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EXHIBIT 10.4
INCENTIVE STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT (this "Agreement"), is made and effective
as of this ___ day of ________, 1998, by and between Xxxxx-Xxxxxxx &
Associates, Inc., a Florida corporation (the "Company") with its principal
place of business at 0000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxxx Xxxxx, Xxxxxxx
00000-0000, and _________________________ (the "Optionee").
RECITALS
Pursuant to the Xxxxx-Xxxxxxx & Associates, Inc. 1998 Stock Option
Plan (the "Plan"), the Company desires to grant to the Optionee, and the
Optionee desires to accept, an option to purchase shares of the Company's
common stock, $.01 par value per share (the "Common Stock"), upon the terms and
conditions set forth in this Agreement.
TERMS OF AGREEMENT
In consideration of the mutual representations, warranties, covenants
and conditions contained herein, and for other good and valuable consideration,
the receipt and adequacy of which is hereby acknowledged, the parties hereto
hereby agree as follows:
1. GRANT OF OPTION
Subject to the terms and conditions of this Agreement, the Company
hereby grants to the Optionee an incentive stock option (the "Option") to
purchase an aggregate of ______________ (___) shares (the "Option Shares") of
Common Stock. This Option is intended to be treated as an option which
qualifies as an "incentive stock option" within the meaning of Section 422 of
the Internal Revenue Code of 1986, as amended (the "Code").
2. EXERCISE PRICE
The exercise price ("Option Price") of this Option shall be $4.53 per
Option Share; PROVIDED, HOWEVER, that in the event that the Company completes
an initial public offering of Common Stock under the Securities Act by July 1,
1999, then immediately upon the closing thereof the Option Price shall
automatically be adjusted to equal the price at which shares of Common Stock
are offered for sale to the public pursuant to such offering. The Option Price
of this Option shall be subject to adjustment in the event of changes in the
capitalization of the Company, as set forth in Section 8 hereto.
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3. TERM AND VESTING OF OPTION
(a) OPTION PERIOD. Subject to the provisions of the Plan, this Option
shall terminate and all rights to purchase shares hereunder shall cease on the
ten year anniversary of the Grant Date.
(b) VESTING. Subject to the provisions of the Plan, this Option shall
become exercisable with respect to 25% of the total number of shares subject to
this Option on the date that is 12 months after the Grant Date (the "Vesting
Date") and with respect to an additional 25% of the number of such shares on
each of the next three succeeding anniversaries of the Vesting Date.
Notwithstanding the foregoing, the Board of Directors of the Company ("Board")
may in its discretion provide that any vesting requirement or other such
limitation on the exercise of this Option may be rescinded, modified or waived
by the Board, in its sole discretion, at any time and from time to time after
the Grant Date, so as to accelerate the time at which this Option may be
exercised.
(c) CHANGE IN CONTROL. In the event of a Change in Control (as defined
below), all rights to acquire Option Shares hereunder shall become immediately
exercisable in full, without regard to any limitation on exercise imposed
pursuant to Section 3(b) above. For purposes of this Agreement, a "Change in
Control" shall be deemed to occur if any person shall (a) acquire direct or
indirect beneficial ownership of more than 50% of the total combined voting
power with respect to the election of directors of the issued and outstanding
stock of the Company (except that no Change in Control shall be deemed to have
occurred if the persons who were stockholders of the Company immediately before
such acquisition own all or substantially all of the voting stock or other
interests of such person immediately after such transaction), or (b) have the
power (whether as a result of stock ownership, revocable or irrevocable
proxies, contract or otherwise) or ability to elect or cause the election of
directors consisting at the time of such election of a majority of the Board.
For purposes of this Agreement, a "person" shall mean any person, corporation,
partnership, joint venture or other entity or any group (as such term is
defined for purposes of Section 13(d) of the Exchange Act) and "beneficial
ownership" shall be determined in accordance with Rule 13d-3 under the Exchange
Act.
4. TRANSFERABILITY OF OPTION
This Option shall not be assignable or transferable by the Optionee,
other than by will or the laws of descent and distribution.
5. REQUIREMENTS OF LAW
(a) VIOLATIONS OF LAW. The Company shall not be required to sell or
issue any shares of Common Stock under this Option if the sale or issuance of
such shares would constitute a violation by the individual exercising the
Option or the Company of any provisions of any law or regulation of any
governmental authority, including without limitation, any federal or state
securities laws or regulations. Any determination in this connection by the
Board shall be final, binding, and conclusive. The Company shall not be
obligated to take any affirmative action in order to cause the exercise of
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the Option or the issuance of shares pursuant thereto to comply with any law or
regulation of any governmental authority.
(b) REGISTRATION. At the time of any exercise of this Option, the
Company may, if it shall determine it necessary or desirable for any reason,
require the Optionee (or his or her heirs, legatees or legal representative, as
the case may be), as a condition to the exercise thereof, to deliver to the
Company a written representation of present intention to purchase the shares
for their own account as an investment and not with a view to, or for sale in
connection with, the distribution of such shares, except in compliance with
applicable federal and state securities laws with respect thereto. In the event
such representation is required to be delivered, an appropriate legend may be
placed upon each certificate delivered to the Optionee (or his or her heirs,
legatees or legal representative, as the case may be) upon his or her exercise
of part or all of the Option and a stop transfer order may be placed with the
transfer agent. The Option shall also be subject to the requirement that, if at
any time the Company determines, in its discretion, that the listing,
registration or qualification of the shares subject to the Option upon any
securities exchange or under any state or federal law, or the consent or
approval of any governmental regulatory body is necessary or desirable as a
condition of or in connection with, the issuance or purchase of the shares
thereunder, the Option may not be exercised in whole or in part unless such
listing, registration, qualification, consent or approval shall have been
effected or obtained free of any conditions not acceptable to the Company in
its sole discretion. Optionee agrees to execute any "lock-up" or similar
agreement required by the Company's underwriters in connection with the
Company's initial public offering. The Company shall not be obligated to take
any affirmative action in order to cause the exercisability or vesting of the
Option or to cause the exercise of the Option or the issuance of shares
pursuant thereto to comply with any law or regulation of any governmental
authority.
(c) WITHHOLDING. The Board may make such provisions and take such steps
as it may deem necessary or appropriate for the withholding of any taxes that
the Company is required by any law or regulation of any governmental authority,
whether federal, state or local, domestic or foreign, to withhold in connection
with the exercise of the Option, including, but not limited to, (i) the
withholding of delivery of shares of Common Stock upon exercise of the Option
until the holder reimburses the Company for the amount the Company is required
to withhold with respect to such taxes, (ii) the canceling of any number of
shares of Common Stock issuable upon exercise of the Option in an amount
sufficient to reimburse the Company for the amount it is required to so
withhold, or (iii) withholding the amount due from Optionee's wages or
compensation due such person.
6. DISCLAIMER OF RIGHTS
No provision of this Agreement shall be construed to confer upon any
individual, including Optionee, the right to remain in the employ of the
Company or any Subsidiary or to interfere in any way with the right and
authority of the Company or any Subsidiary either to increase or decrease the
compensation of any individual, including Optionee, at any time, or to
terminate any employment or other relationship between any individual,
including Optionee, and the Company or any Subsidiary.
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7. PROVISIONS OF THE PLAN
The provisions of the Plan shall govern if and to the extent that there
are inconsistencies between those provisions and the provisions of this
Agreement. By execution of this Agreement, the Optionee acknowledges receipt of
a copy of the Plan and represents that he (i) is familiar with the terms and
provisions of the Plan, (ii) accepts the Option subject to all of the terms and
provisions of the Plan, and (iii) after reviewing the Plan and this Agreement
in their entirety, has had the opportunity to obtain the advice of counsel
prior to executing this Agreement and fully understands all of the provisions
of this Agreement and the Plan prior to execution of this Agreement.
8. MISCELLANEOUS
(a) NO WAIVER. Neither the failure nor any delay on the part of either
party to exercise any right, remedy, power or privilege under this Agreement
shall operate as a waiver thereof, nor shall any single or partial exercise of
any right, remedy, power or privilege preclude any other or further exercise of
the same or of any other right, remedy, power or privilege, nor shall any
waiver of any right, remedy, power or privilege with respect to any occurrence
be construed as a waiver of such right, remedy, power or privilege with respect
to any other occurrence. No waiver shall be effective unless it is in writing
and is signed by the party asserted to have granted such waiver.
(b) INCORPORATION OF DEFINITIONS. Unless otherwise provided in this
Agreement, capitalized terms used and not otherwise defined in this Agreement
shall have the respective meanings ascribed to them in the Plan.
(c) CONTROLLING LAW. This Agreement and all questions relating to its
validity, interpretation, performance and enforcement (including, without
limitation, provisions concerning limitations of actions), shall be governed by
and construed in accordance with the laws of the State of Delaware, without
application to the principles of conflict of laws.
(d) NOTICES. All notices, requests, demands and other communications
required or permitted under this Agreement shall be in writing and shall be
deemed to have been duly given, made and received only when personally
delivered, one day following the day when deposited with an overnight courier
service for overnight priority service, such as Federal Express, for delivery
to the intended addressee or three days following the day when deposited in the
United States mails, first class postage prepaid, certified or registered mail,
and addressed, in the case of the Company, as set forth in the first paragraph
of this Agreement, and, in the case of Optionee, as set forth below Optionee's
signature on the last page hereof. Any person may alter the address to which
communications or copies are to be sent by giving notice of such change of
address in conformity with the provisions of this Section for the giving of
notice.
(e) BINDING NATURE OF AGREEMENT; TRANSFERABILITY. This Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective heirs, personal representatives,
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successors and assigns. This Agreement shall not be assignable or transferable
by the Optionee other than by will or the laws of descent and distribution.
(f) SEVERABILITY. The provisions of this Agreement are independent of
and separable from each other, and no provision shall be affected or rendered
invalid or unenforceable by virtue of the fact that for any reason any other or
others of them may be invalid or unenforceable in whole or in part.
(g) SECTION HEADINGS. The section headings in this Agreement are for
convenience only; they form no part of this Agreement and shall not affect its
interpretation.
(h) NUMBER OF DAYS. In computing the number of days for purposes of
this Agreement, all days shall be counted, including Saturdays, Sundays and
holidays; PROVIDED, HOWEVER that if the final day of any time period falls on a
Saturday, Sunday or holiday on which federal banks are or may elect to be
closed, then the final day shall be deemed to be the next day which is not a
Saturday, Sunday or such holiday.
(i) NO THIRD-PARTY BENEFICIARIES. This Agreement shall not confer any
rights or remedies upon any person other than the parties and their respective
successors and permitted assigns.
(j) ENTIRE AGREEMENT; AMENDMENTS. This Agreement fulfills and satisfies
in full the Company's commitment to issue stock options to the Optionee as of
the date of Optionee's employment with the Company which began on the Grant
Date, as an inducement to Optionee to accept employment with the Company. This
Agreement (including the documents and exhibits referred to herein) constitutes
the entire agreement among the parties and supersedes any prior understandings,
agreements, or representations by or among the parties, written or oral, that
may have related in any way to the subject matter hereof. This Agreement may
not be amended, supplemented or modified in whole or in part except by an
instrument in writing signed by the party or parties against whom enforcement
of any such amendment, supplement or modification is sought.
(k) CONSTRUCTION. The language used in this Agreement will be deemed to
be the language chosen by the parties to express their mutual intent, and
thereof strict construction shall be applied against any party. Any reference
to any federal, state, local or foreign statute or law shall be deemed also to
refer to the rules and regulations promulgated thereunder, unless the context
requires otherwise. The parties intend that each representation, warranty, and
covenant contained herein shall have independent significance. If any party has
breached any representation, warranty, or covenant contained herein in any
respect, the fact that there exists another representation, warranty or
covenant relating to the same subject matter (regardless of the relative levels
of specificity) which the party has not breached shall not detract from or
mitigate the fact that the party is in breach of the first representation,
warranty or covenant.
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(l) COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed an original and all of which
together will constitute one and the same instrument.
(m) PRONOUNS. The use of any gender in this Agreement shall be deemed
to include all genders, and the use of the singular shall be deemed to include
the plural and vice versa, wherever it appears appropriate from the context.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
day and year first above written.
XXXXX-XXXXXXX & ASSOCIATES, INC.
By: /s/ Xxxxxxx Xxxxx
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Name: Xxxxxxx Xxxxx
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Title: President
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OPTIONEE:
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Address:
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