Sub-Urban Industries, Inc. 2003 Equity Incentive Plan Summary
This agreement outlines the 2003 Equity Incentive Plan for Sub-Urban Industries, Inc., allowing the company to grant up to 8,000,000 stock options or restricted shares to employees, directors, and consultants. The plan specifies eligibility, types of awards, vesting schedules, exercise prices, and conditions for accelerated vesting in case of a change in control. It also details payment methods for exercising options, transfer restrictions, and the requirement for stockholder approval within 12 months of adoption.
Exhibit 10.2
SUB-URBAN INDUSTRIES, INC. 2003 EQUITY INCENTIVE PLAN KEY FEATURES SUMMARY
| Size of Share Pool | 750,000 shares (Note: amended by Board resolution of December 31, 2005 to increase to a total pool of 8,000,000 options) |
| Types of Grants | • Incentive Stock Options (ISOs) |
|
| • Nonstatutory Stock Options (NSOs) |
|
| • Shares of Restricted Stock |
| Administration | Board of Directors or a committee consisting of at least one director |
| Eligibility | • Employees |
|
| • Non-Employee Directors |
|
| • Consultants |
|
| ISOs are available only to employees |
| Exercise Price of | • Minimum exercise price of ISOs is 100% of fair value at time of grant |
| Options | • Minimum exercise price of NSOs is 85% of fair value at time of grant |
| Vesting of Options | • Minimum vesting is 20% per year for five years after grant (not applicable to officers, directors and consultants) |
|
| • In general, Company intends to grant options that vest over years, with % vesting after a -month cliff and equal monthly increments for the next years |
|
| • Company intends to use “reverse vesting” (option is immediately exercisable but option shares are subject to repurchase at exercise price until vested) |
| Accelerated Vesting | Options vest in full in the event Company is subject to a change in control, unless: |
|
| • Option agreement provides differently, or |
|
| • Options remain outstanding after the change in control, or |
|
| • Options are assumed by the surviving corporation or its parent, or |
|
| • The surviving corporation or its parent substitutes options with substantially the same terms |
|
| “Change in control” means (a) a merger after which Company’s stockholders own less than 50% of the surviving company’s stock or (b) a sale of Company’s assets |
| Payment of | • Cash |
| Exercise Price | • “Stock swap” (paying the exercise price with shares already owned) |
|
| • “Option swap” (paying the exercise price with vested options that are “in the money”) |
|
| • Same-day sale (only possible after an IPO) |
|
| • Margin loan (only possible after an IPO) |
|
| Plan also allows the use of promissory notes, but Company does not intend to use that feature for now |
| Term of Options | Maximum term is 10 years |
| Post-Termination | • Three months, except as specified below |
| Period | • 12 months in case of death |
| Special Rules for | • Minimum exercise price of ISOs and NSOs is 110% of fair value at time of grant |
|
| • Maximum term of ISOs is five years (rather than 10) |
| Transfer | • Company has right of first refusal on option shares |
| Restrictions | • Optionees are subject to market stand-off (lock-up) in the event of an IPO |
| Stockholder | Stockholder approval is required within 12 months after adoption of Plan (but should occur as soon as possible for accounting reasons) |
2
