Exhibit 10.17
Incentive Stock Option Agreement
[FOR EMPLOYEES ONLY]
AGREEMENT (this "Agreement") entered into as of the ____ day of
______________, ____ by and between Orbcomm Inc., a Delaware corporation (the
"Company"), and the undersigned employee (the "Employee") of the Company.
WHEREAS, pursuant to the Orbcomm Inc. Stock Option Plan (the "Plan"),
the Company desires to grant to the Employee an option to acquire shares of
Common Stock, par value $0.001 per share, of the Company ("Shares"); and
WHEREAS, the Employee desires to accept such option subject to the
terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements contained herein, the Company and the Employee,
intending to be legally bound, hereby agree as follows:
1. Grant of Option. On the terms and conditions hereinafter set forth,
the Company hereby grants to the Employee an option to purchase all (or any
part) of ______ Shares (the "Option"). This Option is granted on
_______________, ________ (the "Grant Date"). The Option is intended to be an
Incentive Stock Option. This Option is granted pursuant to the Plan, and is
governed by the terms and conditions of the Plan. All defined terms used herein,
unless specifically defined in this Agreement, have the meanings assigned to
them in the Plan.
2. Exercise Price. The exercise price (the "Exercise Price") for the
Shares covered by the Option will be $_______.
3. Time of Exercise of Option.
(a) The Option will become exercisable as follows:
(i) [_____]% will be exercisable immediately;
(ii) the remaining [_____]% will be exercisable at the rate of
6.25% per calendar quarter as of the last day of the calendar quarter coincident
with or immediately following the Grant Date, until 100% of the Option will be
exercisable on the last day of the calendar quarter immediately preceding or
coincident with the fourth anniversary of the Grant Date.
ORBCOMM INC. STOCK OPTION PLAN
(b) Notwithstanding any other provision of this Agreement to the
contrary, the Option will become immediately fully exercisable on the date of
any Change of Control (as defined in the Plan), without regard to the
satisfaction of any time-based criteria.
4. Term of Options.
(a) The Option will expire 10 years from the date hereof, but will be
subject to earlier termination as provided below.
(b) Upon ceasing to be an Employee,
(i) the unexercisable portion of the Option hereby granted will
terminate on the date of such termination of employment.
(ii) the exercisable portion of the Option hereby granted will be
treated as follows:
(A) Subject in each case to the repurchase rights described
in Paragraph 5 below and the Shareholders' Agreement (defined below), if the
Company terminates the Employee for any reason except for Cause or if the
Employee voluntarily ceases to be an employee, the exercisable portion of the
Option hereby granted will be exercisable for thirty days following the
termination of employment, unless the Employee terminates employment because the
Employee in Disabled or if the Employee dies, in which case, such Employee, or
such Employee's personal representative, respectively, may exercise the
exercisable portion of the Option hereby granted for three months following the
termination of employment because the Employee is Disabled or has died.
(B) If the Employee is terminated for Cause, the exercisable
portion of the Option hereby granted will terminate on the date of such
termination of employment.
(i) For purposes of this Agreement, "Cause" means the definition
thereof contained in such Employee's employment agreement, if any, with the
Company or any subsidiary of the Company, as the same may be amended from
time to time and in effect or, in the event that no definition is so
provided, any of the following: (A) the Employee's continued failure,
whether willful, intentional or negligent, to perform substantially his
duties (other than as a result of being Disabled); (B) dishonesty or gross
negligence in the performance of the Employee's duties; (C) an act or acts
on the Employee's part constituting a felony under the laws of the United
States or any state thereof; (D) any willful act
ORBCOMM INC. STOCK OPTION PLAN
or omission on the Employee's part which is materially injurious to the
financial condition or business reputation of the Company or any of its
subsidiaries; or (E) the Employee has breached any provision or covenant
contained in (x) the Employee's employment agreement, (y) the Shareholders
Agreement among the Company, the Employee, and the other signatories
thereto, if it has been executed by the Employee or (z) any other agreement
between the Employee and the Company.
(iv) For purposes of this Agreement, "Disabled" means, the
Employee is terminated due to "Disability" within the meaning of Code
Section 22(e).
(c) If the aggregate Fair Market Value (determined on the date the
Option is granted) of a Share subject to an Incentive Stock Option which is
exercisable for the first time during any calendar year exceeds $100,000, then
the portion of the Incentive Stock Option in excess of the $100,000 limitation
will be treated as a Non-Statutory Stock Option.
5. Repurchase Rights.
(a) The Company has the right to repurchase the Shares acquired upon
the exercise of Options for a period of three months after the Employee
terminates employment or three months after the Shares for which the Option is
exercised or acquired, whichever is later. The purchase price per Share payable
is as follows:
(i) if the Employee's employment ends because the Employee was
terminated by the Company for Cause, the amount equal to the lesser of: (A) the
Fair Market value of the Shares at the time of the termination of employment;
and (B) the Exercise Price;
(ii) if the Employee's employment ends because of a voluntary
termination by the Employee and such termination occurs prior to expiration of
the Holding Period (as defined in Section 5(b) below) for the Shares acquired
through the exercise of the exercisable portion of the Option, the amount equal
to the lesser of: (A) the Fair Market Value of the Shares at the time of the
termination of employment; and (B) the Exercise Price;
(iii) if the Employee's employment ends because of a voluntary
termination by the Employee and such termination occurs after the expiration of
the Holding Period (as defined in Section 5(b) below) for the Shares acquired
through the exercise of the exercisable portion of the Option, the amount equal
to the greater of:
ORBCOMM INC. STOCK OPTION PLAN
(A) the Fair Market Value of the Shares at the time of the termination of
employment; and (B) the Exercise Price;
(ii) if the Employee's employment ends because the Employee
terminates for any other reason (death, termination without Cause or because the
Employee is Disabled) the amount equal to the greater of: (A) the Fair Market
Value of the Shares at the time of the termination of employment; and (B) the
Exercise Price.
(b) For purposes of this Agreement, the Holding Period, is the third
anniversary of the earlier of: (i) the date on which such Shares acquired
through the exercise of the exercisable portion of the Option were first
exercised; and or (ii) the date on which such Shares acquired through the
exercise of the exercisable portion of the Option were first exercisable.
6. Manner of Exercise of Option. The Option may be exercised by
delivery, via first class mail, interoffice mail, fax or electronic mail of a
Notice of Option Exercise and related forms to the Company stating the number of
Shares with respect to which the Option is being exercised and accompanied by
payment of an amount equal to the Exercise Price multiplied by the number of
Shares being purchased pursuant to the Option (the "Total Exercise Cost") in
cash or by check, bank draft or money order payable to the order of the Company
or, subsequent to an Initial Public Offering, (i) through the delivery to the
Company of Shares of Common Stock with an aggregate Fair Market Value on the
date of exercise equal to the Total Exercise Cost, subject to such limitations
and prohibitions as the Committee may adopt from time to time or (ii) through
the delivery to the Company of an Authorization for Exercise of Options
"Cashless" Exercise Form with irrevocable instructions to a broker to deliver
promptly to the Company an amount equal to the Total Exercise Cost, subject to
such limitations as the Committee may adopt from time to time or by any
combination of the above methods of payment.
7. Non-Transferability. The right of the Employee to exercise the
Option (as and when exercisable) may not be assigned or transferred by the
Employee other than by will or the laws of descent and distribution. The Option
may be exercised and the Shares may be purchased during the lifetime of the
Employee only by the Employee (or the Employee's legal representative in the
event that the Employee's employment is terminated due to becoming "Disabled"
within the meaning of Section 4(b)(iv) of this Agreement). Any attempted
assignment or transfer, except as hereinabove provided, including without
limitation any purported assignment, whether voluntary or by operation of law,
pledge, hypothecation or other disposition contrary to the provisions hereof, or
any levy of execution, attachment, trustee process or similar process, whether
legal or equitable, upon the Option, will in each instance be null and void.
ORBCOMM INC. STOCK OPTION PLAN
8. Representation Letter and Investment Legend.
(a) In the event that for any reason the issuance of the Shares to be
issued upon exercise of an exercisable Option will not be effectively registered
under the Securities Act of 1933, as amended (the "1933 Act"), upon any date on
which the Option is exercised, the Employee (or the person exercising the Option
pursuant to Section 6) will give a written representation to the Company in the
form attached hereto as Exhibit A, and the Company will place the legend
described in Exhibit A, upon any certificate for the Shares issued by reason of
such exercise.
(b) The Company will be under no obligation to qualify Shares or to
cause a registration statement or a post-effective amendment to any registration
statement to be prepared for the purpose of covering the issuance of Shares.
9. Adjustments. Subject to Section 8 of the Plan, in the event of any
change in the outstanding Shares by reason of an acquisition, spin-off or
reclassification, recapitalization or merger, combination or exchange of Shares
or other corporate exchange, Change of Control or similar event, or as required
under any Option Agreement, the Committee may adjust appropriately the number or
kind of Shares or securities subject to the Plan and available for or covered by
Grants and Share prices related to outstanding Grants and make such other
revisions to outstanding Grants as it deems are equitably required.
10. No Special Employment Rights. Nothing contained in this Agreement
will be construed or deemed by any person under any circumstances to bind the
Company or any of its subsidiaries to continue the employment of the Employee
for the period within which this Option may vest or for any other period.
11. Rights as a Shareholder. The Employee will have no rights as a
shareholder with respect to any Shares which may be purchased upon the vesting
of this Option unless and until a certificate or certificates representing such
Shares are duly issued and delivered to the Employee. If at any time during the
term of the Option, the Company will be advised by its counsel that the Shares
are required to be registered under the Securities Act or under applicable state
securities laws, or that delivery of the Shares must be accompanied or preceded
by a prospectus meeting the requirements of such laws, delivery of Shares by the
Company may be deferred until a registration is effective or a prospectus is
available or an appropriate exemption from registration is secured. Prior to an
Initial Public Offering, the Employee will be required to enter into a
shareholder agreement with the Company prohibiting the sale, transfer or
assignment of the Shares without first offering the Shares to the Company and/or
certain other stockholders, on a form provided by the Company, upon the exercise
of any Option under the Plan.
ORBCOMM INC. STOCK OPTION PLAN
12. Withholding Taxes. The Employee hereby agrees, as a condition to
any exercise of the Option, to provide to the Company an amount sufficient to
satisfy its obligation to withhold certain federal, state and local taxes
arising by reason of such exercise (the "Withholding Amount"), if any, by (a)
authorizing the Company to withhold the Withholding Amount from the Employee's
cash compensation, or (b) remitting the Withholding Amount to the Company in
cash; provided that, to the extent that the Withholding Amount is not provided
by one or a combination of such methods, the Company may at its election
withhold from the Shares delivered upon exercise of the Option that number of
Shares having a Fair Market Value equal to the Withholding Amount.
13. Execution of Shareholders Agreement. The Employee acknowledges
that, in connection with his prior or future purchase of Shares of the Company,
he has previously executed and delivered that certain Shareholders Agreement,
dated the date hereof, by and among the Company and the shareholders of the
Company named therein (the "Shareholders Agreement"). The Employee further
agrees that all Shares acquired by him upon exercise of the Option will be
subject to the terms and conditions of the Shareholders Agreement, as the same
may have been amended or modified in accordance with its terms.
14. Lock-Up Agreements. The Employee agrees that in the event of an
Initial Public Offering or any other offering of any securities of the Company,
if the Company so requests, the Employee will enter into an agreement on terms
and conditions satisfactory to the Company with the relevant underwriters of
such transaction that provides that the Employee may not directly or indirectly
offer, pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant for
the sale of, or otherwise dispose of or transfer the Shares or any other shares
of the Company's Common Stock or securities convertible into or exchangeable or
exercisable for such shares owned by the Employee, or enter into any swap or
other arrangement that transfers, in whole or in part, the economic consequences
of ownership of any such shares, for a period of up to one year after the date
of the relevant prospectus.
15. Delivery of Certificates. The Employee will have no interest in
the Shares unless and until certificates for the Shares are issued following
exercise of the Option.
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[Signatures on Following Page]
ORBCOMM INC. STOCK OPTION PLAN
OPTION AGREEMENT
Counterpart Signature Page
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed, by its officer thereunto duly authorized, and the Employee has
executed this Agreement, all as of the day and year first above written.
ORBCOMM INC. EMPLOYEE
By:
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Title:
------------------------------ Address:
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(print name)
Facsimile Number:
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Social Security Number
Email Address:
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