McAfee, Inc. 1997 Stock Incentive Plan, as amended Stock Option Agreement
Exhibit 10.2
McAfee, Inc.
1997 Stock Incentive Plan, as amended
1997 Stock Incentive Plan, as amended
1. Grant of Option. The Company hereby grants Optionee an Option to purchase the number of
shares of the Company’s common stock (“Shares”) under the McAfee, Inc. 1997 Stock Incentive Plan,
as amended (the “Plan”), as set forth in the Notice of Grant (the “Notice”). The terms of this
Option are set forth in the Plan, the Notice and this Stock Option Agreement including the Appendix
(the “Agreement”). In the event of a conflict between the terms and conditions of the Plan and the
terms and conditions of this Agreement or the Notice, the terms and conditions of the Plan shall
prevail. Capitalized terms used in this Agreement without definition shall have the meanings
ascribed to such terms in the Plan or the Notice as applicable.
2. Exercise of Option.
(a) Right to Exercise. This Option is exercisable during its term in accordance with
the vesting schedule and restrictions on exercisability set forth in the Notice and the applicable
provisions of the Plan and this Agreement.
(b) Method of Exercise.
(i) This Option may be exercised through the Company’s designated broker. The Optionee shall
specify the number of Shares being purchased, and the exercise shall be effective when the online
exercise is complete or hard copy exercise notice is provided to the Company (if permitted) and the
aggregate Exercise Price for the number of Shares being purchased, and any Tax-Related Items (as
defined in Section 11 below), is received by the Company.
(ii) No Shares will be issued pursuant to the exercise of an Option (and no exercise will be
permitted) unless such issuance and such exercise complies with all relevant applicable provisions
of law, whether foreign or domestic, and the requirements of any stock exchange or interdealer
quotation system upon which the Shares may then be listed or traded.
(iii) If this Option is being exercised by the representative of the Optionee, the
representative must prove the Company’s satisfaction that he or she is entitled to do so.
3. Method of Payment.
(a) Unless provided otherwise in the Appendix, payment of the Exercise Price shall be by any
of the following, or a combination thereof, at the election of Optionee: (i) cash in U.S. dollars,
(ii) check payable in U.S. dollars, (iii) irrevocable directions to a designated broker appointed
by the Company to sell all or a portion of the Shares subject to the exercised Option, and to
deliver to the Company from the sale proceeds an amount sufficient to pay the Exercise Price and
any Tax-Related Items (as defined in Section 11 below). The balance of the sale proceeds, if any,
will be delivered to Optionee in cash if all Shares were directed to be sold, or in Shares if only
a portion of the Shares were directed to be sold to cover the Exercise Price and Tax-Related Items
(as defined in Section 11 below). Regardless of the method of payment of the Exercise Price, the
exercise instructions must be received in a form approved by the Company and Optionee must provide
any other documentation required by the Company at the time of exercise.
(b) Neither the Optionee nor the Optionee’s representative shall have any rights as a
shareholder with respect to any Shares subject to this Option until the Optionee or the Optionee’s
representative becomes entitled to receive such Shares by completing an exercise as described in
Section 2 above and paying the aggregate Exercise Price pursuant to Section 2 and Section 3(a).
4. Termination of Relationship for Any Reason except Death or Disability. In the event an
Optionee’s active service as an Employee or Consultant terminates for any reason except Disability
(as defined below) or death, Optionee may, to the extent this Option was vested at the Termination
Date (as defined below), exercise this
Option at any time during the 90-day period immediately following the Termination Date. To the
extent that Optionee was
not vested in this Option at the Termination Date, or if Optionee does not
exercise this Option within the time specified herein, this Option shall terminate.
Notwithstanding the foregoing, in no event shall any Option be exercisable later than the
Expiration Date as provided in the Notice. “Termination Date” shall be defined as the date an
Optionee’s active service as an Employee or Consultant terminates, as determined by the Company in
its sole discretion. For the purposes of this Agreement, the Termination Date will not be extended
to include any notice period mandated under local law.
5. Termination of Relationship in Event of Death or Disability of Optionee. In the event
an Optionee’s active service as an Employee or Consultant terminates as a result of his or her
death or Disability, Optionee (or his or her estate or legal representative in the event of death)
may, to the extent this Option was vested at the Termination Date, exercise this Option at any time
during the 12-month period immediately following the Termination Date. To the extent that Optionee
was not vested in this Option at the Termination Date, or if Optionee (or his or her estate or
legal representative in the event of death) does not exercise this Option within the time specified
herein, this Option shall terminate. Notwithstanding the foregoing, in no event shall any Option
be exercisable later than the Expiration Date as provided in the Notice. For the purposes of
receiving treatment under this Section 5, “Disability” shall be defined as an inability to engage
in any substantial gainful activity by reason of any medically determinable physical or mental
impairment that can be expected to result in death or can be expected to last for a continuous
period of not less than 12 months. For the purposes of administering the Plan, the Company shall
determine in its sole discretion whether Optionee’s active service terminated due to death or
Disability.
6. Non-Transferability of Option. Unless otherwise provided in the Plan, this Option may
not be transferred in any manner otherwise than by will or by the laws of descent and distribution
and may be exercised during the lifetime of Optionee only by the Optionee. The terms of the
Notice, the Plan and this Agreement shall be binding upon the executors, administrators, heirs,
successors and assigns of the Optionee.
7. Term of Option. This Option may be exercised only within the term set out in the Notice
and this Agreement, and may be exercised during such term only in accordance with the terms of the
Notice, the Plan and this Agreement.
8. Adjustment. The number of Shares subject to the Option shall be subject to adjustment
as provided in Article 10 of the Plan.
9. Data Privacy. Optionee hereby explicitly and unambiguously consents to the collection,
use and transfer, in electronic or other form, of his or her personal data as described in this
Agreement by and among, as applicable, the employer (“the Employer”), the Company and any
Subsidiary or Affiliate for the exclusive purpose of implementing, administering and managing his
or her participation in the Plan.
Optionee understands that the Company and his or her Employer may hold certain personal information
about Optionee, including, but not limited to, his or her name, home address and telephone number,
date of birth, social insurance number or other identification number, salary, nationality, job
title, any Shares or directorships held in the Company or any Subsidiary or Affiliate, details of
all Options or any other entitlement to Shares awarded, canceled, exercised, vested, unvested or
outstanding in Optionee’s favor, for the exclusive purpose of implementing, administering and
managing the Plan (“Data”).
Optionee understands that Data will be transferred to E*Trade Financial Services, Inc. or to any
other third party assisting in the implementation, administration and management of the Plan.
Optionee understands that the recipients of the Data may be located in Optionee’s country or
elsewhere, and that the recipient’s country may have different data privacy laws and protections
than Optionee’s country. Optionee understands that he or she may request a list with the names and
addresses of any potential recipients of the Data by contacting his or her local human resources
representative. Optionee authorizes the Company, E*Trade Financial Services, Inc. and any other
recipients of Data which may assist the Company (presently or in the future) with implementing,
administering and managing the Plan to receive, possess, use, retain and transfer the Data, in
electronic or
other form, for the purposes of implementing, administering and managing Optionee’s participation
in the Plan, including any requisite transfer of such Data as may be required to a broker or other
third party with whom Optionee may elect to deposit any Shares purchased upon exercise of the
Option. Optionee understands that
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Data will be held only as long as is necessary to implement,
administer and manage his or her participation in the Plan. Optionee understands that he or she
may, at any time, view Data, request additional information about the storage and processing of
Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any
case without cost, by contacting in writing Optionee’s local human resources representative.
Optionee understands that refusal or withdrawal of consent may affect Optionee’s ability to
participate in the Plan. For more information on the consequences of his or her refusal to consent
or withdrawal of consent, Optionee understands that he or she may contact his or her local human
resources representative.
10. Nature of Grant. In accepting the grant, Optionee acknowledges that:
(a) the Plan is established voluntarily by the Company, is discretionary in nature,
and may be modified, amended, suspended or terminated by the Company at any time;
(b) the grant of the Option is voluntary and occasional and does not create any contractual or
other right to receive future grants of options, or benefits in lieu of options, even if options
have been granted repeatedly in the past;
(c) all decisions with respect to future option grants, if any, will be at the sole discretion
of the Company;
(d) Optionee’s participation in the Plan is voluntary;
(e) Optionee’s participation in the Plan shall not create a right to further employment with
the Employer and shall not interfere with the ability of the Employer to terminate Optionee’s
employment or service relationship (if any) at any time;
(f) Optionee is voluntarily participating in the Plan;
(g) the Option and any Shares purchased under the Plan are extraordinary items that do not
constitute compensation of any kind for services of any kind rendered to the Employer, the Company
or any Subsidiary or Affiliate, and that are outside the scope of Optionee’s employment or service
contract, if any;
(h) the Option and any Shares purchased under the Plan are not intended to replace any pension
rights or compensation;
(i) the Option and any Shares purchased under the Plan are not part of normal or expected
compensation or salary for any purposes, including, but not limited to, calculating any severance,
resignation, termination, redundancy, end-of-service payments, bonuses, long-service awards,
pension or retirement or welfare benefits or similar payments and in no event should be considered
as compensation for, or relating in any way to, past services for the Employer, the Company or any
Subsidiary or Affiliate;
(j) in the event that Optionee is not a direct employee of Company, the Option grant will not
be interpreted to form an employment contract or relationship with Company and furthermore, the
Option grant will not be interpreted to form an employment contract with Optionee’s Employer or any
Subsidiary or Affiliate;
(k) the future value of the Shares underlying the Option is unknown and cannot be predicted
with certainty;
(l) if the underlying Shares do not increase in value, the Option will have no value;
(m) if Optionee exercises the Option and purchases Shares, the value of such Shares may
increase or decrease in value, even below the Exercise Price;
(n) in consideration of the grant of the Option, no claim or entitlement to compensation or
damages shall arise from termination of the vesting of the Option or cancellation of the Option
following termination of Optionee’s active service as an Employee or Consultant (for any reason
whatsoever and whether or not in breach of
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local labor laws) and Optionee irrevocably releases the
Employer, the Company and any Subsidiary or Affiliate from any such claim that may arise; if,
notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have
arisen, then, by signing the Notice, Optionee shall be deemed irrevocably to have waived his or her
entitlement to pursue such claim;
(o) notwithstanding any terms or conditions of the Plan to the contrary, in the event of
voluntary or involuntary termination of Optionee’s active service as an Employee or Consultant,(i)
Optionee’s right to receive Options and vest in Options under the Plan, if any, will terminate
effective as of the Termination Date, and (ii) Optionee’s right to exercise the Options after
termination of active service as an Employee or Consultant, if any, will be measured by the
Termination Date;
(p) the Company is not providing any tax, legal or financial advice, nor is the Company making
any recommendations regarding Optionee’s participation in the Plan or Optionee’s purchase or sale
of Shares; and
(q) Optionee is xxxxxx advised to consult with his or her own personal tax, legal and
financial advisors regarding participation in the Plan before taking any action related to the
Plan; and the Option and the benefits under the Plan, if any, will not automatically transfer to
another company in the case of a merger, take-over or transfer of liability.
11. Responsibility for Taxes.
(a) Regardless of any action the Company and/or the Employer takes with respect to any or all
income tax, social insurance, payroll tax, payment on account or other tax-related items arising
out of Optionee’s participation in the Plan and legally applicable to Optionee (“Tax-Related
Items”), Optionee acknowledges that the ultimate liability for all Tax-Related Items is and remains
Optionee’s responsibility and may exceed the amount actually withheld by the Company and/or the
Employer. Optionee further acknowledges that the Company and/or the Employer (a) make no
representations or undertakings regarding the treatment of any Tax-Related Items in connection with
any aspect of the Option grant, including, but not limited to, the grant, vesting or exercise of
the Option, the subsequent sale of Shares purchased pursuant to such exercise and the receipt of
any dividends; and (b) do not commit and are under no obligation to structure the terms of the
grant or any aspect of the Option to reduce or eliminate Optionee’s liability for Tax-Related Items
or achieve any particular tax result. Further, if Optionee has become subject to tax in more than
one jurisdiction between the grant date and the date of any relevant taxable event, Optionee
acknowledges that the Company and/or the Employer (or former employer, as applicable) may be
required to withhold or account for Tax-Related Items in more than one jurisdiction.
(b) Prior to the relevant taxable or tax withholding event, as applicable, Optionee shall pay
or make arrangements satisfactory to the Company and/or the Employer to satisfy all Tax-Related
Items. In this regard, Optionee authorizes the Company and/or the Employer, or their respective
agents, at their discretion, to satisfy the Tax-Related Items by one or a combination of the
following: (i) withholding from Optionee’s wages or other cash compensation paid to Optionee by the
Company, the Employer and any Subsidiary or Affiliate; or (ii) withholding from proceeds of the
sale of Shares acquired at exercise of the Option either through a voluntary sale or through a
mandatory sale arranged by the Company (on Optionee’s behalf pursuant to this authorization); or
(iii) withholding in Shares to be issued at exercise of the Option.
(c) To avoid any negative accounting treatment, the Company may withhold or account for
Tax-Related Items by considering applicable minimum statutory withholding amounts or other
applicable withholding rates. If the obligation for Tax-Related Items is satisfied by withholding
in Shares, for tax purposes, Optionee is deemed to have been issued the full number of Shares
subject to the exercised Options, notwithstanding that a number of the Shares are held back solely
for the purpose of paying the Tax-Related Items due as a result of any aspect of Optionee’s
participation in the Plan.
(d) Optionee shall pay to the Company or the Employer any amount of Tax-Related Items that the
Company or the Employer may be required to withhold or account for as a result of Optionee’s
participation in the Plan that cannot be satisfied by the means previously described in this
section. The Company may refuse to issue or deliver the Shares or the proceeds from the sale of
Shares, if Optionee fails to comply with his or her obligations in connection with the Tax-Related
Items as described in this section.
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12. Entire Agreement; Governing Law. The Plan is incorporated herein by reference. The
Plan, the Notice, and this Agreement ,including the Appendix, constitute the entire agreement of
the parties with respect to the subject matter hereof and supersede in their entirety all prior
undertakings and agreements and all contemporaneous oral undertakings and agreements of the Company
and Optionee with respect to the subject matter hereof, and may not be modified to materially and
adversely affect the Optionee’s interest except by means of a writing signed by the Company and
Optionee. This Agreement shall be governed by the laws of the State of Delaware without giving
effect to the conflict of law principles thereof. For purposes of litigating any dispute that
arises directly or indirectly from the relationship of the parties evidenced by this grant or this
Agreement, the parties hereby submit to and consent to the exclusive jurisdiction of the State of
California, and agree that such litigation shall be conducted only in the courts of Santa Xxxxx
County, California, or the federal courts for the United States for the Northern District of
California, and no other courts, where this grant is made and/or to be performed.
13. Language. If Optionee has received this Agreement, or any other document related to
the Option and/or the Plan translated into a language other than English and if the translated
version is different than the English version, the English version will control.
14. Severability. The provisions of this Agreement are severable and if any one or more
provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the
remaining provisions shall nevertheless be binding and enforceable.
15. No Advice Regarding Award. The Company is not providing any tax, legal or financial
advice, nor is the Company making any recommendation regarding the Optionee’s participation in the
Plan, or the acquisition or sale of underlying Shares. The Optionee is advised to consult with his
or her personal tax, legal, and financial advisors regarding the decision to participate in the
Plan and before taking any action related to the Plan.
16. Electronic Delivery and Participation. The Company may, in its sole discretion, decide
to deliver any documents related to the Option or future options that may be granted under the Plan
by electronic means or request Optionee’s consent to participate in the Plan by electronic means.
Optionee hereby consents to receive such documents by electronic delivery and, if requested, to
agree to participate in the Plan through an on-line or electronic system established and maintained
by the Company or a third party designated by the Company.
17. Severability. The provisions of this Agreement are severable and if any one or more
provisions are determined to be illegal or otherwise unenforceable, in whole or in part, the
remaining provisions shall nevertheless be binding and enforceable.
18. Appendix. The Option shall be subject to any special provisions set forth in the
country-specific Appendix for Optionee’s country of residence, as applicable (the “Appendix”). If
Optionee relocates to one of the countries included in the Appendix during the life of the Option,
the special provisions for such country shall apply to Optionee, to the extent the Company
determines that the application of such provisions is necessary or advisable in order to comply
with local law or facilitate the administration of the Plan. The Appendix constitutes part of this
Agreement.
19. Tax Consequences.
Non-U.S. taxpayers: Optionee should consult a tax adviser to determine the tax consequences
applicable to their particular situation before exercising this Option or disposing of the Shares.
The following provisions of this Section 19 apply only to U.S. taxpayers.
U.S. taxpayers: Optionee acknowledges that he or she has read the description of tax U.S.
consequences set forth below and has consulted his or her personal tax advisor regarding the same
to the extent he or she has determined advisable. Optionee is not relying on the Company, or any
of its officers, directors, employees or advisors, for any tax advice or planning information
whatsoever. Set forth below is a brief summary as of the date of this Option of some of the U.S.
federal tax consequences of exercise of this Option and disposition of the Shares. THIS SUMMARY IS
NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT
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TO CHANGE. OPTIONEE SHOULD
CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.
(a) Exercise of Nonstatutory Stock Option. There may be a regular federal income tax
liability upon the exercise of a nonstatutory stock option. Optionee will be treated as having
received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of
the Fair Market Value of the Shares on the date of exercise over the Exercise Price. If Optionee
is an Employee or a former Employee, the Company will be required to withhold for U.S. federal
taxes and FICA from Optionee’s compensation or proceeds from exercise or otherwise collect these
amounts from Optionee.
(b) Disposition of Shares. In the case of a nonstatutory stock option, if Shares are
held for at least one year, any gain realized on disposition of the Shares (i.e., the sales price
of the Shares less the Fair Market Value of the Shares at exercise) will be treated as long-term
capital gain for federal tax purposes.
20. Imposition of Other Requirements. The Company reserves the right to impose other
requirements on the Option and the Shares purchased upon exercise of the Option, to the extent the
Company determines it is necessary or advisable in order to comply with local laws or facilitate
the administration of the Plan, and to require Optionee to sign any additional agreements or
undertakings that may be necessary to accomplish the foregoing.
Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations
of the Administrator upon any questions relating to the Notice, the Plan and this Agreement.
* * * * *
By Optionee’s electronic acceptance and/or signature on the Notice, the Optionee agrees that this
Option is granted under and governed by the terms and conditions of the Notice, the Plan and this
Agreement.
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