Exhibit 4.6
LOCALEYES CORPORATION
1999 STOCK OPTION PLAN
1. Establishment, Purpose and Types of Awards
LocalEyes Corporation hereby establishes the LOCALEYES CORPORATION
1999 STOCK OPTION PLAN (the "Plan"). The purpose of the Plan is to promote the
long-term growth and profitability of LocalEyes Corporation (the "Corporation")
by (i) providing key people with incentives to improve stockholder value and to
contribute to the growth and financial success of the Corporation, and (ii)
enabling the Corporation to attract, retain and reward the best-available
persons for positions of substantial responsibility.
The Plan permits the granting of stock options (including incentive
stock options qualifying under Code section 422 and nonqualified stock options),
stock appreciation rights, restricted or unrestricted stock awards, phantom
stock, performance awards, or any combination of the foregoing.
2. Definitions
Under this Plan. except where the context otherwise indicates, the
following definitions apply:
(a) "Affiliate" shall mean any entity, whether now or hereafter
existing, which controls, is controlled by, or is under common control with, the
Corporation (including, but not limited to, joint ventures, limited liability
companies, and partnerships). For this purpose, "control" shall mean ownership
of 50% or more of the total combined voting power or value of all classes of
stock or interests of the entity.
(b) "Award" shall mean any stock option, stock appreciation right,
stock award, phantom stock award, or performance award.
(c) "Board" shall mean the Board of Directors of the Corporation.
(d) "Code" shall mean the Internal Revenue Code of 1986, as amended,
and any regulations promulgated thereunder.
(e) "Common Stock" shall mean shares of common stock of the
Corporation, par value of one-tenth of one cent ($0.001) per share.
(f) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
(g) "Fair Market Value" of a share of the Corporation's Common Stock
for any purpose on a particular date shall mean the last reported sale price per
share of Common Stock, regular way, on such date or, in case no such sale takes
place on such date, the average of the closing bid and asked prices, regular
way, in either case as reported in the principal consolidated transaction
reporting system with respect to securities listed or admitted to trading on a
national securities exchange or included for quotation on the Nasdaq National
Market. If, as the case may be, the relevant date is not a trading day, the
determination shall be made as of the next preceding trading day. As used
herein, the term "trading day" shall mean a day on which public trading of
securities occurs and is reported in the principal consolidated reporting system
referred to above. In the event that the Corporation's Common Stock is not
publicly traded, the Fair Market Value shall be the price per share determined
in good faith by the Board of Directors.
(h) "Grant Agreement" shall mean a written document memorializing the
terms and conditions of an Award granted pursuant to the Plan and shall
incorporate the terms of the Plan.
(i) "Parent" shall mean a corporation, whether now or hereafter
existing, within the meaning of the definition of `parent corporation" provided
in Code section 424(e), or any successor thereto.
(j) "Rule 16b-3" shall mean Rule 16b-3 as in effect under the Exchange
Act on the effective date of the Plan, or any successor provision prescribing
conditions necessary to exempt the issuance of securities under the Plan (and
further transactions in such securities) from Section 16(b) of the Exchange Act.
(k) "Subsidiary" and "subsidiaries" shall mean only a corporation or
corporations, whether now or hereafter existing, within the meaning of the
definition of "subsidiary corporation" provided in Section 424(f) of the Code,
or any successor thereto.
3. Administration
(a) Administration of the Plan. The Plan shall be administered by the
Board or by such committee or committees as may be appointed by the Board from
time to time (the Board, committee or committees hereinafter referred to as the
"Administrator").
(b) Powers of the Administrator. The Administrator shall have all the
powers vested in it by the terms of the Plan, such powers to include authority,
in its sole and absolute discretion, to grant Awards under the Plan, prescribe
Grant Agreements evidencing such Awards and establish programs for granting
Awards.
The Administrator shall have full power and authority to take all
other actions necessary to carry out the purpose and intent of the Plan,
including, but not limited to, the authority to:
(i) determine the eligible persons to whom, and the time or times at
which Awards shall be granted; (ii) determine the types of Awards to be granted;
(iii) determine the number of shares to be covered by or used for reference
purposes for each Award; (iv) impose such terms, limitations, restrictions and
conditions upon any such Award as the Administrator shall deem appropriate; (v)
modify, amend, extend or renew outstanding Awards, or accept the surrender of
outstanding Awards and substitute new Awards (provided however, that, except as
provided in the next sentence or in Section 7(d) of the Plan, any modification
that would materially adversely affect any outstanding Award shall not be made
without the consent of the holder); (vi) accelerate or otherwise change the time
in which an Award may be exercised or becomes payable and to waive or accelerate
the lapse, in whole or in part, of any restriction or condition with respect to
such Award, including, but not limited to, any restriction or condition with
respect to the vesting or exercisability of an Award following termination of
any grantee's employment; and (vii) establish objectives and conditions, if any,
for earning Awards and determining whether Awards will be paid after the end of
a performance period.
The Administrator shall have full power and authority, in its sole and
absolute discretion, to administer and interpret the Plan and to adopt and
interpret such rules, regulations, agreements, guidelines and instruments for
the administration of the Plan and for the conduct of its business as the
Administrator deems necessary or advisable.
(c) Non-Uniform Determinations. The Administrator's determinations
under the Plan (including without limitation, determinations of the persons to
receive Awards, the form, amount and timing of such Awards, the terms and
provisions of such Awards and the Grant Agreements evidencing such Awards) need
not be uniform and may be made by the Administrator selectively among persons
who receive, or are eligible to receive, Awards under the Plan, whether or not
such persons are similarly situated.
(d) Limited Liability. To the maximum extent permitted by law, no
member of the Administrator shall be liable for any action taken or decision
made in good faith relating to the Plan or any Award thereunder.
(e) Indemnification. To the maximum extent permitted by law and by the
Corporation's charter and by-laws, the members of the Administrator shall be
indemnified by the Corporation in respect of all their activities under the
Plan.
(f) Effect of Administrator `s Decision. All actions taken and
decisions and determinations made by the Administrator on all matters relating
to the Plan pursuant to the powers vested in it hereunder shall be in the
Administrator's sole and absolute discretion and shall be conclusive and binding
on all parties concerned, including the Corporation, its stockholders, any
participants in the Plan and any other employee of the Corporation, and their
respective successors in interest.
4. Shares Available for the Plan; Maximum Awards
Subject to adjustments as provided in Section 7(d) of the Plan,
the shares of Common Stock that may be issued with respect to Awards granted
under the Plan shall not exceed an aggregate of 11,000,000 shares of Common
Stock. The Corporation shall reserve such number of shares for Awards under the
Plan, subject to adjustments as provided in Section 7(d) of the Plan. If any
Award, or portion of an Award, under the Plan expires or terminates unexercised.
becomes unexercisable or is forfeited or otherwise terminated, surrendered or
canceled, or if any shares of Common Stock are surrendered to the Corporation in
connection with any Award (whether or not such surrendered shares were acquired
pursuant to any Award), the shares subject to such Award and the surrendered
shares shall thereafter be available for further Awards under the Plan;
provided, however, that any such shares that are surrendered to the Corporation
in connection with any Award or that are otherwise forfeited after issuance
shall not be available for purchase pursuant to incentive stock options intended
to qualify under Code section 422.
5. Participation
Participation in the Plan shall be open to all employees, officers,
directors and consultants of the Corporation, or of any Affiliate of the
Corporation, as may be selected by the Administrator from time to time.
6. Awards
The Administrator, in its sole discretion, establishes the terms of
all Awards granted under the Plan. Awards may be granted individually or in
tandem with other types of Awards. All Awards are subject to the terms and
conditions provided in the Grant Agreement.
(a) Stock Options. The Administrator may from time to time grant to
eligible participants Awards of incentive stock options as that term is defined
in Code section 422 or nonqualified stock options; provided, however, that
Awards of incentive stock options shall be limited to employees of the
Corporation or of any Parent or Subsidiary of the Corporation. Options intended
to qualify as incentive stock options under Code section 422 must have an
exercise price at least equal to Fair Market Value on the date of grant, but
nonqualified stock options may be granted with an exercise price less than Fair
Market Value. No stock option shall be an incentive stock option unless so
designated by the Administrator at the time of grant or in the Grant Agreement
evidencing such stock option.
(b) Stock Appreciation Rights. The Administrator may from time to time
grant to eligible participants Awards of Stock Appreciation Rights ("SAR"). An
SAR entitles the grantee to receive, subject to the provisions of the Plan and
the Grant Agreement, a payment having an aggregate value equal to the product of
(i) the excess of (A) the Fair Market Value on the exercise date of one share of
Common Stock over (B) the base price per share specified in the Grant Agreement,
times (ii) the number of shares specified by the SAR, or portion thereof, which
is exercised. Payment by the Corporation of the amount due upon any exercise of
an SAR may be made by the delivery of Common Stock or cash, or any combination
of Common Stock and cash, as determined in the sole discretion of the
Administrator. If upon settlement of the exercise of an SAR a grantee is to
receive a portion of such payment in shares of Common Stock, the number of
shares shall be determined by dividing such portion by the Fair Market Value of
a share of Common Stock on the exercise date. No fractional shares shall be used
for such payment and the Administrator shall determine whether cash shall .be
given in lieu of such fractional shares or whether such fractional shares shall
be eliminated.
(c) Stock Awards. The Administrator may from time to time grant
restricted or unrestricted stock Awards to eligible participants in such
amounts, on such terms and conditions, and for such consideration, including no
consideration or such minimum consideration as may be required by law, as it
shall determine. A stock Award may be paid in Common Stock, in cash, or in a
combination of Common Stock and cash, as determined in the sole discretion of
the Administrator.
(d) Phantom Stock The Administrator may from time to time grant Awards
to eligible participants denominated in stock-equivalent units ("phantom stock")
in such amounts and on such terms and conditions as it shall determine. Phantom
stock units granted to a participant shall be credited to a bookkeeping reserve
account solely for accounting purposes and shall not require a segregation of
any of the Corporation's assets. An Award of phantom stock may be settled in
Common Stock, in cash, or in a combination of Common Stock and cash, as
determined in the sole discretion of the Administrator. Except as otherwise
provided in the applicable Grant Agreement, the grantee shall not have the
rights of a stockholder with respect to any shares of Common Stock represented
by a phantom stock unit solely as a result of the grant of a phantom stock unit
to the grantee.
(e) Performance Awards. The Administrator may, in its discretion,
grant performance awards which become payable on account of attainment of one or
more performance goals established by the Administrator. Performance awards may
be paid by the delivery of Common Stock or cash, or any combination of Common
Stock and cash, as determined in the sole discretion of the Administrator.
Performance goals established by the Administrator may be based on the
Corporation's or an Affiliate's operating income or one or more other business
criteria selected by the Administrator that apply to an individual or group of
individuals, a business unit, or the Corporation or an Affiliate as a whole,
over such performance period as the Administrator may designate.
7. Miscellaneous
(a) Withholding of Taxes. Grantees and holders of Awards shall pay to
the Corporation, or make provision satisfactory to the Administrator for payment
of, any taxes required to be withheld in respect of Awards under the Plan no
later than the date of the event creating the tax liability. The Corporation
may, to the extent permitted by law, deduct any such tax obligations from any
payment of any kind otherwise due to the grantee or holder of an Award. In the
event that payment to the Corporation of such tax obligations is made in shares
of Common Stock, such shares shall be valued at Fair Market Value on the
applicable date for such purposes.
(b) Loans. The Corporation may make or guarantee loans to grantees to
assist grantees in exercising Awards and satisfying any withholding tax
obligations.
(c) Transferability. Except as otherwise determined by the
Administrator, and in any event in the case of an incentive stock option or a
stock appreciation right granted with respect to an incentive stock option, no
Award granted under the Plan shall be transferable by a grantee otherwise than
by will or the laws of descent and distribution. Unless otherwise determined by
the Administrator in accord with the provisions of the immediately preceding
sentence, an Award may be exercised during the lifetime of the grantee, only by
the grantee or, during the period the grantee is under a legal disability, by
the grantee's guardian or legal representative.
(d) Adjustments; Business Combinations. In the event of changes in the
Common Stock of the Corporation by reason of any stock dividend, split-up,
recapitalization, merger, consolidation, business combination or exchange of
shares and the like, the Administrator shall, in its discretion, make
appropriate adjustments to the maximum number and kind of shares reserved for
issuance or with respect to which Awards may be granted under the Plan as
provided in Section 4 of the Plan and to the number, kind and price of shares
covered by Awards granted, and shall, in its discretion and without the consent
of holders of Awards, make any other adjustments in Awards, including but not
limited to reducing the number of shares subject to Awards or providing or
mandating alternative settlement methods such as settlement of the Awards in
cash or in shares of Common Stock or other securities of the Corporation or of
any other entity, or in any other matters which relate to Awards as the
Administrator shall, in its sole discretion, determine to be necessary or
appropriate.
The Administrator is authorized to make, in its discretion and without
the consent of holders of Awards, adjustments in the terms and conditions of,
and the criteria included in, Awards in recognition of unusual or nonrecurring
events affecting the Corporation, or the financial statements of the Corporation
or any Subsidiary, or of changes in applicable laws, regulations, or accounting
principles, whenever the Administrator determines that such adjustments are
appropriate in order to prevent dilution or enlargement of the benefits or
potential benefits intended to be made available under the Plan.
(e) Termination, Amendment and Modification of the Plan. The Board may
terminate, amend or modify the Plan or any portion thereof at any time.
(f) Non-Guarantee of Employment or Service. Nothing in the Plan or in
any Grant Agreement thereunder shall confer any right on an individual to
continue in the service of the Corporation or shall interfere in any way with
the right of the Corporation to terminate such service at any time.
(g) No Trust or Fund Created. Neither the Plan nor any Award shall
create or be construed to create a trust or separate fund of any kind or a
fiduciary relationship between the Corporation and a grantee or any other
person. To the extent that any grantee or other person acquires a right to
receive payments from the Corporation pursuant to an Award, such right shall be
no greater than the right of any unsecured general creditor of the Corporation.
(h) Governing Law. The validity, construction and effect of the Plan,
of Grant Agreements entered into pursuant to the Plan, and of any rules,
regulations, determinations or decisions made by the Administrator relating to
the Plan or such Grant Agreements, and the rights of any and all persons having
or claiming to have any interest therein or thereunder, shall be determined
exclusively in accordance with applicable federal laws and the laws of the State
of Delaware, without regard to its conflict of laws principles.
(i) Effective Date; Termination Date. The Plan is effective as of the
date on which the Plan was adopted by the Board, subject to approval of the
stockholders within 12 months before or after such date. No Award shall be
granted under the Plan after the close of business on the day immediately
preceding the tenth anniversary of the effective date of the Plan. Subject to
other applicable provisions of the Plan, all Awards made under the Plan prior to
such termination of the Plan shall remain in effect until such Awards have been
satisfied or terminated in accordance with the Plan and the terms of such
Awards.
INCENTIVE STOCK OPTION GRANT AGREEMENT
UNDER THE
LOCALEYES CORPORATION 1999 STOCK OPTION PLAN
This Grant Agreement (the "Agreement") evidences the stock options
(each, an "Option" or collectively, the "Options") granted to
______________________ (the "Employee") by LocalEyes Corporation, a Delaware
corporation (the `Company"), effective as of _______________ (the "Grant
Date"), pursuant to the LocalEyes Corporation 1999 Stock Option Plan (the
"Plan") and conditioned upon the Employee's agreement to the terms described
below. All of the provisions of the Plan are expressly incorporated into
this Agreement.
1. Grant of Options. The Employee is granted ______________
Options under this Agreement. Each Option is an incentive stock option that
entitles the Employee to purchase from the Company, at a price of _____ per
share (the "Exercise Price"), one share of Common Stock of the Company. If
not sooner exercised or terminated, the Options expire at 5:00 p.m. Eastern
Time on the last business day coincident with or prior to the tenth
anniversary of the Grant Date (the "Expiration Date").
2. Terminologv. Unless stated otherwise in this Agreement, all
capitalized terms in this Agreement shall have the meanings ascribed to
them in the Plan. Except where the context otherwise requires, the term
"Company" shall include LocalEyes Corporation and its Affiliates.
3. Vesting.
(a) The shares of Common Stock underlying the Options are
referred to in this Agreement as "Option Shares."
(b) The Options vest in accordance with the attached
vesting schedule (the "Vesting Schedule") so long as the Employee is in the
continuous employ of, or in a service relationship with, the Company from
the Grant Day through the applicable date upon which vesting is scheduled to
occur unless otherwise specified herein. Subject to Section 3(c) below, no
vesting will accrue to any Options after the Employee ceases to be in either
an employment or other service relationship with the Company.
(c) Unless the Options have earlier terminated, the
vesting of the Options shall be accelerated so that the unvested portion of
the Option shall become 100% vested by the Employee upon the occurrence of a
Change in Control (other than a merger for the purposes of reincorporating
the Company in another state). For purposes of this Agreement, the term
"Change in Control" shall mean (i) the sale of all or substantially all of
the assets of the Company, (ii) the sale of more than 50% of the outstanding
voting capital stock of the Company in a non-public sale in one or a series
of related transactions, (iii) the dissolution or liquidation of the
Company, or (iv) any merger, share exchange, consolidation or other
reorganization or business combination of the Company if immediately after
such transaction either (A) persons who were directors of the Company
immediately prior to such transaction do not constitute at least a majority
of the directors of the surviving entity, or (B) persons who hold a majority
of the voting capital stock of the surviving entity are not persons who held
a majority of the voting capital stock of the Company immediately prior to
such transaction; provided, however, that the term "Change in Control" shall
not include any transaction pursuant to which shares of capital stock of the
Company are transferred or issued to any trust, charitable organization,
foundation, family partnership or other entity controlled directly or
indirectly by, or established for the benefit of their immediate family
members (including spouses, children, grandchildren, parents, and siblings,
in each case to include adoptive relations), or transferred to any such
immediate family members.
4. Exercise of Options.
(a) Right to Exercise. The Employee may exercise the
Options, to the extent vested, at any time on or before the Expiration
Date or the earlier termination of the Options, unless otherwise provided
in this Agreement. Section 5 below describes certain limitations on
exercise of the Options that apply in the event of the Employee's death,
disability, or termination of employment or other service relationship
with the Company. The Options may be exercised only in multiples of whole
shares and may not be exercised at any one time as to fewer than one
hundred shares (or such lesser number of shares as to which the Options
are then exercisable). No fractional shares will be issued under the
Options.
(b) Exercise Procedure. In order to exercise the
Options, the following items must be delivered to the Secretary of the
Company before the expiration or termination of the Options: (i) an
exercise notice, in such form as the Administrator may require from time
to time, specifying the number of Option Shares to be purchased, (ii)
full payment of the Exercise Price for such Option Shares or properly
executed, irrevocable instructions, in such form as the Administrator may
require from time to tame, to effectuate a broker-assisted cashless
exercise, each in accordance with Section 4(c) of this Agreement, and
(iii) an executed copy of any other agreements requested by the
Administrator pursuant to Section 4(d) of this Agreement. An exercise
will not be effective until all three of the foregoing items are received
by the Secretary of the Company.
(c) Method of Payment. Payment of the Exercise Price may
be made by any of the following methods, or a combination thereof, as
determined by the Administrator in its discretion at the rime of exercise:
(i) by delivery of cash, certified or cashier's
check, money order or other ash equivalent acceptable to the
Administrator in its discretion;
(ii) by tender (via actual delivery or
attestation) to the Company of other shares of Common Stock of the
Company which have a Fair Market Value on the date of tender equal
to the Exercise Price, provided that such shares have been owned
by the Employee for a period of at least six months free of any
substantial risk of forfeiture or were purchased on the open
market without assistance, direct or indirect, from the Company;
(iii) by withholding of Option Shares otherwise
issuable pursuant to the exercise which have a Fair Market Value on
the date of exercise equal to the Exercise Price;
(iv) by a broker-assisted cashless exercise in
accordance with Regulation T of the Board of Governors of the
Federal Reserve System through a brokerage firm approved by the
Administrator; or
(v) by any other method approved by the
Administrator.
(d) Agreement by Employee to Execute Other Agreements.
The Employee agrees to execute, as a condition precedent to the exercise of
the Options, a Stock Restriction Agreement in such form as the
Administrator may from time to time request; provided, however, that
execution of the Stock Restriction Agreement will not be required upon any
exercise of the Options that occurs after the closing of the first public
offering of capital stock of the Company that is effected pursuant to a
registration statement filed with, and declared effective by, the
Securities and Exchange Commission under the Securities Act of 1933 or, if
later, the expiration of any market stand-off agreement that applies to
other shareholders of the Company respecting such public offering of
capital stock. The Employee acknowledges and agrees that the Stock
Restriction Agreement may include such provisions as the Administrator in
its sole discretion may determine are desirable including, without
limitation, restrictions on transfer, rights of first refusal of the
Company. Company repurchase rights that may be exercised at any time and
for any reason, including repurchases under specified circumstances that
will result in the Employee not realizing any gain from the purchasing of
the shares, deferred payment for the purchase of shares from the Employee,
rights to require sale of the shares in the event of a change in control of
the Company and limitations on sales immediately following an initial
public offering. Copies of the Stock Restriction Agreement are available
for inspection at any time prior to exercise of the Options upon written
request. Except as provided above, exercise of the Options and issuance of
the underlying Option Shares will be conditioned upon the Employee's (i)
receipt of the Stock Restriction Agreement (ii) acknowledgment that the
Employee has read and understands the terms and provisions of the Stock
Restriction Agreement and enters into such agreement voluntarily with an
intent to be bound by its provisions, and (iii) delivery of executed copies
of the Stock Restriction Agreement to the Administrator.
(e) Issuance of Shares upon Exercise. Upon exercise of
the Options in accordance with the terms of this Agreement, the Company
will issue to the Employee, the brokerage firm specified in the Employee's
delivery instructions pursuant to a broker-assisted cashless exercise, or
such other person exercising the Options, as the case may be, the number of
shares of Common Stock so paid for, in the form of fully paid and
nonassessable stock. The Company will deliver stock certificates for the
Option Shares as soon as practicable after exercise, which certificates
will, unless such Option Shares are registered or an exemption from
registration is available under applicable federal and state law, bear a
legend restricting transfer ability of such shares and referencing any
applicable Stock Restriction Agreement.
5. Termination of Employment or Service.
(a) Exercise Period Following Cessation of Employment or
Other Service Relationship. In General. If the Employee ceases to be
employed by, or in a service relationship with, the Company for any reason
other than death, total and permanent disability (as defined in Section
5(b) below), or discharge for Misconduct (as defined in Section 5(d)
below), (i) the unvested Options, after giving effect to the provisions of
Section 3 of this Agreement, terminate immediately upon such cessation, and
(ii) the vested Options shall remain exercisable during the 30-day period
following such cessation, but in no event after the Expiration Date. Unless
sooner terminated, the vested Options terminate upon the expiration of such
30-day period.
(b) Disability of Employee. Notwithstanding the
provisions of Section 5(a) above, if the Employee ceases to be employed by,
or in a service relationship with, the Company as a result of the
Employee's total and permanent disability, (i) the unvested Options, after
giving effect to the provisions of Section 3 of this Agreement, shall
terminate immediately upon such cessation, and (ii) the vested Options
shall remain exercisable during the 30-day period following such cessation,
but in no event after the Expiration Date. Unless sooner terminated, the
vested Options terminate upon the expiration of such 30-day period. For
purposes of this Agreement, "total and permanent disability" shall mean the
inability to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment which can be expected
to result in death or which has Lasted or can be expected to last for a
continuous period of not less than twelve months. The Administrator may
require such proof of total and permanent disability as the Administrator
in its sole discretion deems appropriate and the Administrator's good faith
determination as to whether the Employee is totally and permanently
disabled shall be final and binding on all parties concerned.
(c) Death of Employee. If the Employee dies prior to the
expiration or other termination of the Options, (i) the unvested Options,
after giving effect to the provisions of Section 3 of this Agreement,
shall terminate immediately upon the Employee's death, and (ii) the vested
Options shall remain exercisable during the one (1) year period following
the Employee's death, but in no event after the Expiration Date. by the
Employee's executor, personal representative, or the person(s) to whom the
Options are transferred by will or the laws of descent and distribution.
Unless sooner terminated, the vested Options terminate upon the expiration
of such one (1) year period.
(d) Misconduct. Notwithstanding anything to the contrary
in this Agreement. the Options terminate in their entirety, regardless of
whether the Options are vested, immediately upon the Employee's discharge
of employment or other service relationship for Misconduct or upon the
Employee's commission of Misconduct during any period following the
cessation of employment or other service relationship during which the
Options otherwise would be exercisable. For purposes of this Agreement,
"Misconduct" means (i) the Employee's conviction of, or plea of nolo
contendere to a felony or crime involving moral turpitude; (ii) fraud on
or misappropriation of any funds or property of the Company; (iii) the
Employee's personal dishonesty, incompetence, willful misconduct, willful
violation of any law, rule or regulation (other than minor traffic
violations or similar offenses) or breach of fiduciary duty which involves
personal profit; (iv) willful misconduct in connection with the Employee's
duties or willful failure to perform his responsibilities in the best
interests of the Company; (v) chronic use of alcohol, drugs or other
similar substances affecting the Employee's work performance; or (vi)
breach by the Employee of any provision of any employment, non-disclosure,
non-competition, non-solicitation or other similar agreement executed by
the Employee for the benefit of the Company including without limitation
this Agreement, al] as determined by the Administrator, which
determination shall be conclusive and binding for all purposes hereunder.
(e) Change in Status. If the Employee's relationship
with the Company ceases to be a "common law employee" relationship but the
Employee continues to provide bona fide services to the Company following
such cessation in a different capacity, including without limitation as a
director, consultant or independent contractor, then a termination of
employment or other service relationship shall not be deemed to have
occurred for purposes of this Section 5 upon such change in relationship.
Notwithstanding the foregoing, the Options shall not be treated as
incentive stock options within the meaning of Code section 422 with
respect to any exercise that occurs more than 90 days after such cessation
of the common law employee relationship (except as otherwise permitted
under Code section 421 or 422).
6. Lock-Up Agreement. The Employee agrees that following the
effective date of a registration statement of the Company filed under the
Securities Act of 1933, the Employee, for the duration specified by and to
the extent requested by the Company and an underwriter of Common Stock or
other securities of the Company, will not directly or indirectly sell,
offer to sell, contract to sell (including without limitation, any short
sale), grant any option to purchase, or otherwise transfer or dispose of
any Option Shares held by the Employee at any time during such period
except Option Shares included in such registration; provided however, that
(a) such agreement shall be applicable only to the first such registration
statement of the Company which covers Common Stock (or other securities)
to be sold on its behalf to the public in an underwritten offering, and
(b) all officers and directors of the Company enter into similar
agreements.
7. Nontransferability of Options. These Options are
nontransferable otherwise than by will or the laws of descent and
distribution and during the lifetime of the Employee, the Options may be
exercised only by the Employee or, during the period the Employee is under
a legal disability, by the Employee's guardian or legal representative.
Except as provided above, the Options may not be assigned, transferred,
pledged, hypothecated or disposed of in any way (whether by operation of
law or otherwise) and shall not be subject to execution. attachment or
similar process.
8. Drag-Along Rights. If at any time any stockholder of the
Company, or group of stockholders, owning a majority or more of the voting
capital stock of the Company (hereinafter, the "Transferring
Stockholders") proposes to enter into any transaction involving (a) a sale
of more than 50% of the outstanding voting capital stock of the Company in
a non-public sale or (b) any merger, share exchange, consolidation or
other reorganization or business combination of the Company immediately
after which a majority of the directors of the surviving entity is not
comprised of persons who were directors of the Company immediately prior
to such transaction or after which persons who hold a majority of the
voting capital stock of the surviving entity are not persons who held a
majority of the voting capital stock of the Company immediately prior to
such transaction. the Company may require the Employee to participate in
such transaction by giving the Employee written notice thereof at least
ten days in advance of the date of the transaction or the date that tender
is required, as the case may be (hereinafter referred to as the
"Drag-Along Date"). Notwithstanding anything herein to the contrary and
without the Employees consent, if such notice is provided to the Employee,
then the outstanding Options, or a portion thereof, as determined by the
Company in its sole discretion and specified in the written notice of the
transaction, shall terminate effective as of the Drag-Along Date and shall
be of no further force or effect thereafter, provided that in
consideration therefor the Employee receives from the Company, the
acquirer or the Company's successor, an aggregate amount equal to the
product of (a) the number of vested Options that terminate, multiplied by
(b) the difference between (i) the Exercise Price per share of the Options
and (ii) the price the Transferring Stockholders receive per share of
Common Stock pursuant to the terms of the transaction, adjusted as
determined by the Administrator to reflect the fact that the Exercise
Price with respect to the Options has not, in fact, been paid. The payment
of such amount to the Employee shall be made either upon the same terms
and conditions as those applicable to the Transferring Stockholders with
respect to their Common Stock pursuant to the terms of the transaction or
via delivery of immediately available funds within thirty days following
the transaction, as determined in the sole discretion of the payor.
9. Qualified Nature of the Options. The Options are intended to
qualify as incentive stock options within the meaning of Code section 422
("Incentive Stock Options"), to the fullest extent permitted by Code
section 422, and this Agreement shall be so construed. Pursuant to Code
section 422(d) the aggregate fair market value (determined as of the Grant
Date) of shares of Common Stock with respect to which all Incentive Stock
Options first become exercisable by the Employee in any calendar year
under the Plan or any other plan of the Company (and its parent and
subsidiary corporations, within the meaning of Code section 424(e) and
(f), as may exist from time to time) may not exceed $100,000 or such other
amount as may be permitted from time to time under Code section 422. To
the extent that such aggregate fair market value exceeds $100,000 or other
applicable amount in any calendar year, such stock options will be treated
as nonstatutory stock options with respect to the amount of aggregate fair
market value thereof that exceeds the Code section 422(d) limit. For this
purpose. The Incentive Stock Options will be taken into account in the
order in which they were granted. In such case, the Company may designate
the shares of Common Stock that are to be treated as stock acquired
pursuant to the exercise of Incentive Stock Options and the shares of
Common Stock that are to be treated as stock acquired pursuant to
nonstatutory stock options by issuing separate certificates for such
shares and identifying the certificates as such in the stock transfer
records of the Company.
Notwithstanding anything herein to the contrary, if the Employee
owns, directly or indirectly through attribution, stock possessing more
than 10% of the total combined voting power of all classes of stock of the
Company or of any of its subsidiaries (within the meaning of Code section
424(0) on the Grant Date, then the Exercise Price is the greater of (a)
the Exercise Price stated in Section 1 or (b) 110% of the Fair Market
Value of the Common Stock on the Grant Date, and the Expiration Date is
the last business day coincident with or prior to the fifth anniversary of
the Grant Date.
Code section 422 provides additional limitations respecting the
treatment of these Options as Incentive Stock Options.
10. Notice of Disqualifying Disposition. If the Employee makes a
disposition (as that term is defined in Code section 424(c)) of any Option
Shares acquired pursuant to these Options within two years of the Grant
Date or within one year after the Option Shares are transferred to the
Employee, the Employee agrees to notify the Administrator of such
disposition in writing within 30 days of the disposition.
11. Withholding of Taxes. At the time the Options are exercised,
in whole or in part, or at any time thereafter as requested by the
Company, the Employee hereby authorizes withholding from payroll or any
other payment of any kind due the Employee and otherwise agrees to make
adequate provision for foreign, federal, state and local taxes required by
law to be withheld, if any, which arise in connection with the Options
(including upon a disqualifying disposition within the meaning of Code
section 421(b)). The Company may require the Employee to make a cash
payment to cover any withholding tax obligation as a condition of exercise
of the Options or issuance of share certificates representing Option
Shares.
The Administrator may, in its sole discretion, permit the
Employee to satisfy, in whole or in part, any withholding tax obligation
which may arise in connection with the Options either by electing to have
the Company withhold from the shares to be issued upon exercise that
number of shares, or by electing to deliver to the Company already-owned
shares, in either case having a Fair Market Value equal to the amount
necessary to satisfy the statutory minimum withholding amount due.
12. Adjustments and Business Combinations.
(a) Adjustments for Events Affecting Common Stock. Upon a
stock dividend of, or stock split or reverse stock split affecting, the
Common Stock of the Company, the number of shares covered by and the
exercise price and other terms of the Options shall, without further
action of the Board, be adjusted to reflect such event unless the Board
determines, at the time it approves such stock dividend, stock split or
reverse stock split, that no such adjustment shall be made. The
Administrator may make adjustments, in its discretion, to address the
treatment of fractional shares and fractional cents that arise with
respect to the Options as a result of the stock dividend, stock split or
reverse stock split. In the event of any other changes affecting the
Company, the capitalization of the Company or the Common Stock of the
Company by reason of any spin-off, split-up, dividend, recapitalization,
merger, consolidation, business combination or exchange of shares and the
like, the Administrator, in its discretion and without the consent of the
Employee, shall make any other adjustments in the Options, including but
not limited to reducing the number of shares subject to the Options or
providing or mandating alternative settlement methods such as settlement
of the Options in cash or in shares of Common Stock or other securities of
the Company or of any other entity, or in any other matters which relate
to the Options as the Administrator shall, in its sole discretion,
determine to be necessary or appropriate.
(b) PooIing of Interests Transaction. Notwithstanding
anything in the Plan or this Agreement to the contrary and without the
consent of the Employee, the Administrator, in its sole discretion, may
make any modifications to the Options, including but not limited to
cancellation, forfeiture, surrender or other termination of the Options in
whole or in part regardless of the vested status of the Options, in order
to facilitate any business combination that is authorized by the Board to
comply with requirements for treatment as a pooling of interests
transaction for accounting purposes under generally accepted accounting
principles.
(c) Adjustments for Unusual Events. The Administrator is
authorized to make, in its discretion and without the consent of the
Employee, adjustments in the terms and conditions of. and the criteria
included in, the Options in recognition of unusual or nonrecurring events
affecting the Company, or the financial statements of the Company or any
Affiliate, or of changes in applicable laws, regulations, or accounting
principles, whenever the Administrator determines that such adjustments
are appropriate in order to prevent dilution or enlargement of the
benefits or potential benefits intended to be made available under the
Options or the Plan.
(d) Binding Nature of Adjustments. Adjustments under this
Section 12 wil] be made by the Administrator, whose determination as to
what adjustments, if any. will be made and the extent thereof will be
final, binding and conclusive. No fractional shares will be issued
pursuant to the Options on account of any such adjustments. The terms and
conditions of this Agreement shall apply with equal force to any
additional and/or substitute securities received by the Employee pursuant
to this Section 12 in exchange for, or by virtue of the Employee's
ownership of, the Options or the Option Shares, except as otherwise
determined by the Administrator.
13. Confidential Information. In consideration of the Options
granted to the Employee pursuant to this Agreement, the Employee agrees
and covenants that, except as specifically authorized by the Company, the
Employee will keep confidential any trade secrets or confidential or
proprietary information of the Company which are now or which hereafter
may become known to the Employee as a result of the Employee's employment
by or other service relationship with the Company, and shall not at any
time, directly or indirectly, disclose any such information to any person,
firm, Company or other entity, or use the same in any way other than in
connection with the business of the Company, at all times during and after
the Employee's employment or other service relationship. The provisions of
this Section 13 shall not narrow or otherwise limit the obligations and
responsibilities of the Employee set forth in any agreement of similar
import entered into between the Employee and the Company.
14. Non-Guarantee of Employment or Service Relationship. Nothing
in the Plan or this Agreement shall alter the at-will or other employment
status or other service relationship of the Employee, nor be construed as
a contract of employment or service relationship between the Company and
the Employee, or as a contractual right of Employee to continue in the
employ of, or in a service relationship with, the Company for any period
of time, or as a limitation of the right of the Company to discharge the
Employee at any time with or without cause or notice.
15. No Rights as a Stockholder. The Employee shall not have any
of the rights of a stockholder with respect to the Option Shares until
such shares have been issued to him or her upon the due exercise of the
Options. No adjustment shall be made for dividends or distributions or
other rights for which the record date is prior to the date such shares
are issued.
16. The Company's Rights. The existence of the Options shall not
affect in any way the right or power of the Company or its stockholders to
make or authorize any or all adjustments, recapitalizations,
reorganizations or other changes in the Company's capital structure or its
business, or any merger or consolidation of the Company, or any issue of
bonds, debentures, preferred or other stocks with preference ahead of or
convertible into, or otherwise affecting the Common Stock or the rights
thereof, or the dissolution or liquidation of the Company, or any sale or
transfer of all or any part of the Company's assets or business, or any
other corporate act or proceeding, whether of a similar character or
otherwise.
17. Employee. Whenever the word "Employee" is used in any
provision of this Agreement under circumstances where the provision should
logically be construed, as determined by the Administrator, to apply to
the estate, personal representative, or beneficiary to whom the Options
may be transferred by will or by the laws of descent and distribution, the
word "Employee" shall be deemed to include such person.
18. Notices. All notices and other communications made or given
pursuant to this Agreement shall be in writing and shall be sufficiently
made or given if hand delivered or mailed by certified mail, addressed to
the Employee at the address contained in the records of the Company, or
addressed to the Administrator, care of the Company for the attention of
its Corporate Secretary at its principal office or, if the receiving party
consents in advance, transmitted and received via telecopy or via such
other electronic transmission mechanism as may be available to the
parties.
19. Entire Agreement. This Agreement contains the entire
agreement between the parties with respect to the Options granted
hereunder. Any oral or written agreements, representations, warranties,
written inducements, or other communications made prior to the execution
of this Agreement with respect to the Options granted hereunder shall be
void and ineffective for all purposes.
20. Amendment. This Agreement may be amended from time to time by
the Administrator in its discretion; provided, however, that this
Agreement may not be modified in a manner that would have a materially
adverse effect on the Options or Option Shares as determined in the
discretion of the Administrator, except as provided in the Plan or in a
written document signed by each of the parties hereto.
21. Conformity with Plan. This Agreement is intended to conform
in all respects with, and is subject to all applicable provisions of, the
Plan. Inconsistencies between this Agreement and the Plan shall be resolved
in accordance with the terms of the Plan. in the event of any ambiguity in
this Agreement or any matters as to which this Agreement is silent, the
Plan shall govern. A copy of the Plan is provided to you with this
Agreement.
22. Governing Law. The validity, construction and effect of this
Agreement, and of any determinations or decisions made by the Administrator
relating to this Agreement, and the rights of any and all persons having or
claiming to have any interest under this Agreement, shall be determined
exclusively in accordance with the laws of the State of Delaware. without
regard to its conflict of laws principles.
23. Headings. The headings in this Agreement are for reference
purposes only and shall not affect the meaning or interpretation of this
Agreement.
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed by its duly authorized officer as of the date first written
above.
LOCALEYES CORPORATION
By:
Name:
Title:
The undersigned hereby acknowledges that he/she has carefully read this
Agreement and the Plan and agrees to be bound by all of the provisions set
forth in such documents.
EMPLOYEE
By:
Name:
Enclosure: LocalEyes Corporation 1999 Stock Incentive Plan
VESTING SCHEDULE FOR INCENTIVE STOCK OPTION GRANT
VESTING DATE* AGGREGATE PERCENTAGE OF TOTAL OPTIONS VESTED
AS OF VESTING DATE
* The extent to which the Options are vested as of a particular vesting
date specified above, determined based on the total number of Option
Shares underlying the Options as specified in Section 1 of the
Agreement, is rounded down to the nearest whole share. However,
vesting is rounded up to the nearest whole share with respect to the
last vesting date reflected on this Vesting Schedule.
EXERCISE FORM
Administrator of the LocalEyes Corporation 1999 Stock Option Plan
c/o Office of the Corporate Secretary
LocalEyes Corporation
Gentlemen:
I hereby exercise the Option granted to me on
_____________________ by LocalEyes Corporation (the "Company"), subject to all
the terms and provisions thereof and of the LocalEyes Corporation 1999 Stock
Option Plan (the "Plan"), and notify you of my desire to purchase
_______________ shares of Common Stock of the Company at a price of
$_____________ per share pursuant to the exercise of said Option. This will
confirm my understanding with respect to the shares to be issued to me by reason
of this exercise of the Option (the shares to be issued pursuant hereto shall be
collectively referred to hereinafter as the "Shares") as follows:
(a) I am acquiring the Shares for my own account for
investment with no present intention of dividing my interest with others or
of reselling or otherwise disposing of any of the Shares.
(b) The Shares are being issued without registration
under the Securities Act of 1933, as amended (the "Act"), in reliance upon
one or more exemptions contained in the Act, and such reliance is based in
part on the above representation.
(c) The certificates for the Shares to be issued to me
will bear a legend substantially as follows:
"The securities represented by this stock
certificate have not been registered under the Securities Act of
1933 (the "Act") or applicable state securities laws (the "State
Acts"), and shall not be sold, pledged, hypothecated, donated, or
otherwise transferred (whether or not for consideration) by the
holder except upon the issuance to the Company of a favorable
opinion of its counsel and/or submission to the Company of such
other evidence as may be satisfactory to counsel for the Company,
to the effect that any such transfer shall not be in violation of
the Act and the State Acts.
The shares of stock represented by this
certificate are subject to forfeiture, restrictions on transfer, an
option to purchase and a market stand-off agreement set forth in a
certain Stock Restriction Agreement between the Company and the
registered owner of this certificate (or his predecessor in
interest), and no transfer of such shares may be made without
compliance with that Agreement. A copy of that Agreement is
available for inspection by any shareholder of the Company at the
office of the Company upon appropriate request and without charge."
Appropriate stop transfer instructions will be issued by the issuer to its
transfer agent.
(d) Since the Shares have not been registered under the
Act, they must be held indefinitely until an exemption from the
registration requirements of the Act is available or they are subsequently
registered, in which event the representation in Paragraph (a) hereof
shall terminate. As a condition to any transfer of the shares, I
understand that the issuer will require an opinion of counsel satisfactory
to the issuer to the effect that such transfer does not require
registration under the Act or any state securities law.
(e) The issuer is not obligated to comply with the
registration requirements of the Act or with the requirements for an
exemption under Regulation A under the Act for my benefit.
(f) I am a party to a Stock Restriction Agreement with
the issuer, pursuant to which I have agreed to certain restrictions on thc
transferability of the Shares and other matters relating thereto.
Total Amount Enclosed: $__________________
Date: _____________________ ____________________________________
(Employee)
Received by LocalEyes Corporation on
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By:
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