Exhibit 99.2
ONTARGET, INC.
1999 STOCK AWARD PLAN
STOCK OPTION AGREEMENT
(Incentive Stock Option)
Employee/Optionee:
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Number of ISO Shares: Shares
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ISO Option Exercise Price: $ per Share
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Date of XXX Xxxxx:
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ISO Vesting Schedule: No. Shares Date
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THIS OPTION AGREEMENT (the "Agreement") is entered into as of the
day of , 1999, by and between ONTARGET, INC., a Georgia
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corporation (the "Company"), and the employee designated above (the
"Optionee").
W I T N E S S E T H:
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WHEREAS, the OnTarget, Inc. 1999 Stock Award Plan (the "Plan") was
adopted by the Company, a copy of which is attached hereto as Exhibit A and
incorporated herein by reference; and
WHEREAS, the Board of Directors of the Company or the Committee
responsible for the administration of the Plan has determined to grant the
Option to the Optionee as provided herein;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Grant of Option.
1.1 Option. An option to purchase shares of the Company's Common Stock,
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par value $.01 per share (the "Shares"), is hereby granted to the Optionee
(the "Option").
1.2 Number of Shares. The number of Shares that the Optionee can
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purchase upon exercise of the Option is set forth above.
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1.3 Option Exercise Price. The price the Optionee must pay to exercise
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the Option (the "Option Exercise Price") is set forth above.
1.4 Date of Grant. The date that the Option is granted (the "Date of
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Grant") is set forth above.
1.5 Type of Option. The Option is intended to qualify as an Incentive
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Stock Option within the meaning of Section 422 of the Internal Revenue Code of
1986, as amended from time to time, or any successor provision thereto, and
shall be so construed; 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. To the extent this
Option is not treated as an Incentive Stock Option, it will be treated as a
Nonqualified Stock Option.
1.6 Construction. This Agreement shall be construed in accordance
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and consistent with, and subject to, the provisions 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.
1.7 Condition. The Option is conditioned on the Optionee's execution
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of this Agreement. If this Agreement is not executed by the Optionee, it may be
canceled by the Board of Directors.
2. Duration. The Option shall be exercisable to the extent and in the manner
provided herein for a period of ten (10) years from the Grant Date (the
"Exercise Term"); provided, however, that the Option may be earlier terminated
as provided in Section 1.7 and Section 5 hereof.
3. Vesting. The Option shall vest, and may be exercised, with respect to the
Shares subject thereto, on or after the dates set forth above, subject to
earlier termination of the Option as provided in Section 1.7 and Section 5
hereof or in the Plan and subject to the limitations on exercise contained in
Section 7 hereof.
4. Manner of Exercise and Payment.
4.1 To exercise the Option, the Optionee must deliver a completed copy
of the Option Exercise Form, attached hereto as Exhibit B and incorporated
herein by reference, to the address indicated on such Form or such other
address designated by the Company from time to time. The Option may be
exercised in whole or in part. Within thirty (30) days of delivery of the
Option Exercise Form, the Company shall deliver certificates evidencing the
Shares to the Optionee, duly endorsed for transfer to the Optionee, free and
clear of all liens, security interests, pledges or other claims or charges.
Contemporaneously with the delivery of the Option Exercise Form, Optionee
shall tender the Option Exercise Price to the Company, by cash, check, wire
transfer or other means acceptable to the Company pursuant to the Plan.
4.2 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 (i) the Option shall have been
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exercised pursuant to the terms of this Agreement and the Optionee shall have
paid the full purchase price for the number of Shares in respect of which the
Option was exercised, (ii) the Company shall have issued and delivered the
Shares to the Optionee, and (iii) the Optionee's name shall have been entered
as a shareholder of record on the books of the Company, whereupon the Optionee
shall have full voting and other ownership rights with respect to such Shares.
5. Termination of Employment.
5.1 Termination for Cause. If the Optionee's employment is terminated
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by the Company for Cause, all outstanding unvested Options granted to the
Optionee shall expire immediately, and the Optionee's right to exercise any
then outstanding Options (whether or not vested) shall terminate immediately
upon the date that the Committee determines is the Optionee's date of
termination of employment.
5.2 Termination of Employment for Other Reasons. Subject to Section
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3.2, if the Optionee's employment is terminated by the Company without Cause,
or the Optionee voluntarily terminates his employment (including upon
Retirement, death, or Disability), all outstanding unvested Options shall
expire as of the date of termination of employment, and any Options vested as
of the date of termination shall remain exercisable at any time prior to their
expiration date or for three (3) months (twelve (12) months if termination is
due to death or disability) after the date of termination of employment,
whichever period is shorter.
5.3 Employment by Subsidiary. For purposes of this Section and
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Section 9, employment with the Company includes employment with any Subsidiary
of the Company. A change of employment between the Company and any Subsidiary or
between Subsidiaries is not a termination of employment under this Agreement.
6. Nontransferability. The Option shall not be transferable other than by
will or by the laws of descent and distribution. During the lifetime of the
Optionee, the Option shall be exercisable only by the Optionee.
7. Restrictions on the Options; Restrictions on the Shares.
7.1 Securities Laws Restrictions. The Option may not be exercised at
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any time unless, in the opinion of counsel for the Company, the issuance and
sale of the Shares issued upon such exercise is exempt from registration under
the Securities Act of 1933, as amended, or any other applicable federal or
state securities law, rule or regulation, or the Shares have been duly
registered under such laws. The Company shall not be required to register the
Shares issuable upon the exercise of the Option under any such laws. Unless
the Shares have been registered under all applicable laws, the Optionee shall
represent, warrant and agree, as a condition to the exercise of the Option,
that the Shares are being purchased for investment only and without a view to
any sale or distribution of such Shares and that such Shares shall not be
transferred or disposed of in any manner without registration under such laws,
unless it is the opinion of counsel for the Company that such a disposition is
exempt from such registration. The Optionee acknowledges that an appropriate
legend giving notice of the foregoing restrictions shall appear conspicuously
on all certificates evidencing the Shares issued upon the exercise of the
Option in accordance with Section
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11-8-204 of the Georgia Uniform Commercial Code. The legend shall appear as
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follows, or in other words of like import as determined by the Company:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR ANY STATE SECURITIES LAWS AND MAY
NOT BE SOLD, TRANSFERRED, OR OTHERWISE DISPOSED OF UNLESS THEY HAVE
BEEN REGISTERED OR AN EXEMPTION FROM REGISTRATION IS AVAILABLE.
TRANSFER OF SHARES REPRESENTED HEREBY IS RESTRICTED BY THE TERMS OF AN
OPTION AGREEMENT AND BY A STOCK OPTION PLAN.
7.2 Limitation Upon Exercise. Notwithstanding any other provision
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herein, no Option shall be exercisable if the exercise of the Option would
cause the Company's S corporation election to terminate.
7.3 Shareholder's Agreement. The Optionee acknowledges and agrees that,
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unless an effective registration statement has been filed with the Securities
and Exchange Commission covering the Shares of the Company, Optionee must,
immediately prior to or simultaneously with the exercise of any Option, agree
in writing to be bound by the terms, conditions, and restrictions of the then
current Shareholders Agreement of the Company.
7.4 Repurchase of Shares After Termination. Until the effective date of
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a registration statement filed with the Securities Exchange Commission
covering the Shares of the Company, if Optionee ceases to be employed by the
Company, which termination may be with or without Cause or for any reason
whatsoever (including death, Disability, or Retirement), then the Company
shall have the right in its sole discretion to purchase all of the Shares
acquired by exercise of the Option no later than thirty (30) days after such
termination (or with respect to Shares acquired upon exercise of the Option
after termination, no later than thirty (30) days after the date of such
exercise). In the event of Optionee's death, this Section 7.4 shall be binding
upon the Optionee's beneficiary or the representative or executor of
Optionee's estate.
(a) Termination Repurchase Price. The price the Company shall pay for
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each Share in the event Optionee's employment is terminated (the
"Termination Repurchase Price") will be an amount of cash equal to the fair
market value of a Share determined by the Board of Directors in the same
manner and amount as if determining the Option Exercise Price under the
Plan, all determined as of the date of Optionee's termination of
employment, but not less than the exercise price paid.
(b) Form of Payment. The Termination Repurchase Price shall be
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payable by delivery of the Company's promissory note (the "Termination
Note") evidencing the Company's obligation to pay the Termination
Repurchase Price with interest accruing at a rate of six per cent (6%) per
annum. If the Optionee's employment with the Company is terminated by the
Optionee, then such payments shall be paid in thirty-six (36) equal
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monthly installments commencing thirty (30) days after closing. If the
Optionee's employment with the Company is terminated by the Company, then
such payments shall be paid in twelve (12) equal monthly payments
commencing thirty (30) days after closing. The Company shall have the
discretion to accelerate any or all payments.
(c) Closing. At a time no later than thirty (30) days after the
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Optionee's employment terminates as described above (or with respect to
Shares acquired upon exercise of the Option after termination of
employment, at a time no later than thirty (30) days after the Optionee's
exercise of the Option), the Optionee shall deliver a certificate or
certificates representing all of the Shares, duly endorsed for transfer to
the Company, free and clear of all liens, security interests, pledges or
other claims or charges. Contemporaneously with the delivery of the
certificates evidencing the Shares, the Company shall deliver the
Termination Note.
7.5 Right of First Refusal; Closing. Until the effective date of a
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registration statement filed with the Securities Exchange Commission covering
the Shares of the Company, the Optionee agrees that he shall not sell, assign
or transfer any of the Shares without first obtaining a bona fide written
offer (the "Outside Offer") from a non-affiliated third party to purchase such
Shares, and, before accepting such offer, delivering a written offer to the
Company (the "Inside Offer") to sell the Shares at the same price and on the
same terms as those contained in the Outside Offer. Within ten (10) days after
receipt of the Inside Offer, the Company shall determine the bona fide nature
of the Outside Offer and the Optionee shall be responsible for providing
additional information to the Company to show the bona fide nature of the
Outside Offer. The Company (or, at the Company's sole election, the assignee
or assignees selected by the Company) will have thirty (30) days after receipt
of the Inside Offer within which to notify the Optionee of its acceptance of
the Inside Offer with respect to all, but not less than all, of the Shares so
offered. If the Inside Offer is not accepted by the Company (or its assignee)
within thirty (30) days, then the Optionee shall be free to sell, transfer or
assign the Shares so offered to the third party at the price and on the terms
contained in the Outside Offer; provided, however, the Company may refuse to
recognize such transaction if it had determined that the Outside Offer was not
bona fide. If the Company (or its assignee) notifies the Optionee of its
acceptance of the Inside Offer, then the Company (or its assignee) shall set a
date for the closing of such transfer, which shall be within sixty (60) days
of such notice of acceptance. At such closing, the Optionee shall deliver a
certificate or certificates representing the Shares to be sold, free and clear
of all liens, security interests, pledges or other claims or charges, and the
Company (or its assignee) shall tender the purchase price as determined in
this Section to the Optionee, by cash, check, wire transfer or other means
acceptable to the Optionee.
8. Investment Intent. The Optionee understands and acknowledges that the
Shares have not been registered under the Securities Act of 1933 or any state
securities law, and are consequently subject to the distribution restrictions in
Section 7.1 above. The Optionee acknowledges that the Company makes no
representation that the Shares will ever be registered or that there shall ever
be a public market for the Shares. The Optionee warrants that if he or she
exercises the Option, the Optionee is acquiring the Shares for his or her own
account for the purpose of investment, and not with a view to or for sale in
connection with any distribution thereof.
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9. 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.
10. Adjustments. In the event of a change in capitalization, such as a stock
split, or a corporate transaction, such as any merger, consolidation,
reorganization, separation, including a spin-off, or other distribution of stock
or property of the Company, the Committee (or the board of directors or
committee of the successor or surviving corporation that is responsible for
administration of the Plan) shall make appropriate adjustments to the number and
class of Shares or other stock or securities subject to the Option and the
purchase price for such Shares or other stock or securities. The Committee's
adjustment shall be made in accordance with the provisions of Section 4.3 of the
Plan and shall be effective and final, binding and conclusive for all purposes
of the Plan and this Agreement.
11. Certain Events. Upon the effective date of (i) the liquidation or
dissolution of the Company or (ii) a merger, consolidation or other business
combination involving the Company (a "Transaction"), the Option shall continue
in effect in accordance with its terms and the Optionee shall be entitled to
receive in respect of all Shares subject to the Option, upon exercise of the
Option (once it is vested and exercisable according to its terms), the same
number and kind of stock, securities, cash, property or other consideration that
each holder of Shares was entitled to receive in the Transaction.
12. Withholding of Taxes.
12.1 The Company shall have the right to deduct from any distribution of
cash to the Optionee an amount equal to the federal, state and local income
taxes and other amounts as may be required by law to be withheld (the
"Withholding Taxes") with respect to the Option. If the Optionee is entitled
to receive Shares upon exercise of the Option, the Optionee shall pay the
Withholding Taxes (if any) to the Company in cash prior to the issuance of
such Shares. In satisfaction of the Withholding Taxes, the Optionee may make a
written election (the "Tax Election"), which may be accepted or rejected in
the discretion of the Committee, to have withheld a portion of the Shares
issuable to him or her upon exercise of the Option, having an aggregate Fair
Market Value equal to the withholding Taxes, provided that, if the Optionee
may be subject to liability under Section 16(b) of the Exchange Act, the
election must comply with the requirements applicable to Share transactions by
such Optionees.
12.2 If the Optionee makes a disposition, within the meaning of Section
424(c) of the Code and regulations promulgated thereunder, of any Share or
Shares issued to him pursuant to his exercise of the Option within the two-
year period commencing on the day after the Grant Date or within the one-year
period commencing on the day after the date of transfer of such Share or
Shares to the Optionee pursuant to such exercise, the Optionee shall, within
ten (10) days of such disposition, notify the Company thereof, by delivery of
written notice to the Company at its principal executive office, and
immediately deliver to the Company the amount of Withholding Taxes.
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13. Employee 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.
14. Adjustments for Pooling-of-Interests Accounting. If the Company enters
into a transaction which is intended to be accounted for using the pooling-of-
interests method of accounting, but it is determined by the Board that the
Option or any aspect thereof could reasonably be expected to preclude such
treatment, then the Board, without the consent of the Participant, may modify
(to the minimum extent required) or revoke (if necessary) the Option or any of
the provisions thereof to the extent that the Board determines that such
modification or revocation is necessary to enable the transaction to be subject
to pooling-of-interests accounting.
15. Modification of Agreement. Except as provided in Section 14, this
Agreement may not be modified, amended, suspended or terminated, and any terms
or conditions may not be waived, except by a written instrument executed by the
parties hereto.
16. 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 in accordance with their terms.
17. Governing Law. The validity, interpretation, construction and performance
of this Agreement shall be governed by the laws of the State of Georgia without
giving effect to the conflicts of laws principles thereof.
18. Successors in Interest. This Agreement shall inure to the benefit of and
be binding upon each successor corporation. 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.
19. 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.
20. Legal Construction. The legal construction and interpretation of this
Agreement (including, but not limited to, issues of gender, plural and singular,
governing law, and severability) shall be governed by the provisions of Article
18 of the Plan.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
ONTARGET, INC.
By:
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Name:
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Title:
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By signing below, Optionee hereby (i) acknowledges receipt of a copy of
the Plan which is attached hereto as Exhibit A, (ii) represents that he or she
is familiar with the terms and provisions hereof and thereof, and (iii)
accepts the Option subject to all the terms and provisions hereof and thereof.
Optionee hereby agrees to accept as binding, conclusive and final all
decisions or interpretations of the Board of Directors of the Company, or the
Compensation Committee or other Committee responsible for the administration
of the Plan, upon any questions arising under the Plan. Optionee authorizes
the Company to withhold, in accordance with applicable law, from any
compensation payable to him or her, any taxes required to be withheld by
federal, state or local law as a result of the grant, existence or exercise of
the Option.
OPTIONEE
Signature:
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Name:
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[EXHIBITS FOLLOW]
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EXHIBIT B
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OPTION EXERCISE FORM
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I, , do hereby exercise the Option with a Date
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of Grant of , granted to me by the Option Agreement
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executed in connection therewith. The number of Shares being purchased, the
Exercise Price, and the Total Option Exercise Price are set forth below:
Number of Shares: Shares
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Option Exercise Price Per Share x $____________ per Share
Total Option Exercise Price: = $________. ____
The Total Option Exercise Price is included with this Form.
Date:
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Signature
Send or deliver this Form with an original signature to:
OnTarget, Inc.
0000 Xxxxxxxxx Xxxx N.E.
Suite 700
Atlanta, GA 30326
Attn:
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