Exhibit 99.5
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REFAC TECHNOLOGY DEVELOPMENT CORPORATION
1998 STOCK OPTION AND INCENTIVE PLAN
NONQUALIFIED STOCK OPTION AGREEMENT
NONQUALIFIED STOCK OPTION AGREEMENT (this "Agreement") entered into
as of _______, _____, pursuant to the REFAC Technology Development
Corporation 1998 Stock Option and Incentive Plan (the "Plan"), by and
between REFAC TECHNOLOGY DEVELOPMENT CORPORATION, a Delaware corporation,
("REFAC")and _____________ (the "Optionee"). Capitalized terms used but not
defined herein shall have the meanings ascribed to such terms in the Plan.
WHEREAS, REFAC desires, by affording the Optionee an opportunity to
purchase shares of its Stock as hereinafter provided and subject to the
terms and conditions hereof, to carry out the purpose of the Plan;
NOW, THEREFORE, in consideration of the mutual covenants
hereinafter set forth and for other good and valuable consideration, the
parties hereto have agreed and do hereby agree as follows:
1. Number of Shares. REFAC hereby grants to the Optionee an
option (the "Option") to purchase an aggregate of [ ] shares of
Stock, subject to adjustment as provided in Section 2 hereof, on the terms
and conditions herein set forth.
2. Adjustments. In the event that the Board shall determine
that any dividend or other distribution (whether in the form of cash, Stock
or other property), recapitalization, stock split, reverse stock split,
reorganization, merger, consolidation, spin-off, combination, repurchase,
or share exchange, or other similar corporate transaction or event, affects
the Stock such that an adjustment is appropriate in order to prevent
dilution or enlargement of the rights of the Optionee hereunder, then the
Committee shall make such equitable changes or adjustments as it deems
necessary or appropriate to any or all of (i) the number and kind of shares
of Stock which may thereafter be issued in connection with the Option, (ii)
the number and kind of shares of Stock issued or issuable in respect of the
Option, and (iii) the Exercise Price (as defined below) of the Option.
3. Option Price. The purchase price of the Stock subject to
the Option shall be $____ per share, subject to adjustment as provided in
Section 2 hereof.
4. Term and Exercisability of Option.
(a) Unless the Option is previously cancelled pursuant to this
Agreement, the Option Term shall commence on the date hereof (the "Date of
Grant") and terminate on the tenth anniversary of the Date of Grant. Upon
the termination of the Option, all rights of the Optionee hereunder shall
cease.
(b) Exercisability of Option. [TO COME]
5. Payment. Upon the exercise of all or any portion of the
Option, the exercise price of the shares being purchased (the "Exercise
Price") shall be paid in full either (a) in cash or by check, (b) by
tendering previously acquired shares of Stock having an aggregate fair
market value at the time of exercise equal to the total Exercise Price, (c)
by a combination of (a) and (b), or (d) through a broker cashless exercise
procedure, if such procedure has been established by the Company at the
time of exercise.
6. Termination of Employment.
(a) Except as provided in this Section 6, the Option may not be
exercised after the Optionee has ceased to be employed by the Company.
(b) If the Optionee's employment with the Company is terminated
by the Company for "Cause" (as defined below), the Option shall be
cancelled as of the date of such termination.
For purposes of this Agreement, "Cause" shall mean the occurrence
of any of the following, as reasonably determined by the Company:
(i) the willful and continued failure, in the reasonable
judgment of the Board, by the Optionee to perform substantially his
duties with the Company (other than any such failure resulting from his
death or Disability) after a written demand for substantial performance
is delivered to the Optionee by the Board which specifically identifies
the manner in which it is believed that the Optionee has not
substantially performed his duties;
(ii) the willful engaging by the Optionee in conduct which
in the reasonable opinion of the Board is materially and demonstrably
injurious to the Company or any of its parents, subsidiaries or
affiliates; or
(iii) the conviction of the Optionee (or the entering by
the Optionee of a plea of guilty or nolo contendere) for any felony or
any lesser crime which involved the Company or its property, or any of
the Company's parents, subsidiaries or affiliates or any such entity's
property.
Notwithstanding the foregoing, the Optionee will not be deemed to have been
terminated for Cause within the meaning of clause (i) or (ii) without (x)
reasonable notice to the Optionee setting forth the reasons for the
Company's intention to terminate for Cause, (y) an opportunity for the
Optionee, together with his counsel, to be heard before the Board, and (z)
delivery to the Optionee of a notice of termination from the Board finding
that, in the good faith opinion of the Board, clause (i) or (ii) hereof may
be invoked, and specifying the particulars thereof in detail.
(c) If the Optionee's employment with the Company is terminated
for any reason other than for Cause, the Optionee (or his beneficiary or
representative, as applicable) shall have the right to exercise the Option,
to the extent exercisable as of the date of such termination of employment
(i) in the case of a termination of employment because of the Optionee's
death or Disability (as defined below), for a period of one (1) year
following the date of such termination, and (ii) in the case of any other
termination of employment other than for Cause or as provided in clause
(i), for a period of thirty (30) days following the date of such
termination. For purposes of this Agreement, "Disability" shall be deemed
the reason for such termination if, as a result of the Optionee's
incapacity due to physical or mental illness, the Optionee shall have been
absent from the full-time performance of the Optionee's duties with the
Company for a period of one hundred twenty (120) consecutive days during
the Term, or a period or periods aggregating more than one hundred twenty
(120) days in any six (6) consecutive month period during the Term. The
Optionee agrees to submit to such medical examinations as may be necessary
to determine whether a Disability exists, pursuant to reasonable requests
which may be made by the Company from time to time.
(d) Notwithstanding anything to the contrary in this Section 6,
the Option shall not be exercisable later than the date of its termination
as set forth in Section 4(a) hereof.
(e) For purposes of this Section 6, the transfer of employment
of an Optionee between the Company and any one of its subsidiaries (or
between subsidiaries) shall not be deemed a termination of employment.
7. Rights of Optionee.
(a) The Optionee shall have none of the rights of a stockholder
with respect to the shares covered by the Option until the shares are
issued or transferred to such Optionee upon exercise of the Option.
(b) The Option shall not interfere with or limit in any way the
right of the Company to terminate any Optionee's employment at any time,
nor confer upon any Optionee any right to continue in the employ of the
Company or any subsidiary.
8. Nontransferability of Option. The Option shall not be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated,
other than (a) by will or by the laws of descent and distribution,
(b) through a gratuitous transfer by the Optionee to a member of his
immediate family or to a trust for the benefit of any such immediate family
member or members or (c) if then permitted by Rule 16b-3 under the Exchange
Act, pursuant to a Qualified Domestic Relations Order (as defined under the
Code or Title I of the Employee Retirement Income Security Act of 1974, as
amended).
9. Notification.
(a) The Option shall be exercised by written notification of
exercise substantially in the form of Exhibit A hereto and delivered to the
Secretary of REFAC in accordance with subsection (b) of this Section 9.
Such notification shall specify the number of shares of Stock to be
purchased and the manner in which payment is to be made.
(b) Any notification required or permitted hereunder shall be
addressed to REFAC, to the attention of the Secretary, 122 East 42nd
Street, New York, New York 10168 or to the Optionee at the address set
forth below, as the case may be, and deposited, postage prepaid, in the
United States mail; provided, however, that a notification of exercise
pursuant to subsection (a) of this Section 9 shall be effective only upon
receipt by the Secretary of REFAC of such notification and all necessary
documentation, including full payment for the shares. Either party may, by
notification to the other given in the manner aforesaid, change the address
for future notices.
10. Tax Withholding. The Company shall have the power and the
right to require an Optionee to remit to the Company an amount sufficient
to satisfy any Federal, state, local, employment and other taxes required
by law to be withheld as a result of any taxable event arising in
connection with the Option, in accordance with the terms of the Plan. The
Optionee may satisfy such withholding obligation by any of the following
methods, or by a combination of such methods: (a) tendering a cash
payment; (b) authorizing the Company to withhold from the shares of Stock
otherwise payable to the Optionee one or more of such shares having an
aggregate Fair Market Value, determined as of the date the withholding tax
obligation arises, less than or equal to the amount of the total
withholding tax obligation; or (c) delivering to the Company previously
acquired shares of Stock (none of which shares may be subject to any claim,
lien, security interest, community property right or other right of spouses
or present or former family members, pledge, option, voting agreement or
other restriction or encumbrance of any nature whatsoever) having an
aggregate Fair Market Value, determined as of the date the withholding tax
obligation arises, less than or equal to the amount of the total
withholding tax obligation.
11. Conditions to Issuance. The Option and exercise of the
Option, and the other obligations of the Company under the Plan and the
Option shall be subject to all applicable federal and state laws, rules and
regulations and to such approvals by any regulatory or governmental agency
as may be required. REFAC, in its discretion, may postpone the issuance or
delivery of Stock under the Option as REFAC may consider appropriate and
may require any Participant to make such representations and furnish such
information as it may consider appropriate in connection with the issuance
or delivery of Stock in compliance with applicable laws, rules and
regulations.
12. Potential Change in Control. Notwithstanding any other
provision of this Agreement, upon the occurrence of a Potential Change in
Control, the Option, to the extent outstanding at the time of such
Potential Change in Control, shall become immediately exercisable in full.
13. Incorporation of Plan; Governing Law; Interpretation.
(a) The Plan is hereby incorporated by reference and made a part
hereof, and the Option and this Agreement are subject to all terms and
conditions of the Plan. To the extent that any provision in this Agreement
is inconsistent with the Plan, the provisions of the Plan shall control.
(b) This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware.
(c) The Board shall have final authority to interpret and
construe the Plan and this Agreement and to make any and all determinations
under them, and its determination and decisions shall be final, conclusive
and binding upon the Optionee and his legal representative in respect of
any questions arising under the Plan or this Agreement.
14. Miscellaneous.
(a) This Agreement shall bind and inure to the benefit of the
Company, its successors and assigns, and the Optionee and his personal
representatives and assigns.
(b) The failure of the Company to enforce at any time any
provision of this Agreement shall in no way be construed to be a waiver of
such provision or of any other provision hereof.
15. Amendment. This Agreement may be amended or modified at any
time by an instrument in writing signed by the parties hereto.
IN WITNESS WHEREOF, the Company has caused this Agreement to be
duly executed by its duly authorized officer and the Optionee has hereunto
set his hand, all as of the day and year set forth above.
REFAC TECHNOLOGY DEVELOPMENT
CORPORATION
By _____________________________
Name:
Title:
ACCEPTED:
_________________________
Optionee Date
_________________________
_________________________
Address