EXHIBIT 4.1
ZIXIT CORPORATION
STOCK OPTION AGREEMENT
Date of Grant Expiration Date
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THIS STOCK OPTION AGREEMENT ("Agreement") is made and entered into as
of the ____ day of _________________ by and between ZixIt Corporation, a Texas
corporation (the "Company"), and _____________ ("Optionee").
WHEREAS, the Company wishes to recognize the contributions of the
Optionee to the Company and to encourage the Optionee's sense of proprietorship
in the Company by owning the Common Stock, par value $.01 per share (the "Common
Stock"), of the Company;
NOW, THEREFORE, in consideration of the mutual agreements and covenants
contained herein, the Company hereby grants to the Optionee a non-qualified
stock option to purchase up to a total of _____________ shares of the Common
Stock at a price per share of $____ (the "Option Price") on the terms and
conditions set forth herein.
1. DEFINITIONS.
a. Acquiring Person. An "Acquiring Person" shall mean any person
(including any "person" as such term is used in Sections 13 (d) (3) or 14 (d)
(2) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"))
that, together with all Affiliates and Associates of such person, is the
beneficial owner of 35% or more of the outstanding Common Stock. The term
"Acquiring Person" shall not include the Company, any subsidiary of the Company,
any employee benefit plan of the Company or subsidiary of the Company, or any
person to the extent such person is holding Common Stock for or pursuant to the
terms of any such plan. For the purposes of this Agreement, a person who becomes
an Acquiring Person by acquiring beneficial ownership of 35% or more of the
Common Stock at any time after the date of this Agreement shall continue to be
an Acquiring Person whether or not such person continues to be the beneficial
owner of 35% or more of the outstanding Common Stock.
b. Affiliate and Associate. "Affiliate" and "Associate" shall have the
respective meanings ascribed to such terms in Rule 12b-2 of the General Rules
and Regulations under the Exchange Act in effect on the date of this Agreement.
c. Change in Control. A "Change in Control" of the Company shall have
occurred if at any time during the term of this Agreement any of the following
events shall occur:
(i) (a) Any Sale of the Company or (b) any Sale of a Material
Subsidiary; or
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(ii) Any Acquiring Person has become the beneficial owner of
securities which, when added to any securities already owned by such
person, would represent in the aggregate 35% or more of the
then-outstanding securities of the Company that are entitled to vote to
elect any class of directors;
(iii) If at any time, the Continuing Directors then serving on
the Board of Directors of the Company cease for any reason to
constitute at least a majority thereof; or
(iv) Any occurrence that would be required to be reported in
response to Item 6(e) of Schedule 14A of Regulation 14A or any
successor rule or regulation promulgated under the Exchange Act.
d. Continuing Director. A "Continuing Director" shall mean a director
of the Company who (i) is not an Acquiring Person or an Affiliate or Associate
thereof, or a representative of an Acquiring Person or nominated for election by
an Acquiring Person, and (ii) was either a member of the Board of Directors of
the Company on the date of this Agreement or subsequently became a director of
the Company and whose initial election or initial nomination for election by the
Company's shareholders was approved by a majority of the Continuing Directors
then on the Board of Directors of the Company.
e. Disability. "Disability" shall mean any medically determinable
physical or mental impairment that, in the opinion of the Committee, based upon
medical reports and other evidence satisfactory to the Committee, can reasonably
be expected to prevent the Optionee from performing substantially all of his or
her customary duties of employment (with or without reasonable accommodation)
for a continuous period of not less than 12 months.
f. Material Subsidiary. A "Material Subsidiary" shall mean XxxXxxx.xxx,
Inc., a Delaware corporation.
g. Person. A "Person" shall mean an individual, a corporation, a
partnership, an association, a joint-stock company, a trust, an incorporated
organization, or a government or political subdivision thereof and any other
entity. A Person, together with that Person's Affiliates and Associates, and any
Persons acting as a partnership, limited partnership, joint venture,
association, syndicate, or other group (whether or not formally organized), or
otherwise acting jointly or in concert or in a coordinated or consciously
parallel manner (whether or not pursuant to any express agreement), for the
purpose of acquiring, holding, voting, or disposing of securities of the Company
with that Person, shall be deemed a single "Person."
h. Resignation. "Resignation" shall mean the voluntary termination by
the Optionee of his or her employment relationship with the employing Subsidiary
and, if applicable, Company under circumstances other than voluntary Retirement.
i. Retirement. "Retirement" shall mean the termination of Optionee's
employment in accordance with the requirements of a written retirement plan,
policy or rule of the Company that has been duly adopted by the Company or
employing Subsidiary, as applicable.
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j. Sale. A "Sale" occurs with respect to the Company or a Material
Subsidiary, as applicable, if it engages in a merger, consolidation, or sale,
lease, license, transfer, or other effective disposition of all or substantially
all of the Company's or Material Subsidiary's assets and the Company or its
shareholders or Affiliates immediately before such transaction beneficially own,
immediately after or as a result of such transaction, equity securities of the
surviving or acquiring corporation or such corporation's parent corporation
possessing less than fifty one percent (51%) of the voting power of the
surviving or acquiring Person or such Person's parent corporation, provided that
a Sale shall not be deemed to occur upon any public offering or series of such
offerings of securities of the Company or a Material Subsidiary that results in
any such change in beneficial ownership.
2. TERM OF OPTION. The term of this option shall expire on the date set forth in
the upper right hand corner on page 1 of this Agreement (the "stated term"),
except as such term may be otherwise shortened by the other provisions of the
Plan or this Agreement.
3. EXERCISE OF OPTION.
a. Exercise. This option shall become exercisable in increments as
follows:
Date Upon Which Right
Number of Shares To Purchase Accrues
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Except as provided in the Agreement, the Option shall not be
exercisable unless Optionee shall, at the time of exercise, be an Employee or
Director of the Company or a Subsidiary, and once the Option has become
exercisable with respect to a certain number of shares as provided above, it
shall thereafter be exercisable as to all of that number of shares, or as to any
part thereof, until expiration or termination of this option. However, this
option may not be exercised as to less than 100 shares at any one time (or the
remaining shares then purchasable under this option, if less than 100 shares).
b. Adjustment. In the event there is any adjustment to the Common Stock
subject to Section 5(b) of the Plan, the Board of Directors or Committee shall
make such adjustment as it deems appropriate to the number of shares subject to
Award or to the Option Price, or both.
c. Exercise - Change of Control. If the Optionee is still an employee
or director of the Company or a Subsidiary on the date of the occurrence of a
Change of Control, this option shall become exercisable in full on such date and
may be exercised at any time or times thereafter and until expiration or
termination of this option; provided, however, that this option may not be
exercised as to less than 100 shares at any one time (or the remaining shares
then purchasable under this option, if less than 100 shares).
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d. Method of Exercise. This option may be exercised only by written
notice (the "Exercise Notice") by the Optionee to the Company at its principal
executive office. The Exercise Notice shall be deemed given when deposited in
the U. S. mails, postage prepaid, addressed to the Company at its principal
executive office, or if given other than by deposit in the U.S. mails, when
delivered in person to an officer of the Company at that office. The date of
exercise of this option (the "Exercise Date") shall be the date of the postmark
if the notice is mailed or the date received if the notice is delivered other
than by mail. The Exercise Notice shall state the number of shares in respect of
which this option is being exercised and, if the shares for which this option is
being exercised are to be evidenced by more than one stock certificate, the
denominations in which the stock certificates are to be issued. The Exercise
Notice shall be signed by the Optionee and shall include the complete address of
such person, together with such person's social security number.
This option may be exercised either by tendering cash in the amount of
the Option Price or, with the Company's consent, subject to compliance with
applicable requirements of Section 16(b) under the Exchange Act, by tendering
shares of Common Stock (which may include shares previously acquired upon
exercise of options granted under the Plan). The Exercise Notice shall be
accompanied by payment of the aggregate Option Price of the shares purchased by
cash, a certified cashier's check or, at the Company's option, by delivery of
shares of Common Stock having a Fair Market Value on the date immediately
preceding the exercise date equal to the Option Price.
If the shares to be purchased are covered by an effective registration
statement under the Securities Act of 1933, as amended, any option granted under
the Plan may be exercised by a broker-dealer acting on behalf of an Optionee if
(a) the broker-dealer has received from the Optionee or the Company a fully- and
duly-endorsed agreement evidencing such option, together with instructions
signed by the Optionee requesting the Company to deliver the shares of Common
Stock subject to such option to the broker-dealer on behalf of the Optionee and
specifying the account into which such shares should be deposited, (b) adequate
provision has been made with respect to the payment of any withholding taxes due
upon such exercise, and (c) the broker-dealer and the Optionee have otherwise
complied with Section 220.3(e)(4) of Regulation T, 12 CFR Part 220, or any
successor provision.
The certificates for shares of Common Stock as to which this option
shall have been so exercised shall be registered in the name of the Optionee and
shall be delivered to the Optionee at the address specified in the Exercise
Notice. An option exercise shall be valid only if the Optionee makes payment or
other arrangements relating to the withholding tax obligations discussed in
Paragraph 8. In the event the person exercising this option is a transferee of
the Optionee by will or under the laws of descent and distribution, the Exercise
Notice shall be accompanied by appropriate proof of the right of such transferee
to exercise this Option.
4. TERMINATION OF OPTION.
In the event an Optionee ceases to be an employee or director of either
the Company or a Subsidiary of the Company due to death, Retirement,
Resignation, Disability or termination by
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the Company for any reason other than "cause" (such five events each being a
"Qualified Termination"), this option may be exercised by the Optionee or his or
her estate, personal representative or beneficiary to the fullest extent that
the Optionee was entitled to exercise the same on the day immediately prior to
such termination at any time within the one-year period commencing on the day
next following such termination or, if shorter, only for the remaining stated
term of this option. In the event that the Optionee's employment is terminated
for any reason other than a Qualified Termination, this option shall
automatically expire simultaneously with such termination. For purposes of this
Paragraph, "cause" shall mean (i) the failure, in the sole opinion of the
Company or a Subsidiary of the Company that employs Optionee, of Optionee to
adequately perform the duties assigned to Optionee (other than any such failure
resulting from Optionee's Disability); (ii) the engagement by Optionee in
misconduct that, in the sole opinion of the Company or a Subsidiary of the
Company that employs Optionee, is or may have the effect of being materially
injurious to the Company or its Subsidiaries; or (iii) the conviction of
Optionee of any felony or crime of moral turpitude.
After the Optionee's death, this option shall be exercisable only by
the executor or administrator of the Optionee's estate, or if the Optionee's
estate is not in administration, by the person or persons to whom the Optionee's
rights shall have passed by the Optionee's will or under the laws of descent and
distribution of the state where the Optionee was domiciled at the date of death.
5. NO RIGHTS AS SHAREHOLDER. Neither the Optionee nor any person claiming under
or through the Optionee shall be or have any rights or privileges of a
shareholder of the Company in respect of any of the shares issuable upon the
exercise of this option, unless and until certificates representing such shares
shall have been issued (as evidenced by the appropriate entry on the books of
the Company or of a duly authorized transfer agent of the Company).
6. STATE AND FEDERAL SECURITIES REGULATION. No shares shall be issued by the
Company upon the exercise of this option unless and until any then-applicable
requirements of state and federal laws and regulatory agencies shall have been
fully complied with to the satisfaction of the Company and its counsel. The
Company may suspend for a reasonable period or periods the time during which
this option may be exercised if, in the opinion of the Company, such suspension
is required to enable the Company to remain in compliance with regulatory
requirements relating to the issuance of shares of Common Stock subject to this
option. This option is subject to the requirement that, if at any time the
Company shall determine, in its discretion, that the listing, registration or
qualification of the shares of common stock subject to this option upon any
securities exchange or under any state or federal law, or the consent or
approval of any government regulatory body, is necessary or desirable as a
condition of, or in connection with, the granting or exercise of this option or
the issue or purchase of shares under this option, this option may not be
exercised in whole or in part until such listing, registration, qualification,
consent or approval shall have been effected or obtained free of any conditions
not acceptable to the Company. The Company shall be under no obligation to
effect or obtain any such listing, registration, qualification, consent or
approval if the Company shall determine, in its discretion, that such action
would not be in the best interest of the Company. The Company shall not be
liable for damages due to a delay in the delivery or issuance of any stock
certificates for
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any reason whatsoever, including, but not limited to, a delay caused by listing,
registration or qualification of the shares of Common Stock subject to an option
upon any securities exchange or under any federal or state law or the effecting
or obtaining of any consent or approval of any governmental body with respect to
the granting or exercise of this option or the issue or purchase of shares under
this option.
7. MODIFICATION OF OPTIONS. At any time and from time to time the Committee may
execute an instrument providing for modification, extension, or renewal of any
outstanding option, provided that no such modification, extension or renewal
shall (i) impair this option in any respect without the written consent of the
holder of this option or (ii) conflict with the provisions of Rule 16b-3 under
the Exchange Act.
8. WITHHOLDING OF TAXES. The Company may make such provisions and take such
steps as it may deem necessary or appropriate for the withholding of any taxes
which the Company or any Subsidiary is required by any law or regulation of any
governmental authority, whether federal, state or local, domestic or foreign, to
withhold in connection with any option, including, but not limited to, the
withholding of the issuance of all or any portion of the shares of Common Stock
subject to this option until the Optionee reimburses the Company or the
applicable Subsidiary for the amount the Company or the applicable Subsidiary is
required to withhold with respect to such taxes, subject to compliance with
applicable requirements of Section 16(b) under the Exchange Act, canceling any
portion of the issuance in an amount sufficient to reimburse the Company or the
applicable Subsidiary for the amount it is required to so withhold, or taking
any other action reasonably required to satisfy the withholding obligation of
the Company or the applicable Subsidiary.
9. CONTINUED EMPLOYMENT NOT PRESUMED. Nothing in this Agreement, the Plan or any
document describing it nor the grant of an option shall give the Optionee the
right to continue in employment with the Company or any of its Subsidiaries or
affect the right of the Company or a Subsidiary to terminate the employment of
the Optionee with or without cause.
10. NON-COMPETITION COVENANTS.
a. The provisions of this subparagraph a. shall apply both during
normal working hours and at all other times including, but not limited to,
nights, weekends and vacation time, while Optionee is employed by the Company or
any Subsidiary. Optionee shall not directly or indirectly (i) engage in any
employment, business, or activity that is competitive with the business of the
Company or any Subsidiary, (ii) assist any other person or organization in
competing with, or in preparing to engage in competition with, the business of
the Company or any Subsidiary. Direct competition shall include, but not be
limited to, the design, development, production, promotion or sale of products,
software, or services competitive with those of the Company or any Subsidiary.
In addition, Optionee shall not directly or indirectly (i) engage in any
employment, business, or activity that is competitive with either (A) the
proposed business of the Subsidiary that employs Optionee ("Employing
Subsidiary") or (B) any proposed business of any of the Company's other
Subsidiaries (the "Non-Employing Subsidiaries") of which Optionee has actual
knowledge, or (ii) assist any other person or organization in competing with, or
in
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preparing to engage in competition with, either (A) the proposed business of the
Employing Subsidiary or (B) any proposed business of any Non-Employing
Subsidiary of which Optionee has actual knowledge.
b. The provisions of this subparagraph b. shall apply during Optionee's
employment with the Company or any Subsidiary and for a period of six months
after Optionee ceases to be employed by the Company or any Subsidiary. Optionee
shall not directly or indirectly solicit to conduct any Competitive Business
with, or conduct any Competitive Business with, any (i) then-current customer of
the Employing Subsidiary or (ii) any person that has been a customer of the
Employing Subsidiary within the six months prior to the time of Optionee's
separation from employment. The phrase "Competitive Business" means the line(s)
of business(es) conducted by the Employing Subsidiary.
c. The provisions of this subparagraph c. shall apply during Optionee's
employment with the Company or any Subsidiary and for a period of 12 months
after Optionee's separation from employment. Optionee shall not directly or
indirectly solicit to hire, or cause to be hired, any employee of the Company or
any Subsidiary as an employee or agent of, or consultant to, any business
enterprise that Optionee is associated with.
d. Each non-competition covenant of Optionee contained in the preceding
provisions of this Paragraph 10 (the "non-competition covenant") shall be
construed as an agreement independent of any other provision of this Agreement
and the existence of any claim or cause of action of Optionee against the
Company or any Subsidiary, whether predicated on this Agreement or otherwise,
shall not constitute a defense to the enforcement by the Company or any
Subsidiary of such non-competition covenant.
e. The Company and Optionee have in good faith used their best efforts
to make each non-competition covenant contained in the preceding provisions of
this Paragraph 10 reasonable in both scope and in duration. It is not
anticipated, nor is it intended, by either party to this Agreement that any
court or other tribunal having jurisdiction over the matter will find it
necessary to reform any non-competition covenant to make it reasonable in both
scope and in duration, or otherwise. If any non-competition covenant is deemed
by a tribunal having jurisdiction over the matter to be unlawful or
unenforceable, such provision will be deemed severable from this Agreement and
such provision will be limited or eliminated to the minimum extent necessary so
that the remaining provisions of this Agreement shall otherwise remain in full
force and effect and be enforceable. Furthermore, in lieu of such unlawful or
unenforceable provision, there shall be added automatically as part of this
Agreement a provision as similar in terms as may be possible and be enforceable.
f. Optionee is agreeing to the provisions of this Paragraph 10 in
consideration of the grant of this option. The provisions of this Paragraph 10
shall be valid and enforceable by the Company and its Subsidiaries, regardless
of whether or not any of this option granted hereunder actually becomes
exercisable, or whether or not Optionee actually exercises any rights under this
option. In the event of any conflict or inconsistency between any provision of
this Paragraph 10 and any similar or analogous provision of any other agreement
(either currently in effect or that
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may be entered into in the future) between Optionee, on the one hand, and the
Company or any Subsidiary, on the other hand, whichever provision is most
favorable to the Company or such Subsidiary shall govern.
11. APPLICABILITY OF 1995 LONG-TERM INCENTIVE PLAN. The relevant provisions of
the
ZixIt Corporation 1995 Long-Term Incentive Plan (the "Plan") are applicable
to this option, and such provisions are hereby incorporated by reference. All
defined terms contained herein shall have the meanings ascribed to them in the
Plan, except as otherwise provided herein or the context otherwise requires. In
the event of any inconsistency between this option and the Plan, the provisions
of the Plan shall govern unless the context otherwise requires. This option does
not apply toward the maximum number of shares issuable under the Plan.
12. NO LIABILITY OF OPTION. This option is not liable for or subject to, in
whole or in part, the debts, contracts, liabilities or torts of the Optionee nor
shall it be subject to garnishment, attachment, execution, levy or other legal
or equitable process.
13. NO ASSIGNMENT. This option is not transferable otherwise than by will or the
laws of descent and distribution, and is exercisable during the Optionee's
lifetime only by Optionee. Without limiting the generality of the foregoing,
this option may not be assigned, transferred (except as aforesaid), pledged or
hypothecated in any way (whether by operation of law or otherwise), and shall
not be subject to execution, attachment, or similar process, without the prior
written consent of the Company. Any attempted assignment, transfer, pledge, or
hypothecation contrary to the provisions hereof shall be void and ineffective
for all purposes.
14. GOVERNING LAW. This Agreement has been executed in, and shall be deemed to
be performable in, Dallas, Dallas County,
Texas. The parties agree that this
Agreement shall be governed by and construed in accordance with the laws of the
State of
Texas (excluding its conflict of laws rules). The parties further agree
that the courts of the State of
Texas, and any courts whose jurisdiction is
derivative on the jurisdiction of the courts of the State of
Texas, shall have
personal jurisdiction over all parties to this Agreement.
15. ENTIRE AGREEMENT. Except for the Plan, this Agreement constitutes the entire
agreement between the parties pertaining to the subject matter hereof and
supersedes all prior and contemporaneous agreements, representations and
understandings of the parties. No supplement, modification or amendment of this
Agreement shall be binding unless executed in writing by the party to be charged
therewith. No waiver of any of the provisions of this Agreement shall be deemed,
or shall constitute a waiver of any other provision, whether or not similar, nor
shall any waiver constitute a continuing waiver.
16. DUPLICATE ORIGINALS. Duplicate originals of this document shall be executed
by both the Company and the Optionee, each of which shall retain one duplicate
original.
17. NOTICE. Other than any Exercise Notice, any notice required or permitted to
be given under the Plan or this Agreement shall be in writing and delivered in
person or sent by registered or certified mail, return receipt requested,
first-class postage prepaid, (i) if to the Optionee, at the
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address shown on the books and records of the Company or at the Optionee's place
of employment, or (ii) if to the Company, at 0000 X. Xxxxxxx Xxxxxx, Xxxxx 0000,
XX 00, Xxxxxx, Xxxxx 00000-0000: Attention: Treasurer, or any other address that
may be given by either party to the other party by notice pursuant to this
Paragraph. Any notice other than any Exercise Notice, if sent by registered or
certified mail, shall be deemed to have been given when received.
ZIXIT CORPORATION
By:
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Xxxx X. Xxxx
Chairman and Chief Executive Officer
OPTIONEE:
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