EXHIBIT 10.16
MERCURY WASTE SOLUTIONS INC.
INCENTIVE STOCK OPTION AGREEMENT
This AGREEMENT is dated as of November 3, 1997, by and between MERCURY
WASTE SOLUTIONS, INC., a Minnesota corporation (the "Company") and XXXX X.
XXXXXXXX ("Optionee").
WHEREAS, pursuant to the Stock Option Plan of the Company (the "Plan"),
the Board of Directors of the Company has authorized granting to Optionee an
Incentive Stock Option to purchase certain shares of common stock of the Company
reserved for issuance pursuant to the Plan, such option to be for the term and
upon the terms and conditions hereinafter stated.
NOW, THEREFORE , it is hereby agreed:
1. GRANT OF OPTION. Pursuant to said action of the Board of Directors,
the Company hereby grants to Optionee the option to purchase, upon and subject
to the terms and conditions of the Plan, the terms and conditions of which are
incorporated in full herein by reference, twenty-five thousand (25,000) shares
of common stock (the "Option Stock") of the Company at the option price of $4
1/4 per share (the "Option"). The Company intends that the Option shall be an
Incentive Stock OptiON governed by the provisions of Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code"). The Optionee (or any other person
claiming under the Optionee) shall not have any of the rights of a shareholder
with respect to the Option Stock until the due exercise of the Option and
payment of the option price in accordance with this Agreement.
2. TERMS AND CONDITIONS.
a. Term of Option; Exercise of Option. The Option shall
terminate ten (10) years after the date hereof, subject to the
provisions contained herein. The Optionee may exercise the Option for
up to twenty percent (20%) of the Option Stock each year commencing one
year from the date hereof, with additional installments of twenty
percent (20%) exercisable on each of the second, third, fourth and
fifth year anniversary dates, in accordance with the Incentive Stock
Option Vesting Schedule attached hereto as Exhibit A. Such installments
shall be cumulative and, if in any year the total number of shares of
Option Stock which may be purchased in such year is not purchased, the
shares not purchased may be purchased in any subsequent year during the
term of the Option.
b. Procedure for Exercise. Subject to the foregoing, the
Option may be exercised in whole or in part from time to time by
serving written notice of exercise on the Company at its principal
office, accompanied by the payment of the option price in cash or check
payable to the Company. As soon as is practicable after such notice is
received, Optionee shall be recorded on the books of the Company as the
owner of the Option Stock purchased and the Company shall deliver to
Optionee a stock certificate evidencing such ownership.
c. Death or Disability of Optionee. If the Optionee dies or
becomes Disabled (as hereinafter defined) and the Optionee has been at
the time of his death or Disability in continuous employment by the
Company or a parent or subsidiary corporation, the Option shall be
exercisable in full on the date of Optionee's death or Disability
without regard to the
installment percentages provided in Section 2(a) above. The term
"Disability" shall mean any physical or mental impairment of Optionee,
whether total or partial, which prevents Optionee, in the reasonable
judgment of the Company, from carrying out or performing the major
duties of his employment with the Company. The determination of whether
an Optionee has a Disability within the meaning of this Section 2(c)
shall be made in writing by the Board of Directors in its sole
discretion.
d. Termination of Employment for Cause. If Optionee's
employment by the Company or a parent or subsidiary corporation is
terminated for cause, as is hereafter defined ("Cause"), the Option,
regardless of the extent vested, shall be canceled immediately.
Termination for Cause shall include termination for violation of any
employment agreement, or on fraud, embezzlement, securities law
violation, material violation or willful criminal violation of
environmental laws and regulations or an applicable agreement with a
federal or state environmental agency, sexual harassment of fellow
employees, or if Optionee is guilty of an act or acts of
insubordination, misconduct, dishonesty, or disloyalty against the
Company, or gross misconduct involving moral turpitude. The
determination of the Board of Directors with respect thereto shall be
final and conclusive.
e. Termination of Employment other than for Cause. If
Optionee's employment shall terminate for any reason, voluntary or
involuntary, other than for Cause, the Optionee may at any time within
three months after such termination exercise the Option to the extent
the Option was exercisable by the Optionee on the date of the
termination of his employment.
f. No Right to Continued Status as an Employee. This Option
shall not confer upon Optionee any right with respect to continued
status as en employee of the Company, nor shall it interfere in any way
with the right of the Company to terminate his status as an employee at
any time.
3. MODIFICATION AND TERMINATION BY BOARD OF DIRECTORS. The rights of
Optionee are subject to modification and termination in certain events as
provided in the Plan.
4. WITHHOLDING. Company shall be entitled to withhold from amounts due
to Optionee amounts required to be withheld for income taxes, FICA (social
security) taxes or other purposes as required under any federal, state or local
law. If Company fails to withhold in the full amount or at the time required by
law, Company may make up the deficiency by withholding from later amounts due.
If such amounts withheld are at any time for any reason insufficient to meet
Company's withholding obligations, Company may (i) withhold and deduct the
deficiency from any amounts due to Optionee for any reason, and (ii) require
that Optionee pay the amount of such withholding deficiency to Company (and
Optionee shall make such payment immediately upon demand).
5. OPTIONEE BOUND BY PLAN. The Optionee hereby acknowledges receipt of
a copy of the Plan and agrees to be bound by all the terms and provisions
thereof.
6. NOTICES. Any notice hereunder to the Company shall be addressed to
it at its principal office; and any notice hereunder to the Optionee shall be
addressed to him at the address set forth below; subject to the right of either
party to designate at any time hereunder in writing some other address.
7. ENTIRE AGREEMENT. This Agreement, together with the provisions of
the Plan, sets forth
the entire agreement between the parties with respect to the subject matter
hereof, and supersedes and revokes all prior negotiations, discussions,
representations, understandings and agreements between the parties with respect
to such subject matter.
8. AMENDMENT; WAIVER. This Agreement may be amended only in a written
instrument signed by all parties hereto and setting forth the nature of such
amendment and the specific intent to so amend. Rights under this Agreement may
be waived only in a written instrument signed by the waiving party and setting
forth the specific right being waived and the specific intent to so waive. A
waiver of any particular right in any particular instance shall not be deemed a
waiver of any other right or a waiver of such right in any other instance.
9. BINDING NATURE. This Agreement shall be binding upon and shall inure
to the benefit of the parties hereto, and their respective legal
representatives, heirs, successors and permitted assigns.
10. HEADINGS. Headings in this Agreement are for convenience of
reference only, and shall not alter the interpretation, meaning or effect of any
provision of this Agreement.
11. GOVERNING LAW. The validity, enforceability, interpretation and
effect of this Agreement shall be governed in all respects by the laws of the
State of Minnesota.
12. COUNTERPARTS. This Agreement may be executed in two counterparts,
each of which shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
MERCURY WASTE SOLUTIONS, INC
By: /s/ Xxxx X. Xxxxxxx
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Its: Chairman
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OPTIONEE:
/s/ Xxxx X. Xxxxxxxx
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Xxxx X. Xxxxxxxx
Address and Telephone Number of Optionee:
0000 - 00xx Xxxxx Xxxxx
Xxxxxxx, Xxxxxxxxx 00000
Phone: (000) 000-0000
EXHIBIT A
INCENTIVE STOCK OPTION VESTING SCHEDULE
Name of Employee: Xxxx X. Xxxxxxxx
Social Security Number ###-##-####
Date of Commencement of Employment: November 3, 1997
Number of Shares Subject to Option: 25,000
Date of Grant: November 3, 1997
OPTION VESTING SCHEDULE
NO. OF SHARES
DATE EXERCISABLE
---- -----------
November 3, 1998 5,000
November 3, 1999 5,000
November 3, 2000 5,000
November 3, 2001 5,000
November 3, 2002 5,000
The above vesting schedule assumes continuous employment. Reference is
made to the Plan and the Agreement for your rights to exercise your Option in
the event of termination of employment during lifetime or upon death or
disability. The above vesting schedule is in all respects subject to the terms
of the Plan.
