Exhibit 10.2


 





 


Keane, Inc.


 


 


Incentive Stock Option Agreement


Granted Under 2001 Stock Incentive
Plan


 


1.                                       Grant
of Option.


 


This agreement evidences
the grant by Keane, Inc., a Massachusetts corporation (the “Company”), on          
  ,      (the “Grant Date”) to                     
(the “Participant”), an employee of the Company or one of its wholly-owned
subsidiaries, as defined in Section 424(f) of the Internal Revenue Code of
1986, as amended and any regulations promulgated thereunder (the”Code”), of an
option to purchase, in whole or in part, on the terms provided herein and in
the Company’s 2001 Stock Incentive Plan (the “Plan”), a total of        shares of
common stock, $.10 par value per share, of the Company (“Common Stock”) (the “Shares”)
at $      per Share. 
Unless earlier terminated, this option shall expire on, and cannot be
exercised on or after, the tenth anniversary of the Grant Date (the “Expiration
Date”).


 


It is
intended that the option evidenced by this agreement shall be an incentive stock
option as defined in Section 422 of the Code.  For so long as the Code shall so provide,
options granted to any employee which are intended to constitute incentive
stock options shall not constitute incentive stock options to the extent that
such options, in the aggregate, become exercisable for the first time in any
one calendar year for shares of Common Stock with an aggregate fair market
value (determined as of the respective date or dates of grant) of more than
$100,000.  Any shares granted above the
$100,000 limit are considered non-qualified stock options.  Except as otherwise indicated by the context,
the term “Participant”, as used in this option, shall be deemed to include any
person who acquires the right to exercise this option validly under its terms.


 


2.                                       Vesting
Schedule.


 


 Except as otherwise provided in this
Agreement, this option shall become fully exercisable as to all of the Shares
on the fifth anniversary of the Grant Date (the “Fifth Anniversary Date”).  Notwithstanding the foregoing, if prior to
the Fifth Anniversary Date the Company determines that the cash EPS targets set
forth below have been met, and if the Board of 


 


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Directors
so concurs, then this option shall immediately become exercisable as to not
more than the number of shares set forth opposite such cash EPS target in the
table below.


 


	
  Cash EPS Target

  	
   

  	
  Number of

  Shares as to which

  Option is Exercisable

  	
   

  



 


 


[Vesting Schedule omitted for
purposes of form of option]


 


The
right of exercise shall be cumulative so that to the extent the option is not
exercised at any time to the maximum extent permissible it shall continue to be
exercisable, in whole or in part, with respect to all Shares for which it is
vested until the earlier of the Expiration Date or the termination of this
option under Section 3 hereof or the Plan.


 


3.                                       Exercise
of Option.


 


(a)                                  Form
of Exercise.  Each election to
exercise this option shall be in writing specifying the number of Shares to be
exercised, the option exercise price per Share and delivery instructions for
the Shares, signed by the Participant, and received by the Company at its
principal office, accompanied by payment in full as follows:


 


(i)                                     in
cash or by check, payable to the order of the Company; or


 


(ii)                                  by delivery of cash or a check equal to
the exercise price of the options by a creditworthy broker;


 


(iii)                               by delivery of shares of Common Stock owned by the
Participant valued at their fair market value as determined by (or in a manner
approved by) the Board in good faith, with written proof that the Common Stock
was owned by the Participant at least twelve months prior to such delivery; or


 


(iv)                              by
any combination of the above permitted forms of payment.


The Participant may
purchase less than the number of shares covered hereby, provided that no
partial exercise of this option may be for any fractional share or for fewer
than ten whole shares.


 


(b)                                 No
Special Employment Rights; Agreement Not To Compete.  Nothing contained in the Plan shall be construed
or deemed by any person under any circumstances to bind the Company to continue
the employment of the Participant for the period within which this option


 


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may be
exercised.  The Company expressly reserves
the right at any time to dismiss or otherwise terminate its relationship with a
Participant free from any claim under the Plan. 
In consideration of the benefits herein conferred, the Participant
hereby agrees and covenants with the Company that for a period of one (1) year
following any termination of his or her employment with the Company he or she
(i) will not hire, attempt to hire, solicit, or attempt to solicit to hire, or
assist another or participate in any manner in the hiring or soliciting for
hire, of any person employed by Keane within the one (1) year prior to the
termination of his or her employment; and (ii) will not “compete” with
Keane.  For purposes of the Agreement, “competing”
is defined as soliciting or doing business with, directly or indirectly, any
present or past (within the two years prior to the termination of his or her
employment) customer of Keane, or any prospective customer of Keane, with whom
he or she has had contact in connection with any business activity, but is limited
to the type of services provided by Keane to any of its customers during the
term of his or her employment.


 


(c)                                  Continuous
Relationship with the Company Required. 
Except as otherwise provided in this Section 3, this option may not
be exercised unless the Participant, at the time he or she exercises this
option, is, and has been at all times since the date of grant of this option,
an employee, officer or director of, or consultant or advisor to, the Company
or any parent or subsidiary of the Company as defined in Section 424(e) or
(f) of the Code (an “Eligible Participant”).


 


(d)                                 No
Rights As Stockholder.  No
Participant shall have any rights as a stockholder with respect to any shares
of Common Stock to be distributed with respect to this option (including,
without limitation, any rights to dividends or distributions) until becoming
the record holder of such shares. 
Notwithstanding the foregoing, in the event the Company effects a split
of the Common Stock by means of a stock dividend and the exercise price of and
the number of shares subject to this option are adjusted as of the date of the
distribution of the dividend (rather than as of the record date for such
dividend), then if the Participant exercises this option between the close of
business on the record date for such stock dividend and the close of business
on the distribution date for such stock dividend, he or she shall be entitled
to receive, on the distribution date, the stock dividend with respect to the
shares of Common Stock acquired upon such option exercise, notwithstanding the
fact that such shares were not outstanding as of the close of business on the
record date for such stock dividend.


 


(e)                                  Termination
of Relationship with the Company.  If
the Participant ceases to be an Eligible Participant for any reason, then,
except as provided in paragraphs (f) and (g) below, the right to exercise
this option shall terminate forty-five (45) days after such cessation (but in
no event after the Expiration Date), provided  that this option
shall be exercisable only to the extent that the Participant was entitled to
exercise this option on the date of such cessation.  Notwithstanding the foregoing, if the
Participant, prior to the Expiration Date, violates the non-competition or
confidentiality provisions of any employment contract, confidentiality and
nondisclosure agreement or other agreement between the Participant and the
Company, the right to exercise this option shall terminate immediately upon
written notice to the Participant from the Company describing such violation.


 


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(f)                                    Exercise
Period Upon Death or Disability.  If
the Participant dies or becomes disabled (within the meaning of Section 22(e)(3)
of the Code) prior to the Final Exercise Date while he or she is an Eligible
Participant and the Company has not terminated such relationship for “cause” as
specified in paragraph (g) below, this option shall be exercisable, within the
period of one year following the date of death or disability of the Participant
by the Participant, provided  that this option shall be
exercisable only to the extent that this option was exercisable by the
Participant on the date of his or her death or disability, and further provided
that this option shall not be exercisable after the Expiration Date.


 


(g)                                 Discharge
for Cause.  If the Participant, prior
to the Expiration Date, is discharged by the Company for “cause” (as defined
below), the right to exercise this option shall terminate immediately upon the
effective date of such discharge. “Cause” shall mean misconduct by the
Participant or willful failure by the Participant to perform his or her
responsibilities to the Company in the best interests of the Company
(including, but not limited to, breach by the Participant of any provision of
any employment, consulting, advisory, nondisclosure, non-competition or other
similar agreement between the Participant and the Company), as determined by
the Company, which determination shall be conclusive.  The Participant shall be considered to have
been discharged for “Cause” if the Company determines, within 30 days after the
Participant’s resignation, that discharge for cause was warranted.


 


(h)                                 Changes
in Capitalization.  In the event of
any stock split, reverse stock split, stock dividend, recapitalization,
combination of shares, reclassification of shares, spin-off or other similar
change in capitalization or event, or any distribution to holders of Common
Stock other than a normal cash dividend, in each case other than an Acquisition
Event (as defined in the Plan), the number and class of securities and exercise
price per share subject to this option shall be appropriately adjusted by the
Company to the extent the Board shall determine, in good faith, that such an
adjustment (or substitution) is necessary and appropriate.


 


4.                                       Withholding.  No Shares will be issued pursuant to the
exercise of this option unless and until the Participant pays to the Company,
or makes provision satisfactory to the Company for payment of, any federal, state
or local withholding taxes required by law to be withheld in respect of this
option.


 


5.                                       Nontransferability
of Option.  This option may not be
sold, assigned, transferred, pledged or otherwise encumbered by the
Participant, either voluntarily or by operation of law, except by will or the
laws of descent and distribution, and, during the lifetime of the Participant,
this option shall be exercisable only by the Participant.


 


6.                                       Disqualifying
Disposition.  If the Participant
disposes of Shares acquired upon exercise of this option within two years from
the date of grant of the option or one year after such Shares were acquired
pursuant to exercise of this option, the Participant shall notify the Company
in writing of such disposition within 30 days of such disposition.


 


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7.                                       Provisions
of the Plan.   This option is subject
to the provisions of the Plan, a copy of which is furnished to the Participant
with this option.


 


8.                                       Notice.  All notices required or permitted hereunder
shall be in writing and deemed effectively given upon personal delivery or upon
deposit in the United States Post Office, by registered or certified mail,
postage prepaid, addressed to the other party hereto at the address shown
beneath his or her or its respective signature to this Agreement, or at such
other address or addresses as either party shall designate to the other in
accordance with this Section 13.


 


9.                                       Pronouns.  Whenever the context may require, any
pronouns used in this Agreement shall include the corresponding masculine,
feminine or neuter forms, and the singular form of nouns and pronouns shall
include the plural, and vice versa.


 


10.                                 Entire
Agreement.  This Agreement
constitutes the entire agreement between the parties, and supercedes all prior
agreements and understanding, relating to the subject matter of this Agreement.


 


11.                                 Amendment.  This Agreement may be amended or modified
only by a written instrument executed by both the Company and the Employee.


 


12.                                 Governing
Law.  This Agreement shall be
governed by and enforced in accordance with the internal laws of the
Commonwealth of Massachusetts, without giving effect to the principles of
conflicts of law thereof.


 


IN
WITNESS WHEREOF, the Company has caused this option to be executed under its
corporate seal by its duly authorized officer. 
This option shall take effect as a sealed instrument.


 


 


	
   

  	
  KEANE, INC.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name/Title

  



 


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PARTICIPANT’S
ACCEPTANCE


 


The
undersigned hereby accepts the foregoing option and agrees to the terms and
conditions thereof.  The undersigned
hereby acknowledges receipt of a copy of the Company’s 2001 Stock Incentive
Plan.


 


 


	
   

  	
  PARTICIPANT:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name (please
  print):

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address: 

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
						



 


 


I have
read the terms and conditions of the foregoing option and choose NOT TO
ACCEPT the option agreement.


 


	
   

  	
  PARTICIPANT:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name (please
  print):

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address: 

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
						



 


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