Exhibit 10.5
XXXXXXXXXXXXXXX.XXX, INC.
1999 EQUITY INCENTIVE PLAN
AWARD AGREEMENT FOR INCENTIVE STOCK OPTION
THIS AWARD AGREEMENT (the "Agreement") is made and entered into
effective as of the ____ day of __________________ _____, by and between
xxxxxxxxxxxxxxx.xxx, inc., a Delaware corporation (the "Company"), and
_________________, an Employee of the Company or of an Affiliate (the
"Optionholder"), pursuant to the xxxxxxxxxxxxxxx.xxx, inc. 1999 Equity Incentive
Plan, as it may be amended and restated from time to time (the "Plan").
Capitalized terms used but not defined herein shall have the meanings set forth
in the Plan.
W I T N E S S E T H:
WHEREAS, the Optionholder is an Employee of the Company or an
Affiliate; and
WHEREAS, the Company has granted, subject to the execution of this
Agreement, and the Optionholder desires to receive, an Award pursuant to the
Plan.
NOW, THEREFORE, for and in consideration of the premises, the mutual
promises and covenants herein contained, and other good and valuable
consideration, the receipt, adequacy and sufficiency of which are hereby
acknowledged, the parties hereto do hereby agree as follows:
1. GRANT OF AWARD. Subject to the execution of this Agreement, the
Company has granted to the Optionholder an Award in the form of the right and
option (the "Option") to purchase from the Company such number of whole shares
of Common Stock of the Company as is set forth on Exhibit A hereto from the
authorized and unissued Common Stock of the Company, or from the treasury stock
of the Company, at and for the Exercise Price set forth on Exhibit A attached
hereto. This Option is intended to be an Incentive Stock Option under the Plan.
2. HOW OPTIONS MAY BE EXERCISED. The Option shall be exercised by
delivery to the Company at its principal office of written notice of the
Optionholder's intent to exercise the Option with respect to the number of
shares of Common Stock then being purchased, accompanied by payment in full to
the Company of the amount of the Exercise Price for the number of shares of
Common Stock then being purchased. The Exercise Price shall be payable to the
Company (a) in cash or its equivalent, or (b) if the Board, in its discretion,
has approved such consideration prior to the exercise of the Option, (i) by
delivery to the Company of other Common Stock of the Company, (ii) according to
a deferred payment or other arrangement acceptable to the Board, (iii) pursuant
to a Cashless Exercise, (iv) in any other form of legal consideration that may
be acceptable to the Board, or (v) by a combination of the foregoing forms of
consideration; PROVIDED, HOWEVER, that at any time the Company is incorporated
in Delaware, payment of the Common Stock's par value shall not be made by
deferred payment.
3. CONDITIONS FOR EXERCISE OF OPTIONS. The Option may be exercised and
Common Stock
may be purchased by the Optionholder as the result of such exercise only during
the term or terms set forth on Exhibit A attached hereto; provided, however,
that in no event shall the total number of shares of Common Stock purchased
hereunder pursuant to the exercise of the Option exceed the number set forth on
Exhibit A attached hereto, as the same may be adjusted in accordance with the
Plan, and in no event shall the period for exercising the Option exceed ten (10)
years from the date of the grant of the Option. Exercise of the Option is
subject to the following additional terms and conditions:
(a) If the Optionholder is not a party to the Stockholders
Agreement at the time the Optionholder gives written notice of intent to
exercise in accordance with paragraph 2 above, then the Optionholder may not,
prior to the Effective Date, exercise the Option unless the Optionholder
contemporaneously with giving of such notice becomes a party to the Stockholders
Agreement.
(b) In the event the Continuous Service of the Optionholder
shall be terminated for any reason other than for death or Disability, the
Option may be exercised at any time after such termination and before the
earlier of (i) three (3) months following the termination of the Optionholder's
Continuous Service and (ii) the expiration date of the Option; PROVIDED,
HOWEVER, that if the Board determines that the exercise of the Option following
the termination of the Optionholder's Continuous Service would be prohibited at
any time solely because the issuance of shares of Common Stock would violate the
registration requirements under the Securities Act, then the Option shall
terminate on the earlier of (i) the expiration date of the Option or (ii) the
passage of an aggregate of one hundred twenty (120) days after the termination
of the Optionholder's Continuous Service during which the exercise of the Option
would not be in violation of such registration requirements.
(c) If the Continuous Service of the Optionholder shall be
terminated by reason of Disability, the Option may be exercised at any time
after such termination and before the earlier of (i) twelve (12) months and (ii)
the expiration date of the Option.
(d) If the Continuous Service of the Optionholder shall be
terminated by reason of the death of the Optionholder, or the Optionholder dies
within the periods specified in subsections 3(b) or (c) above relating to
exercise of the Option following termination of the Optionholder's Continuous
Service for reasons other than death, then the executor or administrator of the
estate of the Optionholder, or other allowable transferee, shall have the right
to exercise the Option at any time after such termination and before the earlier
of (i) eighteen (18) months and (ii) the expiration date of the Option.
(e) Notwithstanding any other provision hereof, in no event
may the Option be exercised at any time after termination of Continuous Service
with respect to any number of shares of Common Stock in excess of the number of
shares of Common Stock as to which the Option was exercisable at the time of
termination of Continuous Service.
4. ISSUANCE OF CERTIFICATE. In case of any exercise of the Option, this
Agreement, accompanied by payment of the full purchase price for the shares of
Common Stock then being purchased as provided in Paragraph 2 above, shall be
surrendered to the Company. The Company will thereupon cause to be issued and
delivered to the Optionholder as soon as reasonably may be done in accordance
with the terms of the Plan, a certificate or certificates representing the
shares of Common Stock so purchased and fully paid for. In the event of a
partial exercise, the Company will endorse on Exhibit B hereto the fact that the
Option has been partially exercised on such date, setting forth the extent of
such exercise, and return this Agreement to the Optionholder.
5. NON-TRANSFERABILITY OF OPTION. The Option is personal to the
Optionholder and may not in any manner or respect be assigned or transferred
otherwise than by will or the laws of descent and distribution, and is
exercisable during the Optionholder's lifetime only by the Optionholder. The
Optionholder may, by delivering written notice to the Company, designate a third
party who, in the event of the Optionholder's death, shall thereafter be
entitled to exercise the Option. To the extent the Option is not exercised, the
shares of Common Stock covered hereby shall be considered released to the
Company.
6. SUBJECT TO TERMS OF PLAN. The Option is in all respects subject to,
and shall be governed and determined by, the provisions of the Plan (all of the
terms of which are incorporated herein by reference) and to any rules which
might be adopted by the Board or the Committee with respect thereto to the same
extent and with the same effect as if set forth fully herein.
7. TERMINATION OF OPTION. This Agreement shall terminate no later than
ten (10) years from the date of grant of the Option.
8. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware, applied without giving effect
to any conflict-of-law principles. The invalidity or unenforceability of any
particular provision of this Agreement shall not affect the other provisions
hereof, and this Agreement shall be construed in all respects as if such invalid
or unenforceable provisions were omitted.
9. BINDING EFFECT. This Agreement shall be binding upon and shall inure
to the benefit of each of the parties hereto and their respective executors,
administrators, personal representatives, legal representatives, heirs, and
successors in interest.
10. COUNTERPARTS. This Agreement may be executed in counterparts, each
of which shall be considered an original, and such counterparts shall, together,
constitute and be one and the same instrument.
11. INVESTMENT PURPOSES. Upon request by the Company, the Optionholder
agrees to deliver to the Company at the time of any complete or partial exercise
of this Option a written representation that the shares of Common Stock being
acquired upon such exercise are being acquired for investment and not for resale
or with a view to the distribution thereof. Upon such request, delivery of such
written representation prior to the expiration of the Option period shall be a
condition precedent to the right of the Optionholder or any other persons to
purchase Common Stock hereunder and the Company's obligation to issue Common
Stock hereunder.
12. WITHHOLDING. The Company shall have the power and the right to
deduct or withhold, or require the Optionholder to remit to the Company, an
amount sufficient to satisfy federal, state and local taxes (including the
Optionholder's FICA obligation) required by law to be withheld with respect to
any taxable event arising as a result of the grant or exercise of the Option.
With respect to withholding required upon the exercise of the Option, the
Optionholder may elect, subject to the approval of the Board, to satisfy the
withholding requirement, in whole or in part, (i) by having the Company withhold
shares of Common Stock
having a Fair Market Value on the date as of which the tax is to be determined
equal to the minimum statutory total tax which could be imposed on the
transaction, or (ii) delivering to the Company owned and unencumbered shares of
Common Stock having such value. All such elections shall be irrevocable, made in
writing, signed by the Optionholder, and subject to any restrictions or
limitations that the Board, in its sole discretion, deems appropriate.
14. NO EFFECT ON EMPLOYMENT. This Agreement shall not be deemed to
confer upon Optionholder any right to continue Optionholder's employment by the
Company, and the Company may terminate such employment at any time for any
reason, subject to the provisions of any applicable employment agreement.
IN WITNESS WHEREOF, the Company and the Optionholder have executed and
delivered this Agreement as of the day and year first written above.
XXXXXXXXXXXXXXX.XXX, INC.
By:
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Xxxxxx X. Xxxxx, Xx.
President
OPTIONHOLDER:
---------------------------------
Name:
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EXHIBIT A
TO
AWARD AGREEMENT
Optionholder: __________________________________
Grant Date: __________________________________
Exercise Price: $_________________________________
Can Only Be Must Be
Shares of Common Stock Subject to Option Exercised After Exercised Before
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EXHIBIT B
TO
AWARD AGREEMENT
Pursuant to Paragraph 4 hereof, record partial exercise below:
PARTIAL EXERCISE
No. of Shares Date of No. of Shares Signature of
Exercised Exercise Remaining Endorsing Officer
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