Exhibit
10.7
STOCK
OPTION PLAN
INCENTIVE
STOCK OPTION AGREEMENT
THIS
INCENTIVE STOCK OPTION AGREEMENT entered into as of ________ ____, 20__ between
TELECOMM SALES NETWORK, INC., a Delaware corporation (the "Company"), and
_____________ (the "Optionee").
WITNESSETH:
1. The
Company, in accordance with the allotment made by the Administrator and subject
to the terms and conditions of the 2006 Stock Incentive Plan of the Company
(the
"Plan"),
grants to the Optionee an option (“Option”)
to
purchase an aggregate of __________ (______) shares of the common stock, $0.0001
par value per share, of the Company ("Common
Stock")
at an
exercise price of $______ per share, being at least equal to the fair market
value of such shares of Common Stock on the date hereof (110% of the fair market
value in the event the Optionee is a Ten Percent Holder (as defined under the
Plan)). This Option is intended to constitute an incentive stock option
(“Incentive
Stock Option”)
within
the meaning of Section 422 of the Internal Revenue Code of 1986, as amended
(the
"Code"),
although the Company makes no representation or warranty as to such
qualification.
2. The
term
of this Option shall be ____ years from the date hereof, subject to the earlier
termination as provided in the Plan.
3. Subject
to the limitations of this Agreement and as provided in the Plan, this Option
shall be exercisable for the number of shares of Common Stock indicated
according to the following schedule:
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Percentage
of Option Exercisable
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Date
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The
right
to purchase shares of Common Stock under this Option shall be cumulative, so
that if the full number of shares purchasable in a period shall not be
purchased, the balance may be purchased at any time or from time to time
thereafter, but not after the expiration of the Option. In no event may a
fraction of a share of Common Stock be purchased under this Option.
Notwithstanding any of the foregoing, to the extent that the aggregate fair
market value (determined as of the date of grant) of shares of Common Stock
with
respect to which Incentive Stock Options are exercisable by the Optionee during
any calendar year under all plans of the Company exceeds $100,000, the options
or portions thereof which exceed such limit (according to the order in which
they were granted) shall be treated as Non-Qualified Options (as defined under
the Plan). It should be understood that there is no assurance that this Option
will, in fact, be treated as an Incentive Stock Option.
4. This
Option shall be exercised by delivering a signed, completed exercise notice
in
the form of Exhibit
A,
hereto,
as the same may be modified from time to time by determination of the Company
in
its discretion, stating that the Optionee is exercising the Option hereunder,
specifying the number of shares being purchased and accompanied by payment
in
full of the aggregate purchase price therefor in
cash
(by certified or bank check or such other instrument as the Company may accept)
or, unless otherwise provided in this Agreement, by one or more of the
following: (i) in the form of unrestricted Common Stock already owned by the
Optionee, that is acceptable to the Administrator, based in any such instance
on
the fair market value of the Common Stock on the date the Option is exercised;
(ii) by certifying ownership of shares of Common Stock owned by the Optionee
to
the satisfaction of the Administrator for later delivery to the Company as
specified by the Company; (iii) by irrevocably authorizing a third party to
sell
shares of Common Stock (or a sufficient portion of the shares) acquired upon
exercise of the Option and remitting to the Company a sufficient portion of
the
sale proceeds to pay the entire exercise price and any tax withholding resulting
from such exercise; or (iv) by any combination of cash and/or any one or more
of
the methods specified in clauses (i), (ii) and (iii). Notwithstanding the
foregoing, a form of payment shall not be permitted to the extent it would
cause
the Company to recognize a compensation expense (or additional compensation
expense) with respect to the Stock Option for financial reporting
purposes.
5. The
Company may withhold cash and/or shares of Common Stock to be issued to the
Optionee in the amount which the Company determines is necessary to satisfy
its
obligation to withhold taxes or other amounts incurred by reason of the grant,
exercise or disposition of this Option or the disposition of the underlying
shares of Common Stock. Alternatively, the Company may require the Optionee
to
pay the Company such amount, in cash, promptly upon demand.
6. In
the
event of any disposition of the shares of Common Stock acquired pursuant to
the
exercise of this Option within two years from the date hereof or one year from
the date of transfer of such shares to him, the Optionee shall notify the
Company thereof in writing within 30 days after such disposition. In addition,
the Optionee shall provide the Company on demand with such information as the
Company shall reasonably request in connection with determining the amount
and
character of the Optionee's income, the Company's deduction and its obligation
to withhold taxes or other amounts incurred by reason of such disqualifying
disposition, including the amount thereof.
7. Notwithstanding
the foregoing, this Option shall not be exercisable by the Optionee unless
(a) a
Registration Statement under the Securities Act of 1933, as amended (the
"Securities
Act")
with
respect to the shares of Common Stock to be received upon the exercise of this
Option shall be effective and current at the time of exercise or (b) there
is an
exemption from registration under the Securities Act for the issuance of the
shares of Common Stock upon such exercise. The Optionee hereby represents and
warrants to the Company that, unless such a Registration Statement is effective
and current at the time of exercise of this Option, the shares of Common Stock
to be issued upon the exercise of this Option will be acquired by the Optionee
for his own account, for investment only and not with a view to the resale
or
distribution thereof. In any event, the Optionee shall notify the Company of
any
proposed resale of the shares of Common Stock issued to him upon exercise of
this Option. Any subsequent resale or distribution of shares of Common Stock
by
the Optionee shall be made only pursuant to (x) a Registration Statement under
the Securities Act which is effective and current with respect to the sale
of
shares of Common Stock being sold, or (y) a specific exemption from the
registration requirements of the Securities Act, but in claiming such exemption,
the Optionee shall, prior to any offer of sale or sale of such shares of Common
Stock, provide the Company (unless waived by the Company) with a favorable
written opinion of counsel satisfactory to the Company, in form, substance
and
scope satisfactory to the Company, as to the applicability of such exemption
to
the proposed sale or distribution. Such representations and warranties shall
also be deemed to be made by the Optionee upon each exercise of this Option.
Nothing herein shall be construed as requiring the Company to register the
shares subject to this Option under the Securities Act or to keep any
Registration Statement effective or current.
8. Notwithstanding
anything herein to the contrary, if at any time the Administrator shall
determine, in its discretion, that the listing or qualification of the shares
of
Common Stock subject to this Option on any securities exchange or under any
applicable law, or the consent or approval of any governmental agency or
regulatory body, is necessary or desirable as a condition to, or in connection
with, the granting of an option or the issue of shares of Common Stock
hereunder, this Option may not be exercised in whole or in part unless such
listing, qualification, consent or approval shall have been effected or obtained
free of any conditions not acceptable to the Administrator.
9. The
Company may affix appropriate legends upon the certificates for shares of Common
Stock issued upon exercise of this Option and may issue such "stop transfer"
instructions to its transfer agent in respect of such shares as it determines,
in its discretion, to be necessary or appropriate to (a) prevent a violation
of,
or to perfect an exemption from, the registration requirements of the Securities
Act or any applicable state securities law, (b) implement the provisions of
the
Plan, or this Agreement or any other agreement between the Company and the
Optionee with respect to such shares of Common Stock, or (c) permit the Company
to determine the occurrence of a "disqualifying disposition," as described
in
Section 421(b) of the Code, of the shares of Common Stock issued or transferred
upon the exercise of this Option.
10. Nothing
in the Plan or herein shall confer upon the Optionee any right to continue
in
the employ of the Company, any parent or any of its subsidiaries, or interfere
in any way with any right of the Company, any parent or its subsidiaries to
terminate such employment at any time for any reason whatsoever without
liability to the Company, any parent or any of its subsidiaries.
11. The
Company and the Optionee agree that they will both be subject to and bound
by
all of the terms and conditions of the Plan, a copy of which is available upon
written request addressed to the Company's Chief Financial Officer, at its
principal office and made a part hereof. Any capitalized term not defined herein
shall have the meaning ascribed to it in the Plan. In the event of a conflict
between the terms of this Agreement and the terms of the Plan, the terms of
the
Plan shall govern.
12. The
Optionee represents and agrees that he or she will comply with all applicable
laws relating to the Plan and the grant and exercise of this Option and the
disposition of the shares of Common Stock acquired upon exercise of the Option,
including without limitation, federal and state securities and "blue sky"
laws.
13. This
Option is not transferable by the Optionee otherwise than by will or the laws
of
descent and distribution and may be exercised, during the lifetime of the
Optionee, only by the Optionee or the Optionee's legal
representatives.
14. This
Agreement shall be binding upon and inure to the benefit of any successor or
assign of the Company and to any heir, distributee, executor, administrator
or
legal representative entitled to the Optionee's rights hereunder.
15. This
Agreement shall be governed by, and construed and enforced in accordance with,
the laws of the State of Delaware, without regard to the conflicts of law rules
thereof.
16. The
invalidity, illegality or unenforceability of any provision herein shall not
affect the validity, legality or enforceability of any other
provision.
17. The
Optionee agrees that the Company may amend the Plan and the options granted
to
the Optionee under the Plan, subject to the limitations contained in the
Plan.
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]
IN
WITNESS WHEREOF,
the
parties hereto have executed this Agreement as of the day and year first above
written.
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TELECOMM
SALES NETWORK, INC. |
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By: |
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Name:
Title:
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[___________],
Optionee |
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(Street
Address) |
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(City,
State and Zip Code) |
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(Social
Security Number)
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EXHIBIT
A
TELECOMM
SALES NETWORK, INC.
2006
STOCK INCENCITIVE PLAN
EXERCISE
NOTICE INCENTIVE STOCK OPTIONS
Telecomm
Sales Network, Inc.
516-D
River Highway
PMB
297
Mooresville,
NC 28117
Attention:
Chief Financial Officer
1.
Exercise of Option. Effective as of today, ________, ____, the undersigned
(“Optionee”) hereby elects to exercise Incentive Stock Options to purchase
______ shares of the Common Stock (the “Shares”) of Telecomm Sales Network, Inc.
(the “Company”), under and pursuant to the Telecomm Sales Network, Inc. 2006
Stock Incentive Plan, as the same may be amended from time to time (the “Plan”),
and the Stock Option Agreement between the Company and Optionee dated as of
______________________, as the same may be amended from time to time (the
“Option Agreement”).
2.
Delivery of Payment. Optionee herewith delivers to the Company the full purchase
price of the Shares, as set forth in the Option Agreement.
3.
Representation of Optionee. Optionee acknowledges that Optionee has received,
read and understood the Plan and the Option Agreement and agrees to abide by
and
be bound by their terms and conditions.
4.
Rights
as Stockholder. Until the stock certificate evidencing the Shares is issued
(as
evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company), no right to vote or receive dividends
or any other rights as a stockholder shall exist with respect to the Shares,
notwithstanding the exercise of the Option (as defined in the Option Agreement).
No adjustment will be made for any dividend or other right for which the record
date is prior to the date the stock certificate for the Shares is
issued.
5.
Tax
Consultation. Optionee understands that Optionee may suffer adverse tax
consequences as a result of Optionee’s purchase or disposition of the Shares.
Optionee represents that Optionee has consulted with any tax consultants
Optionee deems advisable in connection with the purchase or disposition of
the
Shares and that Optionee is not relying on the Company for any tax advice.
6.
Certain Securities Law Matters. Without limiting the provisions of the Plan
and/or the Option Agreement, Optionee understands and agrees that the Company
shall be entitled to cause appropriate legends to be placed upon any
certificate(s) evidencing ownership of the Shares that may be required by the
Company in connection with state or federal securities laws, the Option
Agreement and/or the Plan.
8.
Interpretation. Any dispute regarding the interpretation of this Exercise Notice
shall be determined by the Company’s Board of Directors or the Administrator (as
defined in the Plan), whose determination shall be final and binding on the
Company and on Optionee.
Submitted
by: _____________________
(Optionee)
Print
Name: __________________________
Address:
________________________