AGREEMENT made as of _______________ between GENERAL DATACOMM
INDUSTRIES, INC., a Delaware corporation having offices at Park Road Extension,
Middlebury, Connecticut ("Grantor") and ______________ ("Optionee").
WITNESSETH:
WHEREAS, Grantor is desirous of inducing Optionee to accept employment
by the Grantor,
NOW THEREFORE, in consideration of the promise of the Optionee to remain
in the continuous service of the Grantor for a period of at least one year from
the date of the granting of this option at the pleasure of the Board of
Directors at such compensation as the Board or the Chairman of the Board shall
reasonably determine, and for other good and valuable consideration, the Grantor
hereby grants the Optionee Incentive Stock Options to purchase common stock of
the Grantor on the following terms and conditions:
l. OPTION. Pursuant to its 1998 Stock Option Plan (Non-Statutory) the
Grantor hereby grants to the Optionee the option to purchase up to ________
shares of common stock, par value l0 cents per share, of the Grantor to be
issued upon the exercise hereof, fully paid and non-assessable, during the
following periods.
(a) No shares may be purchased prior to the expiration of twelve (12)
months from the date of this option (unless otherwise authorized by
the Board of Directors) or after ten (10) years from the date thereof.
(b) All or any part of shares may be purchased during the period
commencing and terminating at 5:00 p.m. on
(c) All or any part of shares may be purchased during the period
commencing and terminating at 5:00 p.m. on
(d) All or any part of shares may be purchased during the period
commencing and terminating at 5:00 p.m. on
2. PURCHASE PRICE. The purchase price shall be per share, payable
in cash or by check (subject to collection) to the Grantor, or in the
alternative, payment may be made by delivery of common stock of the Grantor
valued at the closing price of such common stock on the New York Stock
Exchange on the date of exercise. The Grantor shall pay all original issue
or transfer taxes on the exercise of this option and all other fees and
expenses necessarily incurred by the Grantor in connection therewith.
3. EXERCISE OF OPTION. The Optionee shall notify the Grantor by registered
mail addressed to its principal offices as to the number and class of
shares which Optionee desires to purchase under the options herein granted,
which notice shall be accompanied by payment (by cash, check or stock of
the Grantor as above provided) of the option price therefore as specified
in paragraph 2 above. As soon as possible thereafter the Grantor shall, at
its principal office, tender to Optionee certificates issued in the
Optionee's name evidencing the shares purchased by the Optionee.
4. OPTION CONDITIONED ON CONTINUED EMPLOYMENT.
(a) Each of the aforesaid options shall terminate and be void if the Optionee
is not in the employ of the Grantor on the date in which such option is
first exercisable.
(b) The Optionee shall have the right to purchase the shares as to which the
options shall become exercisable only while Optionee is employed by the
Grantor, except if the Optionee's employment has terminated for any reason
other than death or disability, the options may be exercised to the extent
that they are exercisable upon the effective date of such termination, at
any time within three (3) months after the date of termination but in no
event after the expiration of the last option herein contained, provided if
employment is terminated for cause or without the Optionee having given
reasonable written notice [not less than thirty (30) days unless waived in
writing by the Chairman of the Board] the options shall immediately
terminate.
5. DIVISIBILITY AND NON-ASSIGNABILITY OF THE OPTIONS.
(a) The Optionee may exercise the options herein granted from time to time
during the periods of their respective effectiveness with respect to any
whole number of shares included therein.
(b) The Optionee may not give, grant, sell, exchange, transfer legal title,
pledge, assign or otherwise encumber or dispose of the options herein
granted or any interest therein, otherwise than by will or the laws of
descent and distribution, and these options, or any of them, shall be
exercisable during Optionee's lifetime only by the Optionee.
(c) In the event of the Optionee's death while employed by the Grantor or
within three (3) months of the termination of Optionee's employment [unless
such termination was either for cause or without the Optionee having given
reasonable notice (not less than 30 days unless waived in writing by the
Chairman of the Board)] Optionee's estate, or any person who acquired the
right to exercise such option by bequest or inheritance or by reason of the
death of the Optionee, shall have the right at any time within a period of
one (1) year after the Optionee's death, but not after ten (10) years from
the date hereof, to exercise this option to the extent of the following
schedule:
TIME FROM GRANTING OF OPTION PERCENTAGE EXERCISABLE
From To the End of
1 day 12 mos. 33%
12 mos. 24 mos. 67%
after 24 mos. 100%
(d) In the event of the Optionee's permanent and total disability while
employed by the Grantor, the Optionee shall have the right at any time
within a period of one (1) year after cessation of Optionee's employment,
but not after ten (10) years from the date hereof, to exercise this option
to the extent of the above schedule. For this purpose, the Optionee shall
be considered permanently and totally disabled if Optionee is unable to
engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment which can be expected to result
in death or which has lasted or can be expected to last for a continuous
period of not less than twelve (12) months. The Optionee shall not be
considered permanently and totally disabled unless Optionee furnishes proof
of the existence thereof in such form and manner and at such times as a
committee appointed by the Chairman of the Board of Grantor may require.
The Optionee agrees that said committee's determination as to whether the
Optionee is permanently and totally disabled shall be final and absolute,
and not subject to question by the Optionee, a representative of the
Optionee, or the Grantor.
6. STOCK AS INVESTMENT. By accepting this option the Optionee agrees for the
Optionee, Optionee's heirs and legatees that unless the shares have been
registered under the Securities Act of 1933, as amended, any and all shares
purchased hereunder shall be acquired for investment and not for
distribution, and upon the issuance of any or all of the shares subject to
the option granted hereunder, the Optionee, or Optionee's heirs or legatees
receiving such shares, shall deliver to the Grantor a representation in
writing that such shares are being acquired in good faith for investment
and not for distribution. Grantor may place a "stop transfer" order with
respect to such shares with its transfer agent and place an appropriate
restrictive legend on the stock certificate unless such shares are
registered.
7. RESTRICTION ON ISSUANCE OF SHARES. The Grantor shall not be required to
issue or deliver any certificate for shares of its capital stock purchased
upon the exercise of this option:
(a) prior to the admission of such shares to listing on any stock exchange on
which the stock may at that time be listed and, in the event of the
exercise of this option with respect to any shares of stock subject hereto,
the Grantor shall make prompt application for such listing;
(b) unless the prior approval of such sale or issuance has been obtained from
any state regulatory body having jurisdiction; or
(c) unless the shares with respect to which the option is being exercised have
been registered under the Securities Act of 1933, as amended, or are exempt
from registration.
8. ADJUSTMENT OF SHARES.
(a) If additional shares of common stock are issued by the Grantor pursuant to
a stock split or stock dividend in excess of 5% in any one fiscal year of
the Grantor, the number of shares of common stock then covered by each
option granted herein shall be increased proportionately with no increase
in the total purchase price of the shares then so covered. In the event
that the shares of common stock of the Grantor are reduced at any time by a
combination of shares, the number of shares of common stock then covered by
each option granted herein shall be reduced proportionately with no
reduction in the total price of the shares then so covered. If the Grantor
shall be reorganized, consolidated or merged with another corporation, or
if all or substantially all of the assets of the Grantor shall be sold or
exchanged, the Optionee shall, at the time of issuance of the stock under
such a corporate event, be entitled to receive upon the exercise of his
option, the same number and kind of shares of stock or the same amount of
property, cash or securities as he would have been entitled to receive upon
the happening of any such corporate event as if he had been, immediately
prior to such event, the holder of the number of shares covered by this
option. No option adjustment shall be made for stock dividends or stock
splits which are not in excess of 5% in any one fiscal year (even though
the cumulated total of such stock dividends over the life of an option may
be in excess of 5%), cash dividends or the issuance to stockholders of the
Company of rights to subscribe for additional common stock or other
securities.
(b) Any adjustment in the number of shares shall apply proportionately to only
the unexercised portion of an option granted hereunder. If fractions of a
share would result from any such adjustment, the adjustment shall be
revised to the next higher whole number of shares.
9. NO RIGHTS IN OPTION STOCK. Optionee shall have no rights as a stockholder
in respect of shares as to which the option shall not have been exercised
and payment made as herein provided and shall have no rights with respect
to such shares not herein provided.
10. NO CONTRACT OF EMPLOYMENT. Optionee further represents, covenants and
warrants this Agreement does not constitute a contract of employment with
the Grantor or any of its subsidiaries or affiliates, nor does it give the
Optionee any right to be employed by the Grantor, and that unless Optionee
has a written contract of employment signed by the Grantor, Optionee's
employment is terminable at will by Grantor, with or without cause.
11. BINDING EFFECT. Except as herein otherwise expressly provided, this
Agreement shall be binding upon and inure to the benefit of the parties
hereto, their legal representatives and assigns.
12. JURISDICTION OF DISPUTES. The appropriate Federal or State Courts of or
located in the State in which the Grantor has its principal executive
offices shall have exclusive jurisdiction of all disputes arising under
this Agreement.
13. COVENANT NOT TO COMPETE AND CANCELLATION AND RESCISSION OF OPTIONS. As a
condition for acceptance of this Agreement, Optionee agrees that during the
one (1) year period following Optionee's termination of employment for any
reason (excluding any such termination by Grantor), Optionee shall not,
directly or indirectly, work for or render any services to any person, firm
or business located within a 150 mile radius of Grantor's Corporate office
in Middlebury, Connecticut which offers products and/or services
competitive to the products and/or services of Grantor. Upon termination,
in order to ascertain if future employment would be deemed to be in
non-compliance with this covenant, an Optionee should notify the Grantor as
to Optionee's future employer and make a request for approval to retain
Optionee's rights under this option on the basis of demonstrating that
Optionee is not entering into a competitive situation. If a non-competitive
situation is demonstrated to the Company's satisfaction, then such approval
shall not be unreasonably withheld. In the event Optionee fails to comply
with or otherwise breaches this covenant in any way, (i) all unexercised
options shall immediately be rescinded and be of no further force or
effect, and (ii) during the two year period following any such termination,
Grantor may notify Optionee in writing of the rescission of any options
exercised by Optionee after any such termination and/or within nine (9)
months prior to any such termination of Optionee's employment. Within ten
(10) days after receiving such a notice from Grantor, the Optionee shall
pay to Grantor in cash, the aggregate amount of any gain resulting from the
exercise by Optionee of such rescinded options and the subsequent sales of
the shares received on such exercise or, if no such sale of said shares has
occurred, at Grantor's demand, return the shares received on the exercise
of such rescinded options against the refund by the Grantor of the exercise
price therefor.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above written.
GENERAL DATACOMM INDUSTRIES, INC.
By:
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Charles P. Johnson, Chairman of the Board
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First/Middle/Last Name
Total Shares:
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