SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c) of
the Securities Exchange Act of 1934 (Amendment No. 1)
Check the appropriate box:
X Preliminary Information Statement
_ Confidential, for Use of the Commission Only (as permitted by Rule
14c-5(d)(2))
_ Definitive Information Statement
ROAMING MESSENGER, INC.
---------------------------------------
(Name of Registrant as Specified In Its Charter)
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X No fee required.
__ Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
__ Fee paid previously with preliminary materials.
__ Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
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ROAMING MESSENGER, INC.
6144 CALLE REAL SUITE, 200
SANTA BARBARA, CALIFORNIA 93117
NOTICE OF ACTION TO BE TAKEN BY
THE SHAREHOLDERS
July 21, 2003
To The Shareholders of Roaming Messenger, Inc.
Jonathan Lei, Louie Ucciferri, and Tom Djokovich (collectively, the
"Majority Shareholders"), are the holders of a total of 100,140,025 shares or
approximately 68.8% of the total issued and outstanding stock of Roaming
Messenger, Inc., a Nevada corporation (the "Company"). The Majority Shareholders
intend to adopt the following resolutions by written consent in lieu of a
meeting pursuant to the General Corporation Law of the State of Nevada.
1. Ratify the adoption of the 2003 Stock Option Plan for Roaming Messenger, Inc.
Jonathan Lei, Secretary
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WE ARE NOT ASKING YOU FOR A CONSENT OR A PROXY AND YOU
ARE REQUESTED NOT TO SEND US A PROXY.
-----------
ROAMING MESSENGER, INC.
6144 Calle Real Suite 200
Santa Barbara, California 93117
JULY 21, 2003
SHAREHOLDERS ACTION
The Majority Shareholders will submit their consents to the shareholder
resolutions described in this Information Statement on or about August 6, 2003,
to be effective as of August 25, 2003. As of July 21, 2003, the Majority
Shareholders held of record 100,140,025 shares of the Company's common stock,
par value $0.001 per share, or approximately 68.8% of the total issued and
outstanding common stock of the Company. The remaining outstanding shares of
common stock are held by several hundred other shareholders.
The Majority Shareholders consist of Jonathan Lei, the President, Chief
Financial Officer, Secretary, and Chairman of the Board of Directors of the
Company, Louie Ucciferri, a director of the Company, and Tom Djokovich, a
director of the Company. See "SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS."
Holders of the common stock of record as of July 21, 2003 are entitled
to submit their consent to the shareholder resolutions described in this
Information Statement, although no shareholder consents other than that of the
Majority Shareholders are required to be submitted in order for the resolution
to be adopted. The Company is not soliciting consents or proxies and
shareholders have no obligation to submit either of them. Whether or not
shareholders submit consents should not affect their rights as shareholders or
the prospects of the proposed shareholder resolutions being adopted. The
Majority Shareholders will consent to all of the shareholder resolutions
described in this Information Statement. Other shareholders who desire to submit
their consents must do so by August 25, 2003, and once submitted will not be
revocable. The affirmative vote of the holders of a majority of the outstanding
common stock of the Company is required to adopt the resolutions described in
this Information Statement. California law does not require that the proposed
transaction be approved by a majority of the disinterested shareholders. A total
of 145,640,271 shares of common stock will be entitled to vote on the Company's
proposed transactions described in this Information Statement.
THE COMPANY AND THE TRANSACTION
The Company has its executive offices at 6144 Calle Real Suite 200,
Santa Barbara, California 93117, and its telephone number is (805) 683-7626. As
described in the accompanying NOTICE OF ACTION TO BE TAKEN BY THE SHAREHOLDERS,
the Company proposes to ratify the adoption of the 2003 Stock Option Plan for
Roaming Messenger, Inc. (the "Plan").
The Board of Directors of the Company voted unanimously to adopt the
2003 Stock Option Plan for Roaming Messenger, Inc. The Board of Directors
believes that the adoption of the Plan and option grants it made under the Plan
were critical to attracting, retaining, and motivating employees and other
eligible persons of the Company. The Plan replaces and supercedes that certain
1999 stock option plan (the "W9 Plan") of Warp 9, Inc. ("W9"), a Delaware
corporation and wholly owned subsidiary of the Company. The W9 Plan has been
terminated. The option grants made under the Plan replace option grants recently
cancelled which were previously made to officers, directors, and employees of
the Company and W9 under the W9 Plan. The Plan and the option grants were
approved by disinterested members of the Board as well as by the entire Board.
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The following table sets forth information with respect to stock
options to officers and directors of the Company granted pursuant to the Plan
through July 21, 2003.
Number of Options Exercise
Name Title Granted(1) Price Expiration Date
---------------------------------------------------------------------------------------------------------------
Brian Fox(2) Chief Technology Officer 5,987,500 $0.08 Four years from date
of vesting
All current Executive 5,987,500 $0.08 Four years from date
Officers as a Group of vesting
All current Directors who -0-
are not Executive Officers
as a Group)
All Employees as a Group 2,406,500 $0.08 Four years from date
(not including of vesting
Executive Officers and
Directors)
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(1) All stock options were granted effective July 15, 2003.
(2) Mr. Fox's stock options vest pursuant to the following vesting
schedule: 3,367,969 on July 15, 2003, then 1/21 per month until all
stock options have vested. Does not include 5,987,500 additional
options to purchase 5,987,500 shares of the Company's common stock from
Jonathan Lei, the President, Chief Financial Officer, Secretary, and
Chairman of the Company, for a purchase price of $0.08 per share (the
"Lei Options"), of which 4,490,625 are vested. The remaining Lei
Options vest monthly in equal increments over the next nine months.
DESCRIPTION OF THE PLAN
Below is a summary of the principal provisions of the Plan. The summary
is not necessarily complete, and reference is made to the full text of the Plan
attached as an Exhibit to this Information Statement. Capitalized terms used,
but not defined herein, have the same meaning as set forth in the Plan.
GENERAL. The Plan provides for the grant of stock options to directors,
officers, employees, consultants, and advisors of the Company. The Plan is
administered by a committee consisting of members of the Board of Directors (the
"Stock Option Committee").
SHARES SUBJECT TO THE PLAN. The Plan provides for a total of 25,000,000
shares of common stock to be reserved for issuance subject to options. As of the
date of this Information Statement, the Board had approved the grant of
8,393,750 options to purchase 8,393,750 shares of common stock at an exercise
price of $0.08 per share, subject to shareholder ratification.
ANTI-DILUTION PROTECTION. Proportionate adjustments will be made to the
number of shares of common stock subject to the Plan in the event of any change
in the capitalization of the Company affecting its common stock (e.g., a stock
split, reverse stock split, stock dividend, combination, recapitalization, or
reclassification). The Board or the Stock Option Committee, subject to Board
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approval, may also provide additional anti-dilution protection to a participant
under the terms of such participant's option agreement or otherwise. Shares of
common stock subject to option grants that are canceled, terminated, or
forfeited will again be available for issuance under the Plan.
ADMINISTRATION OF THE PLAN. The Stock Option Committee administers the
Plan and has the authority to modify an existing option, interpret the Plan,
adopt rules and procedures relating to the administration of the Plan, and make
such modifications to the Plan as are necessary to effectuate the intent of the
Plan as a result of any changes in the tax, accounting, or securities laws
treatment of participants and the Plan.
STOCK OPTIONS, RESTRICTED STOCK, AND STOCK APPRECIATION RIGHTS. From
time to time, the Stock Option Committee will recommend to the Board individuals
that the Stock Option Committee believes should receive options, the amount of
shares of common stock the Stock Option Committee believes should be subject to
such option, and whether the option should be a qualified or nonqualified
option. The Board will consider, but need not accept, the Stock Option
Committee's grant recommendations.
The Board may grant nonqualified stock option or incentive stock
options to purchase shares of common stock. Any person who is not an employee on
the effective date of the grant of an option to such person may be granted only
a nonstatutory stock option. Moreover, to the extent that options designated as
incentive stock options become exercisable by a participant for the first time
during any calendar year for stock having a fair market value greater than
$100,000, the portions of such options that exceed such amount will be treated
as nonstatutory stock options. The Plan does not provide for stock appreciation
rights.
The Stock Option Committee, subject to approval by the Board, will
determine the number and exercise price of options, and the time or times that
the options become exercisable, provided that an option exercise price may not
be less than the fair market value of the common stock on the date of grant. The
term of an option will also be determined by the Stock Option Committee, subject
to approval by the Board, provided that the term of a stock option may not
exceed ten years from the date of grant, or five years in the case of a stock
option granted to a 10% shareholder, and that at least 20% of the shares of
common stock subject to each grant of options must become exercisable on each
anniversary date of the date of grant. The Plan provides that each grant of
options will vest in accordance with the applicable option agreement. The option
exercise price may be paid in cash, by check or in such other form of lawful
consideration (including promissory notes or shares of common stock then held by
the participant).
CHANGE OF CONTROL. The Plan provides that in the event of a sale by the
Company of all or substantially all of its assets, a merger of the Company with
another company, the sale or issuance of more than 50% of the total issued and
outstanding voting stock of the Company to another party or parties in a single
transaction or in a series of related transactions, resulting in a change of
control of the Company, or a similar business combination or extraordinary
transaction involving the Company, all outstanding options granted to any
officer, director, or employee of or key consultant to the Company which have
not vested will accelerate to a date at least ten (10) business days prior to
the closing date of such sale or similar business combination or extraordinary
transaction. The exercise of options the vesting of which has accelerated
accordingly will not be effective until the closing date of an above-referenced
extraordinary transaction or business combination. Such vested options will
terminate on the date of the closing of the event causing the vesting of the
options to accelerate. The vesting of the options is conditioned upon the
closing of the transaction that causes the vesting of the options to accelerate.
If said transaction does not close within 30 days from the acceleration date,
then the vesting of the accelerated options will not be effective, and the
options will revert to their original vesting schedule, subject to acceleration
again in accordance with the Plan if another extraordinary transaction or
business combination is proposed and closes.
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TERMINATION OF EMPLOYMENT. If a participant becomes disabled, all
vested options may be exercised at any time within one year after the date on
which the participant's services terminated, but in any event no later than the
option expiration date. If a participant is terminated, his options will expire
and cease to be exercisable 90 days from the date on which the participant's
service terminated. If a participant dies, his options will expire and cease to
be exercisable 90 days after the death of the participant. The termination of
employment of a participant by death, disability or otherwise will not
accelerate or otherwise affect the number of shares with respect to which an
option may be exercised, and the option may only be exercised with respect to
that number of shares which could have been purchased under the option had the
option been exercised by the participant on the date of such termination.
TRANSFERABILITY. During the lifetime of the participant, options will
be exercisable only by the participant or the participant's guardian or legal
representative. No stock option may be assigned or transferred by the
participant, except by will or by the laws of descent and distribution.
STOCKHOLDER RATIFICATION. The Plan must be approved by the stockholders
of the Company within twelve months after the date of its adoption by the Board.
Options granted prior to stockholder ratification may become exercisable no
earlier than the date of stockholder ratification of the Plan. Options granted
to executive officers that are designated as performance based under Section
162(m) of the Code must be contingent on stockholder ratification of the
material terms of the Plan to the extent required under Section 162(m) of the
Code.
AMENDMENTS TO THE PLAN. The Board may amend or discontinue the Plan at
any time subject to certain restrictions set forth in the Plan. No amendment or
discontinuance may adversely affect any previously granted option award without
the consent of the recipient.
FEDERAL INCOME TAX CONSEQUENCES. The following general description of
federal income tax consequences is based upon current statutes, regulations and
interpretations and does not purport to be complete. Reference should be made to
the applicable provisions of the Internal Revenue Code of 1986 (the "Code"). In
addition, state, local and foreign income tax consequences may be applicable to
transactions involving options. The following description does not address
specific tax consequences applicable to an individual participant who receives
an option and does not address special rules that may be applicable to directors
and officers.
Under existing federal income tax provisions, a participant who
receives options will not normally realize any income, nor will the Company
normally receive any deduction for federal income tax purposes, upon the grant
of an option.
When a non-qualified stock option granted pursuant to the Plan is
exercised, the employee generally will realize ordinary income (compensation)
measured by the difference between the aggregate purchase price of the common
stock as to which the option is exercised and the aggregate fair market value of
the common stock on the exercise date. The Company generally will be entitled to
a deduction in the year the option is exercised equal to the amount the employee
is required to treat as ordinary income. Any taxable income recognized in
connection with a non-qualified stock option exercised by an optionee who is
also an employee of the Company will be subject to tax withholding by the
Company. The basis for determining gain or loss upon a subsequent disposition of
common stock acquired upon the exercise of a non-qualified stock option will be
the purchase price paid to the Company for the common stock increased by an
amount included in the optionee's taxable income resulting from the exercise of
such option. The holding period for determining whether gain or loss on such
subsequent disposition is short-term or long-term generally begins on the date
on which the optionee acquires the common stock.
An employee generally will not recognize any income upon the exercise
of an incentive stock option, but the exercise may, depending on particular
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factors relating to the employee, subject the employee to the alternative
minimum tax. An employee will recognize capital gain or loss in the amount of
the difference between the exercise price and the sale price on the sale or
exchange of stock acquired pursuant to the exercise of an incentive stock
option, provided that the employee does not dispose of such stock within two
years from the date of grant and one year from the date of exercise of the
incentive stock option (the "Required Holding Periods"). An employee disposing
of such shares before the expiration of the Required Holding Periods will
recognize ordinary income equal to the lesser of (i) the difference between the
option price and the fair market value of the stock on the date of exercise, or
(ii) the total amount of gain realized. The remaining gain or loss is generally
treated as short term or long-term gain or loss depending on how long the shares
are held. The Company will not be entitled to a federal income tax deduction in
connection with the exercise of an incentive stock option, except where the
employee disposes of the shares of common stock received upon exercise before
the expiration of the Required Holding Periods.
The Company and the Majority Shareholders need not comply with any
federal or state regulatory requirements in connection with ratifying the Plan.
Additional information regarding the Company, its business, its stock,
and its financial condition are included in the Company's Form 10-KSB annual
reports and its Form 10-QSB quarterly reports. Copies of the Company's Form
10-KSB for its fiscal year ending June 30, 2002, and its quarterly report on the
Form 10-QSB for the quarter ending March 31, 2003, and its recent Report on Form
8-K, dated May 15, 2003, are available upon request to: Jonathan Lei, Secretary,
Roaming Messenger, Inc. 6144 Calle Real Suite 200, Santa Barbara, California
93117.
SECURITY OWNERSHIP OF DIRECTORS AND OFFICERS AND CERTAIN BENEFICIAL OWNERS
The following table sets forth certain information known to the Company
with respect to the beneficial ownership of the Company's common stock as of
July 21, 2003 by (i) each person who is known by the Company to own beneficially
more than 5% of the Company's common stock, (ii) each of the Company's directors
and executive officers, and (iii) all officers and directors of the Company as a
group. Except as otherwise listed below, the address of each person is c/o
Roaming Messenger, Inc., 6144 Calle Real Suite 200, Santa Barbara, California
93117.
Number of Shares Beneficially Percentage
Name, Title, and Address Owned(1) Ownership(2)
--------------------------------------------------------------------------------------------------------------
Jonathan Lei
President, Chief Financial Officer,
Secretary, and Chairman..................... 96,087,525 (2) 65.98%
Louie Ucciferri
Director.................................... 3,750,000 2.57%
Tom Djokovich
Director.................................... 302,500 .21%
All current Executive Officers as a Group... 96,087,525 65.98%
All current Directors who are not Executive
Officers as a Group...................... 4,052,500 2.78%
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(1) Except as pursuant to applicable community property laws, the persons
named in the table have sole voting and investment power with respect
to all shares of common stock beneficially owned. The total number of
issued and outstanding shares and the total number of shares owned by
each person does not include unexercised warrants and stock options,
and is calculated as of July 21, 2003.
(2) Includes 5,987,500 shares of common stock which Mr. Lei has set aside
in the event Brian Fox, the Chief Technology Officer of the Company,
exercises his option to purchase such shares for a purchase price of
$0.08 per share (the "Lei Options"). As of July 21, 2003, 4,490,625 Lei
Options are vested. The remaining Lei Options vest monthly in equal
increments over the next nine months.
MANAGEMENT
The following table lists the names and ages of the executive officers
and directors of the Company. The directors were appointed on April 19, 2003 and
will continue to serve until the next annual shareholders meeting or until their
successors are elected and qualified. All officers serve at the discretion of
the Board of Directors.
Name Age Position With the Company
---- --- -------------------------
Jonathan Lei.................... 30 President, Chief Financial
Officer, Secretary, and Chairman
Brian Fox....................... 43 Chief Technology Officer
Louie Ucciferri................. 42 Director
Tom Djokovich (1)............... 46 Director
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(1) Member of Audit Committee.
Jonathan Lei has been the President, Chief Executive Officer, Chief
Financial Officer, and Secretary of the Company since April 2003. Mr. Lei
received a Bachelor Degree in Electrical and Computer Engineering from the
University of California, Santa Barbara ("UCSB") in 1995 and a Master of Science
Degree in Electrical and Computer Engineering from UCSB in 1996. While at UCSB,
he studied and worked in the field of computer aided design and development of
VLSI and ASIC silicon chips. Mr. Lei was employed by Lockheed Martin in 1993
where he built data acquisition systems for spacecraft testing. In 1995, he
worked for Intel Corporation where he developed the Triton II Pentium PCI
chipset. From 1995 to 1996, Mr. Lei worked for RC Electronics where he designed
PCI based data acquisition systems. Mr. Lei founded Warp 9, Inc., a Delaware
corporation and wholly owned subsidiary of the Company ("Warp"), in 1996 and in
1998, he negotiated a transaction to sell Warp's consumer ISP division, Sbnet,
to MindSpring Enterprises. During that same period, Mr. Lei co-developed Warp's
e-commerce products. He is the visionary behind the patent pending eCapsule
technology and Warp's mobile data direction. Mr. Lei was an officer and is a
lifetime member of Tau Beta Pi, a national engineering honor society.
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Brian Fox has been the Chief Technology Officer of the Company since
April 2003. From 1985 to 1988, Mr. Fox worked for the Massachusetts Institute of
Technology as a research software engineer. From 1988 to 1990, he worked at the
University of California at Santa Barbara as a research software engineer. From
1998 to 2000, Mr. Fox served as the co-founder and Chief Technology Officer of
Supply Solution, Inc., a venture capital backed privately held company engaged
in the business of automotive supply chain management. At Supply Solution, Inc.,
Mr. Fox developed the company's flagship product, iSupply, a web based software
for vendor managed inventory tracking. In 1995, prior to co-founding Supply
Solution, Inc. he founded Universal Access, Inc., where he developed the
programming language Meta-HTML. Mr. Fox was the second employee at the Free
Software Foundation (Project GNU). Mr. Fox is the author of BASH, the UNIX
shell, which is widely utilized in modern versions of UNIX.
Louie Ucciferri is the founder and President of Westlake Financial
Architects, an investment-banking firm formed in 1995 to provide financial and
investment advisory services to early stage companies. He has raised investment
capital for both private and public companies and has created liquidity for
investors in the form of public offerings. Since November 1998, he has also
served as President of Camden Financial Services, a NASD registered broker
dealer that serves as the dealer manager for a real estate company that has
raised in excess of $150 million in equity capital for the acquisition of
commercial office properties in southern California and Arizona.
Tom Djokovich was the founder and served from 1995 to 2002 as the Chief
Executive Officer of Accesspoint Corporation, a vertically integrated provider
of electronic transaction processing and e-business solutions for merchants
(OTCBB:ASAP.OB). Under Mr. Djokovich's guidance, Accesspoint became a member of
the Visa/MasterCard association, the national check processing association
NACHA, and developed one of the payment industry's most diverse set of network
based transaction processing, business management and CRM systems for both
Internet and conventional points of sale. During his tenure, Accesspoint became
an early adopter of WAP based e-commerce capabilities and the industry's first
certified Level 1 Internet payment processing engine. In his last year as
executive manager, Accesspoint grew its processing revenues by over 800% and
overall revenues by nearly 300%. Prior to Accesspoint, Mr. Djokovich founded TMD
Construction and Development where he developed an early business-to-business
ordering system for the construction industry.
Under the Nevada General Corporation Law and the Company's Articles of
Incorporation, as amended, the Company's directors will have no personal
liability to the Company or its stockholders for monetary damages incurred as
the result of the breach or alleged breach by a director of his "duty of care".
This provision does not apply to the directors' (i) acts or omissions that
involve intentional misconduct or a knowing and culpable violation of law, (ii)
acts or omissions that a director believes to be contrary to the best interests
of the corporation or its shareholders or that involve the absence of good faith
on the part of the director, (iii) approval of any transaction from which a
director derives an improper personal benefit, (iv) acts or omissions that show
a reckless disregard for the director's duty to the corporation or its
shareholders in circumstances in which the director was aware, or should have
been aware, in the ordinary course of performing a director's duties, of a risk
of serious injury to the corporation or its shareholders, (v) acts or omissions
that constituted an unexcused pattern of inattention that amounts to an
abdication of the director's duty to the corporation or its shareholders, or
(vi) approval of an unlawful dividend, distribution, stock repurchase or
redemption. This provision would generally absolve directors of personal
liability for negligence in the performance of duties, including gross
negligence.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or persons controlling the Company
pursuant to the foregoing provisions, the Company has been informed that in the
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opinion of the Securities and Exchange Commission, such indemnification is
against public policy as expressed in the Act and is therefore unenforceable.
BOARD COMMITTEES
The Board of Directors has appointed an Audit Committee. As of July 21,
2003, the sole member of the Audit Committee is Tom Djokovich. The Audit
Committee is authorized by the Board of Directors to review, with the Company's
independent accountants, the annual financial statements of the Company prior to
publication, and to review the work of, and approve non-audit services preformed
by, such independent accountants. The Audit Committee will make annual
recommendations to the Board for the appointment of independent public
accountants for the ensuing year. The Audit Committee will also review the
effectiveness of the financial and accounting functions and the organization,
operations and management of the Company. The Audit Committee was formed on
April 19, 2003. As of July 21, 2003, the Company has not yet appointed a
Compensation Committee.
Auditor Independence
General. Rose Snyder & Jacobs, CPAs ("RSJ") is the Company's principal
auditing accountant firm. RSJ has also provided other non-audit services to the
Company. The Audit Committee of the Company's Board of Directors has considered
whether the provisions of non-audit services is compatible with maintaining
RSJ's independence.
Audit Fees. RSJ billed the Company $20,000 for the following
professional services: audit of the annual financial statement of the Company
for the fiscal year ended June 30, 2002, and review of the interim financial
statements included in quarterly reports on Form 10-QSB for the periods ended
September 30, 2002, December 31, 2002, and March 31, 2003.
All Other Fees. RSJ billed the Company $3,000 for other services for
the fiscal year ended June 30, 2002.
Report of the Audit Committee
The Company's Audit Committee has reviewed and discussed the Company's
audited financial statements for the fiscal year ended June 30, 2002 with senior
management. The Audit Committee has discussed with RSJ, the Company's
independent auditors, the matters required to be discussed by the statement on
Auditing Standards No. 61 (communication with Audit Committees). The Audit
Committee has also received the written disclosures and the letter from RSJ
required by Independence Standards Board Standard No. 1 (Independence Discussion
with Audit Committees) and the Audit Committee has discussed with RSJ the
independence of RSJ as auditors of the Company. Based on the foregoing, the
Company's Audit Committee has recommended to the Board of Directors that the
audited financial statements of the Company be included in the Company's Annual
Report on Form 10-KSB for the fiscal year ended June 30, 2002 for filing with
the United States Securities and Exchange Commission. The Company's Audit
Committee did not submit a formal report regarding its findings.
Tom Djokovich
The Company's Audit Committee is comprised of one member, Tom
Djokovich, who is an independent director. Mr. Djokovich is independent because
he is not employed by the Company, does not participate in the day-to-day
management of the Company, and does not receive a salary or other employment
benefits from the Company.
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Notwithstanding anything to the contrary set forth in any of the
Company's previous or future filings under the United States Securities Act of
1933, as amended, or the Securities Exchange Act of 1934, as amended, that might
incorporate this report in future filings with the Securities and Exchange
Commission, in whole or in part, the foregoing report shall not be deemed to be
incorporated by reference into any such filing.
EXECUTIVE COMPENSATION
Summary Compensation Table
The following table and notes set forth the annual cash compensation
paid to Jonathan Lei, Chairman of the Board and President of the Company during
the fiscal years ended June 30, 2003, 2002, 2001, and 2000, respectively. No
other executive officer received compensation in excess of $100,000 in any such
year.
Long-Term
Compensation
Annual Compensation Awards
------------------- ------
Securities
Fiscal Other Annual Underlying All Other
Name and Principal Position Year Salary Bonus Compensation Options Compensation
--------------------------- ---- ------ ----- ------------ ------- ------------
Jonathan Lei..................... 2003 $138,000 - 0 - - 0 - -0- - 0 -
President, Chief Financial
Officer, and Secretary 2002 $138,000 - 0 - - 0 - - 0 -
2001 $138,000 - 0 - - 0 - - 0 -
2000 $138,000 - 0 - - 0 - - 0 -
Brian Fox........................ 2003 $145,000(1) - 0 - - 0 - 5,987,500(2) - 0 -
Chief Technology Officer
2002 $145,000 - 0 - - 0 - - 0 -
2001 $145,000 - 0 - - 0 - - 0 -
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(1) The Company has an at-will employment agreement with Mr. Fox providing
that upon a termination of his employment by the Company without cause
and only after $5,000,000 of venture or institutional capital has been
raised, Mr. Fox would be entitled to severance pay and continuing
health insurance for six months after termination, and vesting of those
of his unvested stock options that would vest during that six month
period.
(2) Consists of options granted under the Company's 2003 Stock Option Plan
on July 15, 2003. These stock options vest pursuant to the following
vesting schedule: 3,367,969 on July 15, 2003, then 1/21 per month until
all stock options have vested. Does not include 5,987,500 options to
purchase 5,987,500 shares of the Company's common stock from Jonathan
Lei, the President, Chief Financial Officer, Secretary, and Chairman of
the Company, for a purchase price of $0.08 per share (the "Lei
Options"), of which 4,490,625 are vested. The remaining Lei Options
vest monthly in equal increments over the next nine months.
Options Granted in Last Fiscal Year
The following table sets forth information with respect to options to
purchase common stock of the Company granted to the Company's executive officers
during fiscal year 2003 and through July 15, 2003.
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Potential Realizable
Value at Assumed
Annual Rates of Stock
Price Appreciation for
Option Term
-----------
Percent of Total
Options Granted to Exercise
Options Employees in Price Expiration
Name Granted Fiscal Year per Share Date 5% 10%
---- ------- ----------- --------- ---- -- ---
Brian Fox........... 5,987,000(1) 71.3% $0.08 Four years from $103,219 $222,285
Chief Technology the date of vesting
Officer
-----------
(1) These stock options vest pursuant to the following vesting schedule:
3,367,969 on July 15, 2003, then 1/21 per month until all stock options
have vested. Does not include 5,987,500 options to purchase 5,987,500
shares of the Company's common stock owned by Jonathan Lei, the
President, Chief Financial Officer, Secretary, and Chairman of the
Company, for a purchase price of $0.08 per share (the "Lei Options"),
of which 4,490,625 are vested. The remaining Lei Options vest monthly
in equal increments over the next nine months.
FISCAL YEAR-END OPTION EXERCISES AND OPTION VALUES
The following table sets forth information with respect to options to
purchase common stock of the Company held by the Company's executive officers at
July 15, 2003.
Number of Unexercised Value of Unexercised
Options Held at In-the-Money Options
July 15, 2003 at July 15, 2003(2)
------------- -------------------
Shares
Acquired
Name Upon Exercise Value Realized(1) Exercisable Unexercisable Exercisable Unexercisable
---- ------------- ---------------- ----------- ------------- ----------- -------------
Brian Fox............. -0- -0- 3,367,969 2,619,531 $740,953 $576,297
Chief Technology
Officer
-----------
(1) The value realized is the difference between the market price of the
common stock on the date of exercise and the exercise price of the
stock option.
(2) The value of unexercised "in-the-money" options is the difference
between the market price of the common stock on July 15, 2003 ($0.30
per share) and the exercise price of the option, multiplied by the
number of shares subject to the option.
EMPLOYMENT AGREEMENTS
The Company has not entered into any employment agreements with its
executive officers to date, other than the at-will employment agreement with
Brian Fox as described in footnote one under "EXECUTIVE COMPENSATION-Summary
-10-
Compensation Table." The Company may enter into employment agreements with them
in the future.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
None.
INDEPENDENT AUDITORS
Based upon the recommendation of the Audit Committee, the Board of
Directors has authorized the firm of Rose, Snyder & Jacobs, independent
certified public accountants, to serve as independent auditors for the fiscal
year ended June 30, 2003.
SHAREHOLDER PROPOSALS AND NOMINATING PROCEDURES
Any proposal that a shareholder intends to present at the Company's
2004 Annual Meeting should be received at the Company's principal executive
office no later than 120 days before the Company's next Annual Meeting which is
scheduled for November 7, 2004. Any such proposal must comply with Rule 14a-8 of
Regulation 14A of the proxy rules of the Securities and Exchange Commission.
Shareholder proposals should be addressed to the Secretary of the Company.
Nominations for directors to be elected at the 2004 Annual Meeting,
other than those made by the Board of Directors, should be submitted to the
Secretary of the Company no later than 120 days before the Company's next Annual
Meeting which is scheduled for November 7, 2004. The nomination should include
the full name of the nominee and a description of the nominee's background in
compliance with Regulation S-K of the reporting rules of the Securities and
Exchange Commission.
OTHER MATTERS
The Board of Directors of the Company is not aware that any matter
other than those described in this Information Statement is to be presented for
the consent of the shareholders.
UPON WRITTEN REQUEST BY ANY SHAREHOLDER TO JONATHAN LEI, SECRETARY OF
THE COMPANY, AT ROAMING MESSENGER, INC., 6144 CALLE REAL SUITE 200, SANTA
BARBARA, CALIFORNIA 93117, A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-KSB
WILL BE PROVIDED WITHOUT CHARGE.
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EXHIBIT A
STOCK OPTION PLAN FOR
ROAMING MESSENGER, INC.
ROAMING MESSENGER, INC.
STOCK OPTION PLAN
FOR DIRECTORS, EXECUTIVE OFFICERS, AND EMPLOYEES OF
AND KEY CONSULTANTS TO ROAMING MESSENGER, INC.
1. PURPOSE. The purpose of this Stock Option Plan is to promote the
interests of Roaming Messenger, Inc. ("Company") and its shareholders by
enabling it to offer stock options to better attract, retain, and reward
directors, executive officers, and employees of and key consultants to the
Company and any other future subsidiaries that may qualify under the terms of
this Plan. The goal is to strengthen the mutuality of interests between those
persons and the shareholders of the Company by providing those persons with a
proprietary interest in pursuing the Company's long-term growth and financial
success.
2. DEFINITIONS. For purposes of this Plan, the following terms shall
have the meanings set forth below.
(a) "Board" means the Board of Directors of Roaming Messenger, Inc.
(b) "Code" means the Internal Revenue Code of 1986, as amended.
Reference to any specific section of the Code shall be deemed to be a reference
to any successor provision of the Code.
(c) "Committee" means the administrative committee of this Plan that is
provided in Section 1 below.
(d) "Common Stock" means the common stock of the Company or any
security issued in substitution, exchange, or in lieu thereof.
(e) "Company" means Roaming Messenger, Inc., a Nevada corporation, or
any successor corporation. Except where the context indicates otherwise, the
term "Company" shall include its Parent and Subsidiaries.
(f) "Director" means any person who serves as a member of the Board of
Directors of Roaming Messenger, Inc. "Outside Director" means any person who
serves as a member of the Board of Directors of Roaming Messenger, Inc. and is
not a full-time employee of Roaming Messenger, Inc. or its subsidiaries.
(g) "Disabled" means permanent and total disability, as defined in Code
Section 22(e)(3).
(h) "Employee" means any person who is employed by Roaming Messenger,
Inc. or any Subsidiary or Parent of the Company on a full or part-time basis, so
that they have income taxes withheld and are eligible to participate in employee
benefits programs. Such person shall not cease to be an Employee in the case of
(i) any leave of absence approved by the Company or (ii) transfers between
locations of the Company or between the Company, its Parent, any Subsidiary, or
any successor. For purposes of Incentive Stock Options, no such leave may exceed
ninety days, unless re-employment upon expiration of such leave is guaranteed by
statute or contract. If employment upon expiration of leave of absence approved
by the Company is not so guaranteed, on the 181st day of such leave any
Incentive Stock Option held by the Optionee shall cease to be treated as an
Incentive Stock Option and shall be treated for tax purposes as a Non-Qualified
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Stock Option. Neither service as a Director nor payment of a director's fee by
the Company shall be sufficient to constitute "employment" by the Company.
(i) "Exchange Act" means the Securities Exchange Act of 1934.
(j) "Fair Market Value" per share means, on any given date:
(1) The last sale price of the Common Stock on the National
Association of Securities Dealers Automated Quotation National
Market System ("NMS") or in case no such reported sale takes
place, the average of the closing bid and ask prices on such
date; or
(2) If not quoted on the NMS, the average of the closing bid
and ask prices of the Common Stock on the National Association
of Securities Dealers Automated Quotation System ("NASDAQ") or
any comparable system; or
(3) If not quoted on any system, the fair market value
indicated by the last appraisal of the Company by a
professional appraiser or certified public accounting firm; or
(4) If not quoted on any system or valued by appraisal, the
fair market value determined by the Company's Board of
Directors in good faith.
(k) "Incentive Stock Option" means an option to purchase shares of
Common Stock that is intended to be an incentive stock option within the meaning
of Section 422 of the Code.
(l) "Insider" means a person who is subject to the provisions of
Section 16 of the Exchange Act.
(m) "Key Consultant" means a person who is engaged by Roaming
Messenger, Inc. or its Subsidiaries as a non-employee to perform tasks on a
contractual basis over a sufficient period of time that he or she satisfies the
eligibility criteria set forth by the Securities and Exchange Commission for a
non-employee to participate in a registered stock option plan.
(n) "Non-Qualified Stock Option" means any option to purchase shares of
Common Stock that is not an Incentive Stock Option.
(o) "Officer" is an employee of Roaming Messenger, Inc. or its
Subsidiaries who is granted the authority to commit the corporation to binding
agreements and to function as one of the executives of Roaming Messenger, Inc.
or its Subsidiaries.
(p) "Option" means an Incentive Stock Option or a Non-Qualified Stock
Option.
(q) "Parent" shall mean any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company if each of the
corporations (other than the Company) owns stock possessing fifty percent (50%)
or more of the total combined voting power of all classes of stock in one of the
other corporations in the chain, as determined in accordance with the rules of
Section 424(e) of the Code.
-2-
(r) "Participant" means a person who has been granted an Option.
(s) "Plan" means this Roaming Messenger, Inc. Stock Option Plan for
Directors, Executive Officers, and Employees of and Key Consultants to Roaming
Messenger, Inc. and its Subsidiaries, as it may be amended from time to time.
(t) "Securities Act" means the Securities Act of 1933, as amended.
(u) "Severance" means, with respect to a Participant, the termination
of the Participant's provision of services to the Company as an employee and
officer and director and consultant, as the case may be, whether by reason of
death, disability, or any other reason. A Participant who is on a leave of
absence that exceeds ninety (90) days will be considered to have incurred a
Severance on the ninety-first (91st) day of the leave of absence, unless the
Participant's rights to reemployment or reappointment are guaranteed by statute
or contract.
(v) "Subsidiary" means any corporation or entity in which the Company,
directly or indirectly, controls fifty percent (50%) or more of the total voting
power of all classes of its stock having voting power, as determined in
accordance with the rules of Code Section 424(f).
(w) "Ten Percent Shareholder" means any person who owns (after taking
into account the constructive ownership rules of Section 424(d) of the Code)
more than ten percent (10%) of the stock of the Company.
3. ADMINISTRATION.
(a) This Plan shall be administered by a Committee appointed by the
Board. The Board may remove members from, or add members to, the Committee at
any time.
(b) The Committee shall be composed of the members of the Compensation
Committee of the Company's Board of Directors and any other members that the
Board of Directors sees fit to appoint.
(c) The Committee may conduct its meetings in person or by telephone. A
majority of the members of the Committee shall constitute a quorum, and any
action shall constitute action of the Committee if it is authorized by:
(i) A majority of the members present at any meeting; or
(ii) The unanimous consent of all of the members in writing
without a meeting.
(d) The Committee is authorized to interpret this Plan and to adopt
rules and procedures relating to the administration of this Plan. All actions of
the Committee in connection with the interpretation and administration of this
Plan shall be binding upon all parties.
(e) The Committee may designate persons other than members of the
Committee to carry out its responsibilities under such conditions and
limitations as it may prescribe, except that the Committee may not delegate its
authority with regard to the granting of Options to Insiders.
(f) Subject to the limitations of Section 13 below, the Committee is
expressly authorized to make such modifications to this Plan as are necessary to
-3-
effectuate the intent of this Plan as a result of any changes in the tax,
accounting, or securities laws treatment of Participants and the Plan.
4. DURATION OF PLAN.
(a) This Plan shall be effective as of July 10, 2003, the date of its
adoption by the Board, provided this Plan is approved by the majority of the
Company's shareholders, in accordance with the provisions of Code Section 422,
on or prior to twelve (12) months after its adoption. In the event that this
Plan is not so approved, this Plan shall terminate and any Options granted under
this Plan shall be void and have no further effect.
(b) This Plan shall terminate on July 10, 2013, except with respect to
Options then outstanding.
5. NUMBER OF SHARES.
(a) The aggregate number of shares of Common Stock which may be issued
pursuant to this Plan shall be twenty five million (25,000,000) shares of Common
Stock. This aggregate number may be adjusted from time to time as set forth in
Section 13 of this Plan.
(b) Upon the expiration or termination of an outstanding Option which
shall not have been exercised in full, any shares of Common Stock remaining
unissued shall again become available for the granting of additional Options.
6. ELIGIBILITY. Persons eligible for Options under this Plan shall be
limited to the directors, executive officers, and employees of and key
consultants to Roaming Messenger, Inc. and its Subsidiaries.
7. FORM OF OPTIONS. Options granted under this Plan may be Incentive
Stock Options or Non-Qualified Stock Options. Options shall be subject to the
following terms and conditions:
(a) Options may be granted under this Plan on such terms and in such
form as the Committee may approve, including by not limited to the right to
exercise Options on a cashless basis, which conditions shall not be inconsistent
with the provisions of this Plan.
(b) The exercise price per share of Common Stock purchasable under an
Option shall be set forth in the Option. The exercise price of an option,
determined on the date of the grant, shall be no less than:
(i) One hundred ten percent (110%) of the Fair Market Value of
the Common Stock in the case of a Ten Percent Shareholder; or
(ii) One hundred percent (100%) of the Fair Market Value of
the Common Stock in the case of any other employee.
(c) An Option shall be exercisable at such time or times and be subject
to such terms and conditions as may be set forth in the Option. Except in the
case of Options granted to Officers, Directors, and Consultants, Options shall
become exercisable at a rate of no less than 20% per year over five (5) years
from the date the Options are granted.
(d) The Committee may modify an existing Option, including the right
to:
-4-
(i) Accelerate the right to exercise it;
(ii) Extend or renew it; or
(iii) Cancel it and issue a new Option.
(e) No modification may be made pursuant to Paragraph (d) above to an
Option that would impair the rights of the Participant holding the Option
without his or her consent. Whether a modification of an existing Incentive
Stock Option will be treated as the issuance of a new Incentive Stock Option
will be determined in accordance with the rules of Section 424(h) of the Code.
(f) Each Option shall be designated in the stock option agreement as
either an Incentive Stock Option or a Non-Qualified Stock Option. However,
notwithstanding such designation, to the extent that the aggregate Fair Market
Value (determined as of the date of grant) of the number of shares of Common
Stock with respect to which Incentive Stock Options are exercisable for the
first time by a Participant during any calendar year exceeds one hundred
thousand dollars ($100,000) or such other limit as may be required by Code
Section 422, such Options shall be treated as Non-Qualified Stock Options. In
the event the stock option agreement does not designate an Option as either an
Incentive Stock Option or a Non-Qualified Stock Option, such Option shall be
treated as an Incentive Stock Option to the extent that the aggregate Fair
Market Value (determined as of the date of grant) of the number of shares of
Common Stock with respect to which such Option is exercisable for the first time
by a Participant during any calendar year does not exceed one hundred thousand
dollars ($100,000) or such other limit as may be required by Code Section 422.
8. ISSUANCE OF OPTIONS.
Stock Options will be granted from time to time in the future on the
terms and conditions recommended by the Committee and approved by the Company's
Board of Directors. Each Option shall be evidenced by a written stock option
agreement, in form satisfactory to the Committee, executed by the Company and
the person to whom such Option is granted. The stock option agreement shall
specify whether each Option it evidences is a Non-Qualified Stock Option or an
Incentive Stock Option.
9. VESTING REQUIREMENT AND PERFORMANCE THRESHOLD.
The vesting requirements, performance thresholds and other terms and
conditions of additional Options which may be granted under this Plan from time
to time, if any, will be determined and approved by the Committee and Board of
Directors; provided, that in all cases unvested Options will automatically
expire and be canceled on the date of the Severance of an Employee or Insider
who holds such Options.
10. TERMINATION OF OPTIONS.
(a) Except to the extent the terms of an Option require its prior
termination, each Option shall terminate on the earliest of the following dates.
(i) The date which is ten (10) years from the date on which
the Option is granted or five (5) years from the date of grant
in the case of an Incentive Stock Option granted to a Ten
Percent Shareholder.
-5-
(ii) If the Participant was Disabled at the time of Severance,
the date of the Severance of the Participant to whom the
Option was granted, with respect to unvested Options, and the
date which is one (1) year from the date of the Severance,
with respect to vested Options.
(iii) The date of Severance of the Participant to whom the
Option was granted, with respect to unvested Options, and the
date which is ninety (90) days from the date of the Severance
of the Participant to whom the Option was granted, with
respect to vested Options.
(iv) The date which is ninety (90) days after the death of the
Participant, with respect to vested Options, and the date of
death of the Participant, in the case of unvested Options.
(v) In the case of any Severance other than one described in
Subparagraphs (ii) or (iii) above, the date of the
Participant's Severance, with respect to unvested Options, and
the date that is ninety (90) days from the date of the
Participant's Severance, with respect to vested Options.
11. NON-TRANSFERABILITY OF OPTIONS.
(a) During the lifetime of the Participant, each Option is exercisable
only by the Participant.
(b) No Option under this Plan shall be assignable or transferable,
except by will or the laws of descent and distribution.
12. ADJUSTMENTS.
(a) In the event of any change in the capitalization of the Company
affecting its Common Stock (e.g., a stock split, reverse stock split, stock
dividend, combination, recapitalization, or reclassification), the Committee
shall authorize such adjustments as it may deem appropriate with respect to:
(i) The aggregate number of shares of Common Stock for which
Options may be granted under this Plan;
(ii) The number of shares of Common Stock covered by each
outstanding Option; and
(iii) The exercise price per share in respect of each
outstanding Option.
(b) The Committee may also make such adjustments in the event of a
spin-off or other distribution (other than normal cash dividends) of Company
assets to shareholders.
13. Amendment and Termination. The Board may at any time amend or
terminate this Plan. The Board may not, however, without the approval of the
majority-in-interest of the shareholders of the Company, amend the provisions of
this Plan regarding:
(a) The class of individuals entitled to receive Incentive Stock
Options.
-6-
(b) The aggregate number of shares of Common Stock that may be issued
under the Plan, except as provided in Section 12 of this Plan.
(c) To the extent necessary to comply with Rule 16(b) under the
Exchange Act, the Board may not make any amendment without approval of the
majority-in-interest of the shareholders of the Company that would:
(i) Materially increase the aggregate number of shares of
Common Stock which may be issued to Insiders (except for
adjustments under Section 12 of this Plan);
(ii) Materially modify the requirements as to the eligibility
of Insiders to participate; or
(iii) Materially increase the benefits accruing to Insiders
under this Plan.
14. TAX WITHHOLDING.
(a) The Company shall have the right to take such actions as may be
necessary to satisfy its tax withholding obligations relating to the operation
of this Plan.
(b) If Common Stock is used to satisfy the Company's tax withholding
obligations, the stock shall be valued based on its Fair Market Value when the
tax withholding is required to be made.
15. NO ADDITIONAL RIGHTS.
(a) The existence of this Plan and the Options granted hereunder shall
not affect or restrict in any way the power of the Company to undertake any
corporate action otherwise permitted under applicable law.
(b) Neither the adoption of this Plan nor the granting of any Option
shall confer upon any Participant the right to continue performing services for
the Company, nor shall it interfere in any way with the right of the Company to
terminate the services of any Participant at any time, with or without cause.
(c) No Participant shall have any rights as a shareholder with respect
to any shares covered by an Option until the date a certificate for such shares
has been issued to the Participant following the exercise of the Option.
16. SECURITIES LAW RESTRICTIONS.
(a) No shares of Common Stock shall be issued under this Plan unless
the Committee shall be satisfied that the issuance will be in compliance with
applicable federal and state securities laws.
(b) The Committee may require certain investment or other
representations and undertakings by the Participant (or other person acquiring
the right to exercise the Option by reason of the death of the Participant) in
order to comply with applicable law.
-7-
(c) Certificates for shares of Common Stock delivered under this Plan
may be subject to such restrictions as the Committee may deem advisable. The
Committee may cause a legend to be placed on the certificates to refer to these
restrictions.
17. EMPLOYMENT OR CONSULTING RELATIONSHIP. Nothing in the Plan or any
Option granted hereunder shall interfere with or limit in any way the right of
the Company or any of its Parents or Subsidiaries to terminate any Participant's
employment or consulting at any time, nor confer upon any Participant any right
to continue in the employ of, or consult with, the Company or any of its Parents
or Subsidiaries.
18. MARKET STANDOFF. Each Participant, if so requested by the Company
or any representative of the underwriters in connection with any registration of
the offering of any securities of the Company under the Securities Act, shall
not sell or otherwise transfer any shares of Common Stock acquired upon exercise
of Options during a specified period following the effective date of a
registration statement of the Company filed under the Securities Act not to
exceed six months; provided, however, that such restriction shall apply only to
the first registration statement of the Company to become effective under the
Securities Act after the date of adoption of the Plan which includes securities
to be sold on behalf of the Company to the public in an underwritten public
offering under the Securities Act. The Company may impose stop-transfer
instructions with respect to securities subject to the foregoing restriction
until the end of such six month period.
19. SHAREHOLDER'S AGREEMENT. Each Participant who acquires Common Stock
through the exercise of Options, if so requested by the Company, shall execute a
Shareholder's Agreement which provides for the disposition of the Common Stock
in the event the Participant seeks to dispose of his Common Stock or incurs a
Severance.
20. INDEMNIFICATION. To the maximum extent permitted by law, the
Company shall indemnify each member of the Board and of the Committee, as well
as any other Employee of or Key Consultant to the Company with duties under this
Plan, against expenses (including any amount paid in settlement) reasonably
incurred by him or her in connection with any claims against him or her by
reason of the performance of his or her duties under this Plan, unless the
losses are due to the individual's gross negligence or lack of good faith.
21. GOVERNING LAW. This Plan and all actions taken thereunder shall be
governed by and construed in accordance with the laws of the State of
California. The venue for any legal proceeding under this Plan will be in the
appropriate forum in the County of Ventura, State of California.
Date: July 10, 2003 Roaming Messenger, Inc.,
a Nevada Corporation
By:/s/Jonathan Lei
________________________
Jonathan Lei, President
EXHIBIT B
STOCK OPTION AGREEMENT FOR
ROAMING MESSENGER, INC.
STOCK OPTION AGREEMENT UNDER THE
ROAMING MESSENGER, INC.
STOCK OPTION PLAN
This Stock Option Agreement (the "Agreement") is dated as of ______ by
and between Roaming Messenger, Inc., a Nevada corporation (the "Company"), and
_____________ (the "Optionee") pursuant to the Company's 2003 Stock Option Plan
for Directors, Executive Officers, Employees and Key Consultants of Roaming
Messenger, Inc. and its Subsidiaries (the "Plan"). For purposes of this
Agreement, references to "Company" include its Parent and Subsidiaries (as those
terms are defined in the Plan).
Pursuant to authorization by the Committee of the Plan (the
"Committee") appointed by the Board of Directors of the Company, the parties
agree as follows:
1. GRANT OF OPTION.
The Company hereby grants to the Optionee the right (the "Option") to
purchase all or any portion of ________________ (_______________) shares (the
"Shares") of the Common Stock of the Company (the "Common Stock") at a purchase
price of $______ per share (the "Option Price").
2. TERM OF AGREEMENT.
This Agreement shall terminate upon the earliest of the following
events:
(a) _____ years from the date of vesting of the last Options
to vest pursuant to this Agreement, but no longer than ten (10) years
from the date of grant of the Option.
(b) In the case of the termination of the Optionee's position
as an officer and director and employee and consultant of the Company,
as the case may be, which results in a "Severance" as defined in
Section 2(t) of the Plan, this Agreement shall terminate with respect
to all unvested Options on the date of the Severance, and with respect
to vested Options, the earlier of (i) _____ years from the date of
vesting, but no longer than ten (10) years from the date of grant of
the Option or (ii) one (1) year from the date of Severance if the
Optionee was disabled (within the meaning of Section 22(e)(3) of the
Internal Revenue Code) at the time of his or her Severance, or (iii)
ninety (90) days immediately subsequent to his or her Severance for any
reason.
(c) The Optionee's Severance (whether by reason of death or
otherwise) shall not accelerate the number of Shares with respect to
which an Option may be exercised.
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3. EXERCISABILITY. The Option shall vest and be exercisable in
accordance with the following schedule:
Name of Grantee Date of Number of Vesting Exercise Expiration
Grant Options Schedule Price Date
--------------- -------- --------- -------- --------- ----------
--------------------------------------------
(1) The exercise price is equal to the fair market value on the date of the
issuance of the options. Each stock option will confer upon the holder
the right to purchase one share of the Company's common stock for a
price of $____ per share at any time from the vesting date to the
expiration date.
4. METHOD OF EXERCISING. This Option may be exercised by the Optionee
upon delivery of the following documents to the Company at its principal
executive offices:
(a) Written notice specifying the number of full Shares to be
purchased;
(b) Payment of the full purchase price therefor in cash, by
check, or in such other form of lawful consideration as the Committee
may approve from time to time;
(c) Such agreements or undertakings that are required by the
Committee pursuant to the Plan; and
(d) Payment of any taxes which may be required.
5. ASSIGNMENTS.
(a) This Option shall be exercisable only by the Optionee
during the Optionee's lifetime.
(b) The rights of the Optionee under this Agreement may not be
assigned or transferred except by will or by the laws of descent and
distribution.
6. NO RIGHTS AS A SHAREHOLDER. The Optionee shall have no rights as a
shareholder of any Shares covered by this Option until the date a certificate
for such Shares has been issued to him or her following the exercise of the
Option.
7. INTERPRETATION OF AGREEMENT.
(a) This Agreement is made under the provisions of the Plan
and shall be interpreted in a manner consistent with it.
(b) Any provision in this Agreement inconsistent with the Plan
shall be superseded and governed by the Plan. A copy of the Plan is
attached hereto as Exhibit A.
8. LEGENDS ON CERTIFICATES. The Optionee acknowledges that the
certificates representing the Shares issued upon exercise of this Option may
bear such legends and be subject
-2-
to such restrictions on transfer as the Company may deem necessary to comply
with all applicable state and federal securities laws and regulations.
9. MARKET STANDOFF. The Optionee, if so requested by the Company or any
representative of the underwriters in connection with any registration of the
offering of any securities of the Company under the Securities Act of 1933, as
amended (the "Act"), shall not sell or otherwise transfer any shares of Common
Stock acquired upon the exercise of the Option granted herein during the six
month period following the effective date of a registration statement of the
Company filed under the Act; provided, however, that such restriction shall only
apply to the first registration statement of the Company to become effective
under the Act after the date of adoption of the Plan which includes securities
to be sold on behalf of the Company to the public in an underwritten public
offering under the Act. The Company may impose stop-transfer instructions with
respect to securities subject to the foregoing restriction until the end of such
six month period.
10. INCENTIVE STOCK OPTION. To the extent permitted under Section 422
of the Internal Revenue Code of 1986, as amended, the stock options granted
under this Agreement shall be designated as Incentive Stock Options, as that
term is defined in the Plan. To the extent any stock options granted under this
Agreement may not be designated as Incentive Stock Options, such stock options
shall be designated as non-qualified stock options.
11. NOTICES. Any notice to be given under the terms of this Agreement
must be addressed to the Company in care of its Secretary at its principal
office, and any notice to be given to Optionee must be addressed to such
Optionee at the address maintained by the Company for such person or at such
other address as the Optionee may specify in writing to the Company.
12. BINDING EFFECT. This Agreement and any amendment hereto, will be
binding upon the parties hereto, their successors, heirs, next of kin,
executors, administrators, personal representatives, legal representatives,
assignees, creditors, including receivers, and all other persons with notice or
knowledge of the provisions hereof.
13. CHOICE OF LAW AND VENUE. This Agreement is made and entered into in
the State of California. It is the intention of the parties that this Agreement
will be subject to and will be governed by and construed in accordance with the
internal laws of the State of California without reference to its choice of law
provisions. Any legal proceeding arising out of this Agreement will be brought
only in a state of federal court of competent jurisdiction sitting in the County
of San Diego, State of California, and all parties hereto agree that venue will
lie therein and agree to submit themselves to the personal jurisdiction of such
court.
14. CONSTRUCTION. The captions contained in this Agreement are for
convenience of reference only and are not to be considered in construing this
Agreement. The language of this Agreement will be construed as to its fair
meaning and not strictly for or against any party.
15. SEVERABILITY. The provisions of this Agreement are independent of
and severable from each other, and no provision will be affected or rendered
invalid or unenforceable by virtue of the fact that for any reason any other or
others of them may be invalid or unenforceable in whole or in part. Further, if
a court of competent jurisdiction determines that any provision of this
Agreement is invalid or unenforceable as written, such court may interpret,
construe, rewrite or revise such provision, to the fullest extent allowed by
law, so as to make it valid and enforceable consistent with the intent of the
parties hereto.
16. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which will be deemed to be an original as against any
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party hereto whose signature appears hereon, and all of which will together
constitute one and the same instrument. This Agreement will become binding when
one or more counterparts hereof, individually or taken together, bears the
signatures of all of the parties reflected hereon as the signatories.
17. APPLICATION OF PLAN. The Company has delivered and the Optionee
hereby acknowledges receipt of a copy of the Plan. The parties agree and
acknowledge that the Option granted hereunder is granted pursuant to the Plan
and subject to the terms and provisions thereof, and the rights of the Optionee
are subject to modifications and termination in certain events as provided in
the Plan.
IN WITNESS WHEREOF, the Company and the Optionee have executed this
Agreement as of the date first above written.
OPTIONEE: ______________________ ROAMING MESSENGER, INC.
By: By:
----------------------------- -----------------------------
Jonathan Lei, President
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EXHIBIT A
ROAMING MESSENGER, INC.
2003 STOCK OPTION PLAN