Exhibit 10.2(a)
INCENTIVE STOCK OPTION AGREEMENT _____ SHARES OF COMMON STOCK,
NO. $.0001 PAR VALUE PER SHARE
SYNTA PHARMACEUTICALS CORP.
_________________, 2005
As of _________ (the "Grant Date"), Synta Pharmaceuticals Corp. (the
"Company"), a Delaware corporation, grants to _______________ (the "Employee")
the right and option (the "Option") to purchase up to _________ shares of the
Common Stock, $.0001 par value per share, of the Company (the "Shares") at a
purchase price of $________ per share (the "Purchase Price") and on the terms
and subject to the conditions set forth in the Company's 0000 Xxxxx Xxxx (xxx
"Xxxx"), Xxxxxx Xxxxxx securities and tax laws and this Agreement.
THIS AGREEMENT DOES NOT SET FORTH ALL OF THE TERMS AND CONDITIONS OF THE
PLAN, WHICH IS HEREBY INCORPORATED INTO AND MADE A PART OF THIS AGREEMENT BY
REFERENCE. ANY TERMS USED AND NOT DEFINED HEREIN HAVE THE SAME MEANINGS AS IN
THE PLAN. THE PARTICIPANT ACKNOWLEDGES THAT HE OR SHE HAS RECEIVED A COPY OF THE
PLAN FROM THE COMPANY AND HAS CAREFULLY READ THE TERMS AND CONDITIONS OF THE
PLAN AND THIS AGREEMENT.
SYNTA PHARMACEUTICALS CORP.
By: ____________________________________
Its: ____________________________________
1. GRANT OF OPTION.
The Company hereby grants to the Employee the right and option to purchase
all or any part of an aggregate of _______________ Shares, on the terms and
conditions and subject to all the limitations set forth herein, under United
States securities and tax laws, and in the Plan, which is incorporated herein by
reference. The Employee acknowledges receipt of a copy of the Plan. The Option
is intended to qualify for special federal tax treatment as an "incentive stock
option" pursuant to Section 422 of the Internal Revenue Code of 1986, as amended
(the "Code").
2. PURCHASE PRICE.
The purchase price of the Shares covered by the Option shall be $_____ per
Share, subject to adjustment, as provided in the Plan, in the event of a stock
split, reverse stock split or other events affecting the holders of Shares (the
"Purchase Price"). Payment shall be made in accordance with Section 9 of the
Plan.
3. EXERCISABILITY OF OPTION.
Subject to the terms and conditions set forth in this Agreement and the
Plan, the Option granted hereby shall become exercisable in cumulative
installments of (i) 25% of the Shares on ________________________, and (ii)
6.25% of the Shares on the last day of each calendar quarter thereafter.
Notwithstanding the foregoing, the Option shall become vested and exercisable in
accordance with the terms and conditions set forth in Sections 24B and F of the
Plan.
4. TERM OF OPTION.
The Option shall terminate ten years from the date of this Agreement or, if
the Employee owns as of the date hereof more than 10% of the total combined
voting power of all classes of capital stock of the Company or an Affiliate,
five years from the date of this Agreement, but shall be subject to earlier
termination as provided herein or in the Plan.
If the Employee ceases to be an employee of the Company or of an Affiliate
(for any reason other than the death or Disability of the Employee or
termination of the Employee's employment for "cause" [(AS DEFINED IN THE PLAN)
CONSIDER OTHER DEFINITIONS]), the Option may be exercised, if it has not
previously terminated, within three months after the date the Employee ceases to
be an employee of the Company or an Affiliate, or within the originally
prescribed term of the Option, whichever is earlier, but may not be exercised
thereafter. In such event, the Option shall be exercisable only to the extent
that the Option has become exercisable and is in effect at the date of such
cessation of employment.
Notwithstanding the foregoing, in the event of the Employee's Disability or
death within three months after the termination of employment, the Employee or
the Employee's Survivors may exercise the Option within one year after the date
of the Employee's termination of employment, but in no event after the date of
expiration of the term of the Option.
In the event the Employee's employment is terminated by the Employee's
employer for "cause" [(AS DEFINED IN THE PLAN)], the Employee's right to
exercise any unexercised portion of this Option shall cease immediately as of
the time the Employee is notified his or her employment is terminated for
"cause," and this Option shall thereupon terminate. Notwithstanding anything
herein to the contrary, if subsequent to the Employee's termination as an
employee, but prior to the exercise of the Option, the Board of Directors of the
Company determines that, either prior or subsequent to the Employee's
1
termination, the Employee engaged in conduct which would constitute "cause,"
then the Employee shall immediately cease to have any right to exercise the
Option and this Option shall thereupon terminate.
In the event of the Disability of the Employee, as determined in accordance
with the Plan, the Option shall be exercisable within one year after the
Employee's termination of employment or, if earlier, within the term originally
prescribed by the Option. In such event, the Option shall be exercisable:
(a) to the extent that the Option has become exercisable but has not
been exercised as of the date of Disability; and
(b) in the event rights to exercise the Option accrue periodically, to
the extent of a pro rata portion through the date of Disability of
any additional vesting rights that would have accrued on the next
vesting date had the Employee not become Disabled. The proration
shall be based upon the number of days accrued in the current
vesting period prior to the date of Disability.
In the event of the death of the Employee while an employee of the Company
or of an Affiliate, the Option shall be exercisable by the Participant's
Survivors within one year after the date of death of the Employee or, if
earlier, within the originally prescribed term of the Option. In such event, the
Option shall be exercisable:
(x) to the extent that the Option has become exercisable but has not
been exercised as of the date of death; and
(y) in the event rights to exercise the Option accrue periodically, to
the extent of a pro rata portion through the date of death of any
additional vesting rights that would have accrued on the next
vesting date had the Employee not died. The proration shall be based
upon the number of days accrued in the current vesting period prior
to the Employee's date of death.
5. METHOD OF EXERCISING OPTION.
Subject to the terms and conditions of this Agreement, the Option may be
exercised by written notice to the Company or its designee, in substantially the
form of EXHIBIT A attached hereto. Such notice shall state the number of Shares
with respect to which the Option is being exercised and shall be signed by the
person exercising the Option. Payment of the purchase price for such Shares
shall be made in accordance with Section 9 of the Plan. The Company shall
deliver such Shares as soon as practicable after the notice shall be received,
provided, however, that the Company may delay issuance of such Shares until
completion of any action or obtaining of any consent, which the Company deems
necessary under any applicable law (including, without limitation, state
securities or "blue sky" laws). The Shares as to which the Option shall have
been so exercised shall be registered in the Company's share register in the
name of the person so exercising the Option (or, if the Option shall be
exercised by the Employee and if the Employee shall so request in the notice
exercising the Option, shall be registered in the Company's share register in
the name of the Employee and another person 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 shall be exercised,
pursuant to Section 4 hereof, by any person other than the Employee, such notice
shall be accompanied by appropriate proof of the right of such person to
exercise the Option. All Shares that shall be purchased upon the exercise of the
Option as provided herein shall be fully paid and nonassessable.
2
6. PARTIAL EXERCISE.
Exercise of this Option to the extent above stated may be made in part at
any time and from time to time within the above limits, except that no
fractional share shall be issued pursuant to this Option.
7. NON-ASSIGNABILITY.
The Option shall not be transferable by the Employee otherwise than by will
or by the laws of descent and distribution. The Option shall be exercisable,
during the Employee's lifetime, only by the Employee (or, in the event of legal
incapacity or incompetency, by the Employee's guardian or representative) and
shall not be assigned, pledged or hypothecated in any way (whether by operation
of law or otherwise) and shall not be subject to execution, attachment or
similar process. Any attempted transfer, assignment, pledge, hypothecation or
other disposition of the Option or of any rights granted hereunder contrary to
the provisions of this Section 7, or the levy of any attachment or similar
process upon the Option shall be null and void.
8. NO RIGHTS AS STOCKHOLDER UNTIL EXERCISE.
The Employee shall have no rights as a stockholder with respect to Shares
subject to this Agreement until registration of the Shares in the Company's
share register in the name of the Employee. Except as is expressly provided in
the Plan with respect to certain changes in the capitalization of the Company,
no adjustment shall be made for dividends or similar rights for which the record
date is prior to the date of such registration.
9. ADJUSTMENTS.
The Plan contains provisions covering the treatment of Options in a number
of contingencies such as stock splits and mergers. Provisions in the Plan for
adjustment with respect to stock subject to Options and the related provisions
with respect to successors to the business of the Company are hereby made
applicable hereunder and are incorporated herein by reference.
10. TAXES.
The Employee acknowledges that any income or other taxes due from him or
her with respect to this Option or the Shares issuable pursuant to this Option
shall be the Employee's responsibility.
In the event of a Disqualifying Disposition (as defined in Section 15
below) or if the Option is converted into a Non-Qualified Option and such
Non-Qualified Option is exercised, the Company may withhold from the Employee's
remuneration, if any, the minimum statutory amount of federal, state and local
withholding taxes attributable to such amount that is considered compensation
includable in such person's gross income. At the Company's discretion, the
amount required to be withheld may be withheld in cash from such remuneration,
or in kind from the Shares otherwise deliverable to the Employee on exercise of
the Option. The Employee further agrees that, if the Company does not withhold
an amount from the Employee's remuneration sufficient to satisfy the Company's
income tax withholding obligation, the Employee will reimburse the Company on
demand, in cash, for the amount under-withheld.
11. PURCHASE FOR INVESTMENT.
Unless the offering and sale of the Shares to be issued upon the particular
exercise of the Option shall have been effectively registered under the
Securities Act of 1933, as now in force or hereafter
3
amended (the "1933 Act"), the Company shall be under no obligation to issue the
Shares covered by such exercise unless and until the following conditions have
been fulfilled:
(a) The person(s) who exercise the Option shall warrant to the Company,
at the time of such exercise, that such person(s) are acquiring such
Shares for their own respective accounts, for investment, and not
with a view to, or for sale in connection with, the distribution of
any such Shares, in which event the person(s) acquiring such Shares
shall be bound by the provisions of the following legend which shall
be endorsed upon the certificate(s) evidencing the Shares issued
pursuant to such exercise:
"The shares represented by this certificate have been taken for
investment and they may not be sold or otherwise transferred by
any person, including a pledgee, unless (1) either (a) a
Registration Statement with respect to such shares shall be
effective under the Securities Act of 1933, as amended, or (b)
the Company shall have received an opinion of counsel
satisfactory to it that an exemption from registration under
such Act is then available, and (2) there shall have been
compliance with all applicable state securities laws;" and
(b) If the Company so requires, the Company shall have received an
opinion of its counsel that the Shares may be issued upon such
particular exercise in compliance with the 1933 Act without
registration thereunder. Without limiting the generality of the
foregoing, the Company may delay issuance of the Shares until
completion of any action or obtaining of any consent, which the
Company deems necessary under any applicable law (including without
limitation state securities or "blue sky" laws).
12. RESTRICTIONS ON TRANSFER OF SHARES.
12.1 If, in connection with a registration statement filed by the Company
pursuant to the Securities Act, the Company or its underwriter so
requests, the Employee will agree not to sell any Shares for a
period not to exceed 180 days following the effectiveness of such
registration.
12.2 The Employee acknowledges and agrees that neither the Company, its
shareholders nor its directors and officers, has any duty or
obligation to disclose to the Employee any material information
regarding the business of the Company or affecting the value of the
Shares before, at the time of, or following a termination of the
employment of the Employee by the Company, including, without
limitation, any information concerning plans for the Company to make
a public offering of its securities or to be acquired by or merged
with or into another firm or entity.
13. NO OBLIGATION TO EMPLOY.
The Company is not by the Plan or this Option obligated to continue the
Employee as an employee of the Company or an Affiliate. The Employee
acknowledges: (i) that the Plan is discretionary in nature and may be suspended
or terminated by the Company at any time; (ii) that the grant of the Option is a
one-time benefit which does not create any contractual or other right to receive
future grants of options, or benefits in lieu of options; (iii) that all
determinations with respect to any such future grants, including, but not
limited to, the times when options shall be granted, the number of shares
subject to each option, the option price, and the time or times when each option
shall be exercisable, will be at the sole discretion of the Company; (iv) that
the Employee's participation in the Plan is voluntary; (v) that the value of the
Option is an extraordinary item of compensation which is outside the scope of
the Employee's employment contract, if any; and (vi) that the Option is not part
of normal or expected
4
compensation for purposes of calculating any severance, resignation, redundancy,
end of service payments, bonuses, long-service awards, pension or retirement
benefits or similar payments.
14. OPTION IS INTENDED TO BE AN ISO.
The parties each intend that the Option be an ISO so that the Employee (or
the Employee's Survivors) may qualify for the favorable tax treatment provided
to holders of Options that meet the standards of Section 422 of the Code. Any
provision of this Agreement or the Plan which conflicts with the Code so that
this Option would not be deemed an ISO is null and void and any ambiguities
shall be resolved so that the Option qualifies as an ISO. Nonetheless, if the
Option is determined not to be an ISO, the Employee understands that neither the
Company nor any Affiliate is responsible to compensate him or her or otherwise
make up for the treatment of the Option as a Non-qualified Option and not as an
ISO. The Employee should consult with the Employee's own tax advisors regarding
the tax effects of the Option and the requirements necessary to obtain favorable
tax treatment under Section 422 of the Code, including, but not limited to,
holding period requirements.
15. NOTICE TO COMPANY OF DISQUALIFYING DISPOSITION.
The Employee agrees to notify the Company in writing immediately after the
Employee makes a Disqualifying Disposition of any of the Shares acquired
pursuant to the exercise of the Option. A Disqualifying Disposition is defined
in Section 424(c) of the Code and includes any disposition (including any sale)
of such Shares before the later of (a) two years after the date the Employee was
granted the Option or (b) one year after the date the Employee acquired Shares
by exercising the Option, except as otherwise provided in Section 424(c) of the
Code. If the Employee has died before the Shares are sold, these holding period
requirements do not apply and no Disqualifying Disposition can occur thereafter.
16. NOTICES.
Any notices required or permitted by the terms of this Agreement or the
Plan shall be given by recognized courier service, facsimile, registered or
certified mail, return receipt requested, addressed as follows:
If to the Company:
Synta Pharmaceuticals Corp.
00 Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Vice President Legal Affairs
If to the Employee:
_____________________________
_____________________________
_____________________________
or to such other address or addresses of which notice in the same manner has
previously been given. Any such notice shall be deemed to have been given upon
the earlier of receipt, one business day following delivery to a recognized
courier service or three business days following mailing by registered or
certified mail.
5
17. GOVERNING LAW.
This Agreement shall be construed and enforced in accordance with the law
of the State of Delaware, without giving effect to the conflict of law
principles thereof. For the purpose of litigating any dispute that arises under
this Agreement, the parties hereby consent to exclusive jurisdiction in the
Commonwealth of Massachusetts and agree that such litigation shall be conducted
in the courts of Middlesex County, Massachusetts or the federal courts of the
United States for the District of Massachusetts.
18. BENEFIT OF AGREEMENT.
Subject to the provisions of the Plan and the other provisions hereof, this
Agreement shall be for the benefit of and shall be binding upon the heirs,
executors, administrators, successors and assigns of the parties hereto.
19. ENTIRE AGREEMENT.
This Agreement, together with the Plan, embodies the entire agreement and
understanding between the parties hereto with respect to the subject matter
hereof and supersedes all prior oral or written agreements and understandings
relating to the subject matter hereof. No statement, representation, warranty,
covenant or agreement not expressly set forth in this Agreement shall affect or
be used to interpret, change or restrict, the express terms and provisions of
this Agreement, provided, however, in any event, this Agreement shall be subject
to and governed by the Plan.
20. MODIFICATIONS AND AMENDMENTS.
The terms and provisions of this Agreement may be modified or amended as
provided in the Plan.
21. WAIVERS AND CONSENTS.
Except as provided in the Plan, the terms and provisions of this Agreement
may be waived, or consent for the departure therefrom granted, only by written
document executed by the party entitled to the benefits of such terms or
provisions. No such waiver or consent shall be deemed to be or shall constitute
a waiver or consent with respect to any other terms or provisions of this
Agreement, whether or not similar. Each such waiver or consent shall be
effective only in the specific instance and for the purpose for which it was
given, and shall not constitute a continuing waiver or consent.
22. DATA PRIVACY.
By entering into this Agreement, the Employee: (i) authorizes the Company
and each Affiliate, and any agent of the Company or any Affiliate administering
the Plan or providing Plan recordkeeping services, to disclose to the Company or
any of its Affiliates such information and data as the Company or any such
Affiliate shall request in order to facilitate the grant of options and the
administration of the Plan; (ii) waives any data privacy rights he or she may
have with respect to such information; and (iii) authorizes the Company and each
Affiliate to store and transmit such information in electronic form.
6
EXHIBIT A
NOTICE OF EXERCISE OF INCENTIVE STOCK OPTION
TO: Synta Pharmaceuticals Corp.
Ladies and Gentlemen:
I hereby exercise my Incentive Stock Option to purchase _________ shares
(the "Shares") of the common stock, $.0001 par value, of Synta Pharmaceuticals
Corp. (the "Company"), at the exercise price of $________ per share, pursuant to
and subject to the terms of that certain Incentive Stock Option Agreement
between the undersigned and the Company dated _______________, 200_.
I understand the nature of the investment I am making and the financial
risks thereof. I am aware that it is my responsibility to have consulted with
competent tax and legal advisors about the relevant national, state and local
income tax and securities laws affecting the exercise of the Option and the
purchase and subsequent sale of the Shares.
I am paying the option exercise price for the Shares as follows:
________________________________________
Please issue the Shares (check one):
/ / to me; or
/ / to me and ____________________________, as joint tenants with right of
survivorship, at the following address: ________________________
________________________
________________________
My mailing address for shareholder communications, if different from the
address listed above, is: ________________________
________________________
________________________
Very truly yours,
------------------------------------------------
Employee (signature)
------------------------------------------------
Print Name
------------------------------------------------
Date
------------------------------------------------
Social Security Number
A-1
