Exhibit 10(i)
Form of Incentive Stock Option Agreement
AuGRID CORPORATION
INCENTIVE STOCK OPTION AGREEMENT
THIS AGREEMENT, made as of the 16th day of August, 2002 (the "Grant Date"),
by and between AuGRID CORPORATION (formerly AuGRID of Nevada, Inc.) (the
"Company"), and [name] (the "Optionee").
WHEREAS, the Company has adopted the AuGRID of Nevada, Inc. 2002 Long-Term
Incentive Plan (the "Plan") in order to provide an incentive to certain
employees, officers, consultants, advisors and directors of the Company and its
Subsidiaries, and thereby encourage them to devote their abilities and industry
to the success of the Company's business enterprise; and
WHEREAS, the Committee has determined to grant the Option to the Optionee
as provided herein:
NOW, THEREFORE, the parties hereto agree as follows:
1. Grant of Option.
1.1 The Company hereby grants to the Optionee the right and option (the
"Option") to purchase all or any part of an aggregate of [number] whole Shares
subject to, and in accordance with, the terms and conditions set forth in this
Agreement and the Plan.
1.2 The Option is intended to qualify as an "incentive stock option" within
the meaning of Section 422 of the Code; provided, however, that nothing in this
Agreement shall be interpreted as a representation, guarantee or other
undertaking on the part of the Company that the Option is or will be determined
to be an "incentive stock option" within the meaning of Section 422 of the Code.
1.3 This Agreement shall be construed in accordance and consistent with,
and subject to, the terms of the Plan (the provisions of which are incorporated
herein by reference) and, except as otherwise expressly set forth herein, the
capitalized terms used in this Agreement shall have the same definitions as set
forth in the Plan.
2. Exercise Price. The price at which the Optionee shall be entitled to purchase
Shares upon the exercise of the Option shall be $[amount] per Share.
3. Duration of Option. The Option shall be exercisable to the extent and in the
manner provided herein for a period of five (5) years from the Grant Date (the
"Exercise Term"); provided, however, that the Option may be earlier terminated
as provided in Section 6 hereof.
4. Exercisability of Option.
4.1 Subject to the provisions of this Agreement and the Plan, (a) on the
Grant Date, the Option shall become exercisable with respect to one-half of the
Shares subject to the Option, and (b) on the date six months after the Grant
Date, the Option shall become exercisable with respect to all of the Shares
subject to the Option, provided that the Optionee continues to be employed by
the Company or a Subsidiary through such vesting date. Any fractional number of
Shares resulting from the application of the foregoing provision shall be
rounded to the nearest whole number of Shares.
4.2 In the event of a Change in Control that occurs while the Optionee is
employed by the Company or a Subsidiary, the Option shall immediately vest in
full.
5. Manner of Exercise and Payment.
5.1 Subject to the terms and conditions of this Agreement and the Plan, the
Option may be exercised by written notice delivered in person or by mail to the
Secretary of the Company, at its principal executive office. Such notice shall
state that the Optionee is electing to exercise the Option and the number of
Shares in respect of which the Option is being exercised, and shall be signed by
the person or persons exercising the Option. If requested by the Committee, such
person or persons shall (a) deliver this Agreement to the Secretary of the
Company who shall endorse thereon a notation of such exercise, and (b) provide
satisfactory proof as to the right of such person or persons to exercise the
Option.
5.2 The notice of exercise described in Section 5.1 hereof shall be
accompanied by the full exercise price for the Shares in respect of which the
Option is being exercised. The exercise price for any Shares purchased pursuant
to the exercise of the Option shall be paid, as determined by the Committee in
its discretion, in either of the following forms (or any combination thereof):
(a) cash or (b) the transfer, either actually or by attestation, to the Company
of Shares upon such terms and conditions as determined by the Committee. In
addition, Options may be exercised through a registered broker-dealer pursuant
to such cashless exercise procedures which are, from time to time, deemed
acceptable by the Committee.
5.3 Upon receipt of notice of exercise and full payment for the Shares in
respect of which the Option is being exercised, the Company shall, subject to
the Plan, take such action as may be necessary to affect the transfer to the
Optionee of the number of Shares as to which such exercise was effective.
5.4 The Optionee shall not be deemed to be the holder of, or to have any of
the rights of a holder with respect to, any Shares subject to the Option until
(a) the Option shall have been exercised pursuant to the terms of this Agreement
and the Optionee shall have paid the full exercise price for the number of
Shares in respect of which the Option was exercised, (b) the Company shall have
issued and delivered the Shares to the Optionee, and (c) the Optionee's name
shall have been entered as a stockholder of record on the books of the Company,
whereupon the Optionee shall have full voting and other ownership rights with
respect to such Shares.
6. Termination of Option. Unless otherwise required by the Plan or as otherwise
determined by the Committee, each Option shall terminate on the date which is
the fifth anniversary of the Grant Date, unless terminated earlier as follows:
6.1 Unless otherwise determined by the Committee, if the employment of the
Optionee is terminated for any reason other than Disability, death or Cause, the
Optionee may for a period of three (3) months after such termination exercise
the Option to the extent, and only to the extent, that such Option or portion
thereof was vested and exercisable as of the date of such termination, after
which time the Option shall automatically terminate in full.
6.2 Unless otherwise determined by the Committee, if the employment of the
Optionee is terminated by reason of Disability, the Optionee may, for a period
of twelve (12) months after such termination, exercise the Option to the extent,
and only to the extent, that such Option or portion thereof was vested and
exercisable as of the date of such termination, after which time the Option
shall automatically terminate in full.
6.3 Unless otherwise determined by the Committee, if the employment of the
Optionee is terminated by reason of death, the Option may be exercised at any
time within twelve (12) months after the Optionee's death by the person or
persons to whom such rights under the Option shall pass by will, or by the laws
of descent or distribution, after which time the Option shall terminate in full;
provided, however, that the Option may be exercised to the extent, and only to
the extent, that the Option or portion thereof was exercisable on the date of
the Optionee's death.
7. Non-Transferability. The Option shall not be transferable other than by will
or by the laws of descent and distribution. The Option shall be exercisable only
by the Optionee or the Optionee's guardian or legal representative during the
lifetime of the Optionee. The transfer of an Option shall be null and void
unless the transferee agrees in writing prior to such transfer to be bound by
the terms of the Plan and this Agreement with respect to such Option, and upon a
valid transfer, for purposes of the Plan and this Agreement, such transferee
shall be deemed to be the Optionee.
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8. No Right to Continued Employment. Nothing in this Agreement or the Plan shall
be interpreted or construed to confer upon the Optionee any right with respect
to continuance of employment by the Company, nor shall this Agreement or the
Plan interfere in any way with the right of the Company to terminate the
Optionee's employment at any time.
9. Adjustments upon Change in Capitalization. If, by reason of a Change in
Capitalization, new, additional or different shares of stock or securities of
the Company or any successor corporation or entity, or other property, are
issuable in addition to, or in lieu of, the Shares, then the Committee may, if,
in its sole discretion, it deems appropriate, adjust the number or type of
securities covered by this Option and the purchase price thereof, in accordance
with the terms of the Plan.
10. Securities Law Considerations. The Option is subject to the requirement
that, if at any time the Committee determines, in its discretion, that the
listing, registration or qualification of the Shares is required by 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 grant of the Option or the issuance of
the Shares, then no Shares may be issued, in whole or in part, unless listing,
registration, qualification, consent or approval has been effected or obtained
free of any conditions, as acceptable to the Committee. In addition,
notwithstanding anything contained in the Plan or herein to the contrary, in the
event that the disposition of any Shares acquired pursuant to the Option is not
covered by a then current registration statement under the Securities Act of
1933, as amended (the "Securities Act"), and is not otherwise exempt from such
registration, then the Shares shall be restricted against transfer to the extent
required by the Securities Act and Rule 144 or other regulations thereunder. The
Committee may require the Optionee, as a condition precedent to receipt of the
Shares, to represent and warrant to the Company in writing that the Shares
acquired by the Optionee are acquired without a view to any distribution thereof
and will not be sold or transferred other than pursuant to an effective
registration hereof under the Securities Act or pursuant to an exemption
applicable under the Securities Act or the rules and regulations promulgated
thereunder. The certificates evidencing any such Shares shall contain an
appropriate legend to reflect their status as restricted securities as
aforesaid.
11. Required Notification by Optionee. If the Optionee shall dispose of any
Shares issued pursuant to the exercise of the Option under the circumstances
described in Section 421(b) of the Internal Revenue Code (whereby the Optionee
makes a disqualifying disposition of the shares within the two-year period
commencing on the day after the date of grant of the Option or within the
one-year period commencing on the day after the date of transfer of the Shares
to the Optionee pursuant to the exercise of the Option), then the Optionee shall
notify the Company of such disqualifying disposition within ten (10) days of the
disposition.
12. Optionee Bound by the Plan. The Optionee hereby acknowledges receipt of a
copy of the Plan and agrees to be bound by all the terms and provisions thereof.
If there is any inconsistency between the terms of the Plan and this Agreement,
the terms of the Plan shall prevail.
13. Modification of Agreement. Except as set forth in the Plan and herein, this
Agreement may be modified, amended, suspended or terminated, and any terms or
conditions may be waived, but only by a written instrument executed by the
parties hereto.
14. Severability. Should any provision of this Agreement be held by a court of
competent jurisdiction to be unenforceable or invalid for any reason, the
remaining provisions of this Agreement shall not be affected by such holding and
shall continue in full force and effect in accordance with their terms.
15. Governing Law. The validity, interpretation, construction and performance of
this Agreement shall be governed by the laws of the State of Nevada without
giving effect to the conflicts of laws principles thereof.
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16. Successors in Interest. This Agreement shall inure to the benefit of and be
binding upon any successor to the Company. This Agreement shall inure to the
benefit of the Optionee's legal representatives. All obligations imposed upon
the Optionee and all rights granted to the Company under this Agreement shall be
final, binding and conclusive upon the Optionee's heirs, executors,
administrators and successors.
17. Resolution of Disputes. Any dispute or disagreement which may arise under,
or as a result of, or in any way relate to, the interpretation, construction or
application of this Agreement shall be determined by the Committee. Any
determination made hereunder shall be final, binding and conclusive on the
Optionee and the Company for all purposes.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
AuGRID CORPORATION
By: __________________________
X.X. Xxxxxxx
President and Chief Executive Officer
Attest:
----------------------------
Xxxx X. Xxxxx-Xxxxxxxx
Secretary
Optionee:
----------------------------
[name]
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