Exhibit 10.2
INCENTIVE STOCK OPTION AGREEMENT
WINLAND ELECTRONICS, INC.
2008 EQUITY INCENTIVE PLAN
THIS AGREEMENT, made effective as of
this
day of
, 20
, by and between Winland Electronics, Inc., a Minnesota corporation
(the “Company”), and
(“Participant”).
W I T N E S S E T H:
WHEREAS, Participant on the date hereof is a key employee or
officer of the Company or one of its Subsidiaries; and
WHEREAS, the Company wishes to grant an incentive stock option to
Participant to purchase shares of the Company’s Common Stock
pursuant to the Company’s 2008 Equity Incentive Plan (the
“Plan”); and
WHEREAS, the Administrator of the Plan has authorized the grant of
an incentive stock option to Participant and has determined that,
as of the effective date of this Agreement, the fair market value
of the Company’s Common Stock is $
per share;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, the parties hereto agree as
follows:
1.
Grant of Option . The Company hereby grants to Participant
on the date set forth above (the “Date of Grant”) the
right and option (the “Option”) to purchase all or any
portion of an aggregate of
(
) shares of Common Stock at a per share price of $
on the terms and conditions set forth herein and subject to
adjustment pursuant to Section 15 of the Plan. This Option is
intended to be an incentive stock option within the meaning of
Section 422, or any successor provision, of the Internal
Revenue Code of 1986, as amended (the “Code”), and the
regulations thereunder, to the extent permitted under Code Section
422(d).
2.
Duration and Exercisability .
a.
General . The term during which this Option may be exercised
shall terminate on
,
, except as otherwise provided in Paragraphs 2(b) through 2(d)
below. This Option shall become exercisable according to the
following schedule:
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Vesting Date
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Number of Shares
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Once the Option becomes exercisable to the extent of one hundred
percent (100%) of the aggregate number of shares specified in
Paragraph 1, Participant may continue to exercise this Option
under the terms and conditions of this Agreement until the
termination of the Option as provided herein. If Participant does
not purchase upon an exercise of this Option the full number of
shares which Participant is then entitled to purchase, Participant
may purchase upon any subsequent exercise prior to this
Option’s termination such previously unpurchased shares in
addition to those Participant is otherwise entitled to
purchase.
b.
Termination of Employment (other than Disability or Death) .
If Participant’s employment with the Company or any
Subsidiary is terminated for any reason other than disability or
death, this Option shall completely terminate on the earlier of
(i) the close of business on the three-month anniversary date
of such termination of employment, and (ii) the expiration
date of this Option stated in Paragraph 2(a) above. In such period
following the termination of Participant’s employment, this
Option shall be exercisable only to the extent the Option was
exercisable on the vesting date immediately preceding such
termination of employment, but had not previously been exercised.
To the extent this Option was not exercisable upon such termination
of employment, or if Participant does not exercise the Option
within the time specified in this Paragraph 2(b), all rights
of Participant under this Option shall be forfeited.
c.
Disability . If Participant’s employment terminates
because of disability (as defined in Code Section 22(e), or
any successor provision), this Option shall terminate on the
earlier of (i) the close of business on the twelve-month
anniversary date of such termination of employment, and
(ii) the expiration date of this Option stated in Paragraph
2(a) above. In such period following the termination of
Participant’s employment, this Option shall be exercisable
only to the extent the Option was exercisable on the vesting date
immediately preceding such termination of employment, but had not
previously been exercised. To the extent this Option was not
exercisable upon such termination of employment, or if Participant
does not exercise the Option within the time specified in this
Paragraph 2(c), all rights of Participant under this Option
shall be forfeited.
d.
Death . In the event of Participant’s death, this
Option shall terminate on the earlier of (i) the close of
business on the twelve-month anniversary date of the date of
Participant’s death, and (ii) the expiration date of
this Option stated in Paragraph 2(a) above. In such period
following Participant’s death, this Option shall be
exercisable by the person or persons to whom Participant’s
rights under this Option shall have passed by Participant’s
will or by the laws of descent and distribution only to the extent
the Option was exercisable on the vesting date immediately
preceding the date of Participant’s death, but had not
previously been exercised. To the extent this Option was not
exercisable upon the date of Participant’s death, or if such
person or persons do not exercise this Option within the time
specified in this Paragraph 2(d), all rights under this Option
shall be forfeited.
3.
Manner of Exercise .
a.
General . The Option may be exercised only by Participant
(or other proper party in the event of death or incapacity),
subject to the conditions of the Plan and subject to such other
administrative rules as the Administrator may deem advisable, by
delivering within the Option Period written notice of exercise to
the Company at its principal office. The notice shall state the
number of shares as to which the Option is being exercised and
shall be accompanied by payment in full of the Option price for all
shares designated in the notice. The exercise of the Option shall
be deemed effective upon receipt of such notice by the Company and
upon payment that complies with the terms of the Plan and this
Agreement. The Option may be exercised with respect to any number
or all of the shares as to which it can then be exercised and, if
partially exercised, may be so exercised as to the unexercised
shares any number of times during the Option period as provided
herein.
b.
Form of Payment . Payment of the option price by Participant
shall be in the form of cash, personal check, certified check or,
if not prohibited by the Administrator, previously acquired shares
of Common Stock of the Company, or any combination thereof. Any
stock so tendered as part of such payment shall be valued at its
Fair Market Value as provided in the Plan. For
purposes
