EXHIBIT L
MOBILITY ELECTRONICS, INC.
INCENTIVE OPTION AGREEMENT
This Incentive Stock Option Agreement (the "Agreement"), dated as of
MARCH 22, 2002, is entered into between Mobility Electronics, Inc., a Delaware
corporation (the "Company"), and XXXXXXX X. XXXXX, an employee of the Company
(the "Optionee"). In consideration of the mutual promises and covenants made
herein, the parties hereby agree as follows:
1. GRANT OF OPTION. Under the terms and conditions of the Company's
Amended and Restated 1996 Long Term Incentive Plan (the "Plan"), a copy of which
is attached hereto and incorporated herein by reference, the Company grants to
the Optionee an option (the "Option") to purchase from the Company all or any
part of a total of THIRTY ONE THOUSAND EIGHT HUNDRED SIXTY (31,860) shares of
the Company's Common Stock, par value $.01 per share, at a price of $1.27 per
share. The Option is granted as of the date first above written (the "Date of
Grant").
2. CHARACTER OF OPTION. The Option is an "incentive stock option"
within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended.
3. TERM. The Option will expire on the fifth anniversary of the Date of
Grant or, in the event of the Optionee's termination of employment with the
Company, on such earlier date as may be provided in Section 6(b) of the Plan.
4. VESTING. Subject to the provisions of Section 6(b) of the Plan, the
Option may be exercised according to the following schedule:
PERCENTAGE EXERCISABLE PERIOD
----------------------------- ------------------------------
100.00% March 22, 2002
The unexercised portion of the Option from one period may be carried over to a
subsequent period or periods, and the right of the Optionee to exercise the
Option as to such unexercised portion shall continue for the entire term.
5. PROCEDURE FOR EXERCISE. Exercise of the Option or a portion thereof
shall be effected by the giving of written notice to the Company and payment of
the purchase price prescribed in Section 1 above for the shares to be acquired
pursuant to the exercise.
6. PAYMENT OF PURCHASE PRICE. Payment of the purchase price for any
shares purchased pursuant to the Option shall be in cash, unless otherwise
agreed to in writing by the Compensation Committee of the Board of Directors of
the Company.
7. TRANSFER OF OPTIONS. The Option may not be transferred except by
will or the laws of descent and distribution and, during the lifetime of the
Optionee, may be exercised only by the Optionee or by the Optionee's legally
authorized representative.
8. TERMINATION. The Option shall terminate on the earlier of (i) the
expiration date set forth in Section 3 above or, (ii) in the event of the
termination of the Optionee's employment, the date provided in Section 6(b) of
the Plan.
1
9. ACCEPTANCE OF THE PLAN. The Option is granted subject to all of the
applicable terms and provisions of the Plan, and such terms and provisions are
incorporated by reference herein. The Optionee hereby accepts and agrees to be
bound by all the terms and conditions of the Plan.
10. CONFIDENTIALITY AND NONCOMPETITION. In consideration of the grant
of Option hereunder, Optionee agrees to the following:
(a) Acknowledgment of Proprietary Interest. Optionee recognizes the
proprietary interest of the Company and its affiliates in any Trade
Secrets (as hereinafter defined) of the Company and its affiliates.
Optionee acknowledges and agrees that any and all Trade Secrets
currently known by Optionee or learned by Optionee during the course of
his engagement by the Company or otherwise, whether developed by
Optionee alone or in conjunction with others or otherwise, shall be and
is the property of the Company and its affiliates. Optionee further
acknowledges and understands that his disclosure of any Trade Secrets
will result in irreparable injury and damage to the Company and its
affiliates. As used herein, "Trade Secrets" means all confidential and
proprietary information of the Company and its affiliates, now owned or
hereafter acquired, including, without limitation, information derived
from reports, investigations, experiments, research, work in progress,
drawings, designs, plans, proposals, codes, marketing and sales
programs, client lists, client mailing lists, financial projections,
cost summaries, pricing formula, and all other concepts, ideas,
materials, or information prepared or performed for or by the Company
or its affiliates and information related to the business, products or
sales of the Company or its affiliates, or any of their respective
customers, other than information which is otherwise publicly
available; provided, however, "Trade Secrets" does not include any
information that is known or readily obtainable by companies within the
computer industry.
(b) Optionee acknowledges and agrees that the Company and its
affiliates are entitled to prevent the disclosure of Trade Secrets. As
consideration for the grant of the options hereunder to Optionee by the
Company, Optionee agrees at all times during his employment with the
Company and thereafter to hold in strict confidence and not to disclose
or allow to be disclosed to any person, firm or corporation, other than
to persons engaged by the Company and its affiliates to further the
business of the Company and its affiliates, and not to use except in
the pursuit of the business of the Company and its affiliates, the
Trade Secrets, without the prior written consent of the Company,
including Trade Secrets developed by Optionee.
(c) Return of Materials at Termination. In the event of any termination
or cessation of his employment with the Company for any reason
whatsoever, Optionee will promptly deliver to the Company all
documents, data and other information pertaining to Trade Secrets.
Optionee shall not take any documents or other information, or any
2
reproduction or excerpt thereof, containing or pertaining to any Trade
Secrets.
(d) Competition During Employment. Optionee agrees that during his
employment with the Company, neither he, nor any of his affiliates,
will directly or indirectly compete with the Company or its affiliates
in the portable or handheld computer power, docking, and connectivity
business, which is defined as product lines or businesses that are
competitive with products that are manufactured, marketed or sold by
the Company and its affiliates during the term of his employment or
under development during the term of his employment (the "Business");
and that he will not act as an officer, director, employee, consultant,
shareholder, lender, or agent of any entity which is competitive with
the Business; provided, however, that this Section shall not prohibit
Optionee or any of his affiliates from purchasing or holding an
aggregate equity interest of up to 1% in any business in competition
with the Business. Furthermore, Optionee agrees that during his
employment with the Company, he will undertake no planning for the
organization of any business activity competitive with the Business and
Optionee will not combine or conspire with any other Optionees of the
Company and its affiliates for the purpose of the organization of any
such competitive business activity.
(e) Competition Following Employment. Optionee agrees that for a period
of one-year after the termination or cessation of his employment for
the Company for any reason whatsoever, neither he, nor any of his
affiliates, will directly or indirectly: (1) compete with the Company
or its affiliates in the Business, and that he will not act as an
officer, director, Optionee, consultant, shareholder, lender, or agent
of any entity which is engaged in the Business; provided, however, that
this Section shall not prohibit Optionee or any of his affiliates from
purchasing or holding an aggregate equity interest of up to 1% in any
business in competition with the Business. Furthermore, Optionee will
not combine or conspire with any other Optionees of the Company and its
affiliates for the purpose of the organization of any such competitive
business activity.
11. INVENTIONS. In consideration of the grant of Option hereunder,
Optionee agrees to the following:
(a) Disclosure to Company. Optionee agrees to promptly disclose to the
Company any and all inventions, discoveries, improvements, trade
secrets, formulas, compositions, code, designs, programs, techniques,
processes, and know-how, whether or not reduced to writing or practice,
conceived by Optionee during the period of his or her employment with
the Company, either alone or jointly with others, which relate to or
result from the actual or anticipated business, work, research or
investigations of the Company, or which result, to any extent, from use
of the Company's premises or property (the work being hereinafter
collectively referred to as the "Intellectual Property"). Further,
Optionee shall disclose in confidence to the Company all patent and
copyright applications filed by or on behalf
3
of Optionee during the term of his employment with the Company and, to
the extent such application related to the business of the Company at
the date Optionee's employment terminates, for a period of three (3)
years thereafter.
(b) Intellectual Property as Sole Property of the Company. Optionee
acknowledges and agrees that all the Intellectual Property shall be the
sole property of Optionee or any other entity designated by it, and
Optionee hereby assigns to the Company his or her entire right and
interest in and to all Intellectual Property. Optionee further agrees
as to all Intellectual Property to assist the Company in every way (at
the Company's expense) to obtain and from time to time enforce patents
and copyrights on the Intellectual Property in any and all countries
during the term of this Agreement. To that end, by way of illustration
but not limitation, Optionee will testify in any suit or other
proceeding involving any of the Intellectual Property, execute all
documents which the Company reasonably determines to be necessary or
convenient for use in applying for and obtaining patents and copyrights
thereon and enforcing same, and execute all necessary assignments
thereof to the Company or persons designated by it. Optionee's
obligation to assist the Company in obtaining and enforcing patents and
copyrights for the Intellectual Property shall continue beyond the
termination of his employment, but the Company shall compensate
Optionee at a reasonable rate after such termination for the time
actually spent by Optionee at the Company's request on such assistance
and the Company's requests for assistance shall be reasonable in light
of Optionee's then existing business commitments. Optionee hereby
irrevocably appoints the Company, and its duly authorized officers and
agents, as Optionee's agent and attorney-in-fact to act for and on
behalf of Optionee in filing all patent and copyright applications,
amendments, renewals, and all other appropriate documents in any way
related to Intellectual Property. The Company will promptly notify
Optionee following any such filing, provided that the Company will not
be obligated to make such notification if as a result the Company would
be in violation of any agreement or order to which it is subject or
bound.
(c) List of Prior Inventions. As a matter of record, Optionee has set
forth on Exhibit "A" attached hereto a complete list separately
identifying each invention, discovery, improvement, trade secret,
formula, composition, code, design, program, technique, process and
know-how made or discovered by Optionee prior to his employment with
the Company. Optionee represents and covenants that such list is
complete. As a matter of record, Optionee has set forth on Exhibit "A"
attached hereto a complete list of all inventions, programs,
discoveries, or improvements relating to the Company's business which
have been made by Optionee prior to his employment with the Company.
Optionee represents and covenants that such list is complete. All such
matters set forth in Exhibit "A", if any, which Optionee made prior to
his employment by the Company are excluded from the scope of this
Agreement.
4
(D) TIME OF INVENTION; PRESUMPTION. For the purposes of this Agreement,
an invention or other Intellectual Property is deemed to have been made
or conceived during the duration of employment if during such time, the
invention or other Intellectual Property was conceived or first
actually reduced to writing or practice; and Optionee agrees that any
disclosure of an invention, Intellectual Property or any patent or
copyright application made within one (1) year after termination of his
employment shall be presumed to relate to an invention or other
Intellectual Property which was made or conceived during the term of
Optionee's employment unless Optionee provides satisfactory and
compelling evidence to the contrary.
(e) Training and Experience. Nothing herein is intended to prevent or
restrict the use by Optionee of Optionee's education, training and
experience, except insofar as is expressly provided.
AMENDMENT. This Agreement may be amended by an instrument in writing
signed by both the Company and the Optionee.
12. MISCELLANEOUS. This Agreement will be construed and enforced in
accordance with the laws of the State of
Delaware and will be binding upon and
inure to the benefit of any successor or assign of the Company and any executor,
administrator, trustee, guardian or other legal representative of the Optionee.
Executed as of the date first above written.
MOBILITY ELECTRONICS, INC.
By: /s/ XXXXXXX X. XXXXX
------------------------------------
Xxxxxxx X. Xxxxx
Chief Executive Officer
OPTIONEE:
/s/ XXXXXXX X. XXXXX
------------------------------------
Xxxxxxx X. Xxxxx
###-##-####
------------------------------------
Social Security Number of Optionee
5
