Document:

exv10w42

 

Exhibit 10.42

PROMISSORY NOTE

(Revolving Credit Loan)

			
	$5,000,000.00
	 	August 25, 2006

     FOR VALUE RECEIVED, BIOPORT CORPORATION, a Michigan corporation (the “Borrower”) promises to
pay to the order of HSBC REALTY CREDIT CORPORATION (USA), a Delaware corporation (hereinafter
referred to as the “Bank”) at its office at 1130 Connecticut Avenue, N.W., 12th Floor,
Washington, D. C. 20036, or at such other place as the Bank may from time to time direct, the sum
of FIVE MILLION AND NO/100 DOLLARS ($5,000,000.00), as such has been advanced and may be
re-advanced, with interest computed daily on the unpaid principal balance at the Interest Rate (as
such term is hereinafter defined), and payable according to the repayment terms set forth herein
(the “Loan”). The Loan is made pursuant to a Loan Agreement of even date herewith (the “Loan
Agreement”) among the Borrower, the Bank and Emergent BioSolutions Inc. (the “Guarantor”). The Loan
is guaranteed by a Guaranty of even date herewith from the Guarantor to the Bank (the “Guaranty”).
The Loan is secured by, among other things, a Mortgage of even date herewith from the Borrower to
the Bank (the “Mortgage”) and a Security Agreement of even date herewith from the Borrower to the
Bank (the “Security Agreement”). This Note, the Loan Agreement, the Guaranty, the Mortgage, the
Security Agreement and any other documents entered into in connection with the Loan are referred to
as the “Loan Documents”).

     Interest Rate and Payment Terms

     This Note shall bear interest at a rate per annum (the “Interest Rate”) equal to LIBOR plus
three and 75/100 percent (3.75%). “LIBOR” means the daily fluctuating rate of interest (rounded
upwards, if necessary to the nearest 1/100 of 1%) appearing on Telerate Page 3750 (or any successor
page) as the 1-month London interbank offered rate for deposits in United States Dollars at
approximately 11:00 a.m. (London time) on the second preceding Business Day, as adjusted from time
to time in the Bank’s sole discretion for then-applicable reserve requirements, deposit insurance
assessment rates and other regulatory costs (the “Index”). If for any reason such rate is not
available, the term “LIBOR” shall mean the fluctuating rate of interest equal to the rate of
interest (rounded upwards, if necessary to the nearest 1/100 of 1%) appearing on Reuters Screen
LIBO Page as the 1-month London interbank offered rate for deposits in United States Dollars at
approximately 11:00 a.m. (London time) on the second preceding day, as adjusted from time to time
in the Bank’s sole discretion for then-applicable reserve requirements, deposit insurance
assessment rates and other regulatory costs; provided, however, if more than one rate is specified
on Reuters Screen LIBO page, the applicable rate shall be the arithmetic mean of all such rates.
Any change in the rate will take effect on the date of such change in the Index as indicated on
Telerate Page 3750. Interest will accrue on any non-banking day at the rate in effect on the
immediately preceding banking day.

     1.01 Interest only on the principal amount outstanding shall be due and payable in arrears on
the 1st day of each month beginning on October 1, 2006 and continuing on the first day
of each month thereafter until October 1, 2007 (the “Conversion Date”). The outstanding principal
balance of this Note on the Conversion Date shall be converted to a four (4) year term

 

 

loan, and thereafter monthly payments on this Note shall be made on the 1st day of
each month, in the amount of principal required to fully amortize this Note in four (4) years, plus
monthly accrued interest. Unless sooner paid, all outstanding principal and any accrued and unpaid
interest on this Note shall be due and payable in full on August 25, 2011.

     The Interest Rate on this Note: (a) will not exceed applicable legal limits, and in the event
a payment is made by the Borrower or received by the Bank in excess of the applicable legal limits,
such excess payment shall be credited as a payment of principal; and (b) shall be computed on the
basis of 360-day year and charged for the actual number of days elapsed in each interest
calculation period.

     In the event that the Bank shall determine that by reason of circumstances affecting the
interbank Eurodollar market, adequate and reasonable means do not exist for determining LIBOR, or
Eurodollar deposits in the relevant amount and for the relevant maturity are not available to the
Bank in the interbank Eurodollar market, the Bank shall give the Borrower prompt notice of such
determination. If such notice is given, and until such notice is withdrawn, the Interest Rate on
this Note shall be a rate per annum equal to the Prime Rate plus 0.25%. “Prime Rate” means the rate
per annum from time to time established by the Bank as the Prime Rate and made available by the
Bank at its main office or, in the discretion of the Bank, the base, reference or other rate then
designated by the Bank for general commercial loan reference purposes, it being understood that
such rate is a reference rate, not necessarily the lowest, established from time to time, which
serves as the basis upon which effective interest rates are calculated for loans making reference
thereto. If, after the date of this Note, any applicable law, treaty, regulation or directive, or
any change therein or in the interpretation or application thereof, shall make it unlawful for the
Bank to make or maintain any LIBOR loan, the Interest Rate on this Note shall be a rate per annum
equal to the Prime Rate plus 0.25%, for so long as such illegality exists.

     Prepayment

     Upon five (5) business days’ written notice from the Borrower to the Bank, the Borrower may
prepay, without penalty or premium (except as described below), the outstanding principal balance
of this Note, in whole or in part, subject to the following terms and conditions:

     (a) any prepayment must be made on an interest payment date or scheduled principal and
interest payment date;

     (b) must include payment of all interest accrued and unpaid on the amount so prepaid as of the
date of such prepayment;

     (c) partial prepayment shall not postpone the due date of any subsequent payment, nor shall it
change the amount of any monthly payment otherwise required to be made under this Note, unless the
Bank otherwise agrees in writing and in advance of receipt of such partial prepayment; and

     (d) if the Interest Rate at the time of prepayment has been converted to a fixed rate pursuant
to an ISDA Master Agreement or other interest rate protection agreement or product provided by the
Bank to fix the interest rate (“Master Agreement”), the Borrower shall pay any

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breakage fees, make whole provisions or other costs and expenses related to such Master
Agreement.

     Fixing Interest Rate

     At any time, the Borrower may enter into a Master Agreement with the Bank to convert the
Interest Rate to a fixed rate for a period of up to, but no longer thank, the final maturity date
on this Note, on such terms as may be agreed to be by the Bank and the Borrower.

     Late Charge

     In the event the Borrower fails to make a payment of principal and/or interest in fully
collected funds within fifteen (15) days after such payment is due, the Borrower shall pay a late
charge to the Bank in an amount equal to five percent (5%) of the overdue installment.

     Default Interest

     Upon an Event of Default (as such term is hereinafter defined) and until such Event of Default
is cured or this Note is paid in full, this Note shall bear interest at a rate equal to three
percent (3%) per annum above the Interest Rate in effect on the date of such Event of Default.

     Events of Default and Remedies

     Subject to any applicable notice and cure periods contained in the Loan Documents, each of the
following shall constitute a default (“Event of Default”) under this Note:

     (a) A failure to make a payment of any sum within ten (10) days of when due under this Note.

     (b) A failure to perform or observe any of the covenants, conditions or terms of this Note or
any other Loan Document.

     (c) Upon the occurrence of an Event of Default or failure to pay the balance hereof when
otherwise due, and notwithstanding the payment of any late charges: (i) all remaining payments
under this Note shall become due and payable together with interest accrued to the date of payment
without notice, at the option of the Bank; (ii) the Borrower shall reimburse the Bank for any
reasonable expenses, costs and attorneys’ fees which the Bank may incur in connection with the
collection of any monies due under this Note or in connection with the enforcement of any right
under this Note or under any of the Loan Documents; and (iii) the Bank may exercise any or all of
the other rights, powers and remedies provided for in any of the Loan Documents, or now or
hereafter existing at law or in equity or by statute or otherwise.

     Miscellaneous

     The Borrower hereby waives demand, presentment for payment, protest, and notice of dishonor,
and agrees that at any time and from time to time and with or without consideration, the Bank may,
without notice to or further consent of the Borrower and without in any manner releasing, lessening
or affecting the obligations of the Borrower: (a) release, surrender, waive,

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substitute, settle, exchange, compromise, modify, extend or grant indulgences with respect to:
(i) this Note; and (ii) all or any part of any collateral or security for this Note; or (b) grant
any extension or other postponements of the time of payment hereof.

     Each right, power and remedy of the Bank as provided for in this Note, or now or hereafter
existing at law or in equity or by statute or otherwise, shall be cumulative and concurrent and
shall be in addition to every other right, power or remedy, and the exercise or beginning of the
exercise by the Bank of any one or more of such rights, powers or remedies shall not preclude the
simultaneous or later exercise by the Bank of any or all of such other rights, powers or remedies.

     No failure or delay by the Bank to insist upon the strict performance of any term, condition
or covenant of this Note, or to exercise any right, power or remedy upon a breach hereof, shall
constitute a waiver of any such term, condition or covenant or of any such breach, nor shall it
preclude the Bank from exercising any such right, power or remedy at any later time or times,
unless such waiver is in writing signed by an authorized representative of the Bank. If the Bank
accepts any payment after its due date, this does not constitute a waiver of the Bank’s right to
receive timely payment of all other subsequent amounts or to declare a default for the failure to
make any other subsequent payment when due.

     Any payment on this Note coming due on a day on which the Bank is not open to conduct full
banking business shall be due on the next succeeding business day. Each payment hereunder may be
applied to pay interest, principal, late fees or costs as the Bank, in its sole discretion, may
determine.

     All notices under this Note shall be given as provided in the Loan Agreement.

     The Borrower authorizes the Bank to disburse funds represented by this Note to the Borrower
and agrees that such disbursement shall be deemed to be full and absolute consideration for the
undertaking to make payment hereunder. The Borrower hereby authorizes the Bank to disclose to any
subsidiary or affiliate of the Bank, to any fiduciary institution or to any banking institution,
credit union or savings and loan association organized under the laws of any State, and hereby
authorizes all subsidiaries and affiliates of the Bank, to disclose to the Bank, the financial
record of the Borrower.

     THE BORROWER AND THE BANK HEREBY VOLUNTARILY AND KNOWINGLY WAIVE ANY RIGHT THEY MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY ACTION, PROCEEDING, OR COUNTERCLAIM BROUGHT BY EITHER PARTY AGAINST
THE OTHER ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS NOTE AND THE TRANSACTIONS CONTEMPLATED
HEREIN. THE BORROWER ACKNOWLEDGES THAT IT HAS BEEN INFORMED BY THE BANK THAT THE PROVISIONS OF THIS
PARAGRAPH CONSTITUTE A MATERIAL INDUCEMENT UPON WHICH THE BANK HAS RELIED, IS RELYING AND WILL RELY
IN MAKING THE LOAN. THE BORROWER HEREBY CERTIFIES THAT NO REPRESENTATIVE OR AGENT OF THE BANK
(INCLUDING ITS COUNSEL) HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT THE BANK WOULD NOT, IN THE
EVENT OF LITIGATION, ENFORCE THIS WAIVER OF

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RIGHT TO JURY TRIAL. THE BORROWER ACKNOWLEDGES THAT IT HAS CONSULTED WITH AN ATTORNEY AND
FULLY UNDERSTANDS THE LEGAL EFFECT OF THE PROVISIONS OF THIS PARAGRAPH.

     This Note shall be governed by and construed under and in accordance with the laws of the
State of New York (but not including the choice of law rules thereof). The Borrower hereby submits
to the non-exclusive jurisdiction of any State of New York court or Federal court sitting in the
State of New York in any action or proceeding arising out of or relating to this Note, and hereby
waives any objection it may have to the laying of venue of any such action or proceeding in any of
said courts and any claim that it may have that any such action or proceeding has been brought in
an inconvenient forum. A final judgment in any such action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by
law.

     Whenever used herein, the word “Borrower” or “Bank” shall be deemed to include, as
appropriate, its/his/her respective heirs, personal representatives, successors and assigns. All
words used herein shall be deemed to refer to the singular, plural, masculine, feminine or neuter
as the identity of the person or entity or the context may require.

(Signature Page Follows)

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     IN WITNESS WHEREOF, the Borrower has duly executed this Note under seal as of the date and
year first hereinabove set forth. This instrument may be signed in multiple counterparts.

	 	 	 	 	 
	 	BIOPORT CORPORATION,

a Michigan corporation

 	 
	 	By:  	
/s/  R. Don Elsey	(SEAL) 
	 	  	Name:  	R. Don
Elsey
	 	  	Title:
 	Treasurer
	 	 	 	 
	 	 	 	 

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CONSENT OF THE GUARANTOR

     The undersigned Guarantor hereby consents to the terms of this Note and acknowledges it has
guaranteed this Note pursuant to the terms of that certain Guaranty executed by the undersigned of
even date herewith.

	 	 	 	 	 
	 	EMERGENT BIOSOLUTIONS INC.,

a Delaware corporation

 	 
	 	By:  	/s/  Fuad
El-Hibri	(SEAL) 
	 	 	Name:  	Fuad El-Hibri
	 	 	Title:  	President & CEO
	 	 	 	 
	 	 	 	 
	 

7exv10w3

 

Exhibit 10.3

Stock Option Award Agreement

     Giga-tronics Incorporated, a California corporation, and the undersigned person
(“Optionee”) have entered into this Stock Option Agreement effective as of the Grant Date set forth
below. The Company has granted to Optionee the option (the “Option”) to purchase the number of
shares (the “Shares”) of common stock, no par value, of the Company (“Stock”) set forth below at
the per Share purchase price (the “Exercise Price”) set forth below, pursuant to the terms of this
Award Agreement. The Option was granted under the Company’s 2005 Equity Incentive Plan, as the
same may be amended, modified, supplemented or interpreted from time to time (the “Plan”), which is
incorporated herein by reference and to which this Option is subject in all respects.

	 	 	 
	Optionee Name:

	 	                                        
	 
	 	 
	Grant Date:

	 	MM/DD/YYYY
	 
	 	 
	Vesting Commencement Date:

	 	MM/DD/YYYY
	 
	 	 
	Number of Shares:

	 	                              
	 
	 	 
	Exercise Price:

	 	$               

1.      Terms of Plan. All capitalized terms used in this Award Agreement and not otherwise defined
shall have the meanings ascribed thereto in the Plan. Optionee confirms and acknowledges that
Optionee has received and reviewed copies of the Plan and the Prospectus, dated July 3, 2006, with
respect to the Plan. The Plan is administered by the Committee which has complete authority to
make all determinations with respect to each Award, to interpret the Plan, to prescribe, amend and
rescind rules and regulations relating to the Plan, to determine the terms and provisions of Award
Agreements, and to make all other determinations under the Plan.

2.      Nature of the Option. The Option has been granted as an incentive to Optionee’s Continuous
Service, and is in all respects subject to such Continuous Service and all other terms and
conditions of this Award Agreement. The Option is intended to be an [Incentive/Nonstatutory]
Option.

3.      Vesting, Exercise and Term of Option. The Option shall vest and become exercisable during its
term in accordance with the following provisions:

          (a)  Vesting and Right of Exercise.

	 	 	 	(i)     The Option shall vest and become exercisable with respect to 25% of the
Shares at the first anniversary of the Vesting Commencement Date and as to
25% of the Shares on each successive anniversary thereafter until all of the
Shares have vested, subject to Optionee’s Continuous Service.

 

 

	 	 	 	(ii)     In the event of Optionee’s death, disability or other termination of
Optionee’s Continuous Service, the Option shall be exercisable in the
following manner:

	 	 	 	(I)     Termination of Employment: the Option ceases to be exercisable 90 days
following termination of employment, during which time it shall be exercisable
only to the extent exercisable at the date of termination, except that the
Option shall not be exercised after its expiration date;

	 	 	 	(II)     Disability: if Optionee was in Continuous Service from the Grant Date
until the date of termination of service due to disability the Option ceases to
be exercisable twelve months following the date of termination of Continuous
Service from disability, during which time it shall be exercisable only to the
extent exercisable at the date of termination due to disability, except that the
Option shall not be exercised after its expiration date; and

	 	 	 	(III)     Death: if the Optionee was in Continuous Service from the Grant Date
until the date of death, the Option ceases to be exercisable twelve months
following the date of death, during which time it shall be exercisable by the
Optionee’s estate or by a person who acquired the right to exercise the Option
by bequest, inheritance or otherwise as a result of the Optionee’s death only to
the extent exercisable at the date of death, except that the Option shall not be
exercised after its expiration date.

	(b)	 	Method of Exercise. In order to exercise any vested portion of the
Option, Optionee shall notify the Company in writing by executing and delivering
the Notice of Exercise of Stock Option in the form attached hereto as Exhibit A
(the “Exercise Notice”). The certificate or certificates representing Shares as to
which the Option has been exercised shall be registered in the name of Optionee or
otherwise as the Optionee may request and the Company shall permit.

	(c)	 	Restrictions on Exercise; Term of Option.

	 	 	 	(i)     Optionee may exercise the Option only with respect to Shares that have
vested in accordance with Section 3(a) of this Award Agreement.

	 	 	 	(ii)     Optionee may not exercise the Option if the issuance of the Shares upon
such exercise or the method of payment of consideration for such Shares
would constitute a violation of any applicable federal or state securities
law or other law or regulation.

	 	 	 	(iii)     The method and manner of payment of the Exercise Price will be subject
to the prohibition on loans to directors and executive officers in Section
402 of the Sarbanes-Oxley Act of 2002, to the rules under Part 221 of Title
12 of the Code of Federal Regulations as promulgated by the Federal Reserve
Board, and to any other applicable laws, rules or regulations.

 

 

	 	 	 	(iv)     As a condition to the exercise of the Option, the Company may require
certain representations and warranties as the Company may request pursuant
to Section 9.3 of the Plan. Prior to or subsequent to exercise of the
Option, the Company may require the Optionee to enter into certain lock-up
arrangements as provided in Section 9.4 of the Plan.

	 	 	 	(v)     Optionee may only exercise the Option upon, and the obligations of the
Company under this Award Agreement to issue Shares to Optionee upon any
exercise of the Option is conditioned on, satisfaction of all federal,
state, local or other withholding tax obligations associated with such
exercise (whether so required to secure for the Company a tax deduction or
otherwise) (“Withholding Obligations”). The Company reserves the right to
require Optionee to remit to the Company an amount sufficient to satisfy all
Withholding Obligations prior to the issuance of any Shares upon any
exercise of the Option. In addition, Optionee authorizes the Company to
deduct any such Withholding Obligations from any payments of any kind due to
Optionee (whether in connection with the Option or otherwise). The Optionee
may elect to satisfy Withholding Obligations, in whole or in part, by having
the Company withhold shares of Stock otherwise due to the Optionee upon
exercise of the Option, or by submitting shares of Stock previously owned by
the Optionee .

	 	 	 	(vi)     No fraction of a Share shall be purchasable or deliverable upon
exercise of the Option, but in the event any such Shares shall include a
fraction of a Share (whether due to net exercise, payment of the Exercise
Price by having Shares withheld or by submitting previously owned shares, by
adjustment of the Option as provided in the Plan, or otherwise), such number
of Shares shall be rounded down to the nearest smaller whole number of
Shares.

	 	 	 	(vii)     The Option may not be exercised more than five years after the Grant
Date, and may be exercised during such term only in accordance with the
terms of this Award Agreement.

4.     Transferability of Option.

	(a)	 	The Option may be transferred by the Optionee through a gift or
domestic relations order in settlement of marital property rights, and may be
reacquired by the Optionee from, any “family member” as defined in and in a manner
consistent with Section 6.4 of the Plan, provided that any such transfer is without
payment of any value whatsoever and that no transfer shall be valid unless first
approved by the Committee, acting in its sole discretion.

	(b)	 	The terms of this Award Agreement shall bind the Optionee and his or
her spouse or domestic partner and the respective Permitted Transferees, executors,
administrators, heirs, personal representatives and successors of the foregoing.

 

 

5.     Method of Payment.

	 	 	(a)     Upon exercise, Optionee shall pay the aggregate Exercise Price of the
Shares purchased and the Withholding Obligations by any of the following methods,
or a combination thereof, at the election of Optionee:

	 	 	 	(i)     cash;

	 	 	 	(ii)     certified or bank cashier’s check;

	 	 	 	(iii)     if shares of Stock are traded on an established stock market or
exchange on the date of exercise, by surrender of whole shares of Stock
having a Market Value equal to the portion of the Exercise Price to be paid
by such surrender, provided that if such shares of Stock to be
surrendered were acquired upon exercise of an Incentive Option, Optionee
must have first satisfied the holding period requirements under Section
422(a)(1) of the Code;

	 	 	 	(iv)     by a “net exercise” of the Option, in which the Company will not
require a payment of the Exercise Price but will reduce the number of shares
of Stock issued upon the exercise by the largest number of whole shares that
have a Fair Market Value that does not exceed the aggregate Exercise Price
of the Shares as to which the Option is being exercised. With respect to any
remaining balance of the aggregate Exercise Price, the Company will accept a
cash payment from the Optionee. The number of shares of Stock underlying the
Option will decrease following exercise to the extent of (i) Shares used to
pay the Exercise Price of an Option under the “net exercise” feature, (ii)
Shares actually delivered to the Optionee as a result of such exercise and
(iii) shares withheld to pay the Withholding Obligations;

	 	 	 	(v)     if shares of Stock are traded on an established stock market or exchange
on the date of exercise, pursuant to and under the terms and conditions of
any formal cashless exercise program authorized by the Company entailing the
sale of the Stock subject to an Option in a brokered transaction (other than
to the Company); or

	 	 	 	(vi)     [Stock Appreciation Right. By electing to receive in cash any
excess in the Market Value of any number of shares of Stock subject to
available installments of the Option on the date of exercise, over the
Exercise Price and related Withholding Obligations. This Stock Appreciation
Right will terminate to the extent that the Option is exercised, expires or
is cancelled, and the Option will terminate to the extent that this Stock
Appreciation Right is exercised, expire or is cancelled.]

 

 

	(b)	 	Payment in Stock. If Optionee shall pay all or a portion of the
aggregate Exercise Price and Withholding Obligations due upon an exercise of the
Option by surrendering shares of Stock pursuant to Section 5(a)(iii), then
Optionee:

	 	 	 	(i)     shall accompany the Exercise Notice with a duly endorsed blank stock
power (with an appropriate signature guarantee if requested by the Company)
with respect to the number of shares of Stock to be surrendered and shall
deliver the certificate(s) representing such surrendered shares to the
Company at its principal offices within two business days after the date of
the Exercise Notice;

	 	 	 	(ii)     authorizes the Company to transfer so many whole number of Shares
represented by such certificate(s) that have a Fair Market Value that does
not exceed the aggregate Exercise Price for the Shares as to which the
Option is being exercised. With respect to any remaining balance of the
aggregate Exercise Price, the Company will accept a cash payment from the
Optionee; and

	 	 	 	(iii)     may not surrender any fractional share as payment of any portion of
the Exercise Price.

6.     Adjustments to Option. Pursuant to Section 8.1 of the Plan, in certain cases the number of
Shares covered by the Option and the Exercise Price will be proportionately adjusted if the
outstanding number of shares of Stock are increased, decreased, or exchanged for a different number
or kind of shares or other securities, or if additional shares or new or different shares or other
securities are distributed with respect to the outstanding Stock, through merger, consolidation,
sale of all or substantially all the property of the Company, reorganization, combination,
recapitalization, reclassification, stock dividend, stock split, reverse stock split, or other
similar distribution of the Company’s equity securities without the receipt of consideration by the
Company.

7.     Not an Employment Contract. Nothing in the Plan or this Award Agreement shall confer upon
Optionee any right to continuation of the Optionee’s employment or other association with the
Company or shall interfere with or restrict in any way the rights of the Company, which are hereby
expressly reserved, to modify the terms of Optionee’s employment or to terminate Optionee’s
employment at any time for any reason whatsoever, with or without cause.

8.     Tax Consequences Generally. Optionee acknowledges that Optionee may suffer adverse tax
consequences as a result of exercise of the Option. Optionee acknowledges that the Company advises
Optionee to consult with the Optionee’s tax advisers in connection with the tax implications
relating to the Option including but not limited to the acquisition, disposition or transfer of the
Option or of any securities or property in connection therewith, and that Optionee is not relying
on the Company for any tax advice in connection therewith. Any adverse consequences incurred by an
Optionee in connection with the Option, including, without limitation, from the use of shares of
Stock to pay any part of the Exercise Price or any tax in connection with the exercise of the
Option, and any adverse tax consequences arising from a disqualifying disposition within the
meaning of Section 422 of the Code, shall be the sole responsibility of Optionee.

 

 

9.     Cancellation of Option For Improper Acts of Optionee. If, at any time during the course of the
Optionee’s employment with the Company or any Affiliates or within six months after termination of
Continuous Service, the Optionee engages in any activity in competition with any business activity
of the Company or of any Affiliates, or inimical, contrary or harmful to the interests of the
Company or any Affiliates, then (1) the Option and all other Awards under the Plan made to the
Optionee shall terminate and be forfeited, (2) any cash, security or other property acquired by the
Optionee pursuant to the Option and pursuant to all other Awards under the Plan, which cash,
security or property was acquired by the Optionee during the Forfeiture Period shall be forfeited,
and (3) any gain realized by the Optionee from the sale of any security acquired under the Option
or any other Award during the Forfeiture Period shall be paid by the Optionee to the Company. The
“Forfeiture Period” shall mean the period commencing on the Grant Date of the Option or any other
Award and ending six months from termination of Continuous Service.

10.     Consent of Spouse/Domestic Partner. Optionee agrees that Optionee’s spouse’s or domestic
partner’s interest in the Option is subject to this Award Agreement and such spouse or domestic
partner is irrevocably bound by the terms and conditions of this Award Agreement. Optionee agrees
that all community property interests of Optionee and Optionee’s spouse or domestic partner in the
Option, if any, shall similarly be bound by this Award Agreement. Optionee agrees that this Award
Agreement is binding upon Optionee’s and Optionee’s spouse’s or domestic partner’s executors,
administrators, heirs and assigns. Optionee represents and warrants to the Company that Optionee
has the authority to bind Optionee’s spouse/domestic partner with respect to the Option. Optionee
agrees to execute and deliver such documents as may be necessary to carry out the intent of this
Section 10 and the consent of Optionee’s spouse/domestic partner.

     IN WITNESS WHEREOF, Optionee and the Company have entered into this Award Agreement as of the
Grant Date.

	 	 	 
	 
	 	 
	 

	 	Giga-tronics Incorporated
	 
	 	 
	 

[Optionee Signature]

	 	 
	 
	 	 
	 

	 	By:
	 

	 	 
	 
	 	 
	 

	 	Name:
	 

	 	 
	[Optionee Name]
	 	 
	 
	 	 
	 

	 	Title:
	 

	 	 

 

 

Exhibit A

Notice of Exercise of Stock Option/Tandem Stock Appreciation Right

     I _____________________(please print legibly) hereby elect to
exercise the stock options(s) identified below (the “Option(s)”) granted to me by Giga-tronics
Incorporated (the “Company”) under its 2005 Equity Incentive Plan (the “Plan”) with
respect to the number of shares of Stock of the Company set forth below (the “Shares”). I
acknowledge and agree that my exercise of the Option(s) is subject to the terms and conditions of
the Plan and the Stock Option Award Agreement(s) governing the Option(s). Optionee confirms
and acknowledges that Optionee has received and reviewed copies of the Plan and the Prospectus,
dated ___, with respect to the Plan.

1. _____________ Shares at $  _____________per share (Grant date of Option): ____________

2. _____________ Shares at $  _____________per share (Grant date of Option): ____________

3. _____________ Shares at $  _____________per share (Grant date of Option): ____________

4. _____________ Shares at $  _____________per share (Grant date of Option): ____________

[OPTION EXERCISE]

I choose to pay the Exercise Price of the above option(s) as follows [please complete the numbered
item(s) which apply to your exercise]:

   1. Cash: $_____________________

   2. Check: $____________________ (please make checks payable to Giga-tronics Incorporated)

   3. Surrender of ________________ Shares

   4. Net exercise as described in Section 5(a)(iv) of the Option  ̈ [if applicable check box]

I choose to pay the tax withholding relating to the exercise of the above option(s) as follows:

   5. Cash: $_____________________

   6. Check: $____________________ (please make checks payable to Giga-tronics Incorporated)

   7. Surrender of ________________ Shares currently owned by Optionee

   8. Withholding of ______________ Shares from Shares otherwise deliverable on exercise.

 

 

[EXERCISE OF STOCK APPRECIATION RIGHT]

Instead of exercising the Option and receiving stock, I choose to exercise
the Stock Appreciation Right feature of the Option under which I will receive
in cash the difference between the Exercise Price of the Option and the Market
Value of the Stock on the date of exercise, minus tax Withholding Obligations.

 

[IF APPLICABLE]

Please deliver the stock certificate(s) representing the Shares to (please print legibly):

______________________________________________________

______________________________________________________

______________________________________________________

______________________________________________________

 

	 	 	 	 
	 
	 	 
	Name:
	 	 
	 

	 	 
	(please print legibly)
	 
	 	 
	Signature:
	 	 
	 

	 	 
	 
	 	 
	Date:
	 	 
	 

	 	 
	 
	 	 
	Phone No:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00110-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00110-of-00352.parquet"}]]