MONARCH PROPERTIES, INC.
1998 OMNIBUS SECURITIES AND INCENTIVE PLAN
STOCK OPTION AWARD AGREEMENT
INCENTIVE STOCK OPTION
THIS AGREEMENT made as of _______________, 199_, by and between MONARCH
PROPERTIES, INC., a Maryland corporation (the "Company"), and
___________________ (the "Optionee").
WITNESSETH:
WHEREAS, the Company has adopted the Monarch Properties, Inc. 1998 Omnibus
Securities and Incentive Plan (the "Plan") for the benefit of its officers, key
employees and directors and the officers, key employees and directors of its
Affiliates, and
WHEREAS, the Committee has authorized the grant to the Optionee of an
Option under the Plan, on the terms and conditions set forth in the Plan and as
hereinafter provided,
NOW, THEREFORE, in consideration of the premises contained herein, the
Company and the Optionee hereby agree as follows:
1. Definitions
Terms used in this Agreement which are defined in the Plan shall have
the same meaning as set forth in the Plan.
2. Grant of Option
The Committee hereby grants to the Optionee an Option to purchase
[INSERT # OF SHARES] shares of the Company's Common Stock ("Shares"),
[exercisable in quantities of ________ (__) or more Shares,] for a price per
Share equal to [INSERT PRICE](not less than the Fair Market Value of a Share on
the date of this Agreement and not less than one hundred ten percent (110%) of
the Fair Market Value of a Share on the date of this Agreement if the Optionee
is a Ten Percent Shareholder. The Option granted under this Agreement is
intended by the Committee to be an Incentive Stock Option and the provisions of
this Agreement shall be interpreted on a basis consistent with such intent.
3. Option Terms and Exercise Period
a. The Option granted to the Optionee pursuant to this Agreement shall
be exercised, and payment by the Optionee of the Option Price shall be made,
pursuant to the terms of the Plan.
b. All or any part of the Option awarded under this Agreement may be
exercised by the Optionee no later than ten (10) years (five (5) years if the
Optionee is a Ten Percent Shareholder) after the date of this Agreement.
c. This Agreement and the Option issued hereunder to the Optionee
shall terminate on the earlier of (i) the [_______ (___)] anniversary (no later
than the tenth anniversary) of the date of this Agreement, or (ii) the date on
which the Option is fully exercised.
4. Vesting
The Option to purchase the number of Shares set forth in Section 2
shall become exercisable pursuant to the following schedule:
Anniversary of Date
of this Agreement Percent
%
%
%
Notwithstanding the above schedule, the Option shall be one hundred percent
(100%) exercisable in the Option granted under this Agreement if the Optionee's
employment with the Company shall terminate on account of the Optionee's death,
Permanent and Total Disability or retirement upon or after attaining age
sixty-two (62). The Optionee shall forfeit any unexercisable Options upon
termination of employment with the Company for any reason other than the
Optionee's death, Permanent and Total Disability or retirement upon or after
attaining age sixty-two (62).
5. Termination of Employment
Section 6.2(b) of the Plan shall control.
6. Restrictions on Transfer of Option
This Agreement and the Option granted hereunder shall not be
transferable otherwise than by will or by the laws of descent and distribution,
and shall be exercisable, during the Optionee's
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lifetime, solely by the Optionee, except on account of the Optionee's Permanent
and Total Disability or death.
7. Exercise of Option
a. The Option granted hereunder shall become exercisable at such time
as shall be provided herein and shall be exercisable by written notice of such
exercise, in the form prescribed by the Committee, to the Secretary of the
Company, at the Company's principal office. The notice shall specify the number
of Shares with respect to which the Option granted hereunder is being exercised.
b. Shares purchased pursuant to this Agreement shall be paid for in
full at the time of such purchase in cash, in Shares, including Shares acquired
pursuant to the Plan, or part in cash and part in Shares. Shares transferred in
payment of the Option Price shall be valued as of the date of transfer based on
their Fair Market Value.
8. Regulation by the Committee
This Agreement and the Option granted hereunder shall be subject to
the administrative procedures and rules as the Committee shall adopt. All
decisions of the Committee upon any question arising under the Plan or under
this Agreement, shall be conclusive and binding upon the Optionee and any person
or persons to whom the Option or any part of the Option granted hereunder has
been transferred by will or by the laws of descent and distribution.
9. Rights as a Shareholder
The Optionee shall have no rights as a shareholder with respect to Shares
subject to Options granted hereunder until certificates for Shares of Common
Stock are issued to the Optionee.
10. Change of Control
Notwithstanding the vesting requirements contained in Section 4, upon a
Change of Control, the Option granted hereunder shall automatically become fully
vested and exercisable as of the date of such Change of Control.
11. Reservation of Shares
With respect to the Option granted to the Optionee hereunder, the Company
hereby agrees to at all times reserve for issuance and/or delivery upon payment
by the Optionee of the Option Price, such number of Shares as shall be required
for issuance and/or delivery upon such payment pursuant to such Option.
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12. Delivery of Share Certificates
Within a reasonable time after the exercise of the Option granted hereunder
the Company shall cause to be delivered to the Optionee, his or her legal
representative or his or her beneficiary, a certificate for the Shares purchased
pursuant to the exercise of the Option.
13. Withholding
In the event the Optionee elects to exercise the Option granted hereunder
(or any part thereof), if the Company or an Affiliate shall be required to
withhold any amounts by reason of any federal, state or local tax rules or
regulations in respect of the issuance of Shares to the Optionee, the Company or
Affiliate shall be entitled to deduct and withhold such amounts from any payment
to be made to the Optionee hereunder.
14. Amendment
The Committee may amend this Agreement at any time and from time to time;
provided, however, that no amendment of this Agreement that would impair the
Optionee's rights or entitlements with respect to the Option granted hereunder
shall be effective without the consent of the Optionee (unless such amendment is
required in order to cause the Option granted hereunder to qualify as
performance-based compensation within the meaning of Section 162(m) of the Code
and applicable interpretive authority thereunder).
15. Plan Terms
The terms of the Plan are incorporated herein by reference.
16. Effective Date of Grant
The Option granted under this Agreement shall be effective as of the date
first written above.
17. Optionee Acknowledgment
By executing this Agreement, the Optionee hereby acknowledges that he or
she has received and read the Plan and this Agreement
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and that he or she agrees to be bound by all of the terms of both the Plan and
this Agreement.
ATTEST: MONARCH PROPERTIES, INC.
By:
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Its:
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WITNESS:
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, Optionee
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