EXHIBIT 10.15
FORM DOCUMENT Option # 30
NET RADIO CORPORATION
INCENTIVE STOCK OPTION AGREEMENT
THIS AGREEMENT is entered into and effective as of ____________________,
_____, (the "Date of Grant"), by and between NET RADIO CORPORATION (the
"Company") and ____________________ (the "Optionee").
A. The Company has adopted the Net Radio Corporation 1998 Stock Option
and Incentive Plan (the "Plan") authorizing the Board of Directors of the
Company, or a committee as provided for in the Plan (the Board or such a
committee to be referred to as the "Committee"), to grant incentive stock
options to eligible employees of the Company, which options will qualify as
"incentive stock options" within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended (the "Code").
B. The Company desires to give the Optionee an inducement to acquire a
proprietary interest in the Company and an added incentive to advance the
interests of the Company by granting to the Optionee an option to purchase
shares of common stock of the Company pursuant to the Plan.
Accordingly, the parties hereby agree as follows:
ARTICLE 1. GRANT OF OPTION. The Company hereby grants to the Optionee the
right, privilege, and option (the "Option") to purchase ____________________
thousand (__________) shares (the "Option Shares") of the Company's common
stock, no par value share (the "Common Stock"), according to the terms and
subject to the conditions hereinafter set forth and as set forth in the Plan.
The Option is intended to be an "incentive stock option," as that term is used
in Section 422 of the Code.
ARTICLE 2. OPTION EXERCISE PRICE. The per share price to be paid by Optionee
in the event of an exercise of the Option shall be $______.
ARTICLE 3. DURATION OF OPTION AND TIME OF EXERCISE.
3.1 INITIAL PERIOD OF EXERCISABILITY. The Option shall become
exercisable with respect to the Option Shares in five installments. The
following table sets forth the initial dates of exercisability of each
installment and the number of Option Shares as to which this Option shall become
exercisable on such dates:
INITIAL DATE OF NUMBER OF OPTION SHARES
EXERCISABILITY AVAILABLE FOR EXERCISE
--------------- -----------------------
January 1, 1999
June 1, 1999
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June 1, 2000
June 1, 2001
June 1, 2002
The foregoing rights to exercise this Option shall be cumulative with respect to
the Option Shares becoming exercisable on each such date but in no event shall
this Option be exercisable after, and this Option shall become void and expire
as to all unexercised Option Shares at, 5:00 p.m. (Minneapolis, Minnesota time)
on May 31, 2003 (the "Time of Termination").
3.2 TERMINATION OF EMPLOYMENT. Except as otherwise provided in Section
3.3 below:
(a) In the event that the Optionee's employment with the Company and all
Affiliates (as defined in the Plan) is terminated by reason of the Optionee's
death, Disability or Retirement (as such terms are defined in the Plan), this
Option shall remain exercisable to the extent exercisable as of such termination
for a period of three months after such termination in the event of the
Optionee's death or Retirement and for a period of one year after such
termination in the event of the Optionee's Disability (but in no event after the
Time of Termination).
(b) In the event the Optionee's employment with the Company and
Affiliates is terminated voluntarily by Optionee, for "cause" by the Company, or
for any reason other than the events described in Section 3.2(a) above, all
rights of the Optionee under the Plan and this Agreement shall immediately
terminate without notice of any kind, and this Option shall no longer be
exercisable; provided, however, that with respect to performance Option
previously granted hereunder that have fully vested prior to such termination,
such fully vested Options shall remain exercisable for a period of thirty (30)
days after the date of Optionee's termination of employment for reasons other
than death, Disability or Retirement.
3.3 CHANGE IN CONTROL.
(a) For purposes of this Section 3.3, the term "Change in Control" shall
have the meaning set forth in Section 12.1 of the Plan.
(b) If any events constituting a Change in Control of the Company shall
occur, then this Option shall become immediately exercisable in full until the
Time of Termination, whether or not the Optionee remains in the employ of the
Company or any Affiliate. In addition, if a Change in Control of the Company
shall occur, the Committee, in its discretion, and without the consent of the
Optionee, may determine that the Optionee shall receive, with respect to some or
all of the Option Shares, as of the effective date of any such Change in Control
of the Company, cash in an amount equal to the excess of the Fair Market Value
(as defined in the Plan) of such Option Shares immediately prior to the
effective date of such Change in Control of the Company over the option exercise
price per share of this Option.
(c) Notwithstanding anything in this Section 3.3 to the contrary, if,
with respect to the Optionee, acceleration of the exercisability of this Option
or the payment of cash in exchange for all or part of this Option as provided
above (which acceleration or payment could be deemed a payment within the
meaning of Section 280G(b)(2) of the Code), together with any other payments
which the Optionee has the right to receive from the Company or any corporation
which is a member of an "affiliated group" (as defined in Section 1504(a) of the
Code without regard to
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Section 1504(b) of the Code), of which the Company is a
member, would constitute a "parachute payment" (as defined in Section 280G(b) of
the Code), the payments to the Optionee as set forth herein shall be reduced to
the largest amount as will result in no portion of such payments being subject
to the excise tax imposed by Section 4999 of the Code.
ARTICLE 4. MANNER OF OPTION EXERCISE.
4.1 NOTICE. This Option may be exercised by the Optionee in whole or in
part from time to time, subject to the conditions contained in the Plan and
herein, by delivery, in person or by registered mail, to the Company at its
principal executive office in Minneapolis, Minnesota (Attention: President), of
a written notice of exercise. Such notice shall be in a form satisfactory to
the Committee, shall identify the Option, shall specify the number of Option
Shares with respect to which the Option is being exercised, and shall be signed
by the person or persons so exercising the Option. Such notice shall be
accompanied by payment in full of the total purchase price of the Option Shares
purchased. In the event that the Option is being exercised, as provided by the
Plan and Section 3.2 above, by any person or persons other than the Optionee,
the notice shall be accompanied by appropriate proof of right of such person or
persons to exercise the Option. As soon as practicable after the effective
exercise of the Option, the Optionee shall be recorded on the stock transfer
books of the Company as the owner of the Option Shares purchased, and the
Company shall deliver to the Optionee one or more duly issued stock certificates
evidencing such ownership.
4.2 PAYMENT. At the time of exercise of this Option, the Optionee shall
pay the total purchase price of the Option Shares to be purchased solely in cash
(including a personal check or a certified or bank cashier's check, payable to
the order of the Company); provided, however, that the Committee, in its
discretion, may allow such payments to be made, in whole or in part, by delivery
of a Broker Exercise Notice or a promissory note (containing such terms and
conditions as the Committee may in its discretion determine), by transfer from
the Optionee to the Company of Previously Acquired Shares, or by a combination
thereof. The Committee may, in its discretion, permit the Optionee to pay all
or part of the total purchase price by having the Company withhold from the
shares of Common Stock that would otherwise be issued upon exercise the number
of shares of Common Stock having a Fair Market Value (as of the date of
exercise) equal to the aggregate option exercise price for the shares with
respect to which such election is made. For purposes of this Agreement, the
terms "Broker Exercise Notice" and "Previously Acquired Shares" shall have the
meanings set forth in the Plan. In the event the Optionee is permitted to pay
the total purchase price of this Option in whole or in part with Previously
Acquired Shares, the value of such shares shall be equal to their Fair Market
Value on the date of exercise of this Option.
ARTICLE 5. NONTRANSFERABILITY; RIGHTS OF FIRST REFUSAL AND REPURCHASE.
5.1 NONTRANSFERABILITY. Neither this Option nor the Option Shares
acquired upon exercise may be transferred by the Optionee, either voluntarily or
involuntarily, or subjected to any lien, directly or indirectly, by operation of
law or otherwise, except as provided in this Agreement and the Plan. Any
attempt to transfer or encumber this Option or the Option Shares other than in
accordance with this Agreement and the Plan shall be null and void and shall
void this Option.
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5.2 RIGHTS OF FIRST REFUSAL. If the Optionee receives a bona fide offer
from another corporation, entity, person or group (the "Purchaser") to purchase
a specified number of the Option Shares acquired upon exercise by the Optionee,
and wishes to accept such offer, the Optionee shall promptly give written notice
to the Company of the identity of the Purchaser, the number of the Option Shares
the Purchaser wishes to purchase and the proposed price and terms of the sale.
The Company shall have the right, exercisable by giving written notice to the
Optionee within sixty (60) days after the Company's receipt of such notice, to
purchase (or to cause a corporation, entity, person or group designated by the
Company to purchase) all or any portion of the Option Shares, in its discretion,
either at the price and on the terms stated in the notice or at the price per
share determined by dividing the aggregate net book value of the Company as of
the end of the calendar month ended next prior to the date of receipt by the
Company of the notice from the Optionee described above, divided by the
aggregate number of issued and outstanding shares of Common Stock of the Company
on a fully diluted basis (the "Book Value Per Share"). If the Company (or its
designee) does not exercise its option within the time period provided above
with respect to any of the Option Shares, the Optionee shall be free to accept
the bona fide offer and sell any of the Option Shares as to which the Company
shall not have exercised its option, provided that any such sale shall be at the
price and on the terms specified in the notice to the Company and shall be
consummated within sixty (60) days after expiration of the 60-day period allowed
the Company above. If the Company exercises its option with respect to all of
the Option Shares, the closing of the purchase will take place at a time and
location designated by the Company, but in any event within thirty (30) days
after the date on which the Company gave notice of exercise. At such closing,
the Optionee shall deliver to the Company the certificate or certificates
evidencing the Option Shares, properly endorsed and assigned in writing, and
thereupon by force hereof and without further act or agreement, the Optionee
shall warrant that he or she has good title, right to possession of and right to
sell the Option Shares free and clear of any and all claims, liens,
encumbrances, restrictions or other adverse claims.
5.3 RIGHTS OF REPURCHASE. Upon the termination of the Optionee's
employment with the Company for any reason, whether voluntary or involuntary,
the Company shall have the right, exercisable by giving written notice to the
Optionee within six (6) months after the termination of the Optionee's
employment with the Company, to purchase (or to cause a corporation, entity,
person or group designated by the Company to purchase) all or any portion of the
Option Shares then owned or that may thereafter be acquired by the Optionee
hereunder, at the Book Value Per Share, as defined above, determined as of the
end of the calendar month ending next prior to the date of termination of the
Optionee's employment with the Company. If the Company exercises its option
with respect to any of the Option Shares hereunder, the closing of the purchase
will take place at a time and location designated by the Company, but in any
event within thirty (30) days after the date on which the Company gave notice of
exercise. At such closing, the Optionee shall deliver to the Company the
certificate or certificates evidencing the Option Shares, properly endorsed and
assigned in writing, and thereupon by force hereof and without further act or
agreement, the Optionee shall warrant that he or she has good title, right to
possession of and right to sell the Option Shares free and clear of any and all
claims, liens, encumbrances, restrictions or other adverse claims.
ARTICLE 6. LIMITATION OF LIABILITY. Nothing in this Agreement shall be
construed to
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(a) limit in any way the right of the Company to terminate the
employment of the Optionee at any time, or (b) be evidence of any agreement or
understanding, express or implied, that the Company will retain the Optionee in
any particular position, at any particular rate of compensation or for any
particular period of time.
ARTICLE 7. WITHHOLDING TAXES. The Company is entitled to (a) withhold and
deduct from future wages of the Optionee (or from other amounts which may be due
and owing to the Optionee from the Company), or make other arrangements for the
collection of, all legally required amounts necessary to satisfy any federal,
state or local withholding and employment-related tax requirements attributable
to the grant or exercise of this Option or to a disqualifying disposition of the
Option Shares acquired upon exercise of this Option, or otherwise incurred with
respect to this Option, or (b) require the Optionee promptly to remit the amount
of such withholding to the Company before acting on the Optionee's notice of
exercise of this Option. In the event that the Company is unable to withhold
such amounts, for whatever reason, the Optionee hereby agrees to pay to the
Company an amount equal to the amount the Company would otherwise be required to
withhold under federal, state or local law.
ARTICLE 8. ADJUSTMENTS. In the event of any reorganization, merger,
consolidation, recapitalization, liquidation, reclassification, stock dividend,
stock split, combination of shares, rights offering or extraordinary dividend or
divestiture (including a spin-off) or any other change in the corporate
structure or shares of the Company, the Committee (or, if the Company is not the
surviving corporation in any such transaction, the board of directors of the
surviving corporation), in order to prevent dilution or enlargement of the
rights of the Optionee, shall make appropriate adjustment (which determination
shall be conclusive) as to the number, kind and exercise price of securities
subject to this Option.
ARTICLE 9. SUBJECT TO PLAN. The Option and the Option Shares granted and
issued pursuant to this Agreement have been granted and issued under, and are
subject to the terms of, the Plan. The terms of the Plan are incorporated by
reference herein in their entirety, and the Optionee, by execution hereof,
acknowledges having received a copy of the Plan. The provisions of this
Agreement shall be interpreted as to be consistent with the Plan, and any
ambiguities herein shall be interpreted by reference to the Plan. In the event
that any provision hereof is inconsistent with the terms of the Plan, the terms
of the Plan shall prevail.
ARTICLE 10. MISCELLANEOUS.
10.1 BINDING EFFECT. This Agreement shall be binding upon the heirs,
executors, administrators and successors of the parties hereto.
10.2 GOVERNING LAW. This Agreement and all rights and obligations
hereunder shall be construed in accordance with the Plan and governed by the
laws of the State of Minnesota.
10.3 ENTIRE AGREEMENT. This Agreement and the Plan set forth the entire
agreement and understanding of the parties hereto with respect to the grant and
exercise of this Option and the administration of the Plan and supersede all
prior agreements, arrangements, plans and understandings relating to the grant
and exercise of this Option and the administration of the Plan.
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10.4 AMENDMENT AND WAIVER. Other than as provided in the Plan, this
Agreement may be amended, waived, modified or canceled only by a written
instrument executed by the parties hereto or, in the case of a waiver, by the
party waiving compliance.
The parties hereto have executed this Agreement effective the day and year
first above written.
NET RADIO CORPORATION
By: ______________________________
Xxxx X. Xxxxxxx
Its Chairman and President
[By execution hereof, the Optionee OPTIONEE:
acknowledges having received a
copy of the Plan.]
______________________________
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