Exhibit 10.3
BLONDER TONGUE LABORATORIES, INC.
2005 EMPLOYEE EQUITY INCENTIVE PLAN
INCENTIVE STOCK OPTION AGREEMENT
THIS AGREEMENT is made and entered into as of this _________ day of
__________________, 2005, by and between BLONDER TONGUE LABORATORIES, INC. a
Delaware corporation (the "Company"), and __________________ ("Optionee").
Background
The Optionee is a key employee of the Company's and possesses knowledge,
experience and skill necessary for the Company's future growth and success. The
Company has adopted the Blonder Tongue Laboratories, Inc. 2005 Employee Equity
Incentive Plan (the "Plan"). Pursuant to and in accordance with the Plan, the
Company desires to grant to the Optionee an incentive stock option as defined in
Section 422 of the Internal Revenue Code of 1986, as amended, to purchase shares
of the Company's Common Stock as more fully set forth below. Capitalized terms
used in this Agreement and not otherwise defined herein, shall have the meanings
ascribed to them in the Plan.
NOW, THEREFORE, in consideration of the premises and the covenants
contained herein, and intending to be legally bound, it is agreed as follows:
1. Option to Purchase Shares. The Company hereby grants to the Optionee an
Option (the "Option"), pursuant to the Plan, but subject to the Plan's approval
by the stockholders of the Company within 12 months of the adoption of the Plan,
to purchase up to ______________________________________________ shares of the
Company's Common Stock (the "Stock"). The Option Price for each share of Stock
shall be ________________________________________, which is acknowledged to be
at least 100% of the Fair Market Value (defined in the Plan) of each share of
Stock as of the date hereof (or at least 110% of such Fair Market Value if the
Optionee owns, or is deemed to own pursuant to Section 424(d) of the Code, more
than 10% of the total combined voting power of all classes of stock of the
Company). The Option shall be exercisable for the number of shares of Stock and
during the specific exercise periods ("Exercise Period(s)") set forth in the
following table:
Number of Shares Exercise Period
___________________ ___________________________
2. Manner of Exercise and Terms of Payment. The Option may be exercised in
whole or in part, subject to the limitations set forth in this Agreement, upon
delivery to the Company of timely written notice of exercise, accompanied by
full payment of the Option Price for the shares of Stock with respect to which
the Option is exercised. Full payment shall be in cash or, if and as permitted
by the Committee in its sole discretion: (i) by the Optionee's note payable over
such period of time, at such rate of interest and in form and substance
satisfactory to the Committee; (ii) by tendering stock of the Company; or (iii)
by withholding stock subject to the Option, all as provided in the Plan.
3. Termination of Option.
(a) Expiration or Termination of Employment. Except as specifically
provided in Section 3(b) and 3(c) hereof, the Option granted hereunder
shall terminate as of the close of business on the earliest to occur of the
date of (i) expiration of the Exercise Period, (ii) an event of default or
breach by the Optionee of the terms and conditions of this Agreement, or
(iii) termination of the Optionee's employment with the Company for cause.
If the Optionee's employment is terminated other than for cause, death (as
provided in subsection (b) below), or retirement or disability (both as
provided in subsection (c) below), the Optionee must exercise his Option,
if at all and to the extent then exercisable, within 30 days from the date
of such termination, in accordance with the terms of the Plan and this
Agreement.
(b) Death of Optionee. If the Optionee dies prior to the exercise of
the Option in full, the Option may be exercised by the Optionee's
executors, administrators or heirs within one year after the date of the
Optionee's death, provided death occurred during the Optionee's employment
with the Company, or within three months following the termination of the
Optionee's employment with the Company, by reason of the Optionee's
retirement after reaching the age of 65 years or the Optionee's retirement
after becoming permanently disabled. Such Option may be so exercised by the
Optionee's executors, administrators or heirs only with respect to that
number of shares of Stock which the Optionee had an Option to purchase and
only to the extent that the Option was exercisable (but had not theretofore
been exercised) as of the date of the earlier of the (i) retirement of the
Optionee after reaching the age of 65 years or after becoming permanently
disabled, or (ii) death of the Optionee. In no event may the Option be
exercised at any time after the expiration of the Exercise Period stated in
Section 1 hereof.
(c) Retirement or Disability. If the Optionee's employment with the
Company is terminated, prior to the exercise of the Option in full, by
reason of the Optionee's retirement after reaching the age of 65 years or
by reason of the Optionee's retirement after becoming permanently disabled,
the Optionee shall have the right, during the period ending three months
after the date of the Optionee's termination of employment, to exercise the
Option to the extent that it was exercisable but not exercised at the date
of the Optionee's termination of employment with the Company. Such Option
may be so exercised by the Optionee only with respect to that number of
shares of Stock which the Optionee had an Option to purchase and only to
the extent that the Option was exercisable (but had not theretofore been
exercised) as of the date that the Optionee retires after reaching the age
of 65 years or after becoming permanently disabled. In no event may the
Option be exercised at any time after the expiration of the Exercise Period
stated in Section 1 hereof.
4. Rights as Shareholder. An Optionee or permitted transferee of an Option
shall have no rights as a shareholder of the Company with respect to any shares
of Stock subject to such Option prior to the Optionee's purchase of such shares
of Stock by exercise of such Option as provided in the Plan.
5. Delivery of Stock Certificates. The Company shall not be required to
issue or deliver any certificate for shares of Stock purchased upon the exercise
of all or any portion of an Option granted under the Plan prior to the
fulfillment of any of the following conditions which may, from time to time, be
applicable to the issuance of the Stock:
(a) Listing of Shares. The admission of such shares of Stock to
listing on all stock exchanges on which the Stock of the Company is then
listed.
(b) Registration and/or Qualification of Shares. The completion of any
registration or other qualification of such shares of Stock under any
federal or state securities laws or under the regulations promulgated by
the Securities and Exchange Commission or any other federal or state
governmental regulatory body which the Board or Committee, as the case may
be, deems necessary or advisable. The Company shall in no event be
obligated to register any securities pursuant to the Securities Act of 1933
(as now in effect or as hereafter amended) or to take any other action in
order to cause the issuance and delivery of such certificates to comply
with any such law, regulations or requirement.
(c) Approval or Clearance. The obtaining of any approval or clearance
from any federal or state governmental agency which the Board or Committee,
as the case may be, shall determine to be necessary or advisable.
(d) Reasonable Lapse of Time. The lapse of such reasonable period of
time following the exercise of the Option as the Board or Committee, as the
case may be, may establish from time to time for reasons of administrative
convenience.
6. (a) Anti-Dilution. Except as otherwise expressly provided herein, if the
outstanding shares of Common Stock are hereafter changed or converted into, or
exchanged or exchangeable for, a different number or kind of shares or other
securities of the Company or of another corporation by reason of a
reorganization, merger, consolidation, recapitalization, reclassification or
combination of shares, stock dividend stock split or reverse stock split,
appropriate adjustment shall be made by the Board of Directors in the number of
shares and kind of stock subject to unexercised stock options hereunder, to the
end that the proportionate interest of the Optionee shall be maintained as
before the occurrence of such event.
(b) Non-survival of Company. In the event of a dissolution or
liquidation of the Company or any merger or combination in which the
Company is not a surviving corporation, each outstanding Option granted
hereunder shall terminate, but the Optionee shall have the right,
immediately prior to such liquidation, dissolution, merger or combination,
to exercise the Option, in whole or in part, to the extent that such Option
is then otherwise exercisable and has not previously been exercised,
provided, however, that no adjustment shall be made to an incentive stock
option which would constitute a "modification" of such Option, as such term
is defined in Section 424(h)(3) of the Code.
(c) Change in Control. In the event of any contemplated transaction
which may constitute a change in control of the Company, the Board of
Directors may modify the Option granted hereunder, so as to accelerate, as
a consequence of or in connection with such transaction, the vesting of the
Optionee's right to exercise such Option. For this purpose, "change in
control of the Company" means a change in control of such nature that it
would be required to be reported to the Securities and Exchange Commission
pursuant to Schedule 14A of Regulation 14A or any successor provision
(whether or not the Company is then subject to such reporting
requirements). A change of control will be deemed to have occurred if any
person, other than persons or entities who on the date hereof are the
"beneficial owners" (as determined pursuant to Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934), directly or indirectly, of securities
of the Company representing 10% or more of the combined voting power of the
Company's then outstanding securities, is or becomes the "beneficial owner"
of 25% or more of the combined voting power of the outstanding securities
of the Company or if during two consecutive year periods, the directors at
the beginning of such periods cease for any reason during the two-year
period to constitute a majority of the Board of Directors of the Company.
7. Tax Attributes. The incentive stock option granted pursuant to this
Agreement is intended to qualify under Section 422 of the Code and any
provisions hereof which would prevent such Options from qualifying are invalid
and of no effect, except as provided in Section 7.2(b) of the Plan. The Optionee
will promptly give written notice to the Company of any sale, exchange, gift, or
other transaction of any shares of Stock acquired pursuant to such incentive
stock option which occurs within two years of the date of grant of such Option
or within one year after the issuance of any shares of Stock pursuant thereto.
8. Agreement Subject to Plan. No term or condition of this Agreement shall
be construed or interpreted in a manner contrary to the purposes and provisions
of the Plan, a copy of which may be obtained from the Secretary of the Company.
Any question of interpretation arising under the Plan or this Agreement shall be
resolved by the Committee.
9. Restrictions on Transfers. No Option granted pursuant to the Plan may be
transferred by an Optionee. Subject to the provisions of Section 3(b) hereto,
the Option shall be exercisable only by an Optionee during his lifetime.
10. Miscellaneous.
(a) The Company reserves the right to terminate at any time, by
written notice to the Optionee, any or all of the restrictions on the Stock
set forth in this Agreement. Such termination shall be effective upon the
Optionee's receipt of such notice.
(b) All notices provided for or contemplated herein shall be addressed
as follows:
If to the Company: Blonder Tongue Laboratories, Inc.
Xxx Xxxx Xxxxx Xxxx
Xxx Xxxxxx, Xxx Xxxxxx 00000
Attn.: Chairman of Compensation Committee
If to the Optionee: __________________
__________________
or to such other addresses as the parties may specify in writing.
(c) Whenever Federal, state and local tax is due on the exercise of
Options granted under this Agreement, the Company may require the Optionee
or Participant to remit an amount sufficient to satisfy Federal, state and
local withholding taxes prior to the delivery of any certificate for such
shares or the lapse of restrictions.
(d) This Agreement does not confer upon or give to the Optionee any
right to continued employment by the Company and does not in any way affect
the right of the Company to terminate the Optionee's employment at any
time.
(e) This Agreement shall be construed in accordance with the laws of
the State of Delaware.
IN WITNESS WHEREOF, the undersigned have executed, or have caused this
Agreement to be executed, as of the day and year first above written.
BLONDER TONGUE LABORATORIES, INC. OPTIONEE
By:_____________________________________ __________________________________
Xxxxx X. Xxxxxx, Chief Executive Officer
