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EXHIBIT 10.14.2  


 
 

NUVASIVE, INC.
  STOCK ISSUANCE AGREEMENT    
    


        AGREEMENT made as of this    day
of                   , 2004, by and between NuVasive, Inc., a
Delaware corporation, and                        , Participant in the Corporation's 1998 Stock Option/Stock Issuance Plan.



        All
capitalized terms in this Agreement shall have the meaning assigned to them in this Agreement or in the attached Appendix. 


        A.    PURCHASE OF SHARES    



        1.    Purchase.    Participant hereby purchases            shares of Common Stock (the
"Purchased Shares") pursuant to the provisions of the Stock Issuance Program for services previously rendered valued at $4.30 per share (the "Purchase Price"). 


        2.    Payment.    Concurrently with the delivery of this Agreement to the Corporation,
Participant shall be deemed to have provided to the Corporation the Purchase Price for the Purchased Shares in the form of past services rendered to the Corporation. 



        3.    Stockholder Rights.    Until such time as the Corporation exercises the First Refusal
Right, Participant (or any successor in interest) shall have all stockholder rights (including voting, dividend and liquidation rights) with respect to the Purchased Shares, subject, however, to the
transfer restrictions of Articles B and C. 




        B.    SECURITIES LAW COMPLIANCE    



        1.    Restricted Securities.    The Purchased Shares have not been registered under the 1933
Act and are being issued to Participant in reliance upon the exemption from such registration provided by SEC Rule 701 for stock issuances under compensatory benefit plans such as the Plan.
Participant hereby confirms that Participant has been informed that the Purchased Shares are restricted securities under the 1933 Act and may not be resold or transferred unless the Purchased Shares
are first registered under the Federal securities laws or unless an exemption from such registration is available. Accordingly, Participant hereby acknowledges that Participant is prepared to hold the
Purchased Shares for an indefinite period and that Participant is aware that SEC Rule 144 issued under the 1933 Act which exempts certain resales of unrestricted securities is not presently
available to exempt the resale of the Purchased Shares from the registration requirements of the 1933 Act. 


        2.    Disposition of Purchased Shares.    Participant shall make no disposition of the
Purchased Shares (other than a Permitted Transfer) unless and until there is compliance with all of the following requirements: 



          (i)  Participant
shall have provided the Corporation with a written summary of the terms and conditions of the proposed disposition. 


         (ii)  Participant
shall have complied with all requirements of this Agreement applicable to the disposition of the Purchased Shares. 


        (iii)  Participant
shall have provided the Corporation with written assurances, in form and substance satisfactory to the Corporation, that (a) the proposed
disposition does not require registration of the Purchased Shares under the 1933 Act or (b) all appropriate action necessary for compliance with the registration requirements of the 1933 Act or
any exemption from registration available under the 1933 Act (including Rule 144) has been taken. 




        The
Corporation shall not be required (i) to transfer on its books any Purchased Shares which have been sold or transferred in
violation of the provisions of this Agreement or (ii) to treat as the owner of the Purchased Shares, or otherwise to accord voting, dividend or
liquidation rights to, any 








 

transferee
to whom the Purchased Shares have been transferred in contravention of this Agreement. 


        3.    Restrictive Legends.    The stock certificates for the Purchased Shares shall be
endorsed with one or more of the following restrictive legends: 



        "The
shares represented by this certificate have not been registered under the Securities Act of 1933. The shares may not be sold or offered for sale in the absence of (a) an
effective registration statement for the shares under such Act, (b) a "no action" letter of the Securities and Exchange Commission with respect to such sale or offer or (c) satisfactory
assurances to the Corporation that registration under such Act is not required with respect to such sale or offer." 


        "The
shares represented by this certificate are subject to certain rights of first refusal granted to the Corporation and accordingly may not be sold, assigned, transferred, encumbered,
or in any manner disposed of except in conformity with the terms of a written agreement dated                        , 2004
between the Corporation and the registered holder of the shares (or the predecessor
in interest to the shares). A copy of such agreement is maintained at the Corporation's principal corporate offices." 





        C.    TRANSFER RESTRICTIONS    



        1.    Restriction on Transfer.    Purchased Shares shall not be transferred, assigned,
encumbered or otherwise disposed of in contravention of the First Refusal Right or the Market Stand-Off. 



        2.    Transferee Obligations.    Each person (other than the Corporation) to whom the
Purchased Shares are transferred by means of a Permitted Transfer must, as a condition precedent to the validity of such transfer, acknowledge in writing to the Corporation that such person is bound
by the provisions of this Agreement and that the transferred shares are subject to (i) the First Refusal Right and (ii) the Market Stand-Off, to the same extent such shares
would be so subject if retained by Participant. 


        3.    Market Stand-Off.    



        (a)   In
connection with any underwritten public offering by the Corporation of its equity securities pursuant to an effective registration statement filed under the 1933 Act,
including the Corporation's initial public offering, Owner shall not sell, make any short sale of, loan, hypothecate, pledge, grant any option for the purchase of, or otherwise dispose or transfer for
value or otherwise agree to engage in any of the foregoing transactions with respect to, any Purchased Shares without the prior written consent of the Corporation or its underwriters. Such restriction
(the "Market Stand-Off") shall be in effect for such period of time from and after the effective date of the final prospectus for the offering as may be requested by the Corporation or
such underwriters. In no event, however, shall such period exceed one hundred eighty (180) days and the Market Stand-Off shall in all events terminate two (2) years after the
effective date of the Corporation's initial public offering. 


        (b)   Owner
shall be subject to the Market Stand-Off provided and only if the officers and directors of the
Corporation are also subject to similar restrictions. 


        (c)   Any
new, substituted or additional securities which are by reason of any Recapitalization or Reorganization distributed with respect to the Purchased Shares shall be
immediately subject to the Market Stand-Off, to the same extent the Purchased Shares are at such time covered by such provisions. 




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        (d)   In
order to enforce the Market Stand-Off, the Corporation may impose stop-transfer instructions with respect to the Purchased Shares until the
end of the applicable stand-off period. 





        D.    RIGHT OF FIRST REFUSAL    



        1.    Grant.    The Corporation is hereby granted the right of first refusal (the "First
Refusal Right"), exercisable in connection with any proposed transfer of the Purchased Shares. For purposes of this Article D, the term "transfer" shall include any sale, assignment, pledge,
encumbrance or other disposition of the Purchased Shares intended to be made by Owner, but shall not include any Permitted Transfer. 



        2.    Notice of Intended Disposition.    In the event any Owner of Purchased Shares in which
Participant has vested desires to accept a bona fide third-party offer for the transfer of any or all of such shares (the Purchased Shares subject to such offer to be hereinafter referred to as the
"Target Shares"), Owner shall promptly (i) deliver to the Corporation written notice (the "Disposition Notice") of the terms of the offer, including the purchase price and the identity of the
third-party offeror, and (ii) provide satisfactory proof that the disposition of the Target Shares to such third-party offeror would not be in contravention of the provisions set forth in
Articles B and C. 


        3.    Exercise of the First Refusal Right.    The Corporation shall, for a period of
twenty-five (25) days following receipt of the Disposition Notice, have the right to repurchase any or all of the Target Shares subject to the Disposition Notice upon the same terms
as those specified therein or upon such other terms (not materially different from those specified in the Disposition Notice) to which Owner consents. Such right shall be exercisable by delivery of
written notice (the "Exercise Notice") to Owner prior to the expiration of the twenty-five (25)-day exercise period. If such right is exercised with respect to all the Target
Shares, then the Corporation shall effect the repurchase of such shares, including payment of the purchase price, not more than five (5) business days
after delivery of the Exercise Notice; and at such time the certificates representing the Target Shares shall be delivered to the Corporation. 


        Should
the purchase price specified in the Disposition Notice be payable in property other than cash or evidences of indebtedness, the Corporation shall have the right to pay the
purchase price in the form of cash equal in amount to the value of such property. If Owner and the Corporation cannot agree on such cash value within ten (10) days after the Corporation's
receipt of the Disposition Notice, the valuation shall be made by an appraiser of recognized standing selected by Owner and the Corporation or, if they cannot agree on an appraiser within twenty
(20) days after the Corporation's receipt of the Disposition Notice, each shall select an appraiser of recognized standing and the two (2) appraisers shall designate a third appraiser of
recognized standing, whose appraisal shall be determinative of such value. The cost of such appraisal shall be shared equally by Owner and the Corporation. The closing shall then be held on the  later of
(i) the fifth (5th) business day following delivery of the Exercise Notice or (ii) the fifth (5th) business day after such
valuation shall have been made. 


        4.    Non-Exercise of the First Refusal Right.    In the event the Exercise Notice
is not given to Owner prior to the expiration of the twenty-five (25)-day exercise period, Owner shall have a period of thirty (30) days thereafter in which to sell or
otherwise dispose of the Target Shares to the third-party offeror identified in the Disposition Notice upon terms (including the purchase price) no more favorable to such third-party offeror than
those specified in the Disposition Notice; provided, however, that any such sale or disposition must not be effected in contravention of the provisions
of Articles B and C. The third-party offeror shall acquire the Target Shares subject to the First Refusal Right and the provisions and restrictions of Article B and Paragraph C.3, and
any subsequent disposition of the acquired shares must be effected in compliance with the terms and 



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conditions
of such First Refusal Right and the provisions of Article B and Paragraph C.3. In the event Owner does not effect such sale or disposition of the Target Shares within the
specified thirty (30)-day period, the First Refusal Right shall continue to be applicable to any subsequent disposition of the Target Shares by Owner until such right lapses. 



        5.    Partial Exercise of the First Refusal Right.    In the event the Corporation makes a
timely exercise of the First Refusal Right with respect to a portion, but not all, of the Target Shares specified in the Disposition Notice, Owner shall have the option, exercisable by written notice
to the Corporation delivered within five (5) business days after Owner's receipt of the Exercise Notice, to effect the sale of the Target Shares pursuant to either of the following
alternatives: 



          (i)  sale
or other disposition of all the Target Shares to the third-party offeror identified in the Disposition Notice, but in full compliance with the requirements of
Paragraph D.4, as if the Corporation did not exercise the First Refusal Right; or 


         (ii)  sale
to the Corporation of the portion of the Target Shares which the Corporation has elected to purchase, such sale to be effected in substantial conformity with the
provisions of Paragraph D.3. The First Refusal Right shall continue to be applicable to any subsequent disposition of the remaining Target Shares until such right lapses. 




        Owner's
failure to deliver timely notification to the Corporation shall be deemed to be an election by Owner to sell the Target Shares pursuant to alternative (i) above. 


        6.    Recapitalization/Reorganization.    



        (a)   Any
new, substituted or additional securities or other property which is by reason of any Recapitalization distributed with respect to the Purchased Shares shall be
immediately subject to the First Refusal Right, but only to the extent the Purchased Shares are at the time covered by such right. 



        (b)   In
the event of a Reorganization, the First Refusal Right shall remain in full force and effect and shall apply to the new capital stock or other property received in
exchange for the Purchased Shares in consummation of the Reorganization, but only to the extent the Purchased Shares are at the time covered by such right. 




        7.    Lapse.    The First Refusal Right shall lapse upon the  earliest to occur of (i) the first date on which shares
of the Common Stock are held of record by more than five hundred (500) persons,
(ii) a determination made by the Board that a public market exists for the outstanding shares of Common Stock or (iii) a firm commitment underwritten public offering, pursuant to an
effective registration statement under the 1933 Act, covering the offer and sale of the Common Stock in the aggregate amount of at least ten million dollars ($10,000,000). However, the Market
Stand-Off shall continue to remain in full force and effect following the lapse of the First Refusal Right. 




        E.    GENERAL PROVISIONS    



        1.    Assignment.    The Corporation may assign the First Refusal Right to any person or
entity selected by the Board, including (without limitation) one or more stockholders of the Corporation. 


        2.    No Employment or Service Contract.    Nothing in this Agreement or in the Plan shall
confer upon Participant any right to continue in Service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Corporation (or any Parent or
Subsidiary employing or retaining Participant) or of Participant, which rights are hereby expressly reserved by each, to terminate Participant's Service at any time for any reason, with or without
cause. 


        3.    Notices.    Any notice required to be given under this Agreement shall be in writing and
shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, registered or 



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certified,
postage prepaid and properly addressed to the party entitled to such notice at the address indicated below such party's signature line on this Agreement or at such other address as such
party may designate by ten (10) days advance written notice under this paragraph to all other parties to this Agreement. 


        4.    No Waiver.    The failure of the Corporation in any instance to exercise the First
Refusal Right shall not constitute a waiver of any other rights of first refusal that may subsequently arise under the provisions of this Agreement or any other agreement between the Corporation and
Participant. No waiver of any breach or condition of this Agreement shall be deemed to be a waiver of any other or subsequent breach or condition, whether of like or different nature. 


        5.    Cancellation of Shares.    If the Corporation shall make available, at the time and
place and in the amount and form provided in this Agreement, the consideration for the Purchased Shares to be repurchased in accordance with the provisions of this Agreement, then from and after such
time, the person from whom such shares are to be repurchased shall no longer have any rights as a holder of such shares (other than the right to receive payment of such consideration in accordance
with this Agreement). Such shares shall be deemed purchased in accordance with the applicable provisions hereof, and the Corporation shall be deemed the owner and holder of such shares, whether or not
the certificates therefor have been delivered as required by this Agreement. 




        F.    MISCELLANEOUS PROVISIONS    



        1.    Governing Law.    This Agreement shall be governed by, and construed in accordance with,
the laws of the State of California without resort to that State's conflict-of-laws rules. 


        2.    Participant Undertaking.    Participant hereby agrees to take whatever additional action
and execute whatever additional documents the Corporation may deem necessary or advisable in order to carry out or effect one or more of the obligations or restrictions imposed on either Participant
or the Purchased Shares pursuant to the provisions of this Agreement. 



        3.    Agreement is Entire Contract.    This Agreement constitutes the entire contract between
the parties hereto with regard to the subject matter hereof. This Agreement is made pursuant to the provisions of the Plan and shall in all respects be construed in conformity with the terms of the
Plan. 


        4.    Counterparts.    This Agreement may be executed in counterparts, each of which shall be
deemed to be an original, but all of which together shall constitute one and the same instrument. 



        5.    Successors and Assigns.    The provisions of this Agreement shall inure to the benefit
of, and be binding upon, the Corporation and its successors and assigns and upon Participant, Participant's assigns and the legal representatives, heirs and legatees of Participant's estate, whether
or not any such person shall have become a party to this Agreement and have agreed in writing to join herein and be bound by the terms hereof. 


        6.    Tax Implications.    Participant understands that the fair value of the shares received
pursuant to this Agreement, as determined by the Corporation's board of directors, will be reportable as ordinary income and be subject to withholding on the same basis as compensation paid in cash.
PARTICIPANT ACKNOWLEDGES THAT THE CORPORATION HAS NOT PROVIDED TAX OR OTHER ADVICE WITH REGARD TO ANY TAX ISSUES, AND THAT PARTICIPANT IS NOT RELYING ON THE CORPORATION FOR ANY SUCH ADVICE IN
CONNECTION WITH THE PURCHASE OF THE PURCHASED SHARES. 



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        IN WITNESS WHEREOF, the parties have executed this Agreement on the day and year first indicated above. 



	 	 	NUVASIVE, INC.
	

 	
 	

By:	
 	

 
	 	 	 	 	

	 	 	Title:	 	 
	 	 	 	 	

	 	 	Address:	 	10065 Old Grove Road

San Diego, CA 92131
	

 	
 	

 [PARTICIPANT]
	

 	
 	

Address:	
 	

 
	 	 	 	 	

	

 	
 	

 	
 	











SPOUSAL ACKNOWLEDGMENT  


        The undersigned spouse of Participant has read and hereby approves the foregoing Stock Issuance Agreement. In consideration of the Corporation's granting
Participant the right to acquire the Purchased Shares in accordance with the terms of such Agreement, the undersigned hereby agrees to be irrevocably bound by all the terms of such Agreement. 



	 	 	PARTICIPANT'S SPOUSE
	

 	
 	

Address:	
 	

 
	 	 	 	 	

	

 	
 	











EXHIBIT I  


 1998 STOCK OPTION/STOCK ISSUANCE PLAN  








   APPENDIX  


        The following definitions shall be in effect under the Agreement: 


        A.    Agreement shall mean this Stock Issuance Agreement. 


        B.    Board shall mean the Corporation's Board of Directors. 


        C.    Code shall mean the Internal Revenue Code of 1986, as amended. 


        D.    Common Stock shall mean the Corporation's common stock. 



        E.    Corporate Transaction shall mean either of the following stockholder-approved transactions: 



          (i)  a
merger or consolidation in which securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation's outstanding securities
are transferred to a person or persons different from the persons holding those securities immediately prior to such transaction, or 



         (ii)  the
sale, transfer or other disposition of all or substantially all of the Corporation's assets in complete liquidation or dissolution of the Corporation. 




        F.     Corporation shall mean NuVasive, Inc., a Delaware corporation. 


        G.    Disposition Notice shall have the meaning assigned to such term in Paragraph D.2. 



        H.    Exercise Notice shall have the meaning assigned to such term in Paragraph D.3. 


        I.     Fair Market Value of a share of Common Stock on any relevant date, prior to the initial public offering of the Common
Stock, shall be determined by the Plan Administrator after taking into account such factors as it shall deem appropriate. 


        J.     First Refusal Right shall mean the right granted to the Corporation in accordance with Article D. 



        K.    Market Stand-Off shall mean the market stand-off restriction specified in Paragraph C.3. 


        L.    1933 Act shall mean the Securities Act of 1933, as amended. 


        M.   Owner shall mean Participant and all subsequent holders of the Purchased Shares who derive their chain of ownership
through a Permitted Transfer from Participant. 


        N.    Parent shall mean any corporation (other than the Corporation) in an unbroken chain of corporations ending with the
Corporation, provided each corporation in the unbroken chain (other than the Corporation) owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total combined
voting power of all classes of stock in one of the other corporations in such chain. 


        O.    Participant shall mean the person to whom shares are issued under the Stock Issuance Program. 



        P.     Permitted Transfer shall mean (i) a gratuitous transfer of the Purchased Shares, provided
and only if Participant obtains the Corporation's prior written consent to such transfer, (ii) a transfer of title to the Purchased Shares effected pursuant to
Participant's will or the laws of intestate succession following Participant's death or (iii) a transfer to the Corporation in pledge as security for any purchase-money indebtedness incurred by
Participant in connection with the acquisition of the Purchased Shares. 



        Q.    Plan shall mean the Corporation's 1998 Stock Option/Stock Issuance Plan attached hereto as Exhibit III. 


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        R.    Plan Administrator shall mean either the Board or a committee of the Board acting in its capacity as administrator of the
Plan. 


        S.     Purchase Price shall have the meaning assigned to such term in Paragraph A.1. 


        T.     Purchased Shares shall have the meaning assigned to such term in Paragraph A.1. 


        U.    Recapitalization shall mean any stock split, stock dividend, recapitalization, combination of shares, exchange of shares
or other change affecting the Corporation's outstanding Common Stock as a class without the Corporation's receipt of consideration. 



        V.     Reorganization shall mean any of the following transactions: 



          (i)  a
merger or consolidation in which the Corporation is not the surviving entity, 


         (ii)  a
sale, transfer or other disposition of all or substantially all of the Corporation's assets, 


        (iii)  a
reverse merger in which the Corporation is the surviving entity but in which the Corporation's outstanding voting securities are transferred in whole or in part to a
person or persons different from the persons holding those securities immediately prior to the merger, or 


        (iv)  any
transaction effected primarily to change the state in which the Corporation is incorporated or to create a holding company structure. 




        W.    SEC shall mean the Securities and Exchange Commission. 



        X.    Service shall mean the Participant's performance of services for the Corporation (or any Parent or Subsidiary) in the
capacity of an employee, subject to the control and direction of the employer entity as to both the work to be performed and the manner and method of performance, a non-employee member of
the board of directors or an independent consultant. 


        Y.    Stock Issuance Program shall mean the Stock Issuance Program under the Plan. 



        Z.    Subsidiary shall mean any corporation (other than the Corporation) in an unbroken chain of corporations beginning with the
Corporation, provided each corporation (other than the last corporation) in the unbroken chain owns, at the time of the determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations in such chain. 


        AA. Target Shares shall have the meaning assigned to such term in Paragraph D.2. 


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NUVASIVE, INC. STOCK ISSUANCE AGREEMENT