EXHIBIT 10.19
Agreement Number#______
SXC Health Solutions Corp.
STOCK OPTION AGREEMENT
THIS STOCK OPTION AGREEMENT dated the ____ day of                     , _____
BETWEEN:
SXC Health Solutions Corp.,
a corporation incorporated under the laws of Canada,
(hereinafter called the “Corporation”)
— and —
Name of
(hereinafter called the “Optionee”),
as follows:

1)   Pursuant to the Stock Option Plan of the Corporation, as amended from time
to time (the “Plan”), the Corporation hereby grants to the Optionee on the date
hereof (the “Grant Date”) the option (the “Option”) to purchase up to _________
common shares (the “Common Shares”) of the authorized and unissued capital stock
of the Corporation, as presently constituted, for cash, at a price of
US$_________ per Common Share, upon the terms and conditions set out herein. The
Option is not intended to qualify as an incentive stock option within the
meaning of Section 422(b) of the United States Internal Revenue Code of 1986, as
amended (the “Code”), and the provisions hereof shall be construed consistent
with that intent.

  a)   Date of Exercise. On the first, second, third and fourth anniversary of
the Grant Date, the Option shall become exercisable with respect to twenty-five
percent (25%) of the total number of Common Shares subject to the Option
(computed in each case to the nearest full share) (the “Exercisable Portion”),
and all or any part of the Common Shares as to which the Option shall have
become exercisable may be purchased at any time, or from time to time,
thereafter, until expiration or termination of the Option.     b)   Expiry of
Option. The Option shall expire with respect to each Exercisable Portion, and
all rights to purchase Common Shares comprising such Exercisable Portion
hereunder shall cease and become null and void, at 5:00 o’clock p.m. (Toronto
time) on the date which is five years after the Grant Date (the “Expiry Date”)
or upon the happening of certain events as hereinafter provided.     c)   Method
of Exercise. The Option may only be exercised by the Optionee, or by the person
or persons entitled to exercise the same pursuant to the provisions of
subparagraph (f) below, on or prior to the Expiry Date, by: (i) the delivery to
the Corporation at its head office of written notice of election to exercise the
same,

 

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      specifying the number of Common Shares with respect to which the Option is
being exercised, and accompanied by payment in full of the purchase price of the
Common Shares then purchased by way of cash or certified cheque in favour of the
Corporation, or (ii) under the terms of the Company’s cashless exercise program,
which is subject to change, specifying the number of Common Shares with respect
to which the Option is being exercised and accompanied by payment in full of any
taxes required to be paid in connection with such cashless exercise.
Concurrently with its receipt of any such notice and payment, the Corporation
shall issue the Common Shares purchased by the Optionee. The Corporation may at
its election require that this Agreement be presented for appropriate
endorsement upon any such exercise.

  d)   Compliance with Applicable Law. THE GRANTING OF THE OPTION AND THE
ISSUANCE OF COMMON SHARES UPON EXERCISE OF THE OPTION SHALL BE CARRIED OUT IN
COMPLIANCE WITH APPLICABLE STATUTES AND WITH REGULATIONS OF GOVERNMENTAL
AUTHORITIES AND APPLICABLE STOCK EXCHANGES AND SHALL BE CONDITIONAL UPON ALL
NECESSARY APPROVALS, INCLUDING SHAREHOLDER APPROVAL, BEING OBTAINED. IF THE
FOREGOING CONDITION IS NOT SATISFIED, THIS AGREEMENT SHALL BE VOID AND OF NO
FORCE OR EFFECT AS OF THE DATE OF EXECUTION AND THE CORPORATION AND THE OPTIONEE
SHALL BE RELEASED FROM ANY AND ALL RIGHTS, BENEFITS, OBLIGATIONS AND LIABILITIES
HEREUNDER OR ARISING HEREFROM. The Optionee hereby acknowledges and undertakes
to comply, to the satisfaction of the Corporation and its counsel, with all
applicable requirements of any stock exchange or exchanges upon which any
securities of the Corporation may from time to time be listed and of any
applicable securities regulatory authorities. Such requirements may include the
placing of legends on share certificates restricting transfer of such Common
Shares, the making of representations by the Optionee that he or she is
acquiring such Common Shares for investment and not with a view to distribution,
the filing of any required information or statements with the aforesaid
authorities and the making of arrangements with the Optionee’s employer to
withhold income taxes which may become payable under the Optionee’s exercise of
the Option under this Agreement.

  e)   Options Not Assignable. The Option shall not be transferable or
assignable other than by will or by the laws of descent and distribution.     f)
  Exercise in the Event of Death or Termination of Employment. Subject to the
following provisions of this subparagraph 1(f) and to any express resolution
passed by the board of directors of the Corporation with respect to the Option,
the Option and all rights to purchase Common Shares pursuant hereto shall expire
and terminate immediately upon the Optionee ceasing to be an employee, officer
or director of, or ceasing to provide services to, the Corporation or an
affiliate or subsidiary of the Corporation:

  i)   Exercise Upon Death: If the Optionee shall die (A) while an employee,
officer or director of or providing services to the Corporation, or of an
affiliate or subsidiary of the Corporation, or (B) within thirty (30) days after
termination of the Optionee’s employment, office or directorship with or service
to the Corporation, or an affiliate or subsidiary of the Corporation, in
accordance with clause (ii) or (iii) below, the Option may be exercised, to the
extent that the Optionee shall have been entitled to do so at the date of death,
by the person or persons to whom the Optionee’s rights under the

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      Option pass by will or applicable law, or if no such person has such
right, by the Optionee’s executors or administrators at any time, or from time
to time, within twelve (12) months from the date when the Secretary of the
Corporation shall have given notice of this clause to the executors or
administrators of the Optionee following the Optionee’s death, but in no event
later than the Expiry Date.

  ii)   Exercise Upon Permanent Disability: If an Optionee’s (or, if the
Optionee is a personal holding company controlled by, or a registered retirement
savings plan established by, an officer, director, employee or service provider,
then if such person’s) employment, office or directorship with or services to
the Corporation, or an affiliate or subsidiary of the Corporation, shall
terminate because of the Optionee’s permanent disability, the Optionee may
exercise the Option, to the extent the Optionee may be entitled to at the date
of the termination of the Optionee’s employment, office, directorship or
services, at any time, or from time to time, within six (6) months of the date
of the termination of the Optionee’s employment, office, directorship or
services, but in no event later than the Expiry Date.     iii)   Exercise Upon
Resignation: If the Optionee’s (or, if the Optionee is a personal holding
company controlled by, or a registered retirement savings plan established by,
an officer, director, employee or service provider, then if such person’s)
employment, office or directorship with or services to the Corporation, or an
affiliate or subsidiary of the Corporation, shall terminate for any reason other
than the Optionee’s death or permanent disability or dismissal for cause, the
Optionee may exercise the Option, to the extent that the Optionee may be
entitled to do so at the date of the termination of the Optionee’s employment,
office, directorship or services, at any time or from time to time, within
ninety (90) days of the date of termination of the Optionee’s employment,
office, directorship or services; but in no event later than the Expiry Date.  
  iv)   Exercise Upon Termination for Cause: If the Optionee’s (or, if the
Optionee is a personal holding company controlled by, or a registered retirement
savings plan established by, an officer, director, employee or service provider,
then if such person’s) employment, office, directorship with or services to the
Corporation, or an affiliate or subsidiary of the Corporation, shall be
terminated for cause, the Optionee may exercise the Option, to the extent that
the Optionee would be entitled to do so at the date of the termination of his or
her employment, office, directorship or services, at any time or from time to
time, within thirty (30) days of the date of termination of the Optionee’s
employment, office, directorship or services, but in no event later than the
Expiry Date.

  g)   Required Approvals. If at any time, the board of directors of the
Corporation shall determine, in its discretion, that the registration,
qualification or other approval of or in connection with the Plan or the Common
Shares covered thereby is necessary or desirable under any provincial, state, or
federal law, then the Option may not be exercised, in whole or in part, unless
and until such registration, qualification or approval shall have been obtained,
free of any condition not acceptable to the board of directors of the
Corporation. The Optionee shall, to the extent applicable, cooperate with the
Corporation in relation thereto and shall have no claim or cause of action
against the Corporation or any of its officers, directors or

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      shareholders as the result of any failure by the Corporation to take any
steps to obtain any such registration, qualification or approval.

  h)   Adjustment to Number of Shares. Subject to any rules under Section 409A
of the Code required to be applied to an Option in order for the Option to not
constitute nonqualified deferred compensation under such Section, and subject to
any required approvals of applicable regulatory authorities and stock exchanges,
in the event of any change in the Common Shares by reason of any stock dividend,
recapitalization, merger, consolidation, split-up, combination or exchange of
shares, or rights offering to purchase Common Shares at a price substantially
below fair market value, or of any similar change affecting the Common Shares,
the number and kind of shares subject to the Option and the purchase price per
share thereof shall be appropriately adjusted consistent with such change in
such manner as the board of directors of the Corporation may deem equitable to
prevent substantial dilution or enlargement of the rights granted to, or
available for, the Optionee.

  i)   Liquidation. In the event the board of directors of the Corporation shall
adopt a plan of complete liquidation, the Option shall become immediately
exercisable in full, notwithstanding that it may have been initially granted on
an installment basis.     j)   No Rights as Shareholder. The Optionee shall not
have any rights as a shareholder with respect to any Common Shares subject to
the Option prior to the date of issuance to the Optionee of a certificate or
certificates for such Common Shares.     k)   Exercise of Option. No part of the
Option may be exercised until the Optionee shall have remained in the employ or
as an officer or director of or provided services to the Corporation, or of an
affiliate or subsidiary of the Corporation, for a period of no less than three
(3) months after the date hereof.

2)   Option and Employment. Nothing in this Agreement shall confer upon the
Optionee any right with respect to continuance of employment or as an officer or
director with or service provider to the Corporation, or any affiliate or
subsidiary of the Corporation, nor shall it interfere in any way with the right
of the Corporation, or any affiliate or subsidiary of the Corporation, by which
the Optionee is employed or of which the Optionee is a director or service
provider to terminate the Optionee’s employment or directorship or services at
any time in accordance with applicable law.

3)   Effect of Change of Control Transaction.

  a)   If a bona fide offer for common shares of the Corporation (whether by way
of take-over bid, plan of arrangement, amalgamation or similar transaction) is
made to the Optionee or to shareholders of the Corporation generally or to a
class of shareholders of the Corporation which includes the Optionee, and the
offer, if accepted in whole or in part by any person or persons, would result in
the offeror (the “Offeror”), beneficially owning a sufficient number of shares
to control the Corporation within the meaning of subsection 1(3) of the
Securities Act (Ontario) (as amended from time to time) (a “Change of Control
Transaction”), then the Corporation shall immediately notify the Optionee with
full particulars thereof. In such circumstances, notwithstanding the provisions
of subsection 1(a) of this Agreement, the Option granted pursuant to this
Agreement shall be exercisable immediately on a conditional basis as hereinafter
provided with respect to all of the Common Shares under the Option, subject to
completion of the Change of

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      Control Transaction. If the Offeror completes the Change of Control
Transaction, the Corporation shall immediately notify the Optionee, and any
exercise of the Option by the Optionee pursuant to this subparagraph 3(a) will
be deemed to have been completed immediately prior to the completion of the
Change of Control Transaction. If the Change of Control Transaction is not
completed for any reason, then the Corporation will immediately notify the
Optionee, and any exercise of the Option by the Optionee pursuant to this
subparagraph 3(a) will be deemed to be cancelled and void, the Corporation will
immediately return to the Optionee the payment which accompanied the Optionee’s
exercise of the Option pursuant to this subparagraph 3(a), and the Option will
again be exercisable only to the extent otherwise provided by this agreement.

  b)   If the Offeror will complete the purchase contemplated by the Change of
Control Transaction only if the Offeror acquires all of the issued and
outstanding Common Shares of the Corporation subject to the Change of Control
Transaction, the Corporation shall be entitled to deliver written notice (a
“Compulsory Sale Notice”) to the Optionee within 10 days following the making of
the Change of Control Transaction, stating that the Optionee shall be required
to sell to the Offeror at the time of completion of, and upon the same terms and
conditions as those contained in, the Change of Control Transaction the
particular number of Common Shares acquired by the Optionee pursuant to
subparagraph 3(a) hereof as a result of the Option having become immediately
exercisable.     c)   If the Corporation gives a Compulsory Sale Notice to the
Optionee, then the Optionee shall be obligated to sell all of the Common Shares
of the Corporation held by him or her upon the terms specified in the Change of
Control Transaction to the Offeror, conditional upon the completion of the
Change of Control Transaction.     d)   The Optionee acknowledges that in the
event he or she receives a Compulsory Sale Notice which the Corporation is
entitled to deliver hereunder and he or she fails to execute or cause to be
executed all such agreements and documents as may be necessary to enable the
common shares of the Corporation held by him or her to be sold to the Offeror as
provided herein, the Corporation may, as the true and lawful attorney for such
shareholder with full power of substitution in the name of and on behalf of such
shareholder in accordance with the Substitute Decisions Act, 1992 (Ontario),
with no restriction or limitation in that regard, and declaring that such power
of attorney may be exercised during any subsequent legal incapacity on such
shareholder’s part, execute and deliver all such agreements and documents as may
be necessary to permit the sale of such common shares of the Corporation to the
Offeror to be completed as herein provided and reflected on the books of the
Corporation. This power of attorney shall not be revoked or terminated by any
act or thing unless this Agreement is terminated or unless the Optionee ceases
to be bound by the provisions hereof.

4)   Plan Incorporated into Agreement. The Optionee acknowledges receipt of a
copy of the Plan, the terms of which are incorporated into this Agreement by
reference. In the event of any conflict between the terms of the Plan and this
Agreement, the terms of the Plan shall prevail.

5)   General. Time shall be of the essence hereof. This Agreement shall enure to
the benefit of and be binding upon the parties hereto and their respective
heirs, executors, administrators, successors and assigns, as the case may be.
This Agreement shall be

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    governed by and construed in accordance with the laws of the Province of
Ontario.

DATED as of the date first above written.

            SXC Health Solutions Corp.
   

                     
 
    )     By:        
 
                   
 
    )     Officer

 
Witness
    )
)     Signature of Optionee  
 
    )
)     type or print name of Optionee     

Plan Coordinator
[Contact information]
Chief Financial Officer
[Contact information]

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