Document:

Exhibit 10.5

 

Date:

 

Nonqualified Stock Option Granted

 

 

by

 

 

CHARLES RIVER ASSOCIATES INCORPORATED

 

(hereinafter called the “Company”)

 

 

to

 

 

 

 

(hereinafter called the “Holder”)

 

 

under the

 

 

1998 INCENTIVE AND NONQUALIFIED STOCK OPTION PLAN

 

 

WITNESSETH:

 

For
valuable consideration, the receipt of which is hereby acknowledged, the
Company hereby grants to the Holder the following option:

 

 FIRST: 
Subject to the terms and conditions hereinafter set forth, the Holder is
hereby given the right and option to purchase from the Company an aggregate of                 
shares of Common Stock of the Company, without par value, at the time and in
the manner hereinafter stated.  Schedule A
attached hereto and hereby incorporated herein sets forth with respect to this
option (i) its expiration date, (ii) its exercise price per share, (iii) its
vesting rate, and (iv) certain other terms and conditions applicable to this
option and incorporated herein.

 

This
option is and shall be subject in every respect to the provisions of the
Company’s 1998 Incentive and Nonqualified Stock Option Plan (the “Plan”), as
amended 

 

 

from time to time, which
is incorporated herein by reference and made a part hereof.  In the event of any conflict or inconsistency
between the terms hereof and those of the Plan, the latter shall prevail.  References herein to the Plan Administrator
shall mean the Plan Administrator as defined in the Plan.

 

This
option shall be exercised by the delivery of written notice to the Company (the
“Notice”) setting forth the number of shares with respect to which the option
is to be exercised and the address to which the certificates for such shares
are to be mailed, together with (i) cash or check payable to the order of the
Company for an amount equal to the option price for the number of shares
specified in the Notice, or (ii) with the consent of the Plan Administrator,
shares of Common Stock of the Company which (a) either have been owned by the
Holder 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 not greater than the option price for the shares
as to which such option is being exercised, (iii) with the consent of the Plan
Administrator, delivery of such documentation as the Plan Administrator and a
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 option
price of the shares for which the option is being exercised, (iv) with the
consent of the Plan Administrator, such other consideration which is acceptable
to the Plan Administrator and which has a fair market value equal to the option
price for the shares as to which the option is being exercised, or (v) with the
consent of the Plan Administrator, a combination of (i), (ii), (iii), (iv)
and/or (v).  For the purpose of the
preceding sentence, the fair market value per share of the Common Stock so delivered
to the Company shall be the closing price per share on the date of delivery as
reported by a nationally recognized stock exchange, or, if the Common Stock is
not listed on such an exchange, as reported by the National Association of
Securities Dealers Automated Quotation System (“Nasdaq”) National Market System
or, if the Common Stock is not listed on the Nasdaq National Market System, the
mean of the bid and asked prices per share on the date of delivery or, if the
Common Stock is not traded over-the-counter, the fair market value per share as
determined by the Plan Administrator.

 

Pursuant
to applicable Federal, state or local laws, the Company may be required to
withhold income or other taxes upon the exercise of this option.  The Company may require, as an additional
condition to the exercise of this option, that the Holder pay the Company at
the time of exercise an amount which the Company determines is sufficient to
satisfy all federal, state and other governmental withholding tax requirements
relating to such exercise.

 

SECOND:  The Company, in its discretion, may file a
registration statement on Form S-8 under the Securities Act of 1933 to register
shares of Common Stock reserved for issuance under the Plan.  At any time at which such a registration
statement is not in effect, it shall be an additional condition precedent to
any exercise of this option that the Holder shall deliver to the Company a
customary “investment letter” satisfactory to the Company and its counsel in
which, among other things, the Holder shall state that the Holder is purchasing
the shares for investment and acknowledges that they are not freely
transferable except in compliance with state and federal securities laws.

 

2

 

THIRD:  Within a reasonable time after receipt by the
Company of the Notice and payment for any shares to be purchased hereunder and,
if required as a condition to exercise, the investment letter described in
paragraph SECOND, the Company will deliver or cause to be delivered to the
Holder (or if any other individual or individuals are exercising this option,
to such individual or individuals) at the address specified in the Notice a
certificate or certificates for the number of shares with respect to which the
option is then being exercised, registered in the name or names of the
individual or individuals exercising the option, either alone or jointly with
another person or persons with rights of survivorship, as the individual or
individuals exercising the option shall prescribe in writing to the Company at
or prior to such purchase; provided, however, that if any law or regulation or
order of the Securities and Exchange Commission or other body having
jurisdiction in the premises shall require the Company or the Holder (or the
individual or individuals exercising this option) to take any action in
connection with the shares then being purchased, the date for the delivery of
the certificates for such shares shall be extended for the period necessary to
take and complete such action, it being understood that the Company shall have
no obligation to take and complete any such action.  The Company may imprint upon such certificate
the legend set forth in the Plan or such other legends referencing stock
transfer restrictions which counsel for the Company considers appropriate.  Delivery by the Company of the certificates
for such shares shall be deemed effected for all purposes when the Company or a
stock transfer agent of the Company shall have deposited such certificates in
the United States mail, addressed to the Holder, at the address specified in
the Notice.

 

FOURTH:  The existence of this option shall not affect
in any way the right or power of the Company or its stockholders to make or
authorize any or all adjustments, recapitalizations, reorganizations or other
changes in the Company’s capital structure or its business, or any merger or
consolidation of the Company, or any issue of Common Stock, or any issue of
bonds, debentures, preferred or prior preference stock or other capital stock
ahead of or affecting the Common Stock or the rights thereof, or the
dissolution or liquidation of the Company, or any sale or transfer of all or
any part of its assets or business, or any other corporate act or proceeding,
whether of a similar character or otherwise.

 

If the
Company shall effect a subdivision or consolidation of shares or other capital
readjustment, the payment of a stock dividend, or other increase or reduction
of the number of shares of the Common Stock outstanding, in any such case
without receiving compensation therefor in money, services or property, then
the number, class, and price per share of shares of stock subject to this
option shall be appropriately adjusted in such a manner as to entitle the
Holder to receive upon exercise of this option, for the same aggregate cash
consideration, the same total number and class of shares as the Holder would
have received as a result of the event requiring the adjustment had the Holder
exercised this option in full immediately prior to such event.

 

After a
merger of one or more corporations with or into the Company or after a
consolidation of the Company and one or more corporations in which the
stockholders of the Company immediately prior to such merger or consolidation
own after such merger 

 

3

 

or consolidation shares
representing at least fifty percent (50%) of the voting power of the Company or
the surviving or resulting corporation, as the case may be, the Holder shall,
at no additional cost, be entitled upon exercise of this option to receive in
lieu of the shares of Common Stock as to which this option was exercisable
immediately prior to such event, the number and class of shares of stock or
other securities, cash or property (including, without limitation, shares of
stock or other securities of another corporation or Common Stock) to which the
Holder would have been entitled pursuant to the terms of the agreement of
merger or consolidation if, immediately prior to such merger or consolidation,
the Holder had been the holder of record of a number of shares of Common Stock
equal to the number of shares for which this option shall be so exercised.

 

If the
Company is merged with or into or consolidated with another corporation, other
than a merger or consolidation in which the stockholders of the Company
immediately prior to such merger or consolidation continue to own after such
merger or consolidation shares representing at least fifty percent (50%) of the
voting power of the Company or the surviving or resulting corporation, as the
case may be, or if the Company is liquidated, or sells or otherwise disposes of
substantially all its assets to another corporation while this option remains
outstanding, then (i) subject to the provisions of clause (iii) below, after
the effective date of such merger, consolidation, liquidation, sale or
disposition, as the case may be, the Holder of this option shall be entitled,
upon exercise of this option, to receive, in lieu of the shares of Common Stock
as to which this option was exercisable immediately prior to such event, the
number and class of shares of stock or other securities, cash or property
(including, without limitation, shares of stock or other securities of another
corporation or Common Stock) to which the Holder would have been entitled
pursuant to the terms of the merger, consolidation, liquidation, sale or
disposition if, immediately prior to such event, the Holder had been the holder
of a number of shares of Common Stock equal to the number of shares as to which
such option shall be so exercised; (ii) the Plan Administrator may accelerate
the time for exercise of this option, so that from and after a date prior to
the effective date of such merger, consolidation, liquidation, sale or
disposition, as the case may be, specified by the Plan Administrator, such
accelerated options shall be exercisable in full; or (iii) this option may be
canceled by the Plan Administrator as of the effective date of any such merger,
consolidation, liquidation, sale or disposition provided that (x) notice of
such cancellation shall be given to the Holder and (y) the Holder shall have
the right to exercise this option to the extent that the same is then
exercisable or, if the Plan Administrator shall have accelerated the time for exercise
of this option pursuant to clause (ii) above, in full during the 10-day period
preceding the effective date of such merger, consolidation, liquidation, sale
or disposition.

 

Except
as hereinbefore expressly provided, the issue by the Company of shares of stock
of any class, or securities convertible into shares of stock of any class, for
cash or property, or for labor or services, either upon direct sale or upon the
exercise of rights or warrants to subscribe therefor, or upon conversion of
shares or obligations of the Company convertible into such shares or other
securities, shall not affect, and no adjustment by reason thereof shall be made
with respect to, the number or price of shares of Common Stock then subject to
outstanding options.

 

4

 

FIFTH:  No person shall, by virtue of the granting of
this option to the Holder, be deemed to be a holder of any shares purchasable
under this option or to be entitled to the rights or privileges of a holder of
such shares unless and until this option has been exercised with respect to
such shares and they have been issued pursuant to that exercise of this option.

 

The
Company shall, at all times while any portion of this option is outstanding,
reserve and keep available, out of shares of its authorized and unissued stock
or reacquired shares, a sufficient number of shares of its Common Stock to
satisfy the requirements of this option; shall comply with the terms of this
option promptly upon exercise of the option rights; and shall pay all fees or
expenses necessarily incurred by the Company in connection with the issuance
and delivery of shares pursuant to the exercise of this option.

 

SIXTH:  This option is not transferable by the Holder
otherwise than by will or under the laws of descent and distribution.  The granting of this option shall not impose
upon the Company any obligation to employ or to continue to employ the
Holder.  The right of the Company to
terminate the employment of the Holder shall not be diminished or affected by
reason of the fact that this option has been granted to such Holder.

 

This
option is exercisable, subject to the vesting rate and certain other terms and
conditions contained in Schedule A attached hereto and incorporated
herein, at any time prior to the date of expiration of this option and during
the Holder’s lifetime, only by the Holder, and by the Holder only while the
Holder is an employee of the Company, except that in the event the employment
of the Holder terminates for cause (as determined by the Company), without
cause or voluntarily by the Holder and other than in the event of death or
retirement in good standing from the Company for reasons of age or disability
under the then established rules of the Company, this option shall terminate
immediately.

 

As
used herein, “cause” shall mean (x) any material breach by the Holder of any
agreement to which the Holder and the Company (or any parent or subsidiary) are
both parties, (y) any act or omission to act by the Holder which may have a
material and adverse effect on the business of the Company (or any parent or
subsidiary) or on the Holder’s ability to perform services for the Company (or
any parent or subsidiary), including, without limitation, the commission of any
crime (other than ordinary traffic violations), or (z) any material misconduct
or material neglect of duties by the Holder in connection with the business or
affairs of the Company (or any parent or subsidiary) or any affiliate of the
Company (or any such parent or subsidiary).

 

In the
event of the retirement of the Holder in good standing from the employ of the
Company for reasons of age or disability under the then established rules of
the Company, this option shall terminate on the earlier of its expiration date
and a date ninety (90) days after the Holder’s retirement.  After such retirement the Holder shall have
the right, at any time prior to such termination, to exercise this option to
the extent the Holder was entitled to exercise such option immediately prior to
such retirement.

 

5

 

In the
event of the death of the Holder while the Holder is in the employ of the
Company (or any parent or subsidiary of the Company) and before the expiration
date of this option, this option shall terminate on the earlier of its
expiration date and a date one (1) year after his/her death.  After the death of the Holder, the Holder’s
executors, administrators or any person or persons to whom the Holder’s option
has been transferred by will or by the laws of descent and distribution shall
have the right to exercise this option at any time prior to the earlier of the
date of expiration of this option or one (1) year after the date of the death
of the original Holder.

 

SEVENTH:  Any notice to be given to the Company
hereunder shall be deemed sufficient if addressed to the Company and delivered
by hand or by mail to the Treasurer of the Company, 200 Clarendon Street,
Boston, Massachusetts 02116 or such other address as the Company may hereafter designate.

 

Any
notice to be given to the Holder hereunder shall be deemed sufficient if
addressed to and delivered in person to the Holder or when deposited in the
mail, postage prepaid, addressed to the Holder at the Holder’s address
furnished to the Company.

 

EIGHTH:
This option is subject to all laws, regulations and orders of any governmental
authority which may be applicable thereto and, notwithstanding any of the
provisions hereof, the Holder agrees that the Holder will not exercise the
option granted hereby nor will the Company be obligated to issue or sell any
shares of stock hereunder if the exercise thereof or the issuance or sale of
such shares, as the case may be, would constitute a violation by the Holder or
the Company of any such law, regulation or order or any provision thereof.  The Company shall not be obligated to take
any affirmative action in order to cause the exercise of this option or the
issuance or sale of shares pursuant hereto to comply with any such law,
regulation, order or provision.

 

NINTH:  This option shall be governed by, and
construed and enforced in accordance with, the substantive laws of The
Commonwealth of Massachusetts.

 

6

 

IN
WITNESS WHEREOF, the Company has caused this instrument to be executed in its
name and on its behalf as of the date first written above.

 

	
   

  	
  CHARLES RIVER
  ASSOCIATES INCORPORATED

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  	
   

  

 

ATTEST: (Seal)

 

 

	
   

  	
   

  
	
  Clerk or
  Assistant Clerk

  

 

7

 

SCHEDULE A

CHARLES RIVER ASSOCIATES INCORPORATED

 

Nonqualified Stock
Option

 

Date of Grant:

 

Name of Holder:

 

Address:

 

City, State, Zip:

 

Social Security
Number:

 

Maximum number of
shares for

which this option
is exercisable:

 

Exercise
(purchase) price per share:

 

Expiration date of
option:

 

Vesting Rate:  

 

Position in, or relationship to, the Company:

 

Other terms and conditions: The
Holder agrees that upon request of the Company or the underwriters managing any
underwritten offering of the Company’s securities, the Holder shall agree in
writing that for a period of time not to exceed one hundred eighty (180) days
from the effective date of any registration of securities of the Company the
Holder will not sell, make any short sale of, loan, grant any option for the
purchase of, or otherwise dispose of any shares of Common Stock issued pursuant
to the exercise of this option without the prior written consent of the Company
or such underwriters, as the case may be.

 

*     *     *

 

The undersigned Holder acknowledges
receipt of the stock option of which this Schedule A is a part and agrees
to its terms; and further acknowledges receipt of the Plan, as amended, the
prospectus describing the Plan (documents incorporated by reference in the
prospectus are available upon request), and the annual report for the most
recent fiscal year.

 

	
   

  	
   

  	
   

  
	
   

  	
  Holder’s
  Signature

  
	
   

  	
  Print Name:

  

 

8Exhibit 10.6

 

Date:

 

Nonqualified Stock Option Grant

 

 

by

 

 

CHARLES RIVER ASSOCIATES INCORPORATED

 

(hereinafter called the “Company”)

 

 

to

 

 

 

 

(hereinafter called the “Holder”)

 

 

under the

 

 

2004 NONQUALIFIED INDUCEMENT STOCK OPTION PLAN

 

 

WITNESSETH:

 

For
valuable consideration, the receipt of which is hereby acknowledged, the
Company hereby grants to the Holder the following option, subject to the terms
and conditions set forth below and as set forth in Schedule A
attached hereto (the “Grant”):

 

 FIRST:  Subject
to the terms and conditions hereinafter set forth, the Holder is hereby given
the right and option to purchase from the Company an aggregate of                
shares of Common Stock of the Company, without par value, at the time and in
the manner hereinafter stated.  Schedule A attached hereto and hereby incorporated herein sets
forth with respect to this option (i) its expiration
date, (ii) its exercise price per share, (iii) its vesting rate, and (iv)
certain other terms and conditions applicable to this option and incorporated
herein.

 

This
option is and shall be subject in every respect to the provisions of the
Company’s 2004 Nonqualified Inducement Stock Option Plan (the “Plan”), as may
be 

 

 

amended
from time to time, which is incorporated herein by reference and made a part
hereof.  In the event of any conflict or
inconsistency between the terms hereof and those of the Plan, the latter shall
prevail.  References herein to the Plan
Administrator shall mean the Plan Administrator as defined in the Plan.

 

Subject
to the provisions of this Grant, this option shall be exercised by the delivery
of written notice to the Company (the “Notice”) setting forth the number of
shares with respect to which the option is to be exercised and the address to
which the certificates for such shares are to be mailed, together with (i) cash or check payable to the order of the Company for an
amount equal to the option price for the number of shares specified in the
Notice; or (ii) with the consent of the Plan Administrator, by delivery to the
Company of shares of Common Stock that either have been purchased by the Holder
on the open market, or have been beneficially owned by the Holder for a period
of at least six months and are not then subject to restriction under any
Company plan (“mature shares”); such surrendered shares shall have a fair
market value equal in amount to the exercise price of the Inducement Options
being exercised; (iii) with the consent of the Plan Administrator, by delivery
of a personal recourse note issued by the Holder to the Company in a principal
amount equal to such aggregate exercise price and with such other terms,
including interest rate and maturity, as the Plan Administrator may determine
in its discretion; provided, however, that the interest rate borne by such note
shall not be less than the lowest applicable federal rate, as defined in Section 1274(d)
of the Internal Revenue Code of 1986, as amended; (iv) with the consent of the
Plan Administrator, by delivery of such documentation as the Plan Administrator
and a 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
option price of the shares for which the option is being exercised; (v) with
the consent of the Plan Administrator, such other consideration which is
acceptable to the Plan Administrator and which has a fair market value equal to
the option price for the shares as to which the option is being exercised; or
(vi) with the consent of the Plan Administrator, a combination of (i), (ii), (iii), (iv), (v) and/or (vi).  For the purpose of the preceding sentence,
the fair market value per share of the Common Stock so delivered to the Company
shall be the closing price per share on the date of delivery as reported by a
nationally recognized stock exchange, or, if the Common Stock is not listed on
such an exchange, as reported by the Nasdaq Stock
Market, Inc. or, if the Common Stock is not reported by the Nasdaq
Stock Market, Inc., the mean of the bid and asked prices per share on the date
of delivery or, if the Common Stock is not traded over-the-counter, the fair
market value per share as determined by the Plan Administrator.

 

SECOND:  The Company, in its discretion, may file a
registration statement on Form S-8 under the Securities Act of 1933 to register
shares of Common Stock reserved for issuance under the Plan.  At any time at which such a registration
statement is not in effect, it shall be an additional condition precedent to
any exercise of this option that the Holder shall deliver to the Company a
customary “investment letter” satisfactory to the Company and its counsel in
which, among other things, the Holder shall state that the Holder is purchasing
the shares for investment and acknowledges that they are not freely
transferable except in compliance with state and federal securities laws.

 

2

 

THIRD:  Within a reasonable time after receipt by the
Company of the Notice and payment for any shares to be purchased hereunder and,
if required as a condition to exercise, the investment letter described in
paragraph SECOND, the Company will deliver or cause to be delivered to the
Holder (or if any other individual or individuals are exercising this option,
to such individual or individuals) at the address specified in the Notice a
certificate or certificates for the number of shares with respect to which the
option is then being exercised, registered in the name or names of the
individual or individuals exercising the option, either alone or jointly with
another person or persons with rights of survivorship, as the individual or
individuals exercising the option shall prescribe in writing to the Company at
or prior to such purchase; provided, however, that if any law or regulation or
order of the Securities and Exchange Commission or other body having
jurisdiction in the premises shall require the Company or the Holder (or the
individual or individuals exercising this option) to take any action in
connection with the shares then being purchased, the date for the delivery of
the certificates for such shares shall be extended for the period necessary to
take and complete such action, it being understood that the Company shall have
no obligation to take and complete any such action.  The Company may imprint upon such certificate
the legend set forth in the Plan or such other legends referencing stock
transfer restrictions which counsel for the Company considers appropriate.  Delivery by the Company of the certificates
for such shares shall be deemed effected for all purposes when the Company or a
stock transfer agent of the Company shall have deposited such certificates in
the United States mail, addressed to the Holder, at the address specified in the
Notice.

 

FOURTH:  The existence of this option shall not affect
in any way the right or power of the Company or its stockholders to make or
authorize any or all adjustments, recapitalizations, reorganizations or other
changes in the Company’s capital structure or its business, or any merger or
consolidation of the Company, or any issue of Common Stock, or any issue of
bonds, debentures, preferred or prior preference stock or other capital stock
ahead of or affecting the Common Stock or the rights thereof, or the
dissolution or liquidation of the Company, or any sale or transfer of all or
any part of its assets or business, or any other corporate act or proceeding,
whether of a similar character or otherwise.

 

If the
Company shall effect a subdivision or consolidation of shares or other capital
readjustment, the payment of a stock dividend, or other increase or reduction
of the number of shares of the Common Stock outstanding, in any such case
without receiving compensation therefor in money,
services or property, then the number, class, and price per share of shares of
stock subject to this option shall be appropriately adjusted in such a manner
as to entitle the Holder to receive upon exercise of this option, for the same
aggregate cash consideration, the same total number and class of shares as the
Holder would have received as a result of the event requiring the adjustment
had the Holder exercised this option in full immediately prior to such event.

 

After
a merger of one or more corporations or other entities with or into the Company
or after a consolidation of the Company and one or more corporations or other
entities in which the stockholders of the Company immediately prior to such
merger or consolidation own after such merger or consolidation securities representing
at least fifty 

 

3

 

percent (50%) of the
voting power of the Company or the surviving or resulting corporation or
entity, as the case may be, the Holder shall, at no additional cost, be
entitled upon exercise of this option to receive in lieu of the shares of
Common Stock as to which this option was exercisable immediately prior to such
event, the number and class of shares of stock or other securities, cash or
property (including, without limitation, shares of stock or other securities of
another corporation or entity or Common Stock) to which the Holder would have
been entitled pursuant to the terms of the agreement of merger or consolidation
if, immediately prior to such merger or consolidation, the Holder had been the
holder of record of a number of shares of Common Stock equal to the number of
shares for which this option shall be so exercised.

 

If the
Company is merged with or into or consolidated with another corporation or
other entity, other than a merger or consolidation in which the stockholders of
the Company immediately prior to such merger or consolidation continue to own
after such merger or consolidation securities representing at least fifty
percent (50%) of the voting power of the Company or the surviving or resulting
entity, as the case may be, or if the Company is liquidated, or sells or
otherwise disposes of substantially all its assets to another entity while this
option remains outstanding, then (i) subject to the
provisions of clause (iii) below, after the effective date of such merger,
consolidation, liquidation, sale or disposition, as the case may be, the Holder
of this option shall be entitled, upon exercise of this option, to receive, in
lieu of the shares of Common Stock as to which this option was exercisable
immediately prior to such event, the number and class of shares of stock or
other securities, cash or property (including, without limitation, shares of
stock or other securities of another corporation or entity or Common Stock) to
which the Holder would have been entitled pursuant to the terms of the merger,
consolidation, liquidation, sale or disposition if, immediately prior to such
event, the Holder had been the holder of a number of shares of Common Stock
equal to the number of shares as to which such option shall be so exercised;
(ii) the Plan Administrator may accelerate the time for exercise of this
option, so that from and after a date prior to the effective date of such
merger, consolidation, liquidation, sale or disposition, as the case may be,
specified by the Plan Administrator, such accelerated options shall be
exercisable in full; or (iii) this option may be canceled by the Plan
Administrator as of the effective date of any such merger, consolidation, liquidation,
sale or disposition provided that (x) notice of such cancellation shall be
given to the Holder and (y) the Holder shall have the right to exercise this
option to the extent that the same is then exercisable or, if the Plan
Administrator shall have accelerated the time for exercise of this option
pursuant to clause (ii) above, in full during the 10-day period preceding the
effective date of such merger, consolidation, liquidation, sale or disposition.

 

Except
as hereinbefore expressly provided, the issue by the Company of shares of stock
of any class, or securities convertible into shares of stock of any class, for
cash or property, or for labor or services, either upon direct sale or upon the
exercise of rights or warrants to subscribe therefor,
or upon conversion of shares or obligations of the Company convertible into
such shares or other securities, shall not affect, and no adjustment by reason
thereof shall be made with respect to, the number or price of shares of Common
Stock then subject to outstanding options.

 

4

 

FIFTH:  No person shall, by virtue of the granting of
this option to the Holder, be deemed to be a holder of any shares purchasable
under this option or to be entitled to the rights or privileges of a holder of
such shares unless and until this option has been exercised with respect to
such shares and they have been issued pursuant to that exercise of this option.

 

The
Company shall, at all times while any portion of this option is outstanding,
reserve and keep available, out of shares of its authorized and unissued stock or reacquired shares, a sufficient number of
shares of its Common Stock to satisfy the requirements of this option; shall
comply with the terms of this option promptly upon exercise of the option
rights; and shall pay all fees or expenses necessarily incurred by the Company
in connection with the issuance and delivery of shares pursuant to the exercise
of this option.

 

SIXTH:  This option is not transferable by the Holder
otherwise than by will or under the laws of descent and distribution.  The granting of this option shall not impose
upon the Company any obligation to employ or to continue to employ the Holder.  The right of the Company to terminate the
employment of the Holder shall not be diminished or affected by reason of the
fact that this option has been granted to such Holder.

 

This
option is exercisable, subject to the vesting rate and certain other terms and
conditions contained herein and in Schedule A
attached hereto and incorporated herein, at any time prior to the termination
of this option and during the Holder’s lifetime, only by the Holder. Except as
may be otherwise expressly provided herein, this option shall terminate on the
earliest of:

 

(a)                                  the date of expiration thereof;

 

(b)                                 immediately upon the termination of the Holder’s
employment with or performance of services for the Company (or any parent or
subsidiary of the Company) by the Company (or any such parent or subsidiary)
for cause (as determined by the Company or such parent or subsidiary); or

 

(c)                                  in
the case of termination without cause or voluntary termination by the Holder,
thirty (30) days after the termination of the Holder’s employment with or
performance of services for the Company (or any parent or subsidiary of the
Company) for any reason other than death or retirement.

 

An employment
relationship between the Company (or any parent or subsidiary of the Company)
and the Holder shall be deemed to exist during any period in which the Holder
is employed by the Company (or any such parent or subsidiary).  Whether authorized leave of absence, or
absence on military or government service, shall constitute termination of the
employment relationship between the Company (or any parent or subsidiary of the
Company) and the Holder shall be determined by the Plan Administrator at the
time thereof.

 

5

 

As
used herein, “cause” shall mean (w) any material breach by the Holder of any
agreement to which the Holder and the Company (or any parent or subsidiary) are
both parties, (x) any act or omission to act by the Holder which may have a
material and adverse effect on the business of the Company (or any parent or
subsidiary) or on the Holder’s ability to perform services for the Company (or
any parent or subsidiary), including, without limitation, the commission of any
crime (other than ordinary traffic violations), (y) any material misconduct or
material neglect of duties by the Holder in connection with the business or
affairs of the Company (or any parent or subsidiary) or any affiliate of the
Company (or any such parent or subsidiary) or (z) “cause” as may otherwise be
defined in any other agreements between the Holder and the Company (or any such
parent or subsidiary).

 

In the
event of the retirement of the Holder in good standing from the employ of the
Company for reasons of age or disability under the then established rules of
the Company, this option shall terminate on the earlier of its expiration date
and a date ninety (90) days after the Holder’s retirement.  After such retirement the Holder shall have
the right, at any time prior to such termination, to exercise this option to
the extent the Holder was entitled to exercise such option immediately prior to
such retirement.

 

In the
event of the death of the Holder while the Holder is in the employ of the
Company (or any parent or subsidiary of the Company) and before the expiration
date of this option, this option shall terminate on the earlier of its expiration
date and a date one (1) year after the death of the Holder.  After the death of the Holder, the Holder’s
executors, administrators or any person or persons to whom the Holder’s option
has been transferred by will or by the laws of descent and distribution shall
have the right to exercise this option at any time prior to the earlier of the
date of expiration of this option or one (1) year after the date of the death
of the original Holder.

 

SEVENTH:  The Holder hereby agrees that the Company (or
any parent or subsidiary of the Company) may withhold from amounts due to the
Holder from the Company (or any such parent or subsidiary), the appropriate
amount of federal, state and local withholding taxes attributable to the Holder’s
exercise of this option.

 

At the
Holder’s election, with the consent of the Plan Administrator, the amount
required to be withheld may be satisfied, in whole or in part, by (i) authorizing the Company to withhold from shares of
Common Stock to be issued pursuant to the exercise of this option a number of
shares with an aggregate fair market value that would satisfy the minimum
withholding amount due with respect to such exercise, or (ii) transferring to
the Company a sufficient number of mature shares of Common Stock with an
aggregate fair market value that would satisfy the minimum withholding amount
due.

 

The
Holder further agrees that, if the Company does not withhold an amount due to
the Holder from the Company sufficient to satisfy the Company’s withholding
obligation, the Holder will reimburse the Company on demand, in cash, for the
amount underwithheld.

 

6

 

EIGHTH:  Any notice to be given to the Company
hereunder shall be deemed sufficient if addressed to the Company and delivered
by hand or by mail to the Treasurer of the Company, 200 Clarendon Street,
Boston, Massachusetts 02116 or such other address as the Company may hereafter
designate.

 

Any
notice to be given to the Holder hereunder shall be deemed sufficient if
addressed to and delivered in person to the Holder or when deposited in the
mail, postage prepaid, addressed to the Holder at the Holder’s address
furnished to the Company.

 

NINTH:
This option is subject to all laws, regulations and orders of any governmental
authority which may be applicable thereto and, notwithstanding any of the
provisions hereof, the Holder agrees that the Holder will not exercise the
option granted hereby nor will the Company be obligated to issue or sell any
shares of stock hereunder if the exercise thereof or the issuance or sale of
such shares, as the case may be, would constitute a violation by the Holder or
the Company of any such law, regulation or order or any provision thereof.  The Company shall not be obligated to take
any affirmative action in order to cause the exercise of this option or the
issuance or sale of shares pursuant hereto to comply with any such law,
regulation, order or provision.

 

TENTH:  This option shall be governed by, and
construed and enforced in accordance with, the substantive laws of The
Commonwealth of Massachusetts.

 

IN
WITNESS WHEREOF, the Company has caused this instrument to be executed in its
name and on its behalf as of the date first written above.

 

	
   

  	
  CHARLES RIVER
  ASSOCIATES INCORPORATED

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Its:

  	
   

  	
   

  

 

ATTEST: (Seal)

 

 

	
   

  	
   

  
	
  Secretary or

  
	
  Assistant
  Secretary

  

 

7

 

SCHEDULE A

CHARLES RIVER ASSOCIATES INCORPORATED

 

Nonqualified Stock
Option

 

Date of Grant:

 

Name of Holder:

 

Address:

 

City, State, Zip:

 

Social Security
Number:

 

Maximum number of
shares for

which
this option is exercisable:

 

Exercise (purchase) price
per share:

 

Expiration date of
option:

 

Vesting Rate:

 

 

 

 

 

Position in, or
relationship to, the Company:

 

Other terms and
conditions:

 

1.                                       The Holder agrees that upon request of
the Company or the underwriters managing any underwritten offering of the
Company’s securities, the Holder shall agree in writing that for a period of
time not to exceed one hundred eighty (180) days from the effective date of any
registration of securities of the Company the Holder will not sell, make any
short sale of, loan, grant any option for the purchase of, or otherwise dispose
of any shares of Common Stock issued pursuant to the exercise of this option
without the prior written consent of the Company or such underwriters, as the
case may be.

 

2.                                       The undersigned Holder acknowledges
receipt of the stock option of which this Schedule A is a part and agrees
to its terms.

 

*     *     *

 

 

	
   

  	
   

  	
   

  
	
   

  	
   Holder’s
  Signature

  
	
   

  	
   Print Name:

  

 

8

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