EXHIBIT 99.5
INCENTIVE STOCK OPTION
Non-transferable
GRANT TO
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("Optionee")
the right to purchase from ▇▇▇▇▇ Respiratory Therapeutics, Inc. (the "Company")
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shares of its common stock, $0.01 par value, at the price of $_____ per share
pursuant to and subject to the provisions of the ▇▇▇▇▇ Respiratory Therapeutics,
Inc. 2005 Incentive Plan (the "Plan") and to the terms and conditions set forth
on the following page.
Unless vesting is accelerated in accordance with the Plan or in the discretion
of the Committee, the Options shall vest (become exercisable) in accordance with
the following schedule:
Continuous Status as a Participant
after Grant Date Percent of Option Shares Vested
IN WITNESS WHEREOF, ▇▇▇▇▇ Respiratory Therapeutics, Inc., acting by and
through its duly authorized officers, has caused this Certificate to be executed
as of the Grant Date.
▇▇▇▇▇ RESPIRATORY THERAPEUTICS, INC.
By: ________________________________
Its: Authorized Officer
Grant Date: _______________
Accepted by Optionee: _______________
TERMS AND CONDITIONS
1. Grant of Options. ▇▇▇▇▇ Respiratory Therapeutics, Inc. (the "Company")
hereby grants to the Optionee named on page 1 hereof ("Optionee"), under the
▇▇▇▇▇ Respiratory Therapeutics, Inc. 2005 Incentive Plan (the "Plan"), stock
options to purchase from the Company (the "Options"), on the terms and on
conditions set forth in this certificate (this "Certificate"), the number of
shares indicated on page 1 of the Company's $0.01 par value common stock, at the
exercise price per share set forth on page 1. Capitalized terms used herein and
not otherwise defined shall have the meanings assigned to such terms in the
Plan.
2. Vesting of Options. The Options shall vest (become exercisable) in
accordance with the schedule shown on Page 1 of this Agreement. Notwithstanding
the foregoing vesting schedule, the Options shall become fully vested and
exercisable (i) immediately upon a Change in Control if the Options are not
assumed by the surviving company or equitably converted or substituted, or (ii)
upon Optionee's termination of employment if the Options are assumed by the
surviving company or otherwise equitably converted or substituted in connection
with a Change in Control, and within two years after the Change in Control
Optionee's employment is terminated without Cause or, if Optionee has an
employment or similar agreement in which Optionee is permitted to resign for
Good Reason, Optionee resigns for Good Reason.
3. Term of Options and Limitations on Right to Exercise. The term of the
Options will be for a period of ten years, expiring at 5:00 p.m., Eastern Time,
on the tenth anniversary of the Grant Date (the "Expiration Date"). To the
extent not previously exercised, the Options will lapse prior to the Expiration
Date upon the earliest to occur of the following circumstances:
(a) Three months after the termination of Optionee's Continuous Status as
a Participant for any reason other than by reason of Optionee's death or
Disability.
(b) Twelve months after the date of the termination of Optionee's
Continuous Status as a Participant by reason of Disability.
(c) Twelve months after the date of Optionee's death, if Optionee dies
while employed, or during the three-month period described in subsection (a)
above or during the twelve-month period described in subsection (b) above and
before the Options otherwise lapse. Upon Optionee's death, the Options may be
exercised by Optionee's beneficiary designated pursuant to the Plan.
The Committee may, prior to the lapse of the Options under the circumstances
described in sections (a), (b) or (c) above, extend the time to exercise the
Options as determined by the Committee in writing, but if the Options are so
extended, then to the extent that they are exercised more than three months
after the termination of Optionee's employment other than by death or
Disability, or more than one year after Optionee's Disability, the Options will
automatically become Nonstatutory Stock Options. If Optionee returns to
employment with the Company during the designated post-termination exercise
period, then Optionee shall be restored to the status Optionee held prior to
such termination but no vesting credit will be earned for any period Optionee
was not in Continuous Status as a Participant. If Optionee or his or her
beneficiary exercises an Option after termination of service, the Options may be
exercised only with respect to the Shares that were otherwise vested on
Optionee's termination of service, including Options vested by acceleration
under section 2.
4. Exercise of Option. The Options shall be exercised by (a) written
notice directed to the Secretary of the Company or his or her designee at the
address and in the form specified by the Secretary from time to time and (b)
payment to the Company in full for the Shares subject to such exercise (unless
the exercise is a broker-assisted cashless exercise, as described below). If the
person exercising an Option is not Optionee, such person shall also deliver with
the notice of exercise appropriate proof of his or her right to exercise the
Option. Payment for such Shares shall be in (a) cash, (b) Shares previously
acquired by the purchaser, which have been held by the purchaser for such period
of time, if any, as necessary to avoid the recognition of an expense under
generally accepted accounting principles as a result of the exercise of the
Options, (c) withholding of Shares from the Option, but only if such withholding
would not result in the recognition of an expense under generally accepted
accounting principles as a result of the exercise of the Option, or (d) any
combination thereof, for the number of Shares specified in such written notice.
The value of Shares surrendered or withheld for this purpose shall be the Fair
Market Value as of the last trading day immediately prior to the exercise date.
To the extent permitted under Regulation T of the Federal Reserve Board, and
subject to applicable securities laws and any limitations as may be applied from
time to time by the Committee (which need not be uniform), the Options may be
exercised through a broker in a so-called "cashless exercise" whereby the broker
sells the Option Shares on behalf of Optionee and delivers cash sales proceeds
to the Company in payment of the exercise price.
5. Notification of Disposition. Optionee agrees to notify the Company in
writing within 30 days of any disposition of Shares acquired by Optionee
pursuant to the exercise of the Options, if such disposition occurs within two
years of the Grant Date, or one year of the date of exercise, of the Options.
The Company has the authority and the right to deduct or withhold, or require
Optionee to remit to the Company, an amount sufficient to satisfy federal,
state, and local taxes required by law to be withheld with respect to any
disposition of Shares prior to the expiration of two years of the Grant Date, or
one year of the date of exercise, of the Options.
6. Beneficiary Designation. Optionee may, in the manner determined by the
Committee, designate a beneficiary to exercise the rights of Optionee hereunder
and to receive any distribution with respect to the Options upon Optionee's
death. A beneficiary, legal guardian, legal representative, or other person
claiming any rights hereunder is subject to all terms and conditions of this
Certificate and the Plan and to any additional restrictions deemed necessary or
appropriate by the Committee. If no beneficiary has been designated or survives
Optionee, the Options may be exercised by the legal representative of Optionee's
estate, and payment shall be made to Optionee's estate. Subject to the
foregoing, a beneficiary designation may be changed or revoked by Optionee at
any time provided the change or revocation is filed with the Company.
7. Limitation of Rights. The Options do not confer to Optionee or
Optionee's beneficiary designated pursuant to section 6 any rights of a
shareholder of the Company unless and until Shares are in fact issued to such
person in connection with the exercise of the Options. Nothing in this
Certificate shall interfere with or limit in any way the right of the Company or
any Affiliate to terminate Optionee's service at any time, nor confer upon
Optionee any right to continue in the service of the Company or any Affiliate.
8. Restrictions on Transfer and Pledge. No right or interest of Optionee
in the Options may be pledged, encumbered, or hypothecated to or in favor of any
party other than the Company or an Affiliate, or shall be subject to any lien,
obligation, or liability of Optionee to any other party other than the Company
or an Affiliate. The Options are not assignable or transferable by Optionee
other than by will or the laws of descent and distribution.
9. Interpretation. It is the intent of the parties hereto that the
Options qualify for incentive stock option treatment pursuant to, and to the
extent permitted by, Section 422 of the Code. All provisions hereof are intended
to have, and shall be construed to have, such meanings as are set forth in
applicable provisions of the Code and Treasury Regulations to allow the Options
to so qualify. To the extent that such any portion of the Options fail to
qualify for incentive stock option treatment pursuant to Section 422 of the
Code, such nonqualifying portion of the Options shall be Nonstatutory Stock
Options, governed under Section 83 of the Code.
10. Plan Controls. The terms contained in the Plan are incorporated into
and made a part of this Certificate and this Certificate shall be governed by
and construed in accordance with the Plan. In the event of any actual or alleged
conflict between the provisions of the Plan and the provisions of this
Certificate, the provisions of the Plan shall be controlling and determinative.
11. Successors. This Certificate shall be binding upon any successor of
the Company, in accordance with the terms of this Certificate and the Plan.
12. Severability. If any one or more of the provisions contained in this
Certificate is invalid, illegal or unenforceable, the other provisions of this
Certificate will be construed and enforced as if the invalid, illegal or
unenforceable provision had never been included.
13. Notice. Notices and communications under this Agreement must be in
writing and either personally delivered or sent by registered or certified
United States mail, return receipt requested, postage prepaid. Notices to the
Company must be addressed to:
▇▇▇▇▇ Respiratory Therapeutics, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Secretary
or any other address designated by the Company in a written notice to Optionee.
Notices to Optionee will be directed to the address of Optionee then currently
on file with the Company, or at any other address given by Optionee in a written
notice to the Company.