**Exhibit 10.2**

 

INCENTIVE STOCKOPTION AGREEMENT

 

 

UNDERTHE ALBANY MOLECULAR RESEARCH, INC.

1998 STOCK OPTIONAND INCENTIVE PLAN

 

 

Name of Optionee:

Number of Option Shares:

Option Exercise Price perShare:

*[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”) topurchase on or prior to the Expiration Date specified above all or any part ofthe 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 specifiedabove subject to the terms and conditions set forth herein and in the Plan.

 

1.                                       VestingSchedule.  No portion of this StockOption may be exercised until such portion shall have vested.  Except as set forth below, and subject to thediscretion of the Administrator (as defined in Section 2 of the Plan) toaccelerate the vesting schedule hereunder and the acceleration of vestingin accordance with Sections 3(c) and 17 of the Plan, **[**(a) sixty percent (60%) of this Stock Option shall befully vested and exercisable on the third anniversary of the Grant Date, (b) eightypercent (80%) of this Stock Option shall be fully vested and exercisable on thefourth anniversary of the Grant Date, and (c) one hundred percent (100%)of this Stock Option shall be fully vested and exercisable on the fifthanniversary of the Grant Date.**]**(1)  Once vested, this Stock Option shall continueto be exercisable at any time or times prior to the close of business on theExpiration Date, subject to the provisions hereof and of the Plan.

 

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

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2.                                       Mannerof Exercise.

 

(a)                                  TheOptionee may exercise this Stock Option only in thefollowing manner:  from time to time onor prior to the Expiration Date of this Stock Option, the Optioneemay give written notice to the Company of his or her election to purchase someor all of the vested Option Shares purchasable at the time of such notice.  This notice shall specify the number ofOption Shares to be purchased.

 

Payment of the purchaseprice for the Option Shares may be made by one or more of the followingmethods:  (i) in cash, by certifiedor bank check or other instrument acceptable to the Administrator; (ii) throughthe delivery (or attestation to the ownership) of shares of Stock, valued atFair Market Value on the exercise date, that have been purchased by the Optionee on the open market or that have been beneficiallyowned by the Optionee for at least six months, andare not then subject to restrictions under any Company plan, if permitted bythe Administrator in its discretion; (iii) by the Optioneedelivering to the Company a properly executed exercise notice together withirrevocable instructions to a broker to promptly deliver to the Company cash ora check payable and acceptable to the Company to pay the purchase price, providedthat in the event the Optionee chooses to pay thepurchase price as so provided, the Optionee and thebroker shall comply with such procedures and enter into such agreements ofindemnity and other agreements as the Administrator shall prescribe as acondition of such payment procedure; (iv) by the Optioneedelivering to the Company a promissory note if the Board of Directors hasexpressly authorized the loan of funds to the Optioneefor the purpose of enabling or assisting the Optioneeto effect the exercise of his or her Stock Option, provided that atleast so much of the exercise price as represents the par value of the Stockshall be paid other than with a promissory note; or (v) with the consentof the Administrator, a combination of (i), (ii), (iii) and (iv) above.  Payment instruments will be received subjectto collection.

 

The delivery ofcertificates representing the Option Shares will be contingent upon the Company’sreceipt from the Optionee of full payment for theOption Shares, as set forth above and any agreement, statement or otherevidence that the Company may require to satisfy itself that the issuance ofStock to be purchased pursuant to the exercise of this Stock Option under thePlan and any subsequent resale of the shares of Stock will be in compliancewith applicable laws and regulations.  Inthe event an Optionee chooses to pay the purchaseprice by previously-owned shares of Stock through the attestation methoddescribed in clause (ii) of the preceding paragraph, the number ofshares of Stock transferred to the Optionee uponexercise of this Stock Option shall be net of the number of shares attested to.

 

(b)                                 Certificatesfor the shares of Stock purchased upon exercise of this Stock Option shall beissued and delivered to the Optionee upon complianceto the satisfaction of the Administrator with all requirements under applicablelaws or regulations in connection with such issuance and with the requirementshereof and of the Plan.  Thedetermination of the Administrator as to such compliance shall be final andbinding on the Optionee.  The Optionee shallnot be deemed to be the holder of, or to have any of the rights of a holderwith respect to, 

 

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any shares of Stock subject tothis Stock Option unless and until this Stock Option shall have been exercisedpursuant to the terms hereof, the Company shall have issued and delivered theshares to the Optionee, and the Optionee’sname shall have been entered as the stockholder of record on the books of theCompany.  Thereupon, the Optionee shall have full voting, dividend and otherownership rights with respect to such shares of Stock.

 

(c)                                  Theminimum number of shares with respect to which this Stock Option may beexercised at any one time shall be 100 shares, unless the number of shares withrespect to which this Stock Option is being exercised is the total number ofshares subject to exercise under this Stock Option at the time.

 

(d)                                 Notwithstandingany other provision hereof or of the Plan, no portion of this Stock Optionshall be exercisable after the Expiration Date hereof.

 

3.                                       Terminationof Employment.  If the Optionee’s employment by the Company or a Subsidiary (asdefined in the Plan) is terminated, the period within which to exercise theStock Option may be subject to earlier termination as set forth below.

 

(a)                                  TerminationDue to Death.  If the Optionee’s employment terminates by reason of death, anyOption held by the Optionee shall become fullyexercisable and may thereafter be exercised by the Optionee’slegal representative or legatee for a period of twelve (12) months from thedate of death or until the Expiration Date, if earlier.

 

(b)                                 TerminationDue to Disability.  If the Optionee’s employment terminates as a result of theinability of the Optionee, by reason of injury,illness or other similar cause, to perform a major part of his or her dutiesand responsibilities in connection with the conduct of the business and affairsof the Company, any Option held by the Optionee shallbecome fully exercisable and may thereafter be exercised by the Optionee for a period of twelve (12) months from the dateof termination or until the Expiration Date, if earlier.  The death of the Optioneeduring the 12-month period provided in this Section 3(b) shall extendsuch period for another****twelve (12)months from the date of death or until the Expiration Date, if earlier.

 

(c)                                  Terminationfor Cause.  If the Optionee’s employment terminates for Cause (as definedbelow), any Option held by the Optionee shallterminate immediately and be of no further force and effect.

 

For purposes of this Agreement, “Cause” shall have the meaning setforth 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 ofthe following reasons shall constitute termination for “Cause” for purposeshereof:

 

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

 

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(ii)                                  commissionby or indictment of the Optionee for (A) afelony 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 initialdetermination of probable or reasonable cause with respect to such offense ismade);

 

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

 

(iv)                              failureto perform to the reasonable satisfaction of the Chief Executive Officer or thePresident of the Company a substantial portion of the Optionee’sduties and responsibilities as an employee of the Company, which failurecontinues, in the reasonable judgment of the Chief Executive Officer or thePresident of the Company, after written notice to the Optioneethereof and after a 30-day cure period expires;

 

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

 

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

 

(d)                                 OtherTermination.  If the Optionee’s employment terminates for any reason other thanthose set forth in Sections 3(a), 3(b) or 3(c) of thisAgreement, and unless otherwise determined by the Committee, any Option held bythe Optionee may be exercised, to the extentexercisable on the date of termination, for a period of three (3) monthsfrom the date of termination or until the Expiration Date, if earlier.  Any Option that is not exercisable at suchtime shall terminate immediately and be of no further force or effect.

 

The Administrator’s determination of the reason fortermination of the Optionee’s employment shall beconclusive and binding on the Optionee and his or herrepresentatives or legatees.

 

4.                                       Incorporationof Plan.  Notwithstanding anythingherein to the contrary, this Stock Option shall be subject to and governed byall the terms and conditions of the Plan. In the event of any discrepancy or inconsistency between this Agreementand the Plan, the terms and conditions of the Plan shall control.  Capitalized terms in this Agreement shallhave the meaning specified in the Plan, unless a different meaning is specifiedherein.

 

5.                                       Transferability.  This Agreement is personal to the Optionee, is non-assignable and is not transferable in anymanner, by operation of law or otherwise, other than by will or the laws of 

 

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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 guardianin the event of the Optionee’s incapacity.

 

6.                                       Statusof the Stock Option.  This StockOption is intended to qualify as an “incentive stock option” under Section 422of the Internal Revenue Code of 1986, as amended (the “Code”), but the Companydoes not represent or warrant that this Stock Option qualifies as such.  The Optionee shouldconsult with his or her own tax advisors regarding the tax effects of thisStock Option and the requirements necessary to obtain favorable income taxtreatment under Section 422 of the Code, including, but not limited to,holding period requirements.  If the Optionee intends to dispose or does dispose (whether bysale, gift, transfer or otherwise) of any Option Shares within the one-yearperiod 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 thisStock Option, he or she will notify the Company within 30 days after suchdisposition.

 

7.                                       Miscellaneous.

 

(a)                                  Noticehereunder shall be given to the Company at its principal place of business, andshall be given to the Optionee at the address setforth below, or in either case at such other address as one party maysubsequently furnish to the other party in writing.

 

(b)                                 ThisStock Option does not confer upon the Optionee anyrights with respect to continuance of employment by the Company or anySubsidiary.

 

(c)                                  Pursuantto Section 15 of the Plan, the Administrator may at any time amend orcancel any outstanding portion of this Stock Option, but no such action may betaken which adversely affects the Optionee’s rightsunder this Agreement without the Optionee’s consent.

 

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

 

 

ALBANY MOLECULAR RESEARCH, INC.

 
| By:    |                    |   |
|--------|-------------------------|--------|
|   |                    |
| Name:  | Mark T. Frost           |   |
|   |                    |   |
| Title: | Chief Financial Officer |   |
|        |                         |        |  |

 

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