled to exercise the Option
whatsoever, whether or not, after the Termination Date, the
Optionee may receive payment from the Company or any Parent,
Subsidiary or Affiliate of the Company for vacation pay, for
services rendered prior to the Termination Date, for services
rendered for the day on which Termination occurs, for salary in
lieu of notice, for severance or for any other benefits;
provided, however, that the Board will give the Optionee
an opportunity to present to the Board evidence on the
Optionees’s behalf that the provisions of this paragraph 4(d)
should not apply and, in the alternative, paragraph 4(b) or 4(c)
will apply. For the purpose of this paragraph 4(d), Termination
will occur on the date when the Company dispatches notice or advice
to the Optionee that the Optionee is Terminated.
5.
Method of Exercise
. This Option is exercisable by
delivery of an exercise notice in the form attached as Exhibit A
(the “Exercise Notice”) or in a manner and pursuant to
procedures as the Board may determine, which will state the
election to exercise the Option, the number of Shares for which the
Option is being exercised, and other representations and agreements
as may be required by the Company. The Exercise Notice will be
accompanied by payment of the aggregate Exercise Price as to all
Shares being acquired, together with any applicable tax
withholding. This Option will be deemed to be exercised upon
receipt by the Company of a fully executed Exercise Notice
accompanied by the aggregate Exercise Price, together with any
applicable tax withholding.
6.
Method of Payment
.
Payment of the aggregate Exercise
Price may be by any of the following, or a combination thereof, at
the election of the Optionee:
(c) to the extent not prohibited by Section 402 of
the Sarbanes-Oxley Act of 2002, a promissory note;
(d) to the extent not prohibited by Section 402 of
the Sarbanes-Oxley Act of 2002, surrender of other Shares which
have a Fair Market Value on the date of surrender equal to the
aggregate Exercise Price of the Shares being acquired;
(e) by asking the Company to withhold Shares from
the total Shares to be delivered upon exercise equal to the number
of Shares having a value equal to the aggregate Exercise Price of
the Shares being acquired;
(f) in accordance with any broker-assisted cashless
exercise procedures approved by the Company and as in effect from
time to time;
(g) any combination of the foregoing methods of
payment; or
(h) other consideration and method of payment for
the issuance of Shares to the extent permitted by applicable
laws.
(a) Withholding . Optionee agrees to arrange for the
satisfaction of all federal, state, local and foreign income and
employment tax withholding requirements applicable to the Option
exercise. Optionee acknowledges and agrees that the Company may
refuse to honor the exercise and refuse to deliver the Shares if
withholding amounts are not delivered at the time of
exercise.
(b) Code Section 409A . Under Code Section 409A, an Option that vests
after December 31, 2004 that was granted with a per Share exercise
price that is determined by the Internal Revenue Service (the
“IRS”) to be less than the Fair Market Value of a Share
on the date of grant (a “discount option”) may be
considered “deferred compensation.” An Option that is a
discount option may result in (i) income recognition by the
Optionee prior to the exercise of the Option, (ii) an additional
twenty percent (20%) tax, and (iii) potential penalty and interest
charges. Optionee acknowledges that the Company cannot and has not
guaranteed that the IRS will agree that the per Share exercise
price of this Option equals or exceeds the fair market value of a
Share on the date of grant in a later examination. Optionee agrees
that if the IRS determines that the Option was granted with a per
Share exercise price that was less than the Fair Market Value of a
Share on the date of grant, Optionee shall be solely responsible
for Optionee’s costs related to such a
determination.
8.
Legal Compliance. Optionee may
not exercise the Option unless the exercise of the Option and the issuance of the
Optioned Shares comply with applicable law. The Company will be
relieved of any liability with respect to any delayed issuance of
shares or its failure to issue shares if such delay or failure is
necessary to comply with applicable laws.
9.
Adjustments Upon Changes in
Capitalization .
In the event that any dividend or other
distribution (whether in the form of cash, Shares, other
securities, or other property), recapitalization, stock split,
reverse stock split, reorganization, merger, consolidation,
split-up, spin-off, combination, repurchase, or exchange of Shares
or other securities of the Company, or other change in the
corporate structure of the Company affecting the Shares occurs, the
Board, in order to prevent diminution or enlargement of the
benefits or potential benefits intended to be made available under
this Option, will equitably adjust the number, class, and Exercise
Price of Shares covered by this Option to prevent enlargement or
diminution of the value of this Option. Any such adjustment shall
be done in a manner consistent with Code Section 409A and Treasury
Regulations section 1.409A-1 et seq.
10.
Investment Representation and
Legend of Certificates .
(a) The Optionee acknowledges and agrees that, for
any period in which a registration statement, with respect to the
Option and/or Shares under the Securities Act of 1933, as amended
(the “Securities Act”), is not effective, the Optionee
will hold the Option and will purchase and/or own the Optioned
Shares for investment and not for resale or distribution. The
Company will have the right to place upon the fa