EXHIBIT 99.3
INFOSPACE, INC.
NONQUALIFIED STOCK OPTION AGREEMENT
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This Agreement is made as of__________ (the "GRANT DATE"), between InfoSpace,
Inc., a Delaware corporation (the "COMPANY"), and _____________ ("OPTIONEE").
WHEREAS, pursuant to that certain Agreement and Plan of Merger dated as of May
12, 1998, between InfoSpace, Inc., Outpost Network, Inc., certain stockholders
of Outpost, and Outpost Acquisition, Inc. (the "Merger Plan Agreement"), the
Company agreed to grant nonqualified stock options ("NSOs") to purchase a total
of 298,000 shares of the Company's common stock at an exercise price of $.01 per
share to certain former OutPost employees, such as Optionee, to be retained by
the Company;
WHEREAS, the grant of the option described in this Agreement is made pursuant
to the Merger Plan Agreement, the terms and conditions of this Agreement and,
with the exception of option price terms, upon the other terms and conditions of
the Restated 1996 Flexible Stock Incentive Plan (the "Plan"), a copy of which is
incorporated into this Agreement by reference.
NOW, THEREFORE, in consideration of the mutual covenants hereinafter set
forth, the parties to this Agreement hereby agree as follows:
1. OPTION GRANT. The Company hereby grants to Optionee the right and option
to purchase from the Company on the terms and conditions hereinafter set forth,
all or any part of an aggregate of ________ shares of the Company's Common Stock
(the "STOCK"). This option is not intended to qualify as an incentive stock
option under Section 422 of the Internal Revenue Code of 1986, as amended (the
"CODE").
2. OPTION PRICE. The purchase price of the Stock subject to this option
shall be $0.01 per share. The term "OPTION PRICE" as used in this Agreement
refers to the per share purchase price of the Stock subject to this option.
3. OPTION PERIOD. This option shall be exercisable only during the option
period (the "OPTION PERIOD"), and during such Option Period, the exercisability
of the option shall be subject to the limitations of paragraph 4 and the vesting
provisions of paragraph 5. The Option Period shall commence on the Grant Date
and except as provided in paragraph 4, shall terminate ten years from the Grant
Date (the "TERMINATION DATE").
4. LIMITS ON OPTION PERIOD. The Option Period may end before the Termination
Date, as follows:
(a) If Optionee ceases to be a bona fide employee of or service
provider to the Company or an Affiliate (as defined in the Plan) for any reason
other than disability or death during the Option Period, unless otherwise
determined by the Plan Administrator, (i) the Option Period shall terminate
three months after the date of such cessation of employment or service or on the
Termination Date, whichever shall first occur, and (ii) the option shall be
exercisable only to the extent provided under paragraph 5 on the date of
Optionee's cessation of employment or service and thereafter shall cease to be
exercisable. In the case of termination of Optionee's employment or services for
cause, the option shall automatically terminate upon first notification to
Optionee of such termination, unless the Plan Administrator determines
otherwise. All of
Optionee's rights under this option shall be suspended during any investigation
of whether Optionee should be terminated for cause.
The term "CAUSE" as used in this Agreement means dishonesty, fraud,
misconduct, unauthorized use or disclosure of confidential information or trade
secrets, or conviction or confession of a crime punishable by law (except minor
violations), in each case as determined by the Plan Administrator, and its
determination shall be conclusive and binding.
The term "DISABILITY" as used in this Agreement means a mental or physical
impairment of Optionee that is expected to result in death or that has lasted or
is expected to last for a continuous period of 12 months or more and that causes
Optionee to be unable, in the opinion of the Company and two independent
physicians, to perform duties for the Company and to be engaged in any
substantial gainful activity. Disability shall be deemed to have occurred on
the first day after the Company and the two independent physicians have
furnished their opinion of disability to the Plan Administrator.
(b) If Optionee dies while in the employ of or service to the
Company or any of its Affiliates, unless otherwise determined by the Plan
Administrator, (i) the Option Period shall end one year after the date of death
or on the Termination Date, whichever shall first occur, and (ii) Optionee's
executor or administrator or the person or persons to whom Optionee's rights
under this option shall pass by will or by the applicable laws of descent and
distribution may exercise this option only to the extent exercisable under
paragraph 5 on the date of Optionee's death.
(c) If Optionee's employment or service is terminated by reason of
disability, unless otherwise determined by the Plan Administrator, (i) the
Option Period shall end one year after the date of Optionee's cessation of
employment or service or on the Termination Date, whichever shall first occur,
and (ii) the option shall be exercisable only to the extent exercisable under
paragraph 5 on the date of Optionee's cessation of employment or service.
(d) If Optionee is on a leave of absence from the Company or an
Affiliate because of Optionee's disability, or for the purpose of serving the
government of the country in which the principal place of employment of Optionee
is located, either in a military or civilian capacity, or for such other purpose
or reason as the Plan Administrator may approve, Optionee shall not be deemed
during the period of such absence, by virtue of such absence alone, to have
terminated employment or service with the Company or an Affiliate except as the
Plan Administrator may otherwise expressly provide.
5. VESTING OF RIGHT TO EXERCISE OPTIONS. Subject to other limitations
contained in this Agreement, the Optionee shall have the right to exercise this
option in accordance with the following schedule:
(a) As to 25% of the total number of shares of Stock covered by the
option, at any time after one year from the vesting commencement date, which is
___________ (the "Vesting Commencement Date");
(b) As to an additional 2.08333% of the total number of shares of
Stock covered by the option, at any time after the end of each one-month period
thereafter, such that the option shall be fully exercisable four years after the
Vesting Commencement Date.
(c) Any portion of the option that is not exercised shall
accumulate and may be exercised at any time during the Option Period prior to
the Termination Date. No partial exercise of this option may be for less than 5%
of the total number of shares of Stock then available under this option. In no
event shall the Company be required to issue fractional shares.
6. METHOD OF EXERCISE. Optionee may exercise the option with respect to all
or any part of the shares of Stock then subject to such exercise as follows:
(a) By giving the Company written notice of such exercise,
specifying the number of such shares of Stock as to which this option is
exercised. Such notice shall be accompanied by an amount equal to the Option
Price of such shares, in the form of any one or combination of the following:
(i) cash; (ii) a certified check, bank draft, postal or express money order
payable to the order of the Company in lawful money of the United States; (iii)
shares of Stock valued at fair market value; or (iv) if authorized for Optionee
by the Plan Administrator, notes. The shares of Stock shall be valued in
accordance with procedures established by the Plan Administrator. Any note used
to exercise this option shall be a full recourse, interest-bearing obligation
containing such terms as the Plan Administrator shall determine. If a note is
used, the Optionee agrees to execute such further documents as the Plan
Administrator may deem necessary or appropriate in connection with issuing the
note, perfecting a security interest in the Stock purchased with the note, and
any related terms or conditions that the Plan Administrator may propose. Such
further documents may include, not by way of limitation, a security agreement,
an escrow agreement, a voting trust agreement and an assignment separate from
certificate. In the event that the exercise price is satisfied by the Plan
Administrator retaining from the shares of Stock otherwise to be issued to
Optionee shares of Stock having a value equal to the exercise price, the Plan
Administrator may issue Optionee an additional option, with terms identical to
this Agreement, entitling Optionee to purchase additional Stock in an amount
equal to the number of shares of Stock so retained.
(b) At the Plan Administrator's discretion, Optionee (and
Optionee's spouse, if any) shall be required, as a condition precedent to
acquiring Stock through exercise of the option, to execute one or more
agreements relating to obligations in connection with ownership of the Stock or
restrictions on transfer of the Stock no less restrictive than the obligations
and restrictions to which the other stockholders of the Company are subject at
the time of such exercise, including repurchase and first refusal rights by the
Company.
(c) If required by the Plan Administrator, Optionee shall give the
Company satisfactory assurance in writing, signed by Optionee or Optionee's
legal representative, as the case may be, that such shares are being purchased
for investment and not with a view to the distribution thereof; provided,
however, that such assurance shall be deemed inapplicable to (i) any sale of
such shares by such Optionee made in accordance with the terms of a registration
statement covering such sale, which may hereafter be filed and become effective
under the Securities Act of 1933, as amended (the "SECURITIES ACT"), and with
respect to which no stop order suspending the effectiveness thereof has been
issued, and (ii) any other sale of such shares with respect to which, in the
opinion of counsel for the Company, such assurance is not required to be given
in order to comply with the provisions of the Securities Act.
(d) As soon as practicable after receipt of the notice required in
paragraph 6(a) and satisfaction of the conditions set forth in paragraphs 6(b)
and 6(c), the Company shall, without transfer or issue tax and without other
incidental expense to Optionee, deliver to Optionee at the principal offices of
the Company, at 8424 154th Avenue NE, Redmond, Washington 98052, attention of
the Secretary, or such other place as may be mutually acceptable to the Company
and Optionee, a certificate or certificates of such shares of Stock; provided,
however, that the time of such delivery may be postponed by the Company for such
period as may be required for it with reasonable diligence to comply with
applicable registration requirements under the Securities Act, the Securities
Exchange Act of 1934, as amended, any applicable listing requirements of any
national securities exchange or the Nasdaq National Market, and requirements
under any other law or regulation applicable to the issuance or transfer of such
shares.
7. CORPORATE TRANSACTIONS.
(a) If there should be any change in a class of Stock subject to
this option, through merger, consolidation, reorganization, recapitalization,
reincorporation, stock split, stock dividend or other change in the corporate
structure of the Company, the Company shall make appropriate adjustments in
order to preserve, but not to increase, the benefits to Optionee, including
adjustments in the number of shares of such Stock subject to this option and in
the per share purchase price thereof. Any adjustment made pursuant to this
paragraph 7 as a consequence of a change in the corporate structure of the
Company shall not entitle Optionee to acquire a number of shares of such Stock
of the Company or shares of stock of any successor company greater than the
number of shares Optionee would receive if, prior to such change, Optionee had
actually held a number of shares of such Stock equal to the number of shares
subject to this option.
(b) For purposes of this paragraph 7, a "CORPORATE TRANSACTION"
shall include any of the following stockholder-approved transactions to which
the Company is a party:
(i) a merger or consolidation in which the Company is not the
surviving entity, except for (1) a transaction the principal purpose of
which is to change the state of the Company's incorporation, or (2) a
transaction in which the Company's stockholders immediately prior to such
merger or consolidation hold (by virtue of securities received in exchange
for their shares in the Company) securities of the surviving entity
representing more than 50% of the total voting power of such entity
immediately after such transaction;
(ii) the sale, transfer or other disposition of all or
substantially all of the assets of the Company unless the Company's
stockholders immediately prior to such sale, transfer or other disposition
hold (by virtue of securities received in exchange for their shares in the
Company) securities of the purchaser or other transferee representing more
than 50% of the total voting power of such entity immediately after such
transaction; or
(iii) any reverse merger in which the Company is the surviving
entity but in which the Company's stockholders immediately prior to such
merger do not hold (by virtue of their shares in the Company held
immediately prior to such transaction) securities of the Company
representing more than 50% of the total voting power of the Company
immediately after such transaction.
(c) In the event of any Corporate Transaction, this option shall
terminate immediately prior to the specified effective date of the Corporate
Transaction unless assumed by the successor corporation or its parent company,
pursuant to options providing substantially equal value and having substantially
equivalent provisions as the options granted pursuant to this Agreement.
8. LIMITATIONS ON TRANSFER. This option shall, during Optionee's lifetime,
be exercisable only by Optionee, and this option shall not be transferable by
Optionee by operation of law or otherwise other than by will or the laws of
descent and distribution. In the event of any attempt by Optionee to alienate,
assign, pledge, hypothecate, or otherwise dispose of this option, except as
provided for in this Agreement, or in the event of the levy of any attachment,
execution, or similar process upon the option, the Company at its election may
terminate this option by notice to Optionee and this option shall thereupon
become null and void.
9. NO STOCKHOLDER RIGHTS. Neither Optionee nor any person entitled to
exercise Optionee's rights in the event of his death shall have any of the
rights of a stockholder with respect to the shares of Stock subject to this
option except to the extent the certificates for such shares shall have been
issued upon the exercise of this option.
10. NO EFFECT ON TERMS OF EMPLOYMENT. SUBJECT TO THE TERMS OF ANY WRITTEN
EMPLOYMENT CONTRACT TO THE CONTRARY, THE COMPANY (OR ITS AFFILIATE WHICH EMPLOYS
OPTIONEE) SHALL HAVE THE RIGHT TO TERMINATE OR CHANGE THE TERMS OF EMPLOYMENT OF
OPTIONEE AT ANY TIME AND FOR ANY REASON WHATSOEVER, WITH OR WITHOUT CAUSE.
11. NOTICE. Any notice required to be given under the terms of this
Agreement shall be addressed to the Company in care of its Secretary at the
Office of the Company set forth in paragraph 6 hereof, and any notice to be
given to Optionee shall be addressed to Optionee at the address given beneath
Optionee's signature to this Agreement, or such other address as either party to
this Agreement may hereafter designate in writing to the other. Any such notice
shall be deemed to have been duly given when enclosed in a properly sealed
envelope or wrapper addressed as aforesaid, registered or certified and
deposited (postage or registration or certification fee prepaid) in a post
office or branch post office regularly maintained by the United States.
12. LOCK-UP AGREEMENT.
(a) Optionee, if requested by the Company and the lead underwriter
of any public offering of the Common Stock or other securities of the Company
(the "LEAD UNDERWRITER"), hereby irrevocably agrees not to sell, contract to
sell, grant any option to purchase, transfer the economic risk of ownership in,
make any short sale of, pledge or otherwise transfer or dispose of any interest
in any Common Stock or any securities convertible into or exchangeable or
exercisable for or any other rights to purchase or acquire Common Stock (except
Common Stock included in such public offering or acquired on the public market
after such offering) during the 180-day period following the effective date of a
registration statement of the Company filed under the Securities Act, or such
shorter period of time as the Lead Underwriter shall specify. Optionee further
agrees to sign such documents as may be requested by the Lead Underwriter to
effect the foregoing and agrees that the Company may impose stop-transfer
instructions with respect to such Common Stock subject until the end of such
period. The Company and Optionee acknowledge that each Lead Underwriter of a
public offering of the Company's stock, during the period of such offering and
for the 180-day period thereafter, is an intended beneficiary of this Section
12.
(b) Notwithstanding the foregoing, Section 12(a) shall not prohibit
Optionee from transferring any shares of Common Stock or securities convertible
into or exchangeable or exercisable for the Company's Common Stock either during
Optionee's lifetime or on death by will or intestacy to Optionee's immediate
family or to a trust the beneficiaries of which are exclusively Optionee and/or
a member or members of Optionee's immediate family; provided, however, that
prior to any such transfer, each transferee shall execute an agreement pursuant
to which each transferee shall agree to receive and hold such securities subject
to the provisions of Section 12 hereof. For the purposes of this paragraph, the
term "IMMEDIATE FAMILY" shall mean spouse, lineal descendant, father, mother,
brother or sister of the transferor.
(c) During the period from identification as a Lead Underwriter in
connection with any public offering of the Company's Common Stock until the
earlier of (i) the expiration of the lock-up period specified in Section 12(a)
in connection with such offering or (ii) the abandonment of such offering by the
Company and the Lead Underwriter, the provisions of the Section 12 may not be
amended or waived except with the consent of the Lead Underwriter.
13. PLAN ADMINISTRATOR DECISIONS CONCLUSIVE. All decisions of the Plan
Administrator upon any question arising under the Plan or under this Agreement
shall be conclusive.
14. SUCCESSORS. This Agreement shall be binding upon and inure to the
benefit of any successor or successors of the Company. Where the context
permits, "OPTIONEE" as used in this Agreement
shall include Optionee's spouse, executor, administrator or other legal
representative or the person or persons to whom Optionee's rights pass by will
or the applicable laws of descent and distribution.
15. WITHHOLDING. Optionee agrees to withholding of shares from exercise for
satisfaction of any applicable federal, state or local income tax or employment
tax withholding requirements. The Plan Administrator may issue Optionee an
additional option, with terms identical to this option agreement, entitling
Optionee to purchase additional Stock in an amount equal to the number of shares
so retained.
16. WASHINGTON LAW. The interpretation, performance and enforcement of this
Agreement shall be governed by the laws of the State of Washington.
IN WITNESS WHEREOF, the Company and Optionee have executed this Agreement as
of the day and year first above written. Optionee hereby accepts the
nonqualified stock option described above and acknowledges receipt of a copy of
this Agreement and the Plan.
INFOSPACE, INC., a Delaware corporation
By: ___________________________________
Name: _________________________________
Title: ________________________________
OPTIONEE
Dated: _________________ Name: ________________________________
Address: _____________________________
_______________________________________
ATTACHMENT A
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CONSENT OF SPOUSE
I, ____________________________________________, spouse of
___________________, have read and understood the foregoing Agreement and Plan.
In consideration of granting my spouse the right to purchase shares of
InfoSpace, Inc., as set forth in the Agreement, I hereby appoint my spouse as my
attorney-in-fact with respect to the exercise of any rights of the Agreement
insofar as I may have any rights under such community property laws of the State
of Washington or similar laws relating to marital property in effect in the
state of our residence as of the date of the signing of the foregoing Agreement.
Dated: __________________ By: _____________________________
By his or her signature below, the Optionee represents that he or she is
not legally married as of the date of execution of this Agreement.
Dated: _________________
__________________________________
Optionee's Signature