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EXHIBIT 4.4
DATA DIMENSIONS, INC.
NONSTATUTORY STOCK OPTION AGREEMENT
Data Dimensions, Inc., a Delaware corporation (the "Corporation"),
through its Board of Directors, has granted to Xxxxx X. Xxxxx ("Optionee") an
option (the "Option") to purchase 350,000 shares of the Corporation's Common
Stock (the "Option Shares") at a price of $13.25 per share (the "Option Price").
The Option has been granted to Optionee on December 7, 1998 (the "Grant Date").
1. NATURE OF THE OPTION. The Option is a nonstatutory option and is not
intended to qualify as an Incentive Stock Option as defined in Section 422 of
the Internal Revenue Code of 1986, as amended (the "Code").
2. DATE EXERCISABLE; VESTING.
2.1 The Option shall become exercisable as to twenty-five percent
(25%) of the total number of Option Shares at the end of the twelve (12) month
period of Optionee's continuous employment with the Corporation following the
Grant Date. The Option shall thereafter become exercisable as to an additional
twenty-five percent (25%) of the total number of Option Shares at the end of
each subsequent twelve (12) month period of Optionee's continuous employment
with the Corporation. (Each such end date is referred to as a "Vesting Date,"
and each such 25% increment is referred to as an "Installment.") The right to
purchase any Installment or portion thereof shall continue for a period of five
(5) years from the Vesting Date for such Installment. Subject to earlier
termination as provided in Section 4 below, any portion of an Installment not
exercised at the close of business on the fifth (5th) anniversary of the Vesting
Date for such Installment shall thereafter be cancelled and Optionee shall have
no further right to purchase such cancelled Option Shares.
2.2 In the event Optionee for any reason ceases to be an employee of
the Corporation, whether by dismissal, resignation, death, disability or
otherwise, the Option shall be exercisable thereafter only to the extent
Optionee was entitled to exercise it at the date of termination of employment.
2.3 The Option shall become immediately exercisable for the full
number of Option Shares upon the occurrence of an event whereby any person or
entity, including any "person" as such term is used in Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), becomes the
"beneficial owner," as defined in the Exchange Act, of Common Stock representing
fifty percent (50%) or more of the combined voting power of voting securities of
the Corporation.
3. EXERCISE OF OPTION.
3.1 The Option may be exercised in whole or in part by delivery to
the Corporation, from time to time, of written notice, signed by Optionee,
specifying the number of Option Shares that Optionee then desires to purchase,
together with cash or check payable to the order of the Corporation, or other
form of payment acceptable to the Corporation's Board of Directors, for an
amount of United States dollars equal to the Option Price of such Option Shares.
3.2 As soon as practicable after any exercise in whole or in part of
the Option by Optionee, the Corporation shall deliver to Optionee or, at
Optionee's request, Optionee's designated broker, a certificate or certificates
for the number of shares of Common Stock with respect to which the Option was so
exercised, registered in Optionee's name.
4. DURATION OF OPTION. The Option, to the extent not previously
exercised, shall terminate upon the earliest of the following dates:
4.1 The date on which all Installments have been cancelled as
provided in Section 2.1 above;
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4.2 Three (3) months after the date of Optionee's termination of
employment with the Corporation, in the event such termination is for any reason
other than Optionee's disability (as defined in the Employment Agreement between
Optionee and the Corporation) or death;
4.3 One year after Optionee's termination of employment, if such
termination is by reason of Optionee's disability (as defined in the Employment
Agreement between Optionee and the Corporation) or death;
4.4 The date of any sale, transfer or hypothecation, or any attempted
sale, transfer or hypothecation, of such Option in violation of Section 5; or
4.5 Upon the occurrence of any Terminating Event as defined in the
Corporation's 1997 Stock Option Plan, as such Plan may be amended from time to
time (the "1997 Plan").
5. NONTRANSFERABILITY.
5.1 The Option is not transferable by Optionee otherwise than by
testamentary will, the laws of descent and distribution, or qualified domestic
relations order (as defined in the Plan) and, during Optionee's lifetime, may be
exercised only by Optionee or Optionee's guardian or legal representative or the
transferee pursuant to a qualified domestic relations order. No assignment or
transfer of the Option, whether voluntary, involuntary, or by operation of law
or otherwise, except by testamentary will, the laws of descent and distribution,
or qualified domestic relations order, shall vest in the assignee or transferee
any interest or right, but immediately upon any attempt to assign or transfer
the Option, the Option shall terminate and be of no further force or effect.
5.2 Whenever the word "Optionee" is used in any provision of this
Agreement under circumstances when the provision should logically be construed
to apply to the Optionee's guardian, legal representative, executor,
administrator, or the person or persons to whom the Option may be transferred by
testamentary will, the laws of descent and distribution, or qualified domestic
relations order, the word "Optionee" shall be deemed to include such person or
persons.
6. NO RIGHTS AS SHAREHOLDER PRIOR TO EXERCISE. Optionee shall not be
deemed for any purpose to be a shareholder of the Corporation with respect to
any Option Shares as to which the Option has not been exercised.
7. ADJUSTMENTS UPON RECAPITALIZATION OR REORGANIZATION.
7.1 In the event of a material alteration in the capital structure of
the Corporation on account of a recapitalization, stock split, reverse stock
split, stock dividend or otherwise, the Option shall be subject to adjustment by
the Board of Directors on the same basis that options issued pursuant to the
1997 Plan are adjusted as a result of such event.
7.2 In the event of a reorganization, as defined in the 1997 Plan,
the Option shall be assumed or an option substituted therefor on the same basis
that options issued pursuant to the 1997 Plan are assumed or substituted for as
a result of such reorganization.
8. MISCELLANEOUS PROVISIONS.
8.1 TAXATION UPON EXERCISE OF OPTION. Optionee understands that
pursuant to certain provisions of the Code, upon exercise of the Option,
Optionee may recognize income for tax purposes in an amount equal to the excess
of the then fair market value of the Option Shares over the Option Price. The
Corporation may be required to withhold tax from Optionee's current compensation
with respect to such income; to the extent that Optionee's current compensation
is insufficient to satisfy the withholding tax liability, the Company may
require the Optionee to make a cash payment to cover such liability as a
condition of exercise of the Option.
8.2 GOVERNING LAW. This Agreement shall be administered, interpreted
and enforced under the internal laws of the State of Washington, without regard
to conflicts of laws thereof.
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IN WITNESS WHEREOF, the parties have executed this Agreement effective
on the Date of Grant.
OPTIONEE: CORPORATION:
DATA DIMENSIONS, INC.
/s/ Xxxxx X. Xxxxx By: /s/ Xxxxxx X. Xxxxxxxx
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Xxxxx X. Xxxxx Name: XXXXXX X. XXXXXXXX
Title: EVP & CFO
By her signature below, the spouse of the Optionee acknowledges that she
has read this Agreement and Plan and is familiar with the terms and provisions
thereof, and agrees to be bound by all the terms and conditions of said
Agreement and said Plan.
/s/ Xxxxx Xxxxx
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Xxxxx Xxxxx
Dated: 3/9/99
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OPTIONEE: CORPORATION:
DATA DIMENSIONS, INC.
/s/ Xxxxx X. Xxxxx By: /s/ Xxxxxx X. Xxxxxxxx
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Xxxxx X. Xxxxx Name: XXXXXX X. XXXXXXXX
Title: EVP & CFO
By her signature below, the spouse of the Optionee acknowledges that she
has read this Agreement and Plan and is familiar with the terms and provisions
thereof, and agrees to be bound by all the terms and conditions of said
Agreement and said Plan.
/s/ Xxxxx Xxxxx
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Xxxxx Xxxxx
Dated: 3/9/99
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