STOCK OPTION AGREEMENT
Exhibit 10.2
EMPLOYEE FORM
This Agreement is dated as of [Date] and is entered into by and between Westwood One, Inc.
(“Westwood” or “Company”) and [Name] (“Participant”). Reference is made to the Company’s 2010
Equity Compensation Plan (the “Plan”). Pursuant to the Plan, the Company grants a Non-Qualified
Stock Option or an Incentive Stock Option (either, a “Stock Option” herein) to purchase shares of
the Common Stock, $.01 par value per share, of the Company (“Common Stock”) as set forth below. A
summary is set forth in the attached Exhibit “A” which is incorporated by this reference.
Notwithstanding anything herein to the contrary, the Stock Option awarded herein is subject to
approval of the Plan by the stockholders of the Company at or prior to the 2010 Annual Meeting of
Stockholders of the Company and in the event that such approval is not received, this Agreement
shall be null and void ab initio and the Stock Option awarded herein shall not be valid.
The parties agree to the following terms and conditions:
| 1. | Definitions. Unless otherwise defined in this Agreement, terms used in this
Agreement will have the meanings as set forth in the Plan. |
| 2. | Grant of Stock Option. The Company grants to Participant a Stock Option of the type
set forth in Exhibit “A” to purchase all or part of [Number] shares of Common Stock at the
price of $ per share subject to the terms and conditions of the Plan. The number of
shares subject to such Stock Option and the price per share are subject to adjustment in
certain events as provided in the Plan. |
| 3. | Term of Stock Option. |
| A. | Unless otherwise terminated pursuant to this Agreement or the Plan, each
Non-Qualified Stock Option will expire as provided in Paragraph 6 hereof. However,
expiration will not occur later than ten years from the date of grant. |
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| B. | Each Incentive Stock Option will expire as provided in Paragraph 6 hereof, but
not later than ten years from the date of grant, or five years in the case of a Ten
Percent Stockholder. |
| 4. | Vesting of Stock Option. The Stock Option may be exercised, in whole or in part, at
any time or from time to time during the balance of the term of the Stock Option pursuant to
the vesting schedule set forth in Exhibit “A”, subject to Paragraphs 7 and 12 hereof. [ADD IF
DESIRED: Notwithstanding the forgoing, in the event that a written employment agreement
between the Company and the Participant provides for a vesting schedule that is more favorable
than the vesting schedule provided in this Agreement, then the vesting schedule in such
employment agreement shall govern, provided that such
employment agreement is in effect on the date of grant and that such vesting schedule set
forth in such employment agreement applies to the Stock Option granted herein.] The minimum
number of shares of Common Stock for which this Stock Option may be exercisable at any one
time is one hundred (100), unless the number of shares exercisable thereunder is less than
one hundred (100). The Stock Option may only be exercised by the Participant (or by his or
her guardian or legal representative), except as provided in Subparagraph 6.A. hereof in the
case of the Participant’s death. |
| 5. | Manner of Exercise. This Stock Option may be exercised in whole or in part, by
delivering to the Company a Notice of Exercise identical to Exhibit “B” attached to this
Agreement stating the number of shares with respect to which the Stock Option is being
exercised. The Company will have no obligation upon exercise of any Stock Option, until
payment has been received by the Company for all sums due with respect to such exercise,
including the Participant’s federal, state and local income and employment taxes. Shares of
Common Stock purchased upon the exercise of this Stock Option must be paid for in full by one
or a combination of the following methods: (i) in cash or by check, bank draft or money order
payable to the order of the Company; (ii) solely to the extent permitted by applicable law, if
the Common Stock is traded on any national securities exchange, and the Committee authorizes,
through a procedure whereby the Participant delivers irrevocable instructions to a broker
reasonably acceptable to the Committee to deliver promptly to the Company an amount equal to
the purchase price; or (iii) on such other terms and conditions as may be acceptable to the
Committee (including, without limitation, the relinquishment of Stock Options or by payment in
full or in part in the form of shares of Common Stock for which the Participant has good title
free and clear of any liens and encumbrances) based on the Fair Market Value of the Common
Stock on the payment date as determined by the Committee). |
| 6. | Termination. |
| A. | Upon the Participant’s termination of service all then vested Stock Options
shall remain exercisable as follows, but in no event later than ten years after the
grant date: (i) three years in the event of the Participant’s Retirement; (ii) one year
in the event of the Participant’s death (in which case the Participant’s estate or
legal representative may exercise such Stock Option) or (iii) three months for any
other termination of service (other than for Cause). [ADD IF DESIRED: Notwithstanding
the forgoing, in the event that a written employment agreement between the Company and
the Participant provides for exercise periods following termination of service that are
more favorable than the exercise periods provided in this Agreement, then the exercise
periods in such employment agreement shall govern, provided that such employment
agreement is in effect on the date of grant and that such exercise periods set forth in
such employment agreement apply to the Stock Option granted herein.] |
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| B. | Upon the Participant’s termination of service for Cause, all outstanding Stock
Options (whether vested or unvested) shall immediately terminate upon such
termination. |
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| C. | Stock Options that are not vested as of the date of the Participant’s
termination of service for any reason shall terminate and expire as of the date of such
termination. |
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| 7. | [ADD IF DESIRED AND CHANGE IN CONTROL VESTING PROVISION IS NOT ADDED TO “EXHIBIT A”:
Change in Control. This Stock Option shall be subject to the provisions of the Plan
and unless there is a written employment agreement between the Company and the Participant
that provides for vesting upon a Change in Control or upon the occurrence of an event (i.e., a
termination of employment) following a Change in Control, then unless otherwise provided by
the Committee in its sole discretion, this Stock Option will not vest upon a Change in Control
or upon the occurrence of an event following a Change in Control.] |
| 8. | Assignment or Transfer. This Stock Option is not: (i) assignable or subject to any
encumbrance, pledge or charge of any nature, whether by operation of law or otherwise; (ii)
subject to execution, attachment or any legal or quasi-legal process similar to execution or
attachment; or (iii) transferable other than by will or by the laws of descent and
distribution. |
| 9. | No Rights as Stockholder. The Participant, and any beneficiary or other person
claiming under or through him or her, will not have any right, title or interest in or to any
shares of Common Stock allocated or reserved for the Plan or subject to this Stock Option
except as to such shares of Common Stock, if any, as have been previously sold, issued or
transferred to him or her. |
| 10. | Modification and Termination. The rights of the Participant are subject to
modification and termination in certain events as provided in the Plan. The Participant
acknowledges receipt of a copy of the Plan by signing and returning a copy of this Agreement
to the Company. Except as otherwise provided in the Plan, no amendment or discontinuance of
the Plan will adversely affect this Stock Option, except with the consent of the Participant.
No modification of this Agreement may be made other than in a writing signed by the Company
and the Participant. |
| 11. | Securities Representations. The grant of this Stock Option and issuance of shares of
Common Stock upon exercise of this Stock Option shall be subject to, and in compliance with,
all applicable requirements of federal, state or foreign securities law. No shares of Common
Stock may be issued hereunder if the issuance of such Common Stock would constitute a
violation of any applicable federal, state or foreign securities laws or other law or
regulations or the requirements of any stock exchange or market system upon which the Common
Stock may then be listed. As a condition to the exercise of the Stock Options, the Company
may require the Participant to satisfy any qualifications that may be necessary or appropriate
to evidence compliance with any applicable law or regulation. |
The Common Stock is being issued to the Participant and this Agreement is being made by the
Company in reliance upon the following express representations and warranties of the
Participant. The Participant acknowledges, represents and warrants that:
| A. | the Participant has been advised that the Participant may be an “affiliate”
within the meaning of Rule 144 under the Securities Act and in this connection the
Company is relying in part on the Participant’s representations set forth in this
Section; |
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| B. | the Common Stock must be held indefinitely by the Participant unless (i) an
exemption from the registration requirements of the Securities Act is available for the
resale of such Shares or (ii) the Company files an additional registration statement
(or a “re-offer prospectus”) with regard to the resale of such Common Stock and the
Company is under no obligation to continue in effect a Form S-8 Registration Statement
or to otherwise register the resale of the Common Stock (or to file a “re-offer
prospectus”); |
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| C. | the exemption from registration under Rule 144 will not be available under
current law unless (i) a public trading market then exists for the Common Stock, (ii)
adequate information concerning the Company is then available to the public, and (iii)
other terms and conditions of Rule 144 or any exemption therefrom are complied with and
that any sale of the Common Stock may be made only in limited amounts in accordance
with such terms and conditions. |
| 12. | Six (6) Month Holding Period. A Participant is prohibited from selling or otherwise
disposing of shares of Common Stock received upon the exercise of this Stock Option within six
(6) months from the date the Stock Option is granted. |
| 13. | No Obligation to Continued Service. This Agreement is not an agreement of employment
or for other services. This Agreement does not guarantee that the Company will employ or
retain the Participant for any specific time period, nor does it modify in any respect the
Company’s right to terminate or modify the Participant’s service relationship or compensation
at any time. |
| 14. | Provisions of Plan Control. This Agreement is subject to all of the terms,
conditions and provisions of the Plan, including, without limitation, the amendment provisions
thereof, and to such rules, regulations and interpretations relating to the Plan as may be
adopted by the Committee and as may be in effect from time to time. The Plan is incorporated
herein by reference. If and to the extent that this Agreement conflicts or is inconsistent
with the terms, conditions and provisions of the Plan, the Plan shall control, and this
Agreement shall be deemed to be modified accordingly. This Agreement contains the entire
understanding of the parties with respect to the subject matter hereof (other than any
exercise notice or other documents expressly contemplated herein or in the Plan) and
supersedes any prior agreements between the Company and the Participant with respect to the
subject matter hereof. |
[Remainder of Page Left Blank]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
| WESTWOOD ONE, INC. | PARTICIPANT | |||||||||
By:
|
By: | |||||||||
| (Signature) | (Signature) | |||||||||
Name:
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Name: | |||||||||
| (Type or Print) | (Type or Print) | |||||||||
Title:
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Date: | [Date] | ||||||||
Date:
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[Date] | |||||||||
THE UNDERSIGNED HEREBY ACKNOWLEDGES THAT HE OR SHE HAS RECEIVED A COPY OF THE PLAN.
| By: | ||||||
| Date: | ||||||
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EXHIBIT “A”
1.
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Participant: | [Name] | ||
2.
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No. of shares of Common Stock subject to the Stock Option Granted: | [Number] | ||
3:
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Exercise Price: | $ | ||
4.
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Type of Option Granted | |||
| (Incentive/Non-Qualified): | Non-Qualified | |||
5.
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Date of Grant: | [Date] | ||
6.
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Vesting Schedule: | Except as provided in Paragraph 7 of the Agreement, this Stock Option shall vest in three equal annual installments on each of [insert vesting date], subject to the Participant’s continued service with the Company on each applicable vesting date. [ADD IF DESIRED: Notwithstanding the foregoing, this Stock Option shall become 100% vested in the event of the Participant’s Termination without Cause upon or within 24 months following the date of a Change in Control]. | ||
7.
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Expiration Date: | 10 years after the Date of Grant, subject to earlier termination as provided in the Agreement. |
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EXHIBIT “B”
NOTICE OF EXERCISE
(To be signed only upon exercise of the Option)
(To be signed only upon exercise of the Option)
TO: Westwood One, Inc. (“Westwood” or “Company”)
The undersigned, the holder of a Stock Option to purchase shares of
the Company’s Common Stock pursuant to the enclosed Stock Option Agreement dated [Date], hereby
irrevocably elects to exercise the purchase rights represented by the Stock Option and to purchase
thereunder shares of Common Stock and herewith encloses a certified or cashier’s check
in the amount of $ and/or shares of the Company’s Common Stock in full payment of the exercise price and all federal and
state income taxes required to be paid in connection with the purchase of such shares.
Dated:
| By: | ||||||
| (Signature must conform in all respects to name of holder as specified on the face of the Option). | ||||||
| Name: | ||||||
| (Print or Type) | ||||||
| (Address) | ||||||
| (Social Security Number) | ||||||
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