EXHIBIT 10.63
FORM OF INCENTIVE STOCK OPTION AWARD AND SHAREHOLDERS AGREEMENT
UNDER THE
ZEFER CORP. 1999 INCENTIVE PLAN
This Incentive Stock Option Award and Shareholders Agreement (the "Award
Agreement") is made as of the ______ day of _____, ____ (the "Grant Date")
between ZEFER Corp. ("ZEFER" or the "Company") and (Last_Name) (First_Name)
("Participant"), residing at the address that appears on the signature page of
this Award Agreement.
W I T N E S S E T H:
The Company hereby grants to Participant an option (the "Option") to
purchase (Shares) shares ("Shares") of its common stock, par value $.001 per
share ("Common Stock"), at (Strike_Price) per Share (the "Option Price").
Participant may exercise this Option, subject to the vesting requirements set
forth in Section 2 of this Award Agreement, until the tenth anniversary of the
Grant Date (the "Final Exercise Date"). After the Final Exercise Date, this
Option shall be null and void. This Option is intended to qualify as an
"incentive stock option" under Section 422 of the Internal Revenue Code. This
Option is subject to the following terms and conditions:
1. Definitions. Unless otherwise defined in this Award Agreement,
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Capitalized terms in this Award Agreement shall have the meanings specified in
the ZEFER Corp. 1999 Incentive Plan (the "Plan") unless the context otherwise
requires.
2. Vesting and Exercisability. On each anniversary of the Grant Date,
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twenty-five percent (25%) of the Shares covered by the Option shall vest and
become exercisable by Participant; provided, however, that Participant may not
exercise any portion of this Option prior to the earlier of (i) June 30, 2005 or
(ii) the effective date of the Company's first registration statement under the
Securities Act of 1933 covering the offer and sale of Common Stock. Except as
otherwise provided in the Plan, Shares that have vested and become exercisable
under the Option may be exercised by Participant only during either (i) the
period in which Participant is an employee of the Company, or (ii) the three
month period immediately following the date of termination of Participant's
employment with the Company. Notwithstanding the foregoing, Participant may not
exercise this Option or any portion of the Option after the Final Exercise Date,
or in the event that Participant is terminated for "Cause" in accordance with
Section 9 of this Award Agreement.
3. Transfer Restrictions. This Option is not transferable except that, in
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the event of Participant's death, the vested portion of this Option that has
become exercisable may be exercised, prior to the Final Exercise Date, by the
executor or administrator of Participant's estate or Participant's distributee
during the one-year period commencing on the date of Participant's death.
4. Payment on Exercise of Option. Any vested portion of this Option that
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has become exercisable may be exercised at the office of the Company in Boston,
Massachusetts (or at such other location as determined by the Company) by giving
written notice to ZEFER (Attention: Stock Option Plan Administrator) of the
exercise of such vested portion of this Option. The Option Price for the
Shares that are the subject of the exercise may be paid by delivery of cash,
certified check, bank draft or money order. In addition, at any time that the
Common Stock is registered under Section 12 of the Securities Exchange Act of
1934, the Option Price may be paid by (i) delivering shares of Company stock
(which, if acquired directly from the Company, shall have been held for at least
six months, unless the Stock Option Plan Administrator approves a shorter
period) with a fair market value equal to the Option Price for the Shares that
Participant is exercising; (ii) delivery of an unconditional undertaking by a
broker to deliver the Option Price immediately following a sale of the Shares
that are the subject of the exercise; or (iii) any combination of the foregoing
permissible forms of payment. In the event that any portion of this Option is
exercised by the executor or administrator of Participant's estate,
Participant's personal representative or distributee, the Company shall be under
no obligation to deliver Shares hereunder unless and until the Company is
satisfied as to the authority of the person or persons exercising such portion
of this Option. The value of any share of Common Stock delivered in payment of
the Option Price shall be the closing price of the Common Stock on the principal
market in which it is traded on the day before the date of exercise (the "Market
Price").
5. Issuance of Shares. Upon the exercise of this Option for all or any
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part of the Shares, the Company shall issue and deliver to Participant a
certificate or certificates representing the number of Shares for which the
Option was exercised.
6. Plan. This Option is awarded pursuant to the Plan and is subject to
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all of the terms and conditions of the Plan, the terms of which are incorporated
by reference into this Award Agreement.
7. Withholding Taxes. The Company will have the right to (i) make
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deductions from any payment, including delivery of Shares, or require that
Shares or cash, or both, be withheld from any payment, in each case in an amount
sufficient to satisfy the minimum statutory withholding rates for federal and
state tax purposes arising as a result of the exercise of any portion or all of
this Option; or (ii) take such other action as may be necessary or appropriate
to satisfy any such minimum withholding obligations. The Committee (as that
term is defined in the Plan) may determine the manner in which such tax
withholding shall be satisfied, and may permit Shares (rounded up to the next
whole number) to be used to satisfy the minimum required tax withholding based
on the Market Price of such Shares on the exercise date.
8. Employment. Participation in the Plan shall not affect the Company's
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right to discharge Participant or constitute an agreement of employment between
Participant and the Company.
9. Certain Forfeitures upon Termination for Cause. Notwithstanding the
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provisions of Section 2 or any other provision of this Award Agreement, if
Participant's employment is terminated for Cause, Participant shall forfeit this
Option immediately, whether or not vested and whether or not exercisable, and
this Option shall be null and void. As used in this Award Agreement, "Cause"
shall be defined as (i) Participant's willful failure to perform, or gross
negligence in the performance of, his duties and responsibilities to the
Company; (ii) fraud, embezzlement or other material dishonesty with respect to
the Company; (iii) material breach by Participant of any provision of his or her
ZEFER Employment Agreement or this Award Agreement, where such breach is
materially harmful to the business, interests or reputation of the Company or
any of its affiliates; or (iv) conviction of, or plea of nolo contendere to, a
felony or other crime involving moral turpitude.
10. Stockholder Agreements and Holdback Agreements.
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10.1 Agreement to sign Stockholders Agreement. If, at the time that
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a portion or all of a portion of this Option is exercised, the Company is a
party to any agreement affecting all or substantially all of the outstanding
shares of Common Stock, such portion or all of this Option may be exercised only
if the Shares so acquired are made subject to the provisions of such agreement.
10.2 Holdback Agreement. In connection with any underwritten public
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offering, if requested by the Company and the managing underwriter, Participant
hereby agrees not to effect any public sale or distribution of any shares of
Common Stock, nor engage in any transaction that would be reasonably likely to
result in a public sale or distribution of securities of the same class as the
Stock for a specified period of time (not to exceed 180 days for the Company's
initial public offering and 90 days for all other offerings) following the
effective date of the registration statement for the offering (the "Holdback
Period"). Such agreement shall be in writing in a form satisfactory to the
Company and the managing underwriter. The Company may impose stop-transfer
instructions with respect to the Shares or other securities subject to the
foregoing restriction until the end of the Holdback Period.
11. Legend; Purchase for Investment. Participant covenants that any
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Shares acquired pursuant to the exercise of any portion of this Option shall be
acquired for investment and not with a view towards the distribution thereof,
that the Shares may not be transferred, except to the extent permitted hereunder
and in compliance with applicable federal and state securities laws, and that
unless the exercise of this Option is covered by an effective registration
statement under the Securities Act of 1933 the Shares will bear a restrictive
legend, the content of which shall be substantially as follows:
"THE SHARES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD,
TRANSFERRED OR OTHERWISE DISPOSED OF WITHOUT REGISTRATION UNDER OR OTHER
COMPLIANCE WITH THAT ACT AND THOSE LAWS AND THE RULES AND REGULATIONS
ADOPTED THEREUNDER."
12. Notices. All notices required or permitted to be given to Participant
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hereunder shall be deemed to have been duly given when sent by registered or
certified mail, return receipt requested, to Participant's address set forth
below or to such other address of which notice shall have been given to the
Company in accordance with this sentence.
13. Binding Effect; Successors and Assigns.
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(a) This Award Agreement shall be binding upon and inure to the
benefit of the parties and their successors, assigns, heirs, executors and legal
representatives.
(b) This Award Agreement may not be modified, amended or changed,
except by a written instrument executed by the parties.
14. Specific Performance. As the Shares cannot be readily purchased or
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sold in the open market, and the parties desire to impose certain restrictions
on transfer of the Shares, the parties agree that any damage available at law
for a breach of this Award Agreement would not be an adequate remedy, and
irreparable damage will result if this Award Agreement is not specifically
enforced. Therefore, the provisions hereof and the obligations of the parties
hereunder shall be enforceable in a court of equity, or other tribunal having
jurisdiction, by a decree of specific performance, and appropriate injunctive
relief may be applied for and granted in connection therewith. Such remedies
and all other
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remedies provided in this Award Agreement shall, however, be cumulative and not
exclusive and shall be in addition to any other remedies which any party may
have under this Award Agreement.
15. Severability. Any provision of this Award Agreement which is
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prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent permitted
by applicable law, the parties hereby waive any provision of law which renders
any provision hereof prohibited or unenforceable in any respect.
16. Law Governing. This Award Agreement shall be construed both as to
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validity and performance in accordance with, and governed by, the law of the
Commonwealth of Massachusetts (without regard to any rules of conflicts of laws
that would look to the laws of any other jurisdiction).
17. No Waiver. No course of dealing and no delay on the part of any party
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in exercising any right, power or remedy conferred by this Award Agreement shall
operate as a waiver thereof or otherwise prejudice such party's rights, powers
and remedies. No single or partial exercise of any rights, powers or remedies
conferred by this Award Agreement shall preclude any other or further exercise
thereof or the exercise of any other right, power or remedy.
18. No Oral Agreements or Understandings. Participant acknowledges that
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this Award Agreement, together with the Plan, his/her employment offer letter
and ZEFER Employment Agreement, constitutes the only agreement or understanding
that Participant has with the Company respecting such Participant's employment
with the Company and right to receive an award of equity ownership of the
Company.
19. Qualification Under Section 422. It is understood and intended that
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the Option granted hereunder qualifies as an "incentive stock option" as defined
in section 422 of the Code. If Participant intends to dispose or does dispose
(whether by sale, gift, transfer or otherwise) of any shares issued upon the
exercise of this option within one year of such exercise, he or she agrees to
notify the Company in writing within thirty (30) days after such disposition.
IN WITNESS WHEREOF, the parties hereto have caused this Award Agreement to
be executed as of the day and year first hereinabove written.
A duly authorized representative
Company:
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ZEFER CORP.
By:____________________________
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Participant:
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(First_Name) (Last_Name) Address:
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