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EXHIBIT 4.2
[Form of Agreement - Option Grants to Employees]
TUXIS CORPORATION
STOCK OPTION AWARD AGREEMENT
THIS STOCK OPTION AWARD AGREEMENT (the "Agreement") is made
and
entered into as of __________, _____, between Tuxis Corporation,
a Maryland
corporation (the "Company"), and ______________ (the
"Participant") pursuant to
the terms and conditions of the Company's 2006 Incentive
Compensation Plan (the
"Plan"). In the event of any conflict between the Agreement and
the Plan, the
terms of the Plan will govern. Unless otherwise provided,
capitalized terms not
defined in the Agreement shall have the meanings set forth in
the Plan. The
Options (as defined below) will lapse and be of no effect if a
copy of the
Agreement, properly signed by the Participant, is not received
by the Secretary
of the Company on or before the thirtieth (30th) day after the
date hereof,
unless the Company (in its sole discretion) elects in writing to
extend that
date.
1. Award of Options. Pursuant to the Plan, the Company hereby
awards to the
Participant options (the "Options") to purchase the number of
shares of
common stock, par value $.01 per share, of the Company (the
"Stock") set
forth in Exhibit A hereto. The exercise price per share (the
"Exercise
Price") of the Stock subject to the Options shall be as is set
forth in
Exhibit A. The Options include [Incentive Stock Options] [and
non-qualified
stock Options, as applicable,] as set forth on Exhibit A hereto;
provided,
however, that to the extent, but only to the extent, that the
provisions of
the Agreement or the nature of any actions taken by the
Participant are
inconsistent with the treatment of the Options as Incentive
Stock Options,
the Options shall be deemed to be non-qualified stock Options. A
copy of
the Plan and the Plan Prospectus has been delivered to the
Participant. By
signing below, the Participant agrees to be bound by all the
provisions of
the Agreement and the Plan.
2. Vesting Schedule. Subject to the terms of the Plan and
Section 6 hereof,
the Options shall vest and become exercisable as set forth in
Exhibit A
hereto.
3. Expiration Date. Subject to the terms of the Plan and Section
6 hereof, the
Options shall expire five (5) years from the date hereof (the
"Expiration
Date").
4. Exercise Procedures.
a. Exercise Notice. To exercise all or any part of the
Options,
the Participant (or after the Participant's death, the
Participant's estate or any person who has acquired the
Options by bequest or inheritance) must first obtain
authorization from the Secretary of the Company by
submitting a Notice of Exercise in the form attached as
Exhibit B hereto to the Secretary of the Company or by other
means acceptable to the Secretary of the Company.
(1)
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b. Payment of Exercise Price and Delivery of Shares. The
Exercise Price of the shares as to which Options are
exercised may be paid to the Company at the time of exercise
(i) in cash, (ii) by delivery to the Company of shares of
Stock, (iii) in any combination of cash and shares of Stock,
or (iv) by delivery of such other consideration as the
Committee deems appropriate and in compliance with
applicable law (including payment in accordance with a
cashless exercise program under which, if so instructed by
the Participant, shares of Stock may be issued directly to
the Participant's broker or dealer upon receipt of the
Exercise Price in cash from the broker or dealer). In the
event that any shares of Stock shall be transferred to the
Company to satisfy all or any part of the Exercise Price,
the part of the Exercise Price deemed to have been satisfied
by such transfer of shares of Stock shall be equal to the
product derived by multiplying the Fair Market Value per
share of Stock as of the date of exercise times the number
of shares of Stock transferred to the Company. The
Participant may not transfer to the Company in satisfaction
of the Exercise Price any fraction of a share of Stock, and
any portion of the Exercise Price that would represent less
than a full share of Stock must be paid in cash by the
Participant. Certificates for the purchased shares of Stock
will be issued and delivered to the Participant as soon as
practicable after the receipt of such payment of the
Exercise Price; provided, however, that delivery of any such
shares of Stock shall be deemed effective for all purposes
when a stock transfer agent of the Company shall have
deposited such certificates in the United States mail,
addressed to the Participant, at the address set forth in
Exhibit A hereto or to such other address as the Participant
may from time to time designate in a written notice to the
Company.
5. Non-transferability. Except to the extent otherwise
determined by the
Committee, the Options granted hereunder shall not be assignable
or
otherwise transferable other than by will or the laws of descent
and
distribution or to a Beneficiary upon the death of the
Participant. Unless
otherwise provided by the Committee, during the Participant's
lifetime the
Options shall be exercisable and elections with respect to the
Options may
be made only by the Participant or the Participant's guardian or
legal
representative.
6. Termination of Employment.
a. Upon the Participant's termination of employment other
than
by reason of death or Disability, the Participant may,
within three months from the date of such termination of
employment, exercise all or any part of the Options as were
exercisable at the date of termination of employment but
only if (x) the Participant resigns or retires and the
Committee consents to such resignation or retirement or (y)
if the Company initiates such termination, such termination
of employment is not for Cause. If such termination of
employment is for Cause or the Committee does not so
consent, the right of the Participant to exercise the
Options shall terminate at the date of termination of
employment. In no event, however, may any Option be
exercised after the time when it would otherwise expire.
(2)
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b. Disability. Upon a Participant's Disability Date, the
Participant may, within one year after the Disability Date,
exercise all or a part of the Options that were exercisable
upon such Disability Date. In no event, however, may any
Option be exercised after the time when it would otherwise
expire.
c. Death. In the event of the death of the Participant while
employed by the Company, or prior to the expiration of the
Options as provided in Section 6.b above, to the extent all
or any part of the Options were exercisable as of the date
of the Participant's death, the right of the Participant's
Beneficiary to exercise the Options shall expire upon the
expiration of one year from the date of the Participant's
death (but in no event more than one year from the
Participant's Disability Date) or on the Expiration Date,
whichever is earlier. In all other cases of death following
the Participant's termination of employment, the
Participant's Beneficiary may exercise the Options within
the remaining time, if any, provided in Section 6.a above.
In the event of the Participant's death, the Committee may,
in its sole discretion, accelerate the right to exercise all
or any part of the Options that would not otherwise be
exercisable.
7. Withholding Tax. The Company shall be entitled to withhold
(or secure
payment from the Participant in lieu of withholding) the amount
of any
withholding or other tax required by law to be withheld or paid
by the
Company with respect to any shares of Stock issuable under the
Agreement,
or upon a disqualifying disposition of shares of Stock received
pursuant to
the exercise of Incentive Stock Options, and the Company may
defer issuance
of shares of Stock upon exercise of the Options unless the
Company is
indemnified to its satisfaction against any liability for any
such tax. The
amount of such withholding or tax payment shall be determined by
the
Committee or its delegate and shall be payable by the
Participant at such
time as the Committee determines. The Participant may satisfy
his or her
tax withholding obligation by the payment of cash to the Company
and/or by
the withholding from the Options, at the appropriate time, of a
number of
shares of Stock sufficient, based upon the Fair Market Value of
such shares
of Stock, to satisfy such tax withholding requirements. The
Committee shall
be authorized, in its sole discretion, to establish such rules
and
procedures relating to any such withholding methods as it deems
necessary
or appropriate, including, without limitation, rules and
procedures related
to elections to have shares of Stock withheld upon exercise of
the Options
to meet such withholding obligations.
8. Counterparts. This Agreement may be executed in any number of
counterparts,
each of which shall be deemed an original, but all of which
together shall
constitute one and the same instrument.
9. Governing Law. This Agreement shall be governed by the laws
of the State of
Maryland, without regard to conflict of law principles.
(3)
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IN WITNESS WHEREOF, the parties hereto have executed the
Agreement
as of the day and year first above written.
TUXIS CORPORATION
By: _____________________
Name:
Title:
[NAME OF PARTICIPANT]
___________________________
(4)
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EXHIBIT A
TERMS OF STOCK OPTION AWARD
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