Document:

EX-10.22 Modification and Settlement Agreement

 

EXHIBIT 10.22

MODIFICATION AND SETTLEMENT AGREEMENT

     THE MODIFICATION AND SETTLEMENT AGREEMENT (hereinafter referred to as the
“Agreement”) is made and entered into by and between IBB REALTY, LLC, a Florida
Limited Liability Company, (hereinafter referred to as
“IBB”) and ODIMO
INCORPORATED (hereinafter referred to as AOdimo@) and IBB and Odimo will be
referred to collectively as the “Parties.”

WITNESSETH: 

     WHEREAS, IBB and Odimo desire to avoid litigation, and seek to resolve all matters in
controversy, disputes, and causes of action between the Parties in dealing with the original
Commercial Lease Agreement (hereinafter referred to as the “Lease”) dated and effective as of
January 1, 2006.

     WHEREAS, the Parties acknowledge that Odimo desires to terminate its lease obligation with IBB
dated January 1, 2006, for a payment of consideration of $500,000.00 along with an agreement to
surrender the security deposit of $79,327.33, Odimo shall be released from any liabilities on the
lease subject to the following provisions;

     FIRST: The payment of the $500,000.00 and the payment of $79,327.33 of the security
deposit shall not be considered rent monies owed by Odimo to IBB. The aggregate amount of
$579,327.33 is the fair estimate of damages that IBB will suffer due to Odimo’s termination of the
original lease. Upon payment of the $579,327.33 by Odimo to IBB, the Lease shall be terminated and
IBB shall release Odimo of and from any liability under the Lease. $30,204.54 of the $579,327.33
shall be held in escrow by IBB’s counsel Hoffman, Larin and Agnetti, P.A., (the “Escrow Agent”) and
shall be disbursed to Odimo upon Odimo vacating the premises.

     SECOND: In the event the $500,000.00 is not paid to IBB by January 1, 2007, then this
Agreement is hereby determined null and void and the original lease dated January 1, 2006 shall
remain in full force and effect.

     THIRD: The payment of the $500,000.00 and the release of the security deposit shall be paid
by Odimo to IBB on the day of the closing of sale, if any, by Odimo of any of Odimo’s assets (other
than inventory) outside the ordinary course of business. Said closing of the transaction must be
conducted prior to January 1, 2007 with payment being in the form of either a wire transfer or by
certified check.

     FOURTH: November and December 2006 rental monies shall be paid on the first calendar

 

 

day of each month, respectively. Odimo will pay the full amount of monthly rent for the months
of November 2006 and December 2006. Any amounts paid in excess of the $26,500.00 per month amount
(the aggregate being “rent” of $25,000.00 plus applicable sales tax of $1,500.00 totaling
$26,500.00 per month) shall be credited to Odimo, as long as the provisions contained in paragraph
one (1) above are complied with.

     FIFTH: In addition to rental monies for the months of November and December 2006, individually
and respectively, Odimo will continue to pay for the months of November and December, individually
and respectively for; (1) a forklift at $300.00 per month, (2) an alarm system service at $294.61
per month, and (3) a concession of $833.33 per month, pursuant to the original lease of January 1,
2006, which is applicable to sales tax and should be added. The total amount of the aforementioned
“other costs,” including $85.68 of sales tax is $1,513.62 per month. Odimo shall cover the costs of
security personnel in the event Odimo operates past the normal business hours of 6:30 p.m. Monday
through Friday.

     SIXTH: Pursuant to this agreement, Odimo will ensure that all permits shall be closed by the
end of this lease and all contractors must be paid in full. IBB and Odimo have knowledge that Ed
Helms Inc. installed the air conditioning unit in the computer room and that he still has an open
permit that has not been paid in full by Odimo. All permits must be closed and delivered to the
landlord’s representative Jeffery H. Weiss on or before December 15, 2006. In the event Odimo does
not provide to IBB a full and accurate release of all liens incurred to the property by December
15, 2006, then Odimo must place $10,000.00 into an escrow account, with Hoffman, Larin and Agnetti,
P.A., (the “Escrow Agent”) to ensure full payment of those debts and liens. Odimo represents that
there is no more than $10,000.00 owed as outstanding debt for any and all debts owed to
contractors, including but not limited to Ed Helms Inc.

     SEVENTH: Odimo will continue to keep appropriate and adequate insurance until the original
lease dated January 1, 2006 has officially been terminated, and provide proof thereof upon the
execution of this agreement.

     EIGHTH: If Odimo is completely vacated from the building and after IBB’s walk-through results
in approval by November 30, 2006, then Odimo will not be responsible for December 2006 rent. IBB
shall pay Odimo an amount equal to $854.84 for each day that Odimo has completely vacated the
building prior to December 31, 2006, for the month of December only.

     NINTH: Odimo will leave two air conditioning units installed in the computer room, one ceiling
fan installed, and two liebert units, one in the computer room and one in the telecom room. All

2

 

aforementioned units will become part of the property and hence the property of IBB. Odimo has
already provided a letter stating that upon Odimo vacating the premises the two air conditioning
units that were installed previously in the computer room are now the property of IBB.

     TENTH: Odimo must leave cubicles that are owned by IBB in place and cubicles that were set up
by Odimo may be removed, but must be replaced with original cubicles that were in respective areas
prior to when Odimo moved in. IBB agrees that the issue can be satisfied if Odimo wishes to leave
their cubicles in place.

     ELEVENTH: At the end of the original lease dated January 1, 2006, Odimo will return the
forklift which it is currently renting. The forklift must be returned in good working condition.

     TWELFTH: All garbage must be removed, the compactor must be emptied and the furniture that
belongs to Odimo must also be removed unless approved by IBB in advance, and if approved, said
property will immediately become the property of IBB.

     THIRTEENTH: Pursuant to page 17, paragraph 31, sections A, B, and C of the original lease
dated January 1, 2006, titled “Surrender or Premises: Holding Over” provides for IBB to conduct a
walk-through of the property to determine at IBB’s discretion that the property is free from
damages.

     FOURTEENTH: Odimo must remove all containers in the warehouse in which inventory was stored.
The racking system (mezzanine) that is used for storage of merchandise may be removed, and if not
removed, shall become part of the property of IBB. To the extent Odimo removes the mezzanine ,
Odimo must pull all permits, including demolition permits if necessary, that are required by the
City of Sunrise, use licensed and insured (including workers compensation insurance) contractors
to remove the mezzanine and sprinkler heads, including electrical and anything else that is
involved in this matter.

     FIFTEENTH: This is to be the entire Agreement between the parties. Any modifications pursuant
to this Agreement must be in writing and dated and signed by both parties as is stated in paragraph
thirty-five (35) of the original lease signed and dated January 1, 2006.

     SIXTEENTH: All other provisions of the lease dated January 1, 2006 to the extent that they do
not conflict with this Agreement, shall remain in full force and effect until terminated upon the
payment of the $579,327.33.

     SEVENTEENTH: The Parties represent and agree that they have thoroughly discussed all aspects
of this Agreement with their attorneys and have carefully read and fully understand all of the
provisions of this Agreement, and that they are voluntarily entering into this Agreement.

3

 

     EIGHTEENTH: The Parties hereto represent and acknowledge that in executing this Agreement they
do not rely and have not relied on any representation or statement made by and of the Parties or by
any of the Parties’ agents, representatives, or attorneys with regard to the subject matter,
basis, or effect of this Agreement or otherwise, other than those specifically stated in this
written Agreement.

     NINETEENTH: Should any provision of this Agreement be declared or be determined by any court
of competent jurisdiction to be illegal, invalid, unethical, or unenforceable, the legality,
validity and enforceability of the remaining parts, terms or provisions shall not be affected
thereby, and the illegal, unenforceable, unethical or invalid part, term, or provision shall be
deemed not to be part of this Agreement.

     TWENTIETH: Any disputes that arise under this Agreement and any issues that arise
regarding the entering into, the validity, and/or execution of this Agreement, will be settled in
accordance with Florida law. If any part of this Agreement violates a provision of applicable
Florida law, the applicable Florida law will control. In such a case, however, the remainder of
this Agreement shall remain in force and effect.

     TWENTY-FIRST: Any claim or controversy arising out of, or relating to, this Modification and
Settlement Agreement, the prevailing party, will be awarded reasonable attorney’s fees, costs
and expenses.

END OF DOCUMENT

4

 

     IN WITNESS WHEREOF, “IBB” and “Odimo” have signed this Confidential Settlement Agreement
as of this 6th day of November 2006.

	 	 	 
	IBB Realty, LLC,

	 	Odimo Incorporated,
	a Limited Liability Company,

	 	a Delaware Corporation,
	 
	 	 
	By: /s/ Steven Kovacs

	 	By: /s/ Jeff Kornblum
	 

	 	 
	Steven Kovacs, Managing Partner

	 	Jeff Kornblum, President
	 
	 	 
	Witness: __________________________________________________________

	 	Witness: __________________________________________________________
	 
	 	 
	Witness: __________________________________________________________

	 	Witness: __________________________________________________________

	 	 	 	 	 
	STATE OF FLORIDA

	 	]	 	 
	COUNTY OF

	 	]
	 	ss:

     I HEREBY CERTIFY that on this day, before me, an officer duly authorized to take
acknowledgments, personally appeared __________ of IBB, Realty, LLC., to me personally known
to be the person(s) described in, or who produced _________________ as identification,
and who executed the foregoing instrument and acknowledged before me that he executed the same, and
who did/did not take an oath.

     WITNESS
my hand and official seal in the County and State last aforesaid,
this _____ day of
______________, 2006.

_______________________________

Notary Public, State of Florida

My Commission Expires:

	 	 	 	 	 
	STATE OF FLORIDA

	 	]	 	 
	COUNTY OF

	 	]
	 	ss:

     I HEREBY CERTIFY that on this day, before me, an officer duly authorized to take
acknowledgments, personally appeared __________ of Odimo Incorporated, to me personally known
to be the person(s) described in, or who produced
____________ as identification,
and who executed the foregoing instrument and acknowledged before me that he executed the same, and
who did/did not take an oath.

     WITNESS
my hand and official seal in the County and State last aforesaid,
this _______________ day of ________________, 2006.

_______________________________

Notary Public, State of Florida

My Commission Expires:

5EX-10.6 Form of Stock Option Agreement

 

EXHIBIT
10.6

HOME DIAGNOSTICS, INC.

[Name]

[Address]

     Re: Grant of Non-Qualified Stock Option

Dear
______________:

     Home Diagnostics, Inc., a Delaware corporation (the “Company”), is pleased to advise
you that, pursuant to the Company’s 2006 Equity Incentive Plan (the “Plan”), the Company
has granted to you (the “Optionee”) an option (the “Option”) to acquire shares of
the Company’s common stock, par value $.01 per share (“Common Stock”), as set forth below, subject
to the terms and conditions of the Plan and the terms and conditions set forth herein.

     The Option is not intended to be an “incentive stock option” within the meaning of Section 422
of the Code. Any capitalized terms used herein and not defined herein have the meaning set forth
in the Plan.

     1. Option.

     (a) Term. Subject to the terms and conditions set forth herein, the Company hereby
grants you (or such other persons as permitted by paragraph 5) an Option to purchase the Option
Shares at the exercise price per Option Share set forth on the signature page of this letter
agreement (the “Exercise Price”), payable upon exercise as set forth in paragraph 1(b)
below. The Option shall expire at the close of business on [Date],
20__ (the “Expiration
Date”), which is the tenth anniversary of the date of grant set forth on the signature page of
this letter agreement (the “Grant Date”), subject to earlier expiration as provided in
paragraph 2(c) below should your employment, directorship or other relationship or arrangement with
the Company or a Subsidiary terminate. The Exercise Price and the number and kind of shares of
Common Stock or other property for which the Option may be exercised shall be subject to adjustment
as provided in the Plan.

     (b) Payment of Option Price. Subject to paragraph 2 below, the Option may be
exercised in whole or in part upon payment of an amount (the “Option Price”) equal to the
product of (i) the Exercise Price and (ii) the number of Option Shares to be acquired. Payment of
the Option Price shall be made by one or more of the following means:

          (i) in cash (including check, bank draft, money order or wire transfer of immediately
available funds);

 

 

          (ii)
if permitted by the Company on the date of exercise, by delivery of outstanding shares of Common Stock owned by you for greater than six months (and not subject to any
substantial risk of forfeiture) with a Fair Market Value on the date of exercise equal to
the Option Price;

          (iii) by means of a broker assisted cashless exercise; or

          (iv) by any combination of the foregoing.

     2. Exercisability/Vesting and Expiration.

     (a) Normal Vesting. The Option granted hereunder may be exercised only to the extent
it has become vested, as indicated by the Vesting Dates of Option Shares set forth on the signature
page of this letter agreement.

     (b) Normal Expiration. In no event shall any part of the Option be exercisable after
the Expiration Date.

     (c) Effect on Vesting and Expiration of Employment Termination. Except as expressly
set forth in any written agreement between you and the Company or a Subsidiary (whether entered
into prior to or after the date of this letter agreement) and notwithstanding paragraphs 2(a) and
(b) above, the following special vesting and expiration rules shall apply if your employment with
the Company terminates prior to the Option becoming fully vested and/or prior to the Expiration
Date:

          (i) Termination Other than for Cause or Retirement. If your employment is
terminated by the Company or a Subsidiary for any reason other than Cause, death or
Disability or Retirement, or if you voluntarily leave the employ of the Company or a
Subsidiary other than as a result of the foregoing reasons, (A) any portion of the Option
that was exercisable on the date of such termination shall remain exercisable until the
ninetieth (90th) day immediately following such termination, but in no event
after the Expiration Date of the Option, and such portion of the Option shall expire and be
forfeited on the ninetieth (90th) day immediately following such termination and
(B) any portion of the Option that was not exercisable on the date of such termination shall
be forfeited immediately upon such termination.

          (ii) Termination for Cause. If your employment is terminated by the Company or
a Subsidiary for Cause, (A) any portion of the Option that was exercisable on the date of
such termination shall remain exercisable until the thirtieth (30th) day
immediately following such termination, but in no event after the Expiration Date of the
Option, and such portion of the Option shall expire and be forfeited on the thirtieth
(30th) day immediately following such termination, whether or not then
exercisable and (B) any portion of the Option that was not exercisable on the date of such
termination shall be forfeited immediately upon such termination.

          (iii) Termination Due to Death, Disability or Retirement. If your employment
is terminated by the Company or a Subsidiary due to your death or

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Disability, or if your
employment is terminated by reason of Retirement, (A) any portion of the Option that was
exercisable on the date of such termination shall remain exercisable until twelve (12)
months after such termination, but in no event after the Expiration Date of the Option, and
such portion of the Option shall expire and be forfeited on the first anniversary of the
date of such termination, whether or not then exercisable and (B) any portion of the Option
that was not exercisable on the date of such termination shall be forfeited immediately upon
such termination.

     (d) Effect on Vesting and Expiration of Termination of Directorship or Other Relationship
on Non-Employee with the Company or a Subsidiary. Except as expressly set forth in any written
agreement between you and the Company or a Subsidiary (whether entered into prior to or after the
date of this letter agreement) and notwithstanding paragraphs 2(a) and (b) above, the following
special vesting and expiration rules shall apply to any Optionee that is not an Employee of the
Company or a Subsidiary if such Optionee’s directorship, consultancy or other non-employment
relationship or arrangement with the Company or a Subsidiary terminates prior to the Option
becoming fully vested and/or prior to the Expiration Date: If your directorship, consultancy or
other non-employment relationship or arrangement is terminated by the Company or a Subsidiary or by
you for any reason, (A) any portion of the Option that was exercisable on the date of such
termination shall remain exercisable until twelve (12) months after such termination, but in no
event after the Expiration Date of the Option, and such portion of the Option shall expire and be
forfeited on the first anniversary of the date of such termination, whether or not then exercisable
and (B) any portion of the Option that was not exercisable on the date of such termination shall be
forfeited immediately upon such termination.

     (e) Acceleration of Vesting Upon Change in Control. Notwithstanding the vesting
schedules set forth in Section 2(a), the signature page hereto or elsewhere in this letter
agreement, all of the Options granted hereunder shall become immediately exercisable upon the
earlier to occur of (i) the one-year anniversary date of any Change in Control (as defined in the
Plan) or (ii) the involuntary termination of employment, directorship, relationship or other
arrangement of the Optionee with the Company following any Change in Control.

     3. Procedure for Exercise. Except as expressly set forth in any written agreement
between you and the Company or a Subsidiary (whether entered into prior to or after the date of
this letter agreement), you may exercise all or any portion of the Option, to the extent it has
vested and is exercisable, at any time and from time to time prior to the earlier of the Expiration
Date or the date specified in paragraph 2 above, by delivering written notice to the Company in the
form attached hereto as Exhibit A, together with payment of the Option Price in accordance
with the provisions of paragraph 1(b) above. The Option may not be exercised for a fraction of an
Option Share.

     4. Withholding of Taxes.

     (a) Participant Election. If permitted by the Company, you may elect to deliver
shares of Common Stock (or have the Company withhold Option Shares acquired upon
exercise of the Option) to satisfy, in whole or in part, the amount the Company is required to
withhold for taxes in connection with the exercise of the Option. Such election must be made on

3

 

or before the date the amount of tax to be withheld is determined. Once made, the election shall be
irrevocable. The Fair Market Value of the shares to be withheld or delivered will be the Fair
Market Value as of the date the amount of tax to be withheld is determined.

     (b) Company Requirement. The Company, to the extent permitted or required by law,
shall have the right to deduct from any payment of any kind (including salary or bonus) otherwise
due to you, an amount equal to any federal, state or local taxes of any kind required by law to be
withheld with respect to the delivery of Option Shares under this letter agreement.

     5. Transferability of Option. No Option shall be pledged, hypothecated or otherwise
encumbered or subject to any lien, obligation or liability of an Optionee to any party (other than
the Company or a Subsidiary), or assigned or transferred by an Optionee otherwise than by will or
the laws of descent and distribution or to a Beneficiary upon the death of an Optionee, and any
Option that may be exercisable shall be exercised during the lifetime of the Optionee only by the
Optionee or his or her guardian or legal representative, except that Options may be transferred to
one or more transferees during the lifetime of the Optionee, and may be exercised by such
transferees in accordance with the terms of such Option, but only if and to the extent such
transfers are permitted by the Committee, subject to any terms and conditions which the Committee
may impose thereon (which may include limitations the Committee may deem appropriate in order that
offers and sales under the Plan will meet applicable requirements of registration forms under the
Securities Act of 1933 specified by the Securities and Exchange Commission), provided, however,
that no such transfer may occur for consideration. A Beneficiary, transferee, or other person
claiming any rights under the Plan from or through any Optionee shall be subject to all terms and
conditions of the Plan and any Option document applicable to such Optionee, except as otherwise
determined by the Committee, and to any additional terms and conditions deemed necessary or
appropriate by the Committee. Unless the context requires otherwise, references herein to you or
Optionee are deemed to include any permitted transferee under this paragraph 5.

     6. Conformity with Plan. This letter agreement and the Option are intended to conform
in all respects with, and are subject to all applicable provisions of, the Plan (which is
incorporated herein by reference). Inconsistencies between this letter agreement and the Plan
shall be resolved in accordance with the terms of the Plan. By executing and returning the
enclosed copy of this letter agreement, you acknowledge your receipt of this letter agreement and
the Plan and agree to be bound by all of the terms of this letter agreement and the Plan.

     7. Rights of Participants. Nothing in this letter agreement shall interfere with or
limit in any way the right of the Company to terminate your employment or other performance of
services at any time, nor confer upon you any right to continue in the employ or as a director or
officer of, or in the performance of other services for, the Company or a Subsidiary for any period
of time, or to continue your present (or any other) rate of compensation or level of
responsibility. Nothing in this letter agreement shall confer upon you any right to be selected
again as a Plan participant, and nothing in the Plan or this letter agreement shall provide for any
adjustment to the
number of Option Shares subject to the Option upon the occurrence of subsequent events except
as provided in the Plan.

4

 

     8. Adjustments. In the event that any large, special and non-recurring dividend or
other distribution (whether in the form of cash or property other than Stock), recapitalization,
forward or reverse split, Stock dividend, reorganization, merger, consolidation, spin-off,
combination, repurchase, share exchange, liquidation, dissolution or other similar corporate
transaction or event affects the Stock such that an adjustment to an outstanding Option would be
necessary to prevent dilution or enlargement of Optionee’s rights, then the Committee shall, in an
equitable manner as determined by the Committee, adjust any or all of (i) the number and kind of
shares of Stock by which annual per-person Award limitations are measured under Section 5 of the
Plan, (ii) the number and kind of shares of Stock subject to or deliverable in respect of
outstanding Options and (iii) the exercise price, grant price or purchase price relating to any
Option; provided that, the fair value of Option immediately prior to the adjustment shall be equal
to the fair value of the Option immediately after the adjustment. In addition, the Committee is
authorized to make adjustments as provided in Section 10 (c) of the Plan, subject to the same
proviso contained in the foregoing sentence.

     9. Certain Definitions. For the purposes of this letter agreement, the following
terms have the meanings set forth below:

     “Cause” (i) has the same meaning given to such term in any employment agreement
between the Optionee and the Company or a Subsidiary; (ii) in the absence of a definition of Cause
contained in an applicable employment agreement, has the same meaning given to such term in any
applicable employee benefit or insurance plan of the Company or Subsidiary covering the Optionee;
and (iii) in the absence of any such applicable definition contained in a current employee benefit
or insurance plan of the Company or Subsidiary, means the occurrence of one or more of the
following events, as determined by the Committee:

          (A) commission of (x) a felony or (y) any crime or offense lesser than a felony involving the
property of the Company or a Subsidiary; or

          (B) conduct that has caused demonstrable and serious injury to the Company of subsidiary,
monetary or otherwise; or

          (C) willful refusal to perform or substantial disregard of duties properly assigned; or

          (D) breach of duty of loyalty to the Company or a Subsidiary or other act of fraud or
dishonesty with respect to the Company or a Subsidiary.

     “Director” means a member of the Board of Directors of the Company.

     “Disability” (i) has the same meaning given to such term in any employment agreement
between the Employee and the Company or a Subsidiary; (ii) in the absence of a definition of
Disability contained in an applicable employment agreement, has the same meaning as any definition
of Permanent Disability contained in the Company’s long-term disability
insurance policy in effect at such time; and (iii) in the absence of any such applicable
definition contained in a applicable employment agreement or long-term disability insurance policy
of the Company, means that the Employee is unable to perform material and substantial duties of

5

 

his/her regular occupation due to his/her sickness or injury for a period of thirteen consecutive
weeks or 90 days’ in the aggregate in any 12 month period; and he/she is not working at any job
during such period. As used herein, “material and substantial duties” means duties that are
normally required for the performance of the Employee’s regular occupation; and cannot be
reasonably omitted or modified, except that if an Employee is required to work on average in excess
of 40 hours per week, this requirement will be deemed met if the Employee is working or has the
capacity to work 40 hours per week.

     “Employee” means any person, including officers and Directors, employed by the Company
or a Subsidiary of the Company; provided, however, that neither service as a Director nor payment
of a director’s fee by the Company or a Subsidiary shall be sufficient to constitute “employment”
by the Company or a Subsidiary.

     “Family Member” has the meaning given to such term in General Instructions A.1(a)(5)
to Form S-8 under the Securities Act of 1933, as amended, and any successor thereto.

     “Option Shares” means (i) all shares of Common Stock issued or issuable upon the
exercise of the Option and (ii) all shares of Common Stock issued with respect to the Common Stock
referred to in clause (i) above by way of stock dividend or stock split or in connection with any
conversion, merger, consolidation or recapitalization or other reorganization affecting the Common
Stock.

     “Retirement” or “Retires” means, in the case of an Employee, attainment of age 65 or
such later date as the Committee may determine at the time of grant. An Optionee must, however,
voluntarily terminate his or her employment in order for his or her termination of employment to be
for “Retirement.”

     “Subsidiary” means a corporation or other entity of which outstanding shares or
ownership interests representing 50% or more of the combined voting power of such corporation or
other entity entitled to elect the management thereof, or such lesser percentage as may be approved
by the Committee, are owned directly or indirectly by the Company.

     Capitalized terms used in this letter agreement without definition shall have the respective
meanings ascribed to them in the Plan.

     10. Successors and Assigns. Except as otherwise expressly provided herein, all
covenants and agreements contained in this letter agreement by or on behalf of any of the parties
hereto shall bind and inure to the benefit of the respective successors and permitted assigns of
the parties hereto whether so expressed or not.

     11. Severability. Whenever possible, each provision of this letter agreement shall be
interpreted in such manner as to be effective and valid under applicable law, but if any provision
of this letter agreement is held to be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of this letter agreement.

6

 

     12. Counterparts. This letter agreement may be executed simultaneously in two or more
counterparts, each of which shall constitute an original, but all of which taken together shall
constitute one and the same letter agreement.

     13. Descriptive Headings. The descriptive headings of this Agreement are inserted for
convenience only and do not constitute a part of this Agreement.

     14. Governing Law. THE VALIDITY, CONSTRUCTION, INTERPRETATION, ADMINISTRATION AND
EFFECT OF THE PLAN, AND OF ITS RULES AND REGULATIONS, AND RIGHTS RELATING TO THE PLAN AND TO THIS
LETTER AGREEMENT, SHALL BE GOVERNED BY THE SUBSTANTIVE LAWS, BUT NOT THE CHOICE OF LAW RULES, OF
THE STATE OF DELAWARE.

     15. Notices. All notices, demands or other communications to be given or delivered
under or by reason of the provisions of this letter agreement shall be in writing and shall be
deemed to have been given when (i) delivered personally, (ii) mailed by certified or registered
mail, return receipt requested and postage prepaid, (iii) sent by facsimile or (iv) sent by
reputable overnight courier, to the recipient. Such notices, demands and other communications
shall be sent to you at the address specified in this letter
agreement and to the Company at [Address] Attn: [Name/Title], or to such other
address or to the attention of such other person as the recipient party has specified by prior
written notice to the sending party.

     16. Entire Agreement. This letter agreement, any written agreement between you and
the Company or a Subsidiary to the extent contemplated by paragraph 2(c) hereof, and the terms of
the Plan constitute the entire understanding between you and the Company, and supersede all other
agreements, whether written or oral, with respect to your acquisition of the Option Shares.

* * * * *

7

 

Signature Page to Stock Option Award Agreement

	 	 	 	 	 	 	 
	 

	 	Number of Option Shares:	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	Date of Grant:	 	  
	 
	 	 	 	 	 	 
	 	 	Exercise Price per Option Share:	 	  
	 
	 	 	 	 	 	 
	 

	 	Vesting Dates of Option Shares:
	 	  
	 
	 	 	 	 	 	 
	 

	 	 	 	  
	 
	 	 	 	 	 	 
	 

	 	 	 	  
	 
	 	 	 	 	 	 
	 	 	Expiration Date of All Option
Shares:	 	  

     Please execute the extra copy of this letter agreement in the space below and return it to the
Company to confirm your understanding and acceptance of the agreements contained in this letter
agreement.

	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	 	 	HOME DIAGNOSTICS, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:
	 	 	 	 

	 	 	 
	Enclosures:

	 	Extra copy of this letter agreement
	 

	 	Copy of the Plan

     The undersigned hereby acknowledges having read this letter agreement and the Plan and hereby
agrees to be bound by all provisions set forth herein and in the Plan.

	 	 	 
	 

	 	OPTIONEE
	 
	 	 
	 

	 	 

 

 

EXHIBIT A

Form of Letter to be Used to Exercise Stock Option

_______________________________ ____, _____________ Date

Home Diagnostics, Inc.

[Address]

Attention: [name]

     I
wish to exercise the stock option granted on [date]___, 20___ and evidenced by a Stock Option
Award Agreement dated as of that date, to acquire              shares of Common Stock of
Home Diagnostics, Inc., at an Option Price of
$______ per share, for an aggregate Option Price of
$___. In accordance with the provisions of paragraph 1 of the Stock Option Award Agreement,
I wish to make payment of the exercise price (please check all that apply):

	 	 	 
	 
	 	 

	o
	 	in cash

	 
	 	 

	o
	 	if permitted by the Company, by delivery of shares of Common Stock
held by me for at least six-months

	 
	 	 

	o
	 	by means of a broker assisted cashless exercise

	 
	 	 

	o
	 	by a combination of the foregoing, as more fully described below:

	 
	 	 

	 	 	___% (or $___) in cash

	 	 	___% (or $___) by delivery of shares of Common Stock held by me
for at least six-months

	 	 	___% (or $___) by means of a broker assisted cashless exercise

Please issue these shares in the following name:

 

Name

 

Address

Very truly yours,

 

Signature

 

Typed or Printed Name

 

Social Security Number

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