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OPTION GRANT AGREEMENT

Option Agreement

OPTION GRANT AGREEMENT | Document Parties: TRI-ISTHMUS GROUP, INC. | Dennis M. Smith You are currently viewing:
This Option Agreement involves

TRI-ISTHMUS GROUP, INC. | Dennis M. Smith

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Title: OPTION GRANT AGREEMENT
Date: 12/21/2007

OPTION GRANT AGREEMENT, Parties: tri-isthmus group  inc. , dennis m. smith
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Exhibit 10.2
TRI-ISTHMUS GROUP, INC.
OPTION GRANT AGREEMENT
     This Option Grant Agreement (this “ Option Agreement ”) is entered into as of October 10, 2007 (the “ Date of Grant ”), by and between Dennis M. Smith (“ Optionee ”) and Tri-Isthmus Group, Inc. (the “ Company ”). Capitalized terms not otherwise defined herein shall have the meanings assigned to such terms in Section 13 of this Option Agreement.
     1.  Grant of Option . The Company hereby grants to Optionee an option (the “ Option ”) to purchase the number of shares of the Company’s Common Stock set forth below (the “ Option Shares ”), at the exercise price set forth below, subject to the terms and conditions of the Plan and this Option Agreement, and upon the occurrence of certain specified events, as follows:
         
Exercise Price Per Share
    0.3125  
Total Number of Option Shares Granted
    600,000  
Total Exercise Price
  $ 187,500  
Type of Option:
    Incentive Stock Option  
Term/Expiration Date:
    7 years from Date of Grant  
     This Option is intended to qualify as an Incentive Stock Option as defined in Section 422(b) of the Code; provided, however, the Company has not made, and will not be deemed to make hereby, any representations or warranties to Optionee with respect to such qualification.
     2.  Vesting Schedule . Optionee’s Option to purchase up to six hundred thousand (600,000) Option Shares shall vest incrementally as follows: (1) the option to purchase up to one hundred fifty thousand (150,000) Option Shares shall vest immediately on the Date of Grant; (2) the option to purchase up to one hundred fifty thousand (150,000) Option Shares shall vest on the first anniversary of the Date of Grant; and (3) the option to purchase the remaining three hundred thousand (300,000) Option Shares shall vest on the second anniversary of the Date of Grant.
     3.  Exercise of Option .
     (a) Right to Exercise; Term of Option . Generally, this Option shall be exercisable by Optionee with respect to any or all vested Option Shares from the time such Option Shares vest (in accordance with the vesting schedule in Section 2 ) until the seventh anniversary of the Date of Grant (the “ Term ”), subject to the terms and conditions set forth in the Plan and this Option Agreement.
     (b) Method of Exercise . This Option shall be exercisable by written notice (in substantially the form attached hereto as Exhibit A ) which shall state the election to exercise the Option, the number of Option Shares in respect of which the Option is being exercised, and such other representations and agreements as to the Optionee’s investment intent with respect to the Option Shares. Such written notice shall be signed by the Optionee and shall be delivered in person or by certified mail to the Secretary of the Company. The written notice shall be accompanied by payment of the aggregate exercise price for the Option Shares in respect of which the Option is being exercised, payable in the manner set forth in Section 4 .
     (c) Date of Exercise, Transfer . This Option shall be deemed to be exercised upon receipt by the Company of such written notice accompanied by the aggregate exercise price of the

 


 
Option Shares in respect of which the Option is being exercised. Assuming compliance with all other provisions of this Option Agreement, for income tax purposes the Option Shares shall be considered transferred to the Optionee on the date on which the Option is exercised with respect to such Option Shares.
     4.  Payment of Aggregate Exercise Price.
     (a) Method of Payment . Payment of the aggregate exercise price for the Option Shares in respect of which the Option is being exercised shall become immediately due upon exercise of this Option and shall be payable:
     (i) in cash or check made payable to the Company;
     (ii) in shares of Common Stock held for the requisite period necessary to avoid a charge to the Company’s earnings for financial reporting purposes and valued at Fair Market Value on the date in which this Option is exercised; or
     (iii) through a special sale and remittance procedure pursuant to which the Optionee shall concurrently provide irrevocable instructions (i) to a Company-designated brokerage firm to effect the immediate sale of the purchased shares and remit to the Company, out of the sale proceeds available on the settlement date, sufficient funds to cover the aggregate exercise price payable for the purchased shares plus all applicable federal, state and local income and employment taxes required to be withheld by the Company by reason of such exercise and (ii) to the Company to deliver the certificates for the purchased shares directly to such brokerage firm in order to complete the sale.
     (b) Taxes . The Optionee shall, upon notification of the amount due (if any) as a result of the exercise of the Option and prior to or concurrent with delivery of the certificate representing the Option Shares, pay to the Company the amounts necessary to satisfy applicable federal, state and local tax withholding requirements.
     5.  Restrictions on Exercise . This Option may not be exercised if the issuance of such Option Shares upon such exercise or the method of payment of consideration for such shares would constitute a violation of any applicable federal or state securities or other law or regulation, including any rule under Part 207 of Title 12 of the Code of Federal Regulations as promulgated by the Federal Reserve Board.
     6.  Limited Transferability of Option . This Option shall be exercisable only by the Optionee during his lifetime and shall not be assignable or transferable, other than by will or by the applicable laws of inheritance and as permitted under the Code following the Optionee’s death. The terms and conditions of this Option Agreement, including (without limitation) the limited time period during which this Option may be exercised following the Optionee’s death, shall be binding upon the executors, administrators, heirs, successors and permitted assigns of the Optionee.
     7.  Effect of Termination or Death . The following provisions shall govern the exercise of this Option at or after the time of cessation of Service or death of the Optionee:
     (a) Should the Optionee cease to remain in Service for any reason other than death, Disability or Misconduct, then the Optionee shall have a period of three (3) months following the date of such cessation of Service during which to exercise this Option as to shares that vested on or prior to the date of cessation. Upon such cessation of Service, this Option shall immediately

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terminate and cease to be outstanding with respect to any and all Option Shares which are not, at the time, vested.
     (b) Should Optionee’s Service terminate by reason of Disability while holding this Option, the vesting of this Option will thereupon accelerate and all of the unvested Option Shares subject thereto will immediately vest and become exercisable. The Optionee shall have a period of twelve (12) months following the date of such termination of Service during which to exercise this Option.
     (c) If the Optionee dies while holding this Option, the vesting set forth in Section 2 will thereupon accelerate and all of the unvested Option Shares subject thereto will immediately vest and become exercisable. The personal representative of the Optionee’s estate or the person or persons to whom this Option is transferred pursuant to the Optionee’s will or the applicable laws of inheritance shall have a period of twelve (12) months following the date of the Optionee’s death to exercise this Option.
     (d) Under no circumstances, however, shall this Option be exercisable after the expiration of the Term.
     (e) Upon the expiration of the applicable exercise period or (if earlier) upon the expiration of the Term, this Option shall terminate and cease to be outstanding for any vested Option Shares for which this Option has not been exercised.
     (f) Should Optionee’s Service be terminated for Misconduct or should the Optionee otherwise engage in Misconduct while holding this Option Agreement, then the Option and this Option Agreement (whether any or all Option Shares are vested or not) shall terminate immediately and cease to remain outstanding.
     8.  Changes in Capital Structure . The Optionee agrees and acknowledges that the Company shall have the right at any time and from time to time after the date of this Option Agreement to authorize additional classes or series of capital stock, some of which may enti

 
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