|
<PAGE>
Exhibit 10.4
NEOWARE SYSTEMS, INC.
2004 EQUITY INCENTIVE PLAN
INCENTIVE STOCK OPTION AWARD AGREEMENT
--------------------------------------
Neoware Systems, Inc. (the "Company") hereby grants to
_____________
(the "Optionee") an option (the "Option") to purchase a total of
_________
shares of the Company's Common Stock, at the price and on the
terms set forth
herein, and in all respects subject to the terms and provisions
of the Neoware
Systems, Inc. 2004 Equity Incentive Plan (the "Plan") applicable
to Incentive
Stock Options, which terms and provisions are incorporated by
reference herein.
Unless otherwise defined herein, capitalized terms used but not
defined herein
shall have the meanings given to them in the Plan.
1. NATURE OF THE OPTION. The Option is intended to qualify as
an
incentive stock option within the meaning of Section 422 of the
Code.
2. DATE OF GRANT. The Option is granted as of ________ __, 200_
(the
"Date of Grant").
3. TERM OF OPTION. The Option shall have a term of ten years
from the
Date of Grant and shall terminate at 5:00 p.m. on __________ __,
200_ unless it
is terminated at an earlier date pursuant to the provisions of
this Agreement or
the Plan.
4. OPTION EXERCISE PRICE. The Option exercise price is $____ per
Share.
5. EXERCISE OF OPTION.
5.1 VESTING. Subject to Sections 6.7.4(b) and 12 of the
Plan,
and except as the Committee or the Board may accelerate the
vesting of the
Option in its sole discretion, the Option shall become vested
and will become
exercisable during its term only in accordance with the terms
and provisions of
the Plan and this Award Agreement, over a period of four years,
with the Option
becoming exercisable with respect to 25% of the shares subject
to the Option on
the first, second, third and fourth anniversaries, respectively,
of the Date of
Grant, until the Option is exercisable with respect to 100% of
the shares;
provided that, subject to Section 6.7.4(b) of the Plan, vesting
shall cease upon
the Optionee's termination of employment or other Service.
5.2 RIGHT TO EXERCISE. Subject to the vesting provisions of
Section 5.1 above and the termination provisions of Section 6.7
of the Plan, the
Option may be exercised in whole or in part at any time and from
time to time
during the term of the Option. Any portion of the Option that is
not vested is
not exercisable. The unvested portion of the Option may not be
exercised until
it becomes vested in accordance with Section 5.1.
<PAGE>
5.3 METHOD OF EXERCISE. The Option shall be exercisable by
written notice from the Optionee to the Company setting forth
the Optionee's
election to exercise the Option and the number of shares in
respect of which the
Option is being exercised. Such notice shall be signed by the
Optionee,
delivered to the Company in a manner consistent with Section
13.13 of the Plan,
and accompanied by payment of the exercise price. The Option
will be deemed to
be exercised upon the receipt by the Company of such notice and
payment of the
exercise price. The Optionee shall have no right to vote or
receive dividends
and shall have no other rights as a stockholder with respect to
the shares with
respect to which the Option is exercised, notwithstanding the
exercise of the
Option, until the issuance by the Company (as evidenced by the
appropriate entry
on the books of the Company or of a duly authorized transfer
agent of the
Company) of the stock certificate evidencing the shares that are
being issued
upon exercise of the Option. The Company will issue (or cause to
be issued) such
stock certificates promptly following the exercise of the
Option. The
certificate or certificates for the shares as to which the
Option shall be
exer
| 
