Exhibit 10.5

 

NON-QUALIFIED STOCK OPTION AGREEMENT
FOR SENIOR EXECUTIVES

 

UNDER THE

 

INVERNESS MEDICAL INNOVATIONS, INC.
2001 STOCK OPTION AND INCENTIVE PLAN

 

Name of Optionee:

 

Number of Option Shares:

 

Option Exercise Price Per Share:

 

Grant Date:

 

Expiration Date:

 

 

Pursuant to the Inverness Medical Innovations, Inc. 2001 Stock Option and
Incentive Plan (the “Plan”) as amended through the date hereof, Inverness
Medical Innovations, Inc. (the “Company”) hereby grants to the Optionee named
above an option (the “Stock Option”) to purchase, on or prior to the Expiration
Date specified above, all or part of the number of Option Shares of Common
Stock, par value $0.001 per share (the “Stock”) of the Company specified above
at the Option Exercise Price per Share specified above subject to the terms and
conditions set forth herein and in the Plan.

 

1.                                       EXERCISABILITY SCHEDULE.  NO PORTION OF
THIS STOCK OPTION MAY BE EXERCISED UNTIL SUCH PORTION SHALL HAVE BECOME
EXERCISABLE.  EXCEPT AS SET FORTH BELOW, AND SUBJECT TO THE DISCRETION OF THE
ADMINISTRATOR (AS DEFINED IN SECTION 2 OF THE PLAN) TO ACCELERATE THE
EXERCISABILITY SCHEDULE HEREUNDER, THIS STOCK OPTION SHALL BECOME EXERCISABLE
WITH RESPECT TO THE FOLLOWING NUMBER OF OPTION SHARES ON THE DATES INDICATED, SO
LONG AS THE OPTIONEE REMAINS IN EMPLOYMENT WITH THE COMPANY ON THE
EXERCISABILITY DATE:

 

Exercisability
Date

 

Number of
Option Shares First
Becoming Exercisable

 

Total Number of
Option Shares
Exercisable

 

 

 

 

 

 

 

 

 

(     

)%

(     

)%

 

 

 

 

 

 

 

 

(     

)%

(     

)%

 

 

 

 

 

 

 

 

(     

)%

(     

)%

 

 

 

 

 

 

 

 

(     

)%

(100

)%

 

1

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Once exercisable, this Stock Option shall continue to be exercisable at any time
or times prior to the close of business on the Expiration Date, subject to the
provisions hereof and of the Plan.

 

2.                                       MANNER OF EXERCISE.

 

(A)                                  THE OPTIONEE MAY EXERCISE THIS OPTION ONLY
IN THE FOLLOWING MANNER:  FROM TIME TO TIME ON OR PRIOR TO THE EXPIRATION DATE
OF THIS OPTION, THE OPTIONEE MAY GIVE WRITTEN NOTICE TO THE ADMINISTRATOR OF HIS
OR HER ELECTION TO PURCHASE SOME OR ALL OF THE OPTION SHARES PURCHASABLE AT THE
TIME OF SUCH NOTICE.  THIS NOTICE SHALL SPECIFY THE NUMBER OF OPTION SHARES TO
BE PURCHASED.

 

Payment of the purchase price for the Option Shares may be made by one or more
of the following methods:  (i) in cash, by certified or bank check or other
instrument acceptable to the Administrator; (ii) through the delivery (or
attestation to the ownership) of shares of Stock that have been purchased by the
Optionee on the open market or that have been “paid for” and beneficially owned
by the Optionee for at least six months and are not then subject to any
restrictions under any Company plan; (iii) by the Optionee delivering to the
Company a properly executed exercise notice together with irrevocable
instructions to a broker to promptly deliver to the Company cash or a check
payable and acceptable to the Company to pay the option purchase price, provided
that in the event the Optionee chooses to pay the option purchase price as so
provided, the Optionee and the broker shall comply with such procedures and
enter into such agreements of indemnity and other agreements as the
Administrator shall prescribe as a condition of such payment procedure; or
(iv) a combination of (i), (ii), and (iii) above.  Payment instruments will be
received subject to collection.

 

The delivery of certificates representing the Option Shares will be contingent
upon the Company’s receipt from the Optionee of full payment for the Option
Shares, as set forth above and any agreement, statement or other evidence that
the Company may require to satisfy itself that the issuance of Stock to be
purchased pursuant to the exercise of Options under the Plan and any subsequent
resale of the shares of Stock will be in compliance with applicable laws and
regulations.  In the event the Optionee chooses to pay the purchase price by
previously-owned shares of Stock through the attestation method, the number of
shares of Stock transferred to the Optionee upon the exercise of the Option
shall be net of the Shares attested to.

 

(B)                                 CERTIFICATES FOR SHARES OF STOCK PURCHASED
UPON EXERCISE OF THIS STOCK OPTION SHALL BE ISSUED AND DELIVERED TO THE OPTIONEE
UPON COMPLIANCE TO THE SATISFACTION OF THE ADMINISTRATOR WITH ALL REQUIREMENTS
UNDER APPLICABLE LAWS OR REGULATIONS IN CONNECTION WITH SUCH ISSUANCE AND WITH
THE REQUIREMENTS HEREOF AND OF THE PLAN.  THE DETERMINATION OF THE ADMINISTRATOR
AS TO SUCH COMPLIANCE SHALL BE FINAL AND BINDING ON THE OPTIONEE.  THE OPTIONEE
SHALL NOT BE DEEMED TO BE THE HOLDER OF, OR TO HAVE ANY OF THE RIGHTS OF A
HOLDER WITH RESPECT TO, ANY SHARES OF STOCK SUBJECT TO THIS STOCK OPTION UNLESS
AND UNTIL THIS STOCK OPTION SHALL HAVE BEEN EXERCISED PURSUANT TO THE TERMS
HEREOF, THE COMPANY SHALL HAVE ISSUED AND DELIVERED THE SHARES TO THE OPTIONEE,
AND THE OPTIONEE’S NAME SHALL HAVE BEEN ENTERED AS THE STOCKHOLDER OF RECORD ON
THE BOOKS OF THE COMPANY.  THEREUPON, THE OPTIONEE SHALL HAVE FULL VOTING,
DIVIDEND AND OTHER OWNERSHIP RIGHTS WITH RESPECT TO SUCH SHARES OF STOCK.

 

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(C)                                  THE MINIMUM NUMBER OF SHARES WITH RESPECT
TO WHICH THIS STOCK OPTION MAY BE EXERCISED AT ANY ONE TIME SHALL BE 10 SHARES,
UNLESS THE NUMBER OF SHARES WITH RESPECT TO WHICH THIS STOCK OPTION IS BEING
EXERCISED IS THE TOTAL NUMBER OF SHARES SUBJECT TO EXERCISE UNDER THIS STOCK
OPTION AT THE TIME.

 

(D)                                 NOTWITHSTANDING ANY OTHER PROVISION OF THIS
AGREEMENT OR OF THE PLAN, NO PORTION OF THIS STOCK OPTION SHALL BE EXERCISABLE
AFTER THE EXPIRATION DATE.

 

3.                                       TERMINATION OF EMPLOYMENT.  IF THE
OPTIONEE’S EMPLOYMENT BY THE COMPANY OR A SUBSIDIARY (AS DEFINED IN THE PLAN) IS
TERMINATED, NO ADDITIONAL OPTION SHARES SHALL BECOME EXERCISABLE FOLLOWING THE
DATE OF TERMINATION AND THE PERIOD WITHIN WHICH TO EXERCISE THE EXERCISABLE
PORTION OF THE OPTION MAY BE SUBJECT TO EARLIER TERMINATION AS SET FORTH BELOW.

 

(A)                                  TERMINATION DUE TO DEATH.  IF THE
OPTIONEE’S EMPLOYMENT TERMINATES BY REASON OF DEATH, ANY OPTION HELD BY THE
OPTIONEE SHALL BECOME FULLY EXERCISABLE AND MAY THEREAFTER BE EXERCISED BY THE
OPTIONEE’S LEGAL REPRESENTATIVE OR LEGATEE FOR A PERIOD OF TWELVE MONTHS FROM
THE DATE OF DEATH OR UNTIL THE EXPIRATION DATE, IF EARLIER.

 

(B)                                 TERMINATION DUE TO DISABILITY.  IF THE
OPTIONEE’S EMPLOYMENT TERMINATES BY REASON OF DISABILITY (AS DETERMINED BY THE
ADMINISTRATOR), ANY OPTION HELD BY THE OPTIONEE SHALL BECOME FULLY EXERCISABLE
AND MAY THEREAFTER BE EXERCISED BY THE OPTIONEE FOR A PERIOD OF TWELVE MONTHS
FROM THE DATE OF TERMINATION OR UNTIL THE EXPIRATION DATE, IF EARLIER.  THE
DEATH OF THE OPTIONEE DURING THE TWELVE-MONTH PERIOD PROVIDED IN THIS
SECTION 3(B) SHALL EXTEND SUCH PERIOD FOR ANOTHER TWELVE MONTHS FROM THE DATE OF
DEATH OR UNTIL THE EXPIRATION DATE, IF EARLIER.

 

(C)                                  TERMINATION FOR CAUSE.  IF THE OPTIONEE’S
EMPLOYMENT TERMINATES FOR CAUSE, ANY OPTION HELD BY THE OPTIONEE SHALL TERMINATE
IMMEDIATELY AND BE OF NO FURTHER FORCE AND EFFECT.  FOR PURPOSES HEREOF, “CAUSE”
SHALL MEAN: (I) ANY MATERIAL BREACH BY THE OPTIONEE OF ANY AGREEMENT BETWEEN THE
OPTIONEE AND THE COMPANY; (II) THE CONVICTION OF OR A PLEA OF NOLO CONTENDERE BY
THE OPTIONEE TO A FELONY OR A CRIME INVOLVING MORAL TURPITUDE; OR (III) ANY
MATERIAL MISCONDUCT OR WILLFUL AND DELIBERATE NON-PERFORMANCE (OTHER THEN BY
REASON OF DISABILITY) BY THE OPTIONEE OF THE OPTIONEE’S DUTIES TO THE COMPANY. 
IF IT IS DISCOVERED THAN AN OPTIONEE’S EMPLOYMENT COULD HAVE BEEN TERMINATED FOR
CAUSE BUT SUCH INFORMATION WAS NOT KNOWN BY THE COMPANY, THE DATE OF TERMINATION
OF EMPLOYMENT SHALL BE DEEMED TO BE THE DATE ON WHICH THE ACT CONSTITUTING CAUSE
TOOK PLACE.  IN THE EVENT THAT AN OPTIONEE HAS EXERCISED AN OPTION AFTER HE OR
SHE HAS COMMITTED AN ACT CONSTITUTING CAUSE, THE ADMINISTRATOR MAY TAKE ACTION
TO RECOVER THE OPTION SHARES AND ANY GAINS MADE BY THE OPTIONEE IN RESPECT OF
SUCH OPTION SHARES.

 

(D)                                 OTHER TERMINATION.  IF THE OPTIONEE’S
EMPLOYMENT TERMINATES FOR ANY REASON OTHER THAN DEATH, DISABILITY OR CAUSE, AND
UNLESS OTHERWISE DETERMINED BY THE ADMINISTRATOR, ANY OPTION HELD BY THE
OPTIONEE MAY BE EXERCISED, TO THE EXTENT EXERCISABLE ON THE DATE OF TERMINATION,
FOR A PERIOD OF THREE MONTHS FROM THE DATE OF TERMINATION OR UNTIL THE
EXPIRATION DATE, IF EARLIER; PROVIDED THAT IF THE OPTIONEE’S EMPLOYMENT
TERMINATES BY REASON OF VOLUNTARY RETIREMENT (AS DETERMINED BY THE
ADMINISTRATOR) AFTER THE AGE OF 58 THEN OPTIONS EXERCISABLE ON THE DATE OF
TERMINATION MAY BE EXERCISED FOR A PERIOD OF TWELVE MONTHS FROM THE DATE OF
TERMINATION OR UNTIL THE EXPIRATION DATE, IF EARLIER.  ANY OPTION THAT IS NOT
EXERCISABLE AT SUCH TIME SHALL TERMINATE IMMEDIATELY AND BE OF NO FURTHER FORCE
OR EFFECT.

 

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The Administrator’s determination of the reason for termination of the
Optionee’s employment shall be conclusive and binding on the Optionee and his or
her representatives or legatees.

 

4.                                       INCORPORATION OF PLAN.  NOTWITHSTANDING
ANYTHING HEREIN TO THE CONTRARY, THIS STOCK OPTION SHALL BE SUBJECT TO AND
GOVERNED BY ALL THE TERMS AND CONDITIONS OF THE PLAN.  CAPITALIZED TERMS IN THIS
AGREEMENT SHALL HAVE THE MEANING SPECIFIED IN THE PLAN, UNLESS A DIFFERENT
MEANING IS SPECIFIED HEREIN.

 

5.                                       TRANSFERABILITY.  THIS AGREEMENT IS
PERSONAL TO THE OPTIONEE, IS NON-ASSIGNABLE AND IS NOT TRANSFERABLE IN ANY
MANNER, BY OPERATION OF LAW OR OTHERWISE, OTHER THAN BY WILL OR THE LAWS OF
DESCENT AND DISTRIBUTION.  THIS STOCK OPTION IS EXERCISABLE, DURING THE
OPTIONEE’S LIFETIME, ONLY BY THE OPTIONEE, AND THEREAFTER, ONLY BY THE
OPTIONEE’S LEGAL REPRESENTATIVE OR LEGATEE.  NOTWITHSTANDING THE FOREGOING, THIS
OPTION MAY BE TRANSFERRED TO MEMBERS OF THE OPTIONEE’S IMMEDIATE FAMILY, TO
TRUSTS FOR THE BENEFIT OF SUCH FAMILY MEMBERS, OR TO PARTNERSHIPS IN WHICH SUCH
FAMILY MEMBERS ARE THE ONLY PARTNERS UPON APPROVAL OF THE ADMINISTRATOR
FOLLOWING SUBMISSION OF A PETITION FOR SUCH TRANSFER FROM THE OPTIONEE TO THE
ADMINISTRATOR AND THE AGREEMENT OF THE PROPOSED TRANSFEREE TO BE BOUND BY THE
TERMS OF THE PLAN AND THIS AGREEMENT.

 

6.                                       TAX WITHHOLDING.  THE OPTIONEE SHALL,
NOT LATER THAN THE DATE AS OF WHICH THE EXERCISE OF THIS STOCK OPTION BECOMES A
TAXABLE EVENT FOR FEDERAL INCOME TAX PURPOSES, PAY TO THE COMPANY OR MAKE
ARRANGEMENTS SATISFACTORY TO THE ADMINISTRATOR FOR PAYMENT OF ANY FEDERAL,
STATE, AND LOCAL TAXES REQUIRED BY LAW TO BE WITHHELD ON ACCOUNT OF SUCH TAXABLE
EVENT. SUBJECT TO THE WRITTEN INSTRUCTIONS FROM THE ADMINISTRATOR, THE OPTIONEE
MAY HAVE THE MINIMUM REQUIRED TAX WITHHOLDING OBLIGATION SATISFIED, IN WHOLE OR
IN PART, BY (I) AUTHORIZING THE COMPANY TO WITHHOLD FROM SHARES OF STOCK TO BE
ISSUED, OR (II) TRANSFERRING TO THE COMPANY, A NUMBER OF SHARES OF STOCK WITH AN
AGGREGATE FAIR MARKET VALUE THAT WOULD SATISFY THE WITHHOLDING AMOUNT DUE.

 

7.                                       MISCELLANEOUS.

 

(A)                                  NOTICE HEREUNDER SHALL BE GIVEN TO THE
COMPANY AT ITS PRINCIPAL PLACE OF BUSINESS, AND SHALL BE GIVEN TO THE OPTIONEE
AT THE ADDRESS SET FORTH BELOW, OR IN EITHER CASE AT SUCH OTHER ADDRESS AS ONE
PARTY MAY SUBSEQUENTLY FURNISH TO THE OTHER PARTY IN WRITING.

 

(B)                                 THIS STOCK OPTION DOES NOT CONFER UPON THE
OPTIONEE ANY RIGHTS WITH RESPECT TO CONTINUANCE OF EMPLOYMENT BY THE COMPANY OR
ANY SUBSIDIARY.

 

(C)                                  THIS STOCK OPTION IS NOT INTENDED TO BE AN
INCENTIVE STOCK OPTION AS DEFINED IN SECTION 422 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED.

 

—Signature page follows—

 

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For:

INVERNESS MEDICAL
INNOVATIONS, INC.

 

 

 

 

 

 

 

By:

 

 

 

Title:

 

 

The foregoing Agreement is hereby accepted and the terms and conditions thereof
hereby agreed to by the undersigned.

 

 

Dated:

 

 

 

 

 

 

Optionee’s Signature

 

 

 

 

 

 

 

 

Optionee’s name and address:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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