Document

Exhibit 10.27

NEXTDOOR.COM, INC.
2008 EQUITY INCENTIVE PLAN 
NOTICE OF STOCK OPTION GRANT
You  have  been  granted  the  following  option  to  purchase  shares  of  the  Common  Stock  of Nextdoor.com, Inc., a Delaware corporation (the “Company”):
									
	Participant:		
			
	Social Security Number: 		
			
	Address:		
			
			
	Total Option Shares:		
			
	Exercise Price Per Share:	$	
			
	Date of Grant:		
			
	Exercise Period:	This Option will become vested and exercisable as to portions of the  Shares  as  follows:   (i) this  Option  shall  not  vest  nor  be exercisable with respect to any of the Shares until the First Vesting Date set forth below, (ii) on the First Vesting Date the Option will become vested and exercisable as to 1/4th of the Shares  and  (iii) thereafter  at  the  end  of  each  full  succeeding calendar month this Option will become vested and exercisable as to 1/48th of the Shares until the Shares are vested with respect to all of the Shares._______________________________

			
	First Vesting Date: 		
			
	Expiration Date:		
		(unless  earlier  terminated  under  Section 5.6  of  the  Plan  (as defined below))
			
	Classification of Optionee	[  ] Exempt Employee	
		[  ] Nonexempt Employee	
			
	Type of Stock Option		
	(Check one):	[  ] Incentive Stock Option	
		[  ] Nonqualified Stock Option	


Participant hereby acknowledges receipt of a copy of the Company’s 2008 Equity Incentive Plan (the “Plan”) and the Stock Option Agreement, both of which are attached to and made a part of this document. By Participant’s signature and the signature of the Company’s representative below, Participant and the Company agree that this Option is granted under and governed by the terms and conditions of this Notice of Stock Option Grant, the Stock Option Agreement and the Plan.  Participant has read and understands the terms and provisions hereof and thereof, and accepts the Option subject to all the terms and conditions of  this  Notice  of  Stock  Option  Grant,  the  Stock  Option  Agreement  and  the  Plan.  Participant 








acknowledges that there may be adverse tax consequences upon exercise of this Option or disposition of the Shares and that Participant should consult a tax adviser prior to such exercise or disposition.
												
	NEXTDOOR.COM, INC.
		PARTICIPANT

				
	By:			
				(Signature)
				
			
	(Please print name)		(Please print name)
				
			
	(Please print title)		


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NEXTDOOR.COM, 
INC.
2008 EQUITY INCENTIVE
PLAN STOCK OPTION
AGREEMENT
1.    GRANT OF OPTION.  The Company hereby grants to Participant an option (this “Option”) to purchase the total number of shares of the Company’s Common Stock, $0.0001 par value per share, set forth in the Notice of Stock Option Grant as Total Option Shares (the “Shares”) at the Exercise Price Per Share set forth in the Notice  of Stock  Option  Grant (the “Exercise Price”), subject to all of the terms and conditions  of this Agreement, the Notice of Stock Option Grant and the Plan.  If designated as an Incentive Stock Option in the Notice of Stock Option Grant, the Option is intended to qualify as an “incentive stock option” (the “ISO”) within  the meaning of Section 422 of the Internal  Revenue Code of 1986, as amended  (the “Code”).
2.    EXERCISE PERIOD.
2.1    Exercise Period of Option.   Provided  Participant  continues  to  provide services to the Company or any Subsidiary or Parent of the Company, the Option will become vested and exercisable as to portions of the Shares as set forth in the Notice of Stock Option Grant.  If application  of the vesting percentage causes a fractional share, such share shall be rounded  down to the nearest whole share for each month except  for the last month in such vesting period, at the end of which last month this Option shall become exercisable for the full remainder of the Shares.
2.2    Additional Agreement(s).  Participant  acknowledges  and agrees, that if upon  exercise  of  this  Option  pursuant  to  Section  4 hereof  Participant  holds  shares of  the Company’s  capital   stock   constituting   one  percent   (1%)   of  the   Company’s  issued  and outstanding  shares of capital  stock  (treating  for  this  purpose  all shares of Common  Stock issuable  upon  exercise  of  or  conversion  of  outstanding  options,  warrants  or  convertible securities, as if exercised or converted), then Participant shall become bound by, and subject to, Section 3 of that certain Voting and Drag-Along Agreement, dated as of January 25, 2008, as  such  agreement  may  be  amended  or  amended  and  restated  from  time  to  time,  as  a “Holder” thereto.
2.3    Vesting of Options.  Shares that are vested pursuant to the schedule set forth in the Notice of Stock Option Grant and Section 2.1 are “Vested Shares.”   Shares that are not vested  pursuant  to the schedule  set forth  in the Notice  of Stock  Option  Grant and Section 2.1 are “Unvested Shares.”
2.4    Expiration.   The Option  shall expire on the Expiration Date set forth in the Notice  of Stock  Option  Grant or earlier as provided  in Section 3 below  or  pursuant  to Section 5.6 of the Plan.
3.    TERMINATION.
3.1    Termination  for Any Reason  Except  Death,  Disability or Cause.   If Participant  is Terminated for any reason, except death, Disability or for Cause, the Option, to the extent 
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(and only to the extent) that it would  have been exercisable by Participant  on the Termination  Date, may be exercised  by Participant  no later than three  (3) months  after the Termination Date, but in any event no later than the Expiration Date.
3.2    Termination   Because   of  Death   or   Disability.     If  Participant   is Terminated  because  of death or Disability  of Participant  (or  Participant  dies within  three (3) months of Termination when Termination is for any reason other than Participant’s Disability or for Cause),  the Option,  to the extent that it is exercisable  by Participant  on  the Termination Date,  may  be  exercised  by  Participant  (or Participant’s legal  representative)  no  later  than twelve (12) months  after the Termination  Date, but in any  event no later than the Expiration Date.     Any  exercise  beyond   (i) three  (3)  months   after  the  Termination  Date  when  the Termination is for any reason other than the Participant’s death or disability, within the meaning of Section 22(e)(3) of the Code; or (ii) twelve (12) months after the Termination Date when the termination is for Participant’s disability, within the meaning of Section 22(e)(3) of the Code, is deemed to be an NQSO.
3.3    Termination for Cause.   If the Participant  is terminated  for Cause, the Participant  may exercise such Participant’s Options,  but not to an extent  greater  than such Options  are exercisable  as to  Vested  Shares upon  the  Termination  Date and  Participant’s Options shall expire on such Participant’s Termination Date, or at such later time and on such conditions as are determined by the Committee.
3.4    No  Obligation  to  Employ.   Nothing  in the Plan, the Notice  of  Stock Option Grant or this Agreement shall confer on Participant any right to continue in the employ of, or other relationship with, the Company or any Parent or Subsidiary of the Company, or limit in any way the right of the Company or any Parent or Subsidiary of the Company to terminate Participant’s employment or other relationship at any time, with or without Cause.
4.    MANNER OF EXERCISE.
4.1    Stock Option Exercise Agreement.  To exercise this Option, Participant (or in  the  case  of  exercise  after  Participant’s   death  or  incapacity,  Participant’s   executor, administrator,  heir or legatee, as the case may be) must deliver to the Company an executed stock option exercise agreement in the form attached hereto as Exhibit A, or in such other form as may be approved by the Committee  from time to time (the “Exercise Agreement”),  which shall set  forth,  inter alia, (i) Participant’s election  to  exercise  the  Option,  (ii) the  number  of Shares   being   purchased,    (iii) any   restrictions    imposed    on   the   Shares   and   (iv) any representations,  warranties  and  agreements  regarding  Participant’s   investment  intent  and access to information as may be required by the Company to comply with applicable securities laws.  If someone other than Participant  exercises the Option, then such person must submit documentation reasonably acceptable to the Company verifying that such person has the legal right to exercise the Option and such person shall be subject to all of the restrictions contained herein as if such person were the Participant.
4.2    Limitations on Exercise.  The Option may not be exercised unless such exercise is in compliance  with all applicable  federal and state securities laws, as they are in effect on the date of exercise.  The Option may not be exercised as to fewer than one hundred (100) Shares unless it is exercised as to all Shares as to which the Option is then exercisable.
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4.3    Payment.     The  Exercise  Agreement  shall  be  accompanied   by   full payment  of the Exercise Price for the shares being purchased  in cash (by  check),  or  where permitted by law:
(a)    by   cancellation   of   indebtedness    of   the   Company   to   the Participant;
(b)    by  waiver  of  compensation   due  or  accrued  to  Participant for services rendered;
(c)    provided  that  a public  market  for  the  Company’s stock  exists: (i) through  a “same day  sale”  commitment   from  Participant  and  a broker-dealer  that  is  a member  of  the  National  Association  of  Securities  Dealers  (an  “NASD  Dealer”)  whereby Participant  irrevocably  elects  to exercise  the Option  and to sell a  portion  of the Shares so purchased  sufficient  to  pay  for  the  total  Exercise  Price  and  whereby  the  NASD  Dealer irrevocably commits upon receipt of such Shares to forward the total Exercise Price directly to the Company,  or (ii) through  a “margin” commitment  from  Participant  and an NASD Dealer whereby  Participant  irrevocably  elects  to  exercise  the Option  and to  pledge  the Shares so purchased  to  the NASD Dealer in a margin  account  as security  for a loan from  the NASD Dealer in the amount  of the total  Exercise  Price, and whereby  the NASD Dealer irrevocably commits  upon  receipt  of  such  Shares  to  forward  the  total  Exercise  Price  directly  to  the Company;
(d)    any other form of consideration approved by the Committee; or
(e)    by any combination  of the foregoing.
4.4    Tax Withholding.  Prior to the issuance of the Shares upon exercise of the  Option,  Participant   must  pay  or  provide  for  any  applicable   federal,  state  and  local withholding  obligations of the Company.  If the Committee permits, Participant may provide for payment  of withholding  taxes upon  exercise of the Option  by requesting  that  the Company retain the minimum number of Shares with a Fair Market Value equal to the minimum amount of taxes required  to be withheld;  but in no event will the Company  withhold  Shares if such withholding  would result in adverse accounting  consequences to the Company.  In such case, the Company shall issue the net number of Shares to the Participant by deducting  the Shares retained from the Shares issuable upon exercise.
4.5    Issuance   of  Shares.     Provided   that  the  Exercise  Agreement   and payment  are in form and substance  satisfactory  to counsel for the Company,  the  Company shall issue the Shares registered in the name of Participant, Participant’s authorized assignee, or Participant’s legal representative, and shall deliver certificates representing the Shares with the appropriate legends affixed thereto.
5.    NOTICE OF DISQUALIFYING DISPOSITION OF ISO SHARES.  If the Option is an ISO, and if Participant sells or otherwise disposes of any of the Shares acquired pursuant to the ISO on or before the later of (i) the date two (2) years after the Date of Grant, and (ii) the date  one (1) year after transfer  of such  Shares to  Participant  upon  exercise  of the Option, Participant  shall immediately  notify  the Company  in writing  of such disposition.    Participant agrees that  Participant  may be subject  to  income  tax  withholding  by the Company  on the compensation  income recognized by Participant from the early disposition  by payment in cash or out of the current wages or other compensation  payable to Participant.
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6.    COMPLIANCE WITH LAWS AND REGULATIONS.     The  Plan,  the  Notice  of Stock  Option Grant and this Agreement are intended  to comply  with Section 25102(o) of the California Corporations  Code and any regulations relating thereto.  Any provision of the Notice of Stock  Option  Grant or this Agreement which  is inconsistent  with Section 25102(o) or any regulations  relating thereto  shall, without  further  act or amendment  by  the Company  or the Board, be reformed to comply  with the requirements of Section 25102(o) and any regulations relating thereto.   The exercise of the Option and the issuance and transfer of Shares shall be subject  to  compliance  by the Company  and  Participant  with  all applicable  requirements  of federal and state securities laws and with all applicable requirements of any stock exchange on which the Company’s Common Stock may be listed at the time of such issuance or transfer. Participant  understands  that  the Company  is under  no obligation  to  register  or qualify  the Shares with the SEC, any state securities commission  or any stock  exchange to effect such compliance.
7.    NONTRANSFERABILITY OF OPTION.   The Option  may not  be transferred  in any manner other than by will or by the laws of descent and distribution,  and, with respect to NQSOs, by instrument  to an inter vivos or testamentary  trust in which the options  are to be passed to beneficiaries upon the death of the trustor (settlor), or by gift to “immediate family” as that term is defined in 17 C.F.R. 240.16a-1(e), and may be exercised during the lifetime of Participant only by Participant or in the event of Participant’s incapacity,  by Participant’s legal representative.   The terms of the Option shall be binding upon the executors,  administrators, successors and assigns of Participant.
8.    COMPANY’S  RIGHT OF FIRST REFUSAL.  Before any Vested Shares held by Participant  or any transferee  of  such  Vested  Shares may  be sold  or otherwise  transferred (including  without  limitation  a transfer  by gift  or operation  of law),  the  Company  and/or  its assignee(s) shall have an assignable right of first refusal to purchase the Vested Shares to be sold or transferred on the terms and conditions  set forth in the Exercise Agreement (the “Right of First Refusal”).   The Company’s Right of First Refusal will terminate when the Company’s securities become publicly traded.
9.    TAX CONSEQUENCES.   Set forth below is a brief summary as of the Effective Date of the Plan of some of the federal and California tax consequences  of  exercise of the Option and disposition  of the Shares.  THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE.   PARTICIPANT SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THE  OPTION OR DISPOSING OF THE SHARES.
9.1    Exercise  of ISO.   If the  Option  qualifies  as an ISO, there  will  be  no regular federal or California income tax liability upon the exercise of the Option, although the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price will be treated as a tax preference item for federal alternative minimum tax purposes and may subject the Participant to the alternative minimum tax in the year of exercise.
9.2    Exercise of Nonqualified Stock Option.  If the Option does not qualify as an ISO, there may be a regular federal and California income tax liability upon the exercise of the Option.  Participant will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price.  If Participant  is a current or former employee of the Company, the Company may be required to withhold from Participant’s  compensation  or collect  from  Participant  and pay  to  the applicable  taxing  authorities  an amount  equal to  a percentage of this compensation  income at the time of exercise.
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9.3    Disposition  of  Shares.    The following  tax  consequences  may  apply upon disposition of the Shares.
(a)    Incentive  Stock  Options.    If the Shares are held for more  than twelve (12) months after the date of purchase of the Shares pursuant to the exercise of an ISO and are disposed  of more than two  (2) years after the Date of Grant, any  gain  realized on disposition  of the Shares will be treated  as long term capital  gain for  federal and California income  tax purposes.   If Vested Shares purchased  under an ISO  are disposed  of within the applicable  one (1) year or two  (2) year period,  any gain  realized on such disposition  will be treated  as  compensation   income  (taxable  at  ordinary  income  rates  in  the  year  of  the disposition) to the extent of the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price.
(b)    Nonqualified Stock Options.  If the Shares are held for more than twelve (12) months  after the date of purchase  of the Shares pursuant  to the  exercise of an NQSO, any gain realized on disposition of the Shares will be treated as long-term capital gain.
(c)    Withholding.  The Company may be required to withhold from the Participant’s compensation  or collect  from  the Participant  and pay to the applicable  taxing authorities an amount equal to a percentage of this compensation  income.
10.    PRIVILEGES OF STOCK OWNERSHIP.   Participant  shall not have any of the rights of a stockholder  with respect to any Shares until the Shares are issued to Participant.
11.    INTERPRETATION.   Any dispute  regarding  the interpretation  of the Notice  of Stock Option Grant or this Agreement shall be submitted  by Participant or the Company to the Committee  for review.   The resolution  of such a dispute  by the Committee  shall be final and binding on the Company and Participant.
12.    ENTIRE  AGREEMENT.   The Notice  of Stock  Option  Grant and the Plan  are incorporated  herein by reference.  This Agreement, the Notice of Stock Option Grant and the Plan constitute  the entire agreement of the parties and supersede all prior undertakings  and agreements with respect to the subject matter hereof.
13.    NOTICES.   Any notice required to be given or delivered to the Company under the terms of this Agreement shall be in writing and addressed to the Corporate Secretary of the Company  at its principal  corporate  offices.   Any notice  required  to be given or delivered  to Participant  shall be in writing  and addressed  to  Participant  at the address  set forth  in  the Notice of Stock Option Grant or to such other address as such party may designate in writing from time to time to the Company.  All notices shall be deemed to have been given or delivered upon:  (i) personal delivery; (ii) three (3) days after deposit in the United States mail by certified or registered  mail (return  receipt  requested); (iii) one (1) business  day after deposit  with  any return  receipt  express  courier  (prepaid);  or  (iv) one  (1)  business  day  after  transmission  by facsimile, rapifax or telecopier.
14.    SUCCESSORS  AND  ASSIGNS.   The Company  may assign  any of its  rights under the Notice of Stock  Option  Grant and this Agreement, including  its rights to purchase Shares under the Right of First Refusal.  This Agreement shall be binding upon and inure to the benefit of the successors and assigns of the Company.  Subject to the restrictions  on transfer set forth herein, the Notice of Stock  Option Grant and this Agreement shall be binding  upon Participant and Participant’s heirs, executors, administrators,  legal representatives, successors and assigns.
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15.    GOVERNING LAW.  The Notice of Stock Option Grant and this Agreement shall be governed by and construed  in accordance  with the laws of the State of California as such laws are applied to agreements between California residents entered into and to be performed entirely  within  California.    If  any  provision  of  the  Notice  of  Stock  Option  Grant  or  this Agreement is determined by a court of law to be illegal or unenforceable, then such provision will be enforced  to  the maximum  extent  possible  and  the other  provisions  will remain fully effective and enforceable.
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EXHIBIT A
FORM OF STOCK OPTION EXERCISE AGREEMENT
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NEXTDOOR.COM,
INC.
2008 EQUITY INCENTIVE PLAN STOCK
OPTION EXERCISE AGREEMENT
This  Stock  Option  Exercise  Agreement (the “Exercise Agreement”) is made and entered into as of _________________________ (the “Effective Date”) by and between Nextdoor.com, Inc., a Delaware corporation  (the “Company”), and the purchaser named below (the “Purchaser”). Capitalized terms not defined herein shall have the meanings ascribed to them in the Company’s 2008 Equity Incentive Plan (the “Plan”).
						
	Purchaser:	
		
	Social Security Number:	
		
	Address:	
		
		
		
	Total Number of Shares:
	
		
	Exercise Price Per Share:	$
		
	Date of Grant:	
		
	First Vesting Date:	
		
	Expiration Date:	
		(Unless earlier terminated under Section 5.6 of the Plan)
		
	Type of Stock Option	
	(Check one):	[ ] Incentive Stock Option
		
		[ ] Nonqualified Stock Option


16.    EXERCISE OF OPTION.
16.1    Exercise.    Pursuant  to  exercise  of  that  certain  option  (the  “Option”) granted to Purchaser under the Plan and subject to the terms and conditions  of this Exercise Agreement, Purchaser hereby purchases from the Company, and the Company hereby sells to Purchaser,  the  Total  Number  of  Shares set  forth  above  (the  “Shares”)  of  the  Company’s Common Stock, par value $0.0001 per share, at the Exercise Price Per Share set forth above (the “Exercise Price”).   As used in this Exercise Agreement, the term “Shares” refers to the Shares purchased  under  this  Exercise  Agreement  and  includes  all securities  received  (i) in replacement of the Shares, (ii) as a result of stock dividends or stock splits with respect to the Shares,   and   (iii) all   securities   received   in   replacement   of   the   Shares   in   a   merger, recapitalization, reorganization or similar corporate transaction.
16.2    Additional   Agreement(s).     If,  upon   the  purchase   of  the   Shares, Purchaser holds shares of the Company’s capital stock  constituting  one percent (1%) of the Company’s 
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issued and outstanding  shares of capital stock (treating for this purpose all shares of Common Stock issuable upon exercise of or conversion of outstanding  options, warrants or convertible  securities, as if exercised or converted), then  Purchaser shall become  bound  by, and  subject  to,  Section  3  of  that  certain  Voting  and Drag-Along  Agreement,  dated  as of January  25, 2008,  a copy  of  which  has been  provided  to  Purchaser  if this  Section  1.2 is applicable  to Purchaser, as such agreement may be amended or amended and restated from time to time, as a “Holder” thereto.   Purchaser further agrees to execute  such agreements, documents and/or counterpart signature pages that are necessary to give effect to this Section 1.2 and as may be reasonably requested by the Company.
16.3    Title  to  Shares.     The  exact  spelling  of  the  name(s)   under   which Purchaser will take title to the Shares is:
________________________________________________________________
________________________________________________________________
Purchaser desires to take title to the Shares as follows:
[  ]    Individual, as separate property
[  ]    Husband and wife, as community property
[  ]    Joint Tenants
[  ]    Other; please specify:___________________________________________
To assign the Shares to a trust, a stock transfer agreement in the form provided by the Company (the “Stock Transfer Agreement”) must be completed and executed.
16.4    Payment.   Purchaser hereby delivers payment  of the Exercise Price  in the  manner  permitted  in the  Stock  Option  Agreement  as follows  (check  and  complete  as appropriate):
[ ]    in  cash  (by  check)  in  the  amount  of  $_____________,  receipt  of  which  is acknowledged  by the Company;
[ ]    by cancellation  of indebtedness  of the Company owed to Purchaser in the amount of $_______________; and/or
[ ]    by the waiver hereby of compensation  due or accrued for services rendered in the amount of $_______________.
17.    DELIVERY.
17.1    Deliveries by Purchaser.   Purchaser hereby delivers to the  Company (i) this Exercise Agreement, (ii) two (2) copies of a blank Stock Power and Assignment Separate from  Stock  Certificate  in the form  of Exhibit 1 attached  hereto  (the “Stock Powers”),  both executed by Purchaser (and Purchaser’s spouse, if any), (iii) if Purchaser is married, a Consent of  Spouse  in  the  form  of  Exhibit 2  attached  hereto  (the  “Spouse  Consent”)  executed  by Purchaser’s  spouse,  and  (iv) the  Exercise  Price  and  payment  or  other  provision  for  any applicable tax obligations  in the form of a check or other proofs of payment, as the case may be, a copy of which is attached hereto as Exhibit 3.
17.2    Deliveries  by the  Company.   Upon  its  receipt  of the Exercise  Price, payment  or other  provision  for any applicable  tax obligations  and all the  documents  to  be executed  and delivered by Purchaser to the Company  under Section 17.1, the Company  will issue a duly executed 
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stock certificate  evidencing the Shares in the name of Purchaser to be placed in escrow as provided in Section 25.
18.    REPRESENTATIONS   AND   WARRANTIES   OF   PURCHASER.    Purchaser represents and warrants to the Company that:
18.1    Agrees to Terms of the Plan.   Purchaser has received a copy  of  the Plan,  the  Notice  of  Stock  Option  Grant  and  the  Stock  Option  Agreement,  has  read  and understands  the  terms  of  the  Plan,  the  Notice  of  Stock  Option  Grant,  the  Stock  Option Agreement  and  this  Exercise  Agreement,  and  agrees  to  be  bound  by  their  terms  and conditions.    Purchaser  acknowledges  that  there  may  be  adverse  tax  consequences  upon exercise of the Option or disposition  of the Shares, and that Purchaser should consult  a tax adviser prior to such exercise or disposition.
18.2    Purchase for Own Account for Investment.   Purchaser is purchasing the Shares for Purchaser’s own account for investment purposes only and not with a view to, or for sale in connection  with, a distribution  of the Shares within the meaning of the Securities Act.  Purchaser has no present intention of selling or otherwise disposing  of all or any portion of the Shares and no one other than Purchaser has any  beneficial  ownership  of any of the Shares.
18.3    Access to Information.   Purchaser has had access  to all  information regarding  the  Company  and  its  present  and  prospective   business,  assets,  liabilities  and financial condition  that Purchaser reasonably  considers  important  in  making  the decision  to purchase  the  Shares,  and  Purchaser  has  had  ample  opportunity  to  ask  questions  of  the Company’s representatives concerning such matters and this investment.
18.4    Understanding  of  Risks.   Purchaser  is  fully  aware  of:    (i) the  highly speculative  nature of the investment  in the Shares; (ii) the financial hazards  involved;  (iii) the lack of liquidity  of the Shares and the restrictions  on transferability  of  the  Shares (e.g.,  that Purchaser may not be able to sell or dispose of the Shares or use them as collateral for loans); (iv) the qualifications  and backgrounds  of the management  of the Company;  and (v) the tax consequences of investment in the Shares.  Purchaser is capable of evaluating the merits and risks of this investment, has the ability to protect Purchaser’s own interests in this transaction and is financially capable of bearing a total loss of this investment.
18.5    No General Solicitation.   At no time was Purchaser presented  with or solicited by any publicly issued or circulated newspaper, mail, radio, television or other form of general advertising or solicitation in connection with the offer, sale and purchase of the Shares.
19.    COMPLIANCE WITH SECURITIES LAWS.
4.1    Compliance with U.S. Federal Securities Laws.  Purchaser understands and acknowledges that the Shares have not been registered with the SEC under the Securities Act and that, notwithstanding any other provision of the Notice of Stock Option Grant or the Stock Option Agreement to the contrary, the exercise of any rights to purchase any Shares is expressly conditioned  upon compliance with the Securities Act and all applicable state securities laws.  Purchaser agrees to cooperate with the Company to ensure compliance with such laws.
4.2    Compliance with California Securities Laws.  THE PLAN, THE NOTICE OF STOCK  OPTION  GRANT,  THE STOCK  OPTION  AGREEMENT, AND  THIS  EXERCISE AGREEMENT ARE INTENDED TO COMPLY WITH SECTION 25102(o) OF THE CALIFORNIA 
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CORPORATIONS  CODE  AND   ANY  RULES  (INCLUDING   COMMISSIONER   RULES,  IF APPLICABLE)  OR  REGULATIONS  PROMULGATED  THEREUNDER BY  THE  CALIFORNIA DEPARTMENT OF CORPORATIONS (THE  “REGULATIONS”).    ANY PROVISION OF THIS EXERCISE  AGREEMENT  THAT  IS   INCONSISTENT  WITH   SECTION  25102(o)   SHALL, WITHOUT  FURTHER ACT  OR  AMENDMENT  BY  THE  COMPANY  OR  THE  BOARD,  BE REFORMED TO COMPLY WITH THE REQUIREMENTS OF SECTION 25102(o). THE SALE OF THE SECURITIES THAT ARE THE SUBJECT OF THIS EXERCISE AGREEMENT, IF NOT YET QUALIFIED   WITH  THE  CALIFORNIA  COMMISSIONER  OF  CORPORATIONS  AND  NOT EXEMPT FROM SUCH QUALIFICATION, IS SUBJECT TO SUCH QUALIFICATION, AND THE ISSUANCE   OF   SUCH   SECURITIES,  AND   THE   RECEIPT  OF   ANY   PART   OF   THE CONSIDERATION THEREFOR PRIOR TO SUCH  QUALIFICATION IS UNLAWFUL  UNLESS THE SALE IS EXEMPT.  THE RIGHTS OF THE PARTIES TO THIS EXERCISE  AGREEMENT ARE EXPRESSLY CONDITIONED UPON SUCH QUALIFICATION BEING  OBTAINED OR AN EXEMPTION BEING AVAILABLE.
20.    RESTRICTED SECURITIES.
20.1    No Transfer  Unless  Registered  or Exempt.   Purchaser  understands that  Purchaser  may  not  transfer  any Shares unless  such  Shares  are  registered  under  the Securities Act or qualified  under applicable  state securities  laws or  unless, in the opinion  of counsel to the Company, exemptions from such registration and qualification  requirements are available.  Purchaser understands that only the Company may file a registration statement with the SEC and that the Company  is under no  obligation  to do so with respect  to the Shares. Purchaser has also been advised that exemptions  from registration  and qualification  may not be available or may not permit Purchaser to transfer all or any of the Shares in the amounts or at the times proposed by Purchaser.
20.2    SEC  Rule 144.    In  addition,  Purchaser  has  been  advised  that  SEC Rule 144  promulgated   under  the  Securities  Act,  which  permits   certain  limited   sales  of unregistered securities, is not presently available with respect to the Shares and, in any event, requires that the Shares be held for a minimum  of one (1) year, and in certain cases two (2) years,  after  they  have  been  purchased   and  paid  for  (within  the  meaning  of  Rule 144). Purchaser understands that Rule 144 may indefinitely restrict transfer of the Shares so long as Purchaser remains an “affiliate” of the Company  or if  “current public  information” about  the Company (as defined in Rule 144) is not publicly available.
20.3    SEC  Rule 701.    The  Shares  are  issued  pursuant  to  SEC  Rule 701 promulgated  under the Securities Act and may become freely tradeable by non-affiliates (under limited conditions  regarding the method of sale) ninety (90) days after the first sale of Common Stock of the Company to the general public pursuant to a registration statement filed with and declared effective by the SEC, subject to the lengthier market standoff agreement contained in Section 22 of  this  Exercise  Agreement  or any  other  agreement  entered  into  by  Purchaser. Affiliates  must  comply  with  the  provisions  (other  than  the  holding  period  requirements)  of Rule 144.
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21.    RESTRICTIONS ON TRANSFERS.
21.1    Disposition of Shares.   Purchaser hereby agrees that Purchaser  shall make no disposition  of the Shares (other than as permitted by this Exercise Agreement) unless and until:
(a)    Purchaser  shall  have  notified  the  Company  of  the  proposed disposition  and  provided  a written  summary  of  the  terms  and  conditions  of  the  proposed disposition;
(b)    Purchaser  shall  have  complied   with  all  requirements   of  this Exercise Agreement applicable to the disposition of the Shares;
(c)    Purchaser   shall   have   provided   the   Company   with   written assurances,  in  form  and  substance  satisfactory   to  counsel  for  the  Company,  that  (i) the proposed  disposition  does not require registration  of the Shares under the  Securities Act or (ii) all appropriate  actions  necessary for compliance  with the registration  requirements  of the Securities  Act  or  of  any  exemption   from  registration   available  under  the  Securities  Act (including Rule 144) have been taken; and
(d)    Purchaser   shall   have   provided   the   Company   with   written assurances, in form and substance satisfactory to the Company, that the proposed disposition will not result in the contravention of any transfer restrictions applicable to the Shares pursuant to the provisions of the Regulations referred to in Section 4.2 hereof.
21.2    Restriction on Transfer.   Purchaser  shall not  transfer,  assign, grant  a lien or security interest in, pledge, hypothecate,  encumber or otherwise dispose of any of the Shares which are subject to the Company’s Right of First Refusal described  below, except as permitted by this Exercise Agreement.
21.3    Transferee  Obligations.    Each  person  (other  than  the  Company)  to whom the Shares are transferred by means of one of the permitted  transfers specified in this Exercise  Agreement   must,   as  a  condition   precedent   to   the  validity   of  such   transfer, acknowledge  in writing  to the Company  that such person is bound  by the  provisions  of this Exercise Agreement  and  that  the transferred  Shares are subject  to  (i) both  the Company’s Right of First Refusal granted hereunder and (ii) the market stand-off provisions  of Section 22 hereof, to the same extent such Shares would be so subject if retained by the Purchaser.
22.    MARKET STANDOFF AGREEMENT.   Purchaser agrees in connection  with any registration  of  the  Company’s  securities  that,  upon  the  request  of  the  Company  or  the underwriters managing any public offering of the Company’s securities, Purchaser will not sell or otherwise dispose of any Shares without the prior written consent of the Company or such underwriters,  as the case may be, for such period of time (not to exceed one hundred eighty (180)  days; provided,  however,  that,  if during  the last seventeen (17)  days  of the restricted period the Company issues an earnings release or material news or a material event relating to the  Company   occurs,   or  prior  to  the  expiration   of  the  restricted   period  the  Company announces that it will release earnings results during the sixteen (16)-day period beginning on the last day of the restricted  period, and if the Company’s securities are listed on the Nasdaq Stock  Market and Rule 2711 thereof applies, then the restrictions  imposed  by this Section 7 shall continue  to apply until the  expiration  of the eighteen (18)-day  period  beginning  on the issuance  of the earnings  release or the occurrence  of the material  news or material event; provided, further, in no event will the restricted period extend beyond two hundred fifteen (215) 
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days  after  the  effective  date  of  the  registration  statement) after  the  effective  date  of  such registration  requested  by such  managing  underwriters  and subject  to  all restrictions  as the Company  or  the  underwriters  may  specify.     Purchaser  further  agrees  to  enter  into  any agreement reasonably required by the underwriters to implement the foregoing.
23.    COMPANY’S  RIGHT OF FIRST REFUSAL.  Before any Vested Shares held by Purchaser or any transferee of such Vested Shares (either sometimes referred to herein as the “Holder”) may be sold or otherwise transferred (including, without  limitation,  a transfer by gift or operation  of law),  the Company  and/or  its assignee(s)  will have a right  of first refusal to purchase the Vested Shares to be sold or transferred (the “Offered Shares”) on the terms and conditions set forth in this Section (the “Right of First Refusal”).
23.1    Notice  of Proposed  Transfer.   The Holder  of the Offered  Shares  will deliver  to  the  Company  a written  notice  (the  “Notice”) stating:    (i) the  Holder’s  bona  fide intention  to sell or otherwise  transfer the Offered Shares; (ii) the name and  address  of each proposed   purchaser  or  other  transferee  (the  “Proposed  Transferee”);  (iii) the  number  of Offered Shares to be transferred to each Proposed Transferee; (iv) the bona fide cash price or other consideration  for which the Holder proposes to transfer the Offered Shares (the “Offered Price”); and (v) that the Holder acknowledges  this Notice is an offer to sell the Offered Shares to the Company and/or its assignee(s) pursuant to the Company’s Right of First Refusal at the Offered Price as provided for in this Exercise Agreement.
23.2    Exercise of Right of First Refusal.   At any time within thirty (30) days after the date of the Notice, the Company and/or its assignee(s) may, by giving written notice to the Holder, elect to purchase all (or, with the consent of the Holder, less than all) the Offered Shares proposed  to be transferred to any one or more of the Proposed Transferees named in the Notice, at the purchase price, determined as specified below.
23.3    Purchase Price.  The purchase price for the Offered Shares purchased under this Section will be the Offered Price, provided  that if the Offered Price consists  of no legal consideration  (as, for example, in the case of a transfer by gift) the purchase price will be the fair market  value of the Offered  Shares as determined  in good  faith by the Company’s Board of Directors.  If the Offered Price includes consideration other than cash, then the value of  the  non-cash  consideration,  as  determined  in  good  faith  by  the  Company’s  Board  of Directors,  will  conclusively  be  deemed  to  be  the  cash  equivalent  value of  such  non-cash consideration.
23.4    Payment.  Payment of the purchase price for the Offered Shares will be payable, at the option  of the Company and/or  its assignee(s) (as applicable), by check or by cancellation  of all or a portion of any outstanding  purchase money indebtedness owed by the Holder to the Company (or to such assignee, in the case of a purchase of Offered Shares by such assignee) or by any combination  thereof.  The purchase price will be paid without interest within  sixty  (60)  days  after  the  Company’s receipt  of  the  Notice, or,  at  the  option  of  the Company and/or its assignee(s), in the manner and at the time(s) set forth in the Notice.
23.5    Holder’s Right to Transfer.  If all of the Offered Shares proposed  in the Notice to be transferred to a given Proposed  Transferee are not purchased  by the Company and/or its assignee(s) as provided in this Section, then the Holder may sell or otherwise transfer such Offered Shares to each Proposed  Transferee at the Offered Price  or at a higher price, provided  that (i) such sale or other transfer is consummated  within one hundred twenty (120) days after the date of the Notice, (ii) any such sale or other transfer is effected  in compliance with all applicable securities laws, and (iii) each Proposed 
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Transferee agrees in writing that the provisions  of this Section  will continue  to  apply to the Offered Shares in the hands of such Proposed Transferee.  If the Offered Shares described in the Notice are not transferred to each Proposed  Transferee within  such  one hundred  twenty  (120) day period,  then a new Notice must be given to the Company pursuant to which the Company will again be offered the Right of First Refusal before any Shares held by the Holder may be sold or otherwise transferred.
23.6    Exempt  Transfers.    Notwithstanding anything  to  the  contrary  in  this Section, the following transfers of Vested Shares will be exempt from the Right of First Refusal: (i) the  transfer  of  any or all of  the  Vested  Shares during  Purchaser’s  lifetime  by gift  or on Purchaser’s death by will or intestacy to Purchaser’s “Immediate Family” (as defined below) or to a trust  for the benefit  of Purchaser or Purchaser’s  Immediate  Family,  provided  that each transferee or other recipient agrees in a writing satisfactory to the Company that the provisions of this Section  will continue  to apply to the transferred  Vested Shares in the hands of such transferee or other recipient; (ii) any transfer or conversion of Vested Shares made pursuant to a statutory  merger or statutory consolidation of the Company with or into another corporation  or corporations  (except that the Right of First Refusal will continue to apply thereafter to such Vested Shares, in which case the surviving corporation  of such merger or consolidation  shall succeed to the rights of the Company under this Section unless (i)  the common  stock of the surviving corporation  or any direct or indirect parent corporation  thereof is registered under the Securities Exchange Act of 1934, as amended; or (ii) the agreement of merger or consolidation  expressly otherwise provides); or (iii) any transfer of Vested Shares pursuant to the winding up and dissolution  of the Company.   As used herein, the term  “Immediate Family”  will mean Purchaser’s  spouse,  the lineal descendant  or  antecedent,  father,  mother,  brother  or sister, child,  adopted  child,  grandchild  or  adopted  grandchild  of the Purchaser or the Purchaser’s spouse, or the spouse of any of the above.
23.7    Termination  of Right of First Refusal.   The Right of First Refusal  will terminate  as to  all Shares on the  effective  date  of  the  first  sale of  Common  Stock  of  the Company  to the general public  pursuant  to a registration  statement  filed with  and  declared effective by the SEC under the 1933 Act (other than a registration statement relating solely to the issuance of Common Stock pursuant to a business combination  or an employee incentive or benefit plan).
23.8    Encumbrances  on  Vested  Shares.    Purchaser  may  grant  a  lien  or security interest in, or pledge, hypothecate  or encumber  Vested Shares only if each party to whom such lien or security interest is granted, or to whom such pledge, hypothecation  or other encumbrance  is made,  agrees in a writing  satisfactory  to  the  Company  that:   (i) such  lien, security interest, pledge, hypothecation  or encumbrance  will not apply to such Vested Shares after they are acquired  by the Company  and/or  its  assignees under this Section;  and (ii) the provisions  of this Section will continue  to apply to such Vested Shares in the hands of such party and any transferee of such party.   Purchaser may not grant a lien or security interest in, or pledge, hypothecate or encumber, any Unvested Shares.
24.    RIGHTS AS A STOCKHOLDER.    Subject  to  the terms  and conditions  of  this Exercise Agreement, Purchaser will have all of the rights of a stockholder  of the Company with respect to the Shares from and after the date that Shares are issued to Purchaser until such time as Purchaser disposes of the Shares or the Company and/or its assignee(s) exercise(s) the Right of First Refusal.  Upon an exercise of the Right of First Refusal, Purchaser will have no further rights as a holder of the Shares so purchased upon such exercise, other than the right to  receive payment  for the Shares so purchased  in  accordance  with  the provisions  of this Exercise Agreement, and Purchaser will promptly surrender the stock certificate(s) evidencing the Shares so purchased to the Company for transfer or cancellation.
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25.    ESCROW.    As security  for  Purchaser’s  faithful  performance  of  this  Exercise Agreement, Purchaser agrees, immediately  upon receipt of the stock certificate(s) evidencing the  Shares,  to  deliver  such  certificate(s),  together  with  the  Stock  Powers  executed   by Purchaser and by Purchaser’s spouse, if any (with the date and number of Shares left blank), to the Secretary of the Company or other designee of the Company (the “Escrow Holder”), who is hereby appointed to hold such certificate(s) and Stock Powers in escrow and to take all such actions  and  to  effectuate   all  such  transfers  and/or  releases  of  such  Shares  as  are  in accordance  with the terms of this  Exercise Agreement.   Purchaser and the Company  agree that Escrow Holder will not be liable to any party to this Exercise Agreement (or to any other party) for any actions or omissions  unless Escrow Holder is grossly negligent or intentionally fraudulent in carrying out the duties of Escrow Holder under this Exercise Agreement.  Escrow Holder  may  rely  upon  any  letter,  notice  or  other  document  executed  with  any  signature purported  to  be genuine and may rely on the advice of counsel and obey any order of any court with respect to the transactions  contemplated  by this Exercise Agreement.   The Shares will be released from escrow upon termination of and the Right of First Refusal.
26.    RESTRICTIVE LEGENDS AND STOP-TRANSFER ORDERS.
26.1    Legends.    Purchaser  understands  and  agrees  that  the  Company  will place the legends set forth below or similar legends on any stock certificate(s) evidencing the Shares,  together  with  any  other  legends  that  may  be  required  by  state  or  U.S.  Federal securities  laws, the Company’s  Certificate  of Incorporation  or  Bylaws,  any other agreement between  Purchaser  and the Company  or any agreement  between  Purchaser  and any third party:
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER THE SECURITIES LAWS OF CERTAIN STATES. THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS, PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THE ISSUER OF THESE SECURITIES MAY REQUIRE AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY PROPOSED TRANSFER OR RESALE IS IN COMPLIANCE WITH THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS.
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON PUBLIC RESALE AND TRANSFER, INCLUDING THE RIGHT OF FIRST REFUSAL OPTIONS HELD BY THE ISSUER AND/OR ITS ASSIGNEE(S) AS SET FORTH IN A STOCK OPTION EXERCISE AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. SUCH PUBLIC SALE AND TRANSFER RESTRICTIONS INCLUDING THE RIGHT OF FIRST REFUSAL ARE BINDING ON TRANSFEREES OF THESE SHARES.
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THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A 180 DAY MARKET STANDOFF RESTRICTION AS SET FORTH IN A CERTAIN AGREEMENT BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. AS A RESULT OF SUCH AGREEMENT, THESE SHARES MAY NOT BE TRADED PRIOR TO 180 DAYS AFTER THE EFFECTIVE DATE OF ANY PUBLIC OFFERING OF THE COMMON STOCK OF THE ISSUER HEREOF. SUCH RESTRICTION IS BINDING ON TRANSFEREES OF THESE SHARES.
26.2    Stop-Transfer Instructions.        Purchaser    agrees    that,    to    ensure compliance with the restrictions imposed by this Exercise Agreement, the Company may issue appropriate   “stop-transfer”  instructions   to  its  transfer  agent,  if  any,  and  if  the  Company transfers its own securities, it may make appropriate  notations  to the same effect in its own records.
26.3    Refusal to Transfer.  The Company will not be required (i) to transfer on its books  any Shares that have been sold or otherwise  transferred  in violation  of any  of the provisions of this Exercise Agreement or (ii) to treat as owner of such Shares, or to accord the right to vote or pay dividends to any purchaser or other transferee to whom such Shares have been so transferred.
27.    TAX  CONSEQUENCES.    PURCHASER UNDERSTANDS THAT  PURCHASER MAY   SUFFER  ADVERSE  TAX   CONSEQUENCES  AS   A   RESULT  OF   PURCHASER’S PURCHASE  OR DISPOSITION OF THE SHARES.   PURCHASER  REPRESENTS:   (i) THAT PURCHASER  HAS  CONSULTED  WITH  ANY  TAX  ADVISER  THAT  PURCHASER  DEEMS ADVISABLE IN CONNECTION WITH THE PURCHASE OR DISPOSITION OF THE  SHARES AND (ii) THAT PURCHASER IS NOT RELYING ON THE COMPANY FOR ANY  TAX ADVICE. Set forth below is a brief summary as of the date the Plan was adopted by the Board of some of the U.S. Federal and California tax consequences  of exercise of the Option and disposition  of the Shares.  THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE.  PURCHASER SHOULD CONSULT HIS OR HER OWN TAX ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.
27.1    Exercise of Incentive Stock Option.  If the Option qualifies as an ISO, there will be no regular U.S. Federal income tax liability or California income tax liability upon the exercise of the Option, although the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price will be treated as a tax preference item for U.S. Federal  alternative  minimum  tax  purposes  and  may  subject  Purchaser  to  the  alternative minimum tax in the year of exercise.
27.2    Exercise of Nonqualified Stock Option.  If the Option does not qualify as an ISO, there may be a regular U.S. Federal income tax liability and a California income tax liability  upon  the  exercise  of  the  Option.    Purchaser  will  be  treated  as  having  received compensation  income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price.  If Purchaser is or  was  an  employee  of  the  Company,  the  Company  may  be  required  to  withhold  from Purchaser’s  compensation   or  collect   from   Purchaser  and  pay  to  the  applicable   taxing authorities  an amount  equal  to  a  percentage  of  this  compensation  income  at  the  time  of exercise.
27.3    Disposition of Shares. The following tax consequences may apply upon disposition of the Shares.
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(a)    Incentive  Stock  Options.    If the Shares are held for more  than twelve (12) months after the date of purchase of the Shares pursuant to the exercise of an ISO and are disposed  of more than two  (2) years after the Date of Grant, any  gain  realized on disposition  of the Shares will be treated  as long term capital  gain for  federal and California income  tax purposes.   If Vested Shares purchased  under an ISO  are disposed  of within the applicable  one (1) year or two  (2) year period,  any gain  realized on such disposition  will be treated  as  compensation   income  (taxable  at  ordinary  income  rates  in  the  year  of  the disposition) to the extent of the excess, if any, of the Fair Market Value of the Shares on the date of exercise over the Exercise Price.
(b)    Nonqualified Stock Options.  If the Shares are held for more than twelve (12) months  after the date of purchase  of the Shares pursuant  to the  exercise of an NQSO, any gain realized on disposition of the Shares will be treated as long term capital gain.
(c)    Withholding.  The Company may be required to withhold from the Purchaser’s  compensation  or collect  from  the  Purchaser  and  pay  to  the  applicable  taxing authorities an amount equal to a percentage of this compensation  income.
28.    COMPLIANCE WITH LAWS AND REGULATIONS.   The issuance and  transfer of  the  Shares  will  be  subject  to  and  conditioned  upon  compliance  by  the  Company  and Purchaser  with  all  applicable   state  and  U.S.  Federal  laws  and  regulations  and  with  all applicable  requirements of any stock exchange or automated  quotation  system on which the Company’s Common Stock may be listed or quoted at the time of such issuance or transfer.
29.    SUCCESSORS AND ASSIGNS.    The Company  may  assign  any  of  its  rights under this Exercise Agreement, including its rights to purchase Shares under the Right of First Refusal.    This Exercise  Agreement  shall  be  binding  upon  and  inure  to  the  benefit  of  the successors  and assigns of the Company.   Subject  to the restrictions  on transfer herein set forth,   this  Exercise  Agreement   will  be  binding   upon  Purchaser   and  Purchaser’s   heirs, executors, administrators, legal representatives, successors and assigns.
30.    GOVERNING LAW; SEVERABILITY.       This   Exercise   Agreement   shall   be governed by and construed  in accordance  with the internal laws of the State of California as such  laws  are applied  to  agreements  between  California  residents  entered  into  and  to  be performed entirely within California.  If any provision of this Exercise Agreement is determined by a court  of law to be illegal or unenforceable,  then such  provision  will be enforced  to the maximum extent possible and the other provisions will remain fully effective and enforceable.
31.    NOTICES.  Any notice required to be given or delivered to the Company shall be in writing and addressed to the Corporate Secretary of the Company at its principal corporate offices.    Any notice  required  to  be given or delivered  to  Purchaser  shall be  in  writing  and addressed to Purchaser at the address indicated above or to such other address as Purchaser may designate  in writing  from  time  to  time  to  the Company.    All  notices  shall be deemed effectively given upon personal delivery, (i) three (3) days after deposit in the United States mail by  certified  or  registered  mail  (return  receipt  requested), (ii) one  (1)  business  day  after  its deposit  with  any return  receipt  express  courier  (prepaid),  or (iii) one (1)  business  day  after transmission by rapifax or telecopier.
32.    FURTHER   INSTRUMENTS.      The  parties   agree  to   execute   such   further instruments  and to take such further action as may be reasonably necessary to carry out the purposes and intent of this Exercise Agreement.
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33.    HEADINGS.     The  captions   and  headings  of  this  Exercise  Agreement  are included  for ease of reference only and will be disregarded  in interpreting  or  construing  this Exercise Agreement.   All references herein to Sections  will refer to  Sections  of this Exercise Agreement.
34.    ENTIRE AGREEMENT.   The Plan, the Notice of Stock Option Grant, the Stock Option  Agreement and this Exercise Agreement, together  with all Exhibits thereto, constitute the entire agreement and understanding of the parties with respect to the subject matter of this Exercise Agreement, and supersede all prior understandings  and agreements, whether oral or written, between the parties hereto with respect to the specific subject matter hereof.
[REMAINDER  OF PAGE INTENTIONALLY LEFT BLANK]
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IN  WITNESS  WHEREOF,  the Company  has caused  this  Exercise  Agreement  to  be executed  in triplicate  by its duly authorized  representative  and Purchaser has  executed  this Exercise Agreement in triplicate as of the Effective Date, indicated above.
												
	NEXTDOOR.COM, INC.
		PURCHASER

				
	By:			
				(Signature)
				
			
	(Please print name)		(Please print name)
				
			
	(Please print title)		


[SIGNATURE  PAGE TO NEXTDOOR.COM,  INC. STOCK  OPTION  EXERCISE  AGREEMENT]







LIST OF EXHIBITS
Exhibit 1:    Stock Power and Assignment Separate from Stock Certificate
Exhibit 2:    Spouse Consent
Exhibit 3:    Copy of Purchaser’s Check









EXHIBIT 1
STOCK POWER AND ASSIGNMENT SEPARATE FROM STOCK CERTIFICATE








Stock Power And Assignment
Separate From Stock Certificate
FOR VALUE RECEIVED and pursuant to that certain Stock Option Exercise Agreement dated as of ________________,_____, (the “Agreement”), the undersigned hereby sells, assigns and  transfers  unto _______________________________, _______ shares  of  the  Common Stock,  $0.0001  par  value  per  share,  of  Nextdoor.com,  Inc.,  a  Delaware  corporation  (the “Company”), standing in the undersigned’s name on the books of the Company represented by Certificate  No(s).  _________ delivered herewith,  and does hereby irrevocably  constitute  and appoint the Secretary of the Company as the undersigned’s attorney-in-fact, with full power of substitution,  to transfer said stock  on the books of the Company.   THIS ASSIGNMENT MAY ONLY BE USED AS AUTHORIZED BY THE AGREEMENT AND ANY EXHIBITS THERETO.
												
	Dated:			
				
				PURCHASER
				
				(Signature)
				
				(Please Print Name)
				
				(Spouse’s Signature, if any)

				
				(Please Print Spouse’s Name)


Instructions to Purchaser:  Please do not fill in any blanks other than the signature line.  The purpose of this Stock Power and Assignment is to enable the Company to acquire the shares pursuant  to  “Right of  First  Refusal” set  forth  in the  Exercise  Agreement  without  requiring additional signatures on the part of the Purchaser or Purchaser’s Spouse.









EXHIBIT 2
SPOUSE CONSENT








Spouse Consent
The undersigned spouse of _______________ (the “Purchaser”) has read, understands, and  hereby  approves  the  Stock  Option  Exercise  Agreement  between  Purchaser  and  the Company (the “Agreement”).  In consideration  of the Company’s granting my spouse the right to purchase the Shares as set forth in the Agreement, the  undersigned  hereby agrees to be irrevocably bound by the Agreement and further agrees that any community  property interest I may have in the Shares shall similarly be bound by the Agreement.   The undersigned  hereby appoints  Purchaser as my attorney-in-fact with respect to any amendment or exercise of any rights under the Agreement.
												
	Dated:			
				
				Print Name of Purchaser’s Spouse
				
				Signature of Purchaser’s Spouse
				
		Address: