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Exhibit
10.7
SUN COPY
SUN MICROSYSTEMS,
INC.
DIRECTORS’
NONSTATUTORY STOCK OPTION AGREEMENT
GRANT #
SUN MICROSYSTEMS, INC., a
Delaware corporation (the “Company”) has granted to
(the “Optionee”), an option to purchase a total of
shares of the Company’s Common Stock, at the price determined
as provided herein, and in all respects subject to the terms,
definitions and provisions of the 1988 Directors’ Stock
Option Plan (the “Plan”) adopted by the Company which
is incorporated herein by reference. The terms defined in the Plan
shall have the same defined meanings herein.
This option is a nonstatutory
option and is not intended to qualify for any special tax benefits
to the Optionee.
The option price is $
for each share of Common Stock, which is 100% of the fair market
value of the Common Stock on the date of grant of this
Option.
This Option shall be
exercisable during its term in accordance with the provisions of
Section 9 of the Plan as follows:
(i) This Option shall become
exercisable in cumulative installments of twenty-five percent
(25%) of the Shares subject to the Option on each of the
first, second, third and fourth anniversaries of the date of grant
specified on page 3 of this Agreement (each a “Vesting
Date”); provided, however, if the Company’s Annual
Meeting of Stockholders for any year after the Annual Meeting date
on which the Option is granted is held prior to a Vesting Date, the
Vesting Date for that year shall be the date of the Annual Meeting
of Stockholders. Notwithstanding the foregoing, in no event shall
any portion of the Option vest before the date six (6) months
after the date of grant of the Option.
(ii) This Option may not be
exercised for a fraction of a share.
(iii) In the event of
Optionee’s death, disability or other termination of service
as a Director, the exercisability of the Option is governed by
Section 6, 7 and 8 of this Agreement.
This Option shall be
exercisable by written notice which shall state the election to
exercise the Option, the number of Shares in respect of which the
Option is being exercised, and such other representations and
agreements as to the holder’s investment intent with respect
to such Shares of Common Stock as may be required by the Company
pursuant to the provisions of the Plan. Such written notice shall
be signed by the Optionee and shall be delivered in person or by
certified mail to the Secretary of the Company. The written notice
shall be accompanied by payment of the exercise price.
Page 2
Directors’ Nonstatutory Stock
Option Agreement
Payment of the exercise price
shall be by any of the following, or a combination thereof, at the
election of the Optionee.
(a) cash; (b) check; or
(c) surrender of other Shares of Common Stock of the Company
having a fair market value equal to the exercise price of the
Shares with respect to which the Option is being
exercised.
| 5) |
RESTRICTIONS ON EXERCISE |
This option may not be
exercised if the issuance of such Shares upon such exercise or the
method of payment of consideration for such shares would constitute
a violation of any applicable federal or state securities or other
law or regulations, or if such
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