Exhibit 10.2

Summary Information
Employee: Name
Location: xx
Date of Grant: ___, 20__
ESOP: 19__
Exercise Price: $x.xx/Share
Expiration: earlier of xxx or 3 months post termination
Total # Shares subject to grant: xxx
Vesting: xxx Shares vest on ____, 20__ 
xxx Shares vest on ____, 20__

INCENTIVE STOCK OPTION AGREEMENT
 
This AGREEMENT is made and effective this x day of xxx, 2005 (the “Date of
Grant”), between ICO, Inc., a Texas corporation (the “Company”), and Name
(“Employee”), an employee of Company or one of its subsidiaries.
 
To carry out the purposes of ICO, Inc.’s 19XX STOCK OPTION PLAN, (the “Plan”),
by affording Employee the opportunity to purchase shares of the common stock of
the Company (“Shares”), and in consideration of the mutual agreements and other
matters set forth herein and in the Plan, the Company and Employee hereby agree
as follows:
 
1. Grant of Option. The Company hereby irrevocably grants to Employee the right
to purchase all or any part of an aggregate of xxx Shares (such right to
purchase xxx Shares at the purchase price set forth in paragraph 2 below being
referred to herein as this “Option”), on the terms and conditions set forth
herein and in the Plan, as such Plan may be amended or supplemented from time to
time, and which Plan is incorporated herein by reference as a part of this
Agreement. This Option is intended to constitute an incentive stock option
(“ISO”), within the meaning of Section 422(b) of the Internal Revenue Code of
1986, as amended (the “Code”), to the maximum extent permitted under the Code.
Employee acknowledges that only a portion of this Option may qualify as an ISO
due to the limitations set forth in section 422(d) of the Code.
 
2. Purchase Price. The purchase price of the Shares that may be purchased by
Employee pursuant to the exercise of this Option shall be $xxx per Share, which
has been determined to be not less than the fair market value of the Shares on
the Date of Grant of this Option. For the purpose of this Agreement, the “fair
market value” of the Shares shall be determined in accordance with the
definition of “fair market value” contained in the Plan.
 
3. Exercise of Option. Subject to the earlier expiration of this Option as set
forth below, this Option may be exercised in full or part, by written notice to
the Company at its principal executive office addressed to the attention of its
General Counsel, at any time and from time to time after the Date of Grant
hereof, but, except as otherwise provided below, this Option shall not be
exercisable for more than a percentage of the aggregate number of Shares offered
by this Option determined by the number of full years from the Date of Grant to
the date of such exercise, in accordance with the following vesting schedule:
 
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Number of Full Years
Following the Date of Grant
Percentage of Shares
That May Be Purchased
Less than 1 year (vest on Date of Grant)
 xx% (xxx Shares)
1 year (vest on 1st anniversary of Date of Grant)
 xx% (xxx Shares)
2 years (vest on 2nd anniversary of Date of Grant)
 xx% (xxx Shares)
   

 
Furthermore, in order to exercise this Option or any portion thereof, Employee
must be an employee of the Company or of a subsidiary of the Company at all
times during the period beginning on the Date of Grant and ending on the day
three months before the date of exercise. This Option shall not be exercisable
in any event after the expiration of the earlier of: (a) ten (10) years from the
Date of Grant hereof, or (b) the first business day following expiration of the
three month period after the date when Employee ceases to be an employee of the
Company or any subsidiary of the Company. Furthermore, any options that have not
vested prior to the date of Employee’s termination of employment shall not be
exercisable. The purchase price of shares as to which this Option is exercised
shall be paid as provided under the provisions of the Plan.
 
4. Withholding of Tax. To the extent that the exercise of this Option or the
disposition of Shares acquired by exercise of this Option results in
compensation income or wages to Employee for federal, state, or local tax
purposes, Employee shall deliver to the Company at the time of such exercise or
disposition such amount of money or Shares as the Company may require to meet
its obligations under applicable tax laws or regulations, and, if Employee fails
to do so, the Company is authorized to withhold from any cash or Share
remuneration then or thereafter payable to Employee any tax required to be
withheld by reason of such resulting compensation income. Upon an exercise of
this Option, the Company is further authorized in its discretion to satisfy any
such withholding requirements out of any cash or Shares distributable to
Employee upon such exercise.
 
5. Binding Effect. This Agreement shall be binding upon and inure to the benefit
of any successors to the Company and all persons lawfully claiming under
Employee. In the event of conflict between any of the provisions in this
Agreement and provisions in the Plan, the provisions of the Plan will govern.
 
6. Dispute Resolution. This Agreement and the Option granted hereunder, shall be
governed by, and construed in accordance with the laws of the State of Texas,
without regard to its principles of conflicts of law. Any and all controversies,
claims and differences arising out of or relating to the Option granted under
this Agreement which cannot be settled by good faith negotiation between the
parties will be finally settled by binding arbitration brought within three (3)
months of the termination of the Option, with the date of termination to be
governed by the provisions of the Plan and this Agreement. The binding
arbitration will be conducted in accordance with the then existing rules of the
American Arbitration Association (“AAA”), by one arbitrator. In the event of any
conflict between such rules and this paragraph, the provisions of this paragraph
shall govern. Upon the written demand of either party, the parties shall appoint
a single arbitrator acceptable to both parties. Arbitration proceedings shall be
held in Houston, Texas. The decision of the arbitrator shall be final and
binding upon the parties hereto, not subject to appeal, and shall deal with the
questions of interest, cost of the arbitration, and all matters relevant
thereto. Judgment upon the award or decision rendered by the arbitrator may be
entered in any court having jurisdiction thereof, or application may be made to
such court for a judicial recognition of the award or any order of enforcement
thereof as the case may be.
 
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IN WITNESS WHEREOF, the Company has caused this Agreement to be duly executed by
its officer thereunto duly authorized, and Employee has executed this Agreement,
to be effective as of the Date of Grant set forth above.
 

 
ICO, INC.
                                
                               By: ___________________________________
                      Printed Name: ___________________________
 
Title: __________________________________
 

 

                            
EMPLOYEE
                             
                   xxx
 
 
 
 
 
 
 
 
 
 
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