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Exhibit 10.25
HOUSTON STREET EXCHANGE, INC.
Amended and Restated Incentive Stock Option Agreement
GRANTED UNDER 1999 STOCK INCENTIVE PLAN
1. GRANT OF OPTION.
This Amended and Restated Incentive Stock Option Agreement (this
"Agreement") evidences the grant by Houston Street Exchange, Inc., a Delaware
corporation (the "Company"), on July 30, 1999 (the "Grant Date") to Xxxxx X.
Xxxxxx Xx., an employee of the Company (the "Participant"), of an option to
purchase, in whole or in part, on the terms provided herein and in the Company's
1999 Stock Incentive Plan (the "Plan"), a total of 240,000 shares (the "Shares")
of common stock, $0.01 par value per share, of the Company ("Common Stock") at
$0.0833 per Share. Unless earlier terminated, this option shall expire on July
30, 2006 (the "Final Exercise Date").
It is intended that the option evidenced by this Agreement shall be an
incentive stock option as defined in Section 422 of the Internal Revenue Code of
1986, as amended and any regulations promulgated thereunder (the "Code"). Except
as otherwise indicated by the context, the term "Participant", as used in this
option, shall be deemed to include any person who acquires the right to exercise
this option validly under its terms.
This Agreement amends and restates that certain Incentive Stock Option
Agreement of July 30, 1999, which granted to Xxxxx X. Xxxxxx Xx. an option to
purchase a total of 240,000 Shares of the Company's Common Stock at $0.0833 per
Share (the "Prior Agreement"). This Agreement supercedes the Prior Agreement in
its entirety, including and without limitation Section 2, concerning the option
vesting schedule.
2. VESTING SCHEDULE.
This option will become exercisable ("vest") in full as to (i) one-sixth
(1/6) of the shares underlying this option on January 30, 2000 and (ii) the
remaining five-sixths (5/6) of the shares underlying this option in 30 equal
monthly increments on the 30th day of each month (or 28th day for February)
beginning February 28, 2000 and ending July 30, 2002.
The right of exercise shall be cumulative so that to the extent the option
is not exercised in any period to the maximum extent permissible it shall
continue to be exercisable, in whole or in part, with respect to all shares for
which it is vested until the earlier of the Final Exercise Date or the
termination of this option under Section 3 hereof or the Plan.
3. EXERCISE OF OPTION.
(a) FORM OF EXERCISE. Each election to exercise this option shall be in
writing, signed by the Participant, and received by the Company at its principal
office, accompanied by this Agreement, and payment in full in the manner
provided in the Plan, including to the extent permitted by the Board in its sole
discretion, by (i) delivery of a promissory note of the
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Participant to the Company on terms determined by the Board (including whether
the Participant must pay cash in an amount equal to the par value of any Common
Stock issued) or (ii) payment of such other lawful consideration as the Board
may determine. The Participant may purchase less than the number of shares
covered hereby, provided that no partial exercise of this option may be for any
fractional share or for fewer than ten whole shares.
(b) CONTINUOUS RELATIONSHIP WITH THE COMPANY REQUIRED. Except as otherwise
provided in this Section 3, this option may not be exercised unless the
Participant, at the time he or she exercises this option, is, and has been at
all times since the Grant Date, an employee (or a person who accepted an offer
for employment and later became and remained an employee), officer or director
of, or consultant or advisor to, the Company or any parent or subsidiary of the
Company as defined in Section 424(e) or (f) of the Code (an "Eligible
Participant").
(c) TERMINATION OF RELATIONSHIP WITH THE COMPANY. If the Participant
ceases to be an Eligible Participant for any reason, then, except as provided in
paragraphs (d) and (e) below, the right to exercise this option shall terminate
three months after such cessation (but in no event after the Final Exercise
Date), provided that this option shall be exercisable only to the extent that
the Participant was entitled to exercise this option on the date of such
cessation. Notwithstanding the foregoing, if the Participant, prior to the Final
Exercise Date, violates the non-competition or confidentiality provisions of any
employment contract, confidentiality and nondisclosure agreement or other
agreement between the Participant and the Company, the right to exercise this
option shall terminate immediately upon written notice to the Participant from
the Company describing such violation.
(d) EXERCISE PERIOD UPON DEATH OR DISABILITY. If the Participant dies or
becomes disabled (within the meaning of Section 22(e)(3) of the Code) prior to
the Final Exercise Date while he or she is an Eligible Participant and the
Company has not terminated such relationship for "cause" as specified in
paragraph (e) below, this option shall be exercisable, within the period of one
year following the date of death or disability of the Participant, by the
Participant, provided that this option shall be exercisable only to the extent
that this option was exercisable by the Participant on the date of his or her
death or disability, and further provided that this option shall not be
exercisable after the Final Exercise Date.
(e) DISCHARGE FOR CAUSE. If the Participant, prior to the Final Exercise
Date, is discharged by the Company for "cause" (as defined below), the right to
exercise this option shall terminate immediately upon the effective date of such
discharge. "Cause" shall mean willful misconduct by the Participant or willful
failure by the Participant to perform his or her responsibilities to the Company
(including, without limitation, breach by the Participant of any provision of
any employment, consulting, advisory, nondisclosure, non-competition or other
similar agreement between the Participant and the Company), as determined by the
Company, which determination shall be conclusive. The Participant shall be
considered to have been discharged for "Cause" if the Company determines, within
30 days after the Participant's resignation, that discharge for cause was
warranted.
4. RIGHT OF FIRST REFUSAL.
(a) If the Participant proposes to sell, assign, transfer, pledge,
hypothecate or
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otherwise dispose of, by operation of law or otherwise (collectively,
"transfer") any Shares acquired upon exercise of this option, then the
Participant shall first give written notice of the proposed transfer (the
"Transfer Notice") to the Company. The Transfer Notice shall name the proposed
transferee and state the number of such Shares the Participant proposes to
transfer (the "Offered Shares"), the price per share and all other material
terms and conditions of the transfer.
(b) For 30 days following its receipt of such Transfer Notice, the Company
shall have the option to purchase any or all of the Offered Shares at the price
and upon the terms set forth in the Transfer Notice. In the event the Company
elects to purchase any of the Offered Shares, it shall give written notice of
such election to the Participant within such 30-day period. Within 10 days after
his receipt of such notice, the Participant shall tender to the Company at its
principal offices the certificate or certificates representing that portion of
the Offered Shares to be purchased by the Company, duly endorsed in blank by the
Participant or with duly endorsed stock powers attached thereto, all in a form
suitable for transfer of the Offered Shares to the Company. Promptly following
receipt of such certificate or certificates, the Company shall deliver or mail
to the Participant a check in payment of the purchase price for the Offered
Shares; PROVIDED THAT if the terms of payment set forth in the Transfer Notice
were other than cash against delivery, the Company may pay for the Offered
Shares on the same terms and conditions as were set forth in the Transfer
Notice; and PROVIDED FURTHER that any delay in making such payment shall not
invalidate the Company's exercise of its option to purchase the Offered Shares.
(c) To the extent the Company does not elect to acquire all of the Offered
Shares, the Participant may, within the 30-day period following the expiration
of the option granted to the Company under subsection (b) above, transfer to the
proposed transferee that portion of the Offered Shares not purchased by the
Company, PROVIDED THAT such transfer shall not be on terms and conditions more
favorable to the transferee than those contained in the Transfer Notice.
Notwithstanding any of the above, all Offered Shares transferred pursuant to
this Section 4 shall remain subject to the right of first refusal set forth in
this Section 4 and such transferee shall, as a condition to such transfer,
deliver to the Company a written instrument confirming that such transferee
shall be bound by all of the terms and conditions of this Section 4.
(d) After the time at which the Offered Shares are required to be
delivered to the Company for transfer to the Company pursuant to subsection (b)
above, the Company shall not pay any dividend to the Participant on account of
such Offered Shares or permit the Participant to exercise any of the privileges
or rights of a stockholder with respect to such Offered Shares, but shall, in so
far as permitted by law, treat the Company as the owner of such Offered Shares.
(e) The following transactions shall be exempt from the provisions of this
Section 4:
1. any transfer of Shares to or for the benefit of any spouse, child
or grandchild of the Participant, or to a trust for their benefit;
2. any transfer pursuant to an effective registration statement
filed by the Company under the Securities Act of 1933, as amended (the
"Securities Act"); and
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3. the sale of all or substantially all of the shares of capital
stock of the Company (including pursuant to a merger or consolidation);
PROVIDED, HOWEVER, that in the case of a transfer pursuant to clause (1) above,
such Shares shall remain subject to the right of first refusal set forth in this
Section 4 and such transferee shall, as a condition to such transfer, deliver to
the Company a written instrument confirming that such transferee shall be bound
by all of the terms and conditions of this Section 4.
(f) The Company may assign its rights to purchase Offered Shares in any
particular transaction under this Section 4 to one or more persons or entities.
(g) The provisions of this Section 4 shall terminate upon the earlier of
the following events:
1. the closing of the sale of shares of Common Stock in an
underwritten public offering pursuant to an effective registration statement
filed by the Company under the Securities Act; or
2. the sale of all or substantially all of the capital stock, assets
or business of the Company, by merger, consolidation, sale of assets or
otherwise (other than a merger or consolidation in which all or substantially
all of the individuals and entities who were beneficial owners of the Common
Stock immediately prior to such transaction beneficially own, directly or
indirectly, more than 75% of the outstanding securities entitled to vote
generally in the election of directors of the resulting, surviving or acquiring
corporation in such transaction).
(h) The Company shall not be required (a) to transfer on its books any of
the Shares which shall have been sold or transferred in violation of any of the
provisions set forth in this Section 4, or (b) to treat as owner of such Shares
or to pay dividends to any transferee to whom any such Shares shall have been so
sold or transferred.
5. AGREEMENT IN CONNECTION WITH PUBLIC OFFERING.
The Participant agrees, in connection with the initial underwritten public
offering of the Company's securities pursuant to a registration statement under
the Securities Act, (i) not to sell, make short sale of, loan, grant any options
for the purchase of, or otherwise dispose of any shares of Common Stock held by
the Participant (other than those shares included in the offering) without the
prior written consent of the Company or the underwriters managing such initial
underwritten public offering of the Company's securities for a period of 180
days from the effective date of such registration statement, and (ii) to execute
any agreement reflecting clause (i) above as may be requested by the Company or
the managing underwriters at the time of such offering.
6. WITHHOLDING.
No Shares will be issued pursuant to the exercise of this option unless and
until the Participant pays to the Company, or makes provision satisfactory to
the Company for payment of, any federal, state or local withholding taxes
required by law to be withheld in respect of this option.
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7. NONTRANSFERABILITY OF OPTION.
This option may not be sold, assigned, transferred, pledged or otherwise
encumbered by the Participant, either voluntarily or by operation of law, except
by will or the laws of descent and distribution, and, during the lifetime of the
Participant, this option shall be exercisable only by the Participant.
8. DISQUALIFYING DISPOSITION.
If the Participant disposes of Shares acquired upon exercise of this option
within two years from the Grant Date or one year after such Shares were acquired
pursuant to exercise of this option, the Participant shall notify the Company in
writing of such disposition.
9. PROVISIONS OF THE PLAN.
This option is subject to the provisions of the Plan, a copy of which is
furnished to the Participant with this option.
IN WITNESS WHEREOF, the Company has caused this option to be executed under
its corporate seal by its duly authorized officer. This option shall take effect
as a sealed instrument.
HOUSTON STREET EXCHANGE, INC.
Granted: July 30, 1999
Amended and Restated: January 10, 2000 By: /s/ Xxxx Xxxxxxxxxxx
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Xxxx Xxxxxxxxxxx, Director
Accepted and Agreed:
/s/ Xxxxx X. Xxxxxx Xx.
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Xxxxx X. Xxxxxx Xx.
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