CLEAR SKIES SOLAR, INC. FORM OF INCENTIVE STOCK OPTION AGREEMENT
Exhibit
10.44
2009
EQUITY INCENTIVE PLAN
FORM OF
INCENTIVE STOCK OPTION AGREEMENT
This
INCENTIVE STOCK OPTION AGREEMENT (the “Option Agreement”), dated as of
the day
of , 20 (the “Grant Date”), is between
Clear Skies Solar, Inc., a Delaware corporation (the “Company”),
and (the
“Optionee”), a key employee of the Company or of a Subsidiary of the Company (a
“Related Corporation”), pursuant to the Clear Skies Solar, Inc. 2009 Equity
Incentive Plan (the “Plan”).
WHEREAS,
the Company desires to give the Optionee the opportunity to purchase shares of
common stock of the Company, par value $0.001 (“Common Shares”) in accordance
with the provisions of the Plan, a copy of which is attached
hereto;
NOW
THEREFORE, in consideration of the mutual covenants hereinafter set forth and
for other good and valuable consideration, the parties hereto, intending to be
legally bound hereby, agree as follows:
1.
Grant of Option. The
Company hereby grants to the Optionee the right and option (the “Option”) to
purchase all or any part of an aggregate
of ( ) Common Shares. The
Option is in all respects limited and conditioned as hereinafter provided, and
is subject in all respects to the terms and conditions of the Plan now in effect
and as it may be amended from time to time (but only to the extent that such
amendments apply to outstanding options). Such terms and conditions are
incorporated herein by reference, made a part hereof, and shall control in the
event of any conflict with any other terms of this Option Agreement. The Option
granted hereunder is intended to be an incentive stock option (“ISO”) meeting
the requirements of the Plan and section 422 of the Internal Revenue Code of
1986, as amended (the “Code”), and not a nonqualified
stock option (“NQSO”).
2. Exercise
Price. The exercise price
of the Common Shares covered by this Option shall be
$ per share. It is the
determination of the committee administering the Plan (the “Committee”), or the
Board of Directors in lieu of the Committee, that on the Grant Date the exercise
price was not less than the greater of (i) 100% (110% for an Optionee who owns
more than 10% of the total combined voting power of all shares of stock of the
Company or of a Related Corporation - a “More-Than-10% Owner”) of the “Fair
Market Value” (as defined in the Plan) of a Common Share, or (ii) the par value
of a Common Share.
3. Term. Unless earlier terminated pursuant to
any provision of the Plan or of this Option Agreement, this Option shall expire
on March 16, 2019 (the “Expiration Date”), which date is not more than 10 years
(five years in the case of a More-Than-10% Owner) from the Grant Date. This
Option shall not be exercisable on or after the Expiration
Date.
4. Exercise of
Option. The Option shall
vest according to the following schedule, provided that Optionee remains
continuously employed as a key employee of the Company or a Related Corporation
from the date hereof through the applicable vesting date:
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Date Installment Becomes
Exercisable
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Number of Shares
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Shares
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an additional Shares
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an additional
Shares
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The
Committee may accelerate any vesting date of the Option, in its discretion, if
it deems such acceleration to be desirable. Once the Option becomes exercisable,
it will remain exercisable until it is exercised or until it
terminates.
5. Method of Exercising
Option. Subject to the terms and conditions of this Option Agreement and
the Plan, the Option may be exercised by written notice to the Company at its
principal office. The form of such notice is attached hereto and shall state the
election to exercise the Option and the number of whole shares with respect to
which it is being exercised; shall be signed by the person or persons so
exercising the Option; and shall be accompanied by payment of the full exercise
price of such shares. Only full shares will be issued.
The
exercise price shall be paid to the Company:
(a) in cash, or by certified check, bank
draft, or postal or express money order;
(b) through the delivery of Common Shares
previously acquired by the Optionee;
(c) by delivering a properly executed
notice of exercise of the Option to the Company and a broker, with irrevocable
instructions to the broker promptly to deliver to the Company the amount
necessary to pay the exercise price of the Option;
(d) in Common Shares newly acquired by the
Optionee upon exercise of the Option (which shall constitute a disqualifying
disposition with respect to this ISO); or
(e) in any combination of (a), (b), (c) or
(d) above.
In the
event the exercise price is paid, in whole or in part, with Common Shares, the
portion of the exercise price so paid shall be equal to the Fair Market Value of
the Common Shares surrendered on the date of exercise.
Upon
receipt of notice of exercise and payment, the Company shall deliver a
certificate or certificates representing the Common Shares with respect to which
the Option is so exercised. The Optionee shall obtain the rights of a
shareholder upon receipt of a certificate(s) representing such Common
Shares.
Such
certificate(s) shall be registered in the name of the person so exercising the
Option (or, if the Option is exercised by the Optionee and if the Optionee so
requests in the notice exercising the Option, shall be registered in the name of
the Optionee and the Optionee’s spouse, jointly, with right of survivorship),
and shall be delivered as provided above to, or upon the written order of, the
person exercising the Option. In the event the Option is exercised by any person
after the death or disability (as determined in accordance with Section 22(e)(3)
of the Code) of the Optionee, the notice shall be accompanied by appropriate
proof of the right of such person to exercise the Option. All Common Shares that
are purchased upon exercise of the Option as provided herein shall be fully paid
and non-assessable.
Upon
exercise of the Option, Optionee shall be responsible for all employment and
income taxes then or thereafter due (whether Federal, State or local), and if
the Optionee does not remit to the Company sufficient cash (or, with the consent
of the Committee, Common Shares) to satisfy all applicable withholding
requirements, the Company shall be entitled to satisfy any withholding
requirements for any such tax by disposing of Common Shares at exercise,
withholding cash from Optionee’s salary or other compensation or such other
means as the Committee considers appropriate to the fullest extent permitted by
applicable law. Nothing in the preceding sentence shall impair or limit the
Company’s rights with respect to satisfying withholding obligations under
Section 10 of the Plan.
6. Non-Transferability
of Option. This Option is
not assignable or transferable, in whole or in part, by the Optionee other than
by will or by the laws of descent and distribution. During the lifetime of the
Optionee, the Option shall be exercisable only by the Optionee or, in the event
of his or her disability, by his or her guardian or legal
representative.
7. Termination
of Employment. If the
Optionee’s employment with the Company and all Related Corporations is
terminated for any reason (other than death or disability) prior to the
Expiration Date, then this Option may be exercised by Optionee, to the extent of
the number of Common Shares with respect to which the Optionee could have
exercised it on the date of such termination of employment, at any time prior to
the earlier of (i) the Expiration Date, or (ii) three months after such
termination of employment. Any part of the Option that was not exercisable
immediately before the termination of Optionee’s employment shall terminate at
that time.
8. Disability. If the
Optionee becomes disabled (as determined in accordance with section 22(e)(3) of
the Code) during his or her employment and, prior to the Expiration Date, the
Optionee’s employment is terminated as a consequence of such disability, then
this Option may be exercised by the Optionee or by the Optionee’s legal
representative, to the extent of the number of Common Shares with respect to
which the Optionee could have exercised it on the date of such termination of
employment at any time prior to the earlier of (i) the Expiration Date or (ii)
one year after such termination of employment. Any part of the Option that was
not exercisable immediately before the Optionee’s termination of employment
shall terminate at that time.
9. Death. If the
Optionee dies during his or her employment and prior to the Expiration Date, or
if the Optionee’s employment is terminated for any reason (as described in
Paragraphs 7 and 8) and the Optionee dies following his or her termination
of employment but prior to the earliest of (i) the Expiration Date, or (ii) the
expiration of the period determined under Paragraph 7 or 8 (as applicable
to the Optionee), then this Option may be exercised by the Optionee’s estate,
personal representative or beneficiary who acquired the right to exercise this
Option by bequest or inheritance or by reason of the Optionee’s death, to the
extent of the number of Common Shares with respect to which the Optionee could
have exercised it on the date of his or her death, at any time prior to the
earlier of (i) the Expiration Date or (ii) one year after the date of the
Optionee’s death. Any part of the Option that was not exercisable immediately
before the Optionee’s death shall terminate at that time.
10. Disqualifying
Disposition of Option Shares. The Optionee agrees to give written
notice to the Company, at its principal office, if a “disposition” of the Common
Shares acquired through exercise of the Option granted hereunder occurs at any
time within two years after the Grant Date or within one year after the transfer
to the Optionee of such shares. Optionee acknowledges that if such disposition
occurs, the Optionee generally will recognize ordinary income as of the date the
Option was exercised in an amount equal to the lesser of (i) the Fair Market
Value of the Common Shares on the date of exercise minus the exercise price, or
(ii) the amount realized on disposition of such shares minus the exercise price.
If requested by the Company at the time of and in the case of any such
disposition, Optionee shall pay to the Company an amount sufficient to satisfy
the Company’s federal, state and local withholding tax obligations with respect
to such disposition. The provisions of this Section 10 shall apply, whether or
not the Optionee is in the employ of the Company at the time of the relevant
disposition. For purposes of this Paragraph, the term “disposition” shall have
the meaning assigned to such term by section 424(c) of the
Code.
11. Securities
Matters. (a) If, at any
time, counsel to the Company shall determine that the listing, registration or
qualification of the Common Shares subject to the Option upon any securities
exchange or under any state or federal law, or the consent or approval of any
governmental or regulatory body, or that the disclosure of non-public
information or the satisfaction of any other condition is necessary as a
condition of, or in connection with, the issuance or purchase of Common Shares
hereunder, such Option may not be exercised, in whole or in part, unless such
listing, registration, qualification, consent or approval, or satisfaction of
such condition shall have been effected or obtained on conditions acceptable to
the Board of Directors. The Company shall be under no obligation to apply for or
to obtain such listing, registration or qualification, or to satisfy such
condition. The Committee shall inform the Optionee in writing of any decision to
defer or prohibit the exercise of an Option. During the period that the
effectiveness of the exercise of an Option has been deferred or prohibited, the
Optionee may, by written notice, withdraw the Optionee’s decision to exercise
and obtain a refund of any amount paid with respect thereto.
(b) The Company may require: (i) the
Optionee (or any other person exercising the Option in the case of the
Optionee’s death or Disability) as a condition of exercising the Option, to give
written assurances, in substance and form satisfactory to the Company, to the
effect that such person is acquiring the Common Shares subject to the Option for
his or her own account for investment and not with any present intention of
selling or otherwise distributing the same, and to make such other
representations or covenants; and (ii) that any certificates for Common Shares
delivered in connection with the exercise of the Option bear such legends, in
each case as the Company deems necessary or appropriate, in order to comply with
federal and applicable state securities laws, to comply with covenants or
representations made by the Company in connection with any public offering of
its Common Shares or otherwise. The Optionee specifically understands and agrees
that the Common Shares, if and when issued upon exercise of the Option, may be
“restricted securities,” as that term is defined in Rule 144 under the
Securities Act of 1933 and, accordingly, the Optionee may be required to hold
the shares indefinitely unless they are registered under such Securities Act of
1933, as amended, or an exemption from such registration is
available.
(c) The Optionee shall have no rights as a
shareholder with respect to any Common Shares covered by the Option (including,
without limitation, any rights to receive dividends or non-cash distributions
with respect to such shares) until the date of issue of a stock certificate to
the Optionee for such Common Shares. No adjustment shall be made for dividends
or other rights for which the record date is prior to the date such stock
certificate is issued.
12. Governing Law. This
Option Agreement shall be governed by the applicable Code provisions to the
maximum extent possible. Otherwise, the laws of the State of Delaware (without
reference to the principles of conflict of laws) shall govern the operation of,
and the rights of the Optionee under, the Plan and Options granted
thereunder.
IN
WITNESS WHEREOF, the Company has caused this Incentive Stock Option Agreement to
be duly executed by its duly authorized officer, and the Optionee has hereunto
set his or her hand and seal, all as of the date first above
written.
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By:
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Name:
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Xxxx
Xxxxx
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Title:
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Chief Executive
Officer
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,
Optionee
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2009
EQUITY INCENTIVE PLAN
Notice of
Exercise of Incentive Stock Option
I hereby
exercise the incentive stock option granted to me pursuant to the Incentive
Stock Option Agreement dated as of ____________ __, 20__, by Clear Skies Solar,
Inc. (the “Company”), with respect to the following number of shares of the
Company’s common stock (“Shares”), par value $0.001 per Share, covered by said
option:
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Number
of Shares to be purchased:
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Purchase
price per Share:
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$ | |||
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Total
purchase price:
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$ | |||
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A.
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Enclosed
is cash or my certified check, bank draft, or postal or express money
order in the amount of $________ in full/partial [circle one] payment for
such Shares;
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and/or
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B.
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Enclosed
is/are Share(s) with a total fair market value of $ on the date hereof in
full/partial [circle
one] payment for such Shares;
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and/or
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C.
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I
have provided notice to [insert name of broker],
a broker, who will render full/partial [circle one] payment for
such Shares. [Optionee
should attach to the notice of exercise provided to such broker a copy of
this Notice of Exercise and irrevocable instructions to pay to the Company
the full/partial (as elected above) exercise
price.]
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and/or
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D.
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I
elect to satisfy the payment for Shares purchased hereunder by having the
Company withhold newly acquired Shares pursuant to the exercise of the
Option. I understand that this will result in a “disqualifying
disposition,” as described in Section 10 of my Incentive Stock Option
Agreement.
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Please have the certificate or
certificates representing the purchased Shares registered in the following name
or names* : ; and sent to .
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DATED:
_____________________, 20__
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Optionee’s
Signature
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*
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Certificates may be registered in
the name of the Optionee alone or in the joint names (with right of
survivorship) of the Optionee and his or her
spouse.
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