ex10-10.htm


    
      

    

    
      Exhibit
10.10

       

       

      INTERNAP
NETWORK SERVICES CORPORATION

      2002
STOCK COMPENSATION PLAN

       

      NONSTATUTORY

      STOCK
OPTION AGREEMENT

       

      1.                
Grant of
Option.    Internap Network Services Corporation, a
Delaware corporation (the “Company”), hereby grants to
Optionee (“Optionee”)
named in the Notice of Stock Option Grant (the “Notice”), an option (the
“Option”) to purchase a
total number of shares of Common Stock (the “Shares”) set forth in the
Notice, at the exercise price per share (the “Exercise Price”) set forth in
the Notice, subject to the terms, definitions and provisions of the Internap
Network Services Corporation 2002 Stock Compensation Plan (the “Plan”), which is incorporated
herein by reference, and the terms of this Stock Option Agreement (the “Agreement”). Unless otherwise
defined herein, the terms defined in the Plan shall have the same defined
meanings in this Agreement. In the event of a conflict between the terms and
conditions of the Plan and the terms and conditions of this Agreement, the terms
and conditions of the Plan shall prevail. This option is a Nonstatutory Stock
Option.

       

      2.                 Exercise of
Option.    This Option shall be exercisable during
its term in accordance with the Vesting Schedule set out in the Notice so long
as Optionee is an Employee, Director or Consultant, as the case may be, and with
the provisions of Section 8 and 9 of the Plan as set forth below. A change in
status of Optionee from his or her status at the time of grant (i.e., (i)
Optionee is a Consultant or non-Employee Director at the time of grant and
subsequently becomes an Employee or (ii) Optionee is an Employee at the time of
grant and subsequently becomes a Consultant or non-Employee Director) shall be
deemed a termination of employment or service with the Company at the time of
such change in status whereupon, unless otherwise provided by the Administrator
in its sole discretion, vesting of the Shares shall immediately cease in
full.

       

      (a)   Right to
Exercise.

       

      (i)    This Option
may not be exercised for a fraction of a Share.

       

      (ii)    In the event
of Optionee’s death, disability or other termination of employment or service
with the Company, the exercisability of the Option is governed by Sections 5, 6,
and 7 below, subject to the limitation contained in subsection
2(a)(i).

       

      (iii)          
In no event may this Option be exercised after the date of expiration of the
term of this Option as set forth in the Notice.

       

      (b)   Method of
Exercise.

       

      (i)    This Option
shall be exercisable by (i) delivery of a written notice (in the form attached
hereto as Exhibit A) which shall state the election to exercise the Option, the
number of Shares in respect of which the Option is being exercised (the “Exercised Shares”),
and such
other representations and agreements as may be required by the Company pursuant
to the provisions of the Plan or (ii) by executing a “cashless exercise” through
the Company’s designated broker. The written notice shall be signed by Optionee
and shall be delivered in person or by certified mail to the Stock Option
Administrator of the Company and shall be accompanied by payment of the
aggregate Exercise Price as to all Exercised Shares. This Option shall be deemed
to be exercised upon receipt by the Company of such written notice accompanied
by such aggregate Exercise Price or by Optionee’s execution of a “cashless”
exercise with the Company’s designated broker.

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      (ii)    As a
condition to the exercise of this Option, Optionee agrees to make adequate
provision for federal, state or other tax withholding obligations, if any, which
arise upon the exercise of the Option or disposition of Shares, whether by
withholding, direct payment to the Company, or otherwise.

       

      (iii)           No
Shares will be issued pursuant to the exercise of the Option unless such
issuance and such exercise shall comply with all relevant provisions of
Applicable Laws. Assuming such compliance, for income tax purposes the Exercised
Shares shall be considered transferred to Optionee on the date on which the
Option is exercised with respect to such Exercised Shares.

       

      3.        
Method of
Payment.    Payment of the Exercise Price shall be by
any of the following, or a combination thereof, at the election of
Optionee:

       

      (i)    
cash;

       

      (ii)    check;

       

      (iii)   surrender of other
Shares which (A) in the case of Shares acquired pursuant to the exercise of a
Company option, have been owned by Optionee for more than six (6) months on the
date of surrender or were not acquired, directly or indirectly, from the
Company, and (B) have a Fair Market Value on the date of surrender equal to the
aggregate Exercise Price of the Shares as to which the Option is being
exercised; or

       

      (iv)   delivery of a
properly executed exercise notice together with such other documentation as the
Administrator and the broker, if applicable, shall require to effect an exercise
of the Option and delivery to the Company of the sale or loan proceeds required
to pay the aggregate Exercise Price.

       

      4.        
Restrictions on
Exercise.    This Option may not be exercised if the
issuance of such Shares upon such exercise or the method of payment of
consideration for such Shares would constitute a violation of any Applicable
Laws.

       

      5.         
Termination of
Relationship.    In the event of termination of
Optionee’s employment or service with the Company, Optionee may, to the extent
otherwise so entitled at the date of such termination (the “Termination Date”),
exercise this Option during the Termination Period set out in the Notice. To the
extent that Optionee was not entitled to exercise this Option at the date of
such termination, or if Optionee does not exercise this Option within the time
specified herein, the Option shall terminate. A change in status of Optionee
from his or her
status at the time of grant (i.e., (i) Optionee is a Consultant or non-Employee
Director at the time of grant and subsequently becomes an Employee or (ii)
Optionee is an Employee at the time of grant and subsequently becomes a
Consultant or non-Employee Director) shall be deemed a termination of employment
or service with the Company at the time of such change in status whereupon,
unless otherwise provided by the Administrator in its sole discretion, the
provisions of this Section 5 shall apply.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      6.         
Disability of
Optionee.    Notwithstanding the provisions of
Section 5 above, in the event of termination of Optionee’s employment or service
with the Company as a result of Optionee’s Disability, Optionee may, but only
within twelve (12) months from the date of such termination (but in no event
later than the expiration date of the term of such Option as set forth in
Section 9 below), exercise the Option to the extent otherwise entitled to
exercise it at the date of such termination. To the extent that Optionee was not
entitled to exercise this Option at the date of such termination, or if Optionee
does not exercise this Option within the time specified herein, the Option shall
terminate.

       

      7.         
Death of
Optionee.    In the event of the death of Optionee,
the Option may be exercised at any time within twelve (12) months following the
date of Optionee’s death (but in no event later than the date of expiration of
the term of this Option as set forth in Section 9 below), by Optionee’s estate,
by a person who acquired the right to exercise the Option by bequest or
inheritance or by the laws of descent and distribution or by a beneficiary
designated to exercise the Option upon the Optionee’s death pursuant to Section
8, but only to the extent Optionee could exercise the Option at the date of
death. To the extent that Optionee was not entitled to exercise this Option at
the date of such termination, or if Optionee’s estate, the person who acquired
the right to exercise the Option by bequest or inheritance or by the laws of
descent and distribution or the beneficiary designated to exercise the Option
upon the Optionee’s death pursuant to Section 8 does not exercise this Option
within the time specified herein, the Option shall terminate.

       

      8.          Non-Transferability of
Option.    This Option may not be transferred in any
manner otherwise than by will or by the laws of descent or distribution and may
be exercised during the lifetime of Optionee only by Optionee. Notwithstanding
the foregoing, the Optionee may, by delivering written notice to the Company, in
a form satisfactory to the Company, designate a beneficiary who, in the event of
the death of the Optionee, shall thereafter be entitled to exercise the Option.
The terms of this Option shall be binding upon the executors, administrators,
heirs, successors and assigns of Optionee.

       

      9.         
Term of
Option.    This Option may be exercised only within
the term set out in the Notice, and may be exercised during such term only in
accordance with the Plan and the terms of this Agreement.

       

      10.       
Tax
Consequences.    Set forth below is a brief summary
as of the date of this Option of certain United States federal tax consequences
of exercise of this Option and disposition of the Shares under the laws in
effect as of the date of grant. THIS SUMMARY DOES NOT ADDRESS SPECIFIC STATE, LOCAL OR FOREIGN TAX CONSEQUENCES
THAT MAY BE APPLICABLE TO OPTIONEE. OPTIONEE IS RESPONSIBLE FOR CONSULTING A TAX
ADVISER AS TO THE APPLICABLE TAX
LAWS OF THE JURISDICTION(S) IN WHICH OPTIONEE RESIDES OR MAY BE SUBJECT TO TAX
BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES. OPTIONEE UNDERSTANDS
THAT THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS
ARE SUBJECT TO CHANGE.

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      (i)     Exercise of Nonstatutory Stock
Option.    There may be a regular federal income tax
liability upon the exercise of the Option. Optionee will be treated as having
received compensation income (taxable at ordinary income tax rates) equal to the
excess, if any, of the Fair Market Value of the Shares on the date of exercise
over the Exercise Price. If Optionee is an employee or former employee of the
Company, the Company will be required to withhold from Optionee’s compensation
or collect from Optionee and pay to the applicable taxing authorities an amount
equal to a percentage of this compensation income at the time of
exercise.

       

      (ii)    Disposition of
Shares.    In the case of a Nonstatutory Stock
Option, if Shares are held for more than one year after the date of exercise,
any gain realized on disposition of the Shares will be treated as long-term
capital gain for federal income tax purposes.

       

      11.      
Governing
Law.    This Agreement shall be governed by and
construed according to the laws of the State of Delaware without regard to its
principles of conflict of laws.

       

      12.       
Whole
Agreement.    The Plan and Notice are hereby
incorporated by reference and made a part hereof, and the Option and this
Agreement shall be subject to all terms and conditions of the Plan and the
Notice.

       

      13.       
Amendments.    This
Agreement may be amended or modified at any time only by an instrument in
writing signed by each of the parties hereto.

       

      14.       
Rights as a
Stockholder.    Neither Optionee nor any of
Optionee’s successors in interest shall have any rights as a stockholder of the
Company with respect to any Shares subject to the Option until the date of
issuance of a stock certificate for such Shares or the date the Shares are
electronically delivered to Optionee’s brokerage account.

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

       

      EXHIBIT
A

       

      INTERNAP
NETWORK SERVICES CORPORATION EXERCISE NOTICE

       

      
        	
                Optionee
      Name:

              	 
      	 
      	 
      	
                Social
      Security #:

              	 
      	 
      
	
                Home
      Address:

              	 
      	
                 

              	 
      	
                Daytime
      Phone Number:

              	 
      	
                 

              
	 
      	 
      	
                 

              	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      


      

       

      [Missing Graphic Reference]

      Option(s)
Exercised:

      
        	
                Plan

              	 	 	
                Grant
      Number

              	 	 	
                Grant
      Date

              	 	 	
                NQ**
      or ISO?

              	 	 	
                (1)
      x Grant Price

                Per
      Share

              	 	 	
                (2)
      = Number of

                Shares
      To be

                exercised

              	 	 	
                (3)
      Total Exercise Option Price

              	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
      	 	 	 
      	 	 	 
      	 	 	 
      	 	 	 	 	 	$	 	 	 	$	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
      	 	 	 
      	 	 	 
      	 	 	 
      	 	 	 	 	 	$	 	 	 	$	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
      	 	 	 
      	 	 	 
      	 	 	 
      	 	 	 	 	 	$	 	 	 	$	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
      	 	 	 
      	 	 	 
      	 	 	 
      	 	 	 	 	 	$	 	 	 	$	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 
      	 	 	 
      	 	 	 
      	 	 	 
      	 	 	 
      	 	 	
                Subtotal

              	 	 	$	 	 
	 
      	 	 	 
      	 	 	 
      	 	 	 
      	 	 	
                **Total
      NQ Taxes Dues:

              	 	 	$	 	 
	 
      	 	 	 
      	 	 	 
      	 	 	 
      	 	 	
                Totals

              	 	 	 	 	 	 	$	 	 


      

       

      
        
          

        

         

      

       

      Payment and Issuance
Instructions:

      
        	
                Attached
      is my check #                 
      in the amount of $                    
      to pay for the exercise of my stock option as listed
  above.

              


      

      
        	
                Issue
      the shares as designated below:

              


      

      
        	
                 ̈    My
      broker as designated below:
                              OR                
       ̈    Mail
      a certificate to the address listed
below:

              


      

       

      
        	
                Broker
      Name:        
                                              
                                          

              


      

       

      
        	
                Company
      Name:                                         
                                             
                                            
                                              
                             

              


      

       

      Street
Address

      
        	
                Address:                                    
                                              
                      

              


      

       

      
        	
                                                     
                                              
                                    

              


      

       

      
        	
                DTC#                                    
                                              
                                             
                                              
                                              
                   

              


      

       

                  City                        
State                        
Zip Code

      
        	
                Account
      #:        
                                              
                                              

              


      

       

      
        	
                Phone
      Number:                                             
                                           

              


      

       

      
        	
                Fax
      Number:     
                                              
                                              

              


      

       

      
        
          

        

      

       

      
        	
                Representations:

              


      

      
        	
                             I
      do NOT have access to, nor am I aware of, any inside information regarding
      Internap Network Services
Corporation

              


      

      Initial  which
could or has influenced my decision to purchase and/or sell this
stock.

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

       

                    I
hereby agree to notify Internap Network Services Corporation upon the
transfer/sale of my shares acquired under any ISO  

      Initial  exercise
and agree to hold harmless Internap Network Services Corporation regarding the
reporting of income subject to the

      transfer/sale
of these shares. I am not relying on Internap Network Services Corporation or
E*TRADE Business Solutions Group for any tax advice.

       

      OFFICERS
AND DIRECTORS ONLY

      
        	
                I
      AM an officer and/or director of Internap Network Services Corporation and
      I (initial for each response):

              


      

                          have
reviewed my transactions relative to Section 16.

                          have
held this option 6 months from date of grant.

                          wish/wish
not to file an 83(b) Election.

                          am
required to sell pursuant to Rule 144 & have filed the necessary
documentation.

                          understand
a Form 4 will be required because of this transaction.

       

      
        
          

        

      

      The
undersigned holder of the stock option(s) described above irrevocably exercises
such option(s) as set forth and herewith makes payment therefore, all at the
price and on the terms and conditions specified in the stock option agreement(s)
pertaining to the option(s) exercised.

      INSTRUCTIONS:            
Mail this completed exercise form and check, made payable to:

      Internap
Network Services Corporation, 250 Williams Street, Suite E100, Atlanta,
GA 30303, Attn: Stock Administration

       

      
        	
                 

              	 
      	 
	
                Optionee
      Signature

              	 
      	
                Date

              


      

      
         

        
          

        

      

       

       

      6