Exhibit 10.12
¨ Grantee’s
Copy
¨ Company's
Copy
COSTAR GROUP, INC.
2007 STOCK INCENTIVE
PLAN
NONQUALIFIED STOCK OPTION
AGREEMENT
To Andrew C.
Florance:
CoStar Group, Inc. (the " Company ") has
granted you a nonqualified stock option (the " Option ")
under the CoStar Group, Inc. 2007 Stock Incentive Plan, as amended
from time to time (the " Plan "), to purchase
«NoShares» shares (the " Shares ") of common
stock of the Company (the " Common Stock "), at
«Price» per share (the " Exercise
Price"). The date of grant
is
«DateofGrant».
This Option is subject in all respects to the
applicable provisions of the Plan, a copy of which is attached,
except as otherwise noted. By signing this agreement
(the " Agreement "), you acknowledge that you have received
and read the Plan. This Agreement incorporates the Plan
by reference and specifies other applicable terms and
conditions. All capitalized terms not defined by this
Agreement have the meanings given in the Plan. The
Compensation Committee of the Company's Board of Directors (or
other administrator of the Plan, the " Administrator ") may
adjust the number of Shares and the Exercise Price with respect to
your Option from time to time in accordance with the
Plan.
This Option is not intended to be an incentive
stock option under Section 422 of the Internal Revenue Code of
1986, as amended, and will be interpreted accordingly.
In addition to the terms, conditions, and
restrictions set forth in the Plan, the following terms,
conditions, and restrictions apply to the Option:
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Vesting . The schedule for exercising the
Option is as follows, subject to the expiration provisions set
forth in Section 3 below:
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You may
exercise the Option on the following schedule:
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[Set forth
vesting schedule.]
Except as
specifically provided otherwise herein, no portion of the Option
that is unexercisable at your termination of employment will
thereafter become exercisable, unless the Administrator determines
otherwise.
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The Option will
become immediately exercisable in full upon the occurrence of a
Change in Control.
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“
Change in Control ” means the occurrence of any one or
more of the following events:
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a Person (as
the term person is used for purposes of Section 13(d) or 14(d) of
the Securities Exchange Act of 1934, as amended) (other than the
Company, any Company subsidiary, any Company benefit plan, or any
underwriter temporarily holding securities for an offering of such
securities) acquires ownership of more than 80% of the undiluted
total voting power of the Company’s then outstanding
securities eligible to vote to elect members of the Board (the
“ Company Voting Securities ”);
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consummation of
a merger, consolidation or reorganization of the Company with or
into any other entity, unless the holders of the Company Voting
Securities outstanding immediately before such consummation,
together with any trustee or other fiduciary holding securities
under a Company benefit plan, hold securities that represent
immediately after such merger or consolidation at least 20% of the
combined voting power of the then outstanding voting securities of
either the Company or the other surviving entity or its parent;
or
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the
stockholders of the Company approve (A) a plan of complete
liquidation or dissolution of the Company or (B) an agreement for
the Company’s sale or disposition of all or substantially all
of the Company’s assets, and such liquidation,
dissolution, sale or disposition is consummated.
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Even if other
tests are met, a Change in Control has not occurred under any
circumstances in which the Company files for bankruptcy protection
or is reorganized following a bankruptcy filing.
The provisions
of Section 4 will also apply if the Change in Control is a
Substantial Corporate Change (as defined in those
provisions).
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Subject to, and
as permitted by, the Plan that portion of the Option that is not
otherwise exercisable will become immediately exercisable in full
upon:
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the termination
of your employment by the Company without Cause (as defined in the
Employment Agreement between Andrew C. Florance and the Company
effective as of January 1, 1998, as amended (the “Employment
Agreement”)) pursuant to Section 7(a) of the Employment
Agreement; or
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the termination
of your employment by you for Good Reason (as defined in the
Employment Agreement) pursuant to Section 7(c) of the Employment
Agreement.
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Upon the
termination of your employment on account of your Disability (as
defined in the Employment Agreement) pursuant to Section 9 of the
Employment Agreement or in the event of your death, a pro rata
portion of your unvested Options that would have become otherwise
exercisable during the calendar year of your termination will
become exercisable immediately. Such pro rata amount
shall be determined by multiplying the number of unvested options
that would have vested in the calendar year of termination by a
fraction, the numerator of which is the number of complete weeks
you were employed during the year of termination and the
denominator of which is fifty-two.
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The
Administrator may, in its sole discretion (subject to, and as
permitted by, the Plan), accelerate the time at which you may
exercise part or all of the Option.
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The vesting
period and/or exercisability of the Option may be adjusted by the
Administrator to reflect the decreased level of employment during
any period in which you are on an approved leave of absence or
employed on a less than full time basis, provided, that the
Administrator may take into consideration any accounting
consequences to the Company.
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Exercise . Subject to this Agreement and the
Plan, unless the Administrator determines otherwise, you may
exercise the Option only by a written “Notice of
Exercise” to the Company or its designee on a form specified
by the Company on or before the date the Option
expires. Unless the Administrator determines otherwise,
each such Notice must:
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state your
election to exercise the Option and the number of Shares with
respect to which you are exercising the Option;
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be signed by
you or, if you have died or become disabled, by the party entitled
to exercise the Option;
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c.
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contain such
representations as the Company reasonably requires; and
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d.
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be accompanied
by payment of the Exercise Price in full through one, or a
combination, of the following payment methods, which method(s)
shall be indicated in the Notice of Exercise:
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cashier's or
certified check in the amount of the Exercise Price payable to the
order of the Company;
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direction to
the Company through your Notice of Exercise to send the share
certificates to be issued under this Option to a licensed broker
acceptable to the Company as your agent in exchange for the
broker's tendering to the Company cash (or acceptable cash
equivalents) equal to the Exercise Price, for the Shares with
respect to which the Option is being exercised, as part of a
cashless exercise;
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unless the
Administrator determines otherwise, by surrender to the Company of
shares of Common Stock with a Fair Market Value on the date of
exercise equal to all or part of the Exercise Price (with any
balance paid by cash or check or, unless the Administrator
determines otherwise, deducted from salary or other amounts payable
to you), for the Shares with respect to which the Option is being
exercised; provided, however , that you may not surrender
(turn in) previously held or owned Common Stock of the Company as
payment unless you have held such stock for more than six months
before the surrender. For purposes hereof, the date of
exercise shall be the date of delivery of (A) the duly executed
Notice of Exercise and (B) the shares tendered for payment
of the Exercise Price;
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unless the
Administrator determines otherwise, attestation of ownership of
Common Stock and issuance of a net number of shares upon Option
exercise; or
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unless the
Administrator determines otherwise, by the Company withholding from
the shares of Common Stock otherwise issuable to you upon the
exercise of the Option (or portion thereof) the whole number of
shares with a Fair Market Value on the date of exercise equal to
all or part of the Exercise Price (rounded down, with any balance
paid by cash or check or, unless the Administrator determines
otherwise, deducted from salary or other amounts payable to you on
such date of exercise). For purposes hereof, the date of
exercise shall be the date of delivery of the duly executed Notice
of Exercise.
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The Company shall not be obligated to issue any
shares of Common Stock until you have paid the total Exercise Price
for that number of shares of Common Stock you have elected to
purchase. Shares of Common Stock will be issued as soon
as is practical after exercise.
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Expiration . The Option will expire no later
than the close of business on «ExpirationDate» (ten
years from the date of grant).
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The exercise period for the Options shall be
until the first to occur of:
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the Option's
expiration under the preceding sentence,
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the 60
th day after the cessation of your employment as a
result of the termination of your employment by you without Good
Reason pursuant to Section 7(d) of the Employment
Agreement;
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the 60
th day after the cessation of your employment as a
result of the termination of your employment by the Company for
Cause pursuant to Section 7(b) of the Employment
Agreement;
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the 180
th day after the cessation of your employment as a
result of the termination of your employment (a) by the Company
without Cause pursuant to Section 7(a) of the Employment Agreement
or (b) by you for Good Reason pursuant to Section 7(c) of the
Employment Agreement;
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one year after
the cessation of your employment as a result of the termination of
your employment for Disability;
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the first
anniversary of your date of death; and
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after the
termination of your employment, the date you violate any covenant
not to compete, nonsolicitation covenant or similar covenant in
effect between you and th
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