Document:

Exhibit

ACACIA RESEARCH CORPORATION 
STOCK OPTION AGREEMENT
r e c i t a l s:
A.    The Board has adopted the 2016 Acacia Research Corporation Stock Incentive Plan (the “Plan”) (i) to enhance the Corporation’s ability to attract and retain the services of qualified employees, officers, directors, consultants and other service providers upon whose judgment, initiative and efforts the successful conduct and development of the Corporation’s business largely depends, and (ii) to provide additional incentives to such persons or entities to devote their utmost effort and skill to the advancement and betterment of the Corporation, by providing them an opportunity to participate in the ownership of the Corporation and thereby have an interest in the success and increased value of the Corporation.
B.    Optionee is to render valuable services to the Corporation (or a Parent or Subsidiary), and this Stock Option Agreement (the “Agreement”) is executed pursuant to, and is intended to carry out the purposes of, the Plan in connection with the Corporation's grant of an option to Optionee.
C.    All capitalized terms but not defined in this Agreement shall have the meanings assigned to them in the Appendix attached to the Plan.
NOW, THEREFORE, it is hereby agreed as follows:
GRANT OF OPTION. The Corporation hereby grants to Optionee, as of the date of grant of the options (the “Grant Date”) as specified in the Notice of Grant of Stock Option (the “Grant Notice”), an option to purchase up to the number of shares of Common Stock subject to the option as specified in the Grant Notice (the “Option Shares”) specified in the Grant Notice. The Option Shares shall be purchasable from time to time during the option term specified in Paragraph 2 hereof at the exercise price per Option Share as specified in the Grant Notice (the “Exercise Price”).
OPTION TERM. This option shall have a maximum term of seven (7) years2 measured from the Grant Date and shall accordingly expire at the close of business on the expiration date specified in the Grant Notice (the “Expiration Date”), unless sooner terminated in accordance with Paragraph 5 or 6 hereof.
LIMITED TRANSFERABILITY. This option shall be neither transferable nor assignable by Optionee other than by will or by the laws of descent and distribution following Optionee's death and may be exercised, during Optionee's lifetime, only by Optionee. However, if this option is designated a Non-Statutory Option in the Grant Notice, then this option may be assigned in whole or in part during Optionee's lifetime to one or more members of the Optionee's Immediate Family or to a trust established for the exclusive benefit of Optionee or one or more members of the Optionee's Immediate Family or to the Optionee's former spouse, to the extent such assignment is in connection with Optionee's estate plan or pursuant to a domestic relations order.  The assigned portion shall be exercisable only by the person or persons who acquire a proprietary interest in the option pursuant to such assignment. The terms applicable to the assigned portion shall be the same as those in effect for this option immediately prior to such assignment.  Notwithstanding the 

foregoing, the Optionee may also designate one or more persons as the beneficiary or beneficiaries of this option and this option shall, in accordance with such designation,
2 NTD:  Option to expire on date set forth in grant notice.  Cannot exceed 10 years.
automatically be transferred to such beneficiary or beneficiaries upon the Optionee's death while holding this option.  Such beneficiary or beneficiaries shall take the transferred option subject to all the terms and conditions of this Agreement, including (without limitation) the limited time period during which the option may be exercised following the Optionee's death.
DATES OF EXERCISE. This option shall become exercisable for the Option Shares in one or more installments as specified in the Grant Notice. As the option becomes exercisable for such installments, those installments shall accumulate, and the option shall remain exercisable for the accumulated installments until the Expiration Date or sooner termination of the option term under Paragraph 5 or 6 hereof.
CESSATION OF SERVICE. The option term specified in Paragraph 2 hereof shall terminate (and this option shall cease to be outstanding) prior to the Expiration Date should any of the following provisions become applicable:
		
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	Should Optionee cease to remain in Service for any reason (other than death, Permanent Disability, Voluntary Termination, which shall mean Optionee terminates employment voluntarily, or Misconduct) while this option is outstanding, then Optionee shall have a period of six (6) months (commencing with the date of such cessation of Service) during which to exercise this option, but in no event shall this option be exercisable at any time after the Expiration Date.

		
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	Should Optionee voluntarily terminate Service while this option is outstanding, then Optionee shall have a period of three (3) months (commencing with the date of such Voluntary Termination) during which to exercise this option, but in no event shall this option be exercisable at any time after the Expiration Date.

		
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	Should Optionee die while this option is outstanding, then the personal representative of Optionee's estate or the person or persons to whom the option is transferred pursuant to Optionee's will or in accordance with the laws of descent and distribution or any person or trust to whom all or a portion of this option is transferred in accordance with Paragraph 3 hereof or the designated beneficiary or beneficiaries of this option shall have the right to exercise this option. Such right shall lapse, and this option shall cease to be outstanding, upon the earlier of (i) the expiration of the twelve (12)-month period measured from the date of Optionee's death or (ii) the Expiration Date.

		
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	Should Optionee cease Service by reason of Permanent Disability while this option is outstanding, then Optionee shall have a period of twelve (12) months (commencing with the date of such cessation of Service) during which to exercise this option. In no event shall this option be exercisable at any time after the Expiration Date.

During the limited period of post-Service exercisability, this option may not be exercised in the aggregate for more than the number of vested Option Shares for which the option is exercisable at the time of Optionee's cessation of Service. Upon the expiration of such limited exercise period or (if earlier) upon the Expiration Date, this option shall 

terminate and cease to be outstanding for any vested Option Shares for which the option has not been exercised. However, this option shall, immediately upon Optionee's cessation of Service for any reason, terminate and cease to be outstanding with respect to any Option Shares for which this option is not otherwise at that time exercisable.
Should Optionee's Service be terminated for Misconduct, then this option shall terminate immediately and cease to remain outstanding.
CHANGE IN CONTROL/HOSTILE TAKE-OVER
Unless otherwise determined by the Plan Administrator in the event of a Change in Control/Hostile Take-Over, any surviving corporation or acquiring corporation (or the surviving or acquiring corporation’s parent company) may assume or continue this option or may substitute similar stock awards for this option (including but not limited to, awards to acquire the same consideration paid to the stockholders of the Corporation pursuant to the Change in Control/Hostile Take-Over), and any reacquisition or repurchase rights held by the Corporation in respect of Common Stock issued pursuant to this option may be assigned by the Corporation to the successor of the Corporation (or the successor’s parent company, if any), in connection with such Change in Control/Hostile Take-Over. A surviving corporation or acquiring corporation (or its parent) may choose to assume or continue only a portion of this option or substitute a similar stock award for only a portion of this option, or may choose not to assume this option. The terms of any assumption, continuation or substitution will be set by the Board. If either (x) Optionee’s employment with the Corporation is terminated by the Corporation without Cause (which termination shall be effective as of the date specified by the Corporation in a written notice to Optionee), other than due to death or Permanent Disability, or in the event Optionee terminates his or her employment with Good Reason, in either case within twelve months following a Change in Control/Hostile Take-Over, or (y) Optionee voluntarily terminates his or her employment on his or her own initiative after the twelfth month but no later than the thirteenth month following a Change in Control/Hostile Take-Over, in either case of (x) or (y), then the vesting of this option will be accelerated in full and the time when this option may be exercised will be accelerated in full. Such vesting acceleration will occur on the date of termination of Optionee’s Service.
In the event of a Change in Control/Hostile Take-Over in which the surviving corporation or acquiring corporation (or its parent company) does not assume or continue this option or substitute similar stock awards for this option, then if this option has not been assumed, continued or substituted, the vesting of this option will be accelerated in full to a date prior to the effective time of such Change in Control/Hostile Take-Over (contingent upon the effectiveness of the Change in Control/Hostile Take-Over) as the Board will determine (or, if the Board does not determine such a date, to the date that is five days prior to the effective time of the Change in Control/Hostile Take-Over), and this option will terminate if not exercised (if applicable) at or prior to the effective time of the Change in Control/Hostile Take-Over, and any reacquisition or repurchase rights held by the Corporation with respect to this option will lapse (contingent upon the effectiveness of the Change in Control/Hostile Take-Over). 
Notwithstanding the foregoing, in the event this option will terminate if not exercised prior to the effective time of a Change in Control/Hostile Take-Over, the Board may provide, in its sole discretion, that Optionee may not exercise this option but instead 

will receive a payment, in such form as may be determined by the Board, equal in value to the excess, if any, of (i) the value of the property Optionee would have received upon the exercise of this option immediately prior to the effective time of the Change in Control/Hostile Take-Over (including, at the discretion of the Board, any unvested portion of this option), over (ii) any exercise price payable by Optionee in connection with such exercise. For clarity, this payment may be zero if the value of the property is equal to or less than the exercise price. Payments under this provision may be delayed to the same extent that payment of consideration to the holders of the Common Stock in connection with the Change in Control/Hostile Take-Over is delayed as a result of escrows, earn outs, holdbacks or any other contingencies. 
The portion of any Incentive Option accelerated in connection with a Change in Control or Hostile Take-Over shall remain exercisable as an Incentive Option only to the extent the applicable One Hundred Thousand Dollar ($100,000) limitation is not exceeded. To the extent such dollar limitation is exceeded, the accelerated portion of such option shall be exercisable as a Non-Statutory Option under the Federal tax laws. 
ADJUSTMENT IN OPTION SHARES. Should any change be made to the Common Stock by reason of any stock split, stock dividend, recapitalization, combination of shares, exchange of shares or other change affecting the outstanding Common Stock as a class without the Corporation's receipt of consideration, appropriate adjustments shall be made to the number and/or class of securities and the Exercise Price in effect under this option. Such adjustments to this option are to be effected in a manner which shall preclude the enlargement or dilution of rights and benefits under this option. The adjustments determined by the Plan Administrator shall be final, binding and conclusive
STOCKHOLDER RIGHTS. The holder of this option shall not have any stockholder rights with respect to the Option Shares until such person shall have exercised the option, paid the Exercise Price and become a holder of record of the purchased shares.
MANNER OF EXERCISING OPTION.
In order to exercise this option with respect to all or any part of the Option Shares for which this option is at the time exercisable, Optionee (or any other person or persons exercising the option) must take the following actions:
Execute and deliver to the Corporation a Preclearance to Exercise Options Form, attached hereto as Schedule I, for the Option Shares for which the option is exercised.  
Pay the aggregate Exercise Price for the purchased shares in one or more of the following forms:
		
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	cash or check made payable to the Corporation;

		
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	the surrender of shares of Common Stock owned by Optionee (provided that shares acquired pursuant to the exercise of options granted by the Corporation must have been held by Optionee for the requisite period necessary to avoid a charge to the Corporation’s earnings for financial reporting purposes), which surrendered shares shall be valued at Fair Market Value as of the date of such exercise;

		
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	the cancellation of indebtedness of the Corporation to Optionee;

		
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	provided that a public market for the Common Stock exists, a “same day sale” commitment from Optionee and an NASD Dealer whereby Optionee irrevocably elects to exercise this option and to sell a portion of the shares so purchased to pay for the Exercise Price and whereby the NASD Dealer irrevocably commits upon receipt of such shares to forward the Exercise Price directly to the Corporation;

		
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	the waiver of compensation due or accrued for services rendered or to be rendered during a vesting period; or

		
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	any combination of the foregoing methods of payment or any other consideration or method of payment as shall be permitted by applicable law.

Except to the extent the sale and remittance procedure is utilized in connection with the option exercise, payment of the Exercise Price must accompany the Notice of Exercise delivered to the Corporation in connection with the option exercise.
Furnish to the Corporation appropriate documentation that the person or persons exercising the option (if other than Optionee) have the right to exercise this option.
Make appropriate arrangements with the Corporation (or Parent or Subsidiary employing or retaining Optionee) for the satisfaction of all Federal, state and local income and employment tax withholding requirements applicable to the option exercise.
As soon as practical after the Exercise Date, the Corporation shall issue to or on behalf of Optionee (or any other person or persons exercising this option) a certificate for the purchased Option Shares, with the appropriate legends affixed thereto.  To the extent any such Option Shares are unvested, the certificates for those Option Shares shall be endorsed with an appropriate legend evidencing the Corporation's repurchase rights and may be held in escrow with the Corporation until such shares vest.
In no event may this option be exercised for any fractional shares.
NO IMPAIRMENT OF RIGHTS.  This Agreement shall not in any way affect the right of the Corporation to adjust, reclassify, reorganize or otherwise make changes in its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets.  In addition, this Agreement shall not in any way be construed or interpreted so as to affect adversely or otherwise impair the rights of the Corporation (or any Parent or Subsidiary employing or retaining Optionee) or of Optionee, which rights are hereby expressly reserved by each, to terminate Optionee's Service at any time for any reason, with or without cause.
COMPLIANCE WITH LAWS AND REGULATIONS. The exercise of this option and the issuance of the Option Shares upon such exercise shall be subject to compliance by the Corporation and Optionee with all applicable requirements of law relating thereto and with all applicable regulations of any Stock Exchange on which the Common Stock may be listed for trading at the time of such exercise and issuance.
The inability of the Corporation to obtain approval from any regulatory body having authority deemed by the Corporation to be necessary to the lawful issuance and sale of any Common Stock pursuant to this option shall relieve the Corporation of any liability with respect to 

the non-issuance or sale of the Common Stock as to which such approval shall not have been obtained. The Corporation, however, shall use its best efforts to obtain all such approvals.
SUCCESSORS AND ASSIGNS. Except to the extent otherwise provided in Paragraphs 3 and 6 hereof, the provisions of this Agreement shall inure to the benefit of, and be binding upon, the Corporation and its successors and assigns and Optionee, Optionee's assigns and the legal representatives, heirs and legatees of Optionee's estate.
NOTICES. Any notice required to be given or delivered to the Corporation under the terms of this Agreement shall be in writing and addressed to the Corporation at its principal corporate offices. Any notice required to be given or delivered to Optionee shall be in writing and addressed to Optionee at the address indicated below Optionee's signature line on the Grant Notice. All notices shall be deemed effective upon personal delivery or upon deposit in the U.S. mail, postage prepaid and properly addressed to the party to be notified.
CONSTRUCTION. This Agreement and the option evidenced hereby are made and granted pursuant to the Plan and are in all respects limited by and subject to the terms of the Plan. All decisions of the Plan Administrator with respect to any question or issue arising under the Plan or this Agreement shall be conclusive and binding on all persons having an interest in this option.
GOVERNING LAW. The interpretation, performance and enforcement of this Agreement shall be governed by the laws of the State of Delaware without resort to that State's conflict-of-laws rules.
EXCESS SHARES. If the Option Shares covered by this Agreement exceed, as of the Grant Date, the number of shares of Common Stock which may without stockholder approval be issued under the Plan, then this option shall be void with respect to those excess shares, unless stockholder approval of an amendment sufficiently increasing the number of shares of Common Stock issuable under the Plan is obtained in accordance with the provisions of the Plan.
ADDITIONAL TERMS APPLICABLE TO AN INCENTIVE OPTION. In the event this option is designated an Incentive Option in the Grant Notice, the option is intended to be an incentive stock option as described in Code Section 422, but the Corporation does not represent or warrant that the option qualifies as such.  Optionee should consult with his or her own tax advisors regarding the tax effects of this option and the requirements necessary to obtain favorable income tax treatment under Code Section 422, including, but not limited to, holding period requirements with respect to the Option Shares after exercise of this option.  In addition, the following terms and conditions shall also apply to the grant:
This option shall cease to qualify for favorable tax treatment as an Incentive Option if (and to the extent) this option is exercised for one or more Option Shares: (A) more than three (3) months after the date Optionee ceases to be an Employee for any reason other than death or Permanent Disability or (B) more than twelve (12) months after the date Optionee ceases to be an Employee by reason of Permanent Disability.
No installment under this option shall qualify for favorable tax treatment as an Incentive Option if (and to the extent) the aggregate Fair Market Value (determined at the Grant Date) of the Common Stock for which such installment first becomes exercisable hereunder would, when added to the aggregate value (determined as of the respective date or dates of grant) of the Common Stock or other securities for which this option or any other Incentive Options granted to 

Optionee prior to the Grant Date (whether under the Plan or any other option plan of the Corporation or any Parent or Subsidiary) first become exercisable during the same calendar year, exceed One Hundred Thousand Dollars ($100,000) in the aggregate. Should such One Hundred Thousand Dollar ($100,000) limitation be exceeded in any calendar year, this option shall nevertheless become exercisable for the excess shares in such calendar year as a Non-Statutory Option.
Should the exercisability of this option be accelerated upon a Change in Control, then this option shall qualify for favorable tax treatment as an Incentive Option only to the extent the aggregate Fair Market Value (determined at the Grant Date) of the Common Stock for which this option first becomes exercisable in the calendar year in which the Change in Control occurs does not, when added to the aggregate value (determined as of the respective date or dates of grant) of the Common Stock or other securities for which this option or one or more other Incentive Options granted to Optionee prior to the Grant Date (whether under the Plan or any other option plan of the Corporation or any Parent or Subsidiary) first become exercisable during the same calendar year, exceed One Hundred Thousand Dollars ($100,000) in the aggregate. Should the applicable One Hundred Thousand Dollar ($100,000) limitation be exceeded in the calendar year of such Change in Control, the option may nevertheless be exercised for the excess shares in such calendar year as a Non-Statutory Option.
Should Optionee hold, in addition to this option, one or more other options to purchase Common Stock which become exercisable for the first time in the same calendar year as this option, then the foregoing limitations on the exercisability of such options as Incentive Options shall be applied on the basis of the order in which such options are granted.

SCHEDULE I
PRECLEARANCE TO EXERCISE OPTIONS

I,_______________________, hereby notify Acacia Research Corporation (the “Corporation”) that I elect to purchase ____________ shares (the “Exercised Shares”) of the Corporation’s Common Stock (“Common Stock”) at the option exercise price of ________per share (the “Exercise Price”) pursuant to that certain option granted to me under the Acacia Research Corporation 2016 Stock Incentive Plan on ____________, 20__(the “Option”).  

Type of Option

_______ Incentive Option (ISO)                _______Non-Statutory Option (Non-Qual)

Type of Transaction

		
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	Cash Exercise (Purchase of the option shares with the intent to hold the shares for sale at a future date).  NOTE: If you choose to do a cash exercise, you may not sell the acquired share without subsequent approval during a period when the trading window is open.  Please refer to the Acacia Insider Trading Policy. 

		
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	Cashless Exercise (Same-day purchase of the option shares and immediate sale of all the shares on the open market.)

		
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	Sell-to-Cover Exercise (Purchase of the option shares and immediate sale of less than all the shares).  NOTE: If you choose to do a Sell-to-Cover exercise, you may not sell the remaining shares without subsequent approval during a period when the trading window is open.  Please refer to the Acacia Insider Trading policy. 

Concurrently with the delivery of this Notice of Exercise to the Corporation, I shall pay, or cause to be paid to the Corporation the Exercise Price for the Exercised Shares in accordance with the provisions of my agreement with the Corporation (or other documents) evidencing the Option and shall deliver whatever additional documents may be required by such agreement as a condition for exercise.  

I hereby certify as of the date above that: 
		
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	I have previously received and am familiar with the Corporation’s Insider Trading Policy; 

		
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	I have complied with all procedures established by the Corporation’s Insider Trading Policy in connection with the transaction described above; and

		
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	To my knowledge, I am not in possession of any material nonpublic information about the Corporation and/or its affiliated companies.

I acknowledge that I have ten (10) business days from the date of approval, or until the window closes, whichever is shorter, in which to complete the trade I have requested.  I also acknowledge that I will notify ________ by email as soon as I have given my broker any exercise instructions. 
  
_______________________                __________________________________
Date                            Signature

APPROVED: 
_________________________________

Date:_____________________________Exhibit

ACACIA RESEARCH CORPORATION
2016 ACACIA RESEARCH CORPORATION STOCK INCENTIVE PLAN
STOCK ISSUANCE AGREEMENT

THIS AGREEMENT  is made this [date] day of [month], 201_, by and between Acacia Research Corporation, a Delaware corporation, and [namename], a Participant in the Corporation’s 2016 Acacia Research Corporation Stock Incentive Plan (the “Plan”).
All capitalized terms in this Agreement shall have the meaning assigned to them in this Agreement, in the attached Appendix or, if such term is not defined in this Agreement or the Appendix, such term shall have the meaning assigned to it under the Plan.
		
	A.
	GRANT OF SHARES

1.Grant.  Participant is hereby granted _____ shares of Common Stock (the “Shares”) pursuant to the provisions of the Stock Issuance Program.

2.Consideration.  With respect to the par value of the Shares, such Shares are granted in consideration for past services provided by the Participant to the Corporation.  The consideration for the remaining value of the Shares is provided  and for the services Participant shall provide to the Corporation over the vesting period provided in Paragraph C.2. 

3.Other Documents.   Participant shall deliver a duly executed blank Assignment Separate from Certificate (in the form attached hereto as Exhibit I) with respect to the Shares. 

4.Stockholder Rights.  Until such time as the Unvested Shares are forfeited pursuant to Paragraph C.1., Participant (or any successor in interest) shall have all the rights of a stockholder (including voting, dividend and liquidation rights) with respect to the Shares, subject, however, to the transfer restrictions of this Agreement.

5.Escrow.  The Corporation shall have the right to hold the Shares in escrow until those shares have vested in accordance with Paragraph C.2.

6.Compliance with Law.  Under no circumstances shall shares of Common Stock or other assets be issued or delivered to Participant pursuant to the provisions of this Agreement unless, in the opinion of counsel for the Corporation or its successors, there shall have been compliance with all applicable requirements of applicable securities laws, all applicable listing requirements of any stock exchange (or the Nasdaq National Market, if applicable) on which the Common Stock is at the time listed for trading and all other requirements of law or of any regulatory bodies having jurisdiction over such issuance and delivery.

		
	B.
	TRANSFER RESTRICTIONS

1.Restriction on Transfer.  Except for any Permitted Transfer, Participant shall not transfer, assign, encumber or otherwise dispose of any of the Shares which are Unvested Shares. 

2.Restrictive Legend.  The stock certificate for the Shares shall be endorsed with the following restrictive legend:

“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE UNVESTED AND SUBJECT TO FORFEITURE TO THE CORPORATION IN CERTAIN CIRCUMSTANCES 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 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.”
3.Transferee Obligations.  Each person (other than the Corporation) to whom the 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 the forfeiture provisions to the same extent such shares would be so subject if retained by Participant.

		
	C.
	FORFEITURE OF SHARES.

1.Forfeiture of Shares.  On the date Participant ceases for any reason to remain in Service, all of the Shares in which Participant is not, at the time of his or her termination of Service, vested in accordance with Paragraph C.2. of this Agreement (such shares to be hereinafter referred to as the “Unvested Shares”) shall be forfeited, shall become the property of the Corporation and the Participant shall no longer have any right to or ownership of such Shares.   The certificates representing the forfeited  Unvested Shares shall be delivered to the Corporation as soon as possible after the termination of Service.  

2.Termination of Forfeiture.  One-sixth of the Shares shall vest and the forfeiture shall lapse on each six month anniversary of your first day of employment, so that on the third year anniversary of your first day of employment, the forfeiture shall have lapsed as to all of the Shares and there will be no Unvested Shares.  This vesting is subject to Participant's continuous service from the first day of employment through each vesting date.

3.Recapitalization.  Any new, substituted or additional securities or other property (including cash paid other than as a regular cash dividend) which is by reason of any Recapitalization distributed with respect to the Shares shall be immediately subject to forfeiture pursuant to this Paragraph C and any escrow requirements hereunder, but only to the extent the Shares are at the time covered by such forfeiture or escrow requirements.  Appropriate adjustments to reflect such distribution shall be made to the number, kind, type and/or class of securities subject to this Agreement in order to reflect the effect of any such Recapitalization upon the Corporation’s capital structure.

4.Change in Control./Hostile Take-Over. All of the Shares shall become fully vested and any Forfeiture Provision shall terminate in full, immediately prior to and contingent upon a Change in Control or Hostile Take-Over.

		
	D.
	TAX PROVISIONS.

1.  Tax Consequences.  Participant has reviewed with Participant’s own tax advisors the federal, state, local and foreign tax consequences of this investment and the transactions contemplated by this Agreement.  Participant is relying solely on such advisors and not on any statements or representations of the Corporation or any of its agents.  Participant understands that Participant (and not the Corporation) shall be responsible for any tax liability that may arise as a result of the transactions contemplated by this Agreement.  Participant understands that Section 83 of the Code, taxes as ordinary income the difference between the purchase price for the Shares and the Fair Market Value of the Shares as of the date any restrictions on the Shares lapse.  In this context, “restriction” includes forfeiture provision pursuant to Paragraph C.1. with respect to the Unvested Shares.  Participant understands that Participant may elect to be taxed at the time the Shares are granted rather than when and as the forfeiture provision lapses by filing an election under Section 83(b) of the Code with the IRS within thirty (30) days from the date of grant.  Participant acknowledges that it is Participant’s sole responsibility, and not the Corporation’s, to file a timely election under code section 83(b), even if Participant requests the Corporation or its representatives to make this filing on his or her behalf.

2.Withholding Obligations.  At the time the Shares subject to this Agreement are granted, or at any time thereafter as requested by the Corporation, Participant hereby authorizes withholding from payroll and any other amounts payable to Participant, including these Shares, and otherwise agrees to make adequate provision for, any sums required to satisfy the federal, state, local and foreign tax withholding obligations of the Corporation or any Parent or Subsidiary, if any, which arise in connection with the grant of the Shares.

The Corporation, in its sole discretion, and in compliance with any applicable legal conditions or restrictions, may withhold from fully vested Shares otherwise deliverable to Participant upon the vesting of the Unvested Shares a number of whole Shares having a Fair Market Value, as determined by the Corporation as of the date of vesting, not in excess of the amount of tax required to be withheld by law (or such lower amount as may be necessary to avoid adverse financial accounting treatment).  Any adverse consequences to Participant arising in connection with such share withholding procedure shall be the Participant’s sole responsibility.
Unless the tax withholding obligations of the Corporation or any Parent or Subsidiary are satisfied, the Corporation shall have no obligation to issue a certificate for such Shares or release such Shares from any escrow provided for herein.
		
	E.
	GENERAL PROVISIONS

1.Assignment.  The Corporation may assign its rights under this Agreement, including, but not limited to the forfeiture provision of Paragraph C.1., to any person or entity selected by the Board, including (without limitation) one or more stockholders of the Corporation.

2.Employment At Will .  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 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 enforce the forfeiture provision or any other term of this Agreement shall not constitute a waiver of any other forfeiture provision or other term 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 Shares subject to this Agreement are forfeited, then from and after such time, the person from whom such Shares are forfeited shall no longer have any rights as a holder of such Shares.  Such shares shall be deemed forfeited 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.

6.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 Shares pursuant to the provisions of this Agreement.

7.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.  In the event of a conflict between the Plan and this Agreement, the terms of the Plan shall govern.

8.Governing Law.  This Agreement shall be governed by, and construed in accordance with, the laws of the State of California without regard  to the  conflict-of-laws rules thereof or of any other jurisdiction.

9.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.

10.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.

11.Representations. Participant agrees upon request to execute any further documents or instruments necessary or desirable in the sole determination of the Corporation to carry out the purposes or intent of this Agreement.
12.

Participant acknowledges and agrees that Participant has reviewed the Agreement in its entirety, has had an opportunity to obtain the advice of counsel prior to executing and accepting the award and fully understands all provisions of the Agreement.

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

By:_________________________________
Title:________________________________
Address:_____________________________
_____________________________

                                                                               PARTICIPANT     
By:________________________________
Name:________________________________
Address:______________________________
______________________________

SPOUSAL ACKNOWLEDGMENT
The undersigned spouse of the Participant has read and hereby approves the foregoing Stock Issuance Agreement.  In consideration of the Corporation’s granting the Participant the right to acquire the Shares in accordance with the terms of such Agreement, the undersigned hereby agrees to be irrevocably bound by all the terms of such Agreement, including (without limitation) the forfeiture to the Corporation (or its assigns) any Shares in which the Participant is not vested at the time of his or her termination of Service.

PARTICIPANT'S SPOUSE     
               By:________________________________
Name:________________________________
Address:______________________________
______________________________

EXHIBIT I
ASSIGNMENT SEPARATE FROM CERTIFICATE

FOR VALUE RECEIVED _______________________ hereby sell(s), assign(s) and transfer(s) unto Acacia Research Corporation  (the “Corporation”), _____________________ (________) shares of the Common Stock of the Corporation standing in his or her name on the books of the Corporation represented by Certificate No. ______________ herewith and do(es) hereby irrevocably constitute and appoint ______________________________ Attorney to transfer the said stock on the books of the Corporation with full power of substitution in the premises.
Dated:  _________________, _____.
Signature     ________________________________
                                

Instruction:  Please do not fill in any blanks other than the signature line.  Please sign exactly as you would like your name to appear on the issued stock certificate.  The purpose of this assignment is to enable the Corporation to enforce the forfeiture provision without requiring additional signatures on the part of Participant.

APPENDIX

The following definitions shall be in effect under the Agreement:

A.Agreement shall mean this Stock Issuance Agreement.

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

C.Participant shall mean the person to whom the Shares are issued under the Stock Issuance Program.

D.Permitted Transfer shall mean (i) a gratuitous transfer of the Shares, provided and only if Participant obtains the Corporation’s prior written consent to such transfer, (ii) a transfer of title to the Shares effected pursuant to Participant’s will or the laws of inheritance 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 Shares.

E.Plan shall mean the Corporation’s 2013 Acacia Research Corporation Stock Incentive Plan.

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

G.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.

H.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. Service shall not be deemed to cease during a period of military leave, sick leave or other personal leave approved by the Corporation; provided, however, that except to the extent otherwise required by law, no Service credit shall be given for purposes of the vesting of the Unvested Shares hereunder for any period the Participant is on a leave of absence.

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

J.Unvested Shares shall have the meaning assigned to such term in Paragraph C.1.

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