Document:

exv10w3a

 

EXHIBIT 10.3a

EXHIBIT A

VOLCANO CORPORATION

GRANTEE RESTRICTION AGREEMENT

     THIS GRANTEE RESTRICTION AGREEMENT (the “Agreement”) is made and entered into as of
between VOLCANO CORPORATION, a Delaware corporation (the “Company”), and (“Grantee”).

RECITALS:

     WHEREAS, Grantee owns as of the date hereof an option (the “Option”) granted by the Company to
purchase all or any part of an aggregate of ( ) shares (the “Shares”) of the Common Stock
of the Company at a price of ($ ) per Share. The term “Shares” refers to all shares
acquired or which could be acquired pursuant to such Option and to all securities received in
addition thereto or in replacement thereof, pursuant to or in consequence of any stock dividend,
stock split, recapitalization, merger, reorganization, exchange of shares or other similar event.

     THE PARTIES AGREE AS FOLLOWS:

     1.     Company’s Right to Repurchase Upon Termination of Employment.

          1.1     Repurchase Right. The Shares shall be subject to a right (but not obligation) of
repurchase in favor of the Company (the “Right of Repurchase”). If the Grantee ceases to be
employed by or provide services to the Company or an affiliate for any reason whatsoever (the
“Employment Termination”) before the Right of Repurchase expires in accordance with Schedule 1
hereto, the Company may purchase Shares subject to the Right of Repurchase at a purchase price per
share equal to the purchase price per share paid by the Grantee for the Shares (exclusive of any
taxes paid upon acquisition of the stock). The Grantee may not dispose of or transfer any Shares
while such Shares are subject to the Right of Repurchase and any such attempted transfer shall be
null and void. The Company’s rights under this Section 1.1 shall be freely assignable, in whole or
in part.

          1.2     Repurchase Procedure. The Company’s Right of Repurchase shall terminate if not
exercised by written notice from the Company to the Grantee within ninety (90) days from the date
on which the Company learns of the Employment Termination. If the Company exercises its Right of
Repurchase, the Grantee shall promptly endorse and deliver to the Company the stock certificates
representing the Shares being repurchased, and the Company shall then pay promptly (but in no event
later than ninety (90) days after the date of Employment Termination), pursuant to the provisions
of Section 1.3 of this Agreement, the total repurchase price to the Grantee.

          1.3     Repurchase Payment. If, at the time of repurchase, any notes are outstanding
which represent any portion of the total purchase price for Shares being so

 

 

repurchased, the repurchase price shall be paid first by cancellation of any obligation for
accrued but unpaid interest under such notes, next by cancellation of principal under such notes,
and finally by payment of cash or check.

          1.4     Binding Effect. The Company’s Right of Repurchase shall inure to the benefit of
the successors and assigns of the Company and shall be binding upon any representative, executor,
administrator, heir, or legatee of the Grantee.

     2.     Company’s Right of First Refusal Respecting Shares.

          2.1     Right of First Refusal. Subject to Section 2.5, in the event that the Grantee
proposes to sell, pledge, or otherwise transfer any Shares, the Company shall have a right of first
refusal (the “Right of First Refusal”) with respect to such Shares. Grantee shall give a written
notice (the “Transfer Notice”) to the Company describing fully any proposed transfer of Shares,
including the number of Shares proposed to be transferred, the proposed transfer price, and the
name and address of the proposed transferee. The Transfer Notice shall be signed both by the
Grantee and by the proposed transferee. The Company shall have the right to purchase all, but not
less than all, of the Shares subject to the Transfer Notice at a price per share equal to the lower
of (i) the proposed per share transfer price, or (ii) the fair market value of a share of Common
Stock of the Company, as most recently determined by the Board of Directors of the Company (the
“Board”) prior to delivery of the Transfer Notice, by delivery of a notice of exercise of the
Company’s Right of First Refusal within thirty (30) days after the date the Transfer Notice is
delivered to the Company. The Company’s rights under this Section 2.1 shall be freely assignable,
in whole or in part.

          2.2     Transfer of Shares. If the Company fails to exercise the Right of First Refusal
within thirty (30) days from the date the Transfer Notice is delivered to the Company, the Grantee
may, not later than ninety (90) days following delivery to the Company of the Transfer Notice,
conclude a transfer of the Shares subject to the Transfer Notice on the terms and conditions
described in the Transfer Notice. Any proposed transfer on terms and conditions different from
those described in the Transfer Notice, as well as any subsequent proposed transfer by the Grantee,
shall again be subject to the Right of First Refusal and shall require compliance by the Grantee
with the procedure described in Section 2.1 of this Agreement. If the Company exercises the Right
of First Refusal, the parties shall consummate the sale of Shares on the terms set forth in the
Transfer Notice; provided, however, in the event the Transfer Notice provides for payment for the
Shares other than in cash, the Company shall have the option of paying for the Shares by the
discounted cash equivalent of the consideration described in the Transfer Notice.

          2.3     Binding Effect of Right of First Refusal. The Company’s Right of First Refusal
shall inure to the benefit of the successors and assigns of the Company and shall be binding upon
any transferee of Shares other than a transferee acquiring Shares in a transaction where the
Company failed to exercise the Right of First Refusal (a “Free Transferee”) or a transferee of a
Free Transferee.

          2.4     Termination of the Company’s Right of First Refusal. Notwithstanding anything in
this Section 2, the Company shall have no Right of First Refusal, and Grantee shall have no
obligation to comply with the procedures in Sections 2.1 through 2.3 after the earlier of (i) the
Company’s initial registered public offering of Common Stock to the public generally, or (ii) the
date ten (10) years after the date of this Agreement.

 

 

     2.5 Limitations to Rights. Without regard and not subject to the provisions of
Section 2.1;

          (a)     The Grantee may sell or otherwise assign Shares to any or all of his ancestors,
descendants, spouse, or members of his immediate family, or to a custodian, trustee (including a
trustee of a voting trust), executor, or other fiduciary for the account of his ancestors,
descendants, spouse, or members of his immediate family, provided that each such transferee or
assignee, prior to the completion of the sale, transfer, or assignment, shall have executed
documents assuming the obligations of the Grantee under this Agreement with respect to the
transferred securities.

          (b)     To the extent permitted by the Company, the Grantee may sell or transfer Shares in the
first firmly underwritten public offering of securities of the Company registered under the
Securities Act of 1933, as amended.

     3.     Involuntary Transfers. Subject to the provisions of Section 1 above, in the event,
at any time after the date of this Agreement, of any transfer by operation of law or other
involuntary transfer (excluding upon death but including upon divorce or as a result of bankruptcy,
attachment, levy execution, sequestration or garnishment) of all or any portion of the Shares by
the record holder thereof, the Company shall have a right (but not an obligation) to acquire all or
any of the Shares, and any such transferee shall be subject to and bound by the terms of this
Section 3. Upon any such transfer, the transferee thereof shall immediately notify the Company in
writing of such transfer. The right of the Company under this Section 3 to acquire any or all of
the Shares so transferred shall terminate ninety (90) days following receipt of such notice from
the transferee. If the Company elects to exercise such right as to any or all of the Shares, the
Company shall notify the transferee in writing thereof within such ninety (90) day period,
specifying therein the number of Shares to be so acquired (and, if less than all of the Shares so
transferred, the specific Shares to be so acquired), accompanied by payment, in cash or by check,
for the Shares being so acquired. The purchase price to be paid by the Company for the Shares to
be so acquired shall be the sum of the fair market value per share thereof as of such date, as
determined in good faith by the Board (which determination shall be final, binding and conclusive
on the Company and the transferee). Upon receipt of the foregoing, the transferee shall promptly
endorse and deliver to the Company the stock certificates representing the Shares being acquired by
the Company pursuant hereto. The Company’s rights under this Section 3 shall be freely assignable,
in whole or in part.

     4.     Stock Certificate Restrictive Legends. Stock certificates evidencing Shares may
bear such restrictive legends as the Company and the Company’s counsel deem necessary or advisable
under applicable law or pursuant to this Agreement, including, without limitation, the following
legends:

	 	 	 	“THE SECURITIES REPRESENTED HEREBY MAY BE SUBJECT TO A RIGHT OF
REPURCHASE BY THE COMPANY, PURSUANT TO THE PROVISIONS OF AN
AGREEMENT BETWEEN THE COMPANY AND THE ORIGINAL PURCHASER OF SUCH
SECURITIES RELATING TO SUCH SECURITIES.”	 

	 	 	 	“THE SECURITIES REPRESENTED HEREBY ARE SUBJECT TO A RIGHT OF FIRST
REFUSAL BY THE COMPANY PURSUANT TO THE PROVISIONS OF AN
AGREEMENT BETWEEN THE COMPANY AND THE ORIGINAL PURCHASER OF SUCH
SECURITIES RELATING TO SUCH SECURITIES, AND MAY NOT BE SOLD OR
OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE TERMS OF SUCH
AGREEMENT.”	 

 

 

     5.     Tax Matters. With respect to the exercise of an Option for unvested Shares, an
election shall be filed by the Grantee with the Internal Revenue Service, within thirty (30) days
of the purchase of the Shares, electing pursuant to Section 83(b) of the Internal Revenue Code (the
“Code”) to be taxed currently on any difference between the purchase price of the Shares and their
fair market value on the date of purchase. In the case of a Nonqualified Stock Option, this will
result in a recognition of taxable income to the Grantee on the date of exercise, measured by the
excess, if any, of the fair market value of the Shares, at the time the Option is exercised over
the purchase price for the Shares. Absent such an election, taxable income will be measured and
recognized by Grantee at the time or times on which the Company’s Right of Repurchase lapses.
Grantee is strongly encouraged to seek the advice of his or her own tax consultants in connection
with the purchase of the Shares and the filing of the Election under Section 83(b) of the Code. A
form of Election under Section 83(b) is attached hereto as Exhibit A for reference.
Grantee acknowledges that it is Grantee’s sole responsibility and not the Company’s to file timely
the election under Section 83(b), even if Grantee requests the Company or its representative to
make this filing on Grantee’s behalf.

     6.      Binding Effect. Subject to the limitations set forth in this Agreement, this
Agreement shall be binding upon, and inure to the benefit of, the executors, administrators, heirs,
legal representatives, successors, and assigns of the parties hereto.

     7.      Damages. Grantee shall be liable to the Company for all costs and damages,
including incidental and consequential damages, resulting from a disposition of Shares which is not
in conformity with the provisions of this Agreement.

     8.      Governing Law and Forum Selection. This Agreement shall be governed by and
construed in accordance with the laws of the State of California applicable to contracts entered
into and wholly to be performed within the State of California by California residents.

     9.      Notices. All notices and other communications under this Agreement shall be in
writing. Unless and until Grantee is notified in writing to the contrary, all notices,
communications and documents directed to the Company and related to the Agreement, if not delivered
by hand, shall be mailed, addressed as follows:

                    VOLCANO CORPORATION

                    2870 Kilgore Road

                    Rancho Cordova, California 95670

                    Attention: Director of Human Resources

Unless and until the Company is notified in writing to the contrary, all notices, communications
and documents intended for Grantee and related to this Agreement, if not delivered by hand, shall
be mailed to Grantee’s last known address as shown on the Company’s books. Notices and
communications shall be mailed by registered or certified mail, return receipt requested, postage
prepaid. All notices related to this Agreement shall be deemed received upon delivery or, if
mailed, within five (5) days after mailing in accordance with this Section 9.

 

 

     10.     Attorneys’ Fees. If any action or proceeding is brought by any party with respect
to this Agreement or with respect to the interpretation, enforcement or breach hereof, the
prevailing party in such action shall be entitled to an award of all reasonable costs of
litigation, including without limitation attorneys’ fees, court costs and expert witness fees, to
be paid by the losing party, in such amount as may be determined by the court having jurisdiction
of such action.

 

 

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year
first above written.

	 	 	 	 	 
	 	VOLCANO CORPORATION

 	 
	 	By:  	 	 
	 	 	 	 
	 	 	 	 
	 

	 	 	 	 	 
	 	 	 
	 	Name:  	                                            Scott Huennekens
 	 
	 	 	 	 
	 	 	 	 
	 

	 	 	 	 	 
	 	 	 
	 	Its:  	
President & Chief Executive Officer
 	 
	 	 	 	 
	 	 	 	 
	 

     Grantee hereby accepts and agrees to be bound by all of the terms and conditions of this
Agreement.

	 	 	 	 	 
	 	 	 
	 	Grantee:  	
 	 
	 	 	 	 
	 	 	 	 
	 

     Grantee’s spouse indicates by the execution of this Agreement his consent to be bound by the
terms herein as to his interests, whether as community property or otherwise, if any, in the
Shares.

	 	 	 	 	 
	 	 	 
	 	Grantee’s Spouse:  	
 	 
	 	 	 	 
	 	 	 	 

 

 

	 	 	 	 	 

SCHEDULE 1 OF THE

GRANTEE RESTRICTION AGREEMENT

     The Right of Repurchase (as defined in Section 1 of the Grantee Restriction Agreement) shall
expire on the date of the one-year anniversary of the date of grant with respect to 25% of the
total number of Shares acquired or to be acquired, and on the anniversary day of each month
thereafter with respect to an additional 1/36th of the remaining (the “Vesting Schedule”). During
any period of leave of absence by the Grantee, as approved by the President of the Company in his
or her sole discretion, the Vesting Schedule shall be tolled until such time as the Grantee’s
approved leave of absence terminates. In no event shall the period of tolling of the Grantee’s
Vesting Schedule extend the termination date of the Option as set forth in Section 3 of the
Nonqualified Option Grant Agreement.

     In the event of a Change in Control (as defined in the Volcano Corporation 2005 Equity
Compensation Plan (the “Plan”)), unless the Company determines otherwise, the Shares shall be
treated as Stock Awards (as defined in the Plan) for purposes of Section 11 of the Plan, and the
restrictions and conditions on all outstanding Shares shall immediately lapse.

	 	 	 
	INITIALED BY:

	 	  Volcano Corporation
	 
	 

	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

	 	 

	 	 	 	 	 
	 	Name:  Scott Huennekens

Its:   President and Chief Executive Officer

 	 

	 	 	 	 	 
	 	 	 
	 	Grantee:  	                                                   ______________________EX-10.5

 

Exhibit 10.5

UNFUNDED
DEFERRED COMPENSATION

PLAN FOR THE DIRECTORS OF

PEOPLES BANK SB

     The provisions of the plan are as follows:

1. Each director may elect on or before December 31st of any year to defer all or a
specified portion of his annual fees for succeeding calendar years.

2. Any person elected to fill a vacancy on the board, and who was not a director on the preceding
December 31st, may elect, before his term begins, to defer all or a specified part of
his annual fees for the balance of the calendar year following such election and for succeeding
calendar years. No deferrals may be made after December 31, 2004.

3. Interest rate paid on deferred fees is the Bank’s regular six-month CD, plus 2%.

4. Amounts deferred under the plan, together with accumulated interest, will be distributed in
annual installments over a ten-year period beginning with the first day of the calendar year
immediately following the year in which the director ceases to be a director.

5. An election to defer fees shall continue from year to year unless terminated by the director by
written request. In the event a director elects to terminate deferring fees, the amount already
deferred cannot be paid to him until he ceases to be a director.

6. In the event the director ceases to be a voting member of the Board of Directors of the Bank, or
if he becomes a proprietor, officer, partner, employee or otherwise becomes affiliated with any
business that is in competition with corporation, the entire balance of his deferred fees,
including interest, may, if directed by the Board of Directors, in its sole discretion, be paid
immediately to him in a lump sum.

7. Upon the death of a director or former director prior to the expiration of the period
during which the deferred amounts are payable, the balance of the deferred fees and interest in his
account shall be payable to his estate or designated beneficiary in full on the first day of the
calendar year, following the year in which he dies.

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ELECTION TO PARTICIPATE IN UNFUNDED DEFERRED COMPENSATION PLAN

     Certificates acknowledged and attested and inserted herewith to become apart of these minutes.

     Adopted by the Board of Directors this 16th day of November 2005, and made effective January
1, 2005.

	 	 	 	 	 	 	 
	 

	 	Attested by:
	 	 
	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	/s/ David A. Bochnowski
	 	/s/ Jon E. DeGuilio	 	 
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Chairman & CEO
	 	Corporate Secretary	 	 

45

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