Exhibit 10.3

INTEGRATED ELECTRICAL SERVICES, INC.

AMENDED AND RESTATED 2006 EQUITY INCENTIVE PLAN

OPTION AWARD AGREEMENT

THIS OPTION AWARD AGREEMENT (“Agreement”) is made and entered into as of
[            ] (“Grant Date”) by and between Integrated Electrical Services,
Inc., a Delaware corporation (“Company”), and [            ] (“Optionee”)
pursuant to the terms and conditions of the Integrated Electrical Services, Inc.
Amended and Restated 2006 Equity Incentive Plan (“Plan”).

SECTION 1. GRANT OF OPTION AWARD.

(a) Option Award. On the terms and conditions set forth in this Agreement and
the Plan, the Company grants to the Optionee on the Grant Date an option to
purchase [            ] Shares at an Exercise Price of $             per Share.
This option is intended to be a nonqualified stock option.

(b) Plan and Defined Terms. This option is granted under and subject to the
terms of the Plan, which is incorporated herein by reference. If there is any
inconsistency between the terms of the Plan and the terms of this Agreement, the
Plan’s terms shall supersede and replace the conflicting terms of this
Agreement. Capitalized terms that are defined in the Plan are incorporated
herein by reference and other capitalized terms are defined in Section 10 of
this Agreement.

(c) Exercisability. Subject to the terms and conditions set forth in this
Agreement and the Plan, this option or a portion thereof may be exercised
(i) prior to its expiration and (ii) on or after the time this option or such
portion thereof is vested pursuant to the vesting provisions set forth in
Section 2 herein.

(d) Scope of this Agreement. This Agreement shall apply both to this option and
to the Shares acquired upon exercise of this option.

SECTION 2. VESTING.

Subject to the further provisions of this Agreement, the option shall vest
(become exercisable) according to the following schedule:

 

[Vesting Dates

   Option Shares Vested Prior to the 1st anniversary of the Grant Date    0% 1st
anniversary of the Grant Date    33 1⁄3% 2nd anniversary of the Grant Date   
66 2⁄3% On and after the 3rd anniversary of the Grant Date    100%]1

SECTION 3. TERM AND EXPIRATION.

(a) Basic Term. Subject to earlier termination as set forth herein, the exercise
period of this option shall expire ten (10) years after the Grant Date (the
“Term”).

 

1  Alternative vesting schedules may be substituted for the schedule set forth
herein in accordance with the terms of the Plan.

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(b) Termination of Service (except for Cause). In the event Optionee’s Service
terminates for any reason other than for Cause, then this option, to the extent
vested as of the date of such termination, shall expire on the earliest of:
(i) the expiration of the Term, (ii) twelve (12) months following such
termination, if as a result of death or Disability, (iii) thirty-six months
(36) following such termination, if due the Optionee’s termination of Service
other than due to death or Disability or Cause after having attained age 55 and
having completed 10 years of Service (“Retirement”), and (iv) three (3) months
following such termination, if for any reason other than death, Disability or
Retirement. This option to the extent unvested as of the date of such
termination shall immediately expire and lapse upon such termination.

(c) Termination of Service (for Cause). Notwithstanding the foregoing provisions
of this Section 3, in the event Optionee’s Service is terminated for Cause or
Cause exists on the date Optionee’s Service terminates (regardless of whether
such termination would otherwise qualify as a termination due to death,
Disability or Retirement), then this option shall be cancelled and forfeited
immediately on the date of such termination, regardless of whether then
otherwise vested and exercisable, and any purported exercise of this option
prior to such termination which shall not have been effected through the
delivery of Shares shall be deemed void and without effect and all actions taken
to exercise such option (including an payment of the exercise price thereof or
any direction to sell the underlying Shares when issued) will be rescinded.

SECTION 4. CHANGE IN CONTROL

If the Committee reasonably determines in good faith prior to the occurrence of
a Change in Control that this option shall be honored or assumed, or new rights
substituted therefore (such honored, assumed or substituted award hereinafter
called an “Alternative Award”), by your employer (or the parent or an affiliate
of such employer) immediately following the Change in Control, then this option
shall continue in effect in accordance with its terms (subject to any adjustment
affected under the Plan and Section 8 hereto in connection with such event to
modify the securities or other property to which this option shall relate and to
make a corresponding adjustment to the Exercise Price). If the Committee does
not determine that this option will be replaced by an Alternative Award, then in
the event of a Change in Control, this option shall become immediately vested
and exercisable in full, regardless of the provisions of Section 2 hereof.
Without limiting the generality of the foregoing, the Committee may, in its sole
discretion, provide that this option will be cancelled upon the occurrence of
such Change in Control in exchange for a cash payment for each Share subject
hereto equal to the excess of the Fair Market Value in effect immediately prior
to the occurrence of the Change in Control over the Exercise Price. To the
extent that the Exercise Price of this option exceeds such Fair Market Value at
the Change in Control, the Committee may direct that this option shall be
cancelled without consideration upon the occurrence of such Change in Control.
To qualify as an Alternative Award, the Committee must determine that such an
award

(a) is based on stock that is traded on an established securities market;

 

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(b) provides you with rights and entitlements substantially equivalent to or
better than the rights, terms and conditions otherwise applicable under this
option, including, but not limited to, a vesting schedule that is at least as
favorable a the vesting schedule in Section 2;

(c) has substantially equivalent value to this option, determined at the time of
the Change in Control; and

(d) has terms and conditions which provide that, in the event that your
employment is involuntarily terminated following the Change in Control for any
reason other than for Cause, any portion of the option then outstanding shall be
deemed immediately and fully exercisable and/or all restrictions shall lapse,
and shall be settled for a payment per each share of stock subject to the
Alternative Award in cash, in immediately transferable, publicly traded
securities, or in a combination thereof, in an amount equal to the excess of
(i) the fair market value of such stock on the date of such termination over
(ii) the exercise price per share applicable thereto.

SECTION 5. TRANSFER OR ASSIGNMENT OF OPTION.

Unless otherwise expressly permitted by the Company, on such terms and subject
to such conditions as the Committee may specify, this option may not be
transferred, assigned, pledged or hypothecated by the Optionee during the
Optionee’s lifetime, whether by operation of law or otherwise, or be made
subject to execution, attachment or similar process. The right to exercise this
option may transfer upon the death of the optionee by a beneficiary designation
provided in writing in accordance with such requirements as the Company shall
specify from time to time, or by will or the laws of descent and distribution.
Subject to the limitations contained herein, this option may be exercised during
the lifetime of the Optionee only by the Optionee or by the Optionee’s Eligible
Representative.

SECTION 6. EXERCISE.

(a) Exercise Procedure. An exercisable option, or any exercisable portion
thereof, may be exercised by in accordance with the following procedure, or such
other procedure as the Company shall specify in writing to the Optionee at any
time or from time to time. Unless another procedure shall have been identified
to the Optionee by the Company, to exercise any exercisable portion of the
option, in whole or in part, the Optionee shall deliver to the Secretary of the
Company (or his or her designee)::

(i) Notice in writing signed by the Optionee or his or her Eligible
Representative, stating the number of Shares with respect to which this option
or a portion thereof is being exercised;

(ii) Full payment of the aggregate Exercise Price of the Shares with respect to
which this option (or portion thereof) is thereby exercised in accordance with
any method permitted in accordance with Section 7 herein;

(iii) The payment to the Company, or other arrangements satisfactory to the
Company that will ensure payment, of all amounts necessary to satisfy any and
all federal, state and local tax withholding requirements arising in connection
with the exercise of this option (or a portion thereof) in accordance with any
method permitted in accordance with the Plan and this Agreement; and

 

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(iv) Such representations and documents as the Company deems necessary or
advisable to effect compliance with all applicable federal or state securities
laws or regulations. Within limiting the generality of the foregoing, the
Company may, in its sole discretion, also take whatever additional actions it
deems necessary or appropriate to effect such compliance with applicable law,
including, without limitation, placing legends on share certificates and issuing
stop-transfer orders to transfer agents and registrars.

To the extent that any person or persons other than the Optionee purports to
have the right to exercise the option (in whole in part), such person shall be
required to provide the Company with such proof satisfactory to the Company of
such right and the identity of such person.

(b) Issuance of Shares. The Company shall cause the Shares issuable upon any
proper exercise of this option to be registered or otherwise recorded in the
name of the person exercising this option or a portion thereof (or in the names
of such person and his or her spouse as community property or as joint tenants
with right of survivorship), in such form (i.e., book entry, share certificates)
as the Company shall determine in light of the Company’s practices and
procedures.

SECTION 7. PAYMENT FOR SHARES

(a) Cash or Check. All or part of the Exercise Price and any applicable
withholding requirements may be paid in cash or by check.

(b) Alternative Methods of Payment All or any part of the Exercise Price and any
applicable withholding requirements may be paid by one or more of the following
methods:

(i) Surrender of Shares. At the discretion of the Optionee, all or any part of
the Exercise Price and any applicable withholding requirements may be paid or
satisfied by surrendering, or attesting to the ownership of, Shares that are
already owned by the Optionee. Such Shares shall be surrendered to the Company
in good form for transfer and shall be valued at their Fair Market Value on the
date when the option or a portion thereof is exercised. Notwithstanding the
foregoing, the Optionee shall not surrender, or attest to the ownership of,
Shares in payment of any portion of the Exercise Price (or withholding) if such
action would cause the Company or any Subsidiary to recognize an additional
compensation expense with respect to the option for financial reporting
purposes, unless the Committee consents thereto.

(ii) Net Exercise. At the discretion of the Optionee, payment of all or any
portion of the Exercise Price and any applicable withholding requirements may be
made by reducing the number of Shares otherwise deliverable pursuant to the
option by the number of such Shares having a Fair Market Value equal to the
Exercise Price and/or any applicable withholding requirement. Notwithstanding
the foregoing, the Optionee shall not be permitted to pay any portion of the
Exercise Price (or withholding) in such manner if such action would cause the
Company or any Subsidiary to recognize an additional compensation expense with
respect to the option for financial reporting purposes unless the Committee
consents thereto.

 

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(iii) Exercise/Sale. Payment may be effected in whole or in part by the delivery
(on a form prescribed by the Company) of an irrevocable direction to a
securities broker approved by the Company to act on behalf of the Optionee
(x) to sell Shares and deliver to the Company such portion of the sales proceeds
as shall be necessary or appropriate to pay the Exercise Price and/or any
applicable withholding associated with the exercise of such option, or (ii) to
deliver to the Company such portion of a loan from such broker that is secured,
in whole or in part, by the pledge of the Shares deliverable upon the exercise
of such option as shall be necessary or appropriate to pay the Exercise Price
and/or any applicable withholding associated with the exercise of such option.

The Committee shall have the authority to rescind, modify or eliminate any of
the alternative methods as set forth in this Section, and to add additional
permissible methods or substitute other methods therefor, at its discretion, at
any time and from time to time upon written notice thereof to the Optionee.

SECTION 8. ADJUSTMENT OF SHARES.

In the event of a Recapitalization, an adjustment shall be made to this option
such that the option shall thereafter be exercisable or payable, as the case may
be, in such securities, cash and/or other property as would have been received
in respect of Shares subject to the option had the option been exercised
immediately prior to such Recapitalization and such an adjustment shall be made
successively each time any such change shall occur. In addition, in the event of
any Recapitalization, to prevent dilution or enlargement of Optionee’s rights
hereunder, the Committee shall, and will have the authority to adjust, in a fair
and equitable manner, the Exercise Price and the number and kind of shares
subject to this option. Should the vesting of this option be conditioned upon
the Company’s attainment of performance conditions, the Committee may make such
adjustments to such terms and conditions of this option and the criteria therein
to recognize unusual and nonrecurring events affecting the Company or in
response to changes in applicable laws, regulations or accounting principles.

SECTION 9. MISCELLANEOUS PROVISIONS.

(a) Notification. Any notification required by the terms of this Agreement shall
be given in writing and shall be deemed effective upon personal delivery or upon
deposit with the United States Postal Service, by registered or certified mail,
with postage and fees prepaid. A notice shall be addressed to the Company at its
principal executive office and to the Optionee at the address that he or she
most recently provided to the Company.

(b) Rights as a Shareholder. Neither the Optionee nor the Optionee’s
representative shall have any rights as a shareholder with respect to any Shares
subject to this option until the Optionee or the Optionee’s representative
becomes entitled to receive such Shares by satisfaction of the exercise
procedures set forth herein.

 

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(c) No Retention Rights. Nothing in the Plan or the Agreement shall confer upon
a Optionee any right to continue in Service for any period of specific duration
or interfere with or otherwise restrict in any way the rights of the Company (or
any Subsidiary employing or retaining the Optionee) or of the Optionee, which
rights are hereby expressly reserved by each, to terminate his or her Service at
any time and for any reason, with or without Cause.

(d) Entire Agreement. This Agreement and the Plan constitute the entire contract
between the parties hereto with regard to the subject matter hereof and
supersede any other agreements, representations or understandings (whether oral
or written and whether express or implied) which relate to the subject matter
hereof.

(e) Waiver. No waiver of any breach or condition of this Agreement shall be
deemed to be a waiver of any other or subsequent breach or condition whether of
like or different nature.

(f) Successors and Assigns. The provisions of this Agreement shall inure to the
benefit of, and be binding upon, the Company and its successors and assigns and
upon the Optionee, the Optionee’s assigns and the legal representatives, heirs
and legatees of the Optionee’s estate, whether or not any such person shall have
become a party to this Agreement and have agreed in writing to be join herein
and be bound by the terms hereof.

(g) Choice of Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, as such laws are applied to
contracts entered into and performed in such State.

SECTION 10. DEFINITIONS.

(a) “Agreement” shall mean this Option Award Agreement.

(b) “Exercise Price” shall mean the price payable by the Optionee (or as
applicable, the Eligible Representative) to exercise this option as to any Share
subject to this option.

(c) “Grant Date” shall have the meaning ascribed to such term in the
introduction of this Agreement.

(d) “Optionee” shall have the meaning ascribed to such term in the introduction
of this Agreement.

(e) “Service” shall mean service as an Employee, Director or Consultant. For any
purpose under this Agreement, Service shall be deemed to continue while the
Optionee is on a bona fide leave of absence, if such leave was approved by the
Company or Subsidiary in writing or if continued crediting of Service for such
purpose is expressly required by the terms of such leave or by applicable law
(as determined by the Committee).

(f) “Term” shall have the meaning ascribed to such term in Section 3(a) herein.

 

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By signing below, the Optionee accepts this award, and acknowledges and agrees
that this Award is granted under and governed by the terms and conditions of the
Integrated Electrical Services, Inc. Amended and Restated 2006 Equity Incentive
Plan and the Option Award Agreement.

 

OPTIONEE:     INTEGRATED ELECTRICAL SERVICES, INC.       By:         Title:     

 

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