XxxxxxXxxxxxxx.xxx Inc.
Employee Stock Option Agreement
This Agreement, is effective as of September 15, 1999, between
XxxxxxXxxxxxxx.xxx Inc., a Nevada corporation (the "Company"),
and Xxxx Xxxxxxxxx ("Grantee").
WHEREAS, Company has agreed to employ Grantee; and
WHEREAS, the Company desires to provide an incentive to Grantee
to encourage stock ownership and to remain an employee of the
Company; and
WHEREAS, the achievement of these goals will be assisted by the
grant of a non-qualified option to purchase shares of the
Company's Class A Common Stock, $.01 par value (the "Class A
Common Stock");
NOW, THEREFORE, the parties agree as follows:
1. Grant of Option. The Company hereby grants to Grantee, subject
to the terms and conditions herein set forth, the right and
option to purchase from the Company all or any part of an
aggregate of 2,000,000 (two million) shares of Class A Common
Stock, vesting over a three year period from the Grantee's date
of hire, at the purchase price of $35 (thirty-five cents) per
share. Such option to be exercisable as hereinafter provided.
2. Terms and Conditions. The option evidenced hereby is subject
to the following terms and conditions
(A) Expiration Date. The option shall expire on December 31,
2009.
(B) Exercise of Option.
One third of the option is vested on the dates of each of the
Grantee's annual service anniversaries for a period of three
years from the date of hire. It may be exercised, in whole or in
part, at any time (from time to time) after the third service
year anniversary, before the expiration date of the option as
provided in paragraph (a) above. A written notice shall accompany
any exercise to the Company specifying the number of shares as to
which the option is being 1 exercised. If Grantee shall so
request, shares of the Class A Common Stock purchased upon
exercise of an option may be issued in the name of Grantee or
another person.
(C) Payment of Purchase Price.
At the time of any exercise, Grantee shall deliver to the
Company, together with the notice provided in paragraph (b)
above, the full amount of the purchase price therefore either by
bank cashiers check or certified check payable to the Company or
in Class A Common Stock delivered by Grantee valued at the
Closing Price of the Class A Common Stock, or any combination of
cash or Class A Common Stock. The term "Closing Price" shall be
the last sale price on the date of the exercise of the option or,
in the case no sale takes place on such date, the average of the
high and low sales prices on the next preceding trading day, in
either case as reported by NASDAQ, or if the shares of Class A
Common Stock are not listed or admitted to trading on NASDAQ, the
average high bid and low asked prices on the principal National
Securities Exchange in which the Class A Common Stock is listed
or admitted to trading. If the Class A Common Stock is not traded
such that the Closing Price can be determined in accordance with
the preceding sentence, the Closing Price shall mean the fair
market value of the Class A Common Stock as of the last day of
the measuring period as determined by an independent investment
banker approved by the Company and Grantee.
(D) Exercise Upon Termination of Employment.
After vesting, any option granted hereunder may be exercised by
Grantee, his heirs, devises, legatees, legal representative or
assigns at any time up to and including December 31, 2009,
whether or not Grantee shall cease to be an employee of the
Company for any reason, including, without limitation,
termination by voluntary resignation, by action of the Company,
for cause, without cause, or by reason of death or disability.
(E) Transferability of Option and Shares Acquired Upon Exercise
of Option.
This option shall be transferable only by will or the laws of
descent and distribution; provided Grantee may transfer the
option only with the consent of the Company. Except as limited by
applicable securities laws, shares of Class A Common Stock
acquired upon exercise of this option hereunder shall be freely
tradeable.
(F) Adjustment of the Changes in the Stock.
(i) In the event the shares of Class A Common Stock, as
presently constituted, shall be changed into or
exchanged for a different number or kind of shares of
stock o other securities of the Company or of another
corporation (whether by reason o merger, consolidation,
recapitalization, reclassification, split, reverse
split, combination of shares, or otherwise) or if the
number of such shares of Class A Common Stock shall be
increased through the payment of a stock dividend, then
there shall be substituted for or added to each share
of Class A Common Stock theretofore appropriated or
thereafter subject or which may become subject to an
option, the number and kind of shares of stock or other
securities into which each outstanding share of Class A
Common Stock shall be so changed, or to which each such
share shall be entitled, as the case may be.
Outstanding options shal also be appropriately amended
as to price and other terms as may be necessary to
reflect the foregoing events, and immediately vested in
their entirety.
(ii) Further, in the event of a reorganization,
recapitalization, stock split, stock dividend,
combination of shares, consolidation, merger (other
than a merger or consolidation which does not result in
any reclassification, conversion, exchange or
cancellation of outstanding shares), any sale or
transfer by the Company of al or substantially all of
its assets or any tender offer or exchange offer for or
th acquisition, directly or indirectly, by any person
or group of all or a majority of th then outstanding
voting securities of the Company, rights offering, or
any othe change in the corporate structure or rights
with respect to any shares of th Company, adjustments
shall be made to the number or type of stock subject to
thi Agreement and, in order to prevent dilution or
enlargement of the rights o Grantee, to the number of
shares of Class A Common Stock subject to the option
and the type and option price of the Class A Common
Stock subject to the then outstanding option.
(G) Withholding.
Grantee may elect that shares of the Class A Common Stock valued
at the Closing Price b applied towards the payment of withholding
taxes.
(3) Registration.
The Company shall register all the shares underlying the option
on a Registration Statement with the Registration Statement filed
for the shares underlying the Company's 1999 Stock Option and
Restricted Stock Plan (the "Plan") or on Form S-8 as soon as
reasonably practical after the filing of the Registration
Statement for the Plan, but in no event later than 120 days after
the date the Class A Common Stock shall first be traded on NASDAQ
(on other than a when issued basis). If the shares underlying the
option granted hereunder have not been registered by the Company
by the date of exercise of the option, the Company shall cause
such shares to be registered on Form S-3 upon Grantee's exercise
of the option.
(4) Non-Qualified Stock Options.
The Company and Grantee acknowledge the stock options granted
hereunder shall be treated as nonqualified stock options for U.S.
federal income tax purposes.
(5) Grantee to Have No Rights as a Stockholder.
With regard to the stock underlying the option (from time to
time) Grantee shall not have the rights of a stockholder until
Grantee has timely exercise the option relating to such stock and
paid in full the option price relating thereto.
(6) Notice.
Notice to the Company shall be deemed given if in writing and
mailed to the Secretary of the Company at its principal executive
offices by first class, certified mail at the then principal
office of the Company.
(7) Governing Law.
This Agreement shall be construed and enforced in accordance
with, and governed by, the laws of the State of Nevada.
(8) Binding Agreement.
This Agreement constitutes the binding agreement of the parties
with respect to the grant of options to Grantee. The Company
represents and warrants to Grantee that this Agreement and the
grant of options hereunder have been duly authorized pursuant to
any necessary corporate action. This Agreement may not be
modified except by the mutual agreement of the parties in
writing. In the event of any overlap, inconsistency,
contradiction or any other conflict between this Agreement and
any other agreement, option plan, policy or other statement, this
Agreement shall be controlling.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year written above.
XxxxxxXxxxxxxx.xxx Inc. Employee
Xxxx Xxxxxxxxx Xxxxx Xxxxxxx
Chairman and CEO Director and Secretary
XxxxxxXxxxxxxx.xxx XxxxxxXxxxxxxx.xxx
