EXHIBIT 10.5
TERRA NOVA FINANCIAL GROUP,
INC.
INCENTIVE OPTION AGREEMENT
pursuant to the
2005 LONG TERM INCENTIVE PLAN
This
INCENTIVE OPTION AGREEMENT (this " Agreement
") is made and entered into by and between Terra Nova Financial
Group, Inc. , a Texas corporation (the " Company
"), and _________________ (the " Optionee "),
effective as of _______________ (the " Date of Grant
").
1.
Grant of Option . The Company hereby grants to the
Optionee and the Optionee hereby accepts, subject to the terms and
conditions hereof, an Incentive Option (the " Option
") to purchase up to ____________________ (________) shares of the
Company's Common Stock, par value $0.01 per share (the "
Common Stock "), at the Exercise Price per share set
forth in Section 4 below. The Option is intended to constitute an
"incentive stock option" as that term is used in Section 422 of the
Code. To the extent that the aggregate Fair Market Value
(determined on the Date of Grant) of shares of Common Stock with
respect to which Incentive Options are exercisable for the first
time by the Optionee under all plans of the Company and its
Subsidiaries exceeds $100,000, the options or portions thereof
which exceed such limit (according to the order in which they were
granted) shall be treated as Nonstatutory Options. It should be
understood that there is no assurance that the Option will, in
fact, be treated as an Incentive Option.
2.
Governing Plan . This Option is granted pursuant to
the Company's 2005 Long Term Incentive Plan (the "
Plan "), which is incorporated herein for all
purposes. Capitalized terms used but not otherwise defined herein
have the meanings as set forth in the Plan. The Optionee agrees to
be bound by the terms and conditions of the Plan, which control in
case of any conflict with this Agreement, except as otherwise
specifically provided for in the Plan.
3.
Expiration of the Option . The Option shall not be
exercisable after the Company's close of business on the last
Business Day (as defined in Section 11) that occurs prior to the
Expiration Date. The " Expiration Date " shall be the
earliest to occur of:
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(a) |
the _________ anniversary of the
Date of Grant; |
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(b) |
if the Optionee's termination of
employment with the Company and all Subsidiaries occurs by reason
of death, the date that is one hundred eighty (180) days after such
date of death; |
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(c) |
if the Optionee's employment is
terminated by the Company or a Subsidiary, the date that is one
hundred eighty (180) days after such date of
termination; |
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(d) |
if the Optionee resigns in
accordance with a right of termination granted to the Optionee
pursuant to the terms of a written employment agreement with the
Company or a Subsidiary (other than due to Retirement), the date
that is one hundred eighty (180) days after such date of
resignation; and |
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(e) |
if the Optionee resigns and such
resignation is in breach of an employment agreement with the
Company or a Subsidiary, or if the Optionee is not a party to an
employment agreement with the Company or a Subsidiary, the date of
such resignation. |
In the event of the Optionee's termination of employment with the
Company and all Subsidiaries due to Disability or Retirement, the
Expiration Date shall be the ________ anniversary of the Date of
Grant. If the Option is exercised more than ninety (90) days after
a termination of employment described in (c) or (d) above, the
Option will be treated as a Nonstatutory Option.
4.
Exercise Price . The " Exercise Price "
of the Option is ________ per share of Common Stock. The Exercise
Price is subject to adjustment or amendment as set forth in the
Plan.
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5.
Vesting .
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(a) |
Except as may be accelerated as set
forth below, on each vesting date set forth in Column 1 below, the
Option shall vest and become exercisable for the corresponding
number of shares of Common Stock set forth in Column 2 below if the
Optionee's employment with the Company and/or any Subsidiary has
not terminated. The " Vested Portion " of the Option
as of any particular date shall be the cumulative total of all
shares for which the Option has become exercisable as of that
date. |
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Column 1
Vesting Date
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Column 2
Vested Portion of the Option
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(b) |
If the Optionee's employment is
terminated by the Company or a Subsidiary and the termination
results in a breach by the Company or the Subsidiary of the terms
of a written employment agreement with the Optionee, then the
Vested Portion of the Option shall be 100% of the shares of Common
Stock covered by the Option. |
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(c) |
If the Optionee resigns in
accordance with a right of termination granted to the Optionee
pursuant to the terms of a written employment agreement with the
Company or a Subsidiary (other than due to Retirement), then the
Vested Portion of the Option shall be 100% of the shares of Common
Stock covered by the Option. |
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(d) |
In the event of a
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