Document:

EXHIBIT 10.2

 

INDEMNIFICATION AGREEMENT

 

This INDEMNIFICATION AGREEMENT (the “Agreement”) is made and entered
into as of the ––– day of –––––––––––– ,  ––––, by and between
Trammell Crow Company, a Delaware corporation (the “Company”), and ––––––––––– (“Indemnitee”).

 

RECITALS:

 

A.                                   Competent
and experienced persons are reluctant to serve or to continue to serve
corporations as directors, officers, or in other capacities unless they are
provided with adequate protection through insurance or indemnification (or
both) against claims and actions against them arising out of their service to
and activities on behalf of those corporations.

 

B.                                     The
current uncertainties relating to the availability of adequate insurance for
directors and officers have increased the difficulty for corporations to
attract and retain competent and experienced persons.

 

C.                                     The
Board of Directors of the Company has determined that the continuation of
present trends in litigation will make it more difficult to attract and retain
competent and experienced persons, that this situation is detrimental to the
best interests of the Company’s stockholders, and that the Company should act
to assure its directors and officers that there will be increased certainty of
adequate protection in the future.

 

D.                                    It
is reasonable, prudent, and necessary for the Company to obligate itself
contractually to indemnify its directors and officers to the fullest extent
permitted by applicable law in order to induce them to serve or continue to
serve the Company.

 

E.                                      Indemnitee
is willing to serve and continue to serve the Company on the condition that he
be indemnified to the fullest extent permitted by law.

 

F.                                      Concurrently
with the execution of this Agreement, Indemnitee is agreeing to serve or to
continue to serve as a director or officer of the Company.

 

AGREEMENTS:

 

NOW, THEREFORE, in consideration of the foregoing premises, Indemnitee’s
agreement to serve or continue to serve as a director or officer of the
Company, and the covenants contained in this Agreement, the Company and
Indemnitee hereby covenant and agree as follows:

 

1.                                       Certain
Definitions:

 

For purposes of this Agreement:

 

(a)                                  Acquiring
Person:  shall mean any Person other
than (i) the Company, (ii) any of the Company’s Subsidiaries,
(iii) any employee benefit plan of the Company or of a Subsidiary of the
Company or of a corporation owned directly or indirectly by the stockholders of
the Company in substantially the same proportions as their ownership of stock
of the Company, or (iv) any trustee or other fiduciary holding securities
under an employee benefit plan of the Company or of a Subsidiary of the Company
or of a corporation owned directly or indirectly by the stockholders of the
Company in substantially the same proportions as their ownership of stock of
the Company.

 

(b)                                 Change
in Control:  shall be deemed to have
occurred if:

 

(i)                                     any
Acquiring Person is or becomes the “beneficial owner” (as defined in
Rule 13d-3 under the Securities Exchange Act of 1934 (the “Exchange Act”)),
directly or indirectly, of securities of the Company representing fifty percent
or more of the combined voting power of the then outstanding Voting Securities
of the Company; or

 

(ii)                                  members
of the Incumbent Board cease for any reason to constitute at least a majority
of the Board of Directors of the Company; or

 

 

(iii)                               the
Company merges or consolidates with any other corporation or entity, or the
Company or the stockholders of the Company and holders of voting securities in
such other corporation or entity participate in a securities exchange, other
than a merger or consolidation that would result in the Voting Securities of
the Company outstanding immediately before the completion thereof continuing to
represent a majority of the combined voting power of the Voting Securities of
the surviving entity (or its parent) outstanding immediately after that merger,
consolidation or securities exchange; or

 

(iv)                              the
Company liquidates, sells or disposes of all or substantially all the Company’s
assets in one transaction or series of transactions other than a liquidation,
sale or disposition of all or substantially all the Company’s assets in one
transaction or a series of related transactions to an entity owned directly or
indirectly by the stockholders of the Company in substantially the same
proportions as their ownership of stock of the Company.

 

(c)                                  Claim:  shall mean any threatened, pending or
completed action, suit or proceeding (including, without limitation, securities
laws actions, suits and proceedings and also any crossclaim or counterclaim in
any action, suit or proceeding), whether civil, criminal, arbitral,
administrative or investigative in nature, or any inquiry or investigation
(including discovery), whether conducted by the Company or any other Person,
that Indemnitee in good faith believes might lead to the institution of any
action, suit or proceeding.

 

(d)                                 Expenses:  shall mean all costs, expenses (including
attorneys’ and expert witnesses’ fees), and obligations paid or incurred in
connection with investigating, defending (including affirmative defenses and
counterclaims), being a witness in, or participating in (including on appeal),
or preparing to defend, be a witness in, or participate in, any Claim relating
to any Indemnifiable Event.

 

(e)                                  Incumbent
Board:  shall mean individuals who,
as of August 21, 1997, constitute the Board of Directors of the Company
and any other individual who becomes a director of the Company after that date
and whose election or appointment by the Board of Directors or nomination for
election by the Company’s stockholders was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board.

 

(f)                                    Indemnifiable
Event:  shall mean any actual or
alleged act, omission, statement, misstatement, event or occurrence related to
the fact that Indemnitee is or was a director, officer, agent or fiduciary of
the Company, or is or was serving at the request of the Company as a director,
officer, trustee, agent or fiduciary of another corporation, partnership, joint
venture, employee benefit plan, trust or other enterprise, or by reason of any
actual or alleged thing done or not done by Indemnitee in any such capacity.
For purposes of this Agreement, the Company agrees that Indemnitee’s service on
behalf of or with respect to any Subsidiary or employee benefits plan of the
Company or any Subsidiary of the Company shall be deemed to be at the request
of the Company.

 

(g)                                 Indemnifiable
Liabilities:  shall mean all Expenses
and all other liabilities, damages (including, without limitation, punitive,
exemplary, and the multiplied portion of any damages), judgments, payments,
fines, penalties, amounts paid in settlement and awards paid or incurred that
arise out of, or in any way relate to, any Indemnifiable Event.

 

(h)                                 Person: shall mean any person or entity of any
nature whatsoever, specifically including an individual, a firm, a company, a
corporation, a partnership, a trust or other entity. A Person, together with
that Person’s Affiliates and Associates (as those terms are defined in
Rule 12b-2 under the Exchange Act), and any Persons acting as a
partnership, limited partnership, joint venture, association, syndicate or
other group (whether or not formally organized), or otherwise acting jointly or
in concert or in a coordinated or consciously parallel manner (whether or not
pursuant to any express agreement), for the purpose of acquiring, holding,
voting or disposing of securities of the Company with such Person, shall be
deemed a single “Person.”

 

(i)                                     Potential
Change in Control:  shall be deemed
to have occurred if (i) the Company enters into an agreement, the
consummation of which would result in the occurrence of a Change in Control;
(ii) any Person (including the Company) publicly announces an intention to
take or to consider taking actions that, if consummated, would constitute a
Change in Control; or (iii) the Board of Directors of the Company adopts a
resolution to the effect that, for purposes of this Agreement, a Potential
Change in Control has occurred.

 

(j)                                     Reviewing
Party:  shall mean any appropriate
person or body consisting of a member or members of the Company’s Board of
Directors or any other person or body appointed by the Board (including Special
Counsel referred to in Section 3) who is not a party to the particular
Claim for which Indemnitee is seeking indemnification.

 

 

(k)                                  Special
Counsel:  shall mean special,
independent counsel selected by Indemnitee and approved by the Company (which
approval shall not be unreasonably withheld), and who has not otherwise
performed services for the Company or for Indemnitee within the last three
years (other than as Special Counsel under this Agreement or similar
agreements).

 

(l)                                     Subsidiary:  shall mean, with respect to any Person, any
corporation or other entity of which a majority of the voting power of the
voting equity securities or equity interest is owned, directly or indirectly,
by that Person.

 

(m)                               Voting
Securities:  shall mean any
securities that vote generally in the election of directors, in the admission
of general partners, or in the selection of any other similar governing body.

 

2.                                       Indemnification
and Expense Advancement.

 

(a)                                  The
Company shall indemnify Indemnitee and hold Indemnitee harmless to the fullest
extent permitted by law, as soon as practicable but in any event no later than
30 days after written demand is presented to the Company, from and against
any and all Indemnifiable Liabilities. Notwithstanding the foregoing, the
obligations of the Company under this Section 2(a) shall be subject to the
condition that the Reviewing Party shall not have determined (in a written
opinion, in any case in which Special Counsel is involved) that Indemnitee is
not permitted to be indemnified under applicable law. Nothing contained in this
Agreement shall require any determination under this Section 2(a) to be
made by the Reviewing Party prior to the disposition or conclusion of the Claim
against the Indemnitee.

 

(b)                                 If
so requested in writing by Indemnitee, the Company shall advance to Indemnitee
all Expenses incurred by Indemnitee (or, if applicable, reimburse Indemnitee
for any and all Expenses incurred by Indemnitee and previously paid by
Indemnitee) (an “Expense Advance”) within ten business days after such request
and delivery by Indemnitee of an undertaking to repay Expense Advances if and
to the extent such undertaking is required by applicable law prior to the
Company’s payment of Expense Advances. The Company shall be obligated from time
to time at the request of Indemnitee to make or pay an Expense Advance in
advance of the final disposition or conclusion of any Claim. In connection with
any request for an Expense Advance, if requested by the Company, Indemnitee or
Indemnitee’s counsel shall submit an affidavit stating that the Expenses to
which the Expense Advances relate are reasonable. Any dispute as to the
reasonableness of any Expense shall not delay an Expense Advance by the
Company. If, when, and to the extent that the Reviewing Party determines that
Indemnitee would not be permitted to be indemnified with respect to a Claim
under applicable law, the Company shall be entitled to be reimbursed by
Indemnitee and Indemnitee hereby agrees to reimburse the Company without
interest (which agreement shall be an unsecured obligation of Indemnitee) for
all related Expense Advances theretofore made or paid by the Company; provided,
however, that if Indemnitee has commenced legal proceedings in a court of
competent jurisdiction to secure a determination that Indemnitee could be
indemnified under applicable law, any determination made by the Reviewing Party
that Indemnitee would not be permitted to be indemnified under applicable law
shall not be binding, and Indemnitee shall not be required to reimburse the
Company for any Expense Advance, and the Company shall be obligated to continue
to make Expense Advances, until a final judicial determination is made with
respect thereto (as to which all rights of appeal therefrom have been exhausted
or lapsed). If there has not been a Potential Change in Control or a Change in Control,
the Reviewing Party shall be selected by the Board of Directors of the Company.
If there has been a Potential Change in Control or a Change in Control, the
Reviewing Party shall be advised by or shall be Special Counsel referred to in Section 3
hereof, if and as Indemnitee so requests. If there has been no determination by
the Reviewing Party or if the Reviewing Party determines that Indemnitee
substantively would not be permitted to be indemnified in whole or part under
applicable law, Indemnitee shall have the right to commence litigation in any
court in the states of Texas or Delaware having subject matter jurisdiction
thereof and in which venue is proper seeking an initial determination by the
court or challenging any such determination by the Reviewing Party or any
aspect thereof, and the Company hereby consents to service of process and to
appear in any such proceeding. Any determination by the Reviewing Party
otherwise shall be conclusive and binding on the Company and Indemnitee.

 

3.                                       Change
in Control.  The Company agrees that,
if there is a Potential Change in Control or a Change in Control and if
Indemnitee requests in writing that Special Counsel advise the Reviewing Party
or be the Reviewing Party, then the Company shall not (i) deny any indemnification
payments (and Expense Advances shall continue to be paid by the Company
pursuant to Section 2(b)) that Indemnitee requests or demands under this
Agreement or any other agreement or law now or hereafter in effect relating to
Claims for Indemnifiable Events, or (ii) request or seek reimbursement
from Indemnitee of any indemnification payment or Expense Advances unless, in
either case, Special Counsel has rendered its written opinion to the Company
and Indemnitee that the Company was not or is not permitted under applicable
law to pay Indemnitee and to allow Indemnitee to retain such indemnification
payment or Expense Advances. However, if Indemnitee has commenced legal
proceedings in a court of competent jurisdiction to secure a determination that
Indemnitee could be indemnified under applicable law, any determination made by
Special Counsel that Indemnitee would not be permitted to be indemnified under
applicable law

 

 

shall not be binding, and Indemnitee shall not be required to reimburse
the Company for any Expense Advance, and the Company shall be obligated to
continue to make Expense Advances, until a final judicial determination is made
with respect thereto (as to which all rights of appeal therefore have been
exhausted or lapsed). The Company agrees to pay the reasonable fees of Special
Counsel and to indemnify Special Counsel against any and all expenses
(including attorneys’ fees), claims, liabilities and damages arising out of or
relating to this Agreement or Special Counsel’s engagement pursuant hereto.

 

4.                                       Establishment
of Trust.  In the event of a
Potential Change in Control or a Change in Control, the Company shall, upon
written request by Indemnitee, create a trust for the benefit of Indemnitee
(the “Trust”) and from time to time upon written request of Indemnitee shall
fund the Trust in an amount equal to all Indemnifiable Liabilities reasonably
anticipated at the time to be incurred in connection with any Claim. The amount
to be deposited in the Trust pursuant to the foregoing funding obligation shall
be determined by the Reviewing Party. The terms of the Trust shall provide
that, upon a Change in Control, (i) the Trust shall not be revoked or the
principal thereof invaded, without the written consent of Indemnitee; (ii) the
trustee of the Trust shall advance, within ten business days of a request by
Indemnitee, any and all Expenses to Indemnitee (and Indemnitee hereby agrees to
reimburse the Trust under the circumstances in which Indemnitee would be
required to reimburse the Company for Expense Advances under this Agreement);
(iii) the Trust shall continue to be funded by the Company in accordance
with the funding obligation set forth above; (iv) the trustee of the Trust
shall promptly pay to Indemnitee all amounts for which Indemnitee shall be
entitled to indemnification pursuant to this Agreement or otherwise; and
(v) all unexpended funds in that Trust shall revert to the Company upon a
final determination by the Reviewing Party or a court of competent
jurisdiction, as the case may be, that Indemnitee has received amounts, if any,
which fully satisfy the Company’s obligation to indemnify Indemnitee under the
terms of this Agreement. The trustee of the Trust shall be chosen by
Indemnitee. Nothing in this Section 4 shall relieve the Company of any of
its obligations under this Agreement.

 

5.                                       Indemnification
for Additional Expenses.  The Company
shall indemnify Indemnitee against any and all costs and expenses (including
attorneys’ and expert witnesses’ fees) and, if requested by Indemnitee, shall
(within two business days of that request) advance those costs and expenses to
Indemnitee, that are incurred by Indemnitee if Indemnitee, whether by formal
proceedings or through demand and negotiation without formal proceedings:
(a) seeks to enforce Indemnitee’s rights under this Agreement,
(b) seeks to enforce Indemnitee’s rights to expense advancement or
indemnification under any other agreement or provision of the Company’s
Certificate of Incorporation (the “Certificate of Incorporation”), or Bylaws
(the “Bylaws”), now or hereafter in effect relating to Claims for Indemnifiable
Events, or (c) seeks recovery under any directors’ and officers’ liability
insurance policies maintained by the Company, in each case regardless of
whether Indemnitee ultimately prevails. To the fullest extent permitted by law,
the Company waives any and all rights that it may have to recover its costs and
expenses from Indemnitee.

 

6.                                       Partial
Indemnity.  If Indemnitee is entitled
under any provision of this Agreement to indemnification by the Company for
some, but not all, of Indemnitee’s Indemnifiable Liabilities, the Company shall
indemnify Indemnitee for the portion thereof to which Indemnitee is entitled.

 

7.                                       Contribution.

 

(a)                                  Contribution
Payment.  To the extent the
indemnification provided for under any provision of this Agreement is
determined (in the manner hereinabove provided) not to be permitted under
applicable law, the Company, in lieu of indemnifying Indemnitee, shall, to the
extent permitted by law, contribute to the amount of any and all Indemnifiable
Liabilities incurred or paid by Indemnitee for which such indemnification is
not permitted. The amount the Company contributes shall be in such proportion
as is appropriate to reflect the relative fault of Indemnitee, on the one hand,
and of the Company and any and all other parties (including officers and
directors of the Company other than Indemnitee) who may be at fault
(collectively, including the Company, the “Third Parties”), on the other hand.

 

(b)                                 Relative
Fault.  The relative fault of the
Third Parties and the Indemnitee shall be determined (i) by reference to
the relative fault of Indemnitee as determined by the court or other
governmental agency or (ii) to the extent such court or other governmental
agency does not apportion relative fault, by the Reviewing Party (which shall
include Special Counsel) after giving effect to, among other things, the
relative intent, knowledge, access to information and opportunity to prevent or
correct the relevant events, of each party, and other relevant equitable
considerations. The Company and Indemnitee agree that it would not be just and
equitable if contribution were determined by pro rata allocation or by any
other method of allocation which does take account of the equitable
considerations referred to in this Section 7(b).

 

8.                                       Burden
of Proof.  In connection with any
determination by the Reviewing Party or otherwise as to whether Indemnitee is
entitled to be indemnified under any provision of this Agreement or to receive
contribution pursuant to Section 7 of

 

 

this Agreement, to the extent permitted by law the burden of proof
shall be on the Company to establish that Indemnitee is not so entitled.

 

9.                                       No
Presumption.  For purposes of this
Agreement, the termination of any Claim by judgment, order, settlement (whether
with or without court approval), or conviction, or upon a plea of nolo
contendere, or its equivalent, or an entry of an order of probation prior to
judgment shall not create a presumption (other than any presumption arising as
a matter of law that the parties may not contractually agree to disregard) that
Indemnitee did not meet any particular standard of conduct or have any
particular belief or that a court has determined that indemnification is not permitted
by applicable law.

 

10.                                 Non-Exclusivity.  The rights of Indemnitee hereunder shall be
in addition to any other rights Indemnitee may have under the Bylaws or
Certificate of Incorporation or the Delaware General Corporation Law or
otherwise. To the extent that a change in the Delaware General Corporation Law
(whether by statute or judicial decision) permits greater indemnification by
agreement than would be afforded currently under the Bylaws or Certificate of
Incorporation and this Agreement, it is the intent of the parties hereto that
Indemnitee shall enjoy by this Agreement the greater benefits so afforded by
that change. Indemnitee’s rights under this Agreement shall not be diminished
by any amendment to the Certificate of Incorporation or Bylaws, or of any other
agreement or instrument to which Indemnitee is not a party, and shall not
diminish any other rights which Indemnitee now or in the future has against the
Company.

 

11.                                 Liability
Insurance.  Except as otherwise
agreed to by the Company and Indemnitee in a written agreement, to the extent
the Company maintains an insurance policy or policies providing directors’ and
officers’ liability insurance, Indemnitee shall be covered by that policy or
those policies, in accordance with its or their terms, to the maximum extent of
the coverage available for any Company director or officer.

 

12.                                 Period
of Limitations.  No action, lawsuit
or proceeding may be brought against Indemnitee or Indemnitee’s spouse, heirs,
executors or personal or legal representatives, nor may any cause of action be
asserted in any such action, lawsuit or proceeding, by or on behalf of the
Company, after the expiration of two years after the statute of limitations
commences with respect to Indemnitee’s act or omission which gave rise to the
action, lawsuit, proceeding or cause of action; provided, however, that, if any
shorter period of limitations is otherwise applicable to any such action,
lawsuit, proceeding or cause of action, the shorter period shall govern.

 

13.                                 Amendments.  No supplement, modification, or amendment of
this Agreement shall be binding unless executed in writing by both of the
parties hereto. No waiver of any provision of this Agreement shall be effective
unless in a writing signed by the party granting the waiver. No waiver of any
of the provisions of this Agreement shall be deemed or shall constitute a
waiver of any other provisions hereof (whether or not similar) nor shall that
waiver constitute a continuing waiver.

 

14.                                 Other
Sources.  Indemnitee shall not be
required to exercise any rights that Indemnitee may have against any other
Person (for example, under an insurance policy) or before Indemnitee enforces
his rights under this Agreement. However, to the extent the Company actually
indemnifies Indemnitee or advances him Expenses, the Company shall be
subrogated to the rights of Indemnitee and shall be entitled to enforce any
such rights which Indemnitee may have against third parties. Indemnitee shall
assist the Company in enforcing those rights if it pays his costs and expenses
of doing so. If Indemnitee is actually indemnified or advanced Expenses by any
third party, then, for so long as Indemnitee is not required to disgorge the
amounts so received, to that extent the Company shall be relieved of it obligation
to indemnify Indemnitee or advance Indemnitee Expenses.

 

15.                                 Binding
Effect.  This Agreement shall be
binding upon and inure to the benefit of and be enforceable by the parties
hereto and their respective successors, assigns (including any direct or
indirect successor by purchase, merger, consolidation or otherwise to all or
substantially all of the business or assets of the Company), spouses, heirs and
personal and legal representatives. This Agreement shall continue in effect
regardless of whether Indemnitee continues to serve as an officer or director
of the Company or another enterprise at the Company’s request.

 

16.                                 Severability.  If any provision of this Agreement is held to
be illegal, invalid or unenforceable under present or future laws effective
during the term hereof, that provision shall be fully severable; this Agreement
shall be construed and enforced as if that illegal, invalid or unenforceable
provision had never comprised a part hereof; and the remaining provisions shall
remain in full force and effect and shall not be affected by the illegal,
invalid or unenforceable provision or by its severance from this Agreement.
Furthermore, in lieu of that illegal, invalid or unenforceable provision, there
shall be added automatically as a part of this Agreement a provision as similar
in terms to the illegal, invalid or unenforceable provision as may be possible
and be legal, valid and enforceable.

 

 

17.                                 Governing
Law.  This Agreement shall be
governed by and construed and enforced in accordance with the laws of the State
of Delaware applicable to contracts made and to be performed in that state
without giving effect to the principles of conflicts of laws.

 

18.                                 Headings.  The headings contained in this Agreement are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

 

19.                                 Notices.  Whenever this Agreement requires or permits
notice to be given by one party to the other, such notice must be in writing to
be effective and shall be deemed delivered and received by the party to whom it
is sent upon actual receipt (by any means) of such notice. Receipt of a notice
by the Secretary of the Company shall be deemed receipt of such notice by the
Company.

 

20.                                 Complete
Agreement.  This Agreement constitutes
the complete understanding and agreement among the parties with respect to the
subject matter hereof and supersedes all prior agreements and understandings
between the parties with respect to the subject matter hereof.

 

21.                                 Counterparts.  This Agreement may be executed in any number
of counterparts, each of which shall be deemed an original, but in making proof
hereof it shall not be necessary to produce or account for more than one such
counterpart.

 

[THE REMAINDER OF PAGE IS INTENTIONALLY
BLANK]

 

 

EXECUTED as of the date first written above.

 

	
   

  	
  TRAMMELL CROW COMPANY,

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  INDEMNITEE

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

 

SCHEDULE

INDEMNIFICATION AGREEMENTS

 

Following is a list of the officers and directors of the Company who
have entered into agreements substantially identical to the Indemnification Agreement
filed herewith.

 

	
  Individual
  Indemnitee

  	
   

  	
  Date of Agreement

  
	
  Robert
  E. Sulentie

  	
   

  	
  September 21, 1997

  
	
  William F. Concannon

  	
   

  	
  September 21, 1997

  
	
  J. McDonald Williams

  	
   

  	
  September 21, 1997

  
	
  James R. Erwin

  	
   

  	
  November 24, 1997

  
	
  Jeffrey M. Heller

  	
   

  	
  November 24, 1997

  
	
  Rowland T. Moriarty

  	
   

  	
  December 16, 1997

  
	
  Curtis Feeny

  	
   

  	
  May 25, 2001

  
	
  James R. Groch

  	
   

  	
  May 25, 2001

  
	
  Derek R. McClain

  	
   

  	
  May 25, 2001

  
	
  T. Christopher Roth

  	
   

  	
  May 25, 2001

  
	
  John A. Stirek

  	
   

  	
  May 25, 2001

  
	
  E.S. Belcher

  	
   

  	
  May 25, 2001

  
	
  Michael J. Lafitte

  	
   

  	
  August 27, 2002

  
	
  Diane S. Detering-Paddison

  	
   

  	
  January 6, 2004

  
	
  Matthew S. Khourie

  	
   

  	
  July 28, 2004

  
	
  J. Christopher Kirk

  	
   

  	
  August 18, 2004

  
	
  Michael A. Moses

  	
   

  	
  September 28, 2004

  
	
  Arlin E. Gaffner

  	
   

  	
  November 5, 2004Exhibit 10.1

 

BROOKTROUT TECHNOLOGY,
INC.

1992 STOCK INCENTIVE PLAN

 

NON-QUALIFIED STOCK
OPTION AGREEMENT

 

 

	
   

  	
   

  	
  September 24, 2004

  
	
  No. of Shares

  	
   

  	
  Date

  

 

 

Pursuant to its 1992 Stock Incentive Plan(the “Plan),
Brooktrout Technology, Inc.(the “Company”) hereby grants to _________ (the
“Optionee”) an Option to purchase on or prior to September 24, 2014(the
“Expiration Date”) all or any part of _______ shares of Common Stock of the
Company, par value $0.01 per share(the “Common Stock”) at a price of $9.30 per
share in accordance with the schedule set forth in Section 1 hereof and subject
to the terms and conditions set forth hereinafter and in the Plan.

 

1.  Vesting Schedule

 

(a)  Subject to the provisions of Section 5
and 6 hereof and the discretion of the Committee (as defined in the Plan, and
hereinafter referred to as the “Committee”) to accelerate the vesting schedule
hereunder, and subject to possible acceleration under Section 1(b), this Option
shall become vested and exercisable with respect to the following number of
Option Shares according to the timetable set forth below:

 

	
  Number of Years

  After Date of Grant

  	
   

  	
  Percentage of Option

  Becoming Available

  for Exercise

  	
   

  	
  Cumulative

  Percentage

  Available

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Immediately

  	
   

  	
  25

  	
  %

  	
  25

  	
  %

  
	
  At least 1 years

  	
   

  	
  25

  	
  %

  	
  50

  	
  %

  
	
  At least 2 years

  	
   

  	
  25

  	
  %

  	
  75

  	
  %

  
	
  At least 3 years

  	
   

  	
  25

  	
  %

  	
  100

  	
  %

  

 

2.  Manner of Exercise  The Optionee may exercise this Option only in
the following manner: from time to time on or prior to the Expiration Date of
this Option, the Optionee may give written notice to the Stock Option Committee
of the Board of Directors of the Company (the “Committee”) of his or her
election to purchase some or all of the vested Option Shares purchasable at the
time of such notice.  Said notice shall
specify the number of shares to be purchased.

 

Payment of the purchase price for the Option Shares
may be made by one or more of the following methods: (a) in cash, by certified
or bank check or other instrument acceptable by the Committee; or (b) in the
form of shares of Common Stock that are not then subject to restrictions under
any Company plan (subject to the Committee’s discretion); or (c) 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 option purchase price;
provided that in the event the Optionee chooses to pay the option 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 Committee shall prescribe as a condition of such payment procedure.  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 therefor, as set forth above, and any agreement, statement or other
evidence as the Company may require to satisfy itself that the issuance of
Option Shares to be purchased pursuant to the exercise of Option rights under
this Plan and any subsequent resale of the shares will be in compliance with
applicable laws and regulations.

 

If requested upon the exercise of this Option,
certificates for shares may be issued in the name of the Optionee jointly with
another person or in the name of the executor or administrator of the
Optionee’s estate.

 

Nothwithstanding any other provision hereof or of the
Plan, no portion of this Stock Option shall be exercisable after the Expiration
Date hereof.

 

3.  Non-transferability of Option  This Option shall not be transferable by the
Optionee otherwise than by will or by the laws of descent and distribution and
this Option shall be exercisable, during the Optionee’s lifetime, only by the
Optionee.

 

4.  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 Option may be
subject to earlier termination as set forth below.

 

(a)  Termination by Death  If
the Optionee’s employment terminates by reason of death, any Option held by the
Optionee may be exercised, to the extent exercisable at the date of death, by
the Optionee’s legal representative or legatee for a period of one hundred
eighty (180) days from the date of death or until the Expiration Date, if
earlier.

 

(b)  Termination by Reason of Disability  If
the Optionee’s employment terminates by reason of Disability (as defined in the
Plan), any Option held by the Optionee may be exercised, to the extent
exercisable on the date of termination, for a period

 

2

 

of twelve months (12) from the date of
termination or until the Expiration Date, if earlier.

 

(c)  Termination for Cause  If
the Optionee’s employment terminates for Cause (as defined in the Plan), any
Option held by the Optionee shall immediately terminate and be of no further
force and effect.

 

(d)  Other Termination  If
the Optionee’s employment terminates for any reason other than death,
Disability or Cause, 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 3 months from the date of termination or until
the Expiration Date, if earlier.

 

For this purpose, neither a transfer of employment from the Company to
a Subsidiary (or from a Subsidiary to the Company) nor an approved leave of
absence shall be deemed a “termination of employment.”

 

5.  Sale of the Company  Upon
any (a) sale or other transfer of all or substantially all the assets of the
Company; (b) merger or consolidation of the Company with another corporation
(except any such transaction in which the stockholders of the Company receive a
controlling interest on the surviving or resulting corporation); or (c) sale by
one or more stockholders of a controlling interest on the Company, this Option
shall fully vest and shall be exercisable as to all Option Shares covered
hereby, effective immediately prior to the consummation of the transaction
referred to in clause (a), (b) or (c) hereof. 
For purposes of the foregoing, a “controlling interest” means stock of
any class or classes carrying a majority of the votes of all outstanding stock.

 

6.  Option Shares  The
Option Shares are shares of the Common Stock of the Company as constituted on
the date of this Option, subject to adjustment as provided in Section 3(b) of
the Plan.

 

7.  No Special Employment Rights  This Option will not confer upon the Optionee
any right with respect to continuance of employment by the Company or a
Subsidiary, nor will it interfere in any way with the right of the Optionee’s
employer to terminate the Optionee’s employment at any time.

 

8.  Rights as a Stockholder  The Optionee shall have no rights as a
stockholder with respect to any shares of Common Stock which may be purchased
by exercise of this Option unless and until a certificate or certificates
representing such shares are duly issued and delivered to the Optionee.  Except as otherwise expressly provided in the
Plan, no adjustment shall be

 

3

 

made for dividends or other rights for which the record
date is prior to the date such stock certificate is issued.

 

9.  Tax Withholding   No
later than the date as of which part or all of the value of any Common Stock
received under the Plan first becomes includable in the Optionee’s gross income
for federal tax purposes, the Optionee shall make arrangements with the Company
in accordance with Section 9 of the Plan regarding the payment of any federal,
state, or local taxes required to be withheld with respect to such income.

 

10.  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.

 

11.  Miscellaneous  Notices
hereunder shall be mailed or delivered to the Company at its principal place of
business and shall be mailed or delivered to 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.

 

 

	
   

  	
  BROOKTROUT TECHNOLOGY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
				

 

 

 

 

 

Receipt of the foregoing Option is acknowledged and
its terms and conditions are hereby agreed to:

 

 

	
   

  	
   

  
	
   

  	
  , Optionee

  
	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  
					

 

4

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