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Exhibit
10.5
Q UEST S
OFTWARE , I NC .
2008 S TOCK
I NCENTIVE P LAN
O PTION A
GREEMENT
(I NCENTIVE
S TOCK O PTION OR N
ONSTATUTORY S TOCK O
PTION )
Pursuant to your Option Grant
Notice (“ Grant Notice ”) and this Option
Agreement, Quest Software, Inc. (the “ Company
”) has granted you an option under its 2008 Stock Incentive
Plan (the “ Plan ”) to purchase the
number of shares of the Company’s Common Stock indicated in
your Grant Notice (the “ Option Shares ”)
at the exercise price per share indicated in your Grant Notice (the
“ Exercise Price ”). Defined terms not
explicitly defined in this Option Agreement but defined in the Plan
shall have the same definitions as in the Plan.
The details of your option
are as follows:
1. V
ESTING . Subject to the limitations contained
herein, your option will vest as provided in your Grant Notice,
provided that vesting will cease upon the termination of your
Continuous Service.
2. N
UMBER OF S HARES
AND E XERCISE P RICE
. The number of shares of Common Stock subject to your option
and your exercise price per share referenced in your Grant Notice
may be adjusted from time to time for Capitalization
Adjustments.
3. E
XERCISE R ESTRICTION
FOR N ON -E XEMPT E
MPLOYEES . In the event that you are an Employee
eligible for overtime compensation under the Fair Labor Standards
Act of 1938, as amended ( i.e. , a “ Non-Exempt
Employee ”), you may not exercise your option until
you have completed at least six (6) months of Continuous
Service measured from the Date of Grant specified in your Grant
Notice, notwithstanding any other provision of your
option.
4. M
ETHOD OF P AYMENT
. Payment of the exercise price is due in full upon exercise of
all or any part of your option. You may elect to make payment of
the exercise price in cash or by check or in one or more of the
following manners:
(a) Provided that at
the time of exercise the Common Stock is publicly traded and quoted
regularly in The Wall Street Journal , pursuant to a program
developed under Regulation T as promulgated by the Federal Reserve
Board that, prior to the issuance of Common Stock, results in
either the receipt of cash (or check) by the Company or the receipt
of irrevocable instructions to pay the aggregate exercise price to
the Company from the sales proceeds.
(b) Provided that at
the time of exercise the Common Stock is publicly traded and quoted
regularly in The Wall Street Journal , by delivery to the
Company (either by actual delivery or attestation) of already-owned
shares of Common Stock that are owned free and clear of any liens,
claims, encumbrances or security interests, and that are valued at
Fair Market Value on the date of exercise. “Delivery”
for these purposes, in the sole discretion of the Company at the
time you exercise your option, shall include delivery to the
Company of your attestation of
1.
ownership of such shares of
Common Stock in a form approved by the Company. Notwithstanding the
foregoing, you may not exercise your option by tender to the
Company of Common Stock to the extent such tender would violate the
provisions of any law, regulation or agreement restricting the
redemption of the Company’s stock.
5. W
HOLE S HARES . You may exercise
your option only for whole shares of Common Stock.
6. S
ECURITIES L AW C
OMPLIANCE . Notwithstanding anything to the
contrary contained herein, you may not exercise your option unless
the shares of Common Stock issuable upon such exercise are then
registered under the Securities Act or, if such shares of Common
Stock are not then so registered, the Company has determined that
such exercise and issuance would be exempt from the registration
requirements of the Securities Act. The exercise of your option
also must comply with other applicable laws and regulations
governing your option, and you may not exercise your option if the
Company determines that such exercise would not be in material
compliance with such laws and regulations.
7. T
ERM . You may not exercise your option before
the commencement or after the expiration of its term. The term of
your option commences on the Date of Grant and expires upon the
earliest of the following:
(a) thirty
(30) days after the termination of your Continuous Service for
any reason other than your Disability or death; provided,
however, that (i) if during any part of such thirty
(30) day period your option is not exercisable solely because
of the condition set forth in Section 6, your option shall not
expire until the earlier of the Expiration Date or until it shall
have been exercisable for an aggregate period of thirty
(30) months after the termination of your Continuous Service
and (ii) if (x) you are a Non-Exempt Employee,
(y) you terminate your Continuous Service within six
(6) months after the Date of Grant specified in your Grant
Notice, and (z) you have vested in a portion of your option at
the time of your termination of Continuous Service, your option
shall not expire until the earlier of (A) the later of the
date that is seven (7) months after the Date of Grant
specified in your Grant Notice or the date that is thirty
(30) days after the termination of your Continuous Service, or
(B) the Expiration Date;
(b) twelve
(12) months after the termination of your Continuous Service
due to your Disability;
(c) twelve
(12) months after your death if you die either during your
Continuous Service or within thirty (30) days after your
Continuous Service terminates;
(d) the
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