Exhibit 10.31
SALON MEDIA GROUP, INC.
NON-PLAN STOCK OPTION AGREEMENT
Salon Media Group, Inc. has granted to Xxxxx Xxxxxx (the "Optionee") an
option (the "Option") to purchase certain shares of Stock upon the terms and
conditions set forth in the Stock Option Agreement (the "Option Agreement").
1. DEFINITIONS AND CONSTRUCTION.
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1.1 Definitions. Unless otherwise defined herein, capitalized terms
shall have the meanings set forth below:
(a) "Date of Option Grant" means February 7, 2005.
(b) "Number of Option Shares" means 1,000,000 shares of Stock, as
adjusted from time to time pursuant to Section 9.
(c) "Exercise Price" means $ 0.14 per share of Stock, as adjusted
from time to time pursuant to Section 9.
(d) "Initial Vesting Date" means the Date of Option Grant.
(e) "Vested Shares" means, on any relevant date, except as
otherwise provided herein, that portion (rounded down to the nearest whole
share) of the Number of Option Shares determined by multiplying the Number of
Option Shares by the "Vested Ratio" determined as of such date as follows:
Vested Ratio
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Prior to Initial Vesting Date 0
On Initial Vesting Date, provided the
Optionee's Service has not terminated
prior to such date 1/2
Plus:
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On the one year anniversary of the
Optionee's continuous Service from the
Initial Vesting Date, an additional 1/2
(f) "Option Expiration Date" means the date ten (10) years after
the Date of Option Grant.
(g) "Affiliate" means (i) an entity, other than a Parent
Corporation, that directly, or indirectly through one or more intermediary
entities, controls the Company or
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(ii) an entity, other than a Subsidiary Corporation, that is controlled by the
Company directly, or indirectly through one or more intermediary entities. For
this purpose, the term "control" (including the term "controlled by") means the
possession, direct or indirect, of the power to direct or cause the direction of
the management and policies of the relevant entity, whether through the
ownership of voting securities, by contract or otherwise; or shall have such
other meaning assigned such term for the purposes of registration on Form S-8
under the Securities Act.
(h) "Board" means the Board of Directors of the Company. If one
or more committees have been appointed by the Board to administer the Option
Agreement, "Board" shall also mean such committee(s).
(i) "Code" means the Internal Revenue Code of 1986, as amended,
and any applicable regulations promulgated thereunder.
(j) "Company" means Salon Media Group, Inc., a Delaware
corporation, or any successor corporation thereto.
(k) "Consultant" means a person engaged to provide consulting
services (other than as an Employee or a Director) to a Participating Company.
(l) "Director" means the inability of the Optionee, in the
opinion of a qualified physician acceptable to the Company, to perform the major
duties of the Optionee's position with the Participating Company Group because
of the sickness or injury of the Optionee.
(m) "Disability" means the permanent and total disability of the
Optionee within the meaning of Section 22(e)(3) of the Code.
(n) "Employee" means any person treated as an employee (including
an Officer or a Director who is also treated as an employee) in the records of a
Participating Company; provided, however, that neither service as a Director nor
payment of a director's fee shall be sufficient to constitute employment for
this purpose. The Company shall determine in good faith and in the exercise of
its discretion whether an individual has become or has ceased to be an Employee
and the effective date of such individual's employment or termination of
employment, as the case may be. For purposes of an individual's rights, if any,
under the terms of the Plan as of the time of the Company's determination of
whether or not the individual is an Employee, all such determinations by the
Company shall be final, binding and conclusive as to such rights, if any,
notwithstanding that the Company or any court of law or governmental agency
subsequently makes a contrary determination as to such individual's status as an
Employee.
(o) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
(p) "Fair Market Value" means, as of any date, the value of a
share of stock or other property as determined by the Board, in its sole
discretion, or by the Company, in
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its sole discretion, if such determination is expressly allocated to the Company
herein, subject to the following:
(i) If, on such date, the Stock is listed on a national or
regional securities exchange or market system, the Fair Market Value of a share
of Stock shall be the closing sale price of a share of Stock (or the mean of the
closing bid and asked prices of a share of Stock if the Stock is so quoted
instead) as quoted on the Nasdaq National Market, The Nasdaq SmallCap Market,
OTC Bulletin Board or such other national or regional securities exchange or
market system constituting the primary market for the Stock, as reported in The
Wall Street Journal or such other source as the Company deems reliable. If the
relevant date does not fall on a day on which the Stock has traded on such
securities exchange or market system, the date on which the Fair Market Value
shall be established shall be the last day on which the Stock was so traded
prior to the relevant date, or such other appropriate day as shall be determined
by the Board, in its discretion.
(ii) If, on such date, the Stock is not listed on a national
or regional securities exchange or market system, the Fair Market Value of a
share of Stock shall be as determined by the Board without regard to any
restriction other than a restriction which, by its terms, will never lapse.
(q) "Insider" means an Officer, a Director of the Company or
other person whose transactions in Stock are subject to Section 16 of the
Exchange Act.
(r) "Officer" means any person designated by the Board as an
officer of the Company.
(s) "Parent Corporation" means any present or future "parent
corporation" of the Company, as defined in Section 424(e) of the Code.
(t) "Participating Company" means the Company or any Parent
Corporation or Subsidiary Corporation or Affiliate.
(u) "Participating Company Group" means, at any point in time,
all corporations collectively which are then Participating Companies.
(v) "Rule 16b-3" means Rule 16b-3 under the Exchange Act, as
amended from time to time, or any successor rule or regulation.
(w) "Securities Act" means the Securities Act of 1933, as
amended.
(x) "Service" means the Optionee's employment or service with the
Participating Company Group, whether in the capacity of an Employee, a Director
or a Consultant. The Optionee's Service shall not be deemed to have terminated
merely because of a change in the capacity in which the Optionee renders Service
to the Participating Company Group or a change in the Participating Company for
which the Optionee renders such Service, provided that there is no interruption
or termination of the Optionee's Service. Furthermore, the Optionee's Service
with the Participating Company Group shall not be deemed to have terminated if
the Optionee takes any military leave, sick leave, or other bona fide leave of
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absence approved by the Company. Notwithstanding the foregoing, unless otherwise
designated by the Company or required by law, a leave of absence shall not be
treated as Service for purposes of determining the Optionee's Vested Shares.
Except as otherwise provided by the Board, in its discretion, the Optionee's
Service shall be deemed to have terminated either upon an actual termination of
Service or upon the corporation for which the Optionee performs Service ceasing
to be a Participating Company. Subject to the foregoing, the Company, in its
sole discretion, shall determine whether the Optionee's Service has terminated
and the effective date of such termination.
(y) "Stock" means the common stock of the Company, as adjusted
from time to time in accordance with Section 9.
(z) "Subsidiary Corporation" means any present or future
"subsidiary corporation" of the Company, as defined in Section 424(f) of the
Code.
1.2 Construction. Captions and titles contained herein are for
convenience only and shall not affect the meaning or interpretation of any
provision of this Option Agreement. Except when otherwise indicated by the
context, the singular shall include the plural and the plural shall include the
singular. Use of the term "or" is not intended to be exclusive, unless the
context clearly requires otherwise.
2. TAX STATUS OF OPTION.
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This Option is intended to be a nonstatutory stock option and shall
not be treated as an incentive stock option within the meaning of Section 422(b)
of the Code.
3. ADMINISTRATION.
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All questions of interpretation concerning this Option Agreement shall
be determined by the Board. All determinations by the Board shall be final and
binding upon all persons having an interest in the Option. Any Officer shall
have the authority to act on behalf of the Company with respect to any matter,
right, obligation, or election which is the responsibility of or which is
allocated to the Company herein, provided the Officer has apparent authority
with respect to such matter, right, obligation, or election.
4. EXERCISE OF THE OPTION.
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4.1 Right to Exercise. Except as otherwise provided herein, the Option
shall be exercisable on and after the Initial Vesting Date and prior to the
termination of the Option (as provided in Section 6) in an amount not to exceed
the number of Vested Shares less the number of shares previously acquired upon
exercise of the Option. In no event shall the Option be exercisable for more
shares than the Number of Option Shares, as adjusted pursuant to Section 9.
4.2 Method of Exercise. Exercise of the Option shall be by written
notice to the Company which must state the election to exercise the Option, the
number of whole shares of Stock for which the Option is being exercised and such
other representations and agreements as to the Optionee's investment intent with
respect to such shares as may be required pursuant to the provisions of this
Option Agreement. The written notice must be signed by the Optionee and
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must be delivered in person, by certified or registered mail, return receipt
requested, by confirmed facsimile transmission, or by such other means as the
Company may permit, to the Chief Financial Officer of the Company, or other
authorized representative of the Participating Company Group, prior to the
termination of the Option as set forth in Section 6, accompanied by full payment
of the aggregate Exercise Price for the number of shares of Stock being
purchased. The Option shall be deemed to be exercised upon receipt by the
Company of such written notice and the aggregate Exercise Price.
4.3 Payment of Exercise Price.
(a) Forms of Consideration Authorized. Except as otherwise
provided below, payment of the aggregate Exercise Price for the number of shares
of Stock for which the Option is being exercised shall be made (i) in cash, by
check, or cash equivalent, (ii) by tender to the Company, or attestation to the
ownership, of whole shares of Stock owned by the Optionee having a Fair Market
Value not less than the aggregate Exercise Price, (iii) by means of a Cashless
Exercise, as defined in Section 4.3(b), or (iv) by any combination of the
foregoing.
(b) Limitations on Forms of Consideration.
(i) Tender of Stock. Notwithstanding the foregoing, the
Option may not be exercised by tender to the Company, or attestation to the
ownership, of shares of Stock to the extent such tender or attestation would
constitute a violation of the provisions of any law, regulation or agreement
restricting the redemption of the Company's stock. The Option may not be
exercised by tender to the Company, or attestation to the ownership, of shares
of Stock unless such shares either have been owned by the Optionee for more than
six (6) months (and not used for another option exercise by attestation during
such period) or were not acquired, directly or indirectly, from the Company.
(ii) Cashless Exercise. A "Cashless Exercise" means the
delivery of a properly executed notice together with irrevocable instructions to
a broker in a form acceptable to the Company providing for the assignment to the
Company of the proceeds of a sale or loan with respect to some or all of the
shares of Stock acquired upon the exercise of the Option pursuant to a program
or procedure approved by the Company (including, without limitation, through an
exercise complying with the provisions of Regulation T as promulgated from time
to time by the Board of Governors of the Federal Reserve System). The Company
reserves, at any and all times, the right, in the Company's sole and absolute
discretion, to decline to approve or terminate any such program or procedure.
4.4 Tax Withholding. At the time the Option is exercised, in whole or
in part, or at any time thereafter as requested by the Company, the Optionee
hereby authorizes withholding from payroll and any other amounts payable to the
Optionee, and otherwise agrees to make adequate provision for (including by
means of a Cashless Exercise to the extent permitted by the Company), any sums
required to satisfy the federal, state, local and foreign tax withholding
obligations of the Participating Company Group, if any, which arise in
connection with the Option, including, without limitation, obligations arising
upon (i) the exercise, in whole or in part, of the Option and (ii) the transfer,
in whole or in part, of any shares acquired upon
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exercise of the Option. The Option is not exercisable unless the tax withholding
obligations of the Participating Company Group are satisfied. Accordingly, the
Company shall have no obligation to deliver shares of Stock until the tax
withholding obligations of the Participating Company Group have been satisfied
by the Optionee.
4.5 Certificate Registration. Except in the event the Exercise Price
is paid by means of a Cashless Exercise, the certificate for the shares as to
which the Option is exercised shall be registered in the name of the Optionee,
or, if applicable, in the names of the heirs of the Optionee.
4.6 Restrictions on Grant of the Option and Issuance of Shares. The
grant of the Option and the issuance of shares of Stock upon exercise of the
Option shall be subject to compliance with all applicable requirements of
federal, state or foreign law with respect to such securities. The Option may
not be exercised if the issuance of shares of Stock upon exercise would
constitute a violation of any applicable federal, state or foreign securities
laws or other law or regulations or the requirements of any stock exchange or
market system upon which the Stock may then be listed. In addition, the Option
may not be exercised unless (i) a registration statement under the Securities
Act shall at the time of exercise of the Option be in effect with respect to the
shares issuable upon exercise of the Option or (ii) in the opinion of legal
counsel to the Company, the shares issuable upon exercise of the Option may be
issued in accordance with the terms of an applicable exemption from the
registration requirements of the Securities Act. THE OPTIONEE IS CAUTIONED THAT
THE OPTION MAY NOT BE EXERCISED UNLESS THE FOREGOING CONDITIONS ARE SATISFIED.
ACCORDINGLY, THE OPTIONEE MAY NOT BE ABLE TO EXERCISE THE OPTION WHEN DESIRED
EVEN THOUGH THE OPTION IS VESTED. The inability of the Company to obtain from
any regulatory body having jurisdiction the authority, if any, deemed by the
Company's legal counsel to be necessary to the lawful issuance and sale of any
shares subject to the Option shall relieve the Company of any liability in
respect of the failure to issue or sell such shares as to which such requisite
authority shall not have been obtained. As a condition to the exercise of the
Option, the Company may require the Optionee to satisfy any qualifications that
may be necessary or appropriate, to evidence compliance with any applicable law
or regulation and to make any representation or warranty with respect thereto as
may be requested by the Company.
4.7 Fractional Shares. The Company shall not be required to issue
fractional shares upon the exercise of the Option.
5. NONTRANSFERABILITY OF THE OPTION.
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The Option may be exercised during the lifetime of the Optionee only
by the Optionee or the Optionee's guardian or legal representative and may not
be assigned or transferred in any manner except by will or by the laws of
descent and distribution. Following the death of the Optionee, the Option, to
the extent provided in Section 7, may be exercised by the Optionee's legal
representative or by any person empowered to do so under the deceased Optionee's
will or under the then applicable laws of descent and distribution.
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6. TERMINATION OF THE OPTION.
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The Option shall terminate and may no longer be exercised after the
first to occur of (a) the close of business on the Option Expiration Date, (b)
the close of business on the last date for exercising the Option following
termination of the Optionee's Service as described in Section 7, or (c) a Change
in Control to the extent provided in Section 8.
7. EFFECT OF TERMINATION OF SERVICE.
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7.1 Option Exercisability.
(a) Disability. If the Optionee's Service terminates because of
the Disability of the Optionee, the Option, to the extent unexercised and
exercisable on the date on which the Optionee's Service terminated, may be
exercised by the Optionee (or the Optionee's guardian or legal representative)
at any time prior to the expiration of twelve (12) months after the date on
which the Optionee's Service terminated, but in any event no later than the
Option Expiration Date.
(b) Death. If the Optionee's Service terminates because of the
death of the Optionee, the Option, to the extent unexercised and exercisable on
the date on which the Optionee's Service terminated, may be exercised by the
Optionee's legal representative or other person who acquired the right to
exercise the Option by reason of the Optionee's death at any time prior to the
expiration of twelve (12) months after the date on which the Optionee's Service
terminated, but in any event no later than the Option Expiration Date. The
Optionee's Service shall be deemed to have terminated on account of death if the
Optionee dies within three (3) months after the Optionee's termination of
Service.
(c) Termination for Cause. Notwithstanding any other provision of
this Option Agreement, if the Optionee's Service is terminated for Cause (as
defined below), the Option shall terminate and cease to be exercisable on the
effective date of such termination of Service. Unless otherwise defined in a
contract of employment or service between the Optionee and a Participating
Company, for purposes of this Option Agreement "Cause" shall mean any of the
following: (i) the Optionee's theft, dishonesty, or falsification of any
Participating Company documents or records; (ii) the Optionee's improper use or
disclosure of a Participating Company's confidential or proprietary information;
(iii) any action by the Optionee which has a material detrimental effect on a
Participating Company's reputation or business; (iv) the Optionee's failure or
inability to perform any reasonable assigned duties after written notice from a
Participating Company of, and a reasonable opportunity to cure, such failure or
inability; (v) any material breach by the Optionee of any employment agreement
between the Optionee and a Participating Company, which breach is not cured
pursuant to the terms of such agreement; or (vi) the Optionee's conviction
(including any plea of guilty or nolo contendere) of any criminal act which
impairs the Optionee's ability to perform his or her duties with a Participating
Company.
(d) Other Termination of Service. If the Optionee's Service
terminates for any reason, except Disability, death or Cause, the Option, to the
extent
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unexercised and exercisable by the Optionee on the date on which the Optionee's
Service terminated, may be exercised by the Optionee at any time prior to the
expiration of three (3) months after the date on which the Optionee's Service
terminated, but in any event no later than the Option Expiration Date.
7.2 Extension if Exercise Prevented by Law. Notwithstanding the
foregoing, other than for Cause, if the exercise of the Option within the
applicable time periods set forth in Section 7.1 is prevented by the provisions
of Section 4.6, the Option shall remain exercisable until three (3) months after
the date the Optionee is notified by the Company that the Option is exercisable,
but in any event no later than the Option Expiration Date.
7.3 Extension if Optionee Subject to Section 16(b). Notwithstanding
the foregoing, other than for Cause, if a sale within the applicable time
periods set forth in Section 7.1 of shares acquired upon the exercise of the
Option would subject the Optionee to suit under Section 16(b) of the Exchange
Act, the Option shall remain exercisable until the earliest to occur of (i) the
tenth (10th) day following the date on which a sale of such shares by the
Optionee would no longer be subject to such suit, (ii) the one hundred and
ninetieth (190th) day after the Optionee's termination of Service, or (iii) the
Option Expiration Date.
8. CHANGE IN CONTROL.
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8.1 Definitions.
(a) An "Ownership Change Event" shall be deemed to have occurred
if any of the following occurs with respect to the Company: (i) the direct or
indirect sale or exchange in a single or series of related transactions by the
stockholders of the Company of more than fifty percent (50%) of the voting stock
of the Company; (ii) a merger or consolidation in which the Company is a party;
(iii) the sale, exchange, or transfer of all or substantially all of the assets
of the Company; or (iv) a liquidation or dissolution of the Company.
(b) A "Change in Control" shall mean an Ownership Change Event or
a series of related Ownership Change Events (collectively, a "Transaction")
wherein the stockholders of the Company immediately before the Transaction do
not retain immediately after the Transaction, in substantially the same
proportions as their ownership of shares of the Company's voting stock
immediately before the Transaction, direct or indirect beneficial ownership of
more than fifty percent (50%) of the total combined voting power of the
outstanding voting securities of the Company or, in the case of a Transaction
described in Section 8.1(a)(iii), the corporation or other business entity to
which the assets of the Company were transferred (the "Transferee"), as the case
may be. For purposes of the preceding sentence, indirect beneficial ownership
shall include, without limitation, an interest resulting from ownership of the
voting securities of one or more corporations or other business entities which
own the Company or the Transferee, as the case may be, either directly or
through one or more subsidiary corporations or other business entities. The
Board shall have the right to determine whether multiple sales or exchanges of
the voting securities of the Company or multiple Ownership Change Events are
related, and its determination shall be final, binding and conclusive.
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8.2 Effect of Change in Control on Option. In the event of a Change in
Control, the surviving, continuing, successor, or purchasing corporation or
other business entity or parent thereof, as the case may be (the "Acquiror"),
may, without the consent of the Optionee, either assume the Company's rights and
obligations under the Option or substitute for the Option a substantially
equivalent option for the Acquiror's stock. The Option shall terminate and cease
to be outstanding effective as of the date of the Change in Control to the
extent that the Option is neither assumed or substituted for by the Acquiror in
connection with the Change in Control nor exercised as of the date of the Change
in Control. Notwithstanding the foregoing, shares acquired upon exercise of the
Option prior to the Change in Control and any consideration received pursuant to
the Change in Control with respect to such shares shall continue to be subject
to all applicable provisions of this Option Agreement except as otherwise
provided herein. Furthermore, notwithstanding the foregoing, if the corporation
the stock of which is subject to the Option immediately prior to an Ownership
Change Event described in Section 8.1(a)(i) constituting a Change in Control is
the surviving or continuing corporation and immediately after such Ownership
Change Event less than fifty percent (50%) of the total combined voting power of
its voting stock is held by another corporation or by other corporations that
are members of an affiliated group within the meaning of Section 1504(a) of the
Code without regard to the provisions of Section 1504(b) of the Code, the Option
shall not terminate unless the Board otherwise provides in its discretion.
9. ADJUSTMENTS FOR CHANGES IN CAPITAL STRUCTURE.
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Subject to any required action by the stockholders of the Company, in
the event of any change in the Stock effected without receipt of consideration
by the Company, whether through merger, consolidation, reorganization,
reincorporation, recapitalization, reclassification, stock dividend, stock
split, reverse stock split, split-up, split-off, spin-off, combination of
shares, exchange of shares, or similar change in the capital structure of the
Company, or in the event of payment of a dividend or distribution to the
stockholders of the Company in a form other than Stock (excepting normal cash
dividends) that has a material effect on the Fair Market Value of shares of
Stock, appropriate and proportionate adjustments shall be made in the number,
Exercise Price and class of shares subject to the Option, in order to prevent
dilution or enlargement of the Optionee's rights under the Option. For purposes
of the foregoing, conversion of any convertible securities of the Company shall
not be treated as "effected without receipt of consideration by the Company."
Any fractional share resulting from an adjustment pursuant to this Section 9
shall be rounded down to the nearest whole number, and in no event may the
purchase price of the Option be decreased to an amount less than the par value,
if any, of the stock subject to the Option. Such adjustments shall be determined
by the Board, and its determination shall be final, binding and conclusive.
10. RIGHTS AS A STOCKHOLDER, EMPLOYEE OR CONSULTANT.
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The Optionee shall have no rights as a stockholder with respect to any
shares covered by the Option until the date of the issuance of a certificate for
the shares for which the Option has been exercised (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company). No adjustment shall be made for dividends, distributions
or other rights for which the record date is prior to the date such certificate
is issued, except as provided in Section 9. If the Optionee is an Employee, the
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Optionee understands and acknowledges that, except as otherwise provided in a
separate, written employment agreement between a Participating Company and the
Optionee, the Optionee's employment is "at will" and is for no specified term.
Nothing in this Option Agreement shall confer upon the Optionee any right to
continue in the Service of a Participating Company or interfere in any way with
any right of the Participating Company Group to terminate the Optionee's Service
as an Employee or Consultant, as the case may be, at any time.
11. REPRESENTATIONS AND WARRANTIES.
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In connection with the receipt of the Option and any acquisition of
shares upon the exercise thereof (collectively, the "Securities"), the Optionee
hereby agrees, represents and warrants as follows:
11.1 Investment Intent. The Optionee is acquiring the Securities
solely for the Optionee's own account for investment and not with a view to or
for sale in connection with any distribution of the Securities or any portion
thereof and not with any present intention of selling, offering to sell or
otherwise disposing of or distributing the Securities or any portion thereof in
any transaction other than a transaction exempt from registration under the
Securities Act. The Optionee further represents that the entire legal and
beneficial interest of the Securities is being acquired, and will be held, for
the account of the Optionee only and neither in whole nor in part for any other
person.
11.2 Absence of Solicitation. The Optionee was not presented with or
solicited by any form of general solicitation or general advertising, including,
but not limited to, any advertisement, article, notice, or other communication
published in any newspaper, magazine, or similar media, or broadcast over
television, radio or similar communications media, or presented at any seminar
or meeting whose attendees have been invited by any general solicitation or
general advertising.
11.3 Capacity to Protect Interests. The Optionee has (i) a preexisting
personal or business relationship with the Company or any of its Officers,
directors, or controlling persons, consisting of personal or business contacts
of a nature and duration to enable the Optionee to be aware of the character,
business acumen and general business and financial circumstances of the person
with whom such relationship exists, or (ii) such knowledge and experience in
financial and business matters as to make the Optionee capable of evaluating the
merits and risks of an investment in the Securities and to protect the
Optionee's own interests in the transaction, or (iii) both such relationship and
such knowledge and experience.
11.4 Reliance by Company. The Optionee understands that the Option and
any shares acquired upon exercise of the Option have not been qualified under
the Corporate Securities Law of 1968, as amended, of the State of California by
reason of a specific exemption therefrom, which exemption depends upon, among
other things, the bona fide nature of the Optionee's representations as
expressed herein. The Optionee understands that the Company is relying on the
Optionee's representations and warrants that the Company is entitled to rely on
such representations and that such reliance is reasonable.
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12. LEGENDS.
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12.1 The Company may at any time place legends referencing any
applicable federal, state or foreign securities law restrictions on all
certificates representing shares of stock subject to the provisions of this
Option Agreement. The Optionee shall, at the request of the Company, promptly
present to the Company any and all certificates representing shares acquired
pursuant to the Option in the possession of the Optionee in order to carry out
the provisions of this Section.
13. MISCELLANEOUS PROVISIONS.
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13.1 Further Instruments. The parties hereto agree to execute such
further instruments and to take such further action as may reasonably be
necessary to carry out the intent of this Option Agreement.
13.2 Binding Effect. Subject to the restrictions on transfer set forth
herein, this Option Agreement shall inure to the benefit of and be binding upon
the parties hereto and their respective heirs, executors, administrators,
successors and assigns.
13.3 Termination or Amendment. The Board may terminate or amend the
Option at any time; provided, however, that except as provided in Section 8.2 in
connection with a Change in Control, no such termination or amendment may
adversely affect the Option or any unexercised portion hereof without the
consent of the Optionee unless such termination or amendment is necessary to
comply with any applicable law or government regulation. No amendment or
addition to this Option Agreement shall be effective unless in writing.
13.4 Notices. Any notice required or permitted hereunder shall be
given in writing and shall be deemed effectively given (except to the extent
that this Option Agreement provides for effectiveness only upon actual receipt
of such notice) upon personal delivery or upon deposit in the United States Post
Office, by registered or certified mail, or with an overnight courier service
with postage and fees prepaid, addressed to the other party at the address shown
below that party's signature or at such other address as such party may
designate in writing from time to time to the other party.
13.5 Integrated Agreement. The Option Agreement constitutes the entire
understanding and agreement of the Optionee and the Participating Company Group
with respect to the subject matter contained herein and supersedes any prior
agreements, understandings, restrictions, representations, or warranties among
the Optionee and the Participating Company Group with respect to such subject
matter other than those as set forth or provided for herein. To the extent
contemplated herein, the provisions of the Notice and the Option Agreement shall
survive any exercise of the Option and shall remain in full force and effect.
13.6 Applicable Law. This Option Agreement shall be governed by the
laws of the State of California as such laws are applied to agreements between
California residents entered into and to be performed entirely within the State
of California.
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13.7 Counterparts. The Notice may be executed in counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
Salon Media Group, Inc.
By: /s/ Xxxxxxxxx Xxxxxxxxx
Title: President, Chief Financial Officer
and Secretary
Address:
00 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
The Optionee represents that the Optionee has read and is familiar with the
terms and provisions of this Option Agreement and hereby accepts the option
subject to all of the terms and provisions thereof. The Optionee hereby agrees
to accept as binding, conclusive and final all decisions or interpretations of
the Board upon any questions arising under this Option Agreement.
OPTIONEE
Date: February 7, 2005 Signature: /s/ Xxxxx Xxxxxx
Xxxxx Xxxxxx
---------------------------------------
Name Printed
Optionee Address:
00 Xxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000
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Optionee: _______________________________
Date: _______________________________
STOCK OPTION EXERCISE NOTICE
Salon Media Group, Inc.
Attention: Chief Financial Officer
One Xxxxxx Center
000 Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxxxxxx, XX 00000
Ladies and Gentlemen:
1. Option. I was granted a nonstatutory stock option (the "Option") to
purchase shares of the common stock (the "Shares") of Salon Media Group, Inc.
(the "Company") pursuant to a Stock Option Agreement (the "Option Agreement") as
follows:
Date of Option Grant: _________________________
Number of Option Shares: _________________________
Exercise Price per Share: $________________________
2. Exercise of Option. I hereby elect to exercise the Option to purchase
the following number of Shares, all of which are Vested Shares as determined in
accordance with the Option Agreement:
Total Shares Purchased: _________________________
Total Exercise Price
(Total Shares X Price per Share) $________________________
3. Payments. I enclose payment in full of the total exercise price for
the Shares in the following form(s), as authorized by my Option Agreement:
(TM) Cash: $________________________
(TM) Check: $________________________
(TM) Tender of Company Stock: Contact Stock Administrator
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4. Tax Withholding. I authorize payroll withholding and otherwise will
make adequate provision for the federal, state, local and foreign tax
withholding obligations of the Company, if any, in connection with the Option. I
enclose payment in full of my withholding taxes, if any, as follows:
(Contact Stock Administrator for amount of tax due.)
(TM) Cash: $________________________
(TM) Check: $________________________
5. Optionee Information.
My address is: _____________________________________________________
_____________________________________________________
My Social Security Number is: _______________________________________
6. Binding Effect. I agree that the Shares are being acquired in
accordance with and subject to the terms, provisions and conditions of the
Option Agreement, to all of which I hereby expressly assent. This Agreement
shall inure to the benefit of and be binding upon my heirs, executors,
administrators, successors and assigns.
I understand that I am purchasing the Shares pursuant to the terms of the
Option Agreement, a copy of which I have received and carefully read and
understand.
Very truly yours,
-------------------------------
(Signature)
Receipt of the above is hereby acknowledged.
Salon Media Group, Inc.
By:
----------------------------------
Title:
-------------------------------
Dated:
-------------------------------
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