exv10w16



 




Exhibit
10.16


AMALGAMATED TECHNOLOGIES, INC.

NON-QUALIFIED STOCK OPTION AGREEMENT




     AGREEMENT made as of the «Agreement_Date», between Amalgamated Technologies, Inc. (the
“Company”), a Delaware corporation having a principal place of business in                                         , and
«First» «Last» (the “Participant”).



     WHEREAS, the Company desires to grant to the Participant an Option to purchase shares of its
common stock, $0.0001 par value per share (the “Shares”), under and for the purposes set forth in
the Company’s 2005 Employee, Director and Consultant Stock Plan (the “Plan”);



     WHEREAS, the Company and the Participant understand and agree that any terms used and not
defined herein have the same meanings as in the Plan; and



     WHEREAS, the Company and the Participant each intend that the Option granted herein shall be a
Non-Qualified Option.



     NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth and for other
good and valuable consideration, the parties hereto agree as follows:



     1. GRANT OF OPTION.



     The Company hereby grants to the Participant the right and option to purchase all or any part
of an aggregate of «Options» Shares, on the terms and conditions and subject to all the limitations
set forth herein, under United States securities and tax laws, and in the Plan, which is
incorporated herein by reference. The Participant acknowledges receipt of a copy of the Plan.



     2. PURCHASE PRICE.



     The purchase price of the Shares covered by the Option shall be $«Price_» per Share, subject
to adjustment, as provided in the Plan, in the event of a stock split, reverse stock split or other
events affecting the holders of Shares after the date hereof (the “Purchase Price”). Payment shall
be made in accordance with Paragraph 9 of the Plan.



     3. EXERCISABILITY OF OPTION.



     Subject to the terms and conditions set forth in this Agreement and the Plan, the Option
granted hereby shall become exercisable as follows:




[Insert Vesting Schedule]



     The foregoing rights are cumulative and are subject to the other terms and conditions of this
Agreement and the Plan.



 









 





     4. TERM OF OPTION.



     The Option shall terminate ten years from the date of this Agreement, but shall be subject to
earlier termination as provided herein or in the Plan.



     If the Participant ceases to be an employee, director or consultant of the Company or of an
Affiliate (for any reason other than the death or Disability of the Participant or termination of
the Participant for “cause” (as defined in the Plan), the Option may be exercised, if it has not
previously terminated, within three months after the date the Participant ceases to be an employee,
director or consultant of the Company or an Affiliate, or within the originally prescribed term of
the Option, whichever is earlier, but may not be exercised thereafter. In such event, the Option
shall be exercisable only to the extent that the Option has become exercisable and is in effect at
the date of such cessation of service.



     Notwithstanding the foregoing, in the event of the Participant’s Disability or death within
three months after the termination of service, the Participant or the Participant’s Survivors may
exercise the Option within one year after the date of the Participant’s termination of service, but
in no event after the date of expiration of the term of the Option.



     In the event the Participant’s service is terminated by the Company or an Affiliate for
“cause” (as defined in the Plan), the Participant’s right to exercise any unexercised portion of
this Option shall cease immediately as of the time the Participant is notified his or her service
is terminated for “cause”, and this Option shall thereupon terminate. Notwithstanding anything
herein to the contrary, if subsequent to the Participant’s termination, but prior to the exercise
of the Option, the Board of Directors of the Company determines that, either prior or subsequent to
the Participant’s termination, the Participant engaged in conduct which would constitute “cause,”
then the Participant shall immediately cease to have any right to exercise the Option and this
Option shall thereupon terminate.



     In the event of the Disability of the Participant, as determined in accordance with the Plan,
the Option shall be exercisable within one year after the Participant’s termination of service or,
if earlier, within the term originally prescribed by the Option. In such event, the Option shall
be exercisable:




	 	(a)	 	to the extent that the Option has become exercisable but has not been exercised
as of the date of Disability; and
	 
	 	(b)	 	in the event rights to exercise the Option accrue periodically, to the extent
of a pro rata portion through the date of Disability of any additional vesting rights
that would have accrued on the next vesting date had the Participant not become
Disabled. The proration shall be based upon the number of days accrued in the current
vesting period prior to the date of Disability.





     In the event of the death of the Participant while an employee, director or consultant of the
Company or of an Affiliate, the Option shall be exercisable by the Participant’s Survivors



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within
one year after the date of death of the Participant or, if earlier, within the originally
prescribed term of the Option. In such event, the Option shall be exercisable:





	 	(x)	 	to the extent that the Option has become exercisable but has not been exercised
as of the date of death; and
	 
	 	(y)	 	in the event rights to exercise the Option accrue periodically, to the extent
of a pro rata portion through the date of death of any additional vesting rights that
would have accrued on the next vesting date had the Participant not died. The
proration shall be based upon the number of days accrued in the current vesting period
prior to the Participant’s date of death.





     5. METHOD OF EXERCISING OPTION.



     Subject to the terms and conditions of this Agreement, the Option may be exercised by written
notice to the Company or its designee, in substantially the form of Exhibit A attached
hereto. Such notice shall state the number of Shares with respect to which the Option is being
exercised and shall be signed by the person exercising the Option. Payment of the purchase price
for such Shares shall be made in accordance with Paragraph 9 of the Plan. The Company shall
deliver such Shares as soon as practicable after the notice shall be received, provided, however,
that the Company may delay issuance of such Shares until completion of any action or obtaining of
any consent, which the Company deems necessary under any applicable law (including, without
limitation, state securities or “blue sky” laws). The Shares as to which the Option shall have
been so exercised shall be registered in the Company’s share register in the name of the person so
exercising the Option (or, if the Option shall be exercised by the Participant and if the
Participant shall so request in the notice exercising the Option, shall be registered in the name
of the Participant and another person jointly, with right of survivorship) and shall be delivered
as provided above to or upon the written order of the person exercising the Option. In the event
the Option shall be exercised, pursuant to Section 4 hereof, by any person other than the
Participant, such notice shall be accompanied by appropriate proof of the right of such person to
exercise the Option. All Shares that shall be purchased upon the exercise of the Option as
provided herein shall be fully paid and nonassessable.



     6. PARTIAL EXERCISE.



     Exercise of this Option to the extent above stated may be made in part at any time and from
time to time within the above limits, except that no fractional share shall be issued pursuant to
this Option.



     7. NON-ASSIGNABILITY.



     The Option shall not be transferable by the Participant otherwise than by will or by the laws
of descent and distribution or pursuant to a qualified domestic relations order as defined by the
Code or Title I of the Employee Retirement Income Security Act or the rules thereunder. However,
the Participant, with the approval of the Administrator, may transfer the Option for no
consideration to or for the benefit of the Participant’s Immediate Family (including, without



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limitation, to a trust for the benefit of the Participant’s Immediate Family or to a partnership or
limited liability company for one or more members of the Participant’s Immediate Family), subject
to such limits as the Administrator may establish, and the transferee shall remain subject to all
the terms and conditions applicable to the Option prior to such transfer and each such transferee
shall so acknowledge in writing as a condition precedent to the effectiveness of such transfer.
The term “Immediate Family” shall mean the Participant’s spouse, former spouse, parents, children,
stepchildren, adoptive relationships, sisters, brothers, nieces, nephews and grandchildren (and,
for this purpose, shall also include the Participant.) Except as provided in the previous
sentence, the Option shall be exercisable, during the Participant’s lifetime, only by the
Participant (or, in the event of legal incapacity or incompetency, by the Participant’s guardian or
representative) and shall not be assigned, pledged or hypothecated in any way (whether by operation
of law or otherwise) and shall not be subject to execution, attachment or similar process. Any
attempted transfer, assignment, pledge, hypothecation or other disposition of the Option or of any
rights granted hereunder contrary to the provisions of this Section 7, or the levy of any
attachment or similar process upon the Option shall be null and void.



     8. NO RIGHTS AS STOCKHOLDER UNTIL EXERCISE.



     The Participant shall have no rights as a stockholder with respect to Shares subject to this
Agreement until registration of the Shares in the name of the Participant. Except as is expressly
provided in the Plan with respect to certain changes in the capitalization of the Company, no
adjustment shall be made for dividends or similar rights for which the record date is prior to the
date of such registration.



     9. ADJUSTMENTS.



     The Plan contains provisions covering the treatment of Options in a number of contingencies
such as stock splits and mergers. Provisions in the Plan for adjustment with respect to stock
subject to Options and the related provisions with respect to successors to the business of the
Company are hereby made applicable hereunder and are incorporated herein by reference.



     10. TAXES.



     The Participant acknowledges that upon exercise of the Option the Participant will be deemed
to have taxable income measured by the difference between the then fair market value of the Shares
received upon exercise and the price paid for such Shares pursuant to this Agreement. The
Participant acknowledges that any income or other taxes due from him or her with respect to this
Option or the Shares issuable pursuant to this Option shall be the Participant’s responsibility.



     The Participant agrees that the Company may withhold from the Participant’s remuneration, if
any, the minimum statutory amount of federal, state and local withholding taxes attributable to
such amount that is considered compensation includable in such person’s gross income. At the
Company’s discretion, the amount required to be withheld may be withheld in cash from such
remuneration, or in kind from the Shares otherwise deliverable to the Participant on exercise of
the Option. The Participant further agrees that, if the Company does not withhold



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an amount from
the Participant’s remuneration sufficient to satisfy the Company’s income tax withholding
obligation, the Participant will reimburse the Company on demand, in cash, for the amount
under-withheld.



     11. PURCHASE FOR INVESTMENT.



     Unless the offering and sale of the Shares to be issued upon the particular exercise of the
Option shall have been effectively registered under the Securities Act of 1933, as now in force or
hereafter amended (the “1933 Act”), the Company shall be under no obligation to issue the Shares
covered by such exercise unless and until the following conditions have been fulfilled:




	 	(a)	 	The person(s) who exercise the Option shall warrant to the Company, at the time
of such exercise, that such person(s) are acquiring such Shares for their own
respective accounts, for investment, and not with a view to, or for sale in connection
with, the distribution of any such Shares, in which event the person(s) acquiring such Shares shall be bound by the provisions of the following legend which shall be endorsed
upon the certificate(s) evidencing the Shares issued pursuant to such exercise:






“The shares represented by this certificate have been taken for investment
and they may not be sold or otherwise transferred by any person, including a
pledgee, unless (1) either (a) a Registration Statement with respect to such
shares shall be effective under the Securities Act of 1933, as amended, or
(b) the Company shall have received an opinion of counsel satisfactory to it
that an exemption from registration under such Act is then available, and
(2) there shall have been compliance with all applicable state securities
laws;” and




	 	(b)	 	If the Company so requires, the Company shall have received an opinion of its
counsel that the Shares may be issued upon such particular exercise in compliance with
the 1933 Act without registration thereunder. Without limiting the generality of the
foregoing, the Company may delay issuance of the Shares until completion of any action
or obtaining of any consent, which the Company deems necessary under any applicable law
(including without limitation state securities or “blue sky” laws).





     12. RESTRICTIONS ON TRANSFER OF SHARES.



     12.1 If, in connection with a registration statement filed by the Company pursuant to the 1933
Act, the Company or its underwriter so requests, the Participant will agree not to sell any Shares
for a period not to exceed 180 days following the effectiveness of such registration statement or
such longer period as is necessary to comply with NASD Section 2711(f)(4) or such other similar
rules or regulations as in effect at such time.



     12.2 The Participant acknowledges and agrees that neither the Company, its shareholders nor
its directors and officers, has any duty or obligation to disclose to the



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Participant any material
information regarding the business of the Company or affecting the value of the Shares before, at
the time of, or following a termination of the employment of the Participant by the Company,
including, without limitation, any information concerning plans for the Company to make a public
offering of its securities or to be acquired by or merged with or into another firm or entity.



     13. NO OBLIGATION TO MAINTAIN RELATIONSHIP.



     The Company is not by the Plan or this Option obligated to continue the Participant as an
employee, director or consultant of the Company or an Affiliate. The Participant acknowledges:
(i) that the Plan is discretionary in nature and may be suspended or terminated by the Company at
any time; (ii) that the grant of the Option is a one-time benefit which does not create any
contractual or other right to receive future grants of options, or benefits in lieu of options;
(iii) that all determinations with respect to any such future grants, including, but not limited
to, the times when options shall be granted, the number of shares subject to each option, the
option price, and the time or times when each option shall be exercisable, will be at the sole
discretion of the Company; (iv) that the Participant’s participation in the Plan is voluntary; (v)
that the value of the Option is an extraordinary item of compensation which is outside the scope of
the Participant’s employment contract, if any; and (vi) that the Option is not part of normal or
expected compensation for purposes of calculating any severance, resignation, redundancy, end of
service payments, bonuses, long-service awards, pension or retirement benefits or similar payments.



     14. NOTICES.



     Any notices required or permitted by the terms of this Agreement or the Plan shall be given by
recognized courier service, facsimile, registered or certified mail, return receipt requested,
addressed as follows:



If to the Company:




	 	 	 	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	If to the Participant:
	 	 	 	 
	 

	 	«First»
«Last»	 	 
	 

	 	«Address»	 	 
	 

	 	«City»,
«State» «Zip»	 	 





or to such other address or addresses of which notice in the same manner has previously been given.
Any such notice shall be deemed to have been given upon the earlier of receipt, one business day
following delivery to a recognized courier service or three business days following mailing by
registered or certified mail.




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     15. GOVERNING LAW.



     This Agreement shall be construed and enforced in accordance with the law of the State of
Delaware, without giving effect to the conflict of law principles thereof.



     16. BENEFIT OF AGREEMENT.



     Subject to the provisions of the Plan and the other provisions hereof, this Agreement shall be
for the benefit of and shall be binding upon the heirs, executors, administrators, successors and
assigns of the parties hereto.



     17. ENTIRE AGREEMENT.



     This Agreement, together with the Plan, embodies the entire agreement and understanding
between the parties hereto with respect to the subject matter hereof and supersedes all prior oral
or written agreements and understandings relating to the subject matter hereof. No statement,
representation, warranty, covenant or agreement not expressly set forth in this Agreement shall
affect or be used to interpret, change or restrict, the express terms and provisions of this
Agreement, provided, however, in any event, this Agreement shall be subject to and governed by the
Plan.



     18. MODIFICATIONS AND AMENDMENTS.



     The terms and provisions of this Agreement may be modified or amended as provided in the Plan.



     19. WAIVERS AND CONSENTS.



     Except as provided in the Plan, the terms and provisions of this Agreement may be waived, or
consent for the departure therefrom granted, only by written document executed by the party
entitled to the benefits of such terms or provisions. No such waiver or consent shall be deemed to
be or shall constitute a waiver or consent with respect to any other terms or provisions of this
Agreement, whether or not similar. Each such waiver or consent shall be effective only in the
specific instance and for the purpose for which it was given, and shall not constitute a continuing
waiver or consent.



     20. DATA PRIVACY.



     By entering into this Agreement, the Participant: (i) authorizes the Company and each
Affiliate, and any agent of the Company or any Affiliate administering the Plan or providing Plan
record keeping services, to disclose to the Company or any of its Affiliates such information and
data as the Company or any such Affiliate shall request in order to facilitate the grant of options
and the administration of the Plan; (ii) waives any data privacy rights he or she may have with
respect to such information; and (iii) authorizes the Company and each Affiliate to store and
transmit such information in electronic form.



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     IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its duly
authorized officer, and the Participant has hereunto set his or her hand, all as of the day
and year first above written.



	 	 	 	 	 	 	 
	 	 	AMALGAMATED TECHNOLOGIES, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

   Name: «Signer»
	 	 
	 

	 	 	 	   Title: «Title»	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	 
	 	 	   «First» «Last»	 	 






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Exhibit A




IMPORTANT NOTICE: This form of Notice of Exercise may only be used at such time as the Company has
filed a Registration Statement with the Securities and Exchange Commission under which the issuance
of the Shares for which this exercise is being made is registered and such Registration Statement
remains effective.



NOTICE OF EXERCISE OF NON-QUALIFIED STOCK OPTION




TO: AMALGAMATED TECHNOLOGIES, INC.




Ladies and Gentlemen:




     I hereby exercise my Non-Qualified Stock Option to purchase                     shares (the “Shares”) of
the common stock, $0.0001 par value, of Amalgamated Technologies, Inc. (the “Company”), at the
exercise price of $                     per share, pursuant to and subject to the terms of that certain
Non-Qualified Stock Option Agreement between the undersigned and the Company dated                                         ,
200_.



     I understand the nature of the investment I am making and the financial risks thereof. I am
aware that it is my responsibility to have consulted with competent tax and legal advisors about
the relevant national, state and local income tax and securities laws affecting the exercise of the
Option and the purchase and subsequent sale of the Shares.



     I am paying the option exercise price for the Shares as follows:



 







	 	 	Please issue the Shares (check one):
	 
	 	 	o to me; or






	 	 	o to me and                                                             , as joint tenants with right of
survivorship,





     at the following address:



 




	 	 	 	 	 
	 

	 	 

	 	 
	 

	 	 

	 	 
	 

	 	 

	 	 






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             My mailing address for shareholder communications, if different from the address listed above,
is:




	 	 	 	 	 
	 

	 	 

	 	 
	 

	 	 

	 	 
	 

	 	 

	 	 






	 	 	 	 	 
	 

	 	Very truly yours,	 	 
	 
	 	 	 	 
	 

	 	 

Participant (signature)
	 	 
	 
	 	 	 	 
	 

	 	 

Print Name
	 	 
	 
	 	 	 	 
	 

	 	 

Date
	 	 
	 
	 	 	 	 
	 

	 	 

Social Security Number
	 	 






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