EXHIBIT 10.2
SMITHWAY MOTOR XPRESS CORP.
2005 OMNIBUS STOCK PLAN
INCENTIVE STOCK OPTION AGREEMENT
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Name of Optionee:
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No. of Shares Covered: Date of Grant:
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Exercise Price Per Share: Expiration Date:
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Exercise Schedule (Cumulative):
Date(s) of No. of Shares as to Which
Exercisability Option Becomes Exercisable
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This is an Incentive Stock Option Agreement (the "Agreement") between
Smithway Motor Xpress Corp., a Nevada corporation (the "Company"), and the
optionee identified above (the "Optionee") effective as of the date of grant
specified above.
RECITALS
WHEREAS, the Company maintains the Smithway Motor Xpress Corp. 2005
Omnibus Stock Plan (the "Plan");
WHEREAS, pursuant to the Plan, the Board of Directors of the Company (the
"Board") or a committee of two or more directors of the Company (the
"Committee") appointed by the Board administers the Plan and has the authority
to determine the awards to be granted under the Plan (if the Board has not
appointed a committee to administer the Plan, then the Board shall constitute
the Committee); and
WHEREAS, the Committee has determined that the Optionee is eligible to
receive an award under the Plan in the form of an incentive stock option (the
"Option");
NOW, THEREFORE, the Company hereby grants this Option to the Optionee
under the terms and conditions as follows.
TERMS AND CONDITIONS*
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* Unless the context indicates otherwise, terms that are not defined in this
Agreement shall have the meaning set forth in the Plan as it currently exists or
as it is amended in the future.
1. GRANT. The Optionee is granted this Option to purchase the number of
Shares specified at the beginning of this Agreement.
2. EXERCISE PRICE. The price to the Optionee of each Share subject to this
Option shall be the exercise price specified at the beginning of this
Agreement (which price shall not be less than the Fair Market Value as of
the date of grant or, if the Optionee owns or is deemed to own stock
possessing more than 10% of the combined voting power of all classes of
stock of the Company, 110% of the Fair Market Value as of the date of
grant).
3. INCENTIVE STOCK OPTION. This Option is intended to be an "incentive stock
option" within the meaning of Section 422 of the Internal Revenue Code of
1986, as amended (the "Code").
4. EXERCISE SCHEDULE. This Option shall vest and become exercisable as to the
number of Shares and on the dates specified in the exercise schedule at
the beginning of this Agreement. The exercise schedule shall be
cumulative; thus, to the extent this Option has not already been exercised
and has not expired, terminated or been cancelled, the Optionee or the
person otherwise entitled to exercise this Option as provided herein may
at any time, and from time to time, purchase all or any portion of the
Shares then purchasable under the exercise schedule.
This Option may also be exercised in full (notwithstanding the exercise
schedule) under the circumstances described in Section 8 of this Agreement
if it has not expired prior thereto.
5. EXPIRATION. This Option shall expire at 5:00 p.m. Central Time on the
earliest of:
(a) The expiration date specified at the beginning of this Agreement
(which date shall not be later than ten years after the date of
grant or, if the Optionee owns or is deemed to own stock possessing
more than 10% of the combined voting power of all classes of stock
of the Company, five years after the date of grant);
(b) The expiration of the period after the termination of employment of
the Optionee within which the Option can be exercised (as specified
in Section 7 of this Agreement), provided that the Committee may
extend any such period following the termination of employment
during which the Option can be exercised;
(c) Termination of the Optionee's employment for Cause. "Cause" shall be
deemed to exist upon (i) an act or acts of dishonesty undertaken by
Optionee and intended to result in substantial gain or personal
enrichment of Optionee at the expense of the Company; (ii) unlawful
conduct or gross misconduct that is willful and deliberate on
Optionee's part and that, in either event, is materially injurious
to the Company; (iii) the conviction of Optionee of a felony; or
(iv) material breach by Optionee of any terms and conditions of any
employment or non-competition/non-solicitation agreement between the
Optionee and the Company not caused by the Company, which breach has
not been cured by Optionee within ten days after written notice
thereof to Optionee from the Company; or
(d) The date (if any) fixed for cancellation pursuant to Section 17 of
the Plan.
In no event may anyone exercise this Option, in whole or in part, after it
has expired, notwithstanding any other provision of this Agreement.
6. PROCEDURE TO EXERCISE OPTION.
Notice of Exercise. This Option may be exercised by delivering written
notice of exercise to the Company at the principal executive office of the
Company, to the attention of the Company's Treasurer, in the form attached
to this Agreement. The notice shall state the number of Shares to be
purchased, and shall be signed by the person exercising this Option. If
the person exercising this
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Option is not the Optionee, he/she also must submit appropriate proof of
his/her right to exercise this Option.
Tender of Payment. Upon giving notice of any exercise hereunder, the
Optionee shall provide for payment of the purchase price of the Shares
being purchased through one or a combination of the following methods:
(a) Cash (including check, bank draft or money order);
(b) To the extent permitted by law, through a broker-assisted cashless
exercise in which the Optionee simultaneously exercises the Option
and sells all or a portion of the Shares thereby acquired pursuant
to a brokerage or similar relationship and uses the proceeds from
such sale to pay the purchase price of such Shares;
(c) By delivery to the Company of unencumbered Shares having an
aggregate Fair Market Value on the date of exercise equal to the
purchase price of such Shares; or
(d) By authorizing the Company to retain, from the total number of
Shares as to which the Option is exercised, that number of Shares
having a Fair Market Value on the date of exercise equal to the
purchase price for the total number of Shares as to which the Option
is exercised.
Notwithstanding the foregoing, the Optionee shall not be permitted to pay
any portion of the purchase price with Shares, or by authorizing the
Company to retain Shares upon exercise of the Option, if the Committee, in
its sole discretion, determines that payment in such manner is
undesirable.
Delivery of Certificates. As soon as practicable after the Company
receives the notice and purchase price provided for above, it shall
deliver to the person exercising this Option, in the name of such person,
a certificate or certificates representing the Shares being purchased. The
Company shall pay any original issue or transfer taxes with respect to the
issue or transfer of the Shares and all fees and expenses incurred by it
in connection therewith. All Shares so issued shall be fully paid and
nonassessable. Notwithstanding anything to the contrary in this Agreement,
no certificate for Shares distributable under the Plan shall be issued and
delivered unless the issuance of such certificate complies with all
applicable legal requirements including, without limitation, compliance
with the provisions of applicable state securities laws, the Securities
Act of 1933, as amended (the "Securities Act") and the Exchange Act.
7. EMPLOYMENT REQUIREMENT. This Option may be exercised only while the
Optionee remains employed with the Company or a parent or subsidiary
thereof, and only if the Optionee has been continuously so employed since
the date of this Agreement; provided that:
(a) This Option may be exercised for three months following the day the
Optionee's employment by the Company ceases if such cessation of
employment is for a reason other than death or disability, but only
to the extent that it was exercisable immediately prior to
termination of employment, provided that if termination of the
Optionee's employment shall have been for Cause, the Option shall
expire, and all rights to purchase Shares hereunder shall terminate,
immediately upon such termination.
(b) This Option may be exercised within one year after the Optionee's
employment by the Company ceases if such cessation of employment is
because of death or disability of the Optionee, but only to the
extent it was exercisable immediately prior to cessation of
employment.
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(c) If the Optionee's employment terminates after a declaration made
pursuant to Section 17 of the Plan in connection with Fundamental
Change , the Option may be exercised at any time permitted by such
declaration.
Notwithstanding the above, the Option may not be exercised after it has
expired.
8. ACCELERATION OF VESTING.
In the event of a Fundamental Change the Committee may, but shall not be
obligated to:
(a) if the Fundamental Change is a merger or consolidation or statutory
share exchange, make appropriate provision for the protection of
this Option by the substitution for this Option of options or voting
common stock of the corporation surviving any merger or
consolidation or, if appropriate, the parent corporation of the
Company or such surviving corporation; or
(b) at least ten days before the occurrence of the Fundamental Change,
declare, and provide written notice to the Optionee of the
declaration, that this Option, whether or not then exercisable,
shall be canceled at the time of, or immediately before the
occurrence of, the Fundamental Change (unless it shall have been
exercised prior to the occurrence of the Fundamental Change). In
connection with any such declaration, the Committee may, but shall
not be obligated to, cause payment to be made to the Optionee of
cash equal to, for each Share covered by the canceled Option, the
amount, if any, by which the Fair Market Value per Share exceeds the
exercise price per Share covered by this Option. At the time of any
such declaration, this Option shall immediately become exercisable
in full and the Optionee shall have the right, during the period
preceding the time of cancellation of this Option, to exercise this
Option as to all or any part of the Shares covered by this Option.
In the event of a declaration pursuant to this subsection, to the
extent this Option has not been exercised prior to the Fundamental
Change, the unexercised part of this Option shall be canceled at the
time of, or immediately before, the Fundamental Change, as provided
in the declaration. Notwithstanding the foregoing, the holder of
this Option shall not be entitled to the payment provided for in
this subsection if this Option shall have expired pursuant to
Section 5 above or been cancelled. For purposes of this subsection
only, "Fair Market Value" per Share has the meaning set forth in
Section 17 of the Plan.
Discretionary Acceleration. Notwithstanding any other provisions of this
Agreement to the contrary, the Committee may, in its sole discretion,
declare at any time that the Option shall be immediately exercisable.
9. LIMITATION ON TRANSFER. During the lifetime of the Optionee, only the
Optionee or his/her guardian or legal representative may exercise the
Option. The Option may not be assigned or transferred by the Optionee
otherwise than by will or the laws of descent and distribution.
10. NO SHAREHOLDER RIGHTS BEFORE EXERCISE. No person shall have any of the
rights of a shareholder of the Company with respect to any Share subject
to the Option until the Share actually is issued to him/her upon exercise
of the Option.
11. LOCK-UP PERIOD.
(a) The Optionee agrees that the Optionee will not offer, pledge, sell,
contract to sell, sell any option, sell any contract to purchase,
purchase any option, purchase any contract to sell, grant any
option, right, or warrant to purchase, lend, or otherwise transfer
or dispose of, directly or indirectly, any Shares (or any other
Company securities) or enter into any swap, hedging, or other
arrangement that transfers to another, in whole or in part, any of
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the economic consequences of ownership of any Shares (or any other
Company securities) held by the Optionee (other than those included
in the registration) for a period specified by the representative of
the underwriters of Stock (or any other Company securities) not to
exceed 90 days (180 days in the case of an initial public offering)
after the effective date of any Company registration statement filed
under the Securities Act.
(b) The Optionee agrees to execute and deliver such other agreements as
may be reasonably requested by the Company or the underwriter to the
extent that such agreements are consistent with the foregoing or
that are necessary to give further effect to the provisions set
forth in Section 11(a). In addition, if requested by the Company or
the representative of the underwriters of Stock (or any other
Company securities), the Optionee will provide, within 10 days of
such request, such information as may be required by the Company or
such representative in connection with the completion of any public
offering of the Company's securities pursuant to a registration
statement filed under the Securities Act.
(c) The obligations described in this Section 11 will not apply to a
registration relating solely to employee benefit plans on Form S-8
or similar forms that may be promulgated in the future, or a
registration relating solely to a Commission Rule 145 transaction on
Form S-4 or similar forms that may be promulgated in the future. The
Company may impose stop-transfer instructions with respect to the
shares of Stock (or any other Company securities) subject to the
foregoing restriction until the end of such 90-day or 180-day
period, as applicable.
12. DISCRETIONARY ADJUSTMENT. In the event of any reorganization, merger,
consolidation, recapitalization, liquidation, reclassification, stock
dividend, stock split, combination of shares, rights offering, or
extraordinary dividend or divestiture (including a spin-off), or any other
change in the corporate structure or Shares of the Company, the Committee
(or if the Company does not survive any such transaction, a comparable
committee of the Board of Directors of the surviving corporation) may,
without the consent of the Optionee, make such adjustment as it determines
in its discretion to be appropriate as to the number and kind of
securities subject to and reserved under the Plan and, in order to prevent
dilution or enlargement of rights of the Optionee, the number and kind of
securities issuable upon exercise of the Option and the exercise price
hereof.
13. TRANSFER OF SHARES -- TAX EFFECTS. The Optionee hereby acknowledges that
if any Shares received pursuant to the exercise of any portion of the
Option are sold within two years from the date of grant or within one year
from the effective date of exercise of the Option, or if certain other
requirements of the Code are not satisfied, such Shares will be deemed
under the Code not to have been acquired by the Optionee pursuant to an
"incentive stock option" as defined in the Code; and that the Company
shall not be liable to the Optionee in the event the Option for any reason
is deemed not to be an "incentive stock option" within the meaning of the
Code.
14. INTERPRETATION OF THIS AGREEMENT. All decisions and interpretations made
by the Committee with regard to any question arising hereunder or under
the Plan shall be binding and conclusive upon the Company and the
Optionee. If there is any inconsistency between the provisions of this
Agreement and the Plan, the provisions of the Plan shall govern.
15. DISCONTINUANCE OF EMPLOYMENT. This Agreement shall not give the Optionee a
right to continued employment with the Company or any parent or subsidiary
of the Company, and the Company or any such parent or subsidiary employing
the Optionee may terminate his/her employment at any time and otherwise
deal with the Optionee without regard to the effect it may have upon
him/her under this Agreement.
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16. OPTION SUBJECT TO PLAN, ARTICLES OF INCORPORATION AND BY-LAWS. The
Optionee acknowledges that the Option and the exercise thereof is subject
to the Plan, the Articles of Incorporation, as amended from time to time,
and the By-Laws, as amended from time to time, of the Company, and any
applicable federal or state laws, rules or regulations.
17. OBLIGATION TO RESERVE SUFFICIENT SHARES. The Company shall at all times
during the term of the Option reserve and keep available a sufficient
number of Shares to satisfy this Agreement.
18. BINDING EFFECT. This Agreement shall be binding in all respects on the
heirs, representatives, successors and assigns of the Optionee.
19. CHOICE OF LAW. This Agreement is entered into under the laws of the State
of Iowa and shall be construed and interpreted thereunder (without regard
to its conflict of law principles).
IN WITNESS WHEREOF, the Optionee and the Company have executed this
Agreement as of the Date of Grant specified above.
OPTIONEE
__________________________________
SMITHWAY MOTOR XPRESS CORP.
By _______________________________
Its _____________________________
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__________________, 20__
Smithway Motor Xpress Corp.
2031 Quail Avenue
Fort Dodge, Iowa 50501
Ladies and Gentlemen:
I hereby exercise the following option (the "Option") granted to me under
the Smithway Motor Xpress Corp. 2005 Omnibus Stock Plan (the "Plan") with
respect to the number of shares of Common Stock of Smithway Motor Xpress Corp.
(the "Company") indicated below:
NAME: ___________________
DATE OF GRANT OF OPTION: ___________________
EXERCISE PRICE PER SHARE: ___________________
NUMBER OF SHARES WITH RESPECT TO WHICH
THE OPTION IS HEREBY EXERCISED: ___________________
TOTAL EXERCISE PRICE: ___________________
[ ] Enclosed with this letter is a check, bank draft or money
order in the amount of the Total Exercise Price.
[ ] I hereby agree to pay the Total Exercise Price within five
business days of the date hereof and, as stated in the
attached Broker's Letter, I have delivered irrevocable
instructions to _________________________________ to promptly
deliver to the Company the amount of sale or loan proceeds
from the Shares to be issued pursuant to this exercise
necessary to satisfy my obligation hereunder to pay the Total
Exercise Price.
[ ] Enclosed with this letter is a certificate evidencing
unencumbered Shares (duly endorsed in blank) having an
aggregate Fair Market Value (as defined in the Plan) equal to
or in excess of the Total Exercise Price.
[ ] I elect to pay the Total Exercise Price through a reduction in
the number of Shares delivered to me upon this exercise of the
Option as provided in Section 9 of the Plan.
If I am enclosing Shares with this letter, I hereby represent and warrant
that I am the owner of such Shares free and clear of all liens, security
interests and other restrictions or encumbrances. I agree that I will pay any
required withholding taxes in connection with this exercise.
Please issue a certificate (the "Certificate") for the number of Shares
with respect to which the Option is being exercised in the name of the person
indicated below and deliver the Certificate to the address indicated below:
NAME IN WHICH TO ISSUE CERTIFICATE: _______________________
ADDRESS TO WHICH CERTIFICATE SHOULD BE
DELIVERED: _______________________
_______________________
_______________________
_____________
PRINCIPAL MAILING ADDRESS FOR HOLDER OF THE
CERTIFICATE (IF DIFFERENT FROM ABOVE):
_______________________
_______________________
_______________________
_____________
Very truly yours,
____________________________
Signature
____________________________
Name, please print
____________________________
Social Security Number
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__________________, 20__
Smithway Motor Xpress Corp.
2031 Quail Avenue
Fort Dodge, Iowa 50501
Ladies and Gentlemen:
NAME OF OPTIONEE: _________________________
DATE OF GRANT OF OPTION: _________________________
EXERCISE PRICE PER SHARE: _________________________
NUMBER OF SHARES WITH RESPECT TO WHICH
THE OPTION IS TO BE EXERCISED: _________________________
TOTAL EXERCISE PRICE: _________________________
The above Optionee has requested that we finance the exercise of the above
Option to purchase Shares of Common Stock of Smithway Motor Xpress Corp. (the
"Company") and has given us irrevocable instructions to promptly deliver to the
Company the amount of sale or loan proceeds from the Shares to be issued
pursuant to such exercise to satisfy the Optionee's obligation to pay the Total
Exercise Price.
Very truly yours,
_________________________
Broker Name
By_______________________