Exhibit 4.03
ADUROMED INDUSTRIES,
INC.
STOCK OPTION
AGREEMENT
WITH KEVIN
DUNPHY
This
Non-Statutory Option Agreement (the "Agreement") is made and
entered into as of August 4, 2008 by and among ADUROMED INDUSTRIES,
INC., a Delaware Corporation with a principal of business at 3
Trowbridge Drive, Bethel, Connecticut 06801, of the one part
(hereinafter referred to as “AII” or the
“Corporation”), and Kevin Dunphy,
of the other part (the
"Optionee").
RECITALS
WHEREAS, by
action unanimously taken by the Board of Directors of the
Corporation on July 31, 2008, the Board approved the 2008
Non-Statutory Stock Option Plan (“Plan”) of the
Corporation and authorized the Corporation to provide for the
granting of option rights under the Plan to employees, consultants
and non-employee directors of the Corporation and the
Corporation’s wholly-owned subsidiary, Aduromed Corporation
(“Aduromed”), to purchase shares of the
Corporation’s common stock, par value $0.0001 per share
(“Common Stock”) in connection with the transactions
contemplated by that certain Master Restructuring Agreement, dated
as of July 10, 2008 by and among the Corporation, Aduromed and the
other signatories listed on the signature pages thereto (the
“MRA”); and
WHEREAS, in
order to facilitate the purpose of the MRA, the Corporation wishes
to grant to Optionee the right and option to purchase 5,000,000
shares of Common Stock under the Plan;
NOW ,
THEREFORE, the parties hereto hereby agree as follows:
1. Grant of Option. The Corporation
hereby grants to Optionee and to his permitted designees and
assignees, the right and option (“Option”) to purchase
a total of 5,000,000 shares of Common Stock (the “Optioned
Shares”). It is understood and acknowledged that this Option
is designated as a non-statutory stock option that will not qualify
as an incentive stock option under Section 422 of the Internal
Revenue Code (the “Code”).
2. Option Price. The price to be paid for
the Optioned Shares to be issued upon exercise of this Option or
any part thereof shall be $0.025 per share (the "Exercise
Price").
3. Rights to Exercise.
The rights to exercise this Option shall vest
with respect to 1,666,666 shares of Common Stock immediately, with
respect to an additional 1,666,666 shares of Common Stock on August
4, 2009, and with respect to the remaining 1,666,668 shares of
Common Stock on August 4, 2010.
4. Securities Law Requirements. To the
extent this Option shall have vested as provided in Section 3
above, it may be exercised in whole or in part at any time, subject
to an opinion of legal counsel for the Corporation (which shall not
be unreasonably withheld by the Corporation) that, at the time of
such exercise, the issuance of the Optioned Shares is in compliance
with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations promulgated there under (the "Securities
Act").
5. Term of the Options. The Option shall
remain exercisable as to Optioned Shares for five (5) years from
the date of vesting of such Optioned Shares.
If the Optionee
is terminated as an employee without cause (as defined in any
employment agreement with the Corporation applicable to Optionee)
then all of Optionee's unvested Options shall immediately vest and
become exercisable and the term of any such Options shall be
extended to the fifth anniversary of Optionee's employment
termination date.
Should the
Optionee’s service be terminated for cause (as defined in any
employment agreement with the Corporation applicable to Optionee),
then in any such event this Option shall terminate immediately and
with respect to all unvested shares of Common Stock.
In the event
Optionee is unable to continue as an employee as a result of his
total and permanent disability (as defined in Section 22(e)(3) of
the Code), all of Optionee's unvested Options shall immediately
vest and become exercisable and the term of any such Options shall
be extended to the fifth anniversary of Optionee's employment
termination date.
During the term
of this Option if the Optionee was at the time of his death an
employee, all of the Optionee's unvested Options shall immediately
vest and become exercisable and the term of any such Options shall
be extended to the fifth anniversary of the Optionee's date of
death and the Option may be exercised by the Optionee’s
estate or by a person who acquired the right to exercise the Option
by bequest or inheritance.
If during the
term of this Agreement and while the Optionee remains an employee
of the Corporation, the Corporation shall be subject to a Change in
Control, then in such case all of the Optionee's unvested Options
shall immediately vest and become exercisable and the term of any
such Options shall be extended to the fifth anniversary of the date
of such Change in Control.
"Change in
Control" shall mean any merger, consolidation, sale of assets or
other similar transaction or series of transactions involving the
Corporation, other than any such transaction or transactions
following which the Corporation or its stockholders continue to own
a majority of the combined voting power of the outstanding
securities of the Corporation or other entity surviving or
succeeding to the business of the Corporation.
6.
Registration Rights. The Corporation hereby covenants and
agrees to register on an SEC Form S-8, or other applicable SEC
Form, as soon as reasonably practicable, as may be necessary under
the Securities Laws to permit the resale of the Optioned Shares
issued upon exercise of this Option by the Optionee.
