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Exhibit 10.23
THE LEARNING COMPANY, INC.
1996 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
STOCK OPTION AGREEMENT
The Learning Company, Inc. (the "Company") has granted to you an
option (the "Option") to purchase the number of shares (the "Shares") of common
stock, par value $.01 per share, of the Company ("Common Stock") listed on
Exhibit A hereto at the exercise price set forth on Exhibit A. The Option is
granted subject in all respects to the terms of the Company's 1996 Non-Employee
Director Stock Option Plan (the "Plan"). The Option does not constitute an
"incentive stock option" within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended. Capitalized terms used and not defined in this
Agreement shall have the meanings assigned to such terms in the Plan.
The terms of the Option are as follows:
1. TERM. The term of the Option commences on the Grant Date
set forth in Exhibit A and, except as provided in Section 4 hereof, ends on the
Expiration Date set forth on Exhibit A.
2. EXERCISABILITY. The Option shall be exercisable at the
times, and with respect to the number of Shares, set forth on Exhibit A.
Exercisability of the Option may also be accelerated or adjusted as
provided in the Plan.
3. EXERCISE AND PAYMENT.
(a) EXERCISE. You, or the person or persons having the
right to exercise the Option upon Disability, may exercise the Option to
purchase all or any part of the Shares for which it is then exercisable by
delivering in person or by mail to the Secretary of the Company a completed
Notice of Exercise Form attached hereto as Exhibit B (the "Exercise Form"),
together with payment of the exercise price. The date the Company receives full
payment of the exercise price and any required documents from you will be
considered the date that the Option was exercised. You shall not have privileges
as a stockholder until the date of issuance of a stock certificate representing
Shares.
(b) PAYMENT OF EXERCISE PRICE. Payment of the exercise
price must be made in full at the time of exercise in cash, by certified or
cashier's check or, in the sole discretion of the Committee, pursuant to such
other methods as may be permitted under the Plan. In lieu of full payment of the
exercise price in cash, upon request, the Committee may, in its sole discretion,
allow you (or the person or persons having the right to exercise the Option upon
your death or Disability), to exercise the Option or a portion thereof by
tendering shares of Common Stock (including Shares received upon exercise of the
Option), valued at Fair Market Value on the date
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immediately preceding the day of exercise, equal to the exercise price for the
Shares being acquired, as permitted by the Plan.
(c) WITHHOLDING TAX. You may be subject to withholding
taxes which, in the Company's judgment, result from the purchase of shares upon
exercise of the Option. At the time of any exercise of the Option (or at any
such later time as such obligation arises or as the amount of such obligation
becomes determinable), you shall pay to the Company in cash all applicable
federal, state, local and foreign withholding and employment taxes required to
be withheld resulting from exercise of the Option, from the lapse of any
restriction imposed on the Shares, from a transfer or other disposition of the
Shares, or otherwise related to the Shares. The Company may withhold from your
wages, or require you to pay to the Company, such amount. The Committee may in
its discretion permit you to pay some or all of such amount as provided in
Section 15 of the Plan, with all decisions of the Committee to be made at any
time at or prior to each exercise of the Option.
4. TERMINATION OF EMPLOYMENT.
(a) GENERAL. In the event of your Termination for any
reason other than death or Disability before exercise in full of your Option,
you may (only to the extent then exercisable on the date of such Termination)
exercise your Option in whole or in part any time within 90 days after the date
of Termination (unless otherwise indicated on Exhibit A hereto).
(b) DEATH OR DISABILITY. In the event of your Termination
by reason of death or Disability prior to the exercise in full of your option,
you, your personal representative or the person to whom the Option is
transferred by will or the laws of descent and distribution may (only to the
extent exercisable on the date of such Termination) exercise the Option in whole
or in part at any time within one year after the date of death or Disability, as
the case may be.
(c) CAUSE. In the event of your Termination by reason of
Cause (as defined in the Plan), you may have a period of time to be determined
by the Committee not to exceed ten days from the date of cessation of service
(but in no event after the expiration date of the Option) to exercise the Option
(to the extent exercisable at the time of the optionee's cessation of service),
and the Option shall thereafter terminate.
(d) FINAL CUT-OFF. In no event may this Option be exercised
by anyone after the Expiration Date.
5. TAX CONSEQUENCES. The tax consequences associated with this
Option are complex and can depend upon your particular circumstances. The
Company is not making any warranties or representations to you with respect to
the income tax consequences of the transactions contemplated by the option
agreement, and you should consult a tax advisor before exercising this Option.
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6. THE PLAN.
(a) PLAN PROVISIONS APPLICABLE. The Option is subject to
all provisions of the Plan, a copy of which is being delivered to you with this
Agreement. The Plan is described in the Prospectus which is also being delivered
to you with this Agreement.
(b) OPTION AND PLAN PROVISIONS CONTROL. THE OPTIONS
DESCRIBED IN THE PROSPECTUS MAY VARY SUBSTANTIALLY FROM THIS OPTION. YOUR RIGHTS
ARE AS SET FORTH IN THIS AGREEMENT AND THE PLAN, WHICH CONTROL IN THE EVENT OF
ANY INCONSISTENCY WITH THE DESCRIPTION IN THE PROSPECTUS.
7. TRANSFER OF OPTIONS.
(a) The Option represented by this Agreement may be
received by the Optionee in exchange for an option granted under the Company's
1996 Stock Option Plan. In the event of any conflict between the terms of this
Option and the option granted under the 1996 Stock Option Plan, the terms of the
Plan and this Agreement shall govern.
(b) This Option may be transferred to your spouse, child or
grandchild or trust or limited partnership for your or their benefit.
8. ADJUSTMENTS. The Company may adjust the number and kind of
stock issuable upon exercise of the Option and the exercise price thereof in
certain circumstances in accordance with the provisions of Section 8 and Section
9 of the Plan.
9. LEGALITY OF ISSUANCE. The Company shall not be obligated to
sell or issue any Shares pursuant to this Agreement if such sale or issuance, in
the opinion of the Company or the Company's counsel, might constitute a
violation by the Company of any provision of law, including without limitation
the provisions of the Securities Act of 1933, as amended.
10. INVESTMENT REPRESENTATIONS. The Company may, as a
condition of issuance Shares, require you to make such investment
representations as the Company and the Company's counsel deem necessary or
desirable in order to assure compliance with applicable federal or state
securities law.
11. LEGENDS. The Company may impose restrictions upon the
sale, pledge or other transfer of Shares acquired upon exercise of this option
(including the placement of appropriate legends on stock certificates) if, in
the judgment of the Company or the Company's counsel, such restrictions are
necessary or desirable in order to achieve compliance with any federal or state
securities or other laws.
12. MISCELLANEOUS.
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12.1 ASSIGNMENT; BINDING EFFECT; NO TRANSFER. Subject to the
limitations set forth in this Agreement, this Agreement shall be binding upon
and insure to the benefit of the executors, administrators, heirs, legal
representatives, successors and assigns of the parties hereto; PROVIDED,
HOWEVER, that you may not assign any of your rights under this Agreement. The
Option is not transferable except at death by will or the laws of descent and
distribution, and is exercisable during your lifetime only by you.
12.2 DAMAGES. You shall be liable to the Company for all costs
and damages, including incidental and consequential damages and attorneys' fees
and expenses, resulting from a disposition of shares which is not in conformity
with the provisions of this Agreement.
12.3 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of Delaware.
12.4 NOTICES. All notices and other communications under this
agreement shall be in writing. Unless you are notified in writing to the
contrary, all notices, communications and documents directed to the Company and
related to the Agreement, if not delivered by hand, shall be mailed, addressed
as follows:
The Learning Company, Inc.
One Athenaeum Street
Cambridge, MA 02142
Attention: Secretary
Unless and until the Company is notified in writing to the contrary, all
notices, communications and documents intended for you and related to this
Agreement, if not delivered by hand, shall be mailed to your last known address
as shown on the Company's books. Notices and communications shall be mailed by
first class mail, postage prepaid; documents shall be mailed by U.S. registered
mail, return receipt requested, postage prepaid. All mailing and deliveries
related to the Agreement shall be deemed delivered, if mailed, on the second day
after they are deposited in the U.S. mail.
12.5 EXHIBITS. The exhibits attached to, or delivered to you
with, this Agreement (including without limitation the Plan) are incorporated
herein and form a part of this Agreement.
12.6 ENTIRE AGREEMENT. This Agreement, including the Plan,
contains all of the terms and conditions agreed upon by the parties relating to
its subject matter and supersedes any and all prior and contemporaneous
agreements, negotiations, correspondence, understandings and communications of
the parties whether oral or written, respecting that subject matter.
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12.7 ATTORNEYS' FEES. If any party to this Agreement seeks to
enforce this Agreement by legal proceedings or otherwise, the nonprevailing
party shall pay the prevailing party's costs and expenses, including, without
limitation reasonable attorneys' fees.
12.8 VALIDITY OF PROVISIONS; SEVERABILITY. If any provision of
this Agreement is held invalid, illegal or unenforceable, the provision shall be
adjusted if possible rather than voided to carryout its intent to the maximum
extent possible and in all events the remainder of this Agreement will remain in
full force and effect.
12.9 COUNTERPARTS. This Agreement may be signed in
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same agreement.
THE LEARNING COMPANY, INC.
By:
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R. Scott Murray
Chief Financial Officer
OPTIONEE
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CONSENT OF SPOUSE
If the Optionee resides in California, or another community property
jurisdiction, I, as the Optionee's spouse, also accept and agree to be bound by
the terms and conditions of this option and the Plan.
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Optionee's Spouse
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