Exhibit 10.28
DATAWATCH
CORPORATION
Incentive Stock Option
Agreement
Datawatch Corporation, a Delaware
corporation (the “Company”), hereby grants as of
[Date] to [Officer] (the
“Employee”), an option to purchase a maximum of [#
of shares] shares (the “Option Shares”) of its
Common Stock, $.01 par value (“Common
Stock”), at the price of [Price] per share, on
the following terms and conditions:
1.
Grant Under 2006 Equity
Compensation and Incentive Plan . This option is granted pursuant to and is
governed by the Company’s 2006 Equity Compensation and
Incentive Plan (the “Plan”) and, unless the context
otherwise requires, terms used herein shall have the same meaning
as in the Plan. Determinations made in connection with this
option pursuant to the Plan shall be governed by the Plan as it
exists on this date.
2.
Grant as Incentive Stock
Option; Other Options . This option is intended to qualify as an
incentive stock option under Section 422 of the Internal
Revenue Code of 1986, as amended (the “Code”).
This option is in addition to any other options heretofore or
hereafter granted to the Employee by the Company or any Related
Corporation (as defined in the Plan), but a duplicate original of
this instrument shall not effect the grant of another
option.
3.
Vesting of Option if
Employment Continues . If the Employee has continued to be
employed by the Company or any Related Corporation on the following
dates, the Employee may exercise this option for the number of
shares of Common Stock set opposite the applicable date:
|
Prior to [Date]
|
|
|
|
-0- shares
|
|
|
|
|
|
|
|
On [Date] and at the end of each
three-month period thereafter
|
|
-
|
|
An additional [ ] shares
(or such smaller number of shares at the end of the last three
month period so that the total does not exceed [# of
shares ] shares.
|
Notwithstanding the foregoing, in
accordance with and subject to the provisions of the Plan, the
Committee may, in its discretion, accelerate the date that any
installment of this Option becomes exercisable. The foregoing
rights are cumulative and (subject to Sections 4 or 5 hereof
if the Employee ceases to be employed by the Company and all
Related Corporations) may be exercised on or before the date which
is seven years from the date this option is granted.
4.
Termination of
Employment .
(a)
Termination Other Than for
Cause .
If the Employee ceases to be
employed by the Company and all Related Corporations, other than by
reason of death or disability as defined in Section 5 or
termination for Cause as defined in Section 4(c), no further
installments of this option shall become exercisable, and this
option shall terminate (and may no longer be exercised) after the
passage of three months from the Employee’s last day of
employment (the “Additional Exercise Period”), but in
no event later than the scheduled expiration date; provided,
however, that, immediately upon the Employee’s completion of
his or her first full year of continuous employment with the
Company the Additional Exercise Period shall increase to twelve
months. Employee acknowledges that if Employee exercises this
option to purchase Option Shares at any time after the passage of
three months from the Employee’s last day of employment, the
option will no longer qualify as an incentive stock option under
Section 422 of
1
the Code and will be treated for all
purposes as a non-qualified stock option. The
Employee’s only rights hereunder shall be those which are
properly exercised before the termination of this
option.
(b)
Termination for
Cause . If the employment of the Employee is terminated
for Cause (as defined in Section 4(c)), this option shall
terminate upon the Employee’s receipt of written notice of
such termination and shall thereafter not be exercisable to any
extent whatsoever.
(c)
Definition of
Cause . “Cause” shall mean conduct involving
one or more of the following: (i) the substantial and
continuing failure of the Employee, after notice thereof, to render
services to the Company or Related Corporation in accordance with
the terms or requirements of his or her employment;
(ii) disloyalty, gross negligence, willful misconduct,
dishonesty or breach of fiduciary duty to the Company or Related
Corporation; (iii) the commission of an act of embezzlement or
fraud; (iv) deliberate disregard of the rules or policies of
the Company or Related Corporation which results in direct or
indirect loss, damage or injury to the Company or Related
Corporation; (v) the unauthorized disclosure of any trade
secret or confidential information of the Company or Related
Corporation; or (vi) the commission of an act which
constitutes unfair competition with the Company or Related
Corporation or which induces any customer or supplier to breach a
contract with the Company or Related Corporation.
5.
Death;
Disability .
(a)
Death
. If the Employee dies while in the employ
of the Company or any Related Corporation, this option may be
exercised, to the extent otherwise exercisable on the date of his
or her death, by the Employee’s estate, personal
representative or beneficiary to whom this option has been assigned
pursuant to Section 9, at any time within 180 days after
the date of death, but not later than the scheduled expiration
date.
(b)
Disability
. If the Employee ceases to be employed by
the Company and all Related Corporations by reason of his or her
disability (as defined in the Plan), this option may be exercised,
to the extent otherwise exercisable on the date of the termination
of his or her employment, at any time within 180 days after
such termination, but not later than the scheduled expiration
date.
(c)
Effect of
Termination . At the expiration of the 180-day period provided
in paragraphs (a) or (b) of this Section 5 or the scheduled
expiration date, whichever is the earlier, this option shall
terminate (and shall no longer be exercisable) and the only rights
hereunder shall be those as to which the option was properly
exercised before such termination.
6.
Partial
Exercise . This option may be exercised in part at any time
and from time to time within the above limits, except that this
option may not be exercised for a fraction of a share unless such
exercise is with respect to the final installment of stock subject
to this option and cash in lieu of a fractional share must be paid,
in accordance with Paragraph 13(G) of the Plan, to permit the
Employee to exercise completely such final installment. Any
fractional share with respect to which an installment of this
option cannot be exercised because of the limitation contained in
the preceding sentence shall remain subject to this option and
shall be available for later purchase by the Employee in accordance
with the terms hereof.
7.
Payment of
Price .
(a) The option
price shall be paid in the following manner:
(i)
in United States dollars in cash or
by check;
(ii)
subject to Section 7(b) below,
by delivery of shares of the Company’s Common Stock having a
fair market value (as determined by the Committee) as of the date
of the exercise equal to the cash exercise price of this
option;
2
(iii)
by delivery of an assignment
satisfactory in form and substance to the Company of a sufficient
amount of the proceeds from the sale of the Option Shares and an
instruction to the broker or selling agent to pay that amount to
the Co
