DYADIC INTERNATIONAL, INC.
2001 EQUITY COMPENSATION PLAN
STOCK OPTION GRANT AGREEMENT
This STOCK OPTION GRANT AGREEMENT (this "AGREEMENT"), dated as of the
31st day of January, 2005 (the "DATE OF GRANT"), is delivered by Dyadic
International, Inc. (the "COMPANY") to Wayne Moor (the "GRANTEE").
RECITALS
A. Concurrently with the execution and delivery of this Agreement, the
Grantee has entered into an employment agreement with the Company dated of even
date herewith (as may be amended, restated or otherwise modified, the
"EMPLOYMENT AGREEMENT"), pursuant to which the Grantee will serve as a Vice
President and the Chief Financial Officer of the Company.
B. The Dyadic International, Inc. 2001 Equity Compensation Plan (as may
be amended, restated or otherwise modified, the "PLAN") provides for the grant
of options to purchase shares of common stock of the Company. A copy of the Plan
has heretofore been furnished to the Grantee, receipt of which is hereby
expressly acknowledged. Capitalized terms used but not otherwise defined herein
shall have the meanings given such terms in the Plan.
C. As contemplated in Section 1(a) of the Plan, the Board of Directors
of the Company has appointed a committee (the "COMMITTEE") to administer the
Plan.
D. To induce the Grantee to enter into the Employment Agreement and
continue to perform the obligations specified therein and promote the best
interests of the Company, the Committee has decided to Grant an Option to the
Grantee under the Plan to purchase shares of Company Stock ("SHARES").
AGREEMENT:
NOW, THEREFORE, the parties to this Agreement, intending to be legally
bound hereby, agree as follows:
1. Grant of Option. Subject to the terms and conditions set forth in this
Agreement and in the Plan, the Company hereby grants to the Grantee an Option to
purchase 277,889 Shares at an exercise price of $3.68 per Share (which is the
Fair Market Value on the date of Grant, being equal to the mean of the final
"asked" and "bid" prices of the Shares on the date hereof, as fixed by the terms
of the Plan). The Option shall become exercisable in accordance with the terms
of Paragraph 2 below. In accordance with Section 5(g) of the Plan, the Option
shall be treated as an Incentive Stock Option except to the extent that the
aggregate Fair Market Value of the Shares as of the date of the grant with
respect to which Incentive Stock Option is for the first time by the Grantee
during any calendar year under the Plan exceeds $100,000, then the Option, as to
such excess, shall be treated as a Nonqualified Stock Option.
2. Exercisability of Option. The number of Shares in respect of which the
Grantee shall be permitted to exercise the Option shall be determined by
reference to the dates (each a "VESTING DATE") fixed in the table set forth
below, provided that: (a) exercisability of Shares is cumulative; and (b) there
must not have occurred a termination of the Grantee's employment with the
Company (the "EMPLOYMENT RELATIONSHIP") for any reason whatsoever (the date of
such termination being hereinafter referred to as the "TERMINATION DATE") prior
to a Vesting Date in order for the Option to be exercisable in respect of the
Shares indicated opposite that Vesting Date:
Vesting Date Additional Shares for Which the Option is Exercisable
------------ -----------------------------------------------------
January 31, 2006 69,472.29
January 31, 2007 69,472.29
January 31, 2008 69,472.29
January 31, 2009 69,472.29
3. Term of Option.
(a) The Option shall be exercisable for a term commencing with the Date
of Grant and ending on the earlier of (i) January 31, 2010 or (ii) the
termination of the Plan, unless the Option is terminated at an earlier date in
accordance with the provisions of this Agreement or the Plan.
(b) Any portion of the Option that is not exercisable on the
Termination Date shall terminate on that date.
(c) The Option, to the extent exercisable, shall automatically
terminate upon the earlier of (x) the expiration of the period fixed in
Paragraph 3(a), above, or (y) the first to occur of any of the following events:
(i) Subject to clause (v) below, the expiration of the 90 day
period following the Termination Date, if the termination is for any
reason other than the Disability of the Grantee, his death or for
Cause.
(ii) Subject to clause (v) below, the expiration of the one
(1) year period after the Termination Date, to the extent the Option is
then unvested, if the termination of the Employment Relationship was on
account of the Grantee's Disability.
(iii) The expiration of the one (1) year period after the
Termination Date, if the reason for the termination of the Employment
Relationship was on account of the Grantee's death.
(iv) The Termination Date, if the termination of the
Employment Relationship was for Cause.
(v) The provisions of clauses (i) and (ii) above to the
contrary notwithstanding, if the Grantee engages in conduct that
constitutes Cause after the Termination Date, the Option shall
immediately terminate to the extent then unexercised (regardless of
vesting).
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(d) In accordance with Section 5(e)(ii) of the Plan, if the provisions
of either clause (iv) or clause (v) of Paragraph 3(c) applied to the termination
of the Option, the Grantee shall automatically forfeit all Shares underlying any
exercised portion of the Option for with the Company has not yet delivered the
share certificates, upon refund by the Company of the exercise price paid by the
Grantee for such Shares.
4. Exercise Procedures.
(a) Subject to the provisions of Paragraphs 2 and 3 above, the Grantee
may exercise part or all of the exercisable portion of the Option by giving the
Committee written notice of intent to exercise in the manner provided in this
Agreement, specifying the number of Shares as to which the Option is to be
exercised. On the delivery date, the Grantee shall pay the exercise price (i) in
cash, (ii) with the approval of the Committee, by delivering Shares of the
Company which shall be valued at their fair market value on the date of delivery
(such valuation to be determined in the manner fixed in the Plan), (iii) payment
through a broker in accordance with procedures permitted by Regulation T of the
Federal Reserve Board or (iv) by such other method as the Committee may approve,
provided that the Committee may, in its absolute discretion, impose from time to
time such limitations as it deems appropriate on the use of Shares of the
Company to exercise the Option.
(b) The obligation of the Company to deliver Shares upon exercise of
the Option shall be subject to all applicable laws, rules, and regulations and
such approvals by governmental agencies as may be deemed appropriate by the
Committee, including such actions as Company counsel shall deem necessary or
appropriate to comply with relevant securities laws and regulations. The Company
may require that the Grantee (or other person exercising the Option after the
Grantee's death) represent that the Grantee is purchasing Shares for the
Grantee's own account and not with a view to or for sale in connection with any
distribution of the Shares, or such other representation as the Committee deems
appropriate. All obligations of the Company under this Agreement shall be
subject to the rights of the Company as set forth in the Plan to withhold
amounts required to be withheld for any taxes, if applicable. Subject to
Committee approval, in its absolute discretion, the Grantee may elect to satisfy
any income tax withholding obligation of the Company with respect to the Option
by having Shares withheld up to an amount that does not exceed the minimum
applicable withholding tax rate for federal (including FICA), state and local
tax liabilities.
5. Restrictions on Transfer of Shares. In addition to the restrictions imposed
by the Plan on the transferability of the Shares acquired by an the Grantee's
exercise of the Option granted hereby, without the prior consent of the Company,
for so long as the Company is not a "Reporting Company" within the meaning of
the Exchange Act of 1934, as amended, the Grantee shall make no transfer of the
Shares (a) for a period of five (5) years following the date of this Agreement
and (b) thereafter, to any competitor of the Company.
6. Change of Control. The provisions of the Plan applicable to a Change of
Control shall apply to the Option, and, in the event of a Change of Control, the
Committee may take such actions as it deems appropriate pursuant to the Plan.
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7. Restrictions on Exercise. Only the Grantee may exercise the Option during the
Grantee's lifetime and, after the Grantee's death, the Option shall be
exercisable (subject to the limitations specified in the Plan) solely by the
legal representatives of the Grantee, or by the person who acquires the right to
exercise the Option by will or by the laws of descent and distribution, to the
extent that the Option is exercisable pursuant to this Agreement.
8. Grant Subject to Plan Provisions. This grant is made pursuant to the Plan,
the terms of which are incorporated herein by reference, and in all respects
shall be interpreted in accordance with the Plan. The grant and exercise of the
Option are subject to the provisions of the Plan and to interpretations,
regulations and determinations concerning the Plan established from time to time
by the Committee in accordance with the provisions of the Plan, including, but
not limited to, provisions pertaining to (i) rights and obligations with respect
to withholding taxes, (ii) the registration, qualification or listing of the
Shares, (iii) changes in capitalization of the Company and (iv) other
requirements of applicable law. The Committee shall have the authority to
interpret and construe the Option pursuant to the terms of the Plan, and its
decisions shall be conclusive as to any questions arising hereunder.
9. No Employment or Other Rights. The grant of the Option shall not confer upon
the Grantee any right to be retained by or in the employ or service of the
Company and shall not interfere in any way with the right of the Company to
terminate the Grantee's employment or service at any time. The right of the
Company to terminate at will the Grantee's employment or service at any time for
any reason is specifically reserved.
10. No Shareholder Rights. Neither the Grantee, nor any person entitled to
exercise the Grantee's rights in the event of the Grantee's death, shall have
any of the rights and privileges of a shareholder with respect to the Shares
subject to the Option, until certificates for Shares have been issued upon the
exercise of the Option.
11. Assignment and Transfers. The rights and interests of the Grantee under this
Agreement may not be sold, assigned, encumbered or otherwise transferred except,
in the event of the death of the Grantee, by will or by the laws of descent and
distribution. In the event of any attempt by the Grantee to alienate, assign,
pledge, hypothecate, or otherwise dispose of the Option or any right hereunder,
except as provided for in this Agreement, or in the event of the levy or any
attachment, execution or similar process upon the rights or interests hereby
conferred, the Company may terminate the Option by notice to the Grantee, and
the Option and all rights hereunder shall thereupon become null and void. The
rights and protections of the Company hereunder shall extend to any successors
or assigns of the Company and to the Company's parents, subsidiaries, and
affiliates. This Agreement may be assigned by the Company without the Grantee's
consent.
12. Applicable Law. The validity, construction, interpretation and effect of
this instrument shall be governed by and construed in accordance with the laws
of the State of Florida, without giving effect to the conflicts of laws
provisions thereof.
13. Notice. Any notice to the Company provided for in this instrument shall be
addressed to the Company in care of the Chief Executive Officer at the Company's
principal executive offices, and any notice to the Grantee shall be addressed to
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such Grantee at the current address shown on the payroll of the Company, or to
such other address as the Grantee may designate to the Company in writing. Any
notice shall be delivered by hand, sent by telecopy or enclosed in a properly
sealed envelope addressed as stated above, registered and deposited, postage
prepaid, in a post office regularly maintained by the United States Postal
Service.
14. Counterparts. This Agreement may be signed in any number of counterparts and
by facsimile signature, each of which shall be deemed to be an original, and all
of which taken together shall be deemed to be one and the same instrument.
15. Complete Understanding. This Agreement, together with the Plan, contains the
entire agreement of the parties relating to the subject matter hereof and
supersedes all prior agreements and understanding with respect to such subject
matter, and the parties hereto have made no agreements, representations or
warranties relating to the subject matter of this Agreement which are not set
forth herein, provided that the Parties are parties to the Employment Agreement.
Nothing contained in this Agreement shall be construed to limit or affect in any
manner or to any extent the restrictions or prohibitions that are applicable to
the Grantee under the Employment Agreement or the duration thereof. Similarly,
except as expressly provided otherwise in this Agreement, nothing contained in
the Employment Agreement shall be construed to limit or affect in any manner or
to any extent the restrictions or prohibitions that are applicable to the
Grantee under this Agreement.
[Signature Page Follows]
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IN WITNESS WHEREOF, the Company has caused a duly authorized officer to
execute this Agreement, and the Grantee has executed this Agreement, effective
as of the Date of Grant.
THE COMPANY: GRANTEE:
DYADIC INTERNATIONAL, INC.
By: /s/ Mark A. Emalfarb Accepted: /s/ Wayne Moor
-------------------------- --------------------------
President Wayne Moor
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