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Exhibit
10.1
AMENDED AND RESTATED
STOCK SALE RESTRICTION AGREEMENT
This Amended and Restated
Stock Sale Restriction Agreement (this “ Agreement
”) is entered into as of January 23, 2007 (the “
Effective Date ”) by and between Luna Innovations
Incorporated, a Delaware corporation (the “ Company
”) and Kent A. Murphy (“ Employee ”). The
Company and Employee are referred to herein as the “
Parties ” and each as a “ Party
.”
RECITALS
WHEREAS, the Parties entered
into a certain letter agreement dated on or about February 1,
2006 (the “ Stock Sale Restriction Agreement ”)
whereby Employee agreed to certain restrictions on the sale and
transfer of (i) any outstanding shares of the Company’s
Common Stock, par value $0.001 per share (“ Common
Stock ”) (excluding shares that were received upon
exercise of options prior to December 31, 2005) and
(ii) any shares of Common Stock to be received upon exercise
of options to purchase Common Stock, whether vested or unvested,
that Employee held and acquired from the Company prior to the
Company’s initial public offering;
WHEREAS, as of the Effective
Date, Employee beneficially held an aggregate of 2,750,208 shares
of Common Stock, which consisted of 2,637,161 outstanding shares of
Common Stock and 113,047 shares of Common Stock issuable upon
exercise of outstanding options (collectively, the “
Subject Securities ”), excluding any shares that were
received upon exercise of options or warrants prior to
December 31, 2005;
WHEREAS, the Parties agree
and acknowledge that it is in the interests of the Company and its
stockholders to amend and restate the Stock Sale Restriction
Agreement to provide for additional restrictions on the number of
Subject Securities which Employee can sell, with the expectation
that such additional restrictions may help to prolong the
Company’s eligibility for Small Business Innovation Research
(“ SBIR ”) grants; and
WHEREAS, the Parties desire
to amend and restate the Stock Sale Restriction Agreement pursuant
to the terms and conditions provided herein.
NOW, THEREFORE, in
consideration of the premises and covenants set forth herein and
for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties hereto
agree as follows:
AGREEMENT
1. Employee hereby irrevocably agrees
that he or she will not, directly or indirectly, (i) sell,
offer for sale, pledge or otherwise dispose of (except as otherwise
provided herein) greater than zero percent (0%) of Employee’s
Subject Securities in calendar year 2007 and ten percent
(10%) of Employee’s Subject Securities in calendar year
2008 (each such amount the “ Annual Limit ”) or
(ii) enter into any swap or other derivatives transaction that
transfers to another, in whole or in part, any of the economic
benefits or risks of ownership of greater than the Annual Limit in
any given year of the Employee’s Subject Securities, whether
any such transaction described in clause (i) or
(ii) above is to be settled by delivery of Common Stock or
other securities, in cash
or otherwise. For purposes of this
Agreement, gifts or transfers of Subject Securities to immediate
family members or trusts for which Emp
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