Exhibit 10.2


 


INCENTIVE STOCK
OPTION AGREEMENT


 


 


UNDER
THE ALBANY MOLECULAR RESEARCH, INC.


1998 STOCK OPTION
AND INCENTIVE PLAN


 


 


Name of Optionee:


Number of Option Shares:


Option Exercise Price per
Share:


[FMV
(Average of high and low sale prices on Grant Date) or 110% of FMV if a 10% Owner]


Grant Date:


Expiration Date:


 


 


Pursuant to the Albany Molecular Research, Inc.
1998 Stock Option and Incentive Plan, as amended through the date hereof (the “Plan”),
Albany Molecular Research, 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 any part of
the number of shares of Common Stock, par value $.01 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.                                       Vesting
Schedule.  No portion of this Stock
Option may be exercised until such portion shall have vested.  Except as set forth below, and subject to the
discretion of the Administrator (as defined in Section 2 of the Plan) to
accelerate the vesting schedule hereunder and the acceleration of vesting
in accordance with Sections 3(c) and 17 of the Plan, [(a) sixty percent (60%) of this Stock Option shall be
fully vested and exercisable on the third anniversary of the Grant Date, (b) eighty
percent (80%) of this Stock Option shall be fully vested and exercisable on the
fourth anniversary of the Grant Date, and (c) one hundred percent (100%)
of this Stock Option shall be fully vested and exercisable on the fifth
anniversary of the Grant Date.](1)  Once vested, 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.


 










(1)
Max. of $100,000 per yr.





















 


2.                                       Manner
of Exercise.


 


(a)                                  The
Optionee may exercise this Stock Option only in the
following manner:  from time to time on
or prior to the Expiration Date of this Stock Option, the Optionee
may give written notice to the Company of his or her election to purchase some
or all of the vested 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, valued at
Fair Market Value on the exercise date, that have been purchased by the Optionee on the open market or that have been beneficially
owned by the Optionee for at least six months, and
are not then subject to restrictions under any Company plan, if permitted by
the Administrator in its discretion; (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 purchase price, provided
that in the event the Optionee chooses to pay the
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; (iv) by the Optionee
delivering to the Company a promissory note if the Board of Directors has
expressly authorized the loan of funds to the Optionee
for the purpose of enabling or assisting the Optionee
to effect the exercise of his or her Stock Option, provided that at
least so much of the exercise price as represents the par value of the Stock
shall be paid other than with a promissory note; or (v) with the consent
of the Administrator, a combination of (i), (ii), (iii) and (iv) 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 this Stock Option under the
Plan and any subsequent resale of the shares of Stock will be in compliance
with applicable laws and regulations.  In
the event an Optionee chooses to pay the purchase
price by previously-owned shares of Stock through the attestation method
described in clause (ii) of the preceding paragraph, the number of
shares of Stock transferred to the Optionee upon
exercise of this Stock Option shall be net of the number of shares attested to.


 


(b)                                 Certificates
for the 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.


 


(c)                                  The
minimum number of shares with respect to which this Stock Option may be
exercised at any one time shall be 100 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 hereof or of the Plan, no portion of this Stock Option
shall be exercisable after the Expiration Date hereof.


 


3.                                       Termination
of Employment.  If the Optionee’s employment by the Company or a Subsidiary (as
defined in the Plan) is terminated, the period within which to exercise the
Stock 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 (12) months from the
date of death or until the Expiration Date, if earlier.


 


(b)                                 Termination
Due to Disability.  If the Optionee’s employment terminates as a result of the
inability of the Optionee, by reason of injury,
illness or other similar cause, to perform a major part of his or her duties
and responsibilities in connection with the conduct of the business and affairs
of the Company, any Option held by the Optionee shall
become fully exercisable and may thereafter be exercised by the Optionee for a period of twelve (12) months from the date
of termination or until the Expiration Date, if earlier.  The death of the Optionee
during the 12-month period provided in this Section 3(b) shall extend
such period for another twelve (12)
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 (as defined
below), any Option held by the Optionee shall
terminate immediately and be of no further force and effect.


 


For purposes of this Agreement, “Cause” shall have the meaning set
forth in any Employment Agreement by and between the Company and the Optionee, or if there is no such Employment Agreement,
termination of the Optionee’s employment for any of
the following reasons shall constitute termination for “Cause” for purposes
hereof:


 


(i)                                     dishonest statements or acts of the Optionee
with respect to the Company, any Subsidiary or any affiliate of the Company;


 





















 


(ii)                                  commission
by or indictment of the Optionee for (A) a
felony or (B) any misdemeanor involving moral turpitude, deceit,
dishonesty or fraud (“indictment,” for these purposes, meaning an indictment,
probable cause hearing or any other procedure pursuant to which an initial
determination of probable or reasonable cause with respect to such offense is
made);


 


(iii)                               commission, in the reasonable judgment of the Administrator,
of any act involving a violation of any procedure or policy of the Company;


 


(iv)                              failure
to perform to the reasonable satisfaction of the Chief Executive Officer or the
President of the Company a substantial portion of the Optionee’s
duties and responsibilities as an employee of the Company, which failure
continues, in the reasonable judgment of the Chief Executive Officer or the
President of the Company, after written notice to the Optionee
thereof and after a 30-day cure period expires;


 


(v)                                 gross negligence, willful misconduct or insubordination of
the Optionee with respect to the Company, any
Subsidiary or any affiliate of the Company; or


 


(vi)                              material
breach by the Optionee of any of the Optionee’s obligations under any agreement with the
Company, including, without limitation, that certain Employee Innovation,
Proprietary Information and Post-Employment Activity Agreement by and between
the Company and the Optionee.


 


(d)                                 Other
Termination.  If the Optionee’s employment terminates for any reason other than
those set forth in Sections 3(a), 3(b) or 3(c) of this
Agreement, and unless otherwise determined by the Committee, any Option held by
the Optionee may be exercised, to the extent
exercisable on the date of termination, for a period of three (3) 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.


 


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. 
In the event of any discrepancy or inconsistency between this Agreement
and the Plan, the terms and conditions of the Plan shall control.  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,
or by the Optionee’s legal representative or guardian
in the event of the Optionee’s incapacity.


 


6.                                       Status
of the Stock Option.  This Stock
Option is intended to qualify as an “incentive stock option” under Section 422
of the Internal Revenue Code of 1986, as amended (the “Code”), but the Company
does not represent or warrant that this Stock Option qualifies as such.  The Optionee should
consult with his or her own tax advisors regarding the tax effects of this
Stock Option and the requirements necessary to obtain favorable income tax
treatment under Section 422 of the Code, including, but not limited to,
holding period requirements.  If the Optionee intends to dispose or does dispose (whether by
sale, gift, transfer or otherwise) of any Option Shares within the one-year
period beginning on the date after the transfer of such shares to him or her,
or within the two-year period beginning on the day after the grant of this
Stock Option, he or she will notify the Company within 30 days after such
disposition.


 


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)                                  Pursuant
to Section 15 of the Plan, the Administrator may at any time amend or
cancel any outstanding portion of this Stock Option, but no such action may be
taken which adversely affects the Optionee’s rights
under this Agreement without the Optionee’s consent.


 


(d)                                 This
Agreement may be executed in one or more counterparts, each of which shall be
an original, but all of which shall together constitute one instrument.


 


 


ALBANY MOLECULAR RESEARCH, INC.


 


	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
  Name: 

  	
  Mark T. Frost

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  Chief Financial Officer