Form of FPIC INSURANCE GROUP, INC. OMNIBUS INCENTIVE PLAN STOCK OPTION AGREEMENT
Form
Revised January 2007
Form
of
FPIC
INSURANCE GROUP, INC.
OMNIBUS
INCENTIVE PLAN STOCK OPTION AGREEMENT
THIS
AGREEMENT, made as of______, ____ is by and between FPIC Insurance Group, Inc.,
a Florida corporation (the “Company”), and ________ (the
“Optionee”).
WITNESSETH:
WHEREAS,
the Company maintains the Omnibus Incentive Plan (the “Plan”) for the benefit of
its officers and key employees and the officers and key employees of the
Subsidiaries; and
WHEREAS,
the Company wishes to grant to the Optionee Options under the Plan, on the
terms
and conditions set forth in the Plan and as hereinafter provided;
NOW,
THEREFORE, in consideration of the premises, it is agreed as
follows:
1. Definitions
Terms
used in this Agreement that are defined in the Plan shall have the same meaning
as set forth in the Plan.
As
used in this Agreement, “termination of employment” shall mean the Optionee’s
ceasing to be an employee of the Company or any of its Subsidiaries, whether
by
reason of voluntary or involuntary termination of employment, the Optionee’s
employer ceasing to be a Subsidiary of the Company, death, Permanent and Total
Disability, or otherwise.
2. Grant
of Options
The
Company hereby grants to Optionee _____ Options to purchase _____ Shares at
an
Option Price per Share of $_____. Of these Options, _____ will be Incentive
Stock Options pursuant to Section 422 of the Code, and _____ will be
Nonqualified Stock Options.
3. Stock
Option Terms and Exercise Period
a. Options
awarded under this Agreement may not be exercised by the Optionee at any time
until such Options are vested as provided in paragraph 4 of this
Agreement.
b. This
Agreement and the Options issued pursuant thereto shall terminate on the earlier
of (i) the tenth anniversary of the date of this Agreement, (ii) the date
such
Options
are fully exercised, or (iii) the date determined pursuant to Section 5 hereof
following the Optionee's termination of employment.
4. Vesting
Subject
to Section 10 hereof and the other provisions of this Section 4, one-third
(rounded up to a whole number) of the Options set forth in paragraph 2 shall
vest on the one year anniversary of the date of this Agreement, with an
additional one-third of the Options vesting on each of the next two
anniversaries of this Agreement, provided the Optionee has remained in the
employ of the Company or a Subsidiary thereof through the applicable vesting
date, such vesting maximizing Incentive Stock Options pursuant to Section 422
of
the Code, as follows:
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The
Optionee shall be 100% vested in all Options awarded under this Agreement (i)
if
the Optionee’s termination of employment from the Company and its Subsidiaries
is as a result of the death, Permanent and Total Disability (as that term is
defined in Code § 22(e)(3)), or retirement at or after age 65 of the Optionee
and/or (ii) as provided in the Optionee’s employment, severance or other
agreement (if applicable). The Optionee shall forfeit any unvested Options
(i)
upon termination of employment for any reason other than the death, Permanent
and Total Disability (as that term is defined in Code § 22(e)(3)) or retirement
at or after age 65 of the Optionee or (ii) except as otherwise provided in
the
Optionee’s employment, severance or other agreement (if
applicable).
5. Termination
of Employment
a. In
the event of the Optionee’s termination of employment, the Nonqualified Stock
Options hereunder that are vested as of the date of termination of employment
will terminate upon the earlier of (i) the full exercise of the Option, (ii)
the
tenth anniversary of the date of this Agreement, or (iii) three years following
the date of termination of employment, and the Incentive Stock Options hereunder
that are vested as of the date of termination of employment will terminate
upon
the earlier of (i) the full exercise of the Option, (ii) the tenth anniversary
of the date of this Agreement, or (iii) three months following the date of
termination of employment.
b. Notwithstanding
the above, in the event the employment of the Optionee is terminated as a result
of death or Permanent and Total Disability (as that term is defined in Code
§ 22
(e)(3)) prior to the termination of an Option, such Option may be exercised
to
the extent permitted under Section 7.4(c) of the Plan.
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c. Any
portion of the Options hereunder that is unvested on the date of termination
of
employment (and that do not become vested on the date of termination of
employment pursuant to Section 4 hereof), shall expire as of the date of
termination of employment.
6. Transferability
of Options
Except
as provided in the following sentence, this Agreement and the Options granted
hereunder shall not be transferable otherwise than by will or by the laws of
descent and distribution, and shall be exercised, during the lifetime of the
Optionee, only by the Optionee. Notwithstanding the preceding sentence, the
Nonqualified Stock Options granted hereunder may be transferred by the Optionee
during his or her lifetime to any member of his or her immediate family or
a
trust established for the exclusive benefit of one or more members of his or
her
immediate family or to a former spouse pursuant to a domestic relations order.
For purposes of this Section, the term “immediate family” is defined as the
Optionee’s spouse, children, stepchildren, grandchildren (including
relationships arising from legal adoption), and parents.
7. Exercise
of Options
a. Options
shall become exercisable at such time as may be provided herein and shall be
exercisable by written notice of such exercise, in the form prescribed by the
Committee, to the Secretary or President of the Company, at its principal
office. The notice shall specify the number of Options that are being
exercised.
b. Shares
purchased pursuant to this Agreement shall be paid for in full at the time
of
such purchase in cash, in Shares, including Shares acquired pursuant to the
Plan, or part in cash and part in Shares. Shares transferred in payment of
the
Option Price shall be valued as of the date of transfer based on Fair Market
Value. Subject to prior approval of the Company, and subject to such
restrictions or conditions as the Company may prescribe, Options may also be
exercised with the assistance of a broker.
c. The
Committee may establish rules regarding the types of Shares the Optionee may
transfer in payment of the Option Price in order to avoid adverse accounting
treatment.
8. Regulation
by the Committee
This
Agreement and the Options granted hereunder shall be subject to the
administrative procedures and rules as the Committee may adopt. All decisions
of
the Committee upon any question arising under the Plan or under this Agreement
shall be conclusive and binding upon the Optionee and any person or persons
to
whom Options hereunder have been transferred by will or by laws of descent
and
distribution.
9. Rights
as a Shareholder
The
Optionee shall have no rights as a Shareholder with respect to Options granted
hereunder until certificates for Shares of common stock are issued to the
Optionee.
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10. Change
in Control
a. Upon
a Change in Control, all Options granted hereunder shall automatically vest
as
of the date of such Change in Control and all restrictions or contingencies
will
be deemed to have been satisfied.
b. Upon
a Change in Control, the Options shall remain exercisable until the tenth
anniversary of this Agreement, notwithstanding any termination of employment
occurring prior thereto.
11. Plan
Terms
The terms of the Plan are incorporated herein by reference.
12. Governing
Law and Severability.
To the extent not preempted by Federal law, this Agreement will be governed
by
and construed in accordance with the laws of the State of Florida, without
regard to conflicts of law provisions. In the event any provision of this
Agreement shall be held illegal or invalid for any reason, the illegality or
invalidity shall not affect the remaining part of the Agreement, and the
Agreement shall be construed and enforced as if the illegal or invalid provision
had not been included.
13. Effective
Date of Grant
Each Option granted under this Agreement shall be effective as of the date
of
this Agreement written above.
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