EXHIBIT 10.4
SOAPSTONE NETWORKS
INC.
NON-EMPLOYEE DIRECTOR AUTOMATIC
GRANT
NON-QUALIFIED STOCK OPTION
AGREEMENT
Soapstone Networks Inc., a Delaware
corporation (the “ Company ”), may grant to any
non-employee director of the Company (the “ Optionee
”), an option to purchase certain shares (the “
Option Shares ”) of its Common Stock, $.0001 par value
per share (“ Common Stock ”), at a certain price
per share.
Such grants shall be made in
accordance with the terms and conditions of this Non-Qualified
Stock Option Agreement (the “ Agreement ”), the
Company’s 2008 Global Stock Plan, as amended from time to
time (the “ Plan ”), and the Notice of Grant of
Stock Option (the “ Certificate ”) made
available to the Optionee at the time of grant.
1. Grant Under 2008 Global
Stock Plan . This
option is granted pursuant to and is governed by 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 this date. Any inconsistency between this Agreement
and the Plan shall be governed by the Plan.
2. Grant as Non-Qualified
Option; Other Options . This option shall be treated for federal income
tax purposes as a Non-Qualified Option (the “ NQO
”) (rather than an incentive stock option). This option is in
addition to any other options heretofore or hereafter granted to
the Optionee by the Company, but a duplicate original of this
instrument shall not effect the grant of another option.
3. Vesting of Option
. Options granted under
this Plan shall vest in the Optionee and thus become exercisable,
in accordance with the vesting schedule and terms set forth on the
Certificate, provided that the Optionee has continuously served as
a member of the Board through such vesting date, as well as the
terms and conditions of the Plan applicable to automatic grants to
non-employee directors.
The number of shares as to which
options may be exercised shall be cumulative, so that once the
option shall become exercisable as to any shares it shall continue
to be exercisable as to said shares before the date which is seven
(7) years from the date the option is granted or until
expiration or termination of the option as otherwise provided in
the Plan. Notwithstanding the foregoing, in accordance with and
subject to the provisions of the Plan, the Committee may, in its
discretion, accelerate the date that any installment of this option
becomes exercisable.
4. Termination of Option
Rights .
(a) In the event an Optionee ceases
to be a member of the Board for any reason other than death or
permanent disability, any then unexercised portion of options
granted to such Optionee shall, to the extent not then vested,
immediately terminate and become void; any portion of an option
which is then vested but has not been exercised at the time the
Optionee so ceases to be a member of the Board may be exercised, to
the extent it is then vested, by the Optionee within 180
days of the date the Optionee ceased to be a member
of the Board; and all options shall terminate after such
180 days have expired.
(b) In the event that an Optionee
ceases to be a member of the Board by reason of his or her death or
permanent disability, any option granted to such Optionee shall be
immediately and automatically accelerated and become fully vested
and all unexercised options shall be exercisable by the Optionee
(or by the Optionee’s personal representative, conservator,
guardian or designated beneficiary) until the scheduled expiration
date of the option.
(c) No portion of an option may be
exercised if the Optionee is removed from the Board of Directors
for any one of the following reasons: (i) disloyalty, gross
negligence, dishonesty or breach of fiduciary duty to the Company;
or (ii) the commission of an act of embezzlement, fraud or
deliberate disregard of the rules or policies of the Company which
results in loss, damage or injury to the Company, whether directly
or indirectly; or (iii) the unauthorized disclosure of any
trade secret or confidential information of the Company; or
(iv) the commission of an act which constitutes unfair
competition with the Company or which induces any customer of the
Company to break a contract with the Company; or (v) the
conduct of any activity on behalf of any organization or entity
which is a competitor of the Company (unless such conduct is
approved by a majority of the members of the Board of
Directors).
5. Partial Exercise
. This option may be
exercised in part at any time and from time to time within the
above limits, except that this option may not be exercised for a
fraction of a share, unless such exercise is with respect to the
final installment of stock subject to this option and cash in lieu
of a fractional share must be paid, to permit the Optionee to
exercise completely such final installment. Any fractional share
with respect to which an installment of this option cannot be
exercised because of the limitation contained in the preceding
sentence shall rem
