INCENTIVE STOCK OPTION PLAN CONTRACT
THIS INCENTIVE STOCK OPTION CONTRACT entered into as of the [DATE] day
of [DATE], between Real Time Strategies, Inc., a New York corporation
(the "Company"), and [INSERT NAME OF OPTIONEE] (the "Optionee").
W I T N E S S E T H:
1. The Company, in accordance with the allotment made by the Board
of Directors of the Company (the "Board of Directors") and subject to the terms
and conditions of the 1997 Stock Option Plan of the Company (the "Plan"), grants
as of the date hereof to the Optionee an option to purchase an aggregate of
________ shares of the Common Stock, $.01 par value per share, of the Company
("Common Stock") at $ per share, being at least equal to the fair market
value of such shares of Common Stock on the date hereof. This option is intended
to constitute an incentive stock option within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended (the "Code").
2. The term of this option shall be ten (10) years from the date
hereof, subject to earlier termination as provided in the Plan.
3. This option shall become vested with respect to % of the
shares of Common Stock subject thereto on each of the [ANNIVERSARY DATES] of
the date of grant.
4. To the extent vested, an option shall become exercisable on the
later of (i) the two-year anniversary of the date the Optionee commenced
employment or service with the Company or (ii) December 30, 2002; PROVIDED,
HOWEVER, that such vested options shall become immediately exercisable in
full upon the later (a) the two-year anniversary of the date the Optionee
commenced employment or service with the Company or (b) the Company's
completion of an IPO or upon its otherwise becoming a public company. The
right to purchase shares of Common Stock under this option shall be
cumulative, so that if the full number of shares purchasable in a period
shall not be purchased, the balance may be purchased at any time or from time
to time thereafter, but not after the expiration of the option as provided in
the Plan. Notwithstanding the foregoing, in no event may a fraction of a
share of Common Stock be purchased under this option.
5. This option shall be exercised by giving written notice to the
Company at its principal office, presently 00 Xxxxxxxx Xxxx, Xxxxxxxxx, Xxx
Xxxx, Xxxx.: Secretary of the Company, stating that the Optionee is exercising
this incentive stock option, specifying the number of shares being purchased and
accompanied by payment in full of the aggregate purchase price therefor (a) in
cash or by certified check, (b) if the Board of Directors permits, with
previously acquired shares of Common Stock which have been held by the Optionee
for at least six months, or (c) a combination of the foregoing. Such shares,
upon payment of the purchase price, shall be fully paid and nonassessable and
the holders of such shares will not be subject to personal liability by reason
of being such holders, except for personal liability, if any, imposed by Section
630 of the New York Business Corporation Law.
6. Notwithstanding the foregoing, this option shall not be
exercisable by the Optionee unless (a) a Registration Statement under the
Securities Act of 1933, as amended (the "Securities Act") with respect to the
shares of Common Stock to be received upon the exercise of the option shall be
effective and current at the time of exercise or (b) there is an exemption from
registration under the Securities Act for the issuance of the shares of Common
Stock upon exercise. The Optionee hereby represents and warrants to the Company,
that (i) the shares of Common Stock to be issued upon the exercise of this
option are being acquired by the Optionee for his own account, for investment
only and not with a view to the resale or distribution thereof, and (ii) any
subsequent resale or distribution of shares of Common Stock by him will be made
only pursuant to (x) a Registration Statement under the Securities Act which is
effective and current with respect to the shares of Common Stock being sold, or
(y) a specific exemption from the registration requirements of the Securities
Act, but in claiming such exemption, the Optionee shall, prior to any offer of
sale or sale of such shares of Common Stock, provide the Company with a
favorable written opinion of counsel, in form and substance satisfactory to the
Company, as to the applicability of such exemption to the proposed sale or
distribution. Such representations and warranties shall also be deemed to be
made by the Optionee upon each exercise of this option. Nothing herein shall be
construed as requiring the Company to register the shares subject to this option
under the Securities Act.
7. Notwithstanding anything herein to the contrary, if at any time
the Board of Directors shall determine in its discretion that the listing or
qualification of the shares of Common Stock subject to this option on any
securities exchange or under any applicable law, or the consent or approval of
any governmental regulatory body, is necessary or desirable as a condition of,
or in connection with, the granting of an option, or the issue of shares of
Common Stock thereunder, this option may not be exercised in whole or in part
unless such listing, qualification, consent or approval shall have been effected
or obtained free of any conditions not acceptable to the Board of Directors.
8. The Optionee hereby represents that it is his intention to
remain in the employ or service of the Company; PROVIDED, HOWEVER, that nothing
in the Plan or herein shall confer upon the Optionee any right to continue in
the employ of the Company, any Parent or any of its Subsidiaries, or interfere
in any way with any right of the Company, any Parent or its Subsidiaries
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to terminate such employment at any time for any reason whatsoever without
liability to the Company, any Parent or any of its Subsidiaries.
9. The Company may affix appropriate legends upon the certificates
for shares of Common Stock issued upon exercise of this option and may issue
such "stop transfer" instructions to its transfer agent in respect of such
shares as it determines, in its discretion, to be necessary or appropriate to
(a) prevent a violation of, or to perfect an exemption from, the registration
requirements of the Securities Act, (b) implement the provisions of the Plan or
any agreement between the Company and the Optionee with respect to such shares
of Common Stock, or (c) permit the Company to determine the occurrence of a
"disqualifying disposition," as described in section 421(b) of the Code, of the
shares of Common Stock transferred upon the exercise of this option. Such
legend, if required, shall be substantially in the form as follows:
"The shares represented by this certificate have not been registered
under the Securities Act of 1933. They may not be sold or transferred
in the absence of an effective registration statement for the shares
under the Securities Act of 1933, or an opinion of counsel for the
Corporation that registration is not required under said Act."
10. The Company may withhold cash and/or shares of Common Stock to
be issued to the Optionee in the amount which the Company determines is
necessary to satisfy its obligation to withhold taxes or other amounts incurred
by reason of the grant or exercise of this option, its disposition or the
disposition of the underlying shares of Common Stock. Alternatively, the Company
may require the Optionee to pay the Company such amount in cash promptly upon
demand.
11. In the event of any disposition of the shares of Common Stock
acquired pursuant to the exercise of this option within two years from the date
hereof or one year from the date of transfer of such shares to him, the Optionee
shall notify the Company thereof in writing within 30 days after such
disposition. In addition, the Optionee shall provide the Company on demand with
such information as the Company shall reasonably request in connection with
determining the amount and character of the Optionee's income, the Company's
deduction and its obligation to withhold taxes or other amount incurred by
reason of such disqualifying disposition, including the amount thereof. The
Optionee shall pay the Company in cash on demand the amount, if any, which the
Company determines is necessary to satisfy such withholding obligation.
12. The Company and the Optionee agree that they will both be
subject to and bound by all of the terms and conditions of the Plan, a copy of
which is attached hereto and made a part hereof. Any capitalized term not
defined herein shall have the meaning ascribed to it in the Plan. In the event
of a conflict between the terms of this Contract and the terms of the Plan, the
terms of the Plan shall govern. As a condition to the granting of this option,
the Optionee agrees, for himself and his personal representatives, that any
dispute or disagreement which may arise under or as a result of or pursuant to
this Contract shall be determined by the Board of Directors, in its sole
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discretion, and that any interpretations by the Board of Directors of the terms
of this Contract shall be final, binding and conclusive.
13. The Optionee represents and agrees that he will enter into and
sign a non-compete covenant with the Company promising not to compete with
the Company and any Parent (as defined in Paragraph 19) and Subsidiaries.
14. The Optionee represents and agrees that he will comply with all
applicable laws relating to the Plan and the grant and exercise of the option
and the disposition of the shares of Common Stock acquired upon exercise of the
option, including without limitation, federal and state securities and "blue
sky" laws.
15. This option is not transferable otherwise than by will or the
laws of descent and distribution and may be exercised, during the lifetime of
the Optionee, only by him or his legal representatives. In the event of the
death of the Optionee, a condition of exercising this option shall be the
delivery to the Company of such tax waivers and other documents as the Board of
Directors shall determine.
16. This Contract shall be binding upon and inure to the benefit of
any successor or assign of the Company and to any heir, distributee, executor,
administrator or legal representative entitled by law to the Optionee's rights
hereunder.
17. This Contract shall be governed by, and construed and enforced
in accordance with, the laws of the State of New York, without regard to the
conflicts of law rules thereof.
18. The invalidity or illegality of any provision herein shall not
affect the validity of any other provision.
19. The Optionee agrees that the Company may amend the Plan and the
options granted to the Optionee under the Plan, subject to the limitations
contained in the Plan.
20. This Contract is binding on the parties and their respective
successors, heirs, legal representatives and permitted assigns.
IN WITNESS WHEREOF, the parties hereto have executed this Contract as
of the day and year first above written.
REAL TIME STRATEGIES, INC.
By:
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[INSERT NAME OF OPTIONEE]
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(Address)
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