**Exhibit 10.2**

 

**NICINC. 2006 AMENDED AND RESTATEDSTOCK OPTION AND INCENTIVE PLAN**

 

**StockOption Agreement**

 

# **1.****            ****Grant of Option.**NIC Inc., a Colorado corporation (the “Company”),hereby grants to the Optionee named in the Certificate of Stock Option Grant(the “Certificate”), an option to purchase (the “Option”) the total number ofshares subject to the Option (the “Shares”) set forth in the Certificate at theGrant Price per share set forth in the Certificate subject to the terms andprovisions of this Stock Option Agreement (the “Agreement”) and of theCertificate and the NIC Inc. 2006 Amended and Restated Stock Option andIncentive Plan (the “Plan”), which are incorporated herein by reference. Unlessotherwise defined herein, the terms defined in the Plan shall have the samedefined meanings in this Agreement. By accepting the Option, the Optionee (andany person to whom the Option is transferred) acknowledges that the Plan hasbeen made available to him or her.

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If designated in theCertificate as an Incentive Stock Option, the Option is intended to qualify asan Incentive Stock Option as defined in Code Section 422. Nevertheless, to theextent that it exceeds the $100,000 rule of Code Section 422(d), the Optionshall be treated as a Non-Qualified Stock Option. If designated in theCertificate as a Non-Qualified Stock Option, the Option is not intended toqualify as an Incentive Stock Option under Code Section 422.

 

The Company seeks toprovide a means by which the Company, through the grant of the Option to theOptionee may retain the Optionee’s services and motivate the Optionee to exerthis or her best efforts on behalf of the Company and any Affiliate.

 

# **2.****            ****Terms and Conditions.**

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## **(a)****          ****Grant Expiration Date.**The Option shall expire on the Grant ExpirationDate provided in the Certificate. The Optionee is responsible for taking anyand all actions as may be required to exercise the Option in a timely manner,and for properly executing any documents as may be required for the exercise ofthe Option in accordance with such rules and procedures established from timeto time under the Plan. The Company has no duty to notify the Optionee (or anyperson to whom the Option is transferred) of the expiration of the Option. Byaccepting the Option, the Optionee (and any person to whom the Option istransferred) acknowledges that the information regarding the procedures andrequirements for the exercise of the Option has been made available to him orher.

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## **(b)****          ****Exercise of Option DuringContinuous Employment.**Subject tothe provisions of this Agreement, the Option may be exercised by the Optioneein installments as provided in the Certificate, rounded to the next lowestinteger in the case of any fractional share.

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To the extent notexercised, an installment shall accumulate and be exercisable, in whole or inpart, in any subsequent period but not later than the Grant Expiration Dateprovided in Section 2(a) of this Agreement. When the right to exercise anyinstallment accrues, the Shares included in that installment may be purchasedat that time or from

 

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time thereafterduring the Option period ending on the Grant Expiration Date provided inSection 2(a) of this Agreement.

 

An exercise of any partof the Option shall be accompanied by a written notice to the Company asprovided in Section 5 of this Agreement and specifying the number of Shares asto which the Option is being exercised.

 

## **(c)****          ****Exercise Upon Termination ofEmployment or Relationship as a Director or Consultant.**

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*Death.*In the event that the Optionee’sContinuous Status as an Employee, Director or Consultant terminates due to hisor her death, the Option may be exercised by the Optionee’s estate or by anyother person who acquired the Option by reason of the death of the Optioneewithin the 12 months immediately following his or her death and to the extentthat the Optionee was entitled to exercise the Option at the date of his or herdeath; provided, however, that the Option may not be exercised after the GrantExpiration Date provided in Section 2(a) of this Agreement.

 

*Disability.*If the Optionee’s ContinuousStatus as an Employee, Director or Consultant terminates due to his or herdisability (as defined in Code Section 22(e)(3)), the Option may be exercisedby the Optionee within the 12 months immediately following such termination andto the extent that the Optionee was entitled to exercise the Option at the dateof his or her termination due to his or her disability; provided, however, thatthe Option may not be exercised after the Grant Expiration Date provided inSection 2(a) of this Agreement.

 

*Other Termination of Relationship.*If theOptionee’s Continuous Status as an Employee, Director or Consultant terminatesother than by death or due to disability and other than involuntarily for causeor voluntarily by the Optionee, the Optionee’s right to exercise the Option maybe exercised within the 30 days immediately following such termination and tothe extent that the Optionee was entitled to exercise the Option at the datehis or her termination; provided, however, that the Option may not be exercisedafter the Grant Expiration Date provided in Section 2(a) of this Agreement.

 

If the Optionee’sContinuous Status as an Employee, Director or Consultant is voluntarilyterminated by the Optionee or involuntarily terminated for cause, the Optionee’sright to exercise the Option shall immediately terminate and any thenunexercised portion of the Option shall be immediately canceled.

 

For purposes of thisAgreement, the term “cause” shall mean, with respect to any Optionee, (a) causeas defined in the employment agreement with the Company or any subsidiarythereof to which the Optionee is a party or, if none, (b) the occurrence of anyof the following events:

 

### (i)            the willful and continued failure by the Optioneeto substantially perform his or her duties with the Company or any subsidiarythereof on a full-time basis (other than any such failure resulting from totalor partial incapacity due to physical or mental illness) after a written 

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### demand for substantial performance isdelivered to the Optionee by the Board, which demand identifies the manner inwhich the Board believes that he or she has not substantially performed suchduties;

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### (ii)           the willful engaging by the Optionee in conductwhich is significantly injurious to the Company or to any subsidiary of theCompany, monetarily or otherwise, after a written demand for cessation of suchconduct is delivered to the Optionee by the Board, which demand specificallyidentifies the manner in which the Board believes that the Optionee has engagedin such conduct and the injury to the Company or to a subsidiary of the Companyresulting therefrom;

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### (iii)          the commission by the Optionee of an act or actsconstituting a crime involving moral turpitude;

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### (iv)          the breach by the Optionee of one or morecovenants, if any, in an agreement to which the Optionee and the Company areparties;

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### (v)           violation by the Optionee of Company policy; or

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### (vi)          the commission by the Optionee of a significantact of dishonesty, deceit or breach of fiduciary duty in the performance of theOptionee’s duties with the Company or with any subsidiary of the Company.

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For purposes of clauses(i) and (ii) of this definition, no act, or failure to act, on the part of anOptionee shall be deemed to be willful unless knowingly done, or omitted to bedone, by the Optionee notin good faith and without a reasonable belief that such action or omission wasin the best interests of the Company or of a subsidiary of the Company.

 

## **(d)****          ****Payment of Grant Price UponExercise.**At the time of anypurchase of Shares under the Option, the Grant Price for such Shares as setforth in the Certificate shall be paid by the Optionee in full to the Company.The Optionee may pay the Grant Price in whole or in part by any of thefollowing methods:

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### (i)            cash or by check made payable to the Company;

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### (ii)           by delivery to the Company of certificatesrepresenting the number of Shares then owned by the Optionee, the Fair MarketValue of which equals the purchase price of the Shares purchased pursuant tothe Option, properly endorsed for transfer to the Company; provided, however,that Shares used for this purpose must have been held by the Optionee for suchminimum period of time as may be established from time to time by theCommittee; and provided further that the Fair Market Value of any Sharesdelivered in payment of the purchase price upon exercise of the Options shallbe the Fair Market Value as of the exercise date, 

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### which shall be the date of delivery of thecertificates for the Shares used as payment of the Option Grant Price;

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### In lieu of actually surrendering to theCompany the stock certificates representing the number of Shares then owned bythe Optionee, the Optionee may submit to the Company a statement affirmingownership by the Optionee of such number of Shares (together with such evidenceof ownership as the Company may require) and request that such Shares, althoughnot actually surrendered, be deemed to have been surrendered by the Optionee aspayment of the exercise price;

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### (iii)          by authorizing a third party to sell a sufficientportion of the Shares acquired upon the exercise of the Option and remit to theCompany the portion of the sale proceeds sufficient to pay the Grant Price andany tax withholding resulting from such exercise that is not paid by theOptionee in cash or by check; or

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### (iv)          any combination of the consideration provided inthe foregoing subsections (i), (ii) and (iii).

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## **(e)****          ****Nontransferability.**The Option shall not be transferable other than bya will of the Optionee or by the laws of descent and distribution, and shall beexercisable during the lifetime of the Optionee only by the Optionee or hisattorney-in-fact or conservator, unless the Option is an Incentive Stock Optionand such exercise by the attorney-in-fact or the conservator of the Optioneewould disqualify the Option as such under Code Section 422.

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## **(f)****           ****Adjustments in Event of Change inCommon Stock.**If any change ismade in the Shares subject to the Option, without the receipt of considerationby the Company (through merger, consolidation, reorganization,recapitalization, reincorporation, stock dividend, dividend in property otherthan cash, stock split, liquidating dividend, combination of shares, exchangeof shares, change in corporate structure or other transaction not involving thereceipt of consideration by the Company), the Option will be appropriatelyadjusted in the class(es) and number of shares and price per share of stock ofthose subject Shares in such manner as the Board may deem equitable to preventsubstantial dilution or enlargement of the rights granted to the Optionee;provided, however, that no such adjustment shall cause the Company to issue afractional share under the Option. Such adjustments shall be final, binding andconclusive. (The conversion of any convertible securities of the Company shallnot be treated as a transaction not involving the receipt of consideration bythe Company.)

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## **(g)****          ****No Rights as a Shareholder.**The Optionee shall have no rights as a shareholderwith respect to any Shares subject to the Option prior to the date of issuanceto him or her of a certificate or certificates for such Shares.

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## **(h)****          ****No Rights to ContinuedRelationship.**The Option shallnot confer upon the Optionee any right with respect to continuance ofemployment by the Company or by an Affiliate, nor shall it interfere in any waywith the right of his or her employer to terminate his or her employment at anytime.

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The Option shall notconfer upon the Optionee any right with respect to continuance of adirectorship of the Company or of an Affiliate, nor shall it interfere in anyway with the right of the shareholders to remove him or her as a director atany time.

 

The Option shall notconfer upon the Optionee any right with respect to continuance of anyconsulting arrangement with the Company or any Affiliate, nor shall itinterfere in any way with the right of the Company or an Affiliate, as the casemay be, to terminate any such arrangement.

 

## **(i)****           ****Sale of the Company.**In the event of a dissolution, liquidation or saleof all or substantially all of the assets of the Company, or that the Companyis not the surviving corporation in any merger, consolidation, orreorganization, then the Option shall be canceled as of the effective date ofsuch transaction; provided, however, the Board shall give at least 30 days’written notice of the transaction to the Optionee and during the periodbeginning the Optionee receives the notice and ending on the date of thetransaction, the Optionee shall have the right to exercise all or any part ofthe unexercised portion of the Option (without regard to employmentrequirements or any installment exercise limitations) (the “Accelerated Amount”);provided further that no part of the Option may be exercised after the GrantExpiration Date provided in Section 2(a) of this Agreement. If the Option is anIncentive Stock Option, the Accelerated Amount under this Section shall remainexercisable as an Incentive Stock Option under Code Section 422 only to theextent that the $100,000 dollar limitation of Code Section 422(d) is notexceeded. To the extent that such dollar limitation is exceeded, theAccelerated Amount shall be exercisable as a Non-Qualified Stock Option.

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## **(j)****           ****Compliance with Other Laws andRegulations.**The Option and theobligation of the Company to sell and deliver Shares hereunder, shall besubject to all applicable federal and state laws, rules, and regulations, andto such approvals by any government or regulatory agency as may be required.The Company shall not be required to issue or deliver any certificates forShares prior to the completion of any registration or qualification of suchShares under any federal or state law, or any rule or regulation of anygovernmental body which the Company shall, in its sole discretion, determine tobe necessary or advisable.

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To the extent applicable,it is intended that this Agreement and the Plan comply with the provisions ofSection 409A of the Code. This Agreement and the Plan shall be administered ina manner consistent with this intent, and any provision that would cause thisAgreement or the Plan to fail to satisfy Section 409A of the Code shall have noforce or effect until amended to comply with Section 409A of the Code (whichamendment may be retroactive to the extent permitted by Section 409A of theCode and may be made by the Company without the consent of the Optionee).

 

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## **(k)****          ****Withholding Taxes.**The Optionee agrees to make appropriatearrangements with the Company or Affiliate, as the case may be, for thesatisfaction of all federal, state and local income and employment taxwithholding requirements applicable to the exercise of the Option. No Shareswill be delivered pursuant to the exercise of the Option until the Optionee, orany other person to whom the Option is transferred, has made acceptablearrangements for these withholding requirements. Unless denied by theCommittee, the Optionee may elect to pay all minimum required amounts of taxwithholding, or any part thereof, by electing to transfer to the Company, orhave withheld from any shares otherwise eligible to be delivered under thisAgreement, shares of Common Stock having a value equal to the minimum amountrequired to be withheld under federal, state or local law or such lesser amountas may be elected by the Optionee. The value of shares of Common Stock to betransferred to the Company shall be the fair market value of the shares on thedate that the amount of tax to be withheld is to be determined (the “Tax Date”),as determined by the Company. Any such elections by the Optionee to have sharesof Common Stock withheld for this purpose will be subject to the followingrestrictions:

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### (i)            All elections must be made prior to the Tax Date;

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### (ii)           All elections shall be irrevocable; and

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### (iii)          If the Optionee is an officer or director of theCompany within the meaning of Section 16 of the Securities Exchange Act of 1934(“Section 16”), the Optionee must satisfy the requirements of such Section 16and any applicable rules thereunder with respect to the use of Common Stock tosatisfy such tax withholding obligation.

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# **3.****            ****Investment Representation.**The Company may require that the Optionee furnishto the Company, as a condition of exercising or acquiring stock underlying theOption, (a) written assurances satisfactory to the Company, or counsel forthe Company, as to the Optionee’s knowledge and experience in financial andbusiness matters and/or to employ a purchaser representative reasonablysatisfactory to the Company, or counsel for the Company, who is knowledgeable andexperienced in financial and business matters, and that he or she is capable ofevaluating, alone or together with the purchaser representative, the merits andrisks of exercising the Option; and (b) written assurances satisfactory to theCompany, or counsel for the Company, stating that the Optionee is acquiring thestock subject to the Option for the Optionee’s own account and not with anypresent intention of selling or otherwise distributing the stock underlying theOption. The Company may (a) restrict the transferability of the stockunderlying the Option and require a legend to be endorsed on the certificatesrepresenting such stock, as appropriate to reflect resale restrictions, if any,imposed by the Board pursuant to the Option when granted, or as appropriate tocomply with any applicable state or federal securities laws, rules orregulations; and (b) condition the exercise of the Option or the issuanceand delivery of stock underlying the Option upon the listing, registration orqualification of such stock upon a securities exchange or quotation system orunder applicable securities laws. The foregoing requirements, and anyassurances given pursuant to such requirements, shall be inoperative if(a) the issuance of stock upon the exercise of the Option has beenregistered under a then currently effective registration statement under theSecurities Act, or (b) as to any 

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# particular requirement, a determination is made by counsel for theCompany that such requirement need not be met in the circumstances under thethen applicable securities laws. The Company may, upon advice of counsel to theCompany, place legends on stock certificates issued under the Option as suchcounsel deems necessary or appropriate in order to comply with applicablesecurities laws, including, but not limited to, legends restricting thetransfer of the stock.

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# **4.****            ****Optionee Bound by the Plan.**The Optionee agrees to be bound by all the termsand provisions of the Plan. To the extent that the terms of this Agreement areinconsistent with the terms of the Plan, the terms of the Plan shall govern.The captions used in the Certificate, this Agreement, and the Plan are insertedfor convenience and shall not be deemed a part of the Option for constructionor interpretation.

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This Agreement, theCertificate, and the Plan shall be construed in accordance with the laws of theState of Colorado, without regard to the conflict of laws principles.

 

# **5.****            ****Notices.**Any notice to the Company or the Board that isrequired to be made under the terms of the Agreement or under the terms of thePlan shall be addressed to the Company in care of its president at 12 CorporateWoods, 10975 Benson Street, Suite 390, Overland Park, Kansas 66210. Any noticethat is required to be made to the Optionee under the terms of the Agreement orunder the terms of the Plan shall be addressed to him or her at the addressindicated in the Certificate unless the Optionee notifies the Company of his orher address change in writing as provided in this Section 5 in which case thenotice shall be addressed to the Optionee at his or her new address. A noticeunder this Section 5 shall be deemed to have been given or delivered uponpersonal delivery or upon deposit in the United States mail, by registered orcertified mail, postage prepaid and properly addressed as provided in thisSection.

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