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Exhibit 10.34
STOCK OPTION AGREEMENT
OF
RIM SEMICONDUCTOR COMPANY
STOCK OPTION AGREEMENT (this "Agreement") entered into this 26th
day of January
2006, between Rim Semiconductor Company, a Utah corporation (the
"Corporation"),
and Raymond F. Willenberg, Jr. (the "Optionee," which term as used
herein shall
be deemed to include any successor to the Optionee by will or by
the laws of
descent and distribution, unless the context shall otherwise
require).
The Board of Directors of the Corporation approved the issuance to
the Optionee,
effective as of the date set forth above, of a nonqualified stock
option to
purchase up to an aggregate of 10,700,000 shares of the common
stock, par value
$.00 I per share, of the Corporation (the "Common Stock"), at an
exercise price
of $ 0.027 per share (the "Option Price"), upon the terms and
conditions
hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual premises and
undertakings
hereinafter set forth, the parties hereto agree as follows:
1. Option; Option Price. The Board of Directors hereby grants as of
the date of
this Agreement to the Optionee the option (the "Option") to
purchase, subject to
the terms and conditions of this Agreement 10,700,000 shares of the
Common Stock
of the Corporation at an exercise price per share equal to the
Option Price.
2. Term. The term (the "Option Term") of the Option shall commence
on the date
of this Agreement and shall terminate on January 26, 2016 unless
such Option
shall theretofore have been terminated in accordance with the terms
hereof.
3. Vesting.
(a) Subject to the provisions of Sections 5 and 8 hereof, on each
Measurement
Date set forth in Column 1 below, the Option shall vest and become
exercisable
for the corresponding number of shares of Common Stock set forth in
Column 2
below if the Option has not earlier terminated as provided in
Section 4 hereof.
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Column 1
Column 2
Shares Vesting on Measurement
Measurement Date
Date
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February 1, 2006
1,700,000
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March 1, 2006
1,800,000
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April 1, 2006
1,800,000
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May 1, 2006
1,800,000
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June 1, 2006
1,800,000
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July 1, 2006
1,800,000
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(b) Notwithstanding the provisions of Section 3(a) hereof, the
Option shall
become fully vested and shall become immediately exercisable with
respect to all
shares subject to the Option, subject to the provisions hereof,
immediately
following a Change in Control (as hereinafter defined) of the
Corporation. For
purposes of this Agreement and the Option, the term "Change in
Control" shall
have the definition set forth in Section 409A of the Intemal
Revenue Code of
1986, as amended ("IRC"), and the regulations promulgated
thereunder.
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(c) Subject to the provisions of Sections 5 and 8 hereof, the
shares as to which
the Option is exercisable may be purchased at any time prior to the
expiration
or termination of the Option.
4. Termination of Option.
(a) The unexercised portion of the Option shall automatically and
without notice
terminate and become null and void at the time of the earliest to
occur of the
following:
(i) thirty (30) days after the date that the Optionee ceases
to be an employee of the Company regardless of the reason
therefore
other than as a result of death or Permanent Disability of
Optionee;
(ii) three (3) months after the date that Optionee ceases to
be an employee of the Company by reason of death or Permanent
Disability of Optionee; or
(iii) the expiration date of the term of the Option.
(b) "Permanent Disability" means that Optionee becomes physically
or mentally
incapacitated or disabled so that Optionee is unable to perform
substantially
the same services as Optionee performed prior to incurring such
incapacity or
disability (the Company, at its option and expense, being entitled
to retain a
physician to confirm the existence of such incapacity or
disability, and the
determination of such physician to be binding upon the Company and
Optionee),
and such incapacity or disability continues for a period of three
consecutive
months or six months in any 12-month period or such other period(s)
as may be
determined by the Board of Directors.
5. Procedure for Exercise.
(a) Subject to the requirements of Section 8, the Option may be
exercised, from
time to time, in whole or in part (but for the purchase of a whole
number of
shares only), by delivery of a written notice (the "Notice") from
the Optionee
to the Secretary of the Corporation, which Notice shall:
(i) state that the Optionee elects to exercise the Option;
(ii) state the number of shares with respect to which the
Option is being exercised (the "Optioned Shares");
(iii) state the date upon which the Optionee desires to
consummate the purchase of the Optioned Shares (which date must
be
prior to the termination of such Option and no later than thirty
(30)
days after the date of receipt of such Notice);
(iv) include any representations of the Optionee required
under Section 8(c); and
(v) if the Option shall be exercised pursuant to Section 10 by
any person other than the Optionee, include evidence to the
satisfaction of the Board of Directors of the right of such person
to
exercise the Option.
(b) Payment of the Option Price for the Optioned Shares shall be
made (i) in
U.S. dollars by personal or company check, bank draft or money
order payable to
the order of the Corporation or by wire transfer, or (ii) by
delivery of such
other consideration as the Board of Directors may deem
acceptable.
(c) The Corporation shall issue a stock certificate in the name of
the Optionee
(or such other person exercising the Option in accordance with the
provisions of
Section 10) for the Optioned Shares as soon as practicable after
receipt of the
Notice and payment of the aggregate Option Price for such
shares.
6. No Rights as a Stockholder. The Optionee shall have no rights as
a
stockholder of the Corporation with respect to any Optioned Shares
until the
date the Optionee or, if Optionee is a natural person, his nominee
(which, for
purposes of this Agreement, shall include any third party agent
selected by the
Board of Directors to hold such Optioned Shares on behalf of the
Optionee),
guardian or legal representative is the holder of record of such
Optioned
Shares.
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7. Adjustments.
(a) If at any time while the Option is outstanding, there shall be
any increase
or decrease in the number of issued and outstanding shares of
Common Stock
through the declaration of a stock dividend, stock split,
combination of shares
or through any recapitalization resulting in a stock split-up,
spin-off,
combination or exchange of shares of Common Stock, then and in each
such event
appropriate adjustment shall be made in the number of shares and
the exercise
price per share covered by the Option, so that the same proportion
of the
Corporation's issued and outstanding shares of Common Stock shall
remain subject
to purchase at the same aggregate exercise price.
(b) Except as otherwise expressly provided herein, the issuance by
the
Corporation of shares of its capital stock of any class, or
securities
convertible into shares of capital stock of any class, either in
connection with
a direct sale or upon the exercise of rights or warrants to
subscribe therefor,
or upon conversion of shares or obligations of the Corporation
convertible into
such shares or other securities, shall not affect, and no
adjustment by reason
thereof shall be made with respect to, the number of or exercise
price of shares
of Common Stock covered by the Option.
(c) Without limiting the generality of the foregoing, the existence
of the
Option shall not affect in any manner the right or power of the
Corporation to
make, authorize or consummate (i) any or all adjustments,
recapitalizations,
reorganizations or other changes in the Corporation's capital
structure or its
business; (ii) any merger or consolidation of the Corporation;
(iii) any issue
by the Corporation of debt securities, or preferred or preference
stock that
would rank above the shares of Common Stock covered by the Option;
(iv) the
dissolution or liquidation of the Corporation; (v) any sale,
transfer or
assignment of all or any part of the assets or business of the
Corporation; or
(vi) any other corporate act or proceeding, whether of a similar
character or
otherwise.
(d) If the Corporation shall consummate any merger, consolidation,
business
combination or other reorganiza
