FLOTEK INDUSTRIES, INC.
STAND-ALONE TIME-BASED STOCK OPTION AWARD AGREEMENT
STOCK OPTION AWARD AGREEMENT
Subject to the terms and conditions of the Notice of Stock Option Award (the Notice), this Flotek Industries, Inc. Stand-Alone Time-Based Stock Option Award Agreement (this Award Agreement), Flotek Industries, Inc., a Delaware corporation (the Company), hereby grants the individual set forth in the Notice (the Participant) a stock option (the Option) to purchase shares of Common Stock. Unless otherwise specifically indicated, all terms used in this Award Agreement have the meanings set forth in Section 8 or the Notice.
1. Grant of the Option. The principal features of the Option, including the number of Optioned Shares subject to the Option, are set forth in the Notice. The Option is a non-statutory stock option, that by its terms, is not intended to qualify for incentive stock option treatment. The exercise price equals the fair market value of a share of Common Stock on the Date of Grant. The exercise price of the Option may not be repriced without stockholder approval.
2. Vesting Schedule and Risk of Forfeiture.
(a) Vesting Schedule. Subject to the Participants Continuous Service with the Company and any other limitations set forth in the Notice or this Award Agreement, the Option will vest in accordance with the Vesting Schedule provided in the Notice.
(b) Risk of Forfeiture. The Option will be subject to a risk of forfeiture until such time the risk of forfeiture lapses on the Vesting Date set forth in the Notice, or at such later date as provided Section 5(b), (c) or (d) of the Employment Agreement. Except as provided Section 5(b), (c) or (d) of the Employment Agreement, all or any portion of the unvested Option subject to the foregoing risk of forfeiture will immediately and automatically be forfeited and terminated upon the first day the Participant fails to provide Continuous Service to the Company. Additionally, vested and unexercised Optioned Shares and unvested Optioned Shares will immediately and automatically be forfeited upon the Participants employment with the Company being validly terminated by the Company for Cause. The Company may implement any forfeiture under this Section 2(b) in a unilateral manner, without the Participants consent, and with no payment to the Participant, cash or otherwise, for the forfeited Optioned Shares.
3. Exercise of Option.
(a) Right to Exercise. The Optioned Shares will be exercisable during their term cumulatively according to the Vesting Schedule and the applicable provisions of the Notice and the Award Agreement; however, the Optioned Shares may not be exercised for a fraction of a share of Common Stock. Additionally, and notwithstanding anything in the Notice or this Award Agreement, in connection with or following the termination or interruption of Participants Continuous Service for any reason, the Participant may exercise vested Optioned Shares only during, and not after, the Post-Termination Exercise Period set forth in the Notice. Vested Optioned Shares will automatically expire, and the vested Optioned Shares will automatically terminate, upon the end of the Post-Termination Exercise Period set forth in the Notice. Finally, all Optioned Shares will automatically expire and terminate upon the Expiration Date (as set forth in the Notice) to the extent not then exercised. Thereafter, no vested Optioned Shares may be exercised.