EXHIBIT 99.2
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INCENTIVE STOCK OPTION AGREEMENT
UNDER THE PHOBOS CORPORATION 1999 STOCK OPTION PLAN
This Incentive Stock Option Agreement ("Agreement") dated and
effective as of _______ ("Grant Date"), being the date on which the Committee
has directed the Company to issue the option evidenced hereby, is entered into
between Phobos Corporation ("Company") and _______ ("Optionee"), pursuant to the
Phobos Corporation 1999 Stock Option Plan ("Plan") as adopted by the Company's
Board of Directors on November ___, 1999 and approved by the Company's
shareholders on January 18, 2000.
THE PARTIES HERETO INTENDING TO BE LEGALLY BOUND HEREBY AGREE AS
FOLLOWS:
1. Grant of Option
In consideration of the services performed or to be performed by the
Optionee and the promise of Optionee to abide by the terms of this Agreement,
the Company hereby grants to the Optionee an option (the "Option") under the
Plan to purchase a total of *** *** shares of the Company's common stock
("Common Stock"), upon the following terms and conditions:
(a) The Option is granted under and pursuant to the Plan, a
copy of which is on file with the Company's financial department and
incorporated herein by reference, and, except as modified or limited hereby, is
subject to all of the provisions thereof. The Optionee represents and warrants
that the Optionee has read the Plan and is fully familiar with all the terms and
conditions of the Plan and agrees to be bound thereby.
(b) The Option is intended to qualify as an incentive stock
option as defined in Section 422 of the Internal Revenue Code of 1986, as
amended, and the rules and regulations thereunder, and--except to the extent the
Option or any portion thereof now fails, or hereafter ceases, to so qualify--
will be treated as an incentive stock plan.
(c) The Exercise Price per share of the Common Stock
exercisable under the Option shall be $6.50. The exercise price shall be paid in
full with cash.
(d) The Option shall terminate on the tenth anniversary of the
Grant Date, unless earlier terminated as provided herein or in the Plan.
2. Exercise Rights
In addition to the terms and conditions for exercise of the Option as
set forth in the Plan, the Optionee's right to exercise the Option shall be
subject to the additional conditions and limitations set forth in the Option
Vesting Schedule attached as Exhibit A hereto, incorporated herein by reference.
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3. Income Taxes
Neither the Company nor the Committee nor any of their representatives
or agents has made any representation or warranties to the Optionee with respect
to the income tax or other consequences of the transactions contemplated by this
Agreement, and the Optionee is in no manner relying on the Company, the
Committee or any of their representatives or agents for an assessment of the tax
or other consequences.
4. Miscellaneous
(a) Contract. Nothing in this Agreement nor in the Plan nor in
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the granting of the Option shall confer on the Optionee any right to, or to a
guarantee of a continuation of, employment with the
Company or any of its affiliates or in any way limit the right of the Company or
any of its affiliates to terminate Optionee's employment with the Company.
(b) Investment. The Optionee hereby agrees and represents that
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the Option and any purchase of Common Stock under the Option are for Optionee's
own account for investment only.
(c) Stock Issuance. The exercise by the Optionee of the Option
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granted hereunder will not become final nor will Common Stock be issued pursuant
thereto unless the exercise fully complies with the requirements of the Plan,
this Agreement and all applicable federal, state and local laws.
(d) No Transfer. The Option may not be assigned, encumbered or
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transferred, except, in the event of death of the Optionee, by will or the laws
of descent and distribution.
(e) Binding Effect. This Agreement shall bind and inure to the
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benefit of the Company and its successors and assigns, and the Optionee and any
heir, legatee, or legal representative of the Optionee.
(f) Applicable Law. This Agreement shall be interpreted under
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and governed by and construed in accordance with the laws of the State of Utah
regardless of the law that might otherwise govern under applicable principles of
conflicts of laws.
(g) Counterparts. This Agreement may be executed in any number
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of counterparts, each of which shall be identical and all of which when taken
together shall constitute one and the same instrument, and any of the parties
hereto may execute this Agreement by signing any such counterpart.
IN WITNESS WHEREOF, the parties have executed this Incentive Stock
Option Agreement in duplicate as of the day and year first above written.
Phobos Corporation Optionee
By: By:
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Name: Xxx Xxxxx Name:
Title: President and Chief
Executive Officer
EXHIBIT A
TO
INCENTIVE STOCK OPTION AGREEMENT
Option Vesting Schedule
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In addition to the terms and conditions for exercise of the Option set
forth in the Plan and the Incentive Stock Option Agreement, Optionee's right to
exercise the Option shall be subject to the following additional conditions and
limitations.
1. Conditions.
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(A) Provided that the Optionee continues to be employed by the
Company at each annual anniversary vesting date, the Option shall vest over a
four (4) year period, at the rate of 25% per year, beginning on the first
anniversary of the Grant Date.
(B) The Option shall immediately terminate and shall no longer
be exercisable if the Company terminates the Optionee's employment with the
Company for cause or if the Optionee terminates the employment for any reason.
(C) The Option shall terminate and shall no longer be
exercisable after five business days if the Company terminates the Optionee's
employment with the Company for any reason other than for cause.
