EXHIBIT 4.2
FORM OF NON-QUALIFIED STOCK OPTION AGREEMENT
(with graded vesting)
THIS AGREEMENT, entered into as of the Grant Date (as defined in
Section 1), by and between the Participant and Xxxxxx Interactive Inc. (the
"Company");
IT IS AGREED, by and between the Company and the Participant, as
follows:
1. Terms of Award. The following terms used in this Agreement shall
have the meanings set forth in this Section 1:
(a) The "Participant" is ____________________________________.
(b) The "Grant Date" is March 2, 2004.
(c) The number of "Covered Shares" shall be 50,000 shares of common
stock ("Stock") of the Company.
(d) The "Initial Exercise Date" is the One-year anniversary of the
Grant Date.
(e) The "Exercise Price" is US$8.55 per share.
Other terms used in this Agreement are defined in Section 11 or elsewhere in
this Agreement.
2. Award and Exercise Price. The Participant is hereby granted an
option (the "Option") to purchase the number of Covered Shares of Stock at the
Exercise Price per share as set forth in Section 1. The Option is not intended
to qualify as an "Incentive Stock Option," as defined in the Plan and in Section
422(b) of the United States Internal Revenue Code of 1986 as amended from time
to time.
3. Date of Exercise. The Option shall become exercisable with respect
to:
(a) 25% of the Covered Shares as of the Initial Exercise
Date; and
(b) 1/48th of the Covered Shares as of the end of each of the
next 36 calendar months thereafter.
The Option shall not become exercisable as to additional Covered Shares in
accordance with the foregoing schedule, after the Participant's Date of
Termination (as herein defined). Exercisability under this schedule is
cumulative, and after the Option becomes exercisable under the schedule with
respect to any portion of the Covered Shares, it shall continue to be
exercisable with respect to that portion of the Covered Shares until the Option
expires. Notwithstanding the foregoing provisions of this Section 3, the Option
shall become immediately exercisable with respect to all of the Covered Shares
(e.g., 100% vested) as follows:
(a) Following the Initial Exercise Date, the Option shall become fully
exercisable (e.g., 100% vested) upon the date of the Participant's Date of
Termination by reason of the Participant's death or Disability.
(b) The Option shall become fully exercisable (e.g., 100% vested) upon
the date of a Change in Control, if the Participant's Date of Termination does
not occur before the Change in Control.
4. Expiration. The Option, to the extent not theretofore exercised,
shall not be exercisable on or after the Expiration Date. The "Expiration Date"
shall be earliest to occur of:
(a) the ten-year anniversary of the Grant Date;
(b) if the Participant's Date of Termination occurs by reason of
Disability or death, the one-year anniversary of such Date of Termination;
(c) If the Participant's Date of Termination occurs for reasons other
than death or Disability, the Date of Termination.
In the event of the Participant's death while in the employ of the Company, the
Participant's executors or administrators (or the person or persons to whom the
Participant's rights under the Option shall have passed by the Participant's
will or by the laws of descent and distribution) may exercise, any unexercised
portion of the Option.
Any Option exercised subsequent to the Participant's Date of
Termination as permitted hereunder shall be exercisable only to the extent
vested at the time of the Participant's Date of Termination, regardless of the
reason for the termination, and no extension of time beyond the Participant's
Date of Termination shall permit exercise beyond the date such Option would
otherwise expire if no termination had occurred.
5. Method of Option Exercise. The Option may be exercised in whole or
in part by filing a written notice with the Chief Financial Officer of the
Company at its corporate headquarters prior to the Expiration Date. Such notice
shall (a) specify the number of shares of Stock which the Participant elects to
purchase; provided, however, that not less than one hundred (100) shares of
Stock may be purchased at any one time unless the number purchased is the total
number of shares available for purchase at that time under the Option, and (b)
be accompanied by payment of the Exercise Price for such shares of Stock
indicated by the Participant's election. Payment shall be by cash or by check
payable to the Company, or, upon request of the Participant but only if approved
by the Company in its sole discretion after receipt of such request: (a) all or
a portion of the Exercise Price may be paid by the Participant by delivery of
shares of Stock acceptable to the Company (including, if the Company so
approves, the withholding of shares otherwise issuable upon exercise of the
Option) and having an aggregate Fair Market Value (valued as of the date of
exercise) that is equal to the amount of cash that would otherwise be required;
or (b) the Participant may pay the Exercise Price by authorizing a third party
to sell shares of Stock (or a sufficient portion of the shares) acquired upon
exercise of the Option and remit to the Company a sufficient portion of the sale
proceeds to pay the entire Exercise Price and any tax withholding resulting from
such exercise. Issuance of shares of Stock upon exercise of the Options may be
effected on a noncertificated basis, to the extent not prohibited by applicable
law or the applicable rules of any stock exchange or a national market system,
including without limitation the Nasdaq National Stock Market.
6. Withholding. All distributions under this Agreement are subject to
withholding of all applicable taxes. At the election of the Participant, and
subject to such rules as may be established by the Company, such withholding
obligations may be satisfied through the surrender of shares of Stock which the
Participant already owns, or to which the Participant is otherwise entitled
under this agreement.
7. Transferability. Except as otherwise provided in this Section 7, the
Option is not transferable other than as designated by the Participant by will
or by the laws of descent and distribution, and during the Participant's life,
may be exercised only by the Participant or by the Participant's guardian or
legal representative.
8. Non-Competition Agreement. In consideration of, and as a condition
to, the grant of this option and in consideration of the other rights and
privileges of a Participant of the Company, Participant agrees that during the
term of Participant's employment or other contractual relationship giving rise
to Participant's services on behalf of the Company and Related Companies, he
shall not, directly or indirectly, as a director, officer, employee, agent,
partner or equity owner (except as owner of less than 1% of the shares of the
publicly traded stock of a corporation) of any entity, compete in any manner
with the Company and Related Companies. Furthermore, Participant agrees that,
for a period of one year after voluntary termination of his employment or other
contractual relationship giving rise to Participant's services on behalf of the
Company and Related Companies, Participant shall not, directly or indirectly, as
a director, officer, employee, agent, partner or equity owner (except as owner
of less than 1% of the shares of the publicly traded stock of a corporation) of
any entity, solicit or otherwise deal in any way with any of the clients or
customers of the Company and Related Companies as of the time of his voluntary
termination (including any client to whom the Company and Related Companies have
sold services or products in the two years prior to termination and any
prospective client or customer for whom a bid has been prepared within the
previous six months) with respect to any services or products competitive with
those of the Company and Related Companies. Participant acknowledges that the
Company's legal remedies for a breach of this provision shall be inadequate and
that the Company shall be entitled to obtain injunctive relief to enforce this
provision.
9. Limitations upon Share Transfer - Hold Harmless Undertaking. The
Participant recognizes that sale or transfer by the Participant of shares
acquired through exercise of the Options granted hereunder ("Option Shares")
prior to a date fixed by the General Tax Code ("the Code"), which date is
presently 4 years from the date of the Option grant (the "Permitted Transfer
Date"), except as such Permitted Transfer Date may be advanced upon the
occurrence of certain events defined in the Code, will give rise to liability on
the part of the Company or of the Related Company which employs or has employed
the Participant (the "Employer") for social security contributions upon a
certain portion of the transfer price as defined by the Code ("Liability"), and
that the Participant's right to sell or transfer the Option Shares is therefore
restricted by the Plan. The Participant therefore undertakes to respect the said
restrictions and, in the event that the Participant shall sell or transfer any
Option Shares prior to the Permitted Transfer Date (unless the Company has
previously determined in its reasonable discretion and confirmed in writing that
such sale or transfer may take place without giving rise to Liability), to
indemnify and hold harmless Employer for any social security contributions
and/or costs which Employer shall be obliged to pay by reason of the
Participant's sale or transfer of Covered Shares. Notwithstanding any other
provision of this Agreement, Employer may, at its election, bring a proceeding
to obtain the indemnity defined in this Section 9 before any competent court
having jurisdiction over the Participant's place of residence.
10. Tax Treatment. The Sub-plan and this grant have been prepared in
order to procure for the benefit of Participants residing in France certain tax
benefits available under the laws of France, provided that the Participant
respects the terms of the Option Agreement; however, the Participant should be
aware that, by reason of the provisions of applicable French laws as of the date
hereof, such benefits may be lost or deferred in the event of a Corporate
Transaction as defined below.
11. Definitions. For purposes of this Agreement, the terms listed below
shall be defined as follows:
(a) Date of Termination. The Participant's "Date of Termination" shall
be the first day occurring on or after the Grant Date on which the Participant's
employment with the Company and all Related Companies terminates for any reason;
provided that a termination of employment shall not be deemed to occur by reason
of a transfer of the Participant between the Company and a Related Company or
between two Related Companies; and further provided that the Participant's
employment shall not be considered terminated while the Participant is on a
leave of absence from the Company or a Related Company approved by the
Participant's employer. If, as a result of a sale or other transaction, the
Participant's employer ceases to be a Related Company (and the Participant's
employer is or becomes an entity that is separate from the Company), the
occurrence of such transaction shall be treated as the Participant's Date of
Termination caused by the Participant being discharged by the employer.
(b) Disability. Except as otherwise provided by the Committee, the
Participant shall be considered to have a "Disability" during the period in
which the Participant is unable, by reason of a medically determinable physical
or mental impairment, to engage in any substantial gainful activity, which
condition, in the opinion of a physician selected by the Committee, is expected
to have a duration of not less than 120 days.
(c) Retirement. "Retirement," as defined by the Company's applicable
retirement plan, or if not formalized under a plan, by the Company's policies
and procedures.
(d) "Related Company(ies)". The term "Related Company" means (i) any
corporation, partnership, joint venture or other entity during any period in
which it owns, directly or indirectly, at least 50% of the voting power of all
classes of stock of the Company (or successor to the Company) entitled to vote;
and (ii) any corporation, partnership, joint venture or other entity during any
period in which at least 50% voting or profits interest is owned, directly or
indirectly, by the Company, by any entity that is a successor to the Company, or
by any entity that is a Related Company by reason of clause (i) next above.
(e) "Fair Market Value". For purposes of determining the "Fair Market
Value" of a share of Stock, the following rules shall apply:
(i) If the Stock is at the time listed or admitted to trading on any
stock exchange or a national market system, including without limitation the
Nasdaq National Market, then the "Fair Market Value" shall be the reported
closing asked price of the Stock on such date on the principal exchange.
(ii) If the Stock is not at the time listed or admitted to trading on a
stock exchange, the "Fair Market Value" shall be the mean between the lowest
reported bid price and highest reported asked price of the Stock on the date in
question in the over-the-counter market, as such prices are reported in a
publication of general circulation selected by the Company and regularly
reporting the market price of Stock in such market.
(iii) If the Stock is not listed or admitted to trading on any stock
exchange or traded in the over-the-counter market, the "Fair Market Value" shall
be as determined in good faith by the Company.
(f) "Change in Control". The term "Change in Control" means a change in
control occurring after the date of this agreement of a nature that would be
required to be reported in a proxy statement with respect to the Company (even
if the Company is not actually subject to said reporting requirements) in
response to Item 6(e) (or any comparable or successor Item) of Schedule 14A of
Regulation 14A promulgated under the United States Securities Exchange Act of
1934, as amended (the "Exchange Act"), except that any merger, consolidation or
corporate reorganization in which the owners of the Company's capital stock
entitled to vote in the election of directors (the "Voting Stock") prior to said
combination receive 75% or more of the resulting entity's Voting Stock shall not
be considered a change in control for the purposes of this Plan; and provided
that, without limitation of the foregoing, such change in control shall be
deemed to have occurred if (i) any "person" (as that term is used in Sections
13(d) and 14(d)(2) of the Exchange Act, excluding any stock purchase or employee
stock ownership plan maintained by the Company or a Related Company) becomes the
"beneficial owner" (as that term is defined by the Securities and Exchange
Commission for purposes of Section 13(d) of the Exchange Act), directly or
indirectly, of more than 15% of the outstanding Voting Stock of the Company or
its successors; or (ii) during any period of two consecutive years a majority of
the Board of Directors no longer consists of individuals who were members
of the Board of Directors at the beginning of such period, unless the election
of each director who was not a director at the beginning of the period was
approved by a vote of at least 75% of the directors still in office who were
directors at the beginning of the period.
12. Corporate Transactions. In the event of a corporate transaction
involving the Company (including, without limitation, any stock dividend, stock
split, recapitalization, reorganization, merger, consolidation, split-up,
spin-off, combination or exchange of shares), the Company (a) will make any
appropriate adjustments to the Covered Shares to preserve the benefits intended
by this agreement. Action by the Company may include adjustment of the number
and kind of shares which may be delivered hereunder and adjustment of the
Exercise Price of outstanding Options; as well as any other adjustments that the
Company determines to be equitable.
13. Heirs and Successors. This Agreement shall be binding upon, and
inure to the benefit of, the Company and its successors and assigns, and upon
any person acquiring, whether by merger, consolidation, purchase of assets or
otherwise, all or substantially all of the Company's assets and business. In the
event of the Participant's death prior to exercise of this Award, the Award may
be exercised by the estate of the Participant to the extent such exercise is
otherwise permitted by the Agreement. Subject to the terms of this Agreement,
any benefits distributable to the Participant under this Agreement that are not
paid at the time of the Participant's death shall be paid at the time and in the
form determined in accordance with the provisions of this Agreement, to the
beneficiary designated by the Participant in writing filed with the Company in
such form and at such time as the Company shall require. If a deceased
Participant fails to designate a beneficiary, or if the designated beneficiary
of the deceased Participant dies before the Participant or before complete
payment of the amounts distributable under this Agreement, the amounts to be
paid under this Agreement shall be paid to the legal representative or
representatives of the estate of the last to die of the Participant and the
beneficiary.
14. Administration. The authority to manage and control the operation
and administration of this Agreement shall be vested in the Chief Financial
Officer of the Company. Absent manifest error or bad faith, any interpretation
of the Agreement by the Chief Financial Officer of the Company and any decision
made by him with respect to the Agreement is final and binding.
15. Amendment. This Agreement may be amended by written Agreement of
the Participant and the Company, without the consent of any other person.
16. Limited Rights. Neither a Participant nor any other person shall,
by reason of this Agreement, acquire any right in or title to any assets, funds
or property of the Company whatsoever, including, without limitation, any
specific funds, assets, or other property which the Company, in its sole
discretion, may set aside in anticipation of a liability under this Agreement. A
Participant shall have only a contractual right to the Stock upon due exercise
of the Option, unsecured by any assets of the Company. This Agreement does not
constitute a contract of employment or give Participant the right to be retained
in the employ of the Company or any Related Company, nor any right or claim to
any benefit except as expressly provided in this Agreement. Except as otherwise
provided in the Plan, no Award under the Plan shall confer upon the holder
thereof any right as a stockholder of the Company prior to the date on which the
individual fulfills all conditions for receipt of such rights.
IN WITNESS WHEREOF, the Participant has executed this Agreement, and
the Company has caused these presents to be executed in its name and on its
behalf, all as of the Grant Date.
Participant
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Xxxxxx Interactive Inc.
By:
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Its: Chief Financial Officer
