EXHIBIT 10.5
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L-1 IDENTITY SOLUTIONS, INC.
2008 LONG-TERM INCENTIVE PLAN
Nonqualified Stock Option Award Certificate and Agreement
L-1 Identity Solutions, Inc. (the "Company"), a Delaware corporation,
pursuant to its 2008 Long-Term Incentive Plan (as amended, the "Plan"), hereby
issues to the Optionholder named below an option to purchase the number of
shares of Common Stock, $.001 par value (the "NQO Shares"), of the Company set
forth below (the "Option"), exercisable on the following terms and conditions.
Name of Optionholder: XXXXXX XXXXXXX
Social Security No. : XXX-XX-XXXX
Number of NQO Share: 250,000
Type of Option: Non-Qualified Stock Option
Option Price per Share: $7.23
Date of Issuance: September 08, 2009
Exercise Schedule: Subject to the provisions of the
Terms and Conditions to which this Certificate
is attached, this Option shall be exercisable
cumulatively to the extent of 1/4 of the total
number of NQO Shares annually on each
anniversary date of the Date of Issuance.
Expiration Date: This Option shall expire ten years from
the Date of Issuance, subject to earlier
termination as provided in the Terms and
Conditions to which this Certificate is
attached.
TRANSFER OF THE OPTION REPRESENTED BY THIS CERTIFICATE IS RESTRICTED IN
ACCORDANCE WITH THE ATTACHED TERMS AND CONDITIONS.
By signing below, each of the Company and the Optionholder agrees to
the foregoing and to the attached Long-Term Incentive Plan Terms and Conditions,
which are incorporated herein by reference.
L-1 IDENTITY SOLUTIONS, INC. OPTIONHOLDER
By Online Acceptance of this
Agreement, the Optionee hereby
agrees to be bound by all of the
By: /s/Xxxxx X. Xxx terms and conditions of this
--------------------------- Agreement and the Plan
Xxxxx X. Xxx
Member of the Board of Directors, XXXXXX XXXXXXX Chairman
of the Compensation Committee
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L-1 IDENTITY SOLUTIONS, INC.
STOCK OPTION AWARD AGREEMENT AND
2008 LONG-TERM INCENTIVE PLAN TERMS AND CONDITIONS
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(Nonqualified)
1. Option Price. The price to be paid for each share of common
stock of the Company, $.001 par value (each, a "NQO Share"), issued upon
exercise of the whole or any part of this Option, is the Option Price per Share
set forth on the stock option certificate to which these terms and conditions
have been attached (the "Certificate").
2. Exercise Schedule. This Option shall vest in accordance with
the Exercise Schedule set forth on the Certificate. The Option is exercisable
only for NQO Shares that have vested as described above and may not be exercised
as to any NQO Shares after the Expiration Date set forth on the Certificate or
after any earlier termination of the Option in accordance with this Agreement.
3. Method and Terms of Exercise.
(a) Notice of Exercise. To exercise this Option, the
Optionholder shall deliver written notice of exercise to the Company or
its designated online service provider, or in such other manner as may
then be acceptable to the Company, specifying the number of shares with
respect to which the Option is being exercised accompanied by payment
of the Option Price for such NQO Shares.
(b) Payment. Payment shall be made by (i) cash or check
payable to the Company, (ii) consideration received by the Company
under a cashless exercise program implemented by the Company in
connection with the Plan, or (iii) by any combination of the foregoing
methods of payment.
(c) Delivery of NQO Shares. Promptly following notice of
exercise and payment, the Company will deliver to the Optionholder a
certificate representing the number of NQO Shares with respect to which
the Option has been exercised.
(d) Compliance and Registration. If said NQO Shares are
not at that time effectively registered under the Securities Act of
1933, as amended, the Optionholder shall include with such notice a
letter, in form and substance satisfactory to the Company, confirming
that the NQO Shares are being purchased for the Optionholder's own
account for investment and not with a view to distribution. The
issuance or delivery of any NQO Shares hereunder may be postponed by
the Committee for such period as may be required to comply with any
applicable requirements under the federal securities laws, any
applicable listing requirements of the New York Stock Exchange or any
national securities exchange or any requirements under any law or
regulation applicable to the issuance or delivery of such NQO Shares.
The Company shall not be obligated to issue or deliver any such NQO
Shares if the issuance or delivery thereof would constitute a violation
of any provision of any law or of any applicable regulation of any
governmental authority, the New York Stock Exchange or any national
securities exchange; but the
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Company shall exercise its reasonable efforts to cause the NQO Shares
that are the subject of the Option to be effectively registered on Form
S-8 (or any successor form) under the Securities Act of 1933, as
amended, and for so long as the Company shall be subject to the
reporting requirements of the Exchange Act, to exercise its reasonable
efforts to keep such registration in effect.
(e) Withheld NQO Shares -- Rule 16b-3. Any election made
by the Optionholder, if then subject to Section 16 of the Exchange Act,
to make payment of any portion of a tax withholding obligation with
respect to any Option exercise by withholding or assignment of NQO
Shares or to make payment of any portion of an exercise price by
assignment of NQO Shares shall be subject to any then-applicable
requirements of Rule 16b-3 and other applicable rules under Section 16
of the Exchange Act.
4. Rights as a Stockholder or Employee. The Optionholder shall
not have any rights in respect of NQO Shares to which the Option has not been
exercised as provided above. The Optionholder shall not have any rights to
continued employment by the Company or its affiliates by virtue of the issuance
of this Option.
5. Stock Dividends; Stock Splits; Recapitalization. In the event
of any stock split, stock dividend, reclassification of shares, spin-off or
other similar change in the Company's capitalization, or other distribution with
respect to holders of the Company's common stock other than normal cash
dividends, the Option shall be appropriately adjusted by the Company in
accordance with the Plan.
6. Dissolution or Liquidation; Sale of the Company. In the event
of a dissolution or liquidation of the Company or a Sale of the Company, the
Administrator may in its discretion take such actions with respect to the Option
as set forth in the Plan.
7. Option Not Transferable. This Option is not transferable by
the Optionholder otherwise than by will or the laws of descent and distribution.
Notwithstanding the foregoing (but if Optionholder then is subject to Section 16
of the Exchange Act, only to the extent consistent with the requirements of Rule
16b-3 or other rules under Section 16 of the Exchange Act), this Option may be
assigned to the extent such assignment is in connection with the Optionholder's
estate plan or pursuant to an order that would constitute a qualified domestic
relations order as defined in the Internal Revenue Code of 1986, as amended (the
"Code").
8. Exercise of Option After Termination of Employment.
Intentionally left blank.
9. Covenant. The Company and Employee agree that as a result of
and after giving effect to the grants of this Option and 250,000 shares of
restricted common stock of the Company, $.001 par value, on the date hereof (the
"Equity Grants"), Employee's beneficial ownership, as determined pursuant to
Section 203(c)(9) of the General Corporation Law of the State of Delaware (the
"DGCL"; such ownership being referred to herein as "Beneficial Ownership") of
the outstanding shares of the "voting stock" of the Company, as defined in and
computed in accordance with Section 203(c)(8) of the DGCL ("Company Voting
Securities"), shall increase from below 15% to 15.31% of the Company's Voting
Securities. The Company
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and Employee agree and acknowledge that the Company does not wish to forego the
protections afforded by Section 203 of the DGCL as a result of the Equity
Grants. Accordingly, in consideration of the Equity Grants, Employee agrees that
the provisions of Section 203 of the DGCL, including the restrictions and
exceptions contained therein, are incorporated in this Agreement by reference
and shall by virtue of this Agreement apply in full force and effect with
respect to Employee and continue to apply to Employee if Employee shall become
an "interested stockholder", as defined in Section 203 of the DGCL; provided
however, that for purposes of the application of the provisions of Section 203
of the DGCL incorporated herein to Employee by virtue of this Agreement, all
references to "15%" in the definition of "interested stockholder" contained in
Section 203 shall be read and interpreted to be references to 15.4%.
The provisions of this covenant may be waived or amended by a majority of the
members of the board of directors of the Company who (i) are not employees of
the Company, (ii) are not Affiliates or Associates (each as defined in Section
203 of the DGCL) of Employee and (iii) who otherwise have been determined to be
"independent" under the listing standards of the New York Stock Exchange
("Independent Directors").
Each of Employee and the Company acknowledge and agree that (i) the provisions
of this covenant are reasonable and necessary to protect the proper and
legitimate interests of the parties hereto, and (ii) the parties would be
irreparably damaged in the event any of the provisions of this covenant were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the parties shall be entitled to preliminary and
permanent injunctive relief to prevent breaches of the provisions of this
covenant by the other parties without the necessity of proving actual damages or
of posting any bond, and to enforce specifically the terms and provisions
hereof, which rights shall be cumulative and in addition to any other remedy to
which the parties may be entitled hereunder or at law or equity.
This covenant shall be interpreted in accordance with the laws of the State of
Delaware without reference to the choice of laws provisions thereof and Employee
hereby consents and submits to, the jurisdiction of the Court of Chancery of the
State of Delaware for any matters relating to this covenant and waives any
objection to the laying of venue of any such litigation in the Court of Chancery
of the State of Delaware.
10. Payment of Taxes. The Optionholder shall pay to the Company,
or make provision satisfactory to the Company for payment, of all applicable
federal, state and local income and employment act withholding obligations no
later than the date of exercise. Such tax obligations may be paid in whole or in
part by delivery of Company Common Stock, including NQO Shares retained from the
Option creating the tax obligation, valued at their Fair Market Value. The
Company, its parent and subsidiaries may, to the extent permitted by law, deduct
any such tax obligations from any payment of any kind otherwise due to the
Optionholder.
11. Administration. The Option is issued and this Agreement has
been made pursuant and subject to the terms and conditions of the Company's 2008
Long-Term Incentive Plan, as amended from time to time. The Plan, the Option and
this Agreement shall be administered by the Board or such other Administrator to
which the Board may delegate its authority in
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accordance with the Plan. The Administrator shall have such powers and duties as
set forth in the Plan. Any decisions of the Administrator made with respect to
any of the foregoing shall be made in the Administrator's sole discretion and
shall be final and binding on the Company, the Optionholder and all other
persons.
12. Option Nonqualified. The Option shall be a nonstatutory option
which is not intended to meet the requirements of Section 422 of the Code.
13. Surrender and Notation of Option. If and when the Option is
exercised in its entirety, this Agreement and the Certificate shall be
surrendered to the Company for cancellation. If and as the Option shall be
exercised in part, or any change or adjustment shall be made to the Option as
contemplated under this Agreement, an appropriate notation reflecting the
partial exercise or the change or adjustment will be made on the records of the
Company.
14. Incorporation by Reference; Interpretation. The terms and
conditions of the Plan, which is attached to this Agreement as Exhibit 1, are
hereby incorporated into this Agreement by reference. The Optionholder hereby
accepts the Option subject to all the terms and conditions thereto and
acknowledges that in the event of any ambiguity concerning the interpretation of
this Agreement and the Plan, the terms and conditions of the Plan shall govern.
15. Online Administration; Acceptance. If the Company has
designated an online service provider, such as E*Trade, to provide for online
administration of this NQO, the Optionholder shall be required to use such
designated online service provider for (a) online acceptance of this Agreement
and (b) administration of this NQO. Should an Optionholder want to decline this
Agreement, written notice must be provided to the Executive Vice President,
Chief Financial Officer and Treasurer at 000 Xxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxxx,
Xxxxxxxxxxx 00000.
16. Terms of Employment Agreement. Option holder is party to an
employment agreement with L-1 Identity Solutions, Inc. dated as of August 29,
2006 and amended as of July 31, 2009, which includes special vesting, exercise
and/or other rights relating to (1) the Option granted under this Nonqualified
Stock Option Award Certificate and Agreement, and (2) other stock options to
purchase shares of common stock of L-1 Identity Solutions, Inc., whether granted
prior to or subsequent to this particular Option and Agreement. A copy of such
employment agreement is attached hereto as Exhibit 2. To the extent such
employment agreement contains special vesting, exercise and/or other rights
respecting the Option granted under this Nonqualified Stock Option Award
Certificate and Agreement (and/or respecting other stock options to purchase
shares of common stock of L-1 Identity Solutions, Inc., whether granted prior to
or subsequent to this particular Option and Agreement), and such rights vary
from those set forth in this Agreement (and/or the terms of any previous or
subsequent stock option awards or agreements, as the case may be), the rights
set forth in the employment agreement shall govern.
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EXHIBITS
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Exhibit 1 2008 Long-Term Incentive Plan
Exhibit 2 Employment Agreement dated as of August 29, 2006 and amended
as of July 31, 2009
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