Exhibit 4.5
RESTRICTED STOCK AGREEMENT
This AGREEMENT is made as of the ____ day of ________ 1999 (the "Grant
Date") by and between America Online, Inc., a Delaware corporation having a
principal place of business in Dulles, Virginia ("AOL" or the "Company"), and
Xxxxx Xxxxxxxx (the "Officer").
W I T N E S S E T H
WHEREAS, the Company has made an offer of employment to the Officer to
be employed by AOL (UK) Limited, a wholly-owned subsidiary of the Company, which
the Officer has accepted pursuant to the terms of an employment agreement dated
___________, 1999 (the "Employment Agreement"), and the Company desires to offer
and grant to the Officer shares of Company common stock, par value $.01 per
share (the "Common Stock"), in accordance with the terms and conditions
hereinafter set forth;
NOW, THEREFORE, in consideration of the promises and the mutual
covenants contained herein and for other good and valuable consideration, the
parties hereby agree as follows:
1. Terms of Purchase. The Officer hereby accepts the offer of the
Company to issue to the Officer, in accordance with the terms of this Agreement,
ten thousand (10,000) shares of the Company's Common Stock (such shares, subject
to adjustment pursuant to Subsections 2(i) and (j) hereof, the "Shares") at a
purchase price per share of one cent ($.01) (the "Purchase Price"), receipt of
which is hereby acknowledged by the Company.
2. Company's Lapsing Repurchase Right.
(a) Lapsing Repurchase Right. Except as set forth in Subsections 2(b),
2(c) and 2(d), in the event for any reason, whether with or without notice and
whether or not the Company or the Affiliate of the Company has acted lawfully in
terminating the employment, the Officer ceases to be an employee of the Company
or an Affiliate of the Company prior to the third anniversary of the Grant Date,
the Company or its designee shall have the option, but not the obligation, to
purchase from the Officer (or her successor in interest), and the Officer (or
her successor in interest) shall be obligated to sell to the Company or its
designee, at a price per Share equal to the Purchase Price, all or any part of
the Shares set forth in clauses (i), (ii) and (iii) below (the "Lapsing
Repurchase Right"). The Company's Lapsing Repurchase Right shall be valid for a
period of six (6) months commencing with the date of such termination.
Notwithstanding any other provision hereof, in the event the Company is
prohibited during such six (6) months from exercising its Lapsing Repurchase
Right by Section 160 of the Delaware General Corporation Law as amended from
time to time (or any successor provision), then the time period such Lapsing
Repurchase Right may be exercised shall be extended until twenty (20) days after
the Company is first not so prohibited.
(i) If such termination of employment is prior to the first
anniversary of the Grant Date, the Company shall have the option to
repurchase all of the Shares acquired by the Officer hereunder.
(ii) If such termination of employment is on or after the
first anniversary of the Grant Date and prior to the second anniversary
of the Grant Date, the Company shall have the option to repurchase
6,667 of the Shares; if such termination of employment is on or after
the second anniversary of the Grant Date and prior to the third
anniversary of the Grant Date, the Company shall have the option to
repurchase 3,334 of the Shares, as provided in this Agreement.
(iii) Notwithstanding anything to the contrary contained in
this Agreement, except as otherwise provided in Subsection 2(b) below,
in the event the Company or the Affiliate of the Company terminates the
Officer's employment for Cause (as defined below) or in the event the
Company determines, subsequent to the Officer's termination of service
but during the ninety (90) days after the termination of service (or if
the Officer shall die during such period, during the one year period
following such termination of service) that either prior or subsequent
to the Officer's termination the Officer engaged in conduct that would
constitute Cause, the Company shall have the option to repurchase all
of the Shares acquired by the Officer hereunder.
(b) Effect of Termination for Disability or upon Death. Notwithstanding
the provisions of clauses (i), (ii) and (iii) immediately above, if such
termination of employment is as a result of the Officer's Disability or death,
then the Company's Lapsing Repurchase Right shall terminate, and the Officer's
(or the Officer's Survivors') ownership of all Shares then owned by her shall
become vested.
(c) Effect of Termination without Cause. The Company's Lapsing
Repurchase Right shall terminate, and the Officer's ownership of all Shares then
owned by her shall become vested, if the Company of the Affiliate of the Company
terminates the Officer's employment other than for Cause.
(d) Effect of Change in Control. The Company's Lapsing Repurchase Right
shall terminate, and the Officer's ownership of all Shares then owned by her
shall become vested, in the event of a Change in Control upon the first to occur
of (x) the date the Lapsing Repurchase Right otherwise expires under the terms
of this Agreement, (y) the first anniversary of the date such Corporate Change
in Control is determined to have occurred, and (z) the occurrence of an
Involuntary Employment Action.
(e) Closing. In the event that the Company exercises the Lapsing
Repurchase Right, the Company shall notify the Officer, or, in the case of her
death, her representative, in writing of its intent to repurchase the Shares.
Such notice may be mailed by the Company up to and including the last day of the
time period provided for above for exercise of the Lapsing Repurchase Right. The
notice shall specify the place, time and date for payment of the repurchase
price (the "Closing"). The date specified shall be not less than ten (10) days
nor more than sixty (60) days from the date of mailing of the notice, and the
Officer or her successor in interest with respect to the Shares which the
Company elects to repurchase shall have no further rights as the owner thereof
from and after the date specified in the notice. At the Closing, the repurchase
price shall be delivered to the Officer or her successor in interest and the
Shares being purchased, duly endorsed for transfer, shall, to the extent that
they are not in the possession of the Company, be delivered to the Company by
the Officer or her successor in interest.
(f) Escrow. The certificates representing all Shares acquired by the
Officer hereunder which from time to time are subject to the Lapsing Repurchase
Right shall be delivered to the Company and the Company shall hold such Shares
in escrow as provided in this Subsection 2(f). Promptly following a request from
the Officer, the Company shall release from escrow and deliver to the Officer a
certificate for the number of Shares, if any, as to which the Lapsing Repurchase
Right has lapsed. In the event of a repurchase by the Company of Shares subject
to the Lapsing Repurchase Right, the Company shall release from escrow and
cancel a certificate for the number of Shares so repurchased. Any securities
distributed in respect of the Shares held in escrow, including, without
limitation, shares issued as a result of stock splits, stock dividends or other
recapitalizations, shall also be held in escrow in the same manner as the
Shares.
(g) Prohibition on Transfer. The Officer recognizes and agrees that all
Shares which are subject to the Lapsing Repurchase Right may not be sold,
transferred, assigned, hypothecated, pledged, encumbered or otherwise disposed
of, whether voluntarily or by operation of law (other than to the Company or its
designee). The Company shall not be required to transfer any Shares on its books
which shall have been sold, assigned or otherwise transferred in violation of
this Subsection 2(g), or to treat as the owner of such Shares, or to accord the
right to vote as such owner or to pay dividends to, any person or organization
to which any such Shares shall have been so sold, assigned or otherwise
transferred, in violation of this Subsection 2(g).
(h) In the event that the Officer or her successor in interest fails to
deliver the Shares to be repurchased by the Company under this Agreement, the
Company may elect (i) to establish a segregated account in the amount of the
repurchase price, such account to be turned over to the Officer or her successor
in interest upon delivery of such Shares, and (ii) immediately to take such
action as is appropriate to transfer record title of such Shares from the
Officer to the Company and to treat the Officer and such Shares in all respects
as if delivery of such Shares had been made as required by this Agreement. The
Officer hereby irrevocably grants the Company a power of attorney which shall be
coupled with an interest for the purpose of effectuating the preceding sentence.
The Officer agrees as a condition to the performance by the Company of this
Agreement to execute and deliver the Stock Power attached hereto as Exhibit A.
(i) If the Company shall pay a stock dividend or declare a stock split
on or with respect to any of its Common Stock, or otherwise distribute
securities of the Company to the holders of its Common Stock, the number of
shares of stock or other securities of the Company issued with respect to the
Shares then subject to the restrictions contained in this Agreement shall be
added to the Shares subject to the Company's rights of repurchase pursuant to
this Agreement. If the Company shall distribute to its stockholders securities
of another corporation, the securities of such other corporation, distributed
with respect to the Shares then subject to the restrictions contained in this
Agreement, shall be added to the Shares subject to the Company's rights to
repurchase pursuant to this Agreement.
(j) If the outstanding shares of the Company's Common Stock shall be
subdivided into a greater number of shares or combined into a smaller number of
shares, or in the event of a reclassification of the outstanding shares of the
Company's Common Stock, or if the Company shall be a party to a merger,
consolidation or capital reorganization, there shall be substituted for the
Shares then subject to the restrictions contained in this Agreement such amount
and kind of securities as are issued in such subdivision, combination,
reclassification, merger, consolidation or capital reorganization in respect of
the Shares subject immediately prior thereto to the Company's rights of
repurchase pursuant to this Agreement.
3. Legend. All certificates representing the Shares to be issued to the
Officer pursuant to this Agreement shall have endorsed thereon a legend
substantially as follows:
"The shares represented by this certificate are subject to
restrictions set forth in a Restricted Stock Agreement dated
__________, 1999 with America Online, Inc., a copy of which
Agreement is available for inspection at the offices of the
Company or will be made available upon request."
4. Defined Terms. Capitalized terms not otherwise defined herein shall
have the following meanings:
"Affiliate of the Company" means any corporation, company or
other entity such that the Company directly or indirectly, through one or more
intermediaries, owns or controls the greater of (i) 25% of the voting power or
outstanding securities of such corporation, company or other entity; or (ii)
such amount of voting or outstanding securities or has other controlling
interest such that the Shares would qualify for registration on Form S-8, all as
determined by the Company.
"Board of Directors" means the Board of Directors of
the Company.
"Cause" shall mean (a) the Officer's conviction of a felony
involving moral turpitude, (b) her willful and continued failure
substantially to perform her required duties under the Employment
Agreement, (c) her intentional or repeated violation of the
Confidentiality, Non-Competition, and Proprietary Rights Agreement, or
(d) her intentional or improper conduct substantially prejudicial to
the business of the Company or any of its affiliates.
"Change in Control" means a Corporate Change in Control or a
Transactional Change in Control of the Company.
"Code" means the United States Internal Revenue Code of 1986,
as amended.
"Corporate Change in Control" means the happening of any of
the following events:
(1) the acquisition by any individual, entity or group (an
"Entity"), including any "person" within the meaning of Section
13(d)(3) or 14(d)(2) of the Exchange Act, of beneficial ownership
(within the meaning of Rule 13d-3 promulgated under the Exchange
Act) of 30% or more of either (i) the then outstanding shares of
common stock of the Company (the "Outstanding Company Common
Stock") or (ii) the combined voting power of the then outstanding
securities of the Company entitled to vote generally in the
election of directors (the "Outstanding Company Voting
Securities"); excluding, however, the following: (A) any
acquisition directly from the Company (excluding any acquisition
by virtue of the exercise of an exercise, conversion or exchange
privilege unless the security being so exercised, converted or
exchanged was itself acquired directly from the Company), (B) any
acquisition by the Company, or (C) any acquisition by an employee
benefit plan (or related trust) sponsored or maintained by the
Company or by any corporation controlled by the Company; or
(2) a change in the composition of the Board since the Grant Date,
such that the individuals who, as of such date, constituted the
Board of Directors (the "Incumbent Board") cease for any reason to
constitute at least a majority of such Board; provided that any
individual who becomes a director of the Company subsequent to the
Grant Date whose election, or nomination for election by the
Company's stockholders, was approved by the vote of at least a
majority of the directors then comprising the Incumbent Board
shall be deemed a member of the Incumbent Board; and provided
further, that any individual who was initially elected as a
director of the Company as a result of an actual or threatened
election contest, as such terms are used in Rule 14a-11 of
Regulation 14A promulgated under the Exchange Act, or any other
actual or threatened solicitation of proxies or consents by or on
behalf of any person or Entity other than the Board shall not be
deemed a member of the Incumbent Board.
"Disability" or "Disabled" means permanent and total
disability as defined in Section 22(e)(3) of the Code.
"Involuntary Employment Action" shall mean any change in the
terms and conditions of the Officer's employment with the Company or
any successor, without Cause, to such extent that:
(1) the Officer shall fail to be vested with power,
authority and resources analogous to the Officer's title
and/or office prior to the Change in Control, or
(2) the Officer shall lose any significant duties or
responsibilities attending such office, or
(3) there shall occur a reduction in the Officer's base
compensation, or
(4) the Officer's employment with the Company, or its
successor, is terminated without Cause.
"Survivors" means a deceased Officer's legal representatives
and/or any person or persons who acquired the Officer's rights to a
Stock Grant by will or by the laws of descent and distribution.
"Transactional Change in Control" shall mean any of the
following transactions to which the Company is a party:
(1) a reorganization, recapitalization, merger or consolidation (a
"Corporate Transaction") of the Company, unless securities
representing 60% or more of either the outstanding shares of
common stock or the combined voting power of the then outstanding
voting securities entitled to vote generally in the election of
directors of the Company or the corporation resulting from such
Corporate Transaction (or the parent of such corporation) are held
subsequent to such transaction by the person or persons who were
the beneficial holders of the Outstanding Company Common Stock and
Outstanding Company Voting Securities immediately prior to such
Corporate Transaction, in substantially the same proportions as
their ownership immediately prior to such Corporate Transaction;
or
(2) the sale, transfer or other disposition of all or
substantially all of the assets of the Company.
5. Tax Liability of the Officer and Payment of Taxes. The Officer
acknowledges and agrees that any income or other taxes due from her with respect
to the Shares issued pursuant to this Agreement, including, without limitation,
the lapsing of the Company's right of repurchase, shall be the Officer's
responsibility. Without limiting the foregoing, the Officer agrees that, to the
extent that the lapsing of restrictions on disposition of any of the Shares or
the declaration of dividends on any such shares before the lapse of such
restrictions on disposition results in the Officer's being deemed to be in
receipt of earned income under the provisions of the Code, the Company shall be
entitled to immediate payment from the Officer of the amount of any tax required
to be withheld by the Company.
6. Securities Law Compliance. The Officer represents that any sales of
Shares at a time when the Officer may be deemed an "affiliate" of the Company
for purposes of the Securities Act of 1933, as amended (the "Act"), shall be
made in accordance with the requirements of Rule 144 under the Act (or any
successor rule) applicable to sales by an "affiliate" of shares registered under
the Act or in a transaction otherwise exempt from the registration requirements
of the Act and as to which the Company shall have received an opinion of counsel
satisfactory to it confirming such exemption.
7. Equitable Relief and Consent to Jurisdiction. The Officer
specifically acknowledges and agrees that in the event of a breach or threatened
breach of the provisions of this Agreement, including the attempted transfer of
the Shares by the Officer, monetary damages may not be adequate to compensate
the Company, and, therefore, in the event of such a breach or threatened breach,
in addition to any right to damages, the Company shall be entitled to equitable
relief in any court having competent jurisdiction. Nothing herein shall be
construed as prohibiting the Company from pursuing any other remedies available
to it for any such breach or threatened breach.
The Officer specifically consents to the jurisdiction of the courts of
the Commonwealth of Virginia in any action, whether at law or in equity, brought
by the Company to protect any of its rights hereunder.
8. No Obligation to Employ. The Company is not by this Agreement
obligated to continue the Officer as an employee of the Company or of any
Affiliate of the Company.
9. Notices. Any notices required or permitted by the terms of this
Agreement shall be given by recognized courier service, registered or certified
mail, return receipt requested, postage prepaid, or facsimile, addressed as
follows:
If to the Company:
America Online, Inc.
00000 XXX Xxx
Xxxxxx, Xxxxxxxx 00000
Attention: General Counsel
If to the Officer:
to the Officer's last address as set forth in the records of the
Company,
or to such other address(es) of which notice in the same manner has previously
been given. Any such notice shall be deemed to have been given on the earliest
of receipt, one (1) business day following delivery by the sender to a
recognized courier service, or three (3) business days following mailing by
registered or certified mail.
10. Binding Effect. This Agreement shall be for the benefit of and
shall be binding upon the parties hereto, upon their respective successors and
assigns and upon the Officer's heirs, executors and administrators.
11. Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of Delaware without giving effect to the
conflict of law principles thereof.
12. Severability. If any provision of this Agreement is held to be
invalid or unenforceable by a court of competent jurisdiction, then such
provision or provisions shall be modified to the extent necessary to make such
provision valid and enforceable, and to the extent that this is impossible, then
such provision shall be deemed to be excised from this Agreement, and the
validity, legality and enforceability of the rest of this Agreement shall not be
affected thereby.
13. Entire Agreement. This Agreement constitutes the entire agreement
and understanding between the parties hereto with respect to the subject matter
hereof and supersedes all prior oral or written agreements and understandings
relating to the subject matter hereof. No statement, representation, warranty,
covenant or agreement not expressly set forth in this Agreement shall affect or
be used to interpret, change or restrict the express terms and provisions of
this Agreement.
14. Modifications and Amendments; Waivers and Consents. The terms and
provisions of this Agreement may not be modified, amended, renewed, or
terminated, nor may any term, condition or breach of any term or condition be
waived, except by a writing signed by the person or persons sought to be bound
by such modification, amendment, renewal, termination or waiver. Any waiver of
any term, condition or breach hereof shall not be a waiver of any other term or
condition or of the same term or condition for the future, or of any subsequent
breach.
15. Consent of Spouse. If the Officer is married as of the date of this
Agreement, the Officer's spouse shall execute a Consent of Spouse in the form of
Exhibit B hereto, effective as of the date hereof. Such consent shall not be
deemed to confer or convey to the spouse any rights in the Shares that do not
otherwise exist by operation of law or the agreement of the parties. If the
Officer marries or remarries subsequent to the date hereof, the Officer shall,
not later than sixty (60) days thereafter, obtain her new spouse's
acknowledgement of and consent to the existence and binding effect of all
restrictions contained in this Agreement by such spouse's executing and
delivering a Consent of Spouse in the form of Exhibit B.
16. Counterparts. This Agreement may be executed in one or more
counterparts, and by different parties hereto on separate counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
AMERICA ONLINE, INC.
By:
Printed Name:
Title:
OFFICER:
Xxxxx Xxxxxxxx
EXHIBIT A
STOCK POWER
For value received, I hereby sell, assign, and transfer to America
Online, Inc. ______________ shares of Common Stock of America Online, Inc.,
standing in the undersigned's name on the books and records of the aforesaid
Company, represented by Certificate No(s). ___________________________, and do
hereby irrevocably constitute and appoint the Corporate Secretary of America
Online, Inc. attorney, with full power of substitution, to transfer this stock
on the books and records of the aforesaid Company.
-----------------------------
Xxxxx Xxxxxxxx
Dated As Of:
______________, 1999
In the presence of:
Printed Name:
EXHIBIT B
CONSENT OF SPOUSE
I, , spouse of Xxxxx Xxxxxxxx, acknowledge that I have read the
RESTRICTED STOCK AGREEMENT dated as of ___________________, 1999 (the
"Agreement") to which this Consent is attached as Exhibit B and that I know its
contents. Capitalized terms used and not defined herein shall have the meanings
assigned to such terms in the Agreement. I am aware that by its provisions the
Shares granted to my spouse pursuant to the Agreement are subject to a Lapsing
Repurchase Right in favor of America Online, Inc. (the "Company") and that,
accordingly, the Company has the right to repurchase up to all of the Shares of
which I may become possessed as a result of a gift from my spouse, operation of
law or a court decree and/or any property settlement in any domestic litigation.
I hereby agree that my interest, if any, in the Shares subject to the
Agreement shall be irrevocably bound by the Agreement and further understand and
agree that any community property interest I may have in the Shares shall be
similarly bound by the Agreement.
I agree to the Lapsing Repurchase Right described in the Agreement and
I hereby consent to the repurchase of the Shares by the Company and the sale of
the Shares by my spouse or her legal representative in accordance with the
provisions of the Agreement. Further, as part of the consideration for the
Agreement, I agree that at my death, if I have not disposed of any interest of
mine in the Shares by an outright bequest of the Shares to my spouse, then the
Company shall have the same rights against my legal representative to exercise
its rights of repurchase with respect to any interest of mine in the Shares as
it would have had pursuant to the Agreement if I had acquired the Shares
pursuant to a court decree in domestic litigation.
I AM AWARE THAT THE LEGAL, FINANCIAL AND RELATED MATTERS CONTAINED IN
THE AGREEMENT ARE COMPLEX AND THAT I AM FREE TO SEEK INDEPENDENT PROFESSIONAL
GUIDANCE OR COUNSEL WITH RESPECT TO THIS CONSENT. I HAVE EITHER SOUGHT SUCH
GUIDANCE OR COUNSEL OR DETERMINED AFTER REVIEWING THE AGREEMENT CAREFULLY THAT I
WILL WAIVE SUCH RIGHT.
Dated as of the day of 1999.
Printed name:
