EXHIBIT 10.5
Direct Access Interactive, Inc.
1999 Stock Option and Incentive Plan
Form of Stock Option Agreement
DIRECT ACCESS INTERACTIVE, INC.
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT (this "Agreement") is entered into as of this 5th
day of August, 1999, by and between Direct Access Interactive, Inc., a Georgia
corporation (the "Company"), and Xxxxxxx X. Xxxxxxxx Xx. (the "Optionee").
WHEREAS, the Board of Directors and shareholders of the Company have adopted a
Stock Option and Incentive Plan known as the "Direct Access Interactive, Inc.
1999 Stock Option and Incentive Plan" (the "Plan"); and
WHEREAS, the Committee has granted the Optionee a stock option to purchase the
number of shares of the Company's common stock as set forth below, and in
consideration of the granting of that stock option the Optionee intends to
remain in the employ of the Company; and
WHEREAS, the Company and the Optionee desire to enter into a written agreement
with respect to such option in accordance with the Plan.
NOW, THEREFORE, as an employment incentive and to encourage stock ownership,
and also in consideration of the mutual covenants contained herein, the parties
hereto agree as follows.
1. Incorporation of Plan. This option is granted pursuant to the provisions
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of the Plan, and the terms and definitions of the Plan are incorporated into
this Agreement by reference and made a part of this Agreement. The Optionee
acknowledges receipt of a copy of the Plan.
2. Grant of Option. Subject to the terms, restrictions, limitations and
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conditions stated in this Agreement, the Company hereby evidences its grant to
the Optionee, not in lieu of salary or other compensation, of the right and
option (the "Option") to purchase all or any part of the number of shares of the
Company's Common Stock, no par value per share (the "Stock"), set forth on
Schedule A attached and incorporated into this Agreement by reference. The
Option shall be exercisable in the amounts and at the time(s) specified on
Schedule A. The Option shall expire and shall not be exercisable on the date
specified on Schedule A or on such earlier date as determined pursuant to
Section 8, 9, or 10 of this Agreement. Schedule A states whether the Option is
intended to be an Incentive Stock Option.
3. Purchase Price. The price per share to be paid by the Optionee for the
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shares subject to this Option (the "Exercise Price") shall be as specified on
Schedule A, which price shall be an amount not less than the Fair Market Value
of a share of Stock as of the Date of Grant (as defined in Section 11 below) if
the Option is an Incentive Stock Option.
4. Exercise Terms. The Optionee must exercise the Option for at least the
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lesser of 100 shares or the number of shares of Purchasable Stock as to which
the Option remains unexercised. If this Option is not exercised with respect to
all or any part of the shares subject to this Option prior to its expiration,
the shares with respect to which this Option was not exercised shall no longer
be subject to this Option.
5. Option Non-Transferable. Unless otherwise provided in this Agreement, no
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Option shall be transferable by an Optionee other than by will or the laws of
descent and distribution or, in the case of non-Incentive Stock Options,
pursuant to a Qualified Domestic Relations Order. During the lifetime of an
Optionee, Options shall be exercisable only by such Optionee (or by such
Optionee's guardian or legal representative, should one be appointed).
6. Notice of Exercise of Option. This Option may be exercised by the
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Optionee, or by the Optionee's administrators, executors or personal
representatives, by a written notice (in substantially the form of the Notice of
Exercise attached to this Agreement as Schedule B) signed by the Optionee, or by
such administrators, executors or personal representatives, and delivered or
mailed to the Company as specified in Section 14 below to the attention of the
President, Chief Executive Officer or such other officer as the President or
Chief Executive Officer may designate. Any such notice shall (a) specify the
number of shares of Stock which the Optionee or the Optionee's administrators,
executors or personal representatives, as the case may be, then elects to
purchase hereunder, (b) contain such information as may be reasonably required
pursuant to Section 12 below, and (c) be accompanied by (i) a certified or
cashier's check payable to the Company in payment of the total Exercise Price
applicable to such shares as provided herein, (ii) shares of Stock owned by the
Optionee and duly endorsed or accompanied by stock transfer powers having a Fair
Market Value equal to the total Exercise Price applicable to such shares
purchased under this Agreement, or (iii) a certified or cashier's check
accompanied by the number of shares of Stock whose Fair Market Value when added
to the amount of the check equals the total Exercise Price applicable to the
shares being purchased under this Agreement. Upon receipt of any such notice
and accompanying payment, and subject to the terms hereof, the Company agrees to
issue to the Optionee or the Optionee's administrators, executors or personal
representatives, as the case may be, stock certificates for the number of shares
specified in such notice registered in the name of the person exercising this
Option.
7. Adjustment in Option. The number of Shares subject to this Option, the
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Exercise Price and other matters are subject to adjustment during the term of
this Option in accordance with Section 5.2 of the Plan.
8. Termination of Employment.
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(a) Except as otherwise specified in Schedule A to this Agreement, in the
event of the termination of the Optionee's employment with the Company or any of
its Subsidiaries, other than a termination that is either (i) for cause, (ii)
voluntary on the part of the Optionee and without written consent of the
Company, or (iii) for reasons of death or disability or retirement, the Optionee
may exercise this Option at any time within 30 days after such termination to
the extent of the number of shares which were Purchasable hereunder at the date
of such termination.
(b) Except as specified in Schedule A attached hereto, in the event of a
termination of the Optionee's employment that is either (i) for cause or (ii)
voluntary on the part of the Optionee and without the written consent of the
Company, this Option, to the extent not previously exercised, shall terminate
immediately and shall not thereafter be or become exercisable.
(c) Unless and to the extent otherwise provided in Schedule A hereto, in the
event of the retirement of the Optionee at the normal retirement date as
prescribed from time to time by the Company or any Subsidiary, the Optionee
shall continue to have the right to exercise any Options for shares which were
Purchasable at the date of the Optionee's retirement. Notwithstanding the
foregoing, the Options will become void and unexercisable on the date which is
three months after the date of retirement unless on (or effective as of) the
date of retirement the Optionee enters into a noncompete agreement with the
Company and continues to comply with such noncompete agreement. This Option
does not confer upon the Optionee any right with respect to continuance of
employment by the Company or by any of its Subsidiaries. This Option shall not
be affected by any change of employment so long as the Optionee continues to be
an employee of the Company or one of its Subsidiaries.
9. Disabled Optionee. In the event of termination of employment because of
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the Optionee's Permanent and Total Disability, the Optionee (or his or her
personal representative) may exercise this Option, within a period ending on the
earlier of (a) the last day of the one year period following the Optionee's
death or (b) the expiration date of this Option, to the extent of the number of
shares which were Purchasable under this Agreement at the date of such
termination.
10. Death of Optionee. Except as otherwise set forth in Schedule A with
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respect to the rights of the Optionee upon termination of employment under
Section 8(a) above, in the event of the Optionee's death while employed by the
Company or any of its Subsidiaries or within three months after a termination of
such employment (if such termination was neither (i) for cause nor (ii)
voluntary on the part of the Optionee and without the written consent of the
Company), the appropriate persons described in Section 6 of this Agreement or
persons to whom all or a portion of this Option is transferred in accordance
with Section 5 of this Agreement may exercise this Option at any time within a
period ending on the earlier of (a) the last day of the one year period
following the Optionee's death or (b) the expiration date of this Option. If
the Optionee was an employee of the Company at the time of death, this Option
may be so exercised to the extent of the number of shares that were Purchasable
under this Agreement at the date of death. If the Optionee's employment
terminated prior to his or her death, this Option may be exercised only
to the extent of the number of shares covered by this Option which were
Purchasable under this Agreement at the date of such termination.
11. Date of Grant. This Option was granted by the Committee on the date set
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forth in Schedule A (the "Date of Grant").
12. Compliance with Regulatory Matters. The Optionee acknowledges that the
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issuance of capital stock of the Company is subject to limitations imposed by
federal and state law, and the Optionee hereby agrees that the Company shall not
be obligated to issue any shares of Stock upon exercise of this Option that
would cause the Company to violate law or any rule, regulation, order or consent
decree of any regulatory authority (including without limitation the SEC) having
jurisdiction over the affairs of the Company. The Optionee agrees that he or
she will provide the Company with such information as is reasonably requested by
the Company or its counsel to determine whether the issuance of Stock complies
with the provisions described by this Section 12.
13. Restriction on Disposition of Shares. The shares purchased pursuant to
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the exercise of an Incentive Stock Option shall not be transferred by the
Optionee except pursuant to the Optionee's will, or the laws of descent and
distribution, until such date which is the later of two years after the grant of
such Incentive Stock Option or one year after the transfer of the shares to the
Optionee pursuant to the exercise of such Incentive Stock Option.
14. Miscellaneous.
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(a) This Agreement shall be binding upon the parties hereto and their
representatives, successors and assigns.
(b) This Agreement is executed and delivered in, and shall be governed by the
laws of, the State of Georgia.
(c) Any requests or notices to be given hereunder shall be deemed given, and
any elections or exercises to be made or accomplished shall be deemed made or
accomplished, upon actual delivery thereof to the designated recipient, or three
days after deposit thereof in the United States mail, registered, return receipt
requested and postage prepaid, addressed, if to the Optionee, at the address set
forth below and, if to the Company, to the executive offices of the Company at
0000 Xxxxxxx Xxxxxx Xxxx, Xxxxx 000, Xxxxxxxx, Xxxxxxx, 00000, or at such other
addresses that the parties provide to each other in accordance with the
foregoing notice requirements.
(d) This Agreement may not be modified except in writing executed by each of
the parties to it.
IN WITNESS WHEREOF, the Committee has caused this Stock Option Agreement to be
executed on behalf of the Company, and the Optionee has executed this Stock
Option Agreement, all as of the day and year first above written.
DIRECT ACCESS INTERACTIVE, INC. OPTIONEE
By: /s/ Xxxxx X. Xxxxxxx /s/ Xxxxxxx X. Xxxxxxxx Xx.
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Name: Xxxxx X. Xxxxxxx Name: Xxxxxxx X. Xxxxxxxx Xx.
------------------------- Address: 0000 Xxxxxxxxx Xxxxxx Xxxxxx
Title: President/COO Xxxxxxx, XX 00000
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A-5
SCHEDULE A
TO
STOCK OPTION AGREEMENT
BETWEEN
DIRECT ACCESS INTERACTIVE, INC.
AND
Xxxxxxx X. Xxxxxxxx Xx.
Dated: August 5, 1999
1. Number of Shares Subject to Option: 200,000 Shares.
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2. This Option (Check one) [ X ] is [ ] is not an Incentive Stock Option.
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3. Option Exercise Price: $3.11 per Share.
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4. Date of Grant: August 5, 1999
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5. Option Vesting Schedule:
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Check one:
( ) Options are exercisable with respect to all shares on or
after the date hereof
( X ) Options are exercisable with respect to the number of shares
indicated below on or after the date indicated next to the
number of shares:
No. of Shares Vesting Date
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50,000 On the date of this agreement.
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150,000 One third annually beginning on the first
anniversary of this agreement; 50% of
unvested options vest upon an initial public
offering
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6. Option Exercise Period:
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Check One:
( X ) All options expire and are void unless exercised on or
before August 5, 2009.
( ) Options expire and are void unless exercised on or before
the date indicated next to the number of shares:
No. of Shares Expiration Date
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7. Effect of Termination of Employment of Optionee (if different from that set
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forth in Sections 8 and 10 of the Stock Option Agreement):
SCHEDULE B
TO
STOCK OPTION AGREEMENT
BETWEEN
DIRECT ACCESS INTERACTIVE, INC.
AND
Xxxxxxx X. Xxxxxxxx Xx.
Dated: August 5, 1999
NOTICE OF EXERCISE
The undersigned hereby notifies Direct Access Interactive, Inc. (the
"Company") of this election to exercise the undersigned's stock option to
purchase 30,000 shares of the Company's common stock, no par value per share
(the "Common Stock"), pursuant to the Stock Option Agreement (the "Agreement")
between the undersigned and the Company dated August 5, 1999. Accompanying this
Notice is (1) a promissory note in the amount of $93,300 payable to the Company,
and/or (2) __________ shares of the Company's Common Stock presently owned by
the undersigned and duly endorsed or accompanied by stock transfer powers,
having an aggregate Fair Market Value (as defined in the Company's 1999 Stock
Option and Incentive Plan (the "Plan")) as of the date hereof of
$_______________, and/or (3) authorization to withhold __________ shares of
Stock otherwise issuable upon exercise of the Option having an aggregate Fair
Market Value (as defined in the Plan) as of the date hereof of $_______________,
with such shares of Stock that are withheld being credited against the Exercise
Price, such amounts of (1), (2) and (3) being equal, in the aggregate, to the
purchase price per share set forth in Section 3 of the Agreement multiplied by
the number of shares being purchased hereby (in each instance subject to
appropriate adjustment pursuant to Section 5.2 of the Plan).
IN WITNESS WHEREOF, the undersigned has set his hand and seal, this 5th day of
August, 1999.
Xxxxxxx X. Xxxxxxxx Xx.
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Name:
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