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EXHIBIT 99.2
FORM OF STOCK OPTION AGREEMENT UNDER
BRIGHTSTAR INFORMATION TECHNOLOGY GROUP, INC.
2000 LONG-TERM INCENTIVE PLAN
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INCENTIVE STOCK OPTION AGREEMENT
THIS AGREEMENT made effective as of [DATE], between BrightStar
Information Technology Group, Inc., a Delaware corporation (the "Company"), and
[NAME] the "Option Holder") relating to an option to purchase shares of the
Company's common stock, par value $.001 per share ("Common Stock").
1. Grant of Option. Subject to the terms and conditions of this
Agreement and the Company's 2000 Long-Term Incentive Plan (the "Plan"), the
Company hereby grants to the Option Holder effective as of [DATE], (the "Grant
Date") an option (the "Option") to purchase [TOTAL NUMBER OF SHARES] shares of
Common Stock. The Option shall be exercisable, in whole or in part as to any
vested portion thereof, for NUMBER OF SHARES] at an exercise price of (the
"Option Price") per share. The Option shall be exercisable in increments ratably
as set forth in Exhibit A hereto (the "Vesting Schedule") determined by the
number of full years of employment with BrightStar Information Technology Group,
Inc., a Delaware corporation and a wholly owned subsidiary of the Company, the
Company or any of its other wholly-owned subsidiaries (collectively, the
"Employer"), from the date of grant to the date of exercise. Notwithstanding
anything in this Agreement to the contrary, the Vesting Schedule is subject to
Section 4 herein and the Board of Directors, in its sole discretion, may waive
the Vesting Schedule and, upon written notice to the Option Holder, accelerate
the earliest date or dates in which any of the Options granted hereunder are
exercisable. This Agreement and the purchase of the shares of Common Stock
hereunder is intended and should be interpreted to qualify as an Incentive Stock
Option as that term is used in Section 422 of the Internal Revenue Code of 1986,
as it may be amended from time to time (the "Internal Revenue Code"), and any
provisions of this Agreement are hereby amended in their entirety to any extent
necessary to permit all Common Stock purchased hereunder to qualify for
treatment as such under Section 422 of the Internal Revenue Code.
2. Method for Exercising the Option. The vested portion of the Option
may be exercised in whole or in part only by delivery in person or through
certified or registered mail to the Company at its principal office in
Pleasanton, California (attention: Corporate Secretary) of written notice
specifying the Option that is being exercised and the number of shares of Common
Stock with respect to which the Option is being exercised. The notice must be
accompanied by payment of the total Option Price.
The total Option Price for the Common Stock to be acquired pursuant to
the Option shall be paid in full by any of the following methods or any
combination of the following methods:
(a) In cash or by certified or cashier's check payable to the
order of BrightStar Information Technology Group, Inc.;
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(b) The delivery to the Company of certificates representing
the number of shares of Common Stock then owned by the Option Holder,
the Designated Value (defined below) of which equals the Option Price
of the Common Stock purchased pursuant to the Option, properly endorsed
for transfer to the Company' provided, however, that no Option may be
exercised by delivery to the Company of certificates representing
Common Stock, unless such Common Stock has been held by the Option
Holder for more than six months. (For purposes of this Agreement, the
Designated Value of any shares of Common Stock delivered in payment of
the Option Price upon exercise of the Option shall be the Designated
Value as of the exercise date, and the exercise date shall be the day
of delivery of the certificates for the Common Stock used as payment of
the Option Price);
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(c) By delivery to the Company of a properly executed notice
of exercise together with irrevocable instructions to a broker to
deliver promptly to the Company, in payment of the Option Price, the
amount of the cash proceeds of the sale of shares of Common Stock or a
loan from the broker to the Option Holder sufficient, in each case, to
pay the Option Price, and in a form satisfactory to the Corporate
Secretary; or
(d) By delivery to the Company of sufficient Options, properly
endorsed for transfer to the Company, having a value sufficient to pay
the Option Price with respect to the other Options that are to be
exercised under this Agreement. The value of each Option to be
surrendered in payment of the Option Price shall be determined by
subtracting the Option Price from the Designated Value as of the date
of receipt of notice of the exercise of the Options by the Corporate
Secretary of the Company.
Upon such notice to the Corporate Secretary and payment of the
total Option Price, the exercise of the Option shall be deemed to be
effective, and a properly executed certificate or certificates
representing the Common Stock so purchased shall be issued by the
Company and delivered to the Option Holder.
For purposes of this Agreement, the "Designated Value" of the shares
of Common Stock on a given date shall mean (i) if the Common Stock is
listed or admitted for trading on any national securities exchange or
the National Market System of the National Association of Securities
Dealers, Inc. Automated Quotation System, the last sale price, or if no
sale occurred, the mean between the closing high bid and low asked
quotations for such date of the Common Stock on the principal
securities exchange on which shares of Common Stock are listed, (ii) if
Common Stock is not traded on any national securities exchange but is
quoted on the National Association of Securities Dealers, Inc.
Automated Operations System, or any similar system of automated
dissemination of quotations or securities prices in common use, the
mean between the closing high bid and low asked quotations for such day
of the Common Stock on such system, (iii) if neither clause (i) nor
(ii) is applicable, the mean between the high bid and low asked
quotations for the Common Stock as reported by the National Quotation
Bureau Incorporated if at least two securities dealers have inserted
both bid and asked quotation for shares of the Common Stock on at least
five (5) of the ten (10) preceding days, or (iv) if none of the
conditions set forth above is met, the fair market value of shares of
Common Stock as determined by the Board. Provided, for determining
"fair market value" of the Common Stock of the Company, such value
shall be determined without regard to any restriction other than a
restriction which will never lapse. In no event shall the fair market
value of the Common Stock be less than its par value.
3. Adjustment of the Option.
(a) Adjustment by Stock Split, Stock Dividend, Etc. If at any
time the Company increases or decreases the number of its outstanding
shares of Common Stock, or changes in any way the right and privileges
of its Common Stock, by means of the payment of a stock dividend or the
making of any other distribution on such shares payable in Common
Stock, or through a stock split or subdivision of shares of Common
Stock, or a consolidation
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or combination of shares of Common Stock, or through a reclassification
or recapitalization involving the Common Stock, the numbers, rights and
privileges of the shares of Common Stock included in the Option shall
be increased, decreased or changed in like manner as if such shares of
Common Stock had been issued and outstanding, fully paid and
non-assessable at the time of such occurrence.
(b) Dividends Payable in Stock of Another Corporation, Etc. If
at any time the Company pays or makes any dividend or other
distribution upon its Common Stock payable in securities or other
property (except money or Common Stock), a proportionate part of such
securities or other property shall be set aside and delivered to the
Option Holder upon issuance of the Common Stock purchased at the time
of exercise of the Option. The securities and other property delivered
to the Option Holder upon exercise of the Option shall be in the same
ratio to the total securities and property set aside for the Option
Holder as the number of shares of Common Stock with respect to which
the Option is then exercised is to the total shares of Common Stock
subject to the Option. Prior to the time that any such securities or
other property are delivered to the Option Holder in accordance with
the foregoing, the Company shall be the owner of such securities or
other property and Option Holder shall not have the right to vote the
securities, receive any dividends payable on such securities, or in any
other respect be treated as the owner. If securities or other property
which have been set aside by the Company in accordance with the Section
3 are not delivered to the Option Holder because the Option is not
exercised, then such securities or other property shall remain the
property of the Company and shall be dealt with by the Company as it
shall determine it its sole discretion.
(c) Other Changes in Stock. In the event there shall be any
change, other than as specified in the preceding subsections 3(a) and
(b), in the number or kind of outstanding shares of Common Stock or of
any stock or other securities into which the Common Stock shall be
changed or for which it shall have been exchanged, then and if the
Board of Directors of the Company shall in its discretion determine
that such change equitably requires an adjustment in the number or kind
of shares subject to the Option, such adjustments shall be made by the
Board of Directors and shall be effective for all purposes of this
Agreement.
(d) Apportionment of Option Price. Upon any occurrence
described in the preceding subsections 3(a), (b), and (c), the
aggregate Option Price for the shares of Common Stock then subject to
the Option shall remain unchanged and shall be apportioned ratably over
the increased or decreased number of changed kinds of securities or
other properties subject to the Option.
4. Change of Control; Corporate Transactions.
(a) If the Company recapitalizes or otherwise changes its
capital structure, or merges, consolidates, sells all of its assets or
dissolves and such transaction is not a Change of Control, then upon
any exercise of the Option hereunder, the Optionee shall be entitled to
purchase under the Option, in lieu of the number of shares of Common
Stock covered by this Option then exercisable, the number and class of
shares and
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securities to which the Optionee would have been entitled pursuant to the terms
of the agreement of merger, consolidation, sale of assets or dissolution, if,
immediately prior to such agreement of merger, consolidation, sale of assets or
dissolution, the Optionee had been the holder of record of the number of shares
of Common Stock as to which the Option is then exercisable.
5. Expiration and Termination of the Option. The Option shall expire at
5:00 p.m. Pacific Standard Time, time on the tenth anniversary of the Grant Date
(the period from the date of this Agreement to the expiration date is defined as
the "Option Period") or prior to such time as follows:
(a) Upon termination of the employment of the Option Holder with the
Employer for any reason other than death, the Options exercisable as of the date
of termination may be exercised by Option Holder within twelve months after the
date of the termination of employment of the Option Holder with the Employer
(provided such Options are exercised prior to their expiration date).
(b) Upon termination of the employment of the Option Holder with the
Employer by reason of the death of the Option Holder, the Options exercisable as
of the date of the Option Holder's death may be exercised by the Option Holder's
estate or by the person who acquired the right to exercise the Option by bequest
or inheritance. Such Options shall not be exercisable after the date they expire
or more than twelve months from the date of the Option Holder's death, whichever
first occurs.
6. Transferability. The Option may not be transferred except by will or
pursuant to the laws of descent and distribution, and it shall be exercisable
during the Option Holder's life only by him, or in the event of his disability
or incapacity, by his personal representative, and after his death, only by his
estate or by the person who acquired the right to exercise the Option by bequest
or inheritance.
7. Compliance with Securities Laws. Upon the acquisition of any shares
pursuant to the exercise of the Option herein granted, Option holder or any
person acting under Section 5(b) will enter into such written representations,
warranties and agreements as the Company may reasonably request in order to
comply with applicable securities laws or with this Agreement.
8. Legends on Certificates. The Certificates representing the shares of
Common Stock purchased by exercise of an Option will be stamped or otherwise
imprinted with legends in such form as the Company or its counsel may require
with respect to any applicable restrictions on sale or transfer and the stock
transfer records of the Company will reflect stop-transfer instructions with
respect to such shares.
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9. Withholding.
(a) Arrangement for Withholding. The Option Holder hereby agrees to
make appropriate arrangements with the Employer to provide for the amount of
additional tax withholding under Sections 3102 and 3402 of the Internal Revenue
Code and applicable state income tax laws resulting from the exercise of the
Option. If such arrangements are not made, the Company may refuse to issue any
Common Stock to the Option Holder.
(b) Withholding Election. The Option Holder may elect to pay all
such amounts of tax withholding, or any part thereof, by electing to transfer to
the Employer, or to have the Company withhold from shares otherwise issuable to
the Option Holder, shares of Common Stock having a value equal to the amount
required to be withheld or such lesser amount as may be elected by the Option
Holder. All elections shall be subject to the approval or disapproval of the
Board of Directors. The value of shares of Common Stock to be withheld shall be
based on the Designated Value of Common Stock on the date that the amount of tax
to be withheld is to be determined (the "Tax Date"). Any such election by the
Option Holder to have shares of Common Stock withheld for this purpose will be
subject to the following restrictions:
(i) All elections must be made prior to the Tax Date.
(ii) All elections shall be irrevocable.
(iii) If the Option Holder is an officer or director of the
Company within the meaning of Section 16 of the Securities Exchange Act of 1934,
as amended, ("Section 16"), the Option Holder must satisfy the requirements of
such Section 16 and any applicable rules thereunder with respect to the use of
Common Stock as consideration to satisfy such tax withholding obligation.
10. Miscellaneous.
(a) Notices. Any notice required or permitted to be given under
this Agreement shall be in writing and shall be given by first class registered
or certified mail, postage prepaid, or by personal delivery to the appropriate
party, addressed:
(i) If to the Company, to the Company at its principal place of
business (as of the date hereof, ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, telephone (▇▇▇) ▇▇▇-▇▇▇▇ (Attention: Corporate Secretary) or
at such other address as may have been furnished to the Option Holder in writing
by the Company; or
(ii) If to the Option Holder, to the Option Holder at his
address on file with the Company or at such other address as may have been
furnished to the Company by the Option Holder.
Any such notice shall be deemed to have been given as of the
fourth day after deposit in the United States Postal Service, postage prepaid,
property addressed as set
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forth above, in the case of mailed notice, or as of the date delivered in the
case of personal delivery.
(b) Amendment. The Board of Directors may make any adjustment in
the Option Price, the number of shares of Common Stock subject to, or the terms
of the Option by amendment or by substitution of an outstanding Option. Such
amendment or substitution may result in terms and conditions (including Option
Price, the number of shares of Common Stock covered, Vesting Schedule or Option
Period) that differ from the terms and conditions of this Option. The Board of
Directors may not, however, adversely affect the rights of the Option Holder
without the consent of the Option Holder. If such action is effective by
amendment, the effective date of such amendment will be the date of the original
grant of this Option. Except as provided herein, this Agreement may not be
amended or otherwise modified unless evidenced in writing and signed by the
Company and the Option Holder.
(c) Severability. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, and each other provision of this
Agreement shall be severable and enforceable to the extent permitted by law.
(d) Waiver. Any provision contained in this Agreement may be
waived, either generally or in any particular instance, by the Company.
(e) Binding Effect. This Agreement shall be binding upon and inure
to the benefit of the Company and the Option Holder and their respective heirs,
executors, administrators, legal representatives, successors and assigns.
(f) Rights to Employment. Nothing contained in this Agreement shall
be constructed as giving the Option Holder any right to be retained in the
employ of the Employer and this Agreement is limited solely to governing the
rights and obligations of the Option Holder with respect to the Common Stock and
the Option.
(g) Gender and Number. Except when otherwise indicated by the
context, the masculine gender shall also include the feminine gender, and the
definition of any term herein in the singular shall also include the plural.
(h) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware without giving
effect to the conflicts of laws provisions thereof.
[SIGNATURES ON THE FOLLOWING PAGE]
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IN WITNESS WHEROF, the parties have executed this Agreement as of the
day and year first above written.
BRIGHTSTAR INFORMATION TECHNOLOGY
GROUP, INC.
By:
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Compensation Committee
OPTION HOLDER
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[NAME]
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EXHIBIT A
Vesting Schedule
CONDITIONS TO VESTING AMOUNT EXERCISABLE
Upon the continuous employment Cumulative portion of the Option
of Option Holder by Employer that can be exercised after
through the applicable date satisfaction of the respective
indicated below: conditions to vesting
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July 1, 2001 100 percent