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EXHIBIT 10.15
TELECOMMUNICATION SYSTEMS, INC.
1997 STOCK OPTION PLAN
OPTIONEE AGREEMENT
Incentive Stock Option No. 1 .
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No. of shares subject to Option: 241,935 .
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This AGREEMENT dated this 1st day of October, 1997 (the "Option
Date"), between TeleCommunication Systems, Inc., a Maryland corporation, (the
"Company") and Xxxx X. Xxxxx (the "Optionee").
W I T N E S S E T H:
1. Grant of Option. Pursuant to the provisions of the Company's
1997 Stock Option Plan (the "Plan"), the Company hereby grants to the Optionee,
subject to the terms and conditions of the Plan and subject further to the
terms and conditions herein set forth, the right and option to purchase from
the Company all or any part of an aggregate of 241,935 shares of non-voting
Common Stock at the purchase price of 07/100 Dollars ($.07) per share (the
"Option").
2. Exercise of Option. (a) The right and option granted
pursuant to this Agreement may be exercised (subject to the conditions herein)
as follows:
(i) On and after October 1, 1998, the Optionee shall be
entitled to purchase up to 100 percent of the shares of non-voting Common
Stock subject to this Agreement, which right shall end on the Termination Date
occurrence;
(ii) On and after October 1, 1999, the Optionee shall be
entitled to purchase up to an additional N/A percent of the shares of
non-voting Common Stock subject to this Agreement, which right shall end on the
Termination Date occurrence;
(iii) On and after October 1, 2000, the Optionee shall be
entitled to purchase up to an additional N/A percent of the shares of
non-voting Common Stock subject to this Agreement, which right shall end on the
Termination Date occurrence;
(iv) On and after October 1, 2001, the Optionee shall be
entitled to purchase up to an additional N/A percent of the shares of
non-voting Common Stock subject to this Agreement, which right shall end on the
Termination Date occurrence;
(v) On or after October 1, 2002, the Optionee shall be
entitled to purchase up to an additional N/A percent of the shares of
non-voting Common Stock subject to this Agreement, which right shall end on the
Termination Date occurrence; and
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(vi) The Optionee's right to exercise all or any portion of
the Option not previously exercised hereunder shall terminate on November 30,
2007 (the "Termination Date"), occurrence.
(b) No option may be exercised unless the Optionee is at the
time of such exercise an employee of the Company or an Affiliate, or any person
who provides services to the Company or an Affiliate; provided, however, that
if the Optionee's employment is terminated by the Company or an Affiliate
without "cause", the Optionee shall have a period of ninety (90) days from the
date of such termination to exercise this Option. For purposes of this
Agreement, the term "cause" shall mean, as determined by the Board in its sole
discretion, (A) the willful commission by the Optionee of a criminal or other
act that causes or is likely to cause substantial economic damage to the
Company or an Affiliate or substantial injury to the business reputation of the
Company or an Affiliate; (B) the commission by the Optionee of an act of fraud
in the performance of such Optionee's duties on behalf of the Company or an
Affiliate; or (C) the continuing willful failure of the Optionee to perform the
duties of such Optionee to the Company or an Affiliate (other than such failure
resulting from the Optionee's incapacity due to physical or mental illness)
after written notice thereof (specifying the particulars thereof in reasonable
detail) and a reasonable opportunity to be heard and cure such failure are
given to the Optionee by the Board. For purposes of this Agreement, no act, or
failure to act, on the Optionee's part shall be considered "willful" unless
done or omitted to be done by the Optionee not in good faith without reasonable
belief that the Optionee's action or omission was in the best interest of the
Company or an Affiliate. Absence or leave approved by the Administrator shall
not be considered an interruption of continuous employment for any purpose
under the Plan. Subject to the foregoing, the purchase rights represented by
this Option are exercisable at the option of the Optionee, from time to time,
prior to the Termination Date occurring; provided, however, that such purchase
rights shall not be exercisable until the Company has converted for tax
purposes from an "S" corporation to a "C" corporation, and that such rights
shall not be exercisable with respect to a fraction of a share of non-voting
Common Stock.
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(c) This Option may be exercised in whole or in part as
provided herein by presentation and surrender an executed Exercise Notice (in
the form attached hereto as Exhibit 1) evidencing the Optionee's election to
purchase shares pursuant to the Option, and the number of such shares, and
accompanied by the purchase price for the number of shares for which the Option
is being exercised.
(d) To the extent that this Option is not exercised prior to
the Termination Date, it shall automatically expire immediately prior to the
Termination Date and the rights of the Optionee hereof shall become null and
void and of no effect.
3. Definitions. Capitalized terms contained in this Agreement
that are not otherwise defined in the Agreement have the same meaning as they
are given in the Plan.
4. Terms and Conditions. It is understood and agreed that the
Option evidenced hereby is subject to the terms and conditions set forth in the
Plan, including without limitation the exercisability and forfeiture of the
Option and restrictions on transfer.
5. Rights as a Stockholder. The Optionee shall have no rights as
a stockholder with respect to any shares of non-voting Common Stock issuable or
transferable upon exercise thereof until the issuance of the stock certificates
evidencing such shares of Common Stock.
6. No Right to Continued Employment. This Agreement shall not be
construed as giving the Optionee any right to be retained in the employ or
service of the Company or an Affiliate or to affect or limit in any way the
right of the Company to terminate the employment or service of the Optionee at
any time with or without assigning a reason therefor.
7. Compliance with Law and Regulations. This Option and the
obligation of the Company to sell and deliver shares hereunder shall be subject
to all applicable federal and state laws, rules and regulations and to such
approvals by any government or regulatory agency as the administrator may deem
it necessary or advisable.
8. Optionee Bound by Plan. The Optionee hereby acknowledges
receipt of a copy of the Plan and agrees to be bound by all the terms and
provisions thereof.
9. Notice. Any notice hereunder to the Company shall be
addressed to it at its offices, TeleCommunication Systems, Inc., 000 Xxxx
Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000, Attention: Chief Financial Officer, and any
notice hereunder to the Optionee shall be addressed to him or her at 0000
Xxxxxx Xxxxx Xxxx, Xxxxxxxxxxxxx, XX 00000, subject to the right of either
party to designate at any time hereafter in writing some other address.
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IN WITNESS WHEREOF, TeleCommunication Systems, Inc. has caused this
Agreement to be executed by its officer and the Optionee has executed this
Agreement, as of the day and year first above written.
TELECOMMUNICATION SYSTEMS, INC.
By: /s/ Xxxxxx X. Xxxxxx, Xx.
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Name: Xxxxxx X. Xxxxxx, Xx.
Title: Sr. Vice President & Chief Financial Officer
/s/ Xxxx X. Xxxxx
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Xxxx X. Xxxxx, Optionee
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EXHIBIT 1
TeleCommunication Systems, Inc.
000 Xxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Re: Exercise of Stock Option
Gentlemen:
I hereby exercise the Option granted to me under the Stock Option Agreement
dated October 1, 1997, to purchase 241,935 shares of TeleCommunication Systems,
Inc. Class B non-voting common stock, $0.01 par value per share (the "Common
Stock"), with respect to _______ shares of non-voting Common Stock for an
aggregate purchase price of $_________. As consideration for such shares, I
have enclosed payment in the amount of $__________.
Please issue in my name and send the certificates representing the
shares purchased by my exercise of this Option to me at the address indicated
below.
Date:
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Optionee, Xxxx X. Xxxxx
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Address
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