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EXHIBIT 10.2
INCENTIVE STOCK OPTION AGREEMENT PURSUANT TO THE 1999 EQUITY INCENTIVE PLAN
This INCENTIVE STOCK OPTION AGREEMENT (this "Agreement") is made as of
the__________________, by and between Unitrend Inc., (the "Corporation"), and
_____________________________________ ("Employee").
WITNESSETH:
The Corporation has determined that it is in the best interests of the
Corporation and its shareholders to encourage ownership in the Corporation by
qualified employees, officers, and members of the Board of Directors of the
Corporation or individuals as may be determined, thereby providing additional
incentive for them to continue in the employ of the Corporation or its
affiliates. To that end, an incentive stock option is granted by the Board to
Employee pursuant, and subject to, the 1999 Equity Incentive Plan (the "Plan")
on the following terms and conditions:
SECTION I
DEFINED TERMS
Unless otherwise defined herein or, unless the context requires a different
definition, capitalized terms used herein shall have the meanings assigned to
them in the Plan.
SECTION II
SHARES OPTIONED, OPTION PRICE, AND TIME OF EXERCISE
Effective as of_________________, the Corporation grants to Employee, subject to
the terms and provisions set forth hereinafter and in the Plan, the right and
option to purchase all or any part of the number of shares set forth in Exhibit
A of the presently authorized but unissued common stock ("Common Stock") of the
Corporation at the purchase price per share set forth as the Option Price in
Exhibit A (the option hereby granted being hereinafter referred to as the
"Option").
The Option shall not be considered granted (as of the effective date described
above) or become exercisable unless and until Employee delivers to the
Corporation a fully executed counterpart hereof. Thereafter, the Option shall be
exercisable in accordance with the Exercise Schedule set forth on Exhibit A,
subject to any termination, acceleration or change in such Exercise Schedule set
forth in this Agreement apart from Exhibit A.
The Option granted under this Agreement shall not be exercisable after the
Expiration of ten (10) years from the date such option is granted ("the
Expiration Date" set forth on Exhibit A and, before that time, the Option may be
terminated as hereinafter provided. If Employee does not purchase the full
number of shares to which he is entitled in any one year, he may purchase such
shares in the next year specified in the Exercise Schedule hereto, in addition
to the shares which he is otherwise entitled to purchase in the next year.
SECTION III
EXERCISE PROCEDURE
Employee shall exercise the Option by notifying the Corporation of the number of
shares that he desires to purchase and by delivering with such notice the full
payment for the purchase price of the shares being purchased. Such purchase
price shall be payable in cash, in Common Stock or in a combination of cash and
Common Stock. For purposes of determining the amount, if any, of the purchase
price satisfied by payment in Common Stock, such
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Common Stock shall be valued at its Fair Market Value on the date of exercise,
as determined by the Board at the time of exercise. In no event shall the
purchase price be less than one hundred percent (100%) of the Fair Market Value
of such stock at the time the Option is granted; except that the purchase price
shall be one hundred ten percent (110%) of the fair value in the case of any
person who owns stock possessing more than ten percent (10%) of the total
combined voting power of all classes of stock of the Corporation. Any Common
Stock delivered in satisfaction of all or a portion of the purchase price shall
be appropriately endorsed for transfer and assignment to the Corporation.
SECTION IV
TERMINATION OF EMPLOYMENT
If an Optionee's employment (or other service) with the Company terminates
either (i) for Cause or (ii) voluntary on the part of the Optionee and without
Good Reason (as determined by the Board, in its sole discretion), the options,
to the extent not previously exercised, will terminate on the date of such
termination of employment (or service). If an Optionee's employment or other
service with the Company terminates for reasons other than (a) termination that
is either (i) for Cause, (ii) voluntary on the part of the Optionee and without
Good Reason, (b) termination by reason of disability and (c) death, options
under the Plan may be exercised not later than three (3) months after such
termination, but may be exercised only to the extent the options were
exercisable on the date of termination, and in no event after ten (10) years
from the date of granting thereof. Except as may be otherwise provided in this
Agreement, the Option granted hereunder shall not be affected by any change of
employment so long as Employee continues to be employed by the Corporation, a
Parent Corporation or a Subsidiary.
"Cause" shall mean, as determined by the Board, in its absolute discretion, (i)
the continued failure of the Employee to substantially perform his duties to the
Corporation, a Parent Corporation or a Subsidiary (other than any such failure
resulting from disability as defined above), (ii) the engaging by the Employee
in willful, reckless or grossly negligent misconduct which is determined by the
Board to be materially injurious to the Corporation or any of its affiliates,
monetarily or otherwise, or (iii) the Employee's pleading guilty to or
conviction of a felony.
"Good Reason" shall mean, as determined by the Board, in its absolute
discretion, the occurrence of any of the following events without Employee's
express written consent:
(i) a substantial and adverse change in the Employee's duties, control,
authority or status or position, or the assignment to the Employee or
any duties or responsibilities which are inconsistent with such status
or position, or a reduction in the duties and responsibilities
previously exercised by the Employee, or a loss of title, loss of
office, loss of significant authority, power or control, or any removal
of him or her from or any failure to reappoint or reelect him to such
positions, except in connection with the termination of his employment
for Cause or disability (as defined above), or as a result of his
death;
(ii) a reduction in the Employee's base salary or a material reduction in
the Employee's total compensation (i.e., a reduction in such total
compensation of ten (10) percent or more); or
(iii) any material breach by the Corporation of any provisions of any
agreement with the Employee.
SECTION V
ACCELERATION OF EXERCISE
(a) Retirement and Total and Permanent Disability. If an Optionee should
become permanently and totally disabled while an employee, or officer
of the Company, options shall become fully exercisable as to all shares
subject to them and may be exercised at any time within one (1) year
following the date of disability, but in no event after the Expiration
Date set forth on Exhibit A. If an Optionee should retire with the
written consent of the Company, options shall become fully exercisable
as to all shares subject to them and may be exercised at any time
within three (3) months of such retirement, but in no event after the
Expiration Date set forth on Exhibit A. If such option is exercised
within three months prior to the
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Expiration Date set forth in Exhibit A, such Option shall not receive
favorable tax treatment under Code Section 421(a).
(b) Death. If an Optionee should die while an employee, options may be
exercised at any time within one (1) year following the date of death,
but in no event after the earlier of (i) the date one year following
the Employee's date of death, or (ii) the Expiration Date set forth on
Exhibit A hereto. Such Option may be exercised by the beneficiary
designated by the Employee on Exhibit B hereto, in accordance with
Section X hereto, or, if no beneficiary is designated on Exhibit B, by
the executor or administrator of the Employee's estate.
(c) Corporate Change. Upon the occurrence of a Corporate Change, the Option
(to the extent not previously terminated or forfeited) may, at the
discretion of the Board, become fully exercisable as to all shares
subject to it.
SECTION VI
NON-ASSIGNABILITY AND TERM OF OPTION
The Option shall not be transferable or assignable by the Employee, otherwise
than by will or the laws of descent and distribution and the Option shall be
exercisable, during the Employee's lifetime, only by him. No Option shall be
subject to execution, attachment or similar process.
In no event may the Option be exercisable to any extent by anyone after the
Expiration Date specified in Exhibit A. It is expressly agreed that, anything
contained herein to the contrary notwithstanding, this Agreement shall not
constitute, or be evidence of, any agreement or understanding, express or
implied, that the Corporation, a Parent Corporation or a Subsidiary will employ
Employee for any period of time or in any position or for any particular
compensation.
SECTION VII
RIGHTS OF EMPLOYEE IN STOCK
Neither Employee, nor his successor in interest, shall have any of the rights of
a shareholder of the Corporation with respect to the shares for which the Option
is exercised until such shares are issued by the Corporation.
SECTION VIII
NOTICES
Any notice to be given hereunder shall be in writing and shall be addressed to
the Corporation, in care of the Director of Administration, at 0000 Xxxx
Xxxxxxxx Xxxxxx, Xxxxxx, Xxxx 00000, and any notice to be given to Employee
shall be addressed to the address designated below the signature appearing
hereinafter, or at such other address as either party may hereafter designate in
writing to the other. Any such notice shall have been deemed duly given upon
three (3) days of sending such notice enclosed in a properly sealed envelope,
addressed as aforesaid, registered or certified and deposited (with the proper
postage and registration or certificate fee prepaid) in the United States mail.
SECTION IX
SUCCESSORS OR ASSIGNS OF THE CORPORATION
The Option shall be binding upon and shall inure to the benefit of any successor
of the Corporation.
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SECTION X
MISCELLANEOUS
(a) Designation of Beneficiary. The Employee shall have the right to
appoint any individual or legal entity in writing, on Exhibit B hereto,
as his beneficiary to receive any Option (to the extent not previously
exercised or forfeited) under this Agreement upon the Employee's death.
Such designation under this Agreement may be revoked by the Employee at
any time and a new beneficiary may be appointed by the Employee by
execution and submission to the Board of a revised Exhibit B to this
Agreement. In order to be effective, a designation of beneficiary must
be completed by the Employee on Exhibit B and received by the Board, or
its designee, prior to the date of the Employee's death. In the absence
of such designation, the Employee's beneficiary shall be the person
designated under the Employee's will or as defined by the applicable
state laws of the decedent's distribution.
(b) Incapacity of Employee or Beneficiary. If any person entitled to a
distribution under this Agreement is deemed by the Board to be
incapable of making an election hereunder or of personally receiving
and giving a valid receipt for such distribution hereunder, then,
unless and until an election or claim therefore shall have been made by
a duly appointed guardian or other legal representative of such person,
the Board may provide for such election or distribution or any part
thereof to be made to any other person or institution then contributing
toward or providing for the care and maintenance of such person. Any
such distribution shall be a distribution for the account of such
person and a complete discharge of any liability of the Board, the
Corporation and the Plan therefore.
(c) Cancellation of Verbal Options. This contact cancels and supercedes any
oral grant of options. The Employee agrees to waive rights to oral
options and consents that this written contact represents and
encompasses any verbal options that may have been granted to the
Optionee.
(d) Incorporation of the Plan. The terms and provisions of the Plan are
hereby incorporated in this Agreement. Unless otherwise specifically
stated herein, such terms and provisions shall control in the event of
any inconsistency between the Plan and this Agreement.
(e) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF OHIO AND ALL APPLICABLE FEDERAL LAWS. THE SECURITIES ISSUED
HEREUNDER SHALL BE GOVERNED BY AND IN ACCORDANCE WITH THE CORPORATE
SECURITY LAWS OF THE STATE OF OHIO.
(f) Gender. Reference to the masculine herein shall be deemed to include
the feminine, wherever appropriate.
(g) Counterparts. This Agreement may be executed in one or more
counterparts, which shall together constitute a valid and binding
agreement.
IN WITNESS WHEREOF, this Agreement has been executed by the Corporation and the
Employee as of the date and year first written above.
Employee__________________________ Unitrend Inc., a Nevada Corporation
Address:__________________________ By:________________________________
__________________________________ Title:_____________________________
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EXHIBIT A
INCENTIVE STOCK OPTION AGREEMENT PURSUANT TO THE 1999 EQUITY INCENTIVE PLAN
1. Date of Grant: _________________________________________
2. Employee: __________________________________________
3. Number of Shares: ____________________shares of Common Stock
4. Option Price per Share: $0.50 a share
5. Exercise Schedule: 33% of the Options subject to this Agreement
shall first be exercisable one (1) year
after the Date of Grant specified above.
33% of the Options subject to this Agreement
shall thereafter be exercisable on each
anniversary date of the Date of Grant
specified above until the Options are fully
exercisable.
6. Expiration Date: Date of grant, _____________(not more than
ten (10) years from Date of Grant; (5) years
from Date of Grant for 10 percent or more
shareholders).
TO QUALIFY FOR INCENTIVE STOCK OPTION TAX TREATMENT, THE EMPLOYEE MUST NOT
DISPOSE OF SHARES OBTAINED ON EXERCISE OF AN OPTION UNTIL AT LEAST TWO YEARS
AFTER THE DATE OF GRANT AND ONE YEAR AFTER THE DATE OF EXERCISE OF THE OPTION.
IF THESE HOLDING PERIODS ARE NOT MET, THE SALE OR OTHER DISPOSITION OF SHARES
WILL BE A DISQUALIFYING DISPOSITION PURSUANT TO CODE.
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EXHIBIT B
DESIGNATION OF BENEFICIARY FOR THE INCENTIVE STOCK OPTION AGREEMENT PURSUANT TO
THE 1999 EQUITY INCENTIVE PLAN
Name of Employee: ________________________________________
Original Date of Agreement: _______________________________
If I shall cease to be an Employee of the Corporation, a Parent Corporation or a
Subsidiary by reason of my death, or if I shall die after I have terminated my
employment with the Corporation, the Parent Corporation or a Subsidiary, but,
prior to the expiration of the Option (as provided in the Agreement), then all
rights to the Option granted under this Agreement that I hereby hold upon my
death, to the extent not previously terminated or forfeited, shall be
transferred in the manner provided for in the Plan and the Agreement to the
following beneficiary(ies):
_________________________________________
_________________________________________
_________________________________________
_________________________________________
(if any line is left blank, write "None")
_________________________________________
_________________________________________
Date
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