**Exhibit 10.49**

 

**ARGYLESECURITY, INC.**

 

**2007OMNIBUS SECURITIES AND INCENTIVE PLAN**

 

**STOCKOPTION AGREEMENT**

 

**INCENTIVESTOCK OPTION**

** **

THISAGREEMENT effective as of                                       ,200   , by and between Argyle Security, Inc., a Delaware corporation(the “Company”), and                                                                   (the “Optionee”).

 

WITNESSETH:

 

WHEREAS,the Company has adopted the Argyle Security, Inc. 2007 Omnibus Securitiesand Incentive Plan (the “Plan”) for the benefit of its employees,nonemployee directors and consultants and the employees, nonemployee directorsand consultants of its affiliates, and

 

WHEREAS,the Committee has authorized the grant to the Optionee of an Option under thePlan, on the terms and conditions set forth in the Plan and as hereinafterprovided,

 

NOW,THEREFORE, in consideration of the premises contained herein, the Company andthe Optionee hereby agree as follows:

 

1.             Definitions.

 

Terms used in this Agreement which are defined in the Planshall have the same meaning as set forth in the Plan.

 

2.             Grantof Option.

 

The Committee hereby grants to the Optionee an optionto purchase **[insert**# **of shares]**shares of the Company’s CommonStock (“Shares”) for an Option price per Share equal to [**insert price**]****(notless than the Fair Market Value of a Share on the date of this Agreement andnot less than one hundred ten percent (110%) of the Fair Market Value of aShare if the Optionee is a ten percent (10%) or greater shareholder of theCompany as described in Section 7.3 of the Plan) (the “Option”).The Option is intended by the Committee to be an Incentive Stock Option and theprovisions hereof shall be interpreted on a basis consistent with such intent.

 

3.             OptionTerms and Exercise Period.

 

## (a)           The Option shall be exercised, andpayment by the Optionee of the Option price shall be made, pursuant to theterms of the Plan.

##  

## (b)           All or any part of the Option may beexercised by the Optionee no later than ten (10) years (five (5) yearsif the Optionee is a ten percent (10%) or greater shareholder of

##  

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## 

##  

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## the Company as described in Section 7.3 of thePlan) after the date of this Agreement.

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## (c)           Except as otherwise provided in Section 10,this Agreement and the Option shall terminate on the earlier of (i) the(10th) anniversary (no later than the tenth anniversary) (the fifth (5th)anniversary if the Optionee is a ten percent (10%) or greater shareholder ofthe Company as described in Section 7.3 of the Plan) of the date of thisAgreement, or (ii) the date the Option is fully exercised.

 

4.             Vesting.

 

Optionsto purchase one-third of the Shares (rounded to the nearest whole Share, exceptfor the final vesting date, which relates to all remaining unvested Shares)shall vest and become exercisable on each of the following dates:

 

December 31,2008

 

December 31,2009

 

December 31,2010

 

Notwithstanding the above schedule, the Optionee shallbe one hundred percent (100%) vested in the Option if the Optionee’s employmentwith the Company shall terminate on account of the Optionee’s (a) Totaland Permanent Disability, (b) death or (c) retirement upon or afterattaining age sixty-five (65) with at least five (5) full years of servicefor the Company and/or an Affiliate. The Optionee shall forfeit any unvested portionof the Option upon termination of employment with the Company for any reasonother than the Optionee’s Total and Permanent Disability, death or retirementupon or after attaining age sixty-five (65).

 

5.             Terminationof Employment.

 

Sections 6.2, 6.4 and 6.5 ofthe Plan shall control.

 

6.             Restrictionson Transfer of Option.

 

This Agreement and the Option shall not betransferable otherwise than by will or by the laws of descent and distribution,and the Option shall be exercisable, during the Optionee’s lifetime, solely bythe Optionee, except on account of the Optionee’s Total and PermanentDisability or death.

 

7.             Exerciseof Option.

 

## (a)           The Option shall become exercisableat such time as shall be provided herein or in the Plan and shall be exercisableby written notice of such exercise, in the form prescribed by the Committee, tothe Secretary of the Company, at its principal office. The notice shall specifythe number of Shares for which the Option is being exercised.

##  

## (b)           Shares purchased pursuant to theOption shall be paid for in full at the time of such purchase in cash, inShares, including Shares acquired pursuant to the Plan, or part in cash andpart in Shares. Shares transferred in payment of the Option price shall bevalued as of

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## 

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## the date of transfer based on their Fair Market Value.

 

8.             Regulationby the Committee.

 

This Agreement and the Option shall be subject to anyadministrative procedures and rules as the Committee shall adopt. Alldecisions of the Committee upon any question arising under the Plan or underthis Agreement, shall be conclusive and binding upon the Optionee and anyperson or persons to whom any portion of the Option has been transferred bywill or by the laws of descent and distribution.

 

9.             Rightsas a Shareholder.

 

The Optionee shall have no rights as a shareholderwith respect to Shares subject to the Option until certificates for Shares ofCommon Stock are issued to the Optionee.

 

10.           Changeof Control.

 

Notwithstanding the vesting requirements contained in Section 4,upon a Change of Control, in the sole discretion of the Committee, either (a) theOption shall automatically become fully vested and exercisable as of the dateof such Change of Control, or (b) the Option shall terminate and theCompany shall, within 30 days, make a cash payment to the Optionee equalto the product of (i) the number of Shares set forth in Section 1,multiplied by (ii) the excess of the Fair Market Value of a Share ofCommon Stock immediately prior to the Change of Control over the Option price.If the Company fails to make the payment described in clause (b) of theimmediately preceding sentence within days following the Change of Control, theOption shall automatically become fully vested and exercisable as of the nextday.

 

For purposes of this Agreement, the term “Change ofControl” shall mean (i) for an Optionee who is a party to anemployment agreement with the Company or an Affiliate which agreement providesfor a definition of “Change of Control” therein, “Change of Control”shall have the same meaning as provided for in such agreement, or (ii) foran Optionee who is not a party to such an agreement, “Change of Control”shall mean the earliest of the following to occur:

 

## (a)           The public announcement by theCompany or any person (other than the Company, any subsidiary of the Company orany employee benefit plan of the Company or of any subsidiary of the Company) (“Person”)that such Person, who or which, together with all “affiliates” and “associates”(within the meanings of such terms under Rule 12b-2 of the Exchange Act)of such Person, shall be the beneficial owner of (fifty percent (50%) or moreof the Company’s voting stock then outstanding;

##  

## (b)           The commencement of, or after thefirst public announcement of any Person to commence, a tender or exchange offerthe consummation of which would result in any Person becoming the beneficialowner of the Company’s voting stock aggregating fifty percent (50%) or more ofthe Company’s then outstanding voting stock;

##  

## (c)           The announcement of any transactionrelating to the Company required to be described pursuant to the requirementsof Item 6(e) of Schedule 14A of Regulation 14A of the

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## 

##  

##  

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## Securities and Exchange Commission under the ExchangeAct;

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## (d)           A proposed change in the constituencyof the Board such that, during any period of two (2) consecutive years,individuals who at the beginning of such period constitute the Board cease forany reason to constitute at least a majority thereof, unless the election ornomination for election by the shareholders of the Company of each new directorwas approved by a vote of at least two-thirds (2/3) of the directors then stillin office who were members of the Board at the beginning of the period;

##  

## (e)           The Company enters into an agreementof merger, consolidation, share exchange or similar transaction with any othercorporation other than a transaction which would result in the Company’s votingstock outstanding immediately prior to the consummation of such transactioncontinuing to represent (either by remaining outstanding or by being convertedinto voting stock of the surviving entity) at least two-thirds (2/3) of thecombined voting power of the Company’s or such surviving entity’s outstandingvoting stock immediately after such transaction;

##  

## (f)            The Board approves a plan ofliquidation or dissolution of the Company or an agreement for the sale ordisposition by the Company (in one transaction or a series of transactions) ofall or substantially all of the Company’s assets to a person or entity which isnot an affiliate of the Company; or

##  

## (g)           Any other event which shall be deemedby a majority of the members of the Board to constitute a “Change of Control.”

##  

Notwithstanding anythingto the contrary contained in this Section 10, the Board is herebyauthorized to make any modifications to the above “Change of Control”definition as it determines in its sole discretion to be necessary for purposesof compliance with Section 409A of the Code, to the extent applicable.

 

11.           Reservationof Shares.

 

With respect to the Option, the Company hereby agreesto at all times reserve for issuance and/or delivery upon payment by theOptionee of the Option price, such number of Shares as shall be required forissuance and/or delivery upon such payment pursuant to the Option.

 

12.           Deliveryof Share Certificates.

 

Within a reasonable time after the exercise of theOption, the Company shall cause to be delivered to the Optionee, his or herlegal representative or his or her beneficiary, a certificate for the Sharespurchased pursuant to the exercise of the Option.

 

13.           Withholding.

 

In the event the Optionee elects to exercise theOption (or any part thereof), if the Company or an Affiliate shall be requiredto withhold any amounts by reason of any federal, state or local tax rules orregulations in respect of the issuance of Shares to the Optionee, the

 

 

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Company or Affiliate shall be entitled to deduct andwithhold such amounts.

 

14.           Amendment.

 

The Committee may amend this Agreement at any time andfrom time to time; provided, however, that no amendment of thisAgreement that would materially and adversely impair the Optionee’s rights orentitlements with respect to the Option shall be effective without the priorwritten consent of the Optionee (unless such amendment is required in order tocause the Award hereunder to qualify as “performance-based” compensation withinthe meaning of Section 162 (m) of the Code and applicableinterpretive authority thereunder).

 

15.           PlanTerms.

 

Theterms of the Plan are hereby incorporated herein by reference.

 

16.           EffectiveDate of Grant.

 

The Option shall be effective as of the date firstwritten above.

 

17.           OptioneeAcknowledgment.

 

By executing this Agreement, the Optionee herebyacknowledges that he or she has received and read the Plan and this Agreementand that he or she agrees to be bound by all of the terms of both the Plan andthis Agreement.

 
| ATTEST: |   | ARGYLE SECURITY, INC. |
|---------|--------|-----------------------|
|    |   |                  |
|    |   |                  |
|    |   |                  |
|    |   |                  |
|    |   | By:                   |   |
|    |   |                  | Donald F. Neville |
|    |   |                  | Chief Financial Officer |
|    |   |                  |   |
|    |   |                  |   |
|    |   |                  |   |
|    |   |                  |   | , Optionee |
|    |   |                  | Name**:** |

 

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** **

**ARGYLESECURITY, INC.**

** **

**2007OMNIBUS SECURITIES AND INCENTIVE PLAN**

** **

**STOCKOPTION AGREEMENT**

** **

**EMPLOYEENON-QUALIFIED STOCK OPTION**

** **

THIS AGREEMENT effectiveas of                              ,200  , by and between Argyle Security, Inc., a Delaware****corporation (the “Company”), and                               (the “Optionee”).

 

WITNESSETH:

 

WHEREAS, the Company hasadopted the Argyle Security, Inc 2007 Omnibus Securities and Incentive Plan(the “Plan”) for the benefit of its employees, nonemployee directors andconsultants and the employees, nonemployee directors and consultants of itsaffiliates, and

 

WHEREAS, the Committeehas authorized the grant to the Optionee of an Option under the Plan, on theterms and conditions set forth in the Plan and as hereinafter provided,

 

NOW, THEREFORE, inconsideration of the premises contained herein, the Company and the Optioneehereby agree as follows:

 

1.                                       Definitions.

 

Termsused in this Agreement which are defined in the Plan shall have the samemeaning as set forth in the Plan.

 

2.                                       Grant of Option.

 

TheCommittee hereby grants to the Optionee an option to purchase **[insert**# **ofshares]**shares of the Company’s Common Stock (“Shares”) foran Option price per Share equal to **[insertprice]** (not less than theFair Market Value of a Share on the date of this Agreement) (the “Option”).The Option is intended by the Committee to be a Non-Qualified Stock Option andthe provisions hereof shall be interpreted on a basis consistent with suchintent.

 

3.                                       Option Terms and Exercise Period.

 

## (a)                                  The Option shall be exercised, andpayment by the Optionee of the Option price shall be made, pursuant to theterms of the Plan.

##  

## (b)                                 All or any part of the Option may beexercised by the Optionee no later than the tenth (10th) anniversary of thedate of this Agreement.

##  

## (c)                                  Except as otherwise provided in Section 10,this Agreement and the Option shall terminate on the earlier of (i) thetenth (10th) anniversary of the date of this Agreement or (ii) the datethe Option is fully exercised.

 

# 

 

4.                                       Vesting.

 

Optionsto purchase one-third of the Shares (rounded to the nearest whole Share, exceptfor the final vesting date, which relates to all remaining unvested Shares)shall vest and become exercisable on each of the following dates:

 

December 31,2008

December 31,2009

December 31,2010

 

Notwithstandingthe above schedule, the Optionee shall be one hundred percent (100%) vested inthe Option if the Optionee’s employment with the Company shall terminate onaccount of the Optionee’s (a) Total and Permanent Disability, (b) deathor (c) retirement upon or after attaining age sixty-five (65) with atleast five (5) full years of service for the Company and/or an Affiliate.The Optionee shall forfeit any unvested portion of the Option upon terminationof employment with the Company for any reason other than the Optionee’s Totaland Permanent Disability, death or retirement upon or after attaining agesixty-five (65).

 

5.                                       Termination of Employment.

 

Sections6.2., 6.4 and 6.5 of the Plan shall control.

 

6.                                       Restrictions on Transfer of Option.

 

ThisAgreement and the Option shall not be transferable otherwise than (a) bywill or by the laws of descent and distribution or (b) by gift to anyFamily Member of the Optionee, and the Option shall be exercisable, during theOptionee’s lifetime, solely by the Optionee, except on account of the Optionee’sTotal and Permanent Disability or death, and solely by the transferee in thecase of a transfer by gift to a Family Member of the Optionee.

 

7.                                       Exercise of Option.

 

## (a)                                  The Option shall become exercisable atsuch time as shall be provided herein or in the Plan and shall be exercisableby written notice of such exercise, in the form prescribed by the Committee, tothe Secretary of the Company, at its principal office. The notice shall specifythe number of Shares for which the Option is being exercised.

##  

## (b)                                 Shares purchased pursuant to the Optionshall be paid for in full at the time of such purchase in cash, in Shares,including Shares acquired pursuant to the Plan, or part in cash and part inShares. Shares transferred in payment of the Option price shall be valued as ofthe date of transfer based on their Fair Market Value.

##  

8.                                       Regulation by the Committee.

 

ThisAgreement and the Option shall be subject to the administrative procedures and rules asthe Committee shall adopt. All decisions of the Committee upon any questionarising under the Plan or under this Agreement, shall be conclusive and bindingupon the 

 

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Optionee and any person or persons to whom any portionof the Option has been transferred by will, by the laws of descent anddistribution or by gift to a Family Member of the Optionee.

 

9.                                       Rights as a Shareholder.

 

TheOptionee shall have no rights as a shareholder with respect to Shares subjectto the Option until certificates for Shares of Common Stock are issued to theOptionee.

 

10.                                 Change of Control.

 

Notwithstandingthe vesting requirements contained in Section 4, upon a Change of Control,in the sole discretion of the Committee, either (a) the Option shallautomatically become fully vested and exercisable as of the date of such Changeof Control, or (b) the Option shall terminate and the Company shall,within 30 days, make a cash payment to the Optionee equal to the product of (i) thenumber of Shares set forth in Section 1, multiplied by (ii) theexcess of the Fair Market Value of a Share of Common Stock immediately prior tothe Change of Control over the Option price. If the Company fails to make thepayment described in clause (b) of the immediately preceding sentencewithin 30 days following the Change of Control, the Option shall automaticallybecome fully vested and exercisable as of the next day.

 

Forpurposes of this Agreement, the term “Change of Control” shall mean (i) foran Optionee who is a party to an employment agreement with the Company or anAffiliate which agreement provides for a definition of “Change of Control”therein, “Change of Control” shall have the same meaning as provided forin such agreement, or (ii) for an Optionee who is not a party to such anagreement, “Change of Control” shall mean the earliest of the followingto occur:

 

## (a)                                  The public announcement by the Company orany person (other than the Company, any subsidiary of the Company or anyemployee benefit plan of the Company or of any subsidiary of the Company) (“Person”)that such Person, who or which, together with all “affiliates” and “associates”(within the meanings of such terms under Rule 12b-2 of the Exchange Act)of such Person, shall be the beneficial owner of fifty percent (50%) or more ofthe Company’s voting stock then outstanding;

##  

## (b)                                 The commencement of, or after the firstpublic announcement of any Person to commence, a tender or exchange offer theconsummation of which would result in any Person becoming the beneficial ownerof the Company’s voting stock aggregating fifty****percent(50%) or more of the Company’s then outstanding voting stock;

##  

## (c)                                  The announcement of any transactionrelating to the Company required to be described pursuant to the requirementsof Item 6(e) of Schedule 14A of Regulation 14A of the Securities andExchange Commission under the Exchange Act;

##  

## (d)                                 A proposed change in the constituency ofthe Board such that, during any period of two (2) consecutive years,individuals who at the beginning of such period constitute the Board cease forany reason to constitute at least a majority thereof, unless the election ornomination for election by the shareholders of the Company of each new directorwas approved 

 

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## by a vote of at least two-thirds (2/3) of the directors then still inoffice who were members of the Board at the beginning of the period;

##  

## (e)                                  The Company enters into an agreement ofmerger, consolidation, share exchange or similar transaction with any othercorporation other than a transaction which would result in the Company’s votingstock outstanding immediately prior to the consummation of such transactioncontinuing to represent (either by remaining outstanding or by being convertedinto voting stock of the surviving entity) at least two-thirds (2/3) of thecombined voting power of the Company’s or such surviving entity’s outstandingvoting stock immediately after such transaction;

##  

## (f)                                    The Board approves a plan of liquidationor dissolution of the Company or an agreement for the sale or disposition bythe Company (in one transaction or a series of transactions) of all orsubstantially all of the Company’s assets to a person or entity which is not anaffiliate of the Company; or

##  

## (g)                                 Any other event which shall be deemed bya majority of the members of the Board to constitute a “Change of Control.”

##  

Notwithstanding anythingto the contrary contained in this Section 10, the Board is hereby authorizedto make any modifications to the above “Change of Control” definition as itdetermines in its sole discretion to be necessary for purposes of compliancewith Section 409A of the Code, to the extent applicable.

 

11.                                 Reservation of Shares.

 

With respectto the Option, the Company hereby agrees to at all times reserve for issuanceand/or delivery upon payment by the Optionee of the Option price, such numberof Shares as shall be required for issuance and/or delivery upon such paymentpursuant to the Option.

 

12.                                 Delivery of Share Certificates.

 

Withina reasonable time after the exercise of the Option the Company shall cause tobe delivered to the Optionee, his or her legal representative or his or herbeneficiary, a certificate for the Shares purchased pursuant to the exercise ofthe Option.

 

13.                                 Withholding.

 

In theevent the Optionee elects to exercise the Option (or any part thereof) , if theCompany or an Affiliate shall be required to withhold any amounts by reason ofany federal, state or local tax rules or regulations in respect of theissuance of Shares to the Optionee, the Company or Affiliate shall be entitledto deduct and withhold such amounts.

 

14.                                 Amendment.

 

TheCommittee may amend this Agreement at any time and from time to time; provided,however, that no amendment of this Agreement that would materially andadversely 

 

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impair the Optionee’s rights or entitlements withrespect to the Option shall be effective without the prior written consent ofthe Optionee (unless such amendment is required in order to cause the Awardhereunder to qualify as “performance-based” compensation within the meaning of Section 162(m) of the Code and applicable interpretive authority thereunder).

 

15.                                 Plan Terms.

 

Theterms of the Plan are hereby incorporated herein by reference.

 

16.                                 Effective Date of Grant.

 

TheOption shall be effective as of the date first written above.

 

17.                                 Optionee Acknowledgment.

 

Byexecuting this Agreement, the Optionee hereby acknowledges that he or she hasreceived and read the Plan and this Agreement and that he or she agrees to bebound by all of the terms of both the Plan and this Agreement.

 
| ATTEST:  |   | ARGYLE SECURITY, INC.   |
|----------|--------|-------------------------|
|     |   |                    |
|     |   |                    |
|     |   | By:                     |   |
|     |   |                    |
|     |   | Donald F. Neville       |
|     |   |                    |
| WITNESS: |   | Chief Financial Officer |
|     |   |                    |
|     |   |                    |
|     |   |                    |
|     |   |                    |
|     |   |                    |
|     |   |                    | , Optionee |
|     |   | **[**Name**]**          |
|          |        |                         |  |  |

 

 

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