1
EXHIBIT 10.8
MOBILITY ELECTRONICS, INC.
INCENTIVE STOCK OPTION AGREEMENT
This Incentive Stock Option Agreement (the "Agreement") dated as of April
12, 1999 is entered into between Mobility Electronics, Inc., a Delaware
corporation (the "Company"), Xxxxxxx X. Xxxxxxxxx, an employee of the Company
(the "Optionee"). In consideration of the mutual promises and covenants made
herein, the parties hereby agree as follows:
1. GRANT OF OPTION. Under the terms and conditions of the Company's Amended
and Restated 1996 Long Term Incentive Plan (the "Plan"), a copy of which is
attached hereto and incorporated herein by reference, the Company grants to the
Optionee an option (the "Option") to purchase from the Company all or any part
of a total of 30,000 shares of the Company's Common Stock, par value $.01 per
share. The Option is granted as of the date first above written (the "Date of
Grant").
2. CHARACTER OF OPTION. The Option is an "incentive stock option" within
the meaning of Section 422 of the Internal Revenue Code of 1986, as amended.
3. TERM. The Option will expire on the tenth anniversary of the Date of
Grant or, in the event of the Optionee's termination of employment with the
Company, on such earlier date as may be provided in Section 6(b) of the Plan.
4. VESTING. Subject to the provisions of Section 6(b) of the Plan, this
Option shall vest in full and be exercisable in whole or in part during the one
year period following the earlier of (1) the day following the date upon which
the Company closes its initial public offering of its Common Stock provided such
closing occurs on or before March 31, 2001; (2) a Change In Control of the
Company as defined in Exhibit A to the Employment Agreement by and between
Optionee and the Company dated November 20, 1998; or (3) December 31, 2007. This
option shall be exercisable at a price equal to $4.00 per share if the Option
vests pursuant to 4(1) or 4(2) above and shall be exercisable at a price equal
to 110% of the fair market value of the Common Stock on the date of exercise if
the Option vests pursuant to 4(3) above.
5. PROCEDURE FOR EXERCISE. Exercise of the Option or a portion thereof
shall be effected by the giving of written notice to the Company and payment of
the purchase price prescribed in Section 1 above for the shares to be acquired
pursuant to the exercise.
6. PAYMENT OF PURCHASE PRICE. Payment of the purchase price for any shares
purchased pursuant to the Option shall be in cash, unless otherwise agreed to in
writing by the Compensation Committee of the Board of Directors of the Company.
7. TRANSFER OF OPTIONS. The Option may not be transferred except by will or
the laws of descent and distribution and, during the lifetime of the Optionee,
may be exercised only by the Optionee or by the Optionee's legally authorized
representative.
2
8. TERMINATION. The Option shall terminate on the earlier of (i) the
expiration date set forth in Section 3 above or, (ii) in the event of the
termination of the Optionee's employment, the date provided in Section 6(b) of
the Plan.
9. ACCEPTANCE OF THE PLAN. The Option is granted subject to all of the
applicable terms and provisions of the Plan, and such terms and provisions are
incorporated by reference herein. The Optionee hereby accepts and agrees to be
bound by all the terms and conditions of the Plan.
10. AMENDMENT. This Agreement may be amended by an instrument in writing
signed by both the Company and the Optionee.
11. CONFIDENTIALITY AND NONCOMPETITION. In consideration of the grant of
Option hereunder, Optionee agrees to the following:
(a) Acknowledgment of Proprietary Interest. Optionee recognizes the
proprietary interest of the Company and its affiliates in any Trade Secrets (as
hereinafter defined) of the Company and its affiliates. Optionee acknowledges
and agrees that any and all Trade Secrets currently known by Optionee or learned
by Optionee during the course of his engagement by the Company or otherwise,
whether developed by Optionee alone or in conjunction with others or otherwise,
shall be and is the property of the Company and its affiliates. Optionee further
acknowledges and understands that his disclosure of any Trade Secrets will
result in irreparable injury and damage to the Company and its affiliates. As
used herein, "Trade Secrets" means all confidential and proprietary information
of the Company and its affiliates, now owned or hereafter acquired, including,
without limitation, information derived from reports, investigations,
experiments, research, work in progress, drawings, designs, plans, proposals,
codes, marketing and sales programs, client lists, client mailing lists,
financial projections, cost summaries, pricing formula, and all other concepts,
ideas, materials, or information prepared or performed for or by the Company or
its affiliates and information related to the business, products or sales of the
Company or its affiliates, or any of their respective customers, other than
information which is otherwise publicly available; provided, however, "Trade
Secrets" does not include any information that is known or readily obtainable by
companies within the computer industry.
(b) Optionee acknowledges and agrees that the Company and its affiliates are
entitled to prevent the disclosure of Trade Secrets. As consideration for the
grant of the options hereunder to Optionee by the Company, Optionee agrees at
all times during his employment with the Company and thereafter to hold in
strict confidence and not to disclose or allow to be disclosed to any person,
firm or corporation, other than to persons engaged by the Company and its
affiliates to further the business of the Company and its affiliates, and not to
use except in the pursuit of the business of the Company and its affiliates, the
Trade Secrets, without the prior written consent of the Company, including Trade
Secrets developed by Optionee.
(c) Return of Materials at Termination. In the event of any termination or
cessation of his employment with the Company for any reason whatsoever, Optionee
will promptly deliver
3
to the Company all documents, data and other information pertaining to
Trade Secrets. Optionee shall not take any documents or other information,
or any reproduction or excerpt thereof, containing or pertaining to any
Trade Secrets.
(d) Competition During Employment. Optionee agrees that during his
employment with the Company, neither he, nor any of his affiliates, will
directly or indirectly compete with the Company or its affiliates in the
portable or handheld computer power, docking, and connectivity business,
which is defined as product lines or businesses that are competitive with
products that are manufactured, marketed or sold by the Company and its
affiliates during the term of his employment or under development during
the term of his employment (the "Business"); and that he will not act as an
officer, director, employee, consultant, shareholder, lender, or agent of
any entity which is competitive with the Business; provided, however, that
this Section shall not prohibit Optionee or any of his affiliates from
purchasing or holding an aggregate equity interest of up to 1% in any
business in competition with the Business. Furthermore, Optionee agrees
that during his employment with the Company, he will undertake no planning
for the organization of any business activity competitive with the Business
and Optionee will not combine or conspire with any other Optionees of the
Company and its affiliates for the purpose of the organization of any such
competitive business activity.
(e) Competition Following Employment. Optionee agrees that for a
period of one-year after the termination or cessation of his employment for
the Company for any reason whatsoever, neither he, nor any of his
affiliates, will directly or indirectly: (1) compete with the Company or
its affiliates in the Business, and that he will not act as an officer,
director, Optionee, consultant, shareholder, lender, or agent of any entity
which is engaged in the Business; provided, however, that this Section
shall not prohibit Optionee or any of his affiliates from purchasing or
holding an aggregate equity interest of up to 1% in any business in
competition with the Business. Furthermore, Optionee will not combine or
conspire with any other Optionees of the Company and its affiliates for the
purpose of the organization of any such competitive business activity.
12. INVENTIONS. In consideration of the grant of Option hereunder,
Optionee agrees to the following:
(a) Disclosure to Company. Optionee agrees to promptly disclose to the
Company any and all inventions, discoveries, improvements, trade secrets,
formulas, compositions, code, designs, programs, techniques, processes, and
know-how, whether or not reduced to writing or practice, conceived by
Optionee during the period of his or her employment with the Company,
either alone or jointly with others, which relate to or result from the
actual or anticipated business, work, research or investigations of the
Company, or which result, to any extent, from use of the Company's premises
or property (the work being hereinafter collectively referred to as the
"Intellectual Property"). Further, Optionee shall disclose in confidence to
the Company all patent and copyright applications filed by or on behalf of
Optionee during the term of his employment with the Company and, to the
extent such application related to the business of the Company at the date
Optionee's employment terminates, for a period of three (3) years
thereafter.
4
(b) Intellectual Property as Sole Property of the Company. Optionee
acknowledges and agrees that all the Intellectual Property shall be the
sole property of Optionee or any other entity designated by it, and
Optionee hereby assigns to the Company his or her entire right and interest
in and to all Intellectual Property. Optionee further agrees as to all
Intellectual Property to assist the Company in every way (at the Company's
expense) to obtain and from time to time enforce patents and copyrights on
the Intellectual Property in any and all countries during the term of this
Agreement. To that end, by way of illustration but not limitation, Optionee
will testify in any suit or other proceeding involving any of the
Intellectual Property, execute all documents which the Company reasonably
determines to be necessary or convenient for use in applying for and
obtaining patents and copyrights thereon and enforcing same, and execute
all necessary assignments thereof to the Company or persons designated by
it. Optionee's obligation to assist the Company in obtaining and enforcing
patents and copyrights for the Intellectual Property shall continue beyond
the termination of his employment, but the Company shall compensate
Optionee at a reasonable rate after such termination for the time actually
spent by Optionee at the Company's request on such assistance and the
Company's requests for assistance shall be reasonable in light of
Optionee's then existing business commitments. Optionee hereby irrevocably
appoints the Company, and its duly authorized officers and agents, as
Optionee's agent and attorney-in-fact to act for and on behalf of Optionee
in filing all patent and copyright applications, amendments, renewals, and
all other appropriate documents in any way related to Intellectual
Property. The Company will promptly notify Optionee following any such
filing, provided that the Company will not be obligated to make such
notification if as a result the Company would be in violation of any
agreement or order to which it is subject or bound.
(c) List of Prior Inventions. As a matter of record, Optionee has set
forth on Exhibit "A" attached hereto a complete list separately identifying
each invention, discovery, improvement, trade secret, formula, composition,
code, design, program, technique, process and know-how made or discovered
by Optionee prior to his employment with the Company. Optionee represents
and covenants that such list is complete. As a matter of record, Optionee
has set forth on Exhibit "A" attached hereto a complete list of all
inventions, programs, discoveries, or improvements relating to the
Company's business which have been made by Optionee prior to his employment
with the Company. Optionee represents and covenants that such list is
complete. All such matters set forth in Exhibit "A", if any, which Optionee
made prior to his employment by the Company are excluded from the scope of
this Agreement.
(d) Time of Invention; Presumption. For the purposes of this
Agreement, an invention or other Intellectual Property is deemed to have
been made or conceived during the duration of employment if during such
time, the invention or other Intellectual Property was conceived or first
actually reduced to writing or practice; and Optionee agrees that any
disclosure of an invention, Intellectual Property or any patent or
copyright application made within one (1) year after termination of his
employment shall be presumed to relate to an invention or other
Intellectual Property which was made or conceived during the term of
Optionee's employment unless Optionee provides satisfactory and compelling
evidence to the contrary.
(e) Training and Experience. Nothing herein is intended to prevent or
restrict the use by Optionee of Optionee's education, training and
experience, except insofar as is expressly
5
provided.
13. MISCELLANEOUS. This Agreement will be construed and enforced in
accordance with the laws of the State of Delaware and will be binding upon and
inure to the benefit of any successor or assign of the Company and any executor,
administrator, trustee, guardian or other legal representative of the Optionee.
Executed as of the date first above written.
MOBILITY ELECTRONICS, INC.
By: /s/ XXXXXXX X. XXXXX
--------------------
Xxxxxxx X. Xxxxx
Chief Executive Officer
OPTIONEE:
/s/ XXXXXXX X. XXXXXXXXX
------------------------
Xxxxxxx X. Xxxxxxxxx
###-##-####
Social Security Number of Optionee
6
Exhibit A
